Approval of the Commitment Plans submitted by Amer Sports Japan, Inc. and Wilson Sporting Goods Co.

March 25, 2022
Japan Fair Trade Commission
 

The Japan Fair Trade Commission (hereinafter referred to as the “JFTC”) has investigated Amer Sports Japan, Inc. (hereinafter referred to as “ASJ”) and Wilson Sporting Goods Co. (hereinafter referred to as “Wilson”) in accordance with the provisions of the Antimonopoly Act (hereinafter referred to simply as the “Act”), and suspected that the conducts by ASJ and Wilson mentioned in 2 below might fall under Interference with a Competitor’s Transactions prescribed in paragraph (14) of the Unfair Trade Practices designated pursuant to Article 2, paragraph (9), item (vi) of the Act ,and that ASJ and Wilson might violate Article 19 of the Act. Recognizing that competition may be promptly restored, through the Commitment Procedure, by measures taken by ASJ and Wilson in a timely manner to eliminate the conducts, the JFTC issued the Notice of Commitment Procedures (hereinafter referred to simply as the “Notice”)  to ASJ and Wilson on December 24, 2021, pursuant to Article 48-6 of the Act.
     In response to the Notice, ASJ and Wilson, respectively, submitted an application for approval of the measures necessary to eliminate the conducts mentioned in 2 below (hereinafter referred to as the “Commitment Plan”), pursuant to Article 48-7, paragraph (1) of the Act. The JFTC recognized that the Commitment Plan would conform to both of the following approval requirements: (i) the measures are sufficient for eliminating the conducts mentioned in 2 below, and (ii) the measures are expected to be reliably conducted; hence, the JFTC approved the Commitment Plan pursuant to Article 48-7, paragraph (3) of the Act today.
It is noted that the JFTC’s approval of the Commitment Plan does not represent the determination that the conducts of ASJ and Wilson constituted the violation of the Act.

(Note 1)  An approval of the Commitment Plan is an administrative disposition under the Act.
(Note 2)  The JFTC may render a decision to rescind the approval and resume the investigation procedure conducted before the Notice is issued, pursuant to Article 48-9, paragraph (1) of the Act, for instance, if the JFTC recognizes that the Commitment Plan is not being conducted according to the approved Commitment Plan.

1. Overview of the Applicants
(1) ASJ

(2) Wilson

2. Overview of the Suspected Violation of the Act
Around from September 2016 at the latest to September, 2020, ASJ, which is a Wilson subsidiary, obtained legitimate/non-counterfeit Wilson performance tennis racquets (hereinafter referred to as “Tennis Racquets”) which are one type of hard-ball tennis racquets for advanced players manufactured by Wilson and sold through itself or affiliated companies of its company group (including ASJ, hereinafter referred to as “its Affiliates”), that had been imported from overseas authorized retailers (Note 3) (hereinafter referred to as “Parallel-imported Goods”) by importers in Japan who deal in Parallel-imported Goods (hereinafter referred to as “Parallel Importers”), informed Wilson of information on hologram seals (Note 4) attached to the Parallel-imported Goods, and asked Wilson to identify from such information overseas authorized retailers who sold the Parallel-imported Goods to the Parallel-Importers and then to make such overseas authorized retailers not sell the Tennis Racquets to Parallel-Importers. In response to this, Wilson warned certain identified overseas authorized retailers not to sell Tennis Racquets to Parallel Importers in Japan including because of documents that prohibit sale of Tennis Racquets outside appointed sales areas.

(Note 3) Retailers who are located outside of Japan and approved by Wilson to sell Tennis Racquets to customers outside of Japan.
(Note 4) Seals attached to Tennis Racquets by Wilson which have serial numbers to protect the integrity of the Tennis Racquets.

3. Parallel-Imported Goods and the effects caused by the conducts
The price of Parallel-Imported Goods which Parallel-Importers sold, mentioned in 2 above, was lower than that of Tennis Rackets ASJ sold through retailers.
There existed some Parallel-Importers whose transactions were interfered because of the conducts mentioned in 2 above.

4. Overview of the Commitment Plan
(1) ASJ
 A. The board of directors of ASJ will resolve the following matters:
   (a) to confirm that ASJ has already ceased the conducts mentioned in 2 above
   (b) not to perform the same conducts mentioned in 2 above for the next three years.

 B. ASJ will give a notice in the joint names of ASJ and Wilson on the measures in accordance with A above, to the Parallel-Importers.

 C. ASJ will disseminate the measures in accordance with A above to all of its employees (excluding part-time workers).

 D. ASJ will not perform the same conducts mentioned in 2 above with respect to Tennis Racquets sold to Japan for the next three years.

E. ASJ will take necessary measures to do the following:
  (a)Establishment of directors who are responsible for legal/compliance business
  (b)Revision of the company rules to clarify conducts which may violate the Act and dissemination of the rules revised to its employees
  (c)Regular training on compliance of the Act in terms of the business activities related to the Tennis Racquet to employees of ASJ who are involved in sales or marketing of the Tennis Racquets and those who guide and supervise them for the next three years
  (d)Regular audit on compliance of the Act in terms the Tennis Racquet for the next three years.

F. ASJ will report to the JFTC upon implementation of the measures mentioned in A through C and E above.

G. ASJ will report to the JFTC upon implementation of the measures mentioned in D and the measures taken based on E(c) and (d) above on an annual basis for the next three years.

(2) Wilson
 A. The board of directors of Wilson will resolve the following matters:
   (a) to confirm that Wilson has already ceased the conducts mentioned in 2 above
   (b) not to perform the same conducts mentioned in 2 above with respect to Tennis Racquets sold to Japan; and even without a request from ASJ mentioned in 2 above, not to enforce any policy ,with respect to sales in Japan, either directly or through its Affiliates (excluding ASJ), restricting the sale of Tennis Racquets by authorized retailers located in other countries to Parallel-Importers in response to requests from such Parallel-Importers for resale of such Tennis Racquets to consumers in Japan (hereinafter referred to as “Passive Selling”), for the next three years.

B. Wilson will post on its website a notice on the measures taken by Wilson in accordance with A above for a period of 6 months from the date of the post.

C. Wilson will give a notice in the joint names of ASJ and Wilson on the measures in accordance with A above, to the Parallel-Importers from whom ASJ purchased Tennis Racquets after September 2016.

D. Wilson will give a notice on the measures taken based on A above to its parent company, Amer Sports Corporation, and its Affiliates (excluding ASJ) that sell Tennis Racquets.

E. Wilson will disseminate the measures taken based on A above to all of its employees of the Company in the Tennis Racquets commercial distribution business and to all the management employees of its Affiliates (excluding ASJ) in the Tennis Racquets commercial distribution business.

F. Wilson will not perform the same conducts mentioned in 2 above with respect to Tennis Racquets sold to Japan; and even without a request from ASJ in 2 above, not to enforce any policy, with respect to sales in Japan, either directly or through its Affiliates (excluding ASJ), restricting the Passive Selling, for the next three years.

G. For the next three years, Wilson will take necessary measures to do the following:
  (a)In order to ensure that the conducts mentioned in 2 above will not be performed again, (i) the preparation of documents clarifying that Amer Sports’ Code of Conduct includes compliance with all the competition laws; (ii) a re-notification to all the employees of Wilson in the Tennis Racquets commercial distribution business that the conducts mentioned in 2 above  may cause problems under the Act; (iii) the dissemination of the documents to all the employees of Wilson in the Tennis Racquets commercial distribution business
  (b)Regular training by the legal personnel or outside experts with regard to ensuring that the conducts mentioned in 2 above will not be performed again, to all the employees of Wilson in the Tennis Racquets commercial distribution business
  (c)Regular audit by the legal personnel or outside experts to ensure that the conducts mentioned in 2 above have not been performed again at Wilson in the Tennis Racquets commercial distribution business.

 H. Wilson will report to the JFTC upon implementation of the measures mentioned in A through E and G above.

 I. Wilson will report to the JFTC upon implementation of the measures mentioned in F and the measures taken based on G(b) and (c) above on an annual basis, for the next three years.

5. Approval of the Commitment Plan
The JFTC recognized that the Commitment Plan mentioned in 4(1) and (2) above would conform to all the approval requirements and approved the Commitment Plan.

* Every announcement is tentative translation.