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The Games organizing committee said there were too many doubts over the emblem for it to be used.
Logo designer Kenjiro Sano admitted copying online material when questioned by organizers, Japanese media reported.
A Belgian artist had complained that his design was stolen.
In July Japan also scrapped a controversial design for the new Olympic stadium.
“We have reached a conclusion that it would be only appropriate for us to drop the logo and develop a new emblem,” Toshio Muto, director general of the Tokyo organizing committee, told a news conference.
“At this point, we have decided that the logo cannot gain public support.”
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