Japan's new law regulating tech giants' commerce platforms takes effect

Feb 02, 2021 | News On Japan

Feb 02, 2021 (Japan Times) - A new law to ensure that technology giants do business with small companies on fair terms came into force Monday.

The law for the transparency and fairness of digital platform services obligates tech giants to disclose terms of contracts with business partners and submit reports regularly to the government.

Online shopping website operators with annual domestic sales of ¥300 billion or more and app store operators with annual domestic sales of ¥200 billion or more are subject to the law. They are expected to include U.S. powerhouses Google LLC, Apple Inc. and Amazon.com Inc., as well as Japanese companies Rakuten Inc. and Yahoo Japan Corp., a unit of Z Holdings Corp.

The government plans to make its final decision on which companies are bound by the law in around spring to fully implement the new law’s rules.

The law is aimed at protecting small companies doing business with tech giants, which may use their strong bargaining power to impose unfair business terms on their smaller partners.

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