and ideal transition from the fixed-line telephone network will exert significant influence on users and carriers.

In order to deliberate this issue under such understanding, MIC consulted with the Information and Communications Council regarding the ideal smooth transition of the fixed-line telephone network in February 2016, and the first report “Ideal IP Network after the Transition” was compiled in March 2017.

## (5) Market Verifications in the Telecommunications Business Field

Under the framework of the Telecommunications Business Act, which basically focuses on after-the-fact regulations, it is required to promote fair competition and ensure user convenience in the telecommunications business field, which has been facing rapid changes such as a structural change in the telecommunication market due to fast advancement of ICT and emergence of new business models. For that purpose, it has become important to accurately ascertain and properly analyze and verify market trends and reflect the results thereof in carrying out policies.

In view of these necessities, MIC has enhanced and expanded the assessment of competitions in the telecommunications business field and the fair competition review system for facilitating the dissemination of broadband communications. MIC has also been carrying out market verifications since FY2016 to integrally conduct analyses and verifications of market trends and confirmations of the correctness of carriers' business practices.

## (6) Mediation and Arbitration by the Telecommunications Dispute Settlement Commission

### A. Overview of the Telecommunications Dispute Settlement Commission

The Telecommunications Dispute Settlement Commission is a specialized organization established for the purpose of quickly and fairly handling increasingly diverse conflicts in the telecom field. The Commission has three functions: (i) performing mediation and arbitration to resolve conflicts between carriers and other businesses; (ii) deliberating and releasing reports in response to consultations from the Minister for Internal Affairs and Communications, who intends to issue an order or ruling; and (3) giving recommendations to the Minister for Internal Affairs and Communications regarding improvements to competition rules or other matters as part of its mediation, arbitration, and consultation responses.

### B. Negotiation Orders and Rulings by the Minister for Internal Affairs and Communications

In the telecom field, when negotiations between telecom businesses fall apart on matters such as interconnection or shared use of telecommunications equipment, shared use of structures for telecommunications equipment and installations, or the provision of wholesale telecommunications services, a telecom business may apply to the Minister for Internal Affairs and Communications to issue an order to start or resume negotiations or to make a ruling on the matter based on the provisions of the Telecommunications Business Act.

### 2. Ensuring Safety and Reliability of Telecommunications Infrastructure

MIC enacted the ICT Network Safety and Reliability Standards to ensure stable provision of communications and to prevent misuse of communications. The standards provide basic, but comprehensive, indicators spanning all security and reliability aspects of ICT networks, such as necessary hardware and software functionality and system maintenance and operation methods.

### 3. Proper Handling of Personal and User Information in Telecommunications Services

Smartphones store many forms of user information, and apps collect and use such information. In some cases, apps provide collected information to third parties, but users have concerns and anxieties because of the difficulty in finding out what information is being collected and used. MIC investigated issues surrounding the widespread use of privacy policies and the promotion of a system for third parties to verify operational and technology aspects of apps. From FY2014 to FY2015, MIC carried out tests prior to constructing a third-party verification system.

## Section 3 Developments in Radio Policy

### 1. Promoting Effective Radio Spectrum Use

## (1) Studies on How to Encourage Effective Radio Spectrum Use

In January 2016, MIC set up the Radio Policy 2020 Panel for the purpose of investigating approaches to the radio usage fee system, which is due to be revised in FY2017, and deliberating policies to advance Japan's wireless services and boost their international competitiveness leading up to 2020, as well as directions for system revisions that will allow for the introduction of new wireless systems. The Panel compiled a report in July 2016.