Japan’s Ministry of Economy, Trade and Industry (METI) has announced that it will seek to allow the Japan Fair Trade Commission (JFTC) to regulate foreign companies’ violations of Japan’s Antimonopoly Act by actively pursuing extraterritorial application of the law. METI has stated that it will convene a study group consisting of academic experts, industry representatives and lawyers, among others, to evaluate expanding the law and conforming it to US and EU models. The JFTC will participate in the study group as an observer, and will weigh alternatives to the group’s final proposal. Such proposal is expected to be published by April 2008.
METI’s action comes as a result of mounting dissatisfaction in Japan with the EU’s strengthened enforcement of cartels and the increased frequency of cases both in the EU and US imposing large surcharges on Japan-based companies. Businesses in Japan are calling for the JFTC to take a similar hardline approach towards foreign companies that harm Japan’s consumers and markets through anticompetitive conduct abroad. Specifically, METI is seeking to extend application of the Antimonopoly Act to anticompetitive conduct abroad which raises prices charged to Japan’s consumers or where Japan-based companies are placed in competitively disadvantageous positions due to cartels or anticompetitive mergers and acquisitions.