Are e-signatures legal, admissible, and enforceable in Japan?
- Act on Electronic Signatures and Certification Business (「電子署名法」, or Denshi-Shomeihou) (Act No. 102 of May 31, 2000, hereafter referred to as the "Act"), under which the validity of e-signature is recognized in the same way as that of a “wet” signature or a "seal (hanko)" (Japanese traditional way of certification)
Are there certain documents that cannot be e-signed in Japan?
Below are examples of the documents/contracts relevant to a business and for which e-signatures cannot be used:
- Statements of important matters for real estate transactions (under Articles 34-2, 35 and 37 of Real Estate Brokerage Act);
- Fixed term land/ building lease agreements for business purposes (under Articles 22, 38 and 37 of the Act on Land and Building Leases);
- Condominium management service agreements, etc. (under Article 73 of Act on Advancement of Proper Condominium Management);
- Documents of contracts, etc., before and after the Agreement in Provision of Specified Continuous Services, etc., (under Articles 2 and 42, etc., of Act on Specified Commercial Transaction), and
- Cooling-off letter for financial instruments (under Article 37-6 of Financial Instruments and Exchange Act).
Apart from the commercial documents listed above, wills cannot be executed electronically, so e-signatures are not allowed (under Articles 960, etc. of Civil Code).
Does local regulation govern the use of digital IDs and/or certificates for e-signatures in Japan?
In Japan, there are no laws or regulations that specifically mention digital IDs, while certifications are often used by enterprises in practice in order to prove the fulfilment of the requirements for valid e-signatures.
Under the Act, an electronic signature is presumed to be valid and authentic if it fulfills the following requirements:
(i) The electronic signature on the document was performed by the signor; and
(ii) The electronic signature could have been used by no one but the person himself (through the appropriate management of codes and practices).
Further, the Act provides that electronic signatures are presumed valid if such electronic signatures can only be performed by the principal through "appropriate management of codes and properties necessary for the principal to perform an electronic signature." Here, a typical method is to use public key cryptography, but the Act and its related guidelines do not exclude other methods.
Electronic certificates issued by a Certificate Authority (CA) or an Accredited Certificate Authority (ACA) are commonly used by Japanese companies to prove that the requirements above have been fulfilled. ACAs obtain their authorization pursuant to the Act and, accordingly, the services they provide are regulated and are required to be secure.
Notwithstanding the difference between CA and ACA in their regulatory position, certificates issued by CAs are also valid under the Act, and therefore, electronically executed copies certified by CAs are considered to have equal validity to wet signatures/seals affixed to documents executed in hard copy form.
Please also refer to the answer in question 4 below.
Does local law provide certification bodies / trust services that users of e-signatures should be aware of in Japan?
There are service providers which have been accredited under the Act to meet the requirement stated above in question 3 above (i.e., ACA). However, as stated above, it does not mean that electronic signatures supported by other service providers do not meet this requirement.
A list of accredited service providers (10 entities are accredited as of today) can be found on the website of Ministry of Economy, Trade, and Industry (only in Japanese).
*DISCLAIMER: The information contained in this guide is for information purposes only, provided as is as of the date of publication and should not be relied upon as legal advice or to determine how the law applies to your business or organization. It is recommended that you seek guidance from your legal counsel with regard to law applying specifically to your business or organization and how to ensure compliance. OneSpan does not accept liability for the contents of these materials or for third parties materials.
Last updated: November 2020