October 9, 2024
Japan Fair Trade Commission
Today, I would like to explain the following matters: (1) G7 Competition Authorities and Policymakers’ Summit and (2) Fiscal 2024 Promotion Month for Fair Subcontract Transaction.
G7 Competition Authorities and Policymakers’ Summit
I would like to outline the holding of the G7 Competition Authorities and Policymakers’ Summit (the Summit) and the “Digital Competition Communiqué” that was announced in conjunction with the Summit.
The Summit was held in Rome, Italy on October 3-4, 2024, hosted by the Italian Competition Authority, Autoritá Garante della Concorrenza e del Mercato. At this Summit, the heads of the G7 competition authorities and policymakers, etc. engaged in discussions on various competition issues related to the digital and AI markets. Specifically, on the first day, discussions focused on competition law concerns related to important AI inputs, as well as on issues in downstream and adjacent markets influenced by AI, etc. On the second day, discussions centered around recent developments on regulatory and policy approaches in digital markets, along with regulatory and policy approaches concerning AI markets.
During the summit sessions, the JFTC provided an overview of the market study on generative AI that began on October 2nd, in addition to the Mobile Software Competition Act, which was enacted in June this year. The JFTC also explained the appointment of specialized digital experts, including the newly established position of Digital Analyst.
In particular, regarding the market study on generative AI, the JFTC stated that, while recognizing the potential competition risks posed by generative AI technologies, the JFTC is first conducting a fact-finding study from a neutral standpoint. With the aim of maintaining a fair and free competitive environment in Japan’s generative AI-related markets and fostering further innovation, the JFTC is also focusing on the competition-promoting aspects of generative AI technologies.
In addition, as a concrete outcome of the summit, the “Digital Competition Communiqué” was adopted. This statement includes the following points:
- Creation of innovation by AI
- Competition concerns within the AI
- Guiding principles to ensure that society can fully benefit from AI
- Role of competition and other authorities (vigorous antitrust enforcement, enhancement of international cooperation, etc.)
The JFTC, taking into accounts the discussions at the summit and the “Digital Competition Communiqué,” aims to proceed with the market study on generative AI while considering the benefits generative AI brings to the economy and society, as well as its impact on competition. In doing so, we will work to ensure that generative AI is deployed in a healthy manner within the economy and society. Additionally, we intend to further strengthen international cooperation in this field.
Fiscal 2024 Promotion Month for Fair Subcontract Transactions
The JFTC has been strictly dealing with violation of the Antimonopoly Act (AMA) and the Subcontract Act by applying these laws to those conducts that unfairly disadvantage small and medium-sized enterprises. In addition, in order to prevent such conducts, we are actively implementing public awareness activities related to the Subcontract Act and the Abuse of Superior Bargaining Position, stipulated in the AMA.
As part of these activities, we have designated every November as the “Promotion Month for Fair Subcontract Transactions” and has been intensively working to promote and raise awareness of the Subcontract Act during this period in collaboration with the Small and Medium Enterprise Agency since 1981. During this year’s Promotion Month, we will focus our efforts on promoting the pass-through of labor costs, based on the “Guidelines on Price Negotiation for Appropriate Pass-thorough of Labor Costs” (the Guidelines) that the JFTC, in cooperation with the Cabinet Secretariat, formulated and published in November last year.
With the aim of promoting the period more effectively, we invite the public to submit a campaign slogan and select it each year. For this fiscal year, under the theme of “Ensuring Fair Transactions through the Appropriate Pass-Through of Labor Costs,” we held a public contest. As a result, the slogan “Raising Wages and the Pass-Through of Labor Costs as Two Wheels of the Same Cart” was selected as this fiscal year’s campaign slogan.
We have created posters featuring the campaign slogan and are asking cooperation from various organizations, such as prefectures, the Chamber of Commerce and Industry, and Commerce and Industry Association, etc., to display the posters and publish them in their official newsletters. Through these efforts, we aim to promote and raise awareness of the Guidelines and the Subcontract Act across the country, reaching every corner of Japan.
Next, we will release a new informational video for small and medium-sized enterprises explaining the Guidelines, etc. Additionally, we will expand our video content on the Subcontract Act by adding two new videos to the “Basic Course,” bringing the total to 11 videos, to clearly convey the key concepts and principles of the Subcontract Act.
Furthermore, as part of this FY’s public awareness activities, we plan to release an informational video, in collaboration with government public relations, that summarizes key points for negotiating prices to ensure the pass-through of labor costs based on the Guidelines. The video is currently under production and is scheduled to be released in November this year.
As the JFTC, in collaboration with the Small and Medium Enterprise Agency and other relevant ministries, we will continue our efforts to promote and raise awareness of the Subcontract Act through activities such as the “Promotion Month for Fair Subcontract Transactions.” Additionally, we are committed to strictly enforcing the Subcontract Act and promoting the Guidelines, etc. Our goal is to firmly establish appropriate cost pass-through practices as a new business custom throughout the supply chain in Japan.
(Tentative translation)
The JFTC, taking into accounts the discussions at the summit and the “Digital Competition Communiqué,” aims to proceed with the market study on generative AI while considering the benefits generative AI brings to the economy and society, as well as its impact on competition. In doing so, we will work to ensure that generative AI is deployed in a healthy manner within the economy and society. Additionally, we intend to further strengthen international cooperation in this field.
Fiscal 2024 Promotion Month for Fair Subcontract Transactions
The JFTC has been strictly dealing with violation of the Antimonopoly Act (AMA) and the Subcontract Act by applying these laws to those conducts that unfairly disadvantage small and medium-sized enterprises. In addition, in order to prevent such conducts, we are actively implementing public awareness activities related to the Subcontract Act and the Abuse of Superior Bargaining Position, stipulated in the AMA.
As part of these activities, we have designated every November as the “Promotion Month for Fair Subcontract Transactions” and has been intensively working to promote and raise awareness of the Subcontract Act during this period in collaboration with the Small and Medium Enterprise Agency since 1981. During this year’s Promotion Month, we will focus our efforts on promoting the pass-through of labor costs, based on the “Guidelines on Price Negotiation for Appropriate Pass-thorough of Labor Costs” (the Guidelines) that the JFTC, in cooperation with the Cabinet Secretariat, formulated and published in November last year.
With the aim of promoting the period more effectively, we invite the public to submit a campaign slogan and select it each year. For this fiscal year, under the theme of “Ensuring Fair Transactions through the Appropriate Pass-Through of Labor Costs,” we held a public contest. As a result, the slogan “Raising Wages and the Pass-Through of Labor Costs as Two Wheels of the Same Cart” was selected as this fiscal year’s campaign slogan.
We have created posters featuring the campaign slogan and are asking cooperation from various organizations, such as prefectures, the Chamber of Commerce and Industry, and Commerce and Industry Association, etc., to display the posters and publish them in their official newsletters. Through these efforts, we aim to promote and raise awareness of the Guidelines and the Subcontract Act across the country, reaching every corner of Japan.
Next, we will release a new informational video for small and medium-sized enterprises explaining the Guidelines, etc. Additionally, we will expand our video content on the Subcontract Act by adding two new videos to the “Basic Course,” bringing the total to 11 videos, to clearly convey the key concepts and principles of the Subcontract Act.
Furthermore, as part of this FY’s public awareness activities, we plan to release an informational video, in collaboration with government public relations, that summarizes key points for negotiating prices to ensure the pass-through of labor costs based on the Guidelines. The video is currently under production and is scheduled to be released in November this year.
As the JFTC, in collaboration with the Small and Medium Enterprise Agency and other relevant ministries, we will continue our efforts to promote and raise awareness of the Subcontract Act through activities such as the “Promotion Month for Fair Subcontract Transactions.” Additionally, we are committed to strictly enforcing the Subcontract Act and promoting the Guidelines, etc. Our goal is to firmly establish appropriate cost pass-through practices as a new business custom throughout the supply chain in Japan.
(Tentative translation)
