In recent years, digital technology-based trading has dramatically been improving users’ access to markets, and digital platforms, in particular, have been playing a significant role in such trading. Meanwhile, some concerns have been raised over digital platform markets, such as transparency and fairness.
Against this backdrop, the Ministry of Economy, Trade and Industry (METI) has been advancing development of rules for markets surrounding digital platforms, the building of a framework for helping stakeholders share challenges that they are facing, and conducting comprehensive surveys for digital markets that are changing dramatically.
Act on Improving Transparency and Fairness of Digital Platforms (TFDPA)
Aiming to improve the transparency and fairness of digital platforms, the Act on Improving Transparency and Fairness of Digital Platforms (TFDPA) was established on May 27, 2020, promulgated on June 3, 2020, and enforced on February 1, 2021.
The Act stipulates necessary measures for digital platforms, including requirements of digital platform providers to disclose terms and conditions and other information, secure fairness in operating digital platforms, submit a yearly report on the current situation of business operation, and conduct self-assessments. The Act also requires the METI Minister to review the business operation of the platform based on the yearly report and other information with involvement of business users, consumers and academics, and to publish the results of the assessment.
In addition, the Act requires the government to encourage digital platform providers and their customers to facilitate mutual understanding on the basis of such digital platform providers making voluntary and proactive efforts with minimally necessary commitments by the government.
For details of the Act, visit the following website:
The Act designates digital platform providers whose transparency and fairness must be significantly improved in particular among other digital platforms as “specified digital platform providers” and it makes such providers subject to specific regulations.
The Act requires the specified digital platform providers to disclose terms and conditions and other information, develop procedures and systems to ensure their fairness in a voluntary manner and to submit a report every fiscal year on the overview of measures that they have conducted to which self-assessment results are attached.
Cabinet Order: Cabinet Order for Stipulating the Business Category and Scale under Article 4, Paragraph 1 of the Act (in Japanese)
This Cabinet Order stipulates the provisions based on the category and scale of the business in order to designate specified digital platform providers.
This Ordinance stipulates requirements that specified digital platform providers must meet, including methods for disclosing terms and conditions and other information to their customers, items that such providers are required to disclose in addition to the provisions under the Act, grounds for exceptions of notifications of reasons in requirements of information disclosure to their customers, and items that must be included in the annual report and formats for those items.
Guidelines: Guidelines for Measures Taken by Specified Digital Platform Providers to Facilitate Mutual Understanding with Platform Users (in Japanese)
The Guidelines stipulate 1) direction of desirable measures and 2) examples of specific reference measures that specified digital platform providers should take to facilitate mutual understanding with their customers. The Guidelines are to be taken into consideration in monitoring reviews by government.
- Development of systems and procedures for securing fairness;
- Development of systems and procedures for settling and resolving complaints and disputes;
- Appointment of administrators to manage communication within Japan (administrators in Japan); and
- Other measures necessary for taking into consideration customer situations.
Procedures that digital platform providers are required to take
Digital platform providers must make use of a gBizID to complete the procedures regarding submission of a notification under the provisions of Article 4, Paragraph 2 of the Act.
Digital platform providers subject to specific regulations
METI designated the following digital platform providers as “specified digital platform providers”subject to specific regulations under the Act.
1. Digital platform providers of comprehensive online shopping malls selling goods
|Designated digital platform providers||Reference: Comprehensive online shopping malls selling goods provided by the relevant provider|
|Amazon Japan G.K.||Amazon.co.jp|
|Rakuten Group, Inc.||Rakuten Ichiba|
|Yahoo Japan Corporation||Yahoo! Shopping|
2. Digital platform providers of application stores
|Designated digital platform providers||Reference: Application stores provided by the relevant provider|
|Apple Inc. and iTunes KK||App Store|
|Google LLC||Google Play Store|
Press releases on the Act on Improving Transparency and Fairness of Digital Platforms (latest information)
- Designation of Digital Platform Providers Subject to Specific Regulations Under the Act on Improving Transparency and Fairness of Digital Platforms (April 1, 2021)
- Cabinet Decisions Made on Two Cabinet Orders for the Act on Improving Transparency and Fairness of Digital Platforms (January 26, 2021)
- Cabinet Decision on the Bill for the Act on Improving Transparency and Fairness of Digital Platforms (February 18, 2020)
Latest Policy Updates on Digital Platforms in Japan
Division in Charge
Digital Market Policy Office, Information Economy Division, Commerce and Information Policy Bureau