Prosecutors on Monday raided the headquarters of leading contractors Kajima Corp. and Shimizu Corp. in Tokyo over alleged antitrust violations linked to maglev construction tenders.
Kajima and Shimizu are among the four major construction firms that won contracts for the magnetic-levitation line that will shorten the shinkansen trip between Tokyo and Osaka to about an hour.
The companies are suspected of conspiring to determine which contractor would win which orders ahead of the bidding. The special investigation squad of the Tokyo District Public Prosecutor’s Office is looking into the case with the Japan Fair Trade Commission.
According to Central Japan Railway Co. (JR Tokai), which launched the ¥9 trillion ($80 billion) maglev project, Kajima, Shimizu and two other major contractors, Obayashi Corp. and Taisei Corp., won contracts for 15 of the 22 construction tenders put out.
Both Kajima and Shimizu said they will cooperate with the investigation. Kajima said four other locations, including a civil engineering branch office adjacent to its headquarters, were also searched.
Earlier this month, the prosecutors raided the headquarters of Obayashi for alleged fraudulent obstruction of business in the tender process that resulted in an Obayashi-led consortium winning a ¥9 billion contract in April 2016 to build an emergency exit on a section of the line in Nagoya.
After questioning executives of the four major construction firms on a voluntary basis and analyzing confiscated materials, the prosecutors apparently came to suspect the companies violated antitrust law by repeatedly holding advance negotiations on potential tender winners and bids.
Obayashi, Shimizu and Taisei won four contracts each while Kajima secured three to build separate sections of the maglev project.
Once finished, JR Tokai will be running the world’s first train to use superconducting magnetic levitation technology. This will give the maglev trains a top speed of 500 kph, much faster than current bullet trains.
JR Tokai aims to start the new high-speed services between Tokyo’s Shinagawa Station and Nagoya in 2027, and extend the line to Osaka by 2045. The government has provided ¥3 trillion to the railway in a bid to get the Tokyo-Osaka maglev service up and running eight years earlier than planned.
Meanwhile, informed sources said Sunday that a JR Tokai employee suspected of leaking an assumed contract price and other undisclosed data related to the project to Obayashi, may have also provided the information to rival contractor Kajima.
The employee admitted the information leak to Kajima in questioning by the special investigation squad, the sources said.
According to the sources, the JR Tokai employee admitted providing a contract price the railway had assumed and other information to both Obayashi and Kajima during the second stage of bidding.
A person related to Obayashi said, “Sometimes, bidders are informed of assumed prices, and then negotiations are conducted to hold down the contract prices to those levels, so I think that this type of practice is not illegal.”