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| 7th Report of Market Access Ombudsman Council (March 18, 2002) |
1. Complainant: Sapporo Chamber of Commerce and Industry
2. Ministry concerned: Ministry of Economy, Trade and Industry
3. Complaint:
Laver is a non-liberalized item under the Exchange and Foreign Trade Law and the Cabinet Order Concerning Control of Import Trade and it cannot be imported to Japan unless one receives an import quota.
As to allocation of a quota based on imports of the previous year, it can be made electronically via JETRAS. But, as to first-come, first-served allotments and fresh allotments, applicants have to go to the head office of the Ministry of Economy, Trade and Industry to make an application. This is too heavy a burden for operators in remote areas, such as Hokkaido.
In the case of application for supposedly first-come, first-service allotments in the first half of fiscal 2001, the Ministry of Economy, Trade and Industry hastily changed the allocation method and determined the order of application by lots, as the number of applicants was far more than the ministry had expected. (For an operator in Sapporo that visits Tokyo believing that application is on a first-come, first-served basis, it would be a huge time and financial loss if the application method is changed to a lot system and if he draws a losing number. It would be difficult for the operator to carry on business systematically.)
Therefore, in order to make application for first-come, first-served allotments and fresh allotments easy for business operators in distant places, we would like the ministry to 1] allow electronic application or application by mail, or 2] accept applications at Regional Bureaus of Economy, Trade and Industry.
(Second complaint)
(1) The Ministry of Economy, Trade and Industry stated that it adopted the lot method for application for first-come, first-served allotments based on the import announcement dated March 27, 2001. However, the import announcement only stated that "If the total number of applications for import quota allocation exceeds the maximum limit of import quota allocation, the order of application shall be determined by lots," and describes conditions for determining the order by merely drawing lots (The possibility thereof is described.) From the viewpoint of importing firms, they cannot certainly know whether or not a drawing of lots will actually be held.
In order to avoid confusion on the acceptance day of application for first-come, first-served allotments and ensure efficient operational activities, the ministry should improve the method for application for first-come, first-served allotments so that, if the order is to be determined by drawing lots it will be determined and announced beforehand.
As for applications in fiscal 2001, so many applicants (more than 3,000) assembled that the Ministry of Economy, Trade and Industry had to hastily change the scheduled lot site. The lot site was so crowded and chaotic that even emergency exits could not be identified, and there was concern that a catastrophe will occur in the event of fire.
In fiscal 2002, the number of applications is expected to be twice or three times as many as the last fiscal year due to promotion of Japan-South Korea exchanges, so the lot site is expected to be even more crowded and chaotic.
The Ministry of Economy, Trade and Industry should reveal how it plans to deal with such conditions.
Furthermore, in order to prevent the crowded and chaotic conditions mentioned above, the ministry should improve the application method as stated below so that operators in remote areas do not need to go all the way to Tokyo.
(2) The Ministry of Economy, Trade and Industry claims that a drawing of lots by applicants in front of other applicants contributes to fair and prompt screening. However, those who drew lots were not applicants themselves but students or housewives, who were part-time workers employed by major trading firms located in Tokyo to file applications even by using the names of affiliated companies.
Seeing such conditions, we cannot help but consider the ministry's claim a sophism.
Moreover, the Ministry of Economy, Trade and Industry stated that a drawing of lots can prevent duplicate applicants and ensure fair and prompt screening, but we believe this idea is exceedingly dated.
Duplicate applicants can be eliminated by computerization with higher reliability and less paper work. The time required from the initial application to the issuance of an import quota certificate would also be shortened under an electronic environment.
We therefore believe that the Ministry of Economy Trade and Industry should aim at simplifying and rationalizing application procedures for operators in remote areas 1) by managing applicants for first-come, first-served allotments and lots under an electronic environment and 2) by taking measures to carry out paper screening on candidates determined under such an environment at each regional Bureau of Economy, Trade and Industry.
(Third complaint)
We are surprised to read the second corresponding policy of the Ministry of Economy, Trade and Industry, in which the ministry is trying to justify its operations by using one sophism after another. That nobody knows how many applicants visit the ministry on the application date makes it all the more necessary to accept application papers at local offices beforehand or electronic application. Small and medium-sized enterprises are calling for such a measure for financial reasons as well.
The story that applicants wanted to have the drawing of lots held in front of them is dated. All the applicants we contacted at the lot site last year questioned the advisability of holding a drawing of lots in front of all applicants.
We believe that the Ministry of Economy, Trade and Industry is seriously tackling the issue of computerizing licensing and other operations, which is one of the major objectives of the structural reforms now being promoted by the government. We, as small businesses, want to ask the Ministry of Economy, Trade and Industry, which is dealing with measures for new businesses and start-up businesses, to promote reform in real earnest.
We will not take issue with the ministry on proxy applicants, changes of venue, dangerous lot sites, etc. any longer, because they boil down to nothing more than gutter-level controversy.
However, simplifying application acceptance is necessary both for applicants and for the Ministry of Economy, Trade and Industry. We want the ministry to simplify the application system by all means in the near future.
4. Corresponding Policy of the Ministries concerned:
With regard to the complainant's request that the ministry should either 1] allow electronic application or application by mail, or 2] accept applications at a regional Bureau of Economy, Trade and Industry, we cannot accept the request for the following reasons:
(1) Implementation of fair lots in response to requests from applicants
We have adopted the lot method for application for first-come, first-served quota allotments for laver based on Nov. 52-6 of the official import announcement dated March 27, 2001 as there are a large number of applicants (in fiscal 2000, there were 1,274 applicants as against 230 successful applicants).
The lot is held before the eyes of all applicants in order to prevent duplicate applications and ensure fair, prompt screening. Applicants who draw winning numbers are declared successful applicants. Of them, those who passed the screening of papers will be allotted a quota.
We have decided to hold the drawing of lots in front of the applicants because a large majority of the applicants strongly request that it be held before their eyes.
We do not accept electronic application because it does not allow us to hold a drawing of lots in front of the applicants.
(2) Securing prompt screening
If we accepted electronic application, application by mail, or application at a regional Bureau of Economy, Trade and Industry, the applicants may not need to come to Tokyo. But, they still have to come to Tokyo to take part in the drawing of lots when they undergo paper screening. Therefore, even if we adopted this method, it would only prolong the time required from the application to the issuance of an import quota certificate and would rather infringe on the interest of the applicants.
Judging from the request from a large majority of applicants and the need to ensure prompt screening as we mentioned above, it is inevitable for us to stick to the current method.
(Second corresponding policy)
The complainant says that whether or not a drawing of lots will be held should be determined and announced beforehand. It is difficult for us to announce it beforehand, because we don't know how many applicants are coming until the application day. With regard to the drawing of lots in fiscal 2001, the complainant says the venue where it was to take place was changed. This is not true. Since this year's drawing of lots is also expected to draw many applicants, we are striving to secure an appropriate place to hold the drawing of lots promptly.
The complainant also says that many of the applicants were part-time workers. But, we don't think there were cases of name borrowing. The persons who drew lots met the requirements of being those "who import goods in their own name and at their own risk." In view of the fact that a large majority of applicants want the drawing of lots to be held in front of them, it is difficult to introduce an electronic application system.
(Third corresponding policy)
We are aware of the importance of simplifying application procedures and will continue studying what measures we can take to do so. We intend to aggressively promote the computerization of application but we would like the complainant to understand that there are still technical problems.
5. Remarks
The complainant accepted this policy.