Four officials of four companies supplying water meters to the Tokyo Metropolitan Government were arrested Wednesday on suspicion of rigging bids, prosecutors said.
The Tokyo District Public Prosecutor's Office said the four are from Aichi Tokei Denki Co., Ricoh Elemex Corp., Takahata Seikou Co. and Toyo Keiki Co..
They are among 19 firms suspected of conspiring to fix bid prices at competitive tenders conducted by the metropolitan government's Waterworks Bureau since around 2000.
The four firms and Kimmon Mfg. Co. are suspected of playing a major role in the case.
Kimmon officials have admitted to the allegation and will likely be questioned along with officials of other firms without being arrested, investigative sources said.
The four arrested officials are suspected of violating the Antimonopoly Law.
Earlier in the day, prosecutors searched the Tokyo branch office of Nagoya-based Aichi Tokei Denki and Kimmon's Tokyo headquarters.
The probe was launched after the Fair Trade Commission filed criminal complaints against the companies with prosecutors that morning.
The FTC conducted an on-the-spot investigation in February into the 19 companies.
In February 1997, the antimonopoly watchdog filed criminal complaints against 25 firms, including Kimmon, in similar cases. The companies received fines ranging between 5 million yen and 9 million yen.
But as Kimmon and the other firms continued to fix bids, the FTC has decided to file criminal complaints again, commission officials said.
Tokyo Metropolitan Government officials said meter prices fell after the FTC's first probe in 1996. A water meter with a diameter of 20 mm cost 2,800 yen in fiscal 1999, down from 7,800 yen in fiscal 1995. However, the price rose to about 3,600 yen in fiscal 2000, when big-rigging is believed to have resumed.