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JFTC issues recommendation to Uny Co., Ltd.

December 9/2004
Japan Fair Trade Commission

After having an investigation into suspected violations of the Antimonopoly Act, the Fair Trade Commission today issued the following recommendation to Uny Co., Ltd. (hereinafter referred to as “Uny”)pursuant to the provisions in Section 48(1) and (2) of the Antimonopoly Act on the grounds of its violation of the provisions in Section 19 of the said law, which fall under the category of Items 4 and 6 of Specific Unfair Trade Practices in the Department Stores Business and to Section 14(2) of Unfair Trade Practices (Abuse of Dominant Bargaining Position).

(Note) The Department Stores Business refers to the business of retailing a wide variety of goods for daily use by consumers at a shop with the sales floor of 3,000 (or 1,500 in any municipality excluding special wards and ordinance designated cities) square meters or more.

1. Acts in Violation

(1) Uny has unilaterally instructed their business partners intermediate wholesalers of fruit and vegetables that are in a weaker trade position to deliver fruit and vegetables at below-cost prices for sales entitled “Special Thanks Day” or “Sale for Select Customers” and for other sales called “Tuesday Special Offers”. In so doing, Uny has been forced its suppliers to deliver such products at prices that are considerably lower than the general wholesale prices of products that are comparable in terms of grade, place of origin and other factors.
(2) For sales held to open a new branch store or reopen a shop after refurbishment and for sales entitled “Special Thanks Day,” or “Sale for Select Customers,” Uny has been forcing suppliers of food, clothing and household products that are in a weaker trade position and that have ongoing business relations with Uny to dispatch employees and other staff to display and restock products and place purchased products into bags for shoppers.
(3) Exploiting its business relations, Uny repeatedly pressured the suppliers to dispatch employees and other staff to assist Uny with stocktaking.

2. The Elimination Measures

(1) Uny shall cease the acts described in 2(1) and 2(2), above.
(2) The board of directors of Uny shall adopt a resolution to confirm that the practice described in 1(3), above, has been ceased.
(3) Uny shall notify the intermediate wholesalers and suppliers mentioned above that have ongoing business relations with it of the measures taken in accordance with 3(1) and 3(2) above and that it will never conduct any act comparable to the acts described in 2, above. In addition, Uny shall make these facts known to its employees.
(4) Uny shall conduct no act comparable to the acts described in 2, above in the future.
(5)For the purpose of ensuring that no event similar to those described in 2, above, will take place in future, Uny shall create an action agenda on compliance with the Anti-Monopoly Law, give training on the Anti-Monopoly Law based on the action agenda to its staff responsible for procurement and take necessary action for periodical audits conducted by the staff responsible for legal affairs.

3. Deadline for the Notification of Acceptance or Non-Acceptance of the Recommendation December 20, 2004
(If the recommendations is accepted, a decision consisting of the same items contained in this recommendation shall be issued, if not hearing procedure shall commence.)

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

Japan Fair Trade Commission:

100-8987 1-1-1 Kasumigaseki, Chiyoda-ku, Tokyo,Japan
Tel: +81-3-3581-1998
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