Source Facts
What happened
The Japan Fair Trade Commission recommended action against NICHIRIN CO., LTD. under Japan’s Subcontract Act. NICHIRIN had required 25 subcontractors to store a total of 1,048 dies, jigs and other tooling owned by NICHIRIN or its customers, even though no orders for the relevant products had been placed for extended periods. NICHIRIN did not bear the associated storage costs. The JFTC found that this practice constituted an improper request for economic benefits from subcontractors.
Why it matters
Tooling storage can create hidden supplier costs even when production orders have stopped. The recommendation shows that companies in Japan need to review who bears the cost of storing dies, jigs and other tooling during inactive production periods, rather than treating long-term supplier storage as a cost-free arrangement.
Who is affected
Manufacturers that place dies, jigs or other tooling with Japanese suppliers, subcontractors that store customer-owned tooling, and overseas companies relying on Japanese manufacturing partners or supply chains involving customer-owned production equipment.
What to watch next
Watch whether NICHIRIN completes the remaining storage-cost payments required by the recommendation and whether the JFTC applies similar scrutiny to tooling-storage practices at other manufacturers. Companies should also review how inactive, obsolete or low-use tooling is identified, stored, returned or disposed of across supplier networks.
Japan Watchdesk Interpretation
The commercial signal extends beyond NICHIRIN. Overseas manufacturers using Japanese suppliers should understand who bears the cost of storing customer-owned dies, jigs and other tooling when orders become inactive. Supplier due diligence should therefore cover not only quality, price and delivery capacity, but also tooling ownership, storage-cost allocation, return and disposal procedures, and responsibility during periods when no production orders are being placed.
Primary Source
- Source organization
- Japan Fair Trade Commission (JFTC)
- Source publication date
- September 3, 2026
- Last verified
- September 4, 2026
- AI summary status
- Human Edited
- Original source
- Open primary source
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