May 10, 2023
Japan Fair Trade Commission
(Enactment of the Act on the Improvement of Transactions Pertaining to Specified Entrusted Business Operators)
Today, I will talk about two things, but first I will talk about the enactment of the Act on the Improvement of Transactions Pertaining to Specified Entrusted Business Operators.
The Grand Design and Action Plan for New Form of Capitalism, approved by the Cabinet in June 2022, stipulates that, with regard to the freelance workers, “the legal systems for fair transactions should be studied and submitted to the Diet as soon as possible”. Based on this, the Bill on Improvement of Transactions Pertaining to Specified Entrusted Business Operators (commonly known as the Bill on Improvement of Transactions between freelancers and undertakings) was approved by the Cabinet and submitted to the Diet on February 24, 2023 after the study led by the Cabinet Secretariat, with the Japan Fair Trade Commission, the Ministry of Economy, Trade and Industry, the Small and Medium Enterprise Agency, and the Ministry of Health, Labour and Welfare. The bill was then deliberated in the Diet, where it was unanimously passed in both the plenary session of the House of Representatives on April 6 and the plenary session of the House of Councilors on April 28, before Golden Week.
In view of the increasing diversification of work styles, this act aims to create an environment in which individuals can stably engage in the work entrusted to them as business operators, requires ordering enterprises to clarify their contracts in documents or otherwise and to pay freelancers in trade within 60 days in principle, and prohibits them from reducing the amount and unjustly setting the proceeds at a level conspicuously lower than the price ordinarily paid for the same or similar content of work in case of entrusting business to freelancers on a continuous basis for a certain period of time. In addition, in order to improve the work environment for freelancers, the act imposes duties on ordering enterprises to prepare the necessary systems including consultation and other support relating to problem of harassment of freelancers, and to give notice at least 30 days prior to the date of termination, in principle, in the event that business operations that continue for a certain period of time are terminated without cause.
The enforcement of this act is scheduled to begin on the date specified by a Cabinet Order within one year and six months from the promulgation of the act, and a Cabinet Order, Rules and Guidelines for its implementation will be formulated, going forward. The Japan Fair Trade Commission, in coordination with the relevant ministries and agencies, intends to ensure that preparations for the enforcement of this act and publicity activities are carried out.
(Remarks at the General Meeting of the President(Meeting with European Commission Executive Vice-President Vestager))
Next, I will talk about the meeting that took place on the 28th of last month, between Chair of the Japan Fair Trade Commission, Mr. Furuya and European Commission’s Executive Vice-President、Ms. Margrethe Vestager.
The meeting was held in Tokyo in conjunction with the visit of Executive Vice-President Vestager, who is in charge of digital and competition policy at the European Commission, to attend the G7 Digital and Technology Ministers' Meeting held on the 29th and 30th of last month. On February 12, 2021, Chair Furuya and Executive Vice-President Vestager held a web meeting, but the meeting of this time was the first face-to-face meeting.
During the meeting, there were active questions and answers and an exchange of views on recent developments in competition law and policy in both Japan and the EU, including initiatives in the digital market and efforts to realize a green society. Although the time was limited, we believe that the face-to-face exchange of views between the top leaders was very meaningful in strengthening cooperation between competition authorities.
The Japan Fair Trade Commission would like to continue the dialogue between Japan and the EU on a broad level and further strengthen cooperation by deepening mutual understanding through actively holding such meetings between top leaders of competition authorities.
（Tentative translation）
Today, I will talk about two things, but first I will talk about the enactment of the Act on the Improvement of Transactions Pertaining to Specified Entrusted Business Operators.
The Grand Design and Action Plan for New Form of Capitalism, approved by the Cabinet in June 2022, stipulates that, with regard to the freelance workers, “the legal systems for fair transactions should be studied and submitted to the Diet as soon as possible”. Based on this, the Bill on Improvement of Transactions Pertaining to Specified Entrusted Business Operators (commonly known as the Bill on Improvement of Transactions between freelancers and undertakings) was approved by the Cabinet and submitted to the Diet on February 24, 2023 after the study led by the Cabinet Secretariat, with the Japan Fair Trade Commission, the Ministry of Economy, Trade and Industry, the Small and Medium Enterprise Agency, and the Ministry of Health, Labour and Welfare. The bill was then deliberated in the Diet, where it was unanimously passed in both the plenary session of the House of Representatives on April 6 and the plenary session of the House of Councilors on April 28, before Golden Week.
In view of the increasing diversification of work styles, this act aims to create an environment in which individuals can stably engage in the work entrusted to them as business operators, requires ordering enterprises to clarify their contracts in documents or otherwise and to pay freelancers in trade within 60 days in principle, and prohibits them from reducing the amount and unjustly setting the proceeds at a level conspicuously lower than the price ordinarily paid for the same or similar content of work in case of entrusting business to freelancers on a continuous basis for a certain period of time. In addition, in order to improve the work environment for freelancers, the act imposes duties on ordering enterprises to prepare the necessary systems including consultation and other support relating to problem of harassment of freelancers, and to give notice at least 30 days prior to the date of termination, in principle, in the event that business operations that continue for a certain period of time are terminated without cause.
The enforcement of this act is scheduled to begin on the date specified by a Cabinet Order within one year and six months from the promulgation of the act, and a Cabinet Order, Rules and Guidelines for its implementation will be formulated, going forward. The Japan Fair Trade Commission, in coordination with the relevant ministries and agencies, intends to ensure that preparations for the enforcement of this act and publicity activities are carried out.
(Remarks at the General Meeting of the President(Meeting with European Commission Executive Vice-President Vestager))
Next, I will talk about the meeting that took place on the 28th of last month, between Chair of the Japan Fair Trade Commission, Mr. Furuya and European Commission’s Executive Vice-President、Ms. Margrethe Vestager.
The meeting was held in Tokyo in conjunction with the visit of Executive Vice-President Vestager, who is in charge of digital and competition policy at the European Commission, to attend the G7 Digital and Technology Ministers' Meeting held on the 29th and 30th of last month. On February 12, 2021, Chair Furuya and Executive Vice-President Vestager held a web meeting, but the meeting of this time was the first face-to-face meeting.
During the meeting, there were active questions and answers and an exchange of views on recent developments in competition law and policy in both Japan and the EU, including initiatives in the digital market and efforts to realize a green society. Although the time was limited, we believe that the face-to-face exchange of views between the top leaders was very meaningful in strengthening cooperation between competition authorities.
The Japan Fair Trade Commission would like to continue the dialogue between Japan and the EU on a broad level and further strengthen cooperation by deepening mutual understanding through actively holding such meetings between top leaders of competition authorities.
（Tentative translation）
