Nichirin, a Kobe-based maker of automotive, housing and industrial hoses with ¥2.158bn in capital, must pay any outstanding balance owed to 25 smaller suppliers after Japan's Fair Trade Commission found it left them storing molds and jigs for free while barely ordering parts made with that tooling.
The commission's recommendation, issued September 3, 2026 jointly with the Small and Medium Enterprise Agency, traces to an investigation by the Kansai Bureau of Economy, Trade and Industry. The agency's chief filed a formal measure request with the JFTC on July 16, 2026, under Article 6 of the pre-amendment Subcontract Act, which set the case in motion.
Nichirin lent molds and jigs it owned, or that belonged to its customers, to the 25 subcontractors so they could produce automotive hoses (including motorcycle hoses), housing-related hoses, industrial hoses and related parts. From at least September 1, 2024 through July 28, 2026, nearly two years, Nichirin went long stretches without ordering the parts those molds were built to make. It never paid the subcontractors for storing the tooling in the meantime: 1,048 molds and jigs spread across the 25 firms, held at their own expense. The JFTC ruled this an unlawful demand for economic benefit under Article 4, Paragraph 2, Item 3 of the pre-amendment Subcontract Act.
| Detail | Figure |
|---|---|
| Violation period | September 1, 2024 to July 28, 2026 |
| Molds and jigs left uncompensated | 1,048 units across 25 subcontractors |
| Amount already paid | ¥9.79mn, paid by July 31, 2026 |
| Remaining amount owed | To be paid after JFTC confirms the balance |
| Compliance steps ordered | Board resolution, staff training, subcontractor notice, report to JFTC |
Nichirin has already paid ¥9.79mn to the 25 subcontractors, covering storage costs from September 2024 through the end of 2025, a sum the JFTC says includes part of the detriment owed. The recommendation does not treat that payment as final. It orders Nichirin to pay any remaining amount, once the JFTC confirms the balance, promptly after that confirmation.
Beyond the payment, the recommendation requires Nichirin's board to formally acknowledge the violation and commit to not repeating it, run training for executives and ordering staff under the renamed subcontracting law that took effect in January 2026, notify its own staff and the affected subcontractors of the recommendation's contents, and report back to the JFTC on every step taken.
The case tests enforcement across a legal handover: commissions placed through December 2025 fall under the old Subcontract Act, while anything from January 2026 onward falls under its renamed successor, and the JFTC applied both frameworks depending on when each order was placed.