NOTES"An extract from The Handbook of Competition Enforcement Agencies 2015
- www.GlobalCompetitionReview.com."

THE HANDBOOK OF COMPETITIONENFORCEMENT AGENCIES

2015
A Global Competition Review special reportpublished in association with:
Atsumi & Sakai

GCR
GLOBAL COMPETITION REVIEW

www.globalcompetitionreview.com
www.globalcompetitionreview.com

379

JAPANOverview
Setsuko Yufu, Atsushi Iritani, Tatsuo Yamashima and Saori Hanada
Atsumi & Sakai

The Japan Enforcement Agency

The substantive provisions of Japan’s competition
rules are contained in the Antimonopoly Act of Japan(AMA). The Japan Fair Trade Commission (JFTC) is
the principal enforcement agency, which was established as an independent administrative office withbroad enforcement powers and is composed of a chairman and four commissioners. The AMA comprises
four major categories of regulations:•	the prohibition of unreasonable restraint of trade(eg, cartels and bid rigging);• the prohibition of private monopolisation;• the prohibition of unfair trade practices; and•	regulations on business combination (eg, via mergers and acquisitions).
The JFTC is the sole enforcement agency, except in
the case of criminal investigations where the publicprosecutor’s office is in charge of criminal prosecutions
upon the JFTC’s submission of a criminal accusation tothe prosecutor general.
Recent developments
Cartels

The JFTC issued formal administrative orders (ceaseand-desist and surcharge orders) for 13 cartel casesin 2014. In March 2014, a total of ¥22.7 billion insurcharges were levied against four shipping operators
for price-fixing cartels on international ocean-shipping
services for automobiles, the second-highest amountlevied in a single case in the JFTC’s history. The amountof surcharges levied in cartel cases is calculated as thebase rate (which is basically 10 per cent, but differs
according to conditions, increased to 15 per cent if any
cartel activity is repeated within 10 years of an earlier
finding of a breach in respect of the same matter) of thesales amount of the relevant products or services by theparty fined for the period of infringement, extending
up to three years from the date such conduct ceased.
Surcharges imposed for cartel conduct, as well as abuseof superior bargaining position, totalled ¥30.2 billion
in the 2013 fiscal year.
Regarding criminal investigations, the JFTC founda criminal violation of the AMA in the Bearings cartel
174

case and filed criminal accusations with the prosecutor
general in June 2012 against three companies, as well
as seven individuals of the three companies accused,
who were engaged in sales of bearings. No criminal
accusations were filed against the immunity applicant
company and its employees. By February 2013, twocompanies and five individuals were convicted. A trial
went on in relation to one company and two individuals that pleaded not guilty, but all of them were also
convicted in February 2015. The company reportedly
appealed the judgment immediately. The JFTC also
opened its investigation into the Hokuriku Shinkansen
bid-rigging case in September 2013. In March 2014,
criminal accusations were filed against eight equipment
companies and eight individuals, and by 15 November
2014 all the defendant companies and individuals wereconvicted. In this case, the JFTC also found that theprocurer had divulged information to certain bid participants about the upper price that should have been
kept confidential before bidding. Concerned aboutsuch involvement of a procurer in the bidding process,the JFTC demanded that the procurer take appropriate
measures to prevent recurrence.
The JFTC has reiterated its policy of continuing
tough, high-impact enforcements, as well as strengthening cooperation with foreign authorities for the
purpose of deterring infringements. The JFTC hasentered into bilateral cooperation agreements withthe competition authorities of the United States, theEuropean Union and Canada. Under these agreements, various levels of information exchanges anddiscussions can be made between the participatingauthorities. The JFTC is entitled to exchange information with other authorities as well, based on conditions
set out in the AMA.
Leniency

In the 2013 fiscal year, 50 leniency filings were made.
According to a JFTC press release, leniency applicantsreceived immunity or a reduction in surcharges in 12
out of 17 cartel cases in which the JFTC issued a formal
administrative order in the 2013 fiscal year.
Under the leniency programme in Japan, amaximum of five companies (or groups of companies)
The Handbook of Competition Enforcement Agencies 2015

JAPANwill be granted immunity from, or a reduction in,surcharges by identifying the alleged facts in detailand submitting relevant evidence. The first applicant tocome forward before the start of a JFTC investigation
is granted full immunity, the second is granted a 50
per cent reduction, and the third, fourth and fifth aregranted a 30 per cent reduction. Any applicants after
the start of a JFTC investigation are granted the same
30 per cent reduction. The JFTC has no discretion in
determining the order of leniency applicants or the per
centage of reduction granted for cooperation.
Unfair trade practices

In June 2014, the JFTC issued a cease-and-desist
order and a surcharge order imposing a ¥1.27 billion
surcharge against DIREX, a supermarket operator inKyushu, for abuse of its superior bargaining position.
This was the fifth case since the enforcement of amendments to the AMA commenced in January 2010 that
subjected abusers of a superior bargaining position toa surcharge. DIREX, however, was dissatisfied with theorders and requested a hearing. Following the request,
the JFTC commenced hearing proceedings, and a decision on the original orders will be issued by the JFTC
once proceedings are complete. Hearing proceedings
have commenced for all the cases in which surchargeorders were issued for abuse of superior bargaining
position under the amended AMA, which took effectin January 2010.
The base rate for calculating the amount of surcharges for the abuse of a superior market position is
1 per cent of the sales amount of the relevant products
for the period of infringement, extending up to three
years from the date such conduct ceased.
The JFTC is not required to demonstrate a restriction of competition in order to prove the occurrence ofan abuse of a superior bargaining position in violation

www.globalcompetitionreview.com

of the AMA. In contrast, private monopolisation –similar to an abuse of a dominant position under EU
competition law – requires a restriction of competition
by a party having a market share in the relevant market
exceeding around 50 per cent.
Mergers

The total number of merger notifications for the 2013
fiscal year was 264. The JFTC cleared 257 cases without
Phase II review and, among those, the 30-day waiting
period, where the notified transaction shall not beclosed, was shortened in 80 cases. Only four cases
transitioned to Phase II review. Under Phase II review,
one case was cleared subject to conditions and theother three cases were cleared without any conditions.
There were no formal prohibition decisions in the 2013
fiscal year.
Mergers, business transfers, corporate splits (ordemergers), joint share transfers and share acquisitions(including joint ventures) are subject to prior notification under the AMA if they exceed certain thresholds.
Amendments to the AMA, which became effective inJanuary 2010, have introduced mandatory notificationof foreign-to-foreign mergers between undertakingsthat have no Japanese subsidiary or branch office inJapan but that have substantial domestic turnover inJapan (eg, BHP Billiton/Rio Tinto).
Enforcement of the 2013 AMA Amendment

In December 2013, the Diet approved a bill for theamendment of the AMA that aimed to abolish the current administrative hearing proceedings in favour of amore detailed judicial appeal process. This amendment
became effective on 1 April 2015, and parties dissatisfied with the JFTC’s administrative orders will be ableto appeal the orders to the Tokyo district court insteadof requesting JFTC hearings.

175

JAPAN

Setsuko Yufu
Atsumi & Sakai

Atsushi Iritani
Atsumi & Sakai

Setsuko Yufu is a senior partner at Atsumi & Sakai, withmore than 30 years’ experience in cross-border transactions and corporate practice, including antitrust andcompetition law. She is especially experienced in international cartel investigations and is ranked as a leading
individual in relation to antitrust and competition law
in the Legal 500 Asia-Pacific 2015 and Chambers AsiaPacific 2015 publications. She is also ranked as ‘Highly
recommended’ in GCR 100 2015. After qualifying at
the Japan Federation of Bar Associations, she studied
at the Europa Instituut in the University of Amsterdam
and worked in a leading global law firm in Brussels
from 1986 to 1987. She serves as a board member ofthe EU Studies Association – Japan and is noted for her
comprehensive knowledge of EU competition law.

Atsushi Iritani is a partner at Atsumi & Sakai working
primarily in the field of antitrust and competition law,
tax law, corporate crisis management, compliance andother corporate legal affairs. He spent about 10 years asa public prosecutor engaging in criminal investigationin the field of economic crimes, including antitrust
cases and bribery cases. Since he joined Atsumi &Sakai, he has gained significant experience in the fieldof international cartel investigations and has provided
training in antitrust law compliance to many Japaneseand foreign companies. He is a graduate of Universityof Kyoto (BA, 1988) and admitted to the Bar in Japan.

Atsumi & Sakai
Fukoku Seimei Building
2-2-2, Uchisaiwaicho
Chiyoda-ku
Tokyo 100-0011
JapanTel: +81 3 5501 2111
Fax: +81 3 5501 2211
Setsuko Yufu
setsuko.yufu@aplaw.jp

Atsumi & Sakai was established in 1994 as a boutique firm focusing mainly on financelaw. Since then, the firm has developed and broadened its legal experiences in financeas well as a wide range of corporate and dispute resolution disciplines, including
antitrust and competition law, such as cartel investigations and merger controls.
It also advises on antitrust and competition law aspects of various transactions,
including licensing, franchise and distributorship arrangements. Recently, Atsumi &Sakai has become increasingly active in the field of international cartel investigations
and merger controls. Many of the firm’s junior lawyers have extensive international
experience in Asian, EU and American jurisdictions.

Atsushi Iritani
atsushi.iritani@aplaw.jp
Tatsuo Yamashimatatsuo.yamashima@aplaw.jp
Saori Hanada
saori.hanada@aplaw.jp
www.aplaw.jp

176

The Handbook of Competition Enforcement Agencies 2015

JAPAN

Tatsuo Yamashima
Atsumi & Sakai

Tatsuo Yamashima is a partner at Atsumi & Sakai
working primarily in the field of antitrust and competition law, government regulations, employment andhuman resources and other corporate legal affairs.
He has assisted and represented many Japanese andforeign companies with antitrust cases and merger
cases involving the JFTC, as well as authorities in many
foreign jurisdictions. In particular, he has significant
experience with leniency applications for the JFTC. Heis ranked as a leading individual (‘Up and Coming’) inrelation to antitrust and competition law in Chambers
Asia-Pacific 2015. He is a graduate of the University ofTokyo (BA, 2002; LLM, 2004) and is admitted to theBar in Japan. He worked in Brussels at the competition
law group of a leading global firm in 2011 as a visiting
foreign attorney.

www.globalcompetitionreview.com

Saori Hanada
Atsumi & Sakai

Saori Hanada is a partner at Atsumi & Sakai working in
the field of antitrust and competition law, employment
law and other corporate legal affairs. She has advised
major retailers on various unfair trade practice issues
and represented Japanese and foreign companies ininternational cartel cases and merger cases. She wasadmitted to the Japan Federation of Bar Associationsin 2000. She obtained an LLM from Columbia Law
School in 2010 and was admitted to the New York StateBar in 2012.

177