The Fair Trade Commission ordered four firms closely linked to Japan Highway Public Corp. on Tuesday to stop rigging bids for road maintenance work ordered by the corporation.
The antitrust watchdog also urged Japan Highway to improve its bidding procedures, saying it has been leaking key information to so-called family companies, enabling them to repeatedly arrange the outcome of such bids.
The four companies are road maintenance and management firms in Kagawa, Hiroshima and Okayama prefectures that have hired retired Japan Highway officials as executives and enjoyed lucrative business with the company.
The FTC also issued warnings to 27 other "Japan Highway family" companies on similar bid-rigging charges.
According to the FTC, the four companies consulted with each other about road maintenance projects ordered by the Shikoku branch of Japan Highway and arranged it so that one of them -- Shikoku Road Service -- could win all of the contracts.
The FTC suspects the four carried out the illegal practice repeatedly from June 1997 to December 2001.
During this period, Japan Highway's Shikoku branch opened bidding on six road maintenance projects, all of which were won by Shikoku Road Service, based in Takamatsu, Kagawa Prefecture, for a total of 1.45 billion yen.
The FTC also suspects that Japan Highway encouraged the illegal practice by, for example, leaking information on technical requirements on certain projects to the so-called family companies.
The watchdog urged Japan Highway to end such practices and ordered it to report on the relevant measures it will take.