Electronic Signature Laws & Regulations - Japan

Electronic signatures are most commonly used in Japan for business-to-business (B2B) transactions. Some companies are also using electronic signatures in general business contracts. In Japan, the key legislation governing electronic signatures is the Act on Electronic Signatures and Certification Business (Act No. 102 of May 31, 2000) (“The E-Signature Act”). The E-Signature Act defines an “Electronic Signature” as a measure taken with respect to digital data in order to:

1. indicate that such data was created by the signatory, and
2. verify whether or not such data has been altered.

To be valid under the E-Signature Act, an electronic signature must also fulfill the following requirements:

1. It can be performed only by the principal through appropriate management of codes and properties necessary to perform such a measure.
2. It must be performed by the principal with respect to information recorded in an electromagnetic record in order to express information (i.e. the signatory’s intention).

Electronic signatures which meet the definition set out in the E-Signature Act have the same presumption of enforceability/admissibility as a “wet” signature.

Japanese law does not distinguish certificate-based digital signatures from electronic signatures in terms of enforceability/admissibility. The E-Signature Act does, however, stipulate the requirements for Specified Authentication Services, including authentication by Public Key Infrastructure and authorized providers of Specified Authentication Services, which form the basis of digital signatures.

Certificate-based digital signatures are primarily used for e-filing documents with government departments. Most government e-filing systems require authentication by the Japanese Public Key Infrastructure (“JPKI”) or by an Authorized Service Provider. A list of the Specified Authentication Services and Authorized Service Providers (in Japanese) published by the Ministry of Economy, Trade and Industry can be found at: (https://www.meti.go.jp/policy/netsecurity/esig-srvlist.html).

The laws around electronic signatures are generally understood by Japanese courts and judges because the rules of authenticity are clearly stipulated in the E-Signature Act.

Special considerations

Transacting with public sector entities

Additional requirements to use electronic signatures are set by individual government departments and agencies on a case-by-case basis. Most government entities require authentication by the JPKI or by an Authorized Service Provider which can provide mutual authentication between JPKI. This means that most of the e-filing such as commercial registration, real property registration and tax filing requires limited types of certificate-based digital signatures.

Use cases that generally require a traditional signature

In Japan, there are several use cases that generally require a traditional “wet” signature. Electronic signatures or documents cannot generally be used for documents or agreements that require notarization or handwritten signatures.

Specific examples include:

• Notarial Deed – Some documents, including notarized wills, voluntary guardianship contracts and agreements for establishing fixed term land leasehold for business purposes are required to be notarial deeds under Japanese law. Because notarial deeds must be in writing, electronic signatures cannot be used.
• Documents required to be in writing – Documents including, without limitation, fixed term land/building lease agreements, brokerage agreements with respect to purchase of real property, the “statement of disclosure of material matters” in respect of real property transactions, and wills (by holograph or sealed and notarized documents) must be in writing pursuant to the applicable laws and regulations.

In addition, some processes cannot be replicated electronically. For example, the process of establishing notarial deeds, disclosure of material matters in respect of real property transactions, and the delivery of the “statement of important matters” in respect of door-to-door sales cannot be replicated electronically.

In addition, under Japanese law, the terms “written” and “in-writing” do not include electronic data unless the law or regulation specifically stipulates that such terms include “electromagnetic record”. Therefore, it is generally said that if the laws or regulations require a “written” signed document, especially in administrative procedures, use of electronic signatures would not be allowed.