Japan FTC conducts on-site inspection of Microsoft - Nikkei

Japan FTC conducts on-site inspection of Microsoft - Nikkei

Japan FTC Conducts On-Site Inspection of Microsoft Japan Over Azure Cloud Practices

Japan’s Fair Trade Commission (FTC) conducted an on-site inspection of Microsoft Japan’s offices on February 25, 2026, as part of an investigation into potential violations of anti-monopoly laws related to the Azure cloud platform. The probe focuses on allegations that Microsoft improperly restricted customers from using competing cloud services by limiting the compatibility of its software with non-Azure platforms.

The FTC’s investigation centers on whether Microsoft’s practices violate Japan’s Antimonopoly Act, which prohibits businesses from engaging in anti-competitive behavior that stifles market fairness. Specifically, regulators are examining whether Azure’s architecture or licensing terms prevent customers from integrating rival cloud services, potentially limiting competition in Japan’s growing cloud computing market. The on-site inspection, a formal step in the FTC’s enforcement process, signals the agency’s intent to assess the scope of the alleged restrictions and determine if further action is warranted.

Microsoft Japan has stated it is “fully cooperating” with the FTC’s requests, while the company has not yet provided additional public comment. The FTC declined to confirm details of the probe, adhering to its standard practice of not commenting on ongoing investigations. If the FTC finds evidence of wrongdoing, potential penalties could include fines or orders to modify business practices, though the outcome remains uncertain at this stage.

The case adds to global scrutiny of cloud providers’ market practices, following similar investigations in other jurisdictions. For Microsoft, the probe underscores the challenges of balancing innovation with regulatory compliance in highly competitive technology sectors. Investors may monitor developments for insights into the FTC’s enforcement priorities and their potential impact on cloud service providers operating in Japan.

Reuters, February 25, 2026: Reuters, February 25, 2026
Bloomberg, February 25, 2026: Bloomberg, February 25, 2026