Google to Face Antitrust Action in Japan
The Fair Trade Commission (FTC) of Japan is expected to take its first administrative action against Google LLC based on the Anti-Monopoly Law. The FTC suspects that Google impeded the search advertising business of its rival, Yahoo Japan Corp.
The investigation began in 2022 after concerns arose that Google's contract with Yahoo Japan restricted the latter's search advertising business for smartphone sites. This restriction is believed to be in violation of the Anti-Monopoly Law.
In response to the investigation, Google submitted a plan to the FTC this month. This plan outlines voluntary measures to halt the alleged antitrust practice and prevent its recurrence.
The FTC is expected to soon announce the plan after certifying it as workable under its "commitment procedure." This procedure allows the antitrust watchdog to promptly address suspected anti-competitive practices.
Google has fully cooperated with the FTC's investigation and is awaiting the commission's approval of its corrective plan.
The domestic market for keyword-targeted search advertising is estimated to be worth 1.07 trillion yen ($6.93 billion) as of 2023. Google dominates the market with a 70-80% share, while Yahoo holds the remaining portion.
Since 2010, Yahoo has been using Google's advertisement delivery technology for its search advertisement business for websites other than its own.
In the mid-2010s, Google demanded that Yahoo stop delivering advertisements for smartphone sites. Yahoo, reliant on Google's technology, complied with this demand.
Following the FTC's investigation, Google retracted its demand against Yahoo in 2022.
If the FTC approves the commitment plan submitted by Google, the commission will end its investigation without recognizing the company's behavior as a violation of the Anti-Monopoly Law. Google will be obligated to fulfill the measures laid out in its plan.
The FTC will not issue a cease-and-desist order or a surcharge payment order, which are normally imposed as punishment for antitrust practices.