Japan’s Fair Trade Commission (JFTC) conducted a surprise inspection at the Tokyo office of Microsoft Japan on Wednesday (February 25th). The purpose of this action was to investigate whether the software giant has been unfairly restricting customers from using competitors’ cloud services by leveraging its market dominance.
Members of the Japan Fair Trade Commission entered Microsoft Japan’s headquarters in the Tokyo Minato Ward for an on-site inspection. According to sources familiar with the matter and reports from media outlets such as Yomiuri Shimbun, the focus of this investigation revolved around Microsoft’s cloud computing platform, Azure. Japanese regulators suspect that Microsoft has employed the following unfair competitive tactics:
Software bundling and restrictions: Microsoft is accused of making its widely-used Microsoft 365 services (including applications like Word, Teams, and Excel) unable to run smoothly on competitors’ (such as Amazon AWS or Google Cloud) cloud servers, or setting up technical barriers.
Differential licensing: Regulators are verifying whether Microsoft has been indirectly forcing customers to choose Azure by adjusting licensing agreements, or else face higher software usage costs or feature limitations.
A spokesperson for Microsoft Japan stated, “We are fully cooperating with the requests of the Japan Fair Trade Commission.”
This inspection is not an isolated incident. Currently, regulatory agencies in the UK, EU, and the US are also conducting in-depth examinations of Microsoft’s behavior in the cloud computing sector. Brazil’s antitrust authority initiated a related administrative investigation last month.
In recent years, the Japan Fair Trade Commission has significantly strengthened its regulatory oversight of global tech giants (Big Tech) in an attempt to break up market monopolies.
In 2024, Amazon Japan came under scrutiny for allegedly pressuring sellers to lower prices by utilizing the “Buy Box” position.
In August 2025, Google received a corrective order from JFTC for pre-installing app stores on Android phones.
Legal experts point out that if the Japan Fair Trade Commission ultimately determines that Microsoft has violated antitrust laws, the company may face substantial fines and be obliged to amend its software licensing agreements in the Japanese market.
Sources have revealed to Reuters that Japanese authorities, in addition to inspecting the Tokyo office, are expected to engage with Microsoft’s US parent company to clarify the specific impact of its global licensing policies on fair competition in the Japanese market.