By FUMIKO KURIBAYASHI/ Staff Writer
March 6, 2020 at 17:55 JST
Hiroshi Mikitani, chairman and CEO of Rakuten Inc., at the company’s headquarters in Tokyo on Feb. 13 (Asahi Shimbun file photo)
Angry sellers who have opposed Rakuten Inc.’s new free shipping policy may have bought themselves more time before the service starts, thanks to the novel coronavirus.
The e-commerce giant on March 6 announced that its new free shipping policy will start on March 18 as scheduled, but only with sellers who are ready to do so.
The company said it has decided to review the contentious policy as a response to the deadly infectious disease.
Some sellers on March 5 urged Rakuten to postpone the March 18 launch, saying that the spread of the novel coronavirus has caused a labor shortage in the delivery operation.
It has not been decided when to require all sellers to offer free shipping, Rakuten said.
If a seller loses money because of the free shipping policy, Rakuten will make up for the loss for a certain period of time, the company also said.
Rakuten has pledged to introduce free shipping on all orders of 3,980 yen ($37.60) or more, including tax, with the exception of shipments from Okinawa Prefecture or remote islands.
But the plan, announced by Hiroshi Mikitani, Rakuten chairman and CEO, in early 2019, has drawn fire from some sellers and antitrust authorities. They claim the new policy could impose a one-sided burden on sellers and violate the Anti-Monopoly Law.
The Fair Trade Commission (FTC) warned Rakuten in the fall and searched the company’s headquarters on Feb. 10. FTC officials also asked the Tokyo District Court on Feb. 28 for an emergency court order to stop Rakuten’s new policy.
Mikitani has insisted the free shipping policy is a win-win for sellers and customers because it would attract more shoppers and be a countermeasure against competitors, such as Amazon Japan.
Amazon Japan offers free shipping on orders of 2,000 yen or more.
Mikitani has said with the introduction of the free shipping policy, customers will have a much easier time navigating the online shops and understanding the final sales price.
“We will follow through (on free shipping) at any cost even if we face off against the government and the FTC,” Mikitani has said.
But under pressure from authorities and unhappy sellers, Rakuten changed the wording of the plan from “free shipping” to “shipping fees included.”
It appears that Rakuten hopes the latest decision will deter the court from issuing an emergency suspension order.
But the FTC has had issues with Rakuten’s free shipping policy in that it would take away sellers’ freedom to set a price.
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