The Fair Trade Commission has determined that cellphone game site operator DeNA Co. violated antitrust law by requesting more than 40 software developers not to provide their games to rival GREE Inc.
The watchdog said it ordered DeNA, known for its Mobage website, on Thursday to stop such actions and take corrective steps.
DeNA allegedly threatened to remove links to the providers of mobile phone games on the website in an attempt to block their business with GREE, its smaller competitor, according to the FTC.
More than half of the developers gave up offering their products to GREE, the commission said.
DeNA said in a statement it takes the order "sincerely" and will ensure its compliance with the law.
Competition has heated up between DeNA and GREE in their social game services, which allow subscribers to play games interactively on their mobile phones.
Japan's social game market is projected to exceed ¥100 billion in fiscal 2011, according to private research firm Yano Research Institute.
As of March, DeNA had 27.1 million domestic subscribers, compared with 25.1 million for GREE.