Japan's telecom ministry has instructed NTT DoCoMo and SoftBank to stop violating guidelines seeking to curb excessive smartphone discounts.
The Internal Affairs and Communications Ministry has told the operators to cease selling smartphones effectively for free or nearly free, the Japan Timesreported.
New guidelines introduced in February seek to end the practice of offering excessive smartphone subsidies to poach customers.
The guidelines only allow Japanese operators to offer handset for free if they need to sell out stocks of old models or to encourage users to switch from feature phones to smartphones.
But the report notes that DoCoMo and SoftBank have been selling new smartphones effectively for free, and the ministry has concluded that they are in violation of the guidelines.
DoCoMo has been effectively selling smartphones for a mere 648 yen ($5.91) per unit if families buy more than one at a time. SoftBank offers discounts and subsidies of up to 21,168 yen for customers switching from another operator.