Maglev train bidding obstruction probe spreads to Shimizu, Taisei

Maglev train bidding obstruction probe spreads to Shimizu, Taisei

TOKYO-Prosecutors have questioned executives of major construction companies Shimizu Corp and Taisei Corp on a voluntary basis about alleged obstruction by Obayashi Corp in bidding on contracts for a massive maglev train project, sources close to the matter said Wednesday.

Those three major construction companies and Kajima Corp won contracts for 15 out of 22 construction projects involved in building an ultra high-speed train line making it possible to travel from Tokyo to Osaka in about an hour.

The special investigation squad of the Tokyo District Public Prosecutors Office has already quizzed Obayashi and Kajima executives over the alleged fraud in the bidding process that resulted in an Obayashi-led consortium winning a 9 billion yen contract in April 2016 to build an emergency exit.

The prosecutors will investigate whether there was also fraud in other tenders for the 9 trillion yen next-generation high-speed train project, the sources said.

When finished, Central Japan Railway Co will operate the world’s first project using superconducting magnetic levitation technology. The train will travel at a top speed of 500 kilometers per hour, much faster than current shinkansen bullet trains.

In 2015, JR Central issued a tender to build in Nagoya an emergency exit to be used in case of accident or fire. Obayashi and its joint venture partners Toda Corp and JR Tokai Construction Co won the contract following a two-phase screening.

Obayashi secured three more contracts while Kajima won three, and Shimizu and Taisei both won four contracts to build separate sections of the maglev train project.

The prosecutors searched the headquarters of Obayashi last week on suspicion of fraudulent obstruction of business. A 66-year-old vice president, who presides over Obayashi’s civil engineering unit, as well as other executives of the four major construction companies have been questioned voluntarily.

A JR Central official allegedly leaked bidding information such as estimated construction costs and details of other companies set to join the bid. Obayashi is suspected of getting other construction companies to submit higher bids, leading them to be ruled out, according to separate sources.

An Obayashi official denied the allegations during questioning, saying that Obayashi had not received confidential information from JR Central, according to a person familiar with the matter.

At a press conference Wednesday, JR Central President Koei Tsuge said, “We would like to make efforts to grasp (the situation) and observe the progress of the investigation.” But he declined to comment on suspected bidding information leak by a company official.

Tsuge said JR Central will advance the maglev train project as planned and does not expect any impact on the overall work.

Photo Caption: Shimizu Corporation’s New Tokyo Headquarters

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