Business / Corporate

Three contact lens makers raided in Japan over alleged violations of Antimonopoly Law

JIJI

The Fair Trade Commission raided three contact lens makers Tuesday for allegedly forcing retailers not to list prices on their advertisements in violation of the Antimonopoly Law, it was learned Tuesday.

The antitrust watchdog’s on-site inspections covered Alcon Japan Ltd., CooperVision Japan Inc. and Seed Co. All of them are based in Tokyo.

The three are suspected of forcing retailers not to list the prices of some disposable contact lenses on flyers or online ads, and effectively banning them from selling certain products online.

The makers are believed to have put pressure on retailers that failed to follow their instructions, telling them through wholesalers that the supply of products to them might be suspended.

On their flyers and other ads, retailers used such phrases as “special prices” and “10 percent cuts from shop prices” for some products, without indicating what they were priced as, informed sources said.

Price competition is intense among disposable contact lens retailers as users tend to continue buying the same products.

The three companies apparently attempted to prevent prices of their products from falling as a result of the competition, thereby securing profits, the sources said.

Johnson & Johnson K.K., the industry leader in Japan, was warned by the FTC in 2002 over a similar practice and ordered to halt the practice in 2010.

The Antimonopoly Law bans companies from imposing conditions that unfairly restrict operations of their business partners.

The contact lens market in Japan is worth some ¥230 billion on a shipment value basis, according to the Japan Contact Lens Association.

Over 90 percent of the products used in Japan are disposables, and online sales are growing, according to the association.

The three makers admitted that their offices have been searched by the FTC, adding they will fully cooperate with the investigations.