Multinationals Raided By Japan’s Antitrust Watchdog

April 10, 2019 – Japan’s antitrust watchdog on Wednesday raided the offices of Rakuten Inc. and two other online booking operators, alleging they hurt fair trade by requiring accommodation clients offer their lowest prices on their platforms, according to a source close to the matter.

The Japan Fair Trade Commission’s probe comes amid its closer scrutiny of alleged obscure business transactions involving providers of digital platforms for the sale of products and services via search engines and e-commerce sites, among other avenues.

According to the source, Tokyo-based Rakuten, U.S. firm Expedia Group Inc. and Dutch outfit Booking.com B.V. have, for several years, allegedly urged clients to set accommodation prices the same as, or lower than, those they offered on rival websites and on hotels’ official sites.

Rakuten said it “will fully cooperate with the investigation”.

In August 2016, the commission conducted a similar on-site probe of Amazon Japan, on suspicion it signed contracts with suppliers under which they agreed to make their product line-ups and prices competitive, or at least match those on rival online retailers.

The commission terminated its probe in June 2017 once the company retracted such conditions, without ruling whether antitrust law had been violated.

In March last year, the commission again raided Amazon Japan for allegedly violating the antitrust law by having suppliers shoulder part of the costs to cover discounts the retailer applied to goods. That investigation is ongoing.

Airbnb Inc.’s office in Japan also came under investigation by the commission, in October 2017, for allegedly requesting homeowners advertising short-stay properties on its site do so exclusively.

The probe ended a year later after Airbnb said it will remove the requirement.

More recently, the commission launched in February a survey of transactions involving information technology giants including Amazon.com, Apple Inc., and Google LLC to investigate whether their market dominance may be hurting competition.

Meanwhile, the ruling Liberal Democratic Party started its own investigation in March, questioning senior officials of Amazon, Apple, Facebook Inc. and Google as it seeks to compile proposals for Prime Minister Shinzo Abe’s government to ensure fair competition.

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