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Economy

Airbnb probed for antitrust violations in Japan

Agents allegedly prevented from listing on other websites

College students from Taiwan stay at an Airbnb home in Tokyo. The company said 5.85 million guests used its platform in Japan last year.

TOKYO -- Airbnb is under investigation in Japan for possibly breaching antitrust law, suspected of making agents for hosts promise not to use rival home-sharing platforms.

"What is this exclusivity clause?" thought a property manager in June after reading an Airbnb contract to the effect that agents posting and managing properties for owners could not use other websites. In exchange, they would gain access to availability and other vital data compiled by Airbnb.

"I reluctantly signed," the source admitted, saying that despite the consequences of not being able to list elsewhere, the managerial burden would become too great without the information.

Airbnb is Japan's top home-sharing website, with more than 50,000 rooms. It competes with around 10 other companies.

Owners can hire property managers to operate their properties as short-term rentals. These services take reservations, set prices and clean, among other tasks, taking a percentage of the revenue as a fee. Hundreds of such companies are believed to exist in Japan.

Airbnb entered the Japanese market in 2014 and helped popularize short-term rentals here.

The Fair Trade Commission suspects Airbnb of trading on exclusive terms by trying to unfairly reduce business opportunities of competitors. Airbnb denies the claim, saying it does not make avoiding other sites a condition of posting.

The Japanese market for short-term rentals is ballooning as inbound visitors increase. A Japan Tourism Agency survey of some 10,000 visitors from July to September found that 12.4% stayed in such accommodations. The reading falls well short of the 75.1% who used hotels but is closing in on the 18.2% staying at ryokan traditional inns.

Short-term rentals are currently barred outside strategic zones in Tokyo and Osaka but will be available nationwide starting next June when new legislation takes effect. Competition is heating up in anticipation of the lifting of the ban.

Companies that once feared such issues as complaints from neighbors are now stampeding to get in. Travel agency JTB has announced a partnership with website developer Hyakusen Renma to operate a home-sharing website. Rakuten has said it will enter the vacation rental business.

The Japanese market is seen amounting to 200 billion yen ($1.78 billion) by 2020, according to consultancy VSbias. "Companies are stepping up efforts to capture customers," a property manager said.

Industry insiders can all agree that the scramble for a slice of the growing pie is intensifying.

(Nikkei)

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