Business

Sellers ask antitrust body to probe Rakuten's free shipping policy

Kyodo

Merchants on Rakuten Inc.’s online shopping mall have requested that the Fair Trade Commission investigate the e-commerce giant’s planned free shipping policy, according to sources familiar with the move.

Some online stores allege that Rakuten abuses its dominant position to force them to shoulder shipping costs in violation of the antimonopoly law, the sources said Saturday.

If the commission orders the operator to revise the policy, it could affect competition with rivals such as Amazon Japan G.K., which ships products at low cost through its own distribution network.

The commission has been stepping up surveillance and regulations on Rakuten and other so-called online platformers.

Some merchants are preparing to set up a union so they can negotiate with Rakuten as a group, according to the sources.

But it is not immediately known whether the operator will respond to a call for negotiations.

In March, Rakuten plans to start free shipping on all orders exceeding ¥3,980, except those from Okinawa Prefecture and remote islands.

At present, merchants on Rakuten’s online shopping mall independently set shipping fees for each item, with some providing free shipping and others offering no such services.

Small-scale sellers say they cannot survive without passing on shipping costs to customers, a move that would make them less competitive than major merchants.

However, Rakuten officials argue a free-shipping service for a minimum purchase amount would increase the number of customers and the amount of purchases, which would benefit merchants in the long term.

About 49,000 merchants are taking part in Rakuten’s online shopping mall, generating a total of some ¥3.4 trillion in transaction last year, making it one of the biggest players in Japan.