CPI Asia Column edited by Vanessa Yanhua Zhang (Global Economics Group) present:
KANSEI-DANGO and Antimonopoly Law in Japan – The Characteristics of Collusion in the Japan’s Public Procurement –By Shuya Hayashi (Nagoya University Graduate School of Law)
Introduction
To promote free and fair competition, public tendering system is a measure generally used by national, local, and regional government bodies as well as public organizations in Japan. Bid-rigging (a voluntary restriction of competition by prearranged activities among bidders) erodes the integrity of the entire bidding system and violates the Japanese Anti-Monopoly Act (hereinafter AMA).1
National and local government officials have sometimes been found to be involved as participants in bid-rigging.2 For example, a government official in charge of the bidding process may call a meeting with representatives from the business sector in order to provide yearly targets of order volume allocated to each enterprise. This officer may instruct business entities to coordinate in achieving such targets. In addition, in response to requests from businesses entrepreneurs, the official may designate the winner of the bid by suggesting a prospective name or even leaking the planned ceiling price, which is confidential and could not be disclosed. In Japan, bid-rigging is generally called kansei-dango (government-assisted or -facilitated bid-rigging). Other seminal cases of kansei-dango in Japan include disclosur
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