Japan's Fair Trade Commission has issued a recommendation for major cardboard manufacturer Nippon Tokan Package to pay for services and prevent recurrence after it was found to have illegally required subcontractors to store over 7,800 items free of charge.
The Japan Fair Trade Commission (JFTC) recommended major cardboard manufacturer Nippon Tokan Package, based in Shinagawa, Tokyo, to pay costs associated with a violation of the Subcontract Act. The recommendation came after the company was found to have unlawfully requested subcontracted businesses to store more than 7,800 items, including resin-based printing plates and wooden molds, at no charge. This breach of the law pertains to the improper solicitation of economic benefits under the current Small and Medium-Sized Enterprise Contract Properization Act.
Specifically, the JFTC reported that Nippon Tokan had about 132 subcontractors who were employed for cardboard manufacturing. Since at least April 2024, these subcontractors have been asked to store a total of 6,538 printing plates used for printing text on cardboard and 1,308 wooden molds used for creating creases. None of these subcontractors had received orders for more than a year, yet they were still required to maintain these items without any form of remuneration.
This practice of storing items without payment is not uncommon within manufacturing sectors in Japan, and it highlights ongoing concerns about fair business practices involving subcontractors. The investigation was initiated following a request for action made by the Small and Medium-Sized Enterprise Agency, which pointed to this issue as detrimental to small businesses within the industry.
