Dentsu allegedly took lead in bidding collusion for Tokyo Games

The Yomiuri Shimbun
Investigators carry out cardboard boxes from a building that houses event company Tres Inc., in Chuo Ward, Tokyo, on Tuesday.

In the case of suspected bid-rigging for contracts to plan test events for the Tokyo Olympics and Paralympics, major advertising company Dentsu Inc. allegedly asked other bidders in advance not to participate in bidding except for the venues for which they wished to win the bid, The Yomiuri Shimbun has learned.

The special investigation squad of the Tokyo District Public Prosecutors Office obtained emails suggesting that prior to bidding Dentsu had made such requests to companies that subsequently won bids. The squad considered this to be one piece of evidence indicating that Dentsu and the Tokyo Games organizing committee took the lead in coordinating the bids.

The squad and the Japan Fair Trade Commission on Tuesday raided ADK Marketing Solutions Inc. on suspicion of the company having violated the Antimonopoly Law, following raids on Dentsu on Friday and Hakuhodo Inc. on Monday on suspicion of the same. The latest raid means that Japan’s three largest advertising companies are currently under investigation.

The bids in question were placed for contracts to plan test events conducted by the organizing committee in 2018. There were a total of 26 contracts, each covering test events at one or two venues. Nine companies, including Dentsu, and one joint venture won these contracts, worth a total of some ¥537 million. It is believed that the organizing committee and Dentsu shared a list of potential bidders prior to bidding and that the actual winners of the bids were almost exactly as noted on the list.

According to sources, most of the 26 contracts only had one company bidding. Some successful bidders allegedly told investigators that Dentsu had asked them before the bidding process started to bid only on venues where they wished to win the bid. Investigators have obtained emails implying such a request.

Dentsu executives allegedly denied that they had known about the collusion when they were asked by investigators to answer on a voluntary basis.

Besides ADK Marketing Solutions, the investigative squad and the commission on Tuesday raided Dentsu Live Inc., an advertising production company affiliated with Dentsu Inc., and three Tokyo-based event companies: Shimizu Octo Inc. in Shinjuku Ward, Tres Inc. in Chuo Ward and Jeb Co. in Minato Ward.