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Amazon faces anti-competition probe in Japan

15 March 2018

Amazon Japan, the Japanese arm of the US online retailer, said its offices have been raided by the country's fair trade regulator, Japan Fair Trade Commission (JFTC), on suspicion of anti-trust violations.

According to reports, it is facing specific allegations of asking vendors for a percentage of their sales revenue, to  shoulder costs incurred for selling their products at a discount.  

Nikkei Asia reported, citing sources, the Japanese company began asking its vendors contribute "cooperation payments" ranging from a few percentages upto 10 percent, from around 2017, claiming that the contributions would be used for system upgrades and other improvements.

It  is also alleged to have asked vendors help absorb the costs of discounting goods, in a bid to help offset rising shipping and other operational costs.

The JFTC conducted an on-site investigation at Amazon Japan's office on Thursday on on  suspicions the company was using its dominant position in the country's e-commerce market to pressure suppliers, making it virtually impossible for them to refuse the request, the Nikkei report added.

According to a Reuters report, Amazon Japan is cooperating in the investiagations.

JFTC will clarify the details of the payment procedures.

This is not the first time Amazon Japan has been investigated over anti-trust breaches; in 2016, JTFC raidedis offices on suspicions it had coerced retailers to set prices on Amazon Japan as low or lower than prices for those products listed on other e-commerce sites.

The investigation was called off in June last year after Amazon Japan agreed to stop the practice.

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