Japan’s antitrust watchdog inspected Microsoft’s Japanese arm on Wednesday over suspected competition breaches.
The Japan Fair Trade Commission is investigating whether Microsoft’s Azure cloud platform unfairly discouraged customers from using rival services.
A source familiar with the matter told Reuters that officials suspect restrictive contract terms may have limited access to competing cloud infrastructure.
Investigators are also examining whether key software products were effectively confined to Microsoft’s own ecosystem.
According to Japanese media, these programmes include Microsoft 365 applications such as Teams and Word, which are deeply integrated into many corporate systems.
Regulators believe such bundling could have reduced customer choice in Japan’s fast-growing cloud computing market.
According to the source, authorities are also expected to seek clarification from Microsoft’s US parent company.
The Fair Trade Commission declined to comment. Microsoft said it is cooperating fully with the investigation.
"We are fully cooperating with the JFTC (Japan Fair Trade Commission) in their requests," a spokesperson for Microsoft told AFP.
Japan tightens rules
Japan joins a growing list of jurisdictions scrutinising competition in the cloud sector.
Regulators in the United Kingdom, the European Union and the United States have launched their own reviews of industry practices.
Brazil’s antitrust authority last month also opened an administrative probe into Microsoft’s local cloud operations.
Tokyo has, in recent years, tightened oversight of global technology companies suspected of exploiting dominance across digital markets.
Regulators issued a cease-and-desist order in August against Google over conditions linked to Android smartphone distribution.
In 2024, authorities also inspected Amazon’s Japanese unit over allegations it used its marketplace position to pressure sellers.
Amazon Japan used its coveted "buy box" — a prominent spot on its website — against sellers, pressuring them into lowering prices to give it a competitive edge over rival e-commerce sites, the JFTC said.
