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Japan Cabinet OKs bill to level playing field for small ecommerce vendors

Logos of Rakuten, Apple, Google, Amazon and Yahoo. (Kyodo)

TOKYO (Kyodo) -- Japan's Cabinet approved Tuesday a bill that aims to improve contract transparency to prevent large technology firms from using undue leverage over small vendors that operate on their platforms.

    The bill calls on operators of massive online shopping sites and app stores, including Inc., Google LLC and Apple Inc., to report once a year to the government on their internal processes and systems.

    The content of their reports will be evaluated and disclosed by the Ministry of Economy, Trade and Industry.

    The government is aiming to pass the bill during the ongoing parliamentary session and enforce it by March next year.

    Concerns have been growing that major tech firms are abusing their dominant positions to take advantage of smaller companies that do business on their platforms, often unilaterally changing terms and conditions and raising fees without warning.

    Under the bill, the large companies will be asked to notify vendors of changes to contract terms in advance, disclose how they set rules on displaying search results, and give them a mechanism to make complaints.

    Prime Minister Shinzo Abe's government specified in its growth strategy last year that it would consider regulating the large firms, which it had discussed with relevant ministers and experts at meetings on digital market competitiveness.

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