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A former SoftBank Corp. employee has been arrested on suspicion of illegally disclosing 5G trade secrets to his new employer, Rakuten Mobile Inc., as it was preparing to launch its own mobile network.

The Tokyo Metropolitan Police Department on Tuesday arrested Kuniaki Aiba, 45, on suspicion of leaking secret information in breach of a law preventing unfair competition.

Aiba is suspected of having transferred trade secrets from SoftBank by emailing information on the company's 5G technology to his own account on Dec. 31, 2019, when he was still working for SoftBank, police said.

Soon after, he left SoftBank and joined Rakuten Mobile, according to investigative sources.

The police did not reveal whether or not Aiba has admitted to the allegations.

SoftBank issued a statement saying that confidential 4G and 5G networking plans and technology were among the information compromised, though no client data had been exposed. Rakuten Mobile confirmed Aiba is an employee of the company, which is fully cooperating with the police investigation, according to spokesman Yuta Mizuno.

SoftBank suspects Rakuten Mobile has already used the information, which might be preserved in Aiba's business computer at Rakuten, and plans to file a lawsuit demanding its rival stop using the information and destroy it.

Rakuten Mobile parent company Rakuten Inc. was down as much as 2% in Tokyo on Tuesday, while SoftBank Corp. was up just over 1%.

The incident underscores intensifying competition in one of the world’s most lucrative telecom arenas. Rakuten has been the big disruptor in the space, launching the fourth major network in the country last year and pushing unlimited mobile data allowances.

Rakuten's breakthrough pricing has put pressure on incumbents SoftBank, NTT Docomo Inc. and KDDI Corp. That’s added to a period of unusual upheaval, with mobile carriers urged by new Prime Minister Yoshihide Suga to make their consumer contracts more flexible and affordable while also making the transition to fifth-generation wireless networking.

5G networks and devices are hotly contested ground, promising to open up new applications, business opportunities and, crucially for carriers, supercharge demand for bandwidth.

SoftBank has been among the earliest adopters, though its coverage remains patchy, as it is across most of the globe. Rakuten, whose 5G service launched several months after SoftBank’s, aims to undercut the market with a single-price offering that’s less than half what its rivals charge and still offers unlimited data.

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