"An extract from The Handbook of Competition Enforcement Agencies 2014 www.GlobalCompetitionReview.com."

CHINA

THE HANDBOOK OF COMPETITIONENFORCEMENT AGENCIES

2014
A Global Competition Review special reportpublished in association with:
Atsumi & Sakai

GCR
GLOBAL COMPETITION REVIEW

www.globalcompetitionreview.com www.globalcompetitionreview.com

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JAPANOverview
Setsuko Yufu and Tatsuo Yamashima
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) isthe 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, 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 a formal administrative order (ceaseand desist and surcharge order) for 14 cartel cases in2013. In March 2013, a total of ¥13.3 billion in surcharges
were levied against NTN, NSK and NACHI in the bearing cartel case, and a total of ¥4.6 billion in surcharges
were levied against Koito and Ichiko in the automotive
headlamps and rear combination lamps cartel cases. The
amount of surcharges levied in cartel cases is calculated
as follows: the base rate (which is basically 10 per cent,but differs according to conditions, increased to 15 percent if any cartel 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 by the party finedfor the period of infringement, extending up to threeyears from the date such conduct ceased. Surcharges
imposed for cartel conduct, as well as abuse of superiorbargaining position (see below), totalled as much as ¥23billion in the 2012 fiscal year.
Regarding criminal investigations, the JFTC founda criminal violation of the AMA in the bearings cartel
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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, and acriminal trial is still ongoing in relation to one company and two individuals in March 2014. This trial isexpected to end at the end of July 2014. The JFTC also
opened its investigation on a criminal violation of theAMA in the Hokuriku-Shinkansen bid-rigging case in
September 2013. In March 2014, criminal accusations
were filed against eight equipment companies andeight individuals.
The JFTC has expressed its policy of continuing
strong and high-impact enforcements, as well asstrengthening cooperation with foreign authorities forthe purpose of deterring an infringement. The JFTC
has entered into bilateral cooperation agreements withthe competition authorities of the United States, theEuropean Union and Canada. Under these agreements,
various levels of information exchanges and discussions can be made between the participating authorities. The JFTC is entitled to exchange information withother authorities as well, based on the conditions set
out in the AMA.
Leniency

In the 2012 fiscal year, 102 leniency filings were made.
According to a JFTC press release, 10 out of 14 cartel
cases in which the JFTC issued a formal admin­istrative
order in 2012 were triggered by the first leniency applicant before the start of a JFTC investigation, and otheralleged companies followed in most cases.
Under the leniency programme in Japan, amaximum of five companies (or groups of companies)
will 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 after171

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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 thepercentage of reduction granted for cooperation.
Unfair trade practices

The JFTC imposed a ¥1.2 billion surcharge against
RALSE operating supermarket stores in North Japan
areas in July 2012 for abuse of its superior bargaining
position, the fourth case since the enforcement ofamendments to the AMA commenced in January 2010that subjected abusers of a superior bargaining position
to a surcharge. The base rate for calculating the amountof 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.
In Japan, it is not necessary for the JFTC to demon­
strate a restriction of competition in order to prove
the occurrence of an abuse of a superior bargaining
position in violation of the AMA. In contrast, privatemonopolisation – similar to an abuse of a dominantposition 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 2012fiscal year was 349. Of these notifications, three cases

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Setsuko Yufu
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were cleared subject to conditions under Phase IIreview while three cases were cleared without any conditions under Phase II review. In addition, the JFTC
cleared 340 cases with Phase II review and, amongthose, the 30-day waiting period, where the notified
transaction shall not be closed, was shortened in 127
cases, which represents a substantial increase from the36 cases in the 2011 fiscal year. There were no formal
prohibition decisions in 2013.
Mergers, business transfers, corporate splits (ordemergers), joint share transfers and share acquisitions(including joint ventures) are subject to prior notifi­
cation 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).
Proposed Reforms

In December 2013, the National Diet in Japan
approved a bill for the amendment of the AMA withthe aim of abolishing the current administrative hearing procedure in favour of a more detailed judicial
appeal procedure. This amendment has not yet but will
become effective on the day provided by the Cabinet
Ordinance no later than one-and-a-half years after thedate of such approval.

Atsumi & Sakai was established in 1994 as a boutique firm focusing mainly on
finance law. Since then, the firm has developed and broadened its legal experiences,
not only in finance but also in 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 ofvarious 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 haveextensive international experience in Asian, EU and American jurisdictions.

Tatsuo Yamashimatatsuo.yamashima@aplaw.jp
www.aplaw.jp

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The Handbook of Competition Enforcement Agencies 2014

JAPAN

Setsuko Yufu
Atsumi & Sakai

Tatsuo Yamashima
Atsumi & Sakai

Setsuko Yufu is a senior partner at Atsumi & Sakai,
having developed for more than 30 years her extensive
experience in cross-border transactions and corporate
practice, including antitrust and competition 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 2013 and Chambers Asia-Pacific 2013
publications. After qualifying at the Japan Federation ofBar Associations, she studied at the Europa Instituut inthe University of Amsterdam and worked in a leading
global law firm in Brussels in 1986–1987. She serves asa board member of the EU Studies Association – Japanand is noted for her comprehensive knowledge of EU
competition law.

Tatsuo Yamashima is a partner at Atsumi & Sakai
working primarily in the field of antitrust and compe­
tition 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. He
is a graduate of the University of Tokyo (BA, 2002; LLM,2004) and is admitted to the bar in Japan. He workedin Brussels at the competition law group of a leading
global firm in 2011 as a visiting foreign attorney.

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