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Japan's System of Trade Control System
2020-03-05

[Japan's System of Trade Control System]

 

 

 

Outline

 

Japan's trade control Acts are largely classified into 3 categories, the customs-related Acts, other Acts and the Acts related to other regulations for domestic sales.

 

There is no doubt that the customs-related Acts, among them, have direct influence on trade regulations.

 

However, in reality, other Acts except for customs-related Acts and domestic laws prescribing various regulations on domestic sales also have direct and indirect influence over the import and export of Japan.

 

 

Customs-Related Acts

 

Customs-related Acts in Japan refer to the following three Acts and its subordinate statutes.

 

1) The Customs Act

 

The Customs Act prescribes basic matters of customs administration such as dutiable goods, taxpayers, payment methods of tax, customs clearance, bonded area, etc.

2) The Customs Tariff Act

 

The Customs Tariff Act prescribes determinating methods of dutiable value, kinds of tariff rates, conditional or unconditional reduction and exemption of customs duties system, etc.

 

3) Act on Temporary Measures concerning Customs

 

This Act prescribes aircraft parts exemption, emergency tariff, preferential tariff, Rule of Origin, etc.

 

 

Other Acts

 

The term, "Other Acts" sounds very ambiguous but it's called commonly in Japan.

Generally, the Other Acts refer to the Acts which directly define trade relationships in terms of permit, approval, etc. as the Acts other than Customs-related Acts.

 

Article 70 of The Customs Act of Japan

 

Article 70

 

1. The articles which require permit or approval of export or import in accordance with the provisions of Other Acts, and measures of other administrative agencies or its equivalent measures(hereinafter referred to as "permit, approval, etc.) shall verify to the Customs that the relevant articles obtained permit, approval, etc. at the time of declaring export or import.

 

2. The articles which require inspection on export or import, or the compliance of requirements in accordance with the provisions of Other Acts shall verify to and obtain a confirmation from the Customs that such articles have completed inspections or has complied with requirements as prescribed by the relevant Acts, when the Customs conducts inspection(export or import permit) under Article 67, and other audit for export or import declaration.

 

3. The articles which fail to verify Paragraph 1, or fail to confirm all above Paragraphs shall not be granted export or import permit.

 

 

Other Acts are classified into the Foreign Exchange and Foreign Trade Act, and other permit and approval related Acts.

 

 

Customs Regulations 1 - The Foreign Exchange and Foreign Trade Act

 

This Act defines the foundation of foreign trade control of Japan, equivalent to the Foreign Trade Act of other nations.

 

Its subordinate statutes contain Export Trade Control Order(hereinafter referred to as "Export Order") and Import Trade Control Order(hereinafter referred to as "Import Order") which practically play very significant roles in foreign trade management in Japan. The matters concerning trade regulations are under the authority of the Ministry of Economy, Trade and Industry.

 

1) Export Order

 

Permit : Under the Export Order, the export of weapons such as military cargo, weapons of mass destruction, military confidential goods, etc. to foreign countries requires the permit from the Minister of Economy, Trade and Industry in advance, which has 6 months of validity term.

 

Approval : Under the Export Order, the permit from the Minister of Economy, Trade and Industry in advance is required for rough diamonds, fuel supplies, boats, etc. which are specified in Appended Table 2 of Export Order, and raw materials under commissioned processing trade contract, cargos bound to the North Korea, etc. The term of validity of such approval is 6 months, in principle.

 

2) Import Order

 

Import Order has Import Trade Control Ordinance and Import Public Announcement under it. Meanwhile, Public Announcement provides information regarding following five detailed import controls methods and items of goods subject to such regulations.

 

Among the following systems, Import Quota, Item (ii) approval, Item (ii)-2 approval are subject to practical regulations to directly regulate import itself. On the contrary, Pre-Confirmation and Confirmation at Customs Clearance System are subject to procedural regulations to make the relevant goods go through certain procedures to monitor import status, not regulating import itself.

 

Import Quota (IQ Items - non-liberalized items)

The term, Import Quota means the items designated in item (i) of Import Public Announcement, which defines permissible import quantity to Japan, and requires the approval from the Minister of Economy, Trade and Industry for such import. Items subject to Import Quota in Import Public Announcement cover seafood, marine products, etc. and the substances included in the Montreal Protocol on Substances that Deplete the Ozone Layer.

 

Item (ii) approval

The term, Item (ii) approval means the items designated in item (ii) of Import Public Announcement, which requires the permit of the Minister of Economy, Trade and Industry for import to Japan. The items subject to Item (ii) approval aren't applied to all of nations but specific cargos imported from specific nations or regions, which is different from Item (ii)-2 approval.

 

Item (ii)-2 approval

The term, Item (ii)-2 approval means the items designated by Item (ii)-2 of Public Announcement, which requires the permit of the Minister of Economy, Trade and Industry for import to Japan. The items subject to Item (ii)-2 approval cover specific items from all of nations imported into Japan(that is, applied regardless of export regions), which is fundamentally different from Item (ii) approval.

 

Pre-Confirmation

The items cover those designated by items (iii) of Import Public Announcement, which don't require import approval in terms of simplified procedure, but require pre-confirmation from the Minister of Economy, Trade and Industry for the import to Japan. Applicable items include fish, frozen tuna, experimental DDT, etc.

 

Confirmation at Customs Clearance

The items also cover those designated by Public Announcement, items (iii), which don't require pre-confirmation from the Minister of Economy, Trade and Industry for the import to Japan but needs to submit required documents such as a permit, etc. to the customs. Applicable items include radioactive isotopes, pesticides, etc.

 

3) Special measures of import controls - unnecessary for Quota and Approval

 

Even the items requiring Import Quota and approval don't require Import Quota and approval of the competent agency in special cases where conformed to the aims of quota or approval(Import Order, the appended Table 1). Significant items from among are as below.

 

Products free of charge below ¥ 180,000 from among the goods subject to Import Quota

Free of charge relief goods, samples, commercial goods, non-commercial goods for personal use

Vessel articles, aircraft articles, articles for diplomats, complimentary record documents, religious items, etc.

Marine products caught in the foreign waters by Japanese vessels, carny entertaining tools, etc.

International tournament squad belongings, athletic equipment

ATA Carne cargo

Belongings of temporary immigration, employment equipment

Family-moving cargo of immigrant to Japan for permanent residence

Other cargos temporarily landed in bonded area, etc.

 

Regardless of above special measures, the original Quota and approval are required for specific foreign cultural properties, specific substances, diamonds, the cargo included in Washington Convention, regulatory substances included in the Montreal Protocol on Substances that Deplete the Ozone Layer, nuclear materials, wastes, etc.

 

 

Customs regulations 2 - Regulations by other permit and approval Acts

 

Other Acts than Foreign Exchange and Foreign Trade Act also provide direct import and export controls, which currently cover 10 Acts in export, 27 Acts in import.

Other governmental institutions in charge of permit and approval are the Ministry of Health, Labour and Welfare, the Ministry of Environment, the Ministry of Agriculture, Forestry and Fisheries, etc. Other institutions than the Ministry of Economy, Trade and Industry also are getting involved in trade regulations concerning the competent Acts.

 

The items under other permit and approval-related Acts(Other Acts) may not allowed for going through the import and export customs if not furnished with the requirements such as the permit, approval, registration, etc. of the competent institutions, which means they're basically under the direct regulations on trade.

 

 

Sales Regulations - Regulations for Domestic Sales and Distribution

 

The imported items mostly aim to be sold and distributed in Japan. However, there are the cases where specific items are freed to be imported to Japan without the restrictions of their entry, but face regulations and restrictions by domestic laws when they're try to sell them in domestic. Under that circumstance, such importer can't achieve the original purpose, which means, in fact, he/she is under the regulations on trade.(Indirect regulation)

 

Such Acts cover the Household Goods Quality Labeling Act, the Electrical Appliances and Materials Safety Act, the Consumer Products Safety Act, etc. which amount to approximately 40 items.

 

 

Notes

 

The TCS program has made efforts to digitalize all above-mentioned trade management system in Japan. Accordingly, you don't have to make an effort to search for immense information about trade management system in Japan, but you can just utilize simulation on this program to get guidance on regulations, requirements, etc. of your handling items.