More fresh suspicions have emerged surrounding the 2020 Tokyo Olympic and Paralympic Games. The murky issue of vested business interests relating to the global event, ostensibly known as a "festival of peace," is looking almost bottomless. Investigators must get to the heart of the string of scandals.
The Tokyo District Public Prosecutors Office's special investigation unit, collaborating with the Japan Fair Trade Commission, raided the head offices of Japanese advertising giant Dentsu Inc. and event organizer Cerespo Co. over allegations that these companies rigged bids for the Tokyo Games' test events in violation of the Antimonopoly Act.
The latest allegations come on the heels of a widening bribery scandal in which 15 figures including a former executive of the Tokyo Organising Committee of the Olympic and Paralympic Games and top officials of major corporations have already been indicted over Games sponsorship selections and other processes.
The test events were held to identify operational problems ahead of the real events, and the organizing committee contracted these and other companies to draw up plans.
A total of 26 bids were tendered for the mock events at various venues. Nine firms including Dentsu and Cerespo, as well as a consortium of businesses, were awarded the contracts. The companies are suspected to have placed bids for the project after arranging bidders who could win the contracts. Such bid rigging undermines the fair bidding process and inhibits competition, causing project costs to rise to an unreasonably high level.
The amount of the contracts totaled more than 500 million yen (approx. $3.6 million). Most of the companies that won the contracts also undertook operational management of the real events at the same venues under discretionary contracts. The total amount of the latter contracts reached around 1.5 billion yen ($108 million).
What cannot be overlooked are suspicions that the organizing committee itself was also involved in the bid rigging. The Tokyo prosecutors' special investigation team has also searched the home of a former senior committee official who was in charge of these test events.
The committee's division overseeing the test events reportedly asked companies about venues they preferred, and even created allocation charts. Employees of companies that snared the contracts had temporarily been assigned to this very division.
Given these reports, it appears the organizing committee and the companies colluded in their respective roles as outsourcer and contractors. Furthermore, the alleged misconduct took place despite the law's stipulation that committee executives and employees are considered public servants and have a public responsibility. The organizing committee's lack of checking systems came to light over the course of investigations into the bribery scandal. And now the latest suspicions have brought the dysfunction of the now-defunct committee's governance into sharp relief.
The Tokyo Metropolitan Government, responsible for setting up the organizing committee, has formed an investigation team to look into the suspected bid rigging. The Japanese Olympic Committee also needs to fulfill its accountability.
Colossal amounts of public money were injected into the Tokyo Games by the national and metropolitan governments. It is imperative to verify the role of the Tokyo 2020 committee as the main organizer of the extravagant event.