Amendments to the Antimonopoly Act passed by the Japanese Diet last summer became effective on January 1, 2010. The main amendments include a revision of the surcharge system and a revision of the regulation concerning mergers and acquisitions.
One of the revisions of the surcharge system is to expand the types of conduct subject to fines from cartels to exclusionary private monopolies, concerted refusals to trade, discriminatory pricing, sales at unfairly low prices, resale price restrictions and abuses of dominant position. The purpose in expanding the types of conduct subject to fines was to better protect the interests of medium and small enterprises.
To ensure the transparency of Japan Fair Trade Commission’s (JFTC) enforcement of the revised Antimonopoly Act, the JFTC published guidelines (pursuant to public comments received) on October 28, 2009, that set forth its enforcement policies for investigation and the essential elements of exclusionary conduct. The Guidelines state that the JFTC’s intent is to review matters on a priority basis – prioritizing cases involving companies with market shares of more than 50 percent. The 50-percent standard was disclosed for the first time in the Guidelines.
The revisions introduced a system of pre-notification (with a waiting period) instead of post-notification for mergers and acquisitions. As a general rule, shares may not be acquired until the expiration of a 30-day waiting period. In addition, the revisions reduce the number of percentage thresholds from three (10, 25 and 50-percent interests) to two (20 and 50-percent interests). The Amendments also introduce domestic turnover thresholds to replace the current asset-based thresholds.