Japan's Digital Platform Regulation — New Rules Drawn by the Transparency Act, Smartphone Act, and Information Platform Response Act

Japan's digital platform regulation is moving simultaneously through three laws. The Transparency Act (Act on Improving Transparency and Fairness of Specified Digital Platforms), the Smartphone Software Competition Promotion Act, and the Information Circulation Platform Response Act. The administering agencies differ—METI, the Fair Trade Commission, and MIC—each establishing different regulatory approaches for platform operators.

The Transparency Act was the first to be enforced. Since its implementation in 2021, METI has designated Amazon, Rakuten, Yahoo! Shopping, Apple, Google, Meta, and LINEYahoo as "Specified Digital Platform Providers." Designated operators are required to submit annual self-evaluation reports and disclose key parameters of algorithms that influence search rankings. However, penalties for violations are extremely low at under 1 million yen, raising questions about the effectiveness of sanctions.

Two laws were enacted in succession in 2025. The Information Circulation Platform Response Act, implemented in April under MIC's jurisdiction, designated nine companies including Google, Meta, X, TikTok, and LINEYahoo. It requires operators to notify response results within one week of deletion requests for rights-infringing information such as defamatory content. The Smartphone Software Competition Promotion Act, fully enforced in December, saw the Fair Trade Commission designate Apple and Google, mandating the opening of third-party app stores, permission for external payment methods, and prohibition of browser engine restrictions. Surcharges are set at 20% of domestic sales, or 30% for repeat violations—levels orders of magnitude higher than the Transparency Act.

The scale of markets regulated by these three laws is enormous. Internet advertising spending in 2024 reached 3.65 trillion yen, growing to account for 47.6% of total advertising expenditure. SNS users number 97 million, reaching 78.6% of the population. Japan's e-commerce market is approximately 17.7 trillion yen in scale, with Amazon.co.jp alone holding about 49.6% of the domestic EC market share. Hundreds of millions of people's economic activities and information access rest upon this market foundation.

Japan's platform regulation has progressed several years behind EU developments. The EU enacted the Digital Services Act (DSA) and Digital Markets Act (DMA) in 2022, beginning full enforcement in 2024. The DMA mandates gatekeeper companies to open app stores and ensure data portability, imposing fines of up to 10% of global sales (20% for repeat violations). The DSA requires large platforms to assess and mitigate systemic risks, with penalties of up to 6% of global sales. In December 2025, X Corp. (formerly Twitter) was fined 120 million euros. The EU system is a mandatory regulatory model with centralized enforcement by the European Commission.

Japan's system adopts a different "co-regulatory model." The Transparency Act uses a framework where operators voluntarily report improvement status through annual reports, which METI then evaluates. Penalties are designed to be restrained, prioritizing improvement through dialogue over direct administrative orders. While this approach reduces regulatory costs and respects operator autonomy, it has structural weaknesses in lacking effective measures when improvements don't progress.

Another important difference lies in institutional comprehensiveness. The EU's DSA/DMA explicitly establish data portability rights, guaranteeing users' rights to transfer their data to other services. Large platforms are also mandated to conduct risk assessments and annual audits for systemic risks (disinformation spread, electoral influence, harmful content for minors). Japan's three laws lack equivalent provisions. Regarding algorithm disclosure, the Transparency Act only requires disclosure of "key parameters," not mandating disclosure of reasons why specific displays or recommendations occur.

However, the penalty levels in the Smartphone Software Competition Promotion Act are noteworthy. The 20% of domestic sales level exceeds the EU DMA's 10%. This is the first time such high penalty rates have been set in Japan's competition law system. The Fair Trade Commission's jurisdiction allows utilization of antitrust law enforcement expertise, distinguishing it from the Transparency Act framework. Despite belonging to the same "platform regulation" category, the three laws show significant variation in design philosophy.

Examining the three laws together reveals structural characteristics of Japan's platform regulation. First, siloed institutional design. METI (Transparency Act), MIC (Information Platform Act), and the Fair Trade Commission (Smartphone Act) each have independent jurisdiction with different regulatory targets and purposes. However, real platform operators integrate EC, advertising, content distribution, and app stores. Google is a designated operator under all three laws: the Transparency Act for EC, the Information Platform Act for information circulation, and the Smartphone Act for app stores. The structure where three laws separately regulate what users see as one platform creates challenges for regulatory consistency and efficiency.

Second, penalty asymmetry. There's a gap of thousands to tens of thousands of times between the Transparency Act's maximum fine of 1 million yen and the Smartphone Act's surcharges (20% of domestic sales). This asymmetry reflects not only differences in enactment timing (2020 vs. 2024) but also differences in regulatory authority characteristics. METI emphasizes balance between industrial promotion and regulation, while the Fair Trade Commission's primary mission is maintaining competitive order. Having such different regulatory philosophies within the same "platform regulation" makes the overall institutional message ambiguous. For operators too, it's difficult to see criteria for prioritizing which law's obligations.

Third are the limitations and possibilities of the self-reporting model. The "self-evaluation report" framework adopted by the Transparency Act is often criticized as "weak regulation." However, viewed differently, this design also requires operators to internalize the system. Rather than using penalty threats to ensure minimum obligation compliance, operators structurally reflect on their own operations and cycle improvements—as an ideal, this could have more sustainable effects than simple regulation. The problem is insufficient establishment of preconditions for this ideal to function—adequate information disclosure, effective monitoring, and escalation measures when improvements don't progress.

From a Social Vision Design perspective, there's one important absence in the institutional space these three laws create. That's the positioning of "users." The Transparency Act focuses on business-to-business transaction transparency, the Information Platform Act on responding to rights-infringing information, and the Smartphone Act on app market competition conditions. However, they don't directly address questions about how platform users can manage their own data, how they can engage with algorithmic recommendations and displays, and how they can move between platforms—that is, how to institutionally guarantee citizen autonomy in digital spaces. The EU's legal establishment of data portability and risk assessment obligations was precisely one response to these questions.

Japan's platform regulation, even with all three laws in place, still hasn't fully drawn the overall institutional picture. Will the siloed jurisdiction system move toward integration, or be maintained as an accumulation of individual laws? Can the Transparency Act's self-reporting model gain effectiveness through accumulated results, or will it end in repetitive formal reporting?

If the Smartphone Act's 20% surcharge is actually applied, Japan's platform regulation will enter a new phase. However, laws without enforcement records remain merely one risk factor rather than norms for operators. Compared to the EU imposing a 120 million euro fine on X Corp. just one year after DSA/DMA enforcement, we can see the distance between legal text and enforcement records.

97 million SNS users and a 17.7 trillion yen EC market. There's no single correct answer to what regulatory framework is appropriate for this scale of digital economy. The EU model's strictness isn't always optimal. However, the absence of issues like user data sovereignty and algorithmic accountability from institutional scope reflects not regulatory deficiencies but the absence of social discussion. Now that the three laws have begun operating, it's time to raise questions not just from institutional designers but from citizens living in that space about "how to design digital spaces as what kind of places"—questions that go beyond legal provisions.

References

特定デジタルプラットフォームの透明性及び公正性の向上に関する法律 — 経済産業省. 経済産業省

スマートフォンにおいて利用される特定ソフトウェアに係る競争の促進に関する法律 — 公正取引委員会. 公正取引委員会

情報流通プラットフォーム対処法（改正プロバイダ責任制限法） — 総務省. 総務省

Digital Services Act (DSA) & Digital Markets Act (DMA) — European Commission. European Commission

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