A government panel of experts considering how to regulate major digital platform operators held a hearing on Wednesday in which U.S. digital giants gave their opinions on the panel’s interim report, which calls for stronger regulations.
The panel, chaired by Kobe University Prof. Fumio Sensui, is scheduled to finalize the report within the year.
The digital giants’ opinions on the tightening of regulations will be included in the final report.
Initially, the panel intended to hold an open session to hear from the companies.
However, it decided on a closed session instead in response to requests from the companies scheduled to attend the hearing.
According to a source close to the panel, of the four U.S.-based companies collectively known as GAFA (Google, Apple, Facebook and Amazon.com), only Google and Apple attended the hearing. Officials of the companies reportedly flew in from their U.S. headquarters.
Facebook and Amazon were apparently absent from the hearing.
At the hearing, the panel of experts reportedly inquired into whether the companies disclose information such as the terms and conditions of contracts made with individuals and other corporations, and how personal information is currently gathered and used, among other matters.
The panel held an open meeting following the hearing.
There, one of the experts said that although the platformers — as the digital platform operators are called in Japanese — contend they base their business conduct on democratic rules, “It is a serious problem that we have a situation in which there is no way to verify that.”
Discussions were also held on how to define fair and free competition.
Tighter rules called for
The panel released the interim report on Nov. 5. It pointed out that management of the platforms, including search engines, online shopping sites and social media sites, “by its nature manipulates [information and transactions] and is extremely obscure.”
It calls for stronger regulations including establishing a team of specialists for monitoring and obligating the companies to disclose the terms and conditions of their business deals, with the aim making of contracts more transparent.
The tighter regulations are aimed at the four GAFA companies.
Based on the report, the Fair Trade Commission will embark on large-scale investigations on a voluntary basis as early as early next year to examine the actual state of business deals conducted by the companies.
It is even considering launching compulsory investigations based on Article 40 of the Antimonopoly Law.
To back up the commission’s investigations, the government plans to establish the team of specialists recommended by the panel as early as next year to analyze complicated contract terms and report back to the FTC if it finds illegal business transactions.
The panel was set up in July this year by the Economy, Trade and Industry Ministry, the FTC and the Internal Affairs and Communications Ministry. Speech