Offices Raided in Japanese Bid-Rig Case : Antitrust: The FTC investigation centers on bids by Japanese contractors at the U.S. Air Force base near Tokyo.

Japanese antitrust authorities have searched the offices of a group of companies--including a subsidiary of the electronics giant NEC Corp.--in connection with U.S. allegations of bid-rigging on telecommunications contracts at an American military base in Japan, officials said today.

The raid by investigators from the Japan Fair Trade Commission (FTC) at some 20 locations Wednesday came as criticism mounted, both domestically and from abroad, that the agency has been relatively lax in its enforcement activities.

Antitrust regulation is expected to be a prominent issue when U.S. and Japanese negotiators meet later this month for the third round of the Structural Impediments Initiative talks, which aim to identify structural barriers to free trade.

The FTC investigation centers on bidding by Japanese contractors at Yokota Air Base, the U.S. Air Force installation west of Tokyo that also serves as the headquarters for the U.S. Forces in Japan. Eichiro Kokubo, a spokesman for the FTC, said investigators seized a number of documents as evidence and will look into allegations that NEC Information Technology Ltd. led a dango-- or bid-rigging--cartel at the base.

In late 1988, the FTC levied sanctions against a dango group of 140 Japanese companies found to have rigged bids at the U.S. Naval base at Yokosuka, Japan. The U.S. Justice Department last year collected about $32 million in damages from 99 of those companies, after threatening legal action in U.S. courts.

The new dango case apparently stems from a whistle-blower lawsuit filed in federal court in Jacksonville, Fla., by the former chief of the contracts law division at Yokota, Arthur Williams. Court records have been sealed at the request of the Air Force, according to Electronic Engineering Times, a trade publication covering the electronics industry.

NEC Information Technology, a wholly owned subsidiary of NEC, is suspected of inflating the price of telecommunications maintenance contracts at Yokota by restraining competition. Spokesmen for both the parent and subsidiary denied any wrongdoing and said the investigation would clear them.

“There’s no truth to it,” said NEC spokesman Kazuya Yoshida.

NEC Information Technology did significantly lower the price of its contract bid last spring, however, when the Air Force requested it to submit proposals for service using fewer employees, said spokesman Nobuyuki Murakami.

The price cutting--by about half--took place at the same time base authorities received a competitive bid from an American firm, Honolulu-based Hawaiian Telephone Co., but it was “coincidental” and not necessarily in response to the competition, Murakami said.

Bill French, the overseas project manager for Hawaiian Telephone, said his company had maintained a limited presence in the U.S. military market in Japan for the past two decades but launched an aggressive marketing initiative at the end of 1987, initially winning two major contracts for optic fiber, microwave and digital switching services, mostly on Okinawa.

But the U.S. firm quickly found inroads blocked by uncanny competition from NEC, he said.