What laws govern contracts in Japan?

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Japan does not have a separate code of law for contracts to determine what laws govern contracts in Japan. Instead, contract law is governed by various laws contained in the Civil Code, the law of torts, the law of property, the law of succession and family law. While these codes contain the basic rules governing contract formation and execution in Japan, special rules relating to contracts between merchants are contained in the Commercial Code. Furthermore there are many other laws relating to protection of consumers and regulation of business operators.

The Japanese Civil Code clearly identifies 13 types of contracts: Gifts, Sale, Redemption, Exchange, Loans for Consumption, Loans for Use, Leases, Employment, Contracts for Work, Mandates, Deposits, Partnerships, Life Annuities and Settlements. These categories provide specific rules to be followed for each type of contract but in many cases it can be difficult to determine which category a specific contract falls under.

This complexity makes it critical that you always consult with a lawyer before signing any type of contract. If you have any questions about what laws govern contracts in Japan or contracting in Japan in general, please contact our office to set up a legal consultation with one of our lawyers.