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Chow Tai Fook, Chow Sang Sang Respond to Price Fixing Charges

Jul 19, 2013 10:06 AM   By Jeff Miller
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RAPAPORT... Chow Tai Fook Jewellery Group and Chow Sang Sang International face an investigation for price fixing gold products, along with a number of other jewelry firms in China, according to the  People’s Daily newspaper. A similar corruption investigation  is underway in China for companies that make infant formula  and pharmaceuticals. Early today, China’s National Development and Reform Commission named a number of jewelers it alleged had been fixing gold prices in Shanghai, according to the news report, after several shop owners admitted to the charge.

In a statement posted in Chinese by Chow Tai Fook Jewellery Group Limited this afternoon, the company contended that it has its own gold pricing mechanism, and is not subject to the constraints or restrictions of any association or other jewelry retailers. The company's gold product prices are ''reasonably set based on the cost of raw materials and various operating costs such as design and craftsmanship, while taking the international gold price as a major reference.''  Chow Tai Fook added that its gold jewelry prices were uniform across the country and that there were no regional differences.

Additionally, Chow Tai Fook reiterated that it was a longstanding  Shanghai Gold Jewelry Industry Association member but that  the association is not involved in the company's decision-making process or operations. Further, the company has always abided by laws and regulations, trading principles and legal compliance across its operations.

A spokesperson for Chow Sang Sang told the People's Daily that the company shouldn't have been targeted in the probe because  it sets the gold price every day based on the New York market closing price. The gold price is the same within the whole region of China and Chow Sang Sang doesn't have districting price differences, according to the quote.

Tags: China, Chow Sang Sang, Chow Tai Fook, gold, Jeff Miller, price fixing
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