Hakuhodo Ordered to Pay 200 M. Yen over Tokyo Games Bid-Rigging

Jiji Press

16:55 JST, July 11, 2024

Tokyo, July 11 (Jiji Press) — Tokyo District Court on Thursday ordered major Japanese advertising agency Hakuhodo Inc. to pay ¥200 million  in fines for violating the antimonopoly law by rigging bids linked to the Tokyo Olympics and Paralympics held in 2021.

Hakuhodo became the first company to receive a court ruling over a high-profile series of Tokyo Games-linked bid-rigging cases.

The district court also sentenced Kenichiro Yokomizo, 57, former president of a Hakuhodo group firm, to 18 months in prison, suspended for three years, also on charges of violating the antimonopoly law.

Presiding Judge Kenji Yasunaga said that Yokomizo attempted to prearrange bidding prices and winners with related companies in line with the wishes of Yasuo Mori, 57, a former senior official of the Tokyo Games organizing committee who has been convicted of antimonopoly law violation.

According to the ruling, Yokomizo conspired with Mori and others to decide winners in advance for bidding for contracts to plan Tokyo Games-related test events in February-July 2018. Only the preselected winners participated in the bidding.

The defense side had denied that Yokomizo recognized his acts as bid-rigging.

The judge refuted the claim, however, by saying that officials of companies involved met with Mori and “mutually recognized other companies’ actions toward bidding and formed a common intention to keep pace.”

He also said that Yokomizo made an “easy choice” even though it was intended to work for his company’s profits.

Meanwhile, the court did not recognize that information was exchanged among related companies on whether to participate in the bidding as well as the bidding prices, concluding that a suspended sentence for Yokomizo is appropriate because the degree of restricting competition was not necessarily strong.

Over the bid-rigging related to the Tokyo Games, six companies, including Hakuhodo, and seven individuals, including Mori, have been indicted.

Of the companies, three major event firms, including Cerespo Co., have denied all the charges against them, while major advertising companies Dentsu Group Inc. and Tokyu Agency Inc. have partially denied the allegations.