Japan Investigates Nissin Food Products for Price-Fixing

The Japan Fair Trade Commission (JFTC) has launched an investigation into Nissin Food Products Co., the renowned instant noodle manufacturer, for allegedly engaging in price-fixing practices. According to the Asahi Shimbun, the investigation, which began in April, centers on suspicions that Nissin compelled retailers to raise prices on five of its flagship products in violation of Japan’s Anti-Monopoly Law.

The JFTC’s probe has revealed that Nissin Food Products may have exerted undue pressure on several hundred retailers across Japan, including supermarkets and drugstores, to increase the retail prices of key items. The products involved are some of Nissin’s most popular offerings, such as the original Cup Noodle, its curry and seafood variants, Nissin Donbei Bowl Kitsune Udon, and Nissin U.F.O. yakisoba stir fry noodles.

Per the Asahi, Nissin allegedly provided specific price increase targets to these retailers, a practice that potentially dates back to 2015. Under Japan’s Anti-Monopoly Law, manufacturers are prohibited from dictating retail prices, a regulation designed to promote competitive pricing and protect consumer choice.

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In response to the investigation, Nissin has acknowledged the inquiry, stating, “It is true that we are under investigation from the FTC. We are earnestly cooperating with the investigation.”

As a result of the findings, the JFTC is expected to issue a formal warning to Nissin Food Products, urging the company to cease any restrictive pricing practices immediately. The watchdog will also require the company to implement measures to prevent such violations from recurring in the future.

The investigation has also highlighted the broader issue of inflation, which has affected the pricing of Nissin’s products. In June 2022, the company adjusted the suggested retail prices of 180 items, including Cup Noodle, and again in June 2023, when it raised prices on 170 products. Over the past two years, the suggested retail price for Cup Noodle, one of the company’s signature products, has increased from 193 yen ($1.32), excluding tax, to 236 yen.

Source: Asahi