Those arrested alongside the 39-year-old producer, Junho Sakai, also known as Simon, include Yudai Hasegawa, 38, and Noritoshi Yanagawa, 51, both employees of Japanese entertainment company Avex Inc.
Investigators suspect that the four possessed a bag of cocaine powder in a hotel room at around 12:20 am on Monday.
Four bags of white powder, believed to be cocaine, and one bag of plant fragments, believed to be dried cannabis, were seized from the room. All of these were found on a desk.
XG was on a world tour and had a performance in Nagoya, the capital of Aichi, on Sunday.
Tokyo's Metropolitan Police Department began investigations in March last year after receiving an anonymous report.
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