Japan's Fair Trade Commission may take administrative action against U.S. technology giant Google shortly over its digital advertising business, informed sources said Tuesday.
The FTC has conducted an investigation into Google, suspecting that the company was unfairly restricting transactions of LY, the operator of internet portal Yahoo Japan and messaging app Line, in violation of Japan's antimonopoly law, according to the sources.
In response to the investigation, Google is believed to have voluntarily submitted to the FTC an improvement plan based on a procedure for administrative action prescribed under the law. Under the procedure, Google would be exempt from fines and a cease-and-desist order if the improvement plan is found effective.
Subject to the FTC investigation were so-called search-linked ads in which advertisements linked to keywords used for information search on the internet are displayed, the sources said.
For this type of ad, Google's system had been adopted for Yahoo Japan.
But in the mid-2010s, Google requested Yahoo before the merger that created LY to stop distributing search-linked ads to mobile devices, and Yahoo accepted the request, the sources said. Yahoo was apparently concerned that it would become unable to use the Google system if it refused the request.
The FTC concluded that Google's behavior might constitute an antimonopoly law violation. After the FTC launched the investigation, Google is believed to have withdrawn the request to Yahoo.
The FTC notified Google in March this year that it might be violating the law.
In October last year, the FTC said that it had begun investigating Google on suspicion of unreasonably demanding that smartphone makers favor its search and other services over rival products for their handsets.