Foreign Firm Access to Japanese Distribution Systems: Trends in Japanese Antitrust Enforcement

The Japanese substantive competition law is, in theory, very well equipped to prevent anticompetitive behavior that restricts competition. In reality, the JFTC has been weak in enforcing the law. The JFTC has been particularly weak in two areas, boycotts and non-price vertical restraints, making market entry difficult for foreign firms. In response to criticisms of weakness, the JFTC released the 1991 Guideline that states that boycotts may constitute an unreasonable restraint of trade and be subject to administrative surcharges and possible criminal sanctions. Despite the strengthening of the law against boycotts, no cases have been brought. Furthermore, the JFTC has yet to make public the critical factors necessary to determine, a finding of non-price vertical restraints. The author asserts that the JFTC will have to bring increasing enforcement in these two areas to create greater ease of foreign market entry