Reiwa 7 (Wa) 154 Public Contract Bid-Rigging Obstruction Case

In 2025, the Tokyo District Public Prosecutors Office's Special Investigation Unit indicted several senior executives from major general contractors, including Obayashi Corporation and Kajima Corporation, for violating the Antimonopoly Act and the Penal Code's bid-rigging provisions (Article 96-3). The case centered on public works tenders for the Chuo Shinkansen maglev line, where the defendants allegedly pre-arranged successful bidders and rotated contracts, undermining fair competition. The prosecution argued that the collusion inflated costs and damaged public trust. The defense contended that the arrangements were customary industry practices. The trial drew attention as a landmark case against entrenched collusion in Japan's construction sector.

The Tokyo District Court found some defendants guilty, imposing suspended prison sentences on the executives and levying fines on the corporations under the dual criminal-administrative framework. The court acknowledged the existence of collusive arrangements but took into account the companies' subsequent compliance reforms.

Whether the defendants' conduct constituted "substantial restraint of competition" under the Antimonopoly Act and whether the elements of criminal bid obstruction under Article 96-3 of the Penal Code were met, given the defense's argument that the practices were customary and not secretive.

The verdict intensified public scrutiny over Japan's dango (bid-rigging) culture, prompting calls for stricter penalties and procurement reforms. It also influenced the Fair Trade Commission to strengthen surveillance of public infrastructure projects, and several local governments revised their bidding rules to enhance transparency.