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The Japanese competition (antitrust) law is the Act on Prohibition of Private Monopolisation and Maintenance of Fair Trade, which is generally abbreviated as the “anti-monopoly act” (AMA) in English. However, the anti-monopoly aspect has hardly been enforced, and the name of the act does not match its enforcement. The AMA was enacted in 1947, and the Japan Fair Trade Commission (JFTC) has since accumulated enforcement experience, including in relation to foreign affiliated companies.

The JFTC has maintained a relatively low profile due to comparatively modest administrative fines (surcharges) compared to those in the US and Europe, coupled with the lack of active civil litigation, despite being a longstanding competition authority. However, a series of significant cases emerged between 2024 and the first half of 2025, indicating the JFTC’s strong determination to enforce the law.

Regulatory types

The AMA comprises the following main categories of regulatory types.

1. 1. “Unreasonable restraint of trade”, which prohibits horizontal restrictions, including bid-rigging and hardcore cartels. Violations are subject to:
      a. criminal penalties for individuals and corporations (imprisonment and criminal fines);
      b. a cease-and-desist order; and/or
      c. an administrative monetary penalty (surcharges payment order) calculated at 10% of sales proceeds. Violations are also subject to civil litigation by victims.
   2. Business combination regulation (or merger filing), which requires that a written notification be filed with the JFTC in advance of any stock acquisition, merger, corporate split-up or business transfer exceeding a certain size. Closing cannot take place until the maximum 30-day waiting period is completed. If the commission does not complete its examination within 30 days, it may initiate a second 90-day examination.
      However, in complex cases 30 days is not sufficient, so it is common practice to consult with the JFTC in advance before starting the primary examination. In practice, the second 90-day examination is rarely conducted, and detailed discussions with the commission, including proposals for remedy, are mostly conducted within the primary examination.
   3. “Private monopolisation” and “unfair trade practices” (excluding abuse of superior bargaining position), which govern vertical trading restrictions. Note that only private monopolisation is subject to criminal penalties and administrative monetary penalties, but the legal requirements of private monopolisation and unfair trade practices overlap for the most part. They regulate exclusion of others, control of the distribution process and predatory pricing. They are also subject to civil litigation by victims.
   4. “Abuse of superior bargaining position” regulation is a unique type of unfair trade practice. It restricts the exploitation of vertical counterparties and aims to protect the weaker company. This clause does not apply only to companies with a high market share (e.g. dominant position) but also to companies that have a relatively superior position to the other counterparty. The Subcontract Act and the Freelance Protection Act also support the enforcement of abuse of a superior bargaining position.

Characteristics of enforcement

Compared to antitrust theory in the US or the EU, which has developed through the accumulation of court precedents, the precedents in Japan are still not enough to determine the interpretation of the anti-monopoly act. Therefore, the criteria for application of the AMA have not been well discussed.

For example, the “per se illegal” category does not exist in Japan. The act developed as an administrative law enforced by the JFTC, and the various guidelines of the commission are extremely important to understand the enforcement of the AMA. Civil litigation is not active in Japan due to the lack of treble damages, class actions and presumption of damages provisions.

Although there are criminal penalties for individuals and corporations for unreasonable trade restrictions, there were only about 30 cases in the AMA’s history. In recent years, a leniency system similar to amnesty in the US and leniency in the EU was introduced, which exempts from all fines and criminal penalties those who first voluntarily report illegal activities to the JFTC, and seems to work well so far.

One feature of the Japanese leniency system is that even those who voluntarily report to the commission, and who are not the first whistleblower, are also entitled to a certain amount of surcharge reduction, depending on their level of co-operation with the JFTC.

There are no specific gun-jumping regulations in Japan for merger filing, but it could be an unreasonable restraint of trade or a violation of the waiting period. Since a business combination with a high market share cannot be examined in the waiting period of 30 days, it is customary to initiate prior consultation with the JFTC before formal notification. JFTC officials are flexible, and the company should take a proactive approach to merger filing.

Abuse of superior bargaining position is a system that does not exist in the US and has developed differently in Japan, from article 102 of the Treaty on the Functioning of the EU. The JFTC has stopped formally issuing an order on abuse of superior bargaining position since the 2010s.

Instead, it enters into a type of settlement called a “commitment procedure”, in which companies voluntarily resolve the problem and the JFCT does not recognise illegal activities. The commission also recently published the names of companies on the grounds that they may have engaged in illegal activities.

Attorney-client privilege is partially granted, but not fully. The JFTC does not give the right to remain silent and does not allow attorneys to attend during interviews. Although what an attorney can do during a dawn raid is limited, the key point is the effective negotiation through the attorneys with the JFTC about the scope of the investigation.

Key developments

For the crackdown on cartels, a major case came to light in October 2024, involving four leading non-life insurance companies, which were ordered to pay surcharges totalling about JPY2 billion (USD13.8 million). Leniency was also used in this case.

In May 2025, hotel operators received a warning for exchanging information such as average room rates. This underscores the continued need for vigilance regarding information exchanges among competitors in Japan. The hotels were fortunate that the matter was resolved without any lawsuits being filed, or cease-and-desist orders or penalties being issued.

The JFTC had been putting increasing pressure on Big Tech. Previously, it had used settlement procedures and warnings, but in April 2025, it finally issued Google with a formal exclusion order.

In the area of bundled sales, a formal legal order was issued in July 2024, the first formal legal order in bundled sales in a quarter of a century. The case involved medical devices, and in February 2025 the commitment procedure between the JFTC and another medical device manufacturer concerning bundled sales was concluded.

With respect to resale price maintenance, the JFTC issued warnings in August 2024, followed by a cease-and-desist order in December, and another warning in March 2025, demonstrating its strong concern over such practices.

The merger between two drugstore chains has sparked significant discussion in merger reviews due to the inclusion of a remedy requiring the sale of 10 stores. Such remedies for retail stores have not been imposed for more than a decade, and they were previously considered unnecessary in highly competitive industries like drugstores.

However, multiple lawyers and economists have testified that the JFTC’s review process has clearly become stricter since 2025, requiring detailed counterarguments based on economic analysis.

Of the major merger cases announced by the JFTC in June 2025, three out of 10 included remedial measures. Of these, the acquisition of Nippon Cargo by ANA involved a detailed analysis. For the remedy proposed by ANA, a certain amount of cargo space would be provided to a third party. To ensure proper implementation, a law firm and a prominent economist were appointed as independent monitors, marking the first case of its kind.

Through recent legislative and guideline developments, the JFTC is strengthening its stance on protecting the vulnerable by using competition law. One example of this is the revision of the Subcontract Act, which expands the scope to include companies with substantial operations but small capital, as well as transportation contracts between shippers and transportation companies that were previously excluded.

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