Business

Japan antitrust regulator launches survey to assess global IT giants' sway over vendors

Kyodo

Japan’s antitrust watchdog launched Wednesday a survey of transactions involving information technology giants like Apple Inc., Amazon.com Inc. and Google LLC to investigate whether their market dominance may be hindering fair competition.

As part of the survey, company officials will be interviewed to determine whether their companies’ practices apply unjust pressure on individual sellers and smaller firms in violation of the antimonopoly law. Vendors will also be asked to answer an online questionnaire.

“There have been accusations that transactions are opaque and that there have been various disadvantages” for vendors, Akinori Yamada, secretary general of the Japan Fair Trade Commission told a news conference. “There is a need to grasp the actual situation swiftly.”

The tech giants are referred to as “platformers” in Japan, as they provide digital infrastructure, or platforms, for the sale of products and services via search engines, social networking sites and e-commerce sites, among others. The commission’s survey is also expected to cover the nation’s own major online marketplaces such as Rakuten Inc. and Yahoo Japan Corp.

In the questionnaire, vendors will be asked for feedback about whether transaction terms are unilaterally imposed on e-commerce sites and smartphone app stores run by the platform operators, and how their products are screened before going on sale.

The survey may also help the commission get to the bottom of allegations that Amazon intends to force small merchants to shoulder the cost of its plan to start offering reward points to customers for all products sold on its site.

If Amazon Japan introduces the new measure, which is apparently scheduled to start from May, without giving vendors the chance to negotiate terms, it could be deemed an abuse of its superior bargaining position over a counterparty, which is prohibited under the antimonopoly law.

The watchdog has recently stepped up its regulatory scrutiny of the tech giants. Since January, it has asked businesses using their platforms to report any questionable trade practices.

The fair trade commission, the Ministry of Economy, Trade and Industry and the Ministry of Internal Affairs and Communications are also working on new rules to ensure that transactions between companies and platformers are conducted in a transparent and fair manner.