Japanese regulator recommends Rakuten be ordered to halt free shipping plan

Japan’s Fair Trade Commission said on Friday it has recommended a Tokyo court order e-commerce firm Rakuten Inc to halt the introduction of free shipping, following complaints from vendors over the plans.

Rakuten plans to introduce free shipping on purchases at its online mall on orders over 3,980 yen ($36) from March 18. Vendors have complained they are being forced to shoulder the shipping costs, undercutting margins.

The commission’s recommendation is a threat to Rakuten CEO Hiroshi Mikitani’s drive to take on rivals like Amazon. Rakuten was raided by the regulator earlier this month.

A Rakuten spokeswoman said the company believed it was operating within the law and intended to introduce free shipping as planned.