January 18/2010
Japan Fair Trade Commission
I was appointed Chairman of the Japan Fair Trade Commission (JFTC) in 2002, so 2010 marks the eighth year of my tenure. As we begin a new year, the JFTC stands committed to the continued rigorous enforcement of the Antimonopoly Act and the Subcontract Act.
One of the most important tasks that the JFTC faces in 2010 is the enforcement of the revised Antimonopoly Act that went into effect on January 1, 2010. The Antimonopoly Act underwent major revisions in 2005, which included the introduction of a leniency program and the assignment of compulsory criminal investigation powers to the JFTC. To follow up on the 2005 amendment,further amendments, including a revision of the surcharge system, were adopted and enacted in the ordinary session of the Diet in 2009. All preparations for the enforcement of the new Antimonopoly Act have now been completed, including the issuance of related government ordinances and the pertinent revision of JFTC regulations and guidelines.
The main features of the most recent amendment of the Antimonopoly Act are as follows. First, the scope of violations subject to surcharges has been expanded to include exclusionary types of private monopolization and the abuse of dominant bargaining position. Furthermore, surcharges will also be applicable to sales at unjustly low prices, discriminatory pricing, concerted refusal to trade, and restriction of resale price on and after the second offense of the same type of infringement within a ten-year period.
A number of other revisions have also been made in the surcharge system. These include the imposition of higher surcharge rates on businesses that have played a leading role in cartels and bid-riggings; joint application for leniency by multiple numbers of enterprises belonging to the same corporate group; increase in the number of enterprises that can apply for leniency in a single infringement case; and extension of the statute of limitations for the issuance of surcharge payment orders.
The amendment of the Antimonopoly Act also contains provisions for a pre-notification system for the acquisition of shares and the imposition of a longer sentence of imprisonment in cases involving unreasonable restraints of trade. The JFTC believes that these newly introduced systems must be effectively and appropriately applied in order to deter and to eliminate violations of the Antimonopoly Act at the earliest possible stage.
Regarding future amendments of the Antimonopoly Act, in December 2009, the politicians holding the top three ranks in the Cabinet Office in charge of the JFTC finalized a basic policy concerning the review of the JFTC hearings and examination system. Under this policy, an amendment for totally abolishing the hearings and examination system is to be submitted to the forthcoming ordinary session of the Diet. Responding to this decision, the JFTC will now engage in drafting the necessary amendment bill.
In November 2009, the JFTC launched the "Program for Promoting Fair Trade with SMEs." Given the very difficult economic conditions that persist today, this program aims to ensure and promote fair trade with small and medium-sized enterprises (SMEs) that are frequently prone to be adversely affected by unjust pressures brought upon them in transactions with large corporations. The program is designed around the following four key principles and initiatives:advisory services and public relations activities reflecting the perspective of SMEs; promoting compliance in large corporations and parent companies; special investigation of areas other than subcontracting that have strong needs for promoting fair trade with SMEs; and prioritized and effective action against violations. Based on this framework, the JFTC is currently engaged in the following services and activities for SMEs: traveling advisory meetings; lecture and training programs for specific industries; questionnaire surveys of transactions between large-scale retailers and their suppliers, and shippers and distribution and transport enterprises; and the establishment of a taskforce on violations involving abuse of dominant bargaining position. As SMEs continue to face severe business conditions, the JFTC is committed to steadily implementing the Program for Promoting Fair Trade with SMEs in order to actively prevent and to reinforce its measures against unfair trade practices that are detrimental to SMEs.
Finally, I would like to comment briefly on the subject of international cooperation. Faced with a growing number of anti-competitive conducts and corporate combinations that exert a serious impact on the markets of multiple countries and regions,cooperation with overseas competition authorities in the enforcement of competition laws has become increasingly common. The JFTC is committed to strengthening its cooperative relations with overseas competition authorities through active participation in such international organizations as the International Competition Network (ICN) and the Organisation for Economic Co-operation and Development (OECD). Furthermore, the JFTC will continue to hold periodic discussion meetings with the competition authorities of the United States, the European Union, and other countries and regions. We will also continue to actively support the East Asia Competition Policy Forum that brings together the top-level officials on competition policy from the East Asian region. We are mindful that many countries have only recently established their competition authorities and that many more are currently in the process of drafting their competition laws. The JFTC stands prepared to provide technical assistance to such countries,primarily in the East Asian region. In 2010, the JFTC will host the ICN Cartel Workshop. We earnestly hope that this international conference will play an important catalytic role in promoting greater cooperation among competition authorities in both the enforcement of competition laws and related technical matters.
In 2010, the JFTC will remain committed to appropriate and effective policy enforcement starting with the issues discussed above, and to meeting the nation's expectations by performing our duties and responsibilities.
*Every announcement is tentative translation. Please refer to the original text written in Japanese.
