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Recommendations to Usen Corperation and Nippon Network Vision Corperation

September 14/2004
Japan Fair Trade Commission

The Fair Trade Commission has investigated two companies, namely, Usen Corporation and Nippon Network Vision Corporation (hereinafter referred to as “the Two Companies”) based on the provisions of the Antimonopoly Act. The Commission today issued recommendations against the Two Companies based on the provision of the Section 48 (2) of the Act to the effect that the Two Companies violated the provision of Section 3 (Prohibition of private monopolization) of the Act as mentioned in I below.
The Fair Trade Commission also today withdrew its application for an urgent injection order that was filed with the Tokyo High Court based on the provision of Subsection 1 of Section 67 of the Antimonopoly Act on June 30, 2004 as mentioned in II below.

I. Recommendations

1. Related parties

Name Outline of business
Usen Corporation Music broadcasting business
Nippon Network Vision Corporation Agency for business and contracts related to the provision of music broadcasts by Usen Corporation

2. Outline of the violation

The Two Companies conducted a campaign by which they offered only the customers of CANSYSTEM Co., Ltd. a monthly listening fee of less than 3,675 yen or a fee free period of more than three months including a month in which a tuner was installed as conditions for switching over a contract (Note 1) to deprive the customers of CANSYSTEM of its’ customers intensively. Through this activity, the Two Companies conspired and substantially restrained the competition in the field of music broadcasting to the service stores (Note 2) in Japan.

(Note 1) This contract is for the reception of music broadcasts and is entered into with a customer who has already entered into a contract for the reception of music broadcasts with another company.
(Note 2) These stores include shops, stores, hotels and other forms of accommodation.

3. Outline of measures to prevent the violation

(1) The Two Companies shall provide each other with written notification that they will discontinue the violation confirm a termination of the violation in the future. The violation refers to that whereby only the customers of CANSYSTEM are offered a monthly listening fee of less than 3675 yen or a free monthly period of more than three months including the month in which the tuner is installed as a condition for switching over a contract for the reception of music broadcasts by service stores. The Two Companies shall notify CANSYSTEM thereof in writing.

(2) The Two Companies shall not unjustly deprive illegally other entrepreneurs who provide other music broadcasts of their customers through an activity similar to that mentioned in 3 (1) above.

(3) The Two Companies shall take the necessary measures to conduct training concerning the Antimonopoly Act for marketing staff members in charge of music broadcasts to prevent activities similar to that mentioned in 3 (1) above and thoroughly make the details of the measures known to the directors and employees of the Two Companies.

4. Deadline for accepting or rejecting the recommendation

September 27, 2004
(If the recommendation is accepttable, a decision that is the same as the recommendation will be made. If the recommendation is rejected, a hearing procedure will be initiated.)

II. Withdrawal of an Application for an Urgent Injection Order

The Fair Trade Commission filed an application for an urgent injection order to the Two Companies with the Tokyo High Court based on the provision of Section 67(1) of the Antimonopoly Act on June 30, 2004. Thereafter, on July 9, 2004 the Two Companies increased their monthly listening fee to 3675 yen or more and decided that the period for free listening should be within three months including the month in which the tuner is installed. It is acknowledged that the Two Companies discontinued to deprive CANSYSTEM of its customers by offering only the customers of CANSYSTEM a monthly listening fee of less than 3675 yen or a free monthly period of more than three months including the month in which the tuner is installed as conditions for switching over a contract.
Accordingly, it is acknowledged that the purpose of the application has already been achieved. Therefore, the Fair Trade Commission today withdrew its application for an urgent injection order for the Two Companies.

*Every announcement is tentative translation. Please refer to the original text written in Japanese.



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