Japan's Specified Commercial Transactions Act: What Online Sellers Must Know

If you sell anything online in Japan — whether through your own website, Amazon Japan, Rakuten, or even social media — you must comply with the Specified Commercial Transactions Act (特定商取引法, commonly called Tokusho-hou). This law is Japan's primary consumer protection regulation for commercial transactions, and ignorance is not a defense.

What Is the Specified Commercial Transactions Act?

The Tokusho-hou regulates six types of commercial transactions to protect consumers from unfair business practices:

Transaction Type	Japanese Term	Examples
Mail-order/Online sales	通信販売	E-commerce, catalog sales
Door-to-door sales	訪問販売	In-home product demonstrations
Telemarketing	電話勧誘販売	Phone solicitation
Multi-level marketing	連鎖販売取引	MLM, network marketing
Specified continuous services	特定継続的役務提供	Beauty salons, tutoring
Business opportunity schemes	業務提供誘引販売	Home-working schemes

For online sellers, the mail-order sales (通信販売) category is most relevant.

Mandatory Disclosures for Online Sellers

Every online seller must display the following information on their website, typically on a dedicated "Specified Commercial Transactions Act" page:

Required Information

Item	Details
Business name	Company name or individual's legal name
Address	Full physical address (no P.O. boxes)
Phone number	Contact phone number
Representative name	Name of the person in charge
Product price	Including tax (消費税 inclusive)
Shipping costs	Flat rate, calculated, or free
Payment methods	Credit card, bank transfer, etc.
Payment timing	At order, upon delivery, etc.
Delivery timeline	Within X business days of order
Return/cancellation policy	Conditions, deadlines, who pays return shipping
Software operating environment	If applicable

Important: Even solo entrepreneurs and side-business owners must display their real name and address. Operating anonymously is not permitted under this law.

The 2022 Reform: Final Confirmation Screen Rules

A major reform took effect in June 2022, adding strict requirements for the final confirmation screen (最終確認画面) — the last page customers see before placing an order.

What Must Appear on the Final Confirmation Screen

• Product quantity and description
• Total price (tax included)
• Payment method
• Payment timing
• Delivery timeline
• Offer period (for limited-time sales)
• Cancellation and return conditions

For subscription services and recurring purchases, additional requirements apply:

1. Clear statement that it's a recurring purchase
2. Price for each installment
3. Total payment amount
4. Contract duration
5. Cancellation conditions and process

Common Violations

Violation	Consequence
No return policy on final screen	Administrative action by Consumer Affairs Agency
Disguising subscriptions as "free trials"	Business suspension order
Hiding address or phone number	Warning then business suspension
Misleadingly small cancellation terms	Treated as deceptive display

Penalties for Non-Compliance

The penalties are surprisingly severe:

Violation	Penalty
False statements, omitting material facts	Up to 3 years imprisonment or 3 million yen fine
Corporate violations	Up to 100 million yen fine
Violating business suspension orders	Up to 3 years imprisonment or 3 million yen fine
Administrative orders	Public disclosure of business name

The Consumer Affairs Agency (消費者庁) actively enforces these rules, issuing multiple administrative actions each year.

Practical Steps for Compliance

1. Create a Proper Disclosure Page

Set up a dedicated page titled "特定商取引法に基づく表記" (Notation Based on the Specified Commercial Transactions Act) accessible from your website's footer. Include every required item.

2. Define Your Return Policy

Unlike door-to-door sales, mail-order sales don't have a cooling-off period. Instead, you must clearly define a return policy (返品特約). Without one, you're legally obligated to accept returns within 8 days of delivery.

3. Secure Document Sharing with Partners

When sharing business registration documents, contracts, or compliance records with business partners, avoid sending them as plain email attachments. Services like LOCK.PUB let you share documents through password-protected links with expiration dates, ensuring sensitive business information stays secure.

4. Subscription Display Compliance

The "first month free" or "trial for just 500 yen" model has come under intense scrutiny. Make sure your final confirmation screen clearly shows the full subscription terms, total cost, and cancellation process.

Who's Affected?

This law applies more broadly than many realize:

• Amazon/Rakuten sellers: Must complete marketplace-provided disclosure forms
• Shopify/BASE/STORES sellers: Must create their own disclosure page
• Social media sellers: Even selling via Instagram DMs or iMessage carries the same legal obligations
• Digital product sellers: E-books, courses, and SaaS products are included
• Freelancers selling services: If you repeatedly offer services online

Filing Complaints and Getting Help

Consumers can report violations through Japan's Consumer Hotline at 188. Business owners can also use this line to ask compliance questions.

Compliance Checklist

Requirement	Status
Disclosure page created	☐
All mandatory items listed	☐
Final confirmation screen compliant	☐
Return policy clearly stated	☐
Subscription terms properly displayed	☐
Business documents securely stored/shared	☐

Understanding and complying with the Tokusho-hou isn't just about avoiding penalties — it builds consumer trust and strengthens your business reputation. For securely sharing compliance documents or business registration details with partners, consider using LOCK.PUB to create password-protected, expiring links.