Database

Browse Database

JAPAN

Since 1988
Since 1965
Since March 2005

Pillar Domestic data policies  |  Indicator Minimum period for data retention
Consumption Tax Act (Act No. 108 of 1988) (昭和六十三年法律第百八号 消費税法)

Corporation Tax Act (Act No. 34 of March 31, 1965) (法人税法(外国法人関連部分)

Companies Act (Act No. 86 of 2005) (平成十七年法律第八十六号 会社法)
Companies are required to retain their records by the following laws:
- The Consumption Tax Act (Act No. 108 of 1988) business operators and special importers to retain consumption tax-related books and records, such as those related to asset transfers or the purchase and collection of taxable goods, for seven years after the year in which they complete the records (Art. 58.1);
- The Corporation Tax Act (Act No. 34 of March 31, 1965): books, records, and documents for seven years (Art. 126.1);
- The Companies Act (Act No. 86 of July 26, 2005): shareholder meeting minutes for ten years (Art. 318.2), account books and important business materials for ten years (Art. 432.2), and financial statements, business reports, and supplementary schedules used to prepare financial statements for ten years (Art. 435.4).
Coverage Horizontal

JAPAN

Since May 1993, last amended in May 2020

Pillar Intellectual Property Rights (IPRs)  |  Indicator Effective protection covering trade secrets
Unfair Competition Prevention Law (Law No. 47 of 1993) (不正競争防止法(平成五年法律第四十七号)
The Unfair Competition Prevention Law (Law No. 47 of 1993) provides a framework for the effective protection of trade secrets. A ‘trade secret’ is defined in the law as a production method, sales method, or any other technical or operational information useful for business activities that are kept secret and are not publicly known (Art. 2). According to Art. 3 of the law, those businesses or persons whose business interests have been, or are threatened to be, infringed on by misappropriation or illegal disclosure shall have the right to seek an injunction. The Unfair Competition Prevention Act provides civil and criminal remedies in such cases where secret information about the company is stolen or disclosed illegally. To protect information according to the Act, companies need to manage such data as “trade secrets”.
Coverage Horizontal

JAPAN

N/A

Pillar Telecom infrastructure & competition  |  Indicator Passive infrastructure sharing obligation
Requirement of passive infrastructure sharing
It is reported that there is an obligation for passive infrastructure sharing in Japan to deliver telecom services to end users.
Coverage Telecommunications sector

JAPAN

Since December 1984, last amended in July 2020

Pillar Telecom infrastructure & competition  |  Indicator Maximum foreign equity share for investment in the telecommunication sector
Act on Nippon Telegraph and Telephone Corporation (Act No. 85 of 1984) (日本電信電話株式会社等に関する法律 (昭和五十九年十二月二十五日法律第八十五号))
According to Arts. 4-6 of the Act on Nippon Telegraph and Telephone Corporation (Act No. 85 of 1984), foreigners' aggregate ownership cannot exceed one-third of the aggregate voting rights of Nippon Telegraph and Telephone Corporation (NTT), which holds all the issued shares of NTT-East and NTT-West.
Coverage Telecommunications sector

JAPAN

Since December 1975, last amended in July 2020

Pillar Telecom infrastructure & competition  |  Indicator Presence of shares owned by the government in telecom companies
Act on Nippon Telegraph and Telephone Corporation (Act No. 85 of 1984) (日本電信電話株式会社等に関する法律 (昭和五十九年十二月二十五日法律第八十五号))
Nippon Telegraph and Telephone Corporation (NTT) is incorporated under the Act on Nippon Telegraph and Telephone Corporation, etc. (Act No. 85 of 1984) (NTT Act). NTT, being the incumbent in the telecommunications industry, is partly owned by the Japanese government with 36% of its stock.
Coverage Telecommunications sector

JAPAN

N/A

Pillar Telecom infrastructure & competition  |  Indicator Functional/accounting separation for operators with significant market power
Requirement of accounting and functional separation for dominant network operators
It is reported that Japan mandates functional and accounting separation for operators with significant market power (SMP) in the telecom market.
Coverage Telecommunications sector

JAPAN

Reported in 2005, last reported in 2023

Pillar Telecom infrastructure & competition  |  Indicator Licensing restrictions to operate in the telecom market
Complaints about arbitrary spectrum allocation
Under the Radio Act (Act No. 131 of 1950) (電波法 (昭和二十五年法律第百三十一号), the allocation of the spectrum is at the discretion of the Ministry of Internal Affairs and Communication (MIC), based on consultation with the Radio Regulatory Council and consideration of plans submitted by the operators. The Act was amended in May 2019 to adopt what is called a "partial auction system," whereby the MIC considers the amount of special fees submitted by the applicant based on their own valuation of the spectrum, although it is not a decisive element. It is reported that the MIC's decision-making is arbitrary and opaque. Moreover, it reported that "several current spectrum allocations create bands unique to Japan (e.g., for self-driving vehicles) that prevent foreign technologies from functioning in Japan".
Coverage Telecommunications sector

JAPAN

Since April 1994

Pillar Telecom infrastructure & competition  |  Indicator Signature of the WTO Telecom Reference Paper
WTO Telecom Reference Paper
Japan has appended the World Trade Organization (WTO) Telecom Reference Paper to its schedule of commitments.
Coverage Telecommunications sector

JAPAN

N/A

Pillar Telecom infrastructure & competition  |  Indicator Presence of an independent telecom authority
Lack of an independent telecom authority
Japan has a telecommunications authority: The Ministry of Internal Affairs and Communications. However, it is reported that this entity's decision-making process is not fully independent of the government.
Coverage Telecommunications sector

JAPAN

Since 2020

Pillar Cross-border data policies  |  Indicator Ban to transfer and local processing requirement
Guidelines on Security Management of Information System and Services Handling Medical Information (医療情報を取り扱う情報システム・サービスの 提供事業者にお る安全管理ガイドライン)
The Guidelines on Security Management of Information System and Services Handling Medical Information provide that information systems for the handling of medical data must be located in the territory of Japan so that in the event of an emergency, Japanese governmental authorities can enforce their power to collect information or issue administrative orders. Although this is not a mandatory requirement based on a specific law, it is reported that some medical institutions have requested that service providers maintain servers inside Japan to comply with these Guidelines.
Coverage Information systems for the handling of medical data

JAPAN

Since 2016, last amended in 2018

Pillar Cross-border data policies  |  Indicator Ban to transfer and local processing requirement
Common Standards for Information Security Measures for Government Agencies and Related Agencies (政府機関等のサイバーセキュリティ対策のための統一基準群)
The National Center of Incident Readiness and Strategy for Cybersecurity (NISC) “Common Standards for Information Security Measures for Government Agencies” allows for government agencies to make use of systems that are "isolated" from the internet if necessary (Chapter 5.2.1). Information on the agencies affected is not readily available.
Coverage Public sector

JAPAN

Since December 1949, last amended in November 2021
Since October 1980, last amended in May 2020
Since May 2020, last amended in May 2023

Pillar Foreign Direct Investment (FDI) in sectors relevant to digital trade  |  Indicator Screening of investment and acquisitions
Foreign Exchange and Foreign Trade Act (Act No. 228 of 1949) (外国為替及び外国貿易法(昭和二十四年法律第二百二十八号))

Cabinet Order on Inward Direct Investment (対内直接投資等に関する政令(昭和五十五年政令第二百六十一号))

List of Classifications of Listed Companies regarding the Prior-notification Requirements on Inward Direct Investment (○本邦上場会社の外為法における対内直接投資等事前届出該当性リスト)
Japan has implemented foreign direct investment (FDI) screening mechanisms through the Foreign Exchange and Foreign Trade Act (Act No. 228 of 1949), supplemented by procedural regulations such as the Cabinet Order on Inward Direct Investment. Under this Act, foreign investors in "Designated Business Sectors" or "Core Business Sectors" are required to submit a prior notification to the relevant ministry. After reviewing the notification, the ministry may either approve, amend, or suspend the proposed investment.
According to the Cabinet Order on Inward Direct Investment, "Core Business Sectors" include industries where foreign investors (e.g., non-residents or foreign corporations) must file prior notification for direct investment, such as acquiring 1% or more of voting rights in a listed company or purchasing shares in an unlisted company. These sectors, considered highly sensitive, are generally not exempt from prior notification requirements due to national security concerns.
The List of Classifications of Listed Companies outlines core business sectors such as semiconductors and dual-use technologies, metal mining of significant mineral resources, cybersecurity-related services (e.g., network security monitoring and critical infrastructure protection), and telecommunications. Non-core business sectors include software, data processing services, and internet-use support businesses.
Coverage Horizontal

JAPAN

Since April 1959, last amended in May 2022

Pillar Intellectual Property Rights (IPRs)  |  Indicator Practical or legal restrictions related to the application process for patents
Patent Act (Act No. 121 of 1959) (昭和三十四年法律第百二十一号特許法)
According to Arts. 8 and 184-11 of the Patent Act, the appointment of an agent is required if the applicant is not resident in Japan. Such an agent must be a resident of Japan or a firm registered to practice before the Japan Patent Office. In addition, pursuant to the Art. 184-4, translation of international applications is required into Japanese.
Coverage Horizontal

JAPAN

Since June 1970, entry into force in October 1978

Pillar Intellectual Property Rights (IPRs)  |  Indicator Participation in the Patent Cooperation Treaty (PCT)
Patent Cooperation Treaty
Japan is a party to the Patent Cooperation Treaty (PCT).
Coverage Horizontal

JAPAN

Since May 1970, last amended in January 2022

Pillar Intellectual Property Rights (IPRs)  |  Indicator Copyright law with clear exceptions
Copyright Act (Act No. 48 of 1970) (著作権法(昭和四十五年法律第四十八号))
Japan has a copyright regime under the Copyright Act. However, the exceptions do not follow the fair use or fair dealing model, therefore limiting the lawful use of copyrighted work by others. Arts. 30-50 list the exceptions, which include which include quoting and thereby exploiting a work that has been made public. In such a case, the work must be cited consistent with fair practices and within a scope that is justified for the purpose of news reporting, critique, study, or another place in which the work is quoted; to broadcast or cablecast a work that has been made public, in broadcast or cablecast programming for schools that conforms to the curriculum standards provided for in laws and regulations on school education; among others.
Coverage Horizontal

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