Business

Japan's antitrust watchdog to study four tech giants to see if fair business regulations are needed

Kyodo

The Fair Trade Commission has decided to launch a massive survey in January into the business practices of internet technology giants, a senior lawmaker said Wednesday.

The planned survey is designed to learn how four large firms that provide online search and shopping services — Google LLC, Apple Inc., Facebook Inc. and Amazon.com Inc. — conduct business and how best to set regulations for dealing with issues that may arise due to their massive economic clout.

The move, revealed at a meeting of ruling Liberal Democratic Party lawmakers, comes amid growing concerns that such technology companies can force unfair deals on smaller business partners due to their overwhelming market shares.

The FTC will compile basic regulatory principles later this month aimed at preventing potential abuse based on their advantageous positions and consider specific measures that may be taken, including rewriting related laws.

While their business partners may decline to cooperate with the commission’s survey by citing confidentiality agreements with the large firms, the commission is ready to utilize a clause in the anti-monopoly law and conduct compulsory inspections, according to the lawmaker.

The government has already learned of cases in which smaller firms have been forced to accept unfair deals with bigger technology companies. But it has not been able to grasp the full extent of the unfair deals due to a reluctance by the smaller firms to cooperate in surveys due to confidentiality clauses.

The compulsory inspections could help the government get a better picture of the issue. But some have raised questions about their efficacy, as failing to comply with the inspections would only draw a small fine that some firms may choose to pay instead of revealing information about their business models.

The commission plans to establish a special organization for monitoring the technology firms by recruiting outside experts who will check whether such unfair business practices are taking place.

The commission held a meeting with a major IT firm last month.

The envisioned monitoring organization is expected to comprise law, economics and information technology experts, among other fields, who will formulate rules and regulations and pass forward information to regulatory authorities.

The commission says data collected from individuals hold economic value and calls for restricting abuse of advantageous positions under the aim of securing transparency and fairness.

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