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Economy

Japan's antitrust body to set rules for data-sharing tie-ups

Watchdog aims to keep partners like Toyota and SoftBank from monopolizing information

Japanese antitrust officials will formulate rules for how cross-industry alliances can share data.   © Reuters

TOKYO -- Japan's antitrust watchdog will craft rules for cross-sector partnerships in high-tech fields like automated driving and connected devices, seeking to prevent monopolies on big data and intellectual property.

In planning conferences starting in December, the Fair Trade Commission's Competition Policy Research Center aims to clarify at what point inter-industry data sharing crosses the line into illegality. It aims to reach a conclusion as soon as the summer, with the FTC expected to use the rules as the basis for new guidelines on antitrust law.

The move comes as companies increasingly reach across industry lines to tackle new business models, such as in Toyota Motor and SoftBank Group's partnership on next-generation cars. Mitsubishi Electric, industrial robot maker Fanuc, machine tool maker DMG Mori and Hitachi have also agreed to share data through a platform of connected devices, collectively referred to as the "internet of things."

The tie-ups are not expected to increase the companies' market share in relevant products, like cars and smartphones in the case of Toyota and SoftBank. But such partnerships can create monopolies on customer data, an indispensable asset for certain businesses, as well as on patents. Companies left out could be put at a competitive disadvantage.

Having a clear set of rules is expected to prevent reorganizations by Japanese businesses from being hobbled, at a time when U.S. information technology giants like Google and Amazon.com are enlarging themselves even further through cross-sector partnerships.

Japan's Anti-Monopoly Act focuses on stopping companies from gaining a dominant grip on markets, resulting in high prices and lower quality of service. The FTC scrutinizes mergers and acquisitions to make sure the deals will not impede market competition, and issues concrete guidelines to help companies follow the law. Rules on business tie-ups can be difficult to understand, as different ones apply depending on the specific content of the deal or whether a capital relationship is involved.

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