New Japanese Regulation on Telecomunications Businesses Provided by Foreign Business Operators

Authors: Attorney-at-Law Makoto Hibi
Attorney-at-Law Hidenori Shibata
July 2021

The Telecommunications Business Act of Japan (the “Act) provides a regulatory framework for telecommunications businesses. Recently, the number of platform services and other telecommunication services provided by foreign entities has greatly increased in Japan. As the number of these services continues to grow, massive data breaches and communication failures have occurred in the services provided by some foreign entities. Through these cases, it became clear that the domestic users of such services were not being protected appropriately and that a level playing field for domestic and foreign telecommunication business providers was not secured in Japan. The amendment to the Act came into effect on 1 April 2021, aiming to protect domestic users and secure fair competition by enhancing the enforcement of the Act against foreign entities, and the Japanese regulatory authority, the Ministry of Internal Affairs and Communications (the “MIC”), published a set of guidelines (the “MIC Guidelines”) which are aligned with the purpose of this amendment.

Based on the MIC Guidelines, even foreign entities which have no telecommunication facilities in Japan are subject to regulation if they have certain nexuses with Japan. In this Newsletter, we will provide an outline of the regulations that the amended Act places on foreign entities, and corresponding solutions.

  1. What kind of businesses are regulated?
  2. In what circumstances are foreign entities regulated?
  3. What are the regulatory requirements for foreign entities?

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