The Japan Fair Trade Commission (JFTC) recommended on September 29, 2026 that a Tokyo-based maker of air-blast equipment pay 46 small subcontractors what it still owed them. The commission found the company paid late, mostly by handing over electronic recorded claims that could not be exchanged for the full cash amount by the due date. The company has capital of ¥100mn and, at the time of the orders, employed more than 300 people.
Three payment methods, one violation
The company commissioned parts manufacturing from 44 subcontractors and transport of finished equipment from two. For 45 of them, payment was due at the end of the month after delivery or transport; for one, it was due at the end of the month after next. The JFTC counted three kinds of late payment, all under the ban on paying after the due date.
| Payment method | Subcontractors | Amount |
|---|---|---|
| Paid beyond 60 days after receipt | 1 | ¥309,892 |
| Bills | 5 | ¥3.87mn |
| Electronic claims not convertible to full cash by due date | 40 | ¥70.79mn |
The JFTC dates the use of bills and electronic claims to February through May 2026. The three amounts add up to the ¥74.97mn the JFTC treats as delayed. The company has paid ¥64.93mn of that total by August 2026, so the paid sum sits inside the ¥74.97mn and is not an extra amount. The one subcontractor paid beyond 60 days and the five bill recipients were paid in full by July. Of the 40 electronic-claim recipients, the record shows payments to 38, excluding two.
What the company must do
The company must pay the remaining balance, after applying the ¥64.93mn already paid, once the JFTC has confirmed the amount. It must also pay late interest at 14.6% a year, counted from the 60th day after it received each subcontractor's delivery or service. If any of 45 subcontractors bore fees to receive the money, the company must reimburse them. Payment must be in cash or an equivalent means.
The recommendation also requires a board resolution confirming that the conduct broke the law and that future payments will fall due within 60 days of receipt, as early as possible. The company must take internal steps to prevent a repeat, such as training its purchasing staff on the law. It must also tell its officers, employees and subcontractors about the recommendation and report its steps to the JFTC.
Why the case is a test of the revised law
The Small and Medium Enterprise Agency's chief asked the JFTC to act on September 3, after the Kanto Bureau of Economy, Trade and Industry investigated. The JFTC says the revised law, in force since January 1, 2026, bans paying by bill and paying with electronic claims that cannot be swapped for the full amount by the due date. The revision also added an employee-count test, under which a contractor with 300 or fewer employees can qualify as protected. Twenty of the 46 subcontractors here qualified only through that test.
The JFTC's companion leaflet adds a second date: from April 1, 2027, manufacturing-type transactions outside the law's scope must also set payment due dates within 60 days of receipt.