Japan Press Weekly

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2021 December 8 - 14 [SOCIAL ISSUES]

United efforts of shop owners with JCP put brakes on Rakuten’s monopolistic control

The Japan Fair Trade Commission recently released its investigation results which concludes that major internet shopping service company Rakuten’s act of forcing shop owners to shoulder shipping costs under its free shipping service policy amounts to an abuse of its dominant bargaining position and is thus an obvious breach of the Antimonopoly Law.

In reaction to the JFTC’s announcement, Rakuten promised to respect shop owners’ demands and to not conduct any act prohibited under the law. This outcome was achieved through shop owners’ efforts in collaboration with the Japanese Communist Party and Akahata.

Rakuten in August 2019 planned to introduce a free shipping service program in its online shopping mall named “Rakuten Ichiba”. Under the plan, all orders over a certain price level will be shipped for free and shipping charges will be imposed on merchants on Rakuten Ichiba. This plan elicited a fierce criticism and complaints from many small shop owners.

These small shop owners in October 2019 formed a Rakuten Union and asked parliamentarians for help. In response, JCP member of the House of Councilors Iwabuchi Tomo launched an investigation into the matter and Akahata frequently reported on this issue, which encouraged the JFTC’s probe, leading to the improvement of the situation.

Iwabuchi in November 2019 at a meeting of the Upper House Economy and Trade Committee urged the JFTC head to instruct Rakuten not to implement its free shipping scheme. The JFTC head in his reply promised to question the company on this matter.

At an Upper House Committee meeting in March 2020, the JCP lawmaker reported that Rakuten forced shop owners to accept the free shipping scheme in a threatening manner such as threatening to not renew their contracts, and again demanded that the JFTC order Rakuten to abandon the scheme. Other JCP lawmakers at Diet meetings in both chambers made a similar request.

Rakuten Union leader Katsumata Yuki expressed his hope for Iwabuchi’s further work, and said, “We took a big step forward with the formation of our union. We’ll continue fighting against other unfair rules forced upon us by Rakuten.”

JCP Iwabuchi pointed out that Rakuten’s free shipping policy was revised because the union and other shop owners raised their voices of dissent. However, she went on to point out that the company still uses unfair business practices against shop owners. Appealing for the need to establish fair and transparent rules for domestic and foreign online sales, Iwabuchi expressed her determination to work hard to achieve this.

Past related article:
> Shop owners form union to resist control by major platformer Rakuten [December 24, 2019]