Government measures in key jurisdictions 4th edition - Flipbook - Page 83
Japan
Contractual
Issues
Execution of Contracts
•
It is common in Japan for companies to execute contracts by signing and/or affixing a company
stamp on paper documents. In many cases, even before Covid-19, contract parties sometimes (i)
executed agreements separately and then exchanged PDF copies on the contract date, and then (ii)
sent the originals to be combined as a single agreement. This approach is legally effective and
would be helpful in the Covid-19 situation.
•
On 19 June 2020, the government issued a Q&A about contracts without a stamp on paper
documents, which suggests that certain approaches including (i) keeping email exchange records,
(ii) keeping a counterparty’s KYC information (if it is a new counterparty) and (iii) using electronic
signatures or electronic authorisation services would be helpful as evidence of the execution of
contracts.
•
An electronic contract with electronic signatures without any paper-based documents is also
permitted under Japanese law, save for certain exceptions, such as individual guarantees for a
third-party business. The Covid-19 pandemic should encourage the greater use of electronic
contracts by Japanese companies. On 17 July 2020, the government issued a Q&A about electronic
signatures to facilitate the use of electronic contracts.
What measures
have been taken
to reinforce
contracts?
Force Majeure
•
For a summary of issues on force majeure and frustration in the context Covid-19, please visit
our website here.
Subcontractors
Property
•
On 10 March 2020, the Ministry of Economy, Trade and Industry (“METI”) announced it
had requested companies to take special care in transactions with mid- or smallsize subcontractors (see more here), including (i) refraining from actions delaying
supplies to them, (ii) bearing appropriate increased costs derived from price increases
in raw materials and/or extra work of subcontractors, (iii) making payments on their
due date, and (iv) refraining from cancelling or changing purchase orders.
•
The Antimonopoly Act and Subcontractors Act also
prohibit certain unfair trade practices and would still apply anyhow.
•
As of 31 August 2020, there have been no changes to the laws that legally allow tenants to defer
rent payments. On 31 March, the Ministry of Land, Infrastructure, Transport and Tourism
(“MLIT”) requested landlords for commercial rents to accept a deferral of rent payments by
tenants who have difficulty paying rent due to the Covid-19 situation. On 17 April, the MLIT
also announced that it would extend a one-year grace period for the payment of taxes and social
insurance contributions by building owners for commercial rents who agreed to defer or cancel
rent payments.
•
On 14 July 2020, the government announced an office rent subsidy program for self-employed
individuals and small and medium enterprises (“SME”) with a capital of less than JPY 1 billion and,
for which sales income during 1 May to 31 December had decreased by 50% or more from the
same month of the previous year or by 30 % or more in a total of successive three months from
the same period of the previous year. The maximum amount of the subsidy is JPY 6 million for
SMEs and JPY 3 million for self-employed individuals.
Have any changes
been made to
the laws around
property, rent and
enforcement?
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Government measures in key jurisdictions