Japan: Asia Pacific Competition Highlights, Q1 2021

This update was published on 13 April 2021, as part of our quarterly newsletter, Asia Pacific Competition Highlights. Click here to access the full report, which covers the most notable antitrust developments across 10 Asia Pacific jurisdictions.

New law affecting digital markets in Japan now in effect

A new law that would require greater transparency in transactions involving digital platform operators came into force on 1 February 2021.

The Japanese Government has been considering digital market regulation since 2018. The Act on Improvement of Transparency and Fairness in Trading on Specified Digital Platforms came into force on 1 February 2021.

A limited number of digital platform operators called ‘Specified DPF Providers’ are subjected to the legislation due to the heightened necessity of ensuring that these platforms operate with transparency and fairness. Only large-scale online mall (where domestic sales in Japan of the operator and its users exceed 300 billion yen) and app stores (where domestic sales in Japan of the operator and its users exceed 200 billion yen) have been initially defined as Specified DPF Providers under the relevant rules. Digital platform operators that meet the thresholds submitted notifications, and the relevant authority has designated five overseas/domestic platform operators as Specified DPF Providers based on the notifications.

Specified DPF Providers will be required to:

• disclose the terms and conditions of their contracts with users;
• take other measures, including the establishment of procedures and administrative organs to ensure the fairness of transactions and dispute settlement procedures; and
• submit annual reports and self-assessments to the Ministry on the status of their implementation of the above measures.

For more information, please refer to our client alerts (see here and here).