Japan’s leading construction companies have become embroiled in a potentially huge bid-rigging scandal related to the government-supported 9 trillion yen ($80 billion) maglev train project.

Allegations against the companies require all-out efforts by investigators to clarify the entire picture of suspected “dango” collusive deals behind the megaproject.

Investigators from the Tokyo District Public Prosecutors Office and the Fair Trade Commission have started looking into the allegations of collusive bidding concerning contracts for the construction of the magnetically levitated superfast train line, which will link Tokyo to Nagoya and, eventually, Osaka.

Investigators on Dec. 18 searched the Tokyo head offices of Kajima Corp. and Shimizu Corp. for evidence of anti-monopoly violations and plan to soon conduct similar searches at the offices of Taisei Corp. and Obayashi Corp. (Investigators started searches at offices of Taisei and Obayashi on Dec. 19.)

These four construction powerhouses have won 15 of the 22 related contracts that have so far been put out to tender by Central Japan Railway Co. (JR Tokai), which will operate the planned train line known in Japan as the Linear Chuo Shinkansen Line.

Each of the four firms has won three to four of these contracts.

The story of collusion, which first came to light in connection with a project to build an emergency exit in Nagoya as part of the planned train line, seems likely to grow into a major scandal involving the nation’s top general contractors.

Underground sections and tunnels will account for 90 percent of the Tokyo-Nagoya part of the Shinkansen line, which is currently under construction.

The construction works involve building stations 40 meters underground below cities as well as a 25-kilometer tunnel through the Southern Alps, or the Akashi Mountains, a massive mountain range spanning three prefectures in central Japan.

Since the construction plan involves many formidable technological challenges, it is said that only a limited number of construction companies can measure up to the works.

If the firms have colluded to divide up the contracts by taking advantage of this situation, they have committed inexcusable offenses.

Such dango deals hinder fair competition and push up construction costs, causing economic damage to consumers by forcing them to pay higher fares in the future.

In 2005, these four construction companies declared they would never engage in bid-rigging again. But they have apparently failed to keep the vow as a series of revelations have since emerged of their involvement in suspected dango deals including those linked to a project to extend a subway line in Nagoya and the Tokyo-Gaikan Expressway project.

With regard to the Chuo Shinkansen project, the firms submitted written pledges to JR Tokai promising not to leak information about the works.

But they are suspected of having broken their pledges and having colluded with the other members of the group to rig bidding for pricy contracts.

The scandal has raised serious questions about the construction industry’s ability to clean itself up.

We also have something to say to JR Tokai, which has contracted out the works.

Like other new Shinkansen lines, the Linear Chuo Shinkansen Line will be built under the law to support the development of a national network of bullet train lines.

The administration of Prime Minister Shinzo Abe has been promoting the maglev train project under its strategy to stoke economic growth. The Abe administration has decided to spend 3 trillion yen of public funds raised through the government’s debt-financed investment and loans program to subsidize the financing of the project.

This government financial support will allow JR Tokai to raise one-third of the funds needed to construct the line at low interest rates for a total savings of 500 billion yen.

That means the construction of the maglev train line is not purely a private-sector project. It is a national project in which the government is deeply involved.

Bidding for contracts for the project therefore needs to be carried out with high standards of transparency on the same level as those required for public works projects.

JR Tokai has refused to disclose relevant information concerning the contracts won by the four companies, such as the contract prices and the bidders. The train service operator says disclosing such information would affect future bidding.

By withholding such information related to the scandal from the public, the company is failing to fulfill its accountability duties. It should rethink its stance toward the issue.

--The Asahi Shimbun, Dec. 19