Jakarta (09/07) - The Indonesia Competition Commission (“ICC”) sums up that there is no potential or alleged violation of Law No. 5 Year 1999 regarding the acquisition conducted by Honda Motor Co., Ltd. (“Honda”) of three spare part companies in Japan, namely Keihin Corporation, Nissin Kogyo, Co ., Ltd., and Showa Corporation. The conclusion was made based on the result of the assessment of ICC as determined through a Commission Meeting that was held on July 7, 2021.

The assessment had its origin from a notification of the share acquisition by Honda of three companies simultaneously, namely Keihin Corporation, Nissin Kogyo Co., Ltd., and Showa Corporation. The three acquired companies are manufacturers of four-wheeled vehicle/car and two-wheeler/motorcycle spare parts headquartered in Japan, with various products relating to electrification systems and engine management, braking systems, and suspensions (shock absorbers). The three companies manufacture and sell spare part products to Honda and other motor vehicle manufacturers, such as Suzuki, Kawasaki, Yamaha, Koike, Daihatsu, and the like.

This transaction constitutes a transaction among foreign business actors conducted in Japan. The notification for the transaction which was effective on  October 22, 2020 was made to ICC on  December 3, 2020, so that it is still within the notification period (30 days after the effective date). Based on the assessment, ICC concludes that there is a vertical integration in the acquisition of shares of the three companies. However, the integration had existed among the parties before the transaction took place. The vertical integration relationship is not exclusive, either, wherein the other business actors outside the Honda business group (such as Yamaha, Kawasaki, and Suzuki) may still obtain vehicle components needed from the acquired parties. The transaction does not provide a significant increase in market power for Honda because of the availability of alternative suppliers of other motor vehicle components in the market. Based on the survey of ICC, the transaction does not result in an increase in the product prices and does not pose a decrease in the quality of the post-acquisition services, either. The parties especially the acquirees remain committed to not stopping their supply to consumers outside the Honda business group in the future.

With due observance of the result of the assessment, ICC has decided to issue an opinion stipulation declaring that there is no finding of alleged monopolistic practices and/or unfair business competition in the transaction conducted by the aforementioned Honda Motor Co., Ltd.