Column

Rule for converting employment contracts from fixed-term to indefinite-term

By Nobuhiro Kotou

Last month several major news reports were published regarding labour laws, including reports that the Japanese Trade Union Confederation (Rengo) had approved (and later retracted their approval of) the “highly-skilled professional system” (also reported as the “zero overtime pay system”) that excludes certain high-earning professionals from being subject to regulations regarding work hours, including the payment of overtime, as well as reports that the Ministry of Health, Labour and Welfare had issued warnings regarding illegal overtime to approximately 10,000 workplaces during the 2016 fiscal year. Yet, an event that will likely see reporting of much greater impact around April of next year is the “rule for converting labour contracts from fixed-term to indefinite-term” (i.e. the “indefinite-term conversion rule”) coming into practical effect.

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10 Major Revisions to the Japanese Civil Code
Part Three – Defects in Purchased Goods

By Shinya Yoshida and Peter Cassidy

This part of our series on revisions to Japan’s Civil Code will discuss what happens when there’s a problem in goods that are delivered under a contract of sale. The revised Civil Code contains major changes to interpretations and several major revisions to the law concerning sales contracts. The main feature is that under the revised Code, if there is a problem with the type, quality or quantity of the subject matter, the buyer’s options are no longer limited to compensation for damages or cancellation of the contract. Instead, it will be also possible to make a claim for a reduction of the purchase price or “subsequent completion” (i.e. repair or delivery of a replacement), regardless of whether the subject matter is an “identified good” or “unidentified good”.

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10 Major Revisions to the Japanese Civil Code
Part Two – Extinguishment of claims

By Shinya Yoshida and Peter Cassidy

   This second part of a series on recently enacted changes to the Japanese Civil Code will look at the extinguishment of claims. The term “extinctive prescription” is often used in English translations of the Code. It describes the civil law’s way of extinguishing a claim after a certain period of time has passed. Other terms used to describe this that readers may be more familiar with include “limitation periods”, “statute of limitations” or “time bars”. Currently, Japan’s Civil Code defines a basic extinctive prescription period of 10 years, but there are a variety of specific provisions applicable to various types of claims that define shorter periods of 1, 2 or 3 years. On top of this, claims related to commercial transactions between businesses are subject to a 5-year extinctive prescription period pursuant to the Commercial Code. The revised Civil Code rearranges these various extinctive prescription periods into two categories and repeals the shorter periods.

   Despite these changes, there has been no change to the basic principles that a claim can still be made after the extinctive prescription period has expired until such time that the debtor invokes the prescription, and that a debtor who acknowledges a debt without invoking extinctive prescription becomes unable to invoke it later. In other words, the expiry of the extinctive prescription period does not automatically extinguish a claim so the debtor must actively invoke the prescription. The ability to set off one debt against a claim that has already passed the extinctive prescription deadline has not been addressed in the revision, so the ability continues to exist. Read the rest of this entry >

10 Major Revisions to the Japanese Civil Code
Part One – Standard Terms and Conditions

By Shinya Yoshida and Peter Cassidy

On Friday, 26 May 2017, a bill to amend the portions of Japan’s Civil Code relating to claims passed the National Diet. This is the first major change to this area of the Code since it was first enacted in 1896, more than 120 years ago. The aim of this large-scale revision, which includes more than 200 revisions, is to update the Code for modern society, as there are many aspects of current society that are not dealt with in the current Code, such as Internet shopping and mobile phone contracts. Although the number of revisions is large, most are intended to codify principles that have already been confirmed in judicial precedents and academic writing. As the revision act was promulgated on 2 June, the revisions will take effect sometime before June 2020.

Despite the scale and importance of the revision, there seems to be a lack of commentary regarding the revisions in English. These changes are not only important for individuals and businesses located in Japan, but they may also affect the rights and obligations of companies that have trading relationships with Japanese companies. This series of columns will introduce ten areas of revision that are especially important. This first column will look at the new rules regarding the use of standard terms and conditions. The subsequent columns will discuss extinctive prescription periods, statutory interest rates and damages for late payment, cancellation of contracts, set-off of property damage claims, guarantees, contracts for work, e.g. construction, sales contracts, mistakes in contracts, and leases.
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Regional Brand Protection and the Geographical Indication System

By Takafumi Mise

Introduction

“Tajima Beef”, “Kobe Beef”, “Yubari King Melon”, “Shimonoseki Fuku”, “Iyo Silk”… these are regional products that Japan can be proud of. Also, each of these products are currently registered under the Geographical Indication (GI) system. In this column I will discuss Japan’s GI system and its legal merits within Japan.   Read the rest of this entry >