The Fair Trade Commission in Japan found itself in a situation where Google had seemingly deceived the authorities by altering a business tie-up agreement with Yahoo Japan. Initially approved by the FTC, the agreement allowed Yahoo to use Google's advertisement delivery technology without constraints. However, Google later demanded Yahoo to cease using its technology for delivering search advertisements to smartphone sites other than its own, effectively restricting Yahoo's operations.
This move by Google changed the power dynamics between the two companies, with Yahoo complying and becoming unable to deliver such advertisements using Google's technology. Despite regular communication between the FTC and the companies, the altered terms of the agreement were not disclosed to the authorities, leading to a sense of betrayal and prompting the FTC to initiate an investigation in 2022. This investigation marked the first administrative action by the Fair Trade Commission against Google under the Anti-Monopoly Law.
The situation highlighted concerns within the FTC about failing to fully grasp the changing landscape of the digital market. The FTC approved the business tie-up without foreseeing the impact of Google's actions on competition, raising questions about oversight and regulatory processes. Following the FTC's administrative action, Google pledged to adhere to the corrective action plan, while Yahoo refrained from commenting on the issue, signaling the complexities and challenges in regulating tech giants in the digital economy.