The measures available to a creditor seeking to identify the assets of another party differ depending on whether a judgment in favour of the creditor has already been rendered.

Pre-judgment Measures

Registered assets

The ownership of certain types of properties is registered with the relevant authorities, but this information – although publicly available – can only be accessed in certain circumstances. Information on land parcels and buildings/houses (including the name of the owner), for example, is registered with the real property registry at the Legal Affairs Bureau and any person can access it by obtaining a copy of the registration.

However, while the real property registration can be accessed by specifying the address of the property, this information cannot be searched for using the name of the owner. Therefore, it is possible to find out who owns a specific piece of real property through this system, but not which real properties are owned by a specific person.

Requests for information via the Bar Association

A Japanese lawyer can request the disclosure of all documents and information necessary to collect evidence and conduct their investigations from any public or private organisation/entity via a relevant Bar Association, under the Lawyers Act.

Occasionally, the recipient of such a request will refuse to disclose the desired information, due to confidentiality obligations. Banks do not usually disclose any information concerning their customers, for example, unless the customer consents to the disclosure.

Provisional attachment order

Provisional attachment is a preliminary relief to secure the subsequent enforcement of an eventual monetary judgment by prohibiting the debtor from disposing of their assets.

The court will issue an ex parte provisional attachment order if a creditor can substantiate an underlying claim and demonstrate an imminent risk that the assets are likely to be disposed of before the judgment is enforced. However, provisional attachment is not a measure to search out the debtor’s assets; rather, the creditor must identify the assets to be preserved.

Exceptional circumstances in which provisional attachment may be used to find out the debtor’s assets include where receivables are owed to the debtor by a third party, who would then be required to confirm certain information regarding the receivables owed (such as the amount thereof). The creditor may be able to identify those specific receivables before initiating a lawsuit by virtue of this confirmation.

Post-judgment Measures

The judgment creditor can use the Civil Execution Act to obtain information concerning the judgment obligor’s assets once a monetary judgment in favour of the creditor becomes final and irrevocable, or comes with a declaration of provisional execution (see 2.1 Types of Domestic Judgments).

The Civil Execution Act allows a judgment creditor to request a court order compelling the judgment obligor to disclose their property if the creditor can demonstrate certain prescribed matters – for example, that they could not or would not collect money from the judgment obligor’s known assets. The judgment obligor’s failure to comply with the compelling order is punishable by up to six months in prison and/or fines of up to JPY500,000.

Moreover, a judgment creditor may request a court order against third parties in order to compel the disclosure of certain information regarding the judgment obligor’s assets. This includes information about bank deposits, listed stocks and government or corporate bonds from banks and other financial institutions. The judgment creditor may also collect information about real property owned by the judgment debtor from a relevant registry office.

Final Judgment

Japanese courts have the power to render three types of final judgment, which are outlined here, on the merits of the case in civil litigation.

Judgment for performance (kyufu hanketsu)

This is an ordinary type of judgment, in which the court orders the losing defendant to perform (or not to perform) certain acts, such as the payment of damages, repayment of loans, eviction from premises, delivery of goods and restitution.

The court may render a declaration of provisional execution, along with the judgment in favour of the plaintiff, in monetary judgments. In this case, the plaintiff is entitled to execute the judgment before it is finalised, even if the losing defendant appeals the judgment.

Declaratory judgment (kakunin hanketsu)

This type of judgment is a court declaration regarding rights and obligations and other legal relationships between the plaintiff and the defendant. A declaratory judgment is literally and merely a declaration and cannot be enforced. Thus, in many cases, the plaintiff should seek an ordinary judgment for the defendant’s performance.

Formative judgment (keisei hanketsu)

The purpose of this type of judgment is to create and form rights and obligations or legal relationships between the plaintiff and the defendant. Formative judgments are only available in a limited number of cases prescribed by law, such as the revocation of a shareholders' resolution made in a shareholders' meeting under the Companies Act.

Interlocutory Judgment

An interlocutory judgment may be rendered prior to the final judgment at the sole discretion of the court when an independent defence or other interlocutory dispute is considered ripe for decision. Unlike a summary judgment that is available in some other jurisdictions, an interlocutory judgment is not a final judgment on the merits of the case and therefore cannot be enforced.

Preliminary Relief

In order to preserve the debtor’s assets prior to initiating a lawsuit for a monetary claim, a creditor may seek the following preliminary reliefs ex parte:

• provisional attachment (kari sashiosae) – this is to prohibit the debtor from disposing of a specific piece of property for the purpose of preserving their assets; or
• provisional disposition (kari shobun) – this is to prohibit the debtor from disposing of property in dispute or exercising rights attached to it.

Pursuant to the Civil Execution Act, a final and irrevocable domestic judgment and a judgment with a declaration of provisional execution may be enforced by filing an authenticated copy of the judgment with the execution court or an execution officer, accompanied by a certificate of execution issued by the court clerk and a certificate verifying that the judgment has been served upon the judgment obligor.

The enforcement process differs depending on whether the judgment is for a monetary claim or a non-monetary claim, and depending on the type of assets involved.

For Monetary Claims

The judgment creditor may collect the judgment sum from any of the assets owned by the judgment debtor, apart from certain assets prescribed by law (including requisites for life and a certain portion of the debtor’s salary).

For receivables, the execution court issues an attachment order that prohibits a third-party debtor from repaying any part of the receivables to the judgment debtor. The judgment creditor may elect either to receive repayment from the third-party debtor or (if another creditor attaches the same receivables) to have the receivables assigned and transferred from the judgment debtor to the judgment creditor by another court order.

Real property and personal property are attached by a court order and auctioned off. The amount of the judgment sum is then paid to the judgment creditor from the sale proceeds.

For Non-monetary Claims

If the judgment is for the delivery of or eviction from real property, compulsory execution is carried out by an execution officer visiting the site and releasing the real property from the debtor’s possession. The execution officer typically makes a “demand for surrender” first, specifying the time limit for the delivery/eviction (which must be one month or longer). This is designed to encourage the judgment debtor to surrender the property by themselves on time.

“Movable” property is defined similarly to “personal property” or “chattel” in Anglo-American law. For the delivery thereof, an execution officer compulsorily and physically confiscates the movables from the judgment debtor and delivers them to the judgment creditor. A “demand for surrender” is not made for movable property.

Other performance by the judgment debtor may be carried out by way of third-party substitute. If the judgment debtor’s obligation is to refrain from doing a specific act, the execution court orders the judgment debtor to reverse the outcome of such actions at their own expense or take appropriate measures for the future. Should the nature of the obligation mean that such measures do not apply, the execution court may instead order the judgment debtor to pay the judgment creditor a certain sum of money if the judgment debtor fails to perform the judgment within a certain period.

The time and cost required for the compulsory execution of a judgment depend largely on the type of actions involved.

The attachment of receivables only requires a filing fee of JPY4,000 and postal costs. However, the attachment and public auction of real property requires:

• procedural costs of between JPY500,000 and JPY2 million, which are determined by each court of jurisdiction using a certain formula;
• registration and licence taxes amounting to 0.4% of the value of the real property;
• the filing fee of JPY4,000; and
• postal costs.

It typically only takes a couple of weeks to obtain a court order for the attachment of receivables. The attachment and public auction of real property takes more than a year, as a real estate appraiser needs to conduct an investigation and valuation of the property before the auction process can commence.

Owing to the time and cost of the procedures, attaching receivables is generally believed to be the most efficient way to enforce a judgment for a monetary claim.

There is no post-judgment procedure in Japan for determining what assets the defendant holds and where they are located. The judgment creditor must identify the assets held by the judgment debtor when filing for compulsory execution.

The judgment debtor cannot challenge the judgment itself to resist the enforcement thereof, whether based on the merits or on procedural issues, once the judgment becomes final and irrevocable.

The exception is a “retrial”, under the Code of Civil Procedure, based on limited prescribed grounds (eg, representation by an unauthorised attorney, false testimony, or forgery of evidence relied upon in the judgment). The execution court may, upon petition, issue an order to stay compulsory execution of the judgment pending such a retrial. A security deposit, the amount of which is determined by the court, may or may not be required.

Pursuant to the Civil Execution Act, a judgment debtor may also challenge enforcement of a finalised judgment by filing a separate action called “action to oppose execution” if it is based on grounds that occur after the hearing procedures for the judgment. Such grounds include repayment and satisfaction of the debt, set-off, and lapse of a ten-year period from the finalisation of the judgment. The execution court may, upon petition, issue an order to stay compulsory execution of the judgment pending such an action, with or without requiring a security deposit (the amount of which is determined by the court).

Finally, in the case of a judgment with a declaration of provisional execution, a judgment debtor may file a petition for a court order staying its enforcement if the defendant appeals the judgment.

Two of the three categories outlined in 2.1 Types of Domestic Judgments are not enforceable: declaratory judgments and formative judgments. As for judgment for performance, which occurs where the parties have agreed not to enforce, the court must declare in its judgment that the judgment is not enforceable.

There is no organised system in Japan to register judgments.

Japan is not a signatory to any international treaties or conventions for the enforcement of foreign judgments. However, Japanese law does prescribe that judgments rendered by foreign courts can be enforced in Japan if certain statutory prerequisites are met.

Judgment of Execution

Articles 22 and 24 of the Civil Execution Act establish the framework under which a foreign judgment may be enforced in Japan. Article 22 allows for a foreign judgment to be enforced if, among other things, it is a “judgment rendered by a foreign court ... accompanied by an irrevocable and final judgment of execution [shikko hanketsu]”.

A judgment of execution is a judgment issued by the Japanese court recognising and directing the enforcement of a foreign judgment. It is therefore necessary to first obtain a judgment of execution from a Japanese court before a foreign judgment can be enforced in Japan.

A party must file a lawsuit in a Japanese court to obtain a judgment of execution. Article 24 of the Civil Execution Act provides that a “judgment of execution shall be rendered without inquiring into the merits of the decision concerned” (paragraph 2) and a lawsuit seeking a judgment of execution “shall be dismissed when it cannot be demonstrated that the judgment of the foreign court has become final or when the foreign judgment does not meet the conditions enumerated under each item of Article 118 of the Code of Civil Procedure” (paragraph 3).

Prerequisites Under Article 118 of the Code of Civil Procedure

Article 118 of the Code of Civil Procedure outlines the prerequisites for a foreign judgment to be enforced in Japan directly in the following excerpt.

“The judgment of a court of a foreign country [that] has become final and conclusive shall be valid only when the following conditions have been met:

• the jurisdiction of the foreign court is recognised by law or treaty;
• the losing defendant duly received service of summons or other order necessary to commence the action, by means other than service by publication or any other service similar thereto, or voluntarily entered appearance in the proceedings;
• the contents of the judgment and the court proceedings are not contrary to the public order or good morals in Japan; and
• there is reciprocity.”

The litigant therefore needs to demonstrate that the judgment of the foreign court has become final and conclusive, and that the four prerequisites as stipulated by Article 118 of the Code of Civil Procedure have been met, in order for it to be enforced in Japan.

The approach to enforcing foreign judgments in Japan does not vary for different types of judgments.

In addition, foreign insolvency proceedings are recognised subject to certain prerequisites stipulated within the Act on Recognition of and Assistance for Foreign Insolvency Proceedings.

Lack of Finality/Judiciality

The first category of foreign judgments that will not be enforced in Japan are those that have not “become final and conclusive”. Accordingly, if the foreign judgment can still be appealed, it cannot be enforced in Japan. A foreign administrative decision/order is not enforceable either, as it is not a “judgment” of a “court” of a foreign country.

Lack of Jurisdiction

The second category consists of foreign judgments that do not meet the prerequisite set forth in Article 118, Item 1 of the Code of Civil Procedure, which states that “[t]he jurisdiction of the foreign court is recognised by law or treaty”. The “law” referred to, for the purpose of this provision, is Japanese law.

The Supreme Court of Japan Judgment of 24 April 2014 held that, under Japanese law, recognition of the jurisdiction of the foreign court is determined by:

• the rule of reason;
• applying the law of international jurisdiction under the Code of Civil Procedure of Japan; and
• considering whether or not it is appropriate for Japan to recognise the particular foreign judgment based on the specific circumstances of the case.

The jurisdiction of the foreign court in this context is called “indirect jurisdiction”.

Invalid Service

The third category relates to the prerequisite set forth in Article 118, Item 2 of the Code of Civil Procedure: “The losing defendant duly received service of summons or other order necessary to commence the action, by means other than service by publication or any other service similar thereto, or voluntarily entered appearance in the proceedings.”

Some other countries have treaties with Japan that require documents to be served in a certain manner for a lawsuit to commence. The Supreme Court of Japan has ruled that service must be conducted in accordance with the treaty’s requirement in order to be considered valid service for purposes of this prerequisite, under Item 2 of Article 118 (Supreme Court Judgment of 28 April 1998).

Whether service by direct postal mail is recognised as valid service under Article 118, Item 2 of the Code of Civil Procedure had long been an open issue, because the Japanese government did not lodge an objection under Article 10(a), which provides for the freedom to send judicial documents directly to persons abroad by postal channels, when it entered into the Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters of 1965 (the “Hague Service Convention”).

However, in December 2018 the Japanese government lodged an objection to Article 10(a) of the Hague Service Convention, meaning that service of process by direct postal mail is no longer permitted when serving Japanese defendants in lawsuits taking place in foreign countries. Accordingly, if a plaintiff filed suit in a signatory state of the Hague Service Convention against a Japanese defendant and served the Japanese defendant by direct postal mail, any default judgment delivered by the court of said foreign country will most likely be unenforceable in Japan. This is because the losing defendant would not be deemed to have “duly received service” under Article 118, Item 2 of the Code of Civil Procedure.

Public Order or Good Morals in Japan

The fourth category comprises foreign judgments that do not meet the prerequisite set forth in Article 118, Item 3 of the Code of Civil Procedure, which provides that “[t]he contents of the judgment and the court proceedings are not contrary to the public order or good morals in Japan”.

There is a precedent from the Supreme Court of Japan, for example, holding that part of a California court judgment ordering payment of punitive damages for the purpose of deterrence and sanction is against the public order of Japan and therefore not enforceable (Supreme Court Judgment of 11 July 1997). Parts of foreign judgments awarding punitive damages are thus potentially unenforceable in Japan in some cases, on the grounds that they are in violation of the public order.

Reciprocity

The fifth category of foreign judgments that will not be enforced in Japan are those delivered by courts in a country where there is no reciprocal treatment for the judgments of Japanese courts (Article 118, Item 4 of the Code of Civil Procedure).

Reciprocity in this context means a foreign court recognises the judgments of Japanese courts, under its domestic law, and does so upon conditions not substantially different from those stipulated by Article 118 of the Code of Civil Procedure (Supreme Court Judgment of 7 June 1983).

Several lower court judgments have found that there is no reciprocity for Japanese court judgments in the People’s Republic of China, but there have been judgments that recognised reciprocity between Japan and many other countries, including Australia, South Korea, Singapore, the UK, Germany, and US states such as Illinois, California, Minnesota, New York and Nevada.

A party that wishes to enforce a foreign judgment in Japan must file a lawsuit seeking a judgment of execution; in principle, this would be a district court with jurisdiction over the domicile of the judgment debtor (Article 24 of the Civil Execution Act).

If no challenges are raised on any of the grounds listed in Article 118 of the Code of Civil Procedure, the court will render a directly enforceable judgment. Should the defendant raise any objections on those grounds, the case proceeds like any other normal lawsuit. However, in a lawsuit seeking a judgment of execution, a court decision is often made mainly based on documents submitted by the parties (ie, legal briefs and written evidence). Witness examination is usually not necessary.

If the court finds that the prerequisites set forth in Article 118 of the Code of Civil Procedure are met, it delivers a judgment of execution that allows the plaintiff to enforce the foreign judgment. The court may issue a judgment of execution with respect to only part of the foreign judgment.

As is the case with any other lawsuit, where a district court judgment has been granted or denied a judgment of execution, the losing party may file an appeal to a high court. A final appeal to the Supreme Court may then be filed by the losing party following the high court proceedings.

The plaintiff can proceed to enforcement of a foreign judgment once a judgment of execution becomes final and irrevocable. The process thereafter is the same as enforcing domestic judgments.

The time and costs necessary to enforce foreign judgments depend on the circumstances of each case. Upon filing a lawsuit requiring a judgment of execution, a plaintiff must pay advance filing fees – the amount of which is largely proportional to the amount being claimed.

Attorneys' fees are generally borne by the respective parties regardless of the outcome of the case; in other words, the successful party’s legal fees are not covered by the losing party.

There is no published statistical data regarding how long a lawsuit seeking a judgment of execution normally takes. It typically takes around six months to two years from the filing of a lawsuit until a judgment is rendered by a district court. Appellate proceedings usually take about another six months to one year.

Once a judgment of execution becomes final and irrevocable, a winning plaintiff may enforce a foreign judgment. The time required for compulsory execution is the same as enforcement of a domestic judgment.

The court reviews whether or not the foreign judgment in question meets the prerequisites set forth in Article 118 of the Code of Civil Procedure in lawsuits seeking a judgment of execution. Accordingly, the defendant in a foreign judgment may challenge the enforcement thereof on the grounds that it does not meet those prerequisites.

Broadly speaking, a defendant challenging enforcement would usually cite the following elements of a foreign judgment:

• lack of finality/judiciality;
• lack of “indirect jurisdiction”;
• invalid service;
• contravention of the public order or good morals in Japan; and/or
• lack of reciprocity.

As well as the above-mentioned grounds, a defendant may be able to raise a defence that has emerged following the rendering of the foreign judgment. If a defendant has made a payment to the plaintiff in accordance with a final and conclusive foreign judgment ordering them to do so, for instance, then the defendant may assert in a lawsuit seeking a judgment of execution that the foreign judgment has already been fulfilled.

Domestic and foreign awards are deemed to have the same legal effects as a final and irrevocable court judgment in Japan, as per Article 45(1) of the Arbitration Act of Japan (Act No 138 of 2003), and can be enforced after obtaining an enforcement decision from a Japanese court (Article 46 of the Arbitration Act). A party seeking enforcement of an arbitral award may petition a court for an enforcement decision.

Japan acceded to the New York Convention on 20 June 1961, which became effective in Japan from 18 September 1961, with a reservation of reciprocity. Foreign awards rendered in countries or regions that are not signatories to the New York Convention, such as Taiwan, can be enforced according to Article 46 of the Arbitration Act.

The grounds for refusing to recognise or enforce domestic and foreign awards are effectively the same as those outlined in Article 36(1) of the 2006 UNCITRAL Model Law on International Commercial Arbitration (the “Model Law”) or Article V of the New York Convention. These recognition and enforcement rules apply even if an award is rendered in a country or region that has not signed or ratified the New York Convention. The seat of the arbitration is not an issue when recognising and enforcing awards in Japan in that sense.

Japanese courts are generally considered pro-arbitration and view the recognition and enforcement of awards in a favourable light.

Japanese law does not distinguish between different types of arbitral awards, and thus the provisions relating to enforcement are applicable regardless of the nature of the award.

Similar to a lawsuit, upon the petition of a party, an arbitral tribunal may order interim measures that it considers necessary in respect of the subject matters of the dispute in order to ensure the effectiveness of the arbitral award. The recent amendments to the Arbitration Act have specified the different types of interim measures that are available and have enabled enforcement of the interim measures.

Provisions relating to the enforcement of arbitral awards are applicable regardless of the nature of the award, as Japanese law does not distinguish between different categories of arbitral awards (see 4.2 Variations in Approach to Enforcement of Arbitral Awards).

A party seeking enforcement of an arbitral award should apply to a court for an enforcement decision. The grounds for refusing to recognise or enforce arbitral awards are essentially the same as those of Article 36(1) of the Model Law or Article V of the New York Convention (see 4.1 Legal Issues Concerning Enforcement of Arbitral Awards).

A party must generally file a petition with the court for an enforcement decision to enforce an award that has been issued by an arbitral tribunal but has not been performed voluntarily. When the enforcement decision becomes final and irrevocable, it can be used for compulsory enforcement with the assistance of a judicial authority.

Under the Arbitration Act, the party seeking the enforcement decision is required to submit a duly certified copy of the arbitral award, including a Japanese translation if the award is written in a foreign language. In this regard, the recent amendments to the Arbitration Act ease the translation requirement for an arbitral award written in non-Japanese languages. The amended Arbitration Act stipulates that, in procedures for the enforcement of an arbitral award, if the court finds it appropriate, the court may omit the translation requirement after hearing the opinions of the parties.

The procedure for enforcement decisions has been simplified. Although the court must give both parties an opportunity to be heard, a formal oral hearing is no longer required.

The enforcement decision is subject to appeal, which must be filed within two weeks of the date on which the order is served on the appellant.

The time and total costs required for enforcing arbitral awards differ largely depending on the circumstances of each case.

An application for an enforcement decision requires filing a fee of JPY4,000 and postal costs. According to statistics from the Tokyo District Court, about half of all petitions for an enforcement decision between 2004 and 2016 were completed within six months, and 75% were completed within one year at the court of first instance.

The grounds for refusing to recognise or enforce domestic and foreign awards are essentially the same as those of Article 36(1) of the Model Law or Article V of the New York Convention (see 4.1 Legal Issues Concerning Enforcement of Arbitral Awards).