Japan
Shipowner Eligibility
Japanese ships are defined as any of:
• Ships owned by the Japanese Government or a Japanese public office
• Ships owned by Japanese nationals
• Ships owned by companies established by Japanese laws, of which all of the representatives and two-third or more of the directors are Japanese nationals
• Ships owned by juridical persons other than the above companies, which are established by Japanese laws, of which all of the representatives are Japanese nationals
About the Flag
Japan is an island chain located in eastern Asia between the north Pacific Ocean and the Sea of Japan east of the Korean peninsula. It is a constitutional monarchy and a member of the OECD, the UN, and the IMO. The capital is Tokyo, and the Japanese language is spoken. The head of government is the Prime Minister, and there is a bicameral Diet. The Emperor is the chief of state in symbolic sense and without political power.
Japan is known for its strong work ethic, mastery of high technology, and remarkable government/industry cooperation. It has one of the most powerful economies in the world. Major trading partners are the Southeast Asia, the United States, and Western Europe, and chief exports are manufactures including machinery, motor vehicles, and consumer electronics. The unit of currency is the yen.
The Ship's Registration Rule ("Senpaku-Toki-Kisoku") regulates registrations in the Tokisho for the recording of vessel ownership, while the Ship's Law ("Senpaku-Hou") and its enforcement regulations cover registrations in the "Chihou-unyukyoku", an administrative register for determining the tax on a vessel.
Company Formation
Under Japanese laws, there are four types of companies: a partnership company ("Gomei Kaisha"); a limited partnership company ("Goshi Kaisha"); a joint-stock company ("Kabushiki Kaisha"); and a limited company ("Yugen Kaisha").
Among the above four companies, a joint-stock company is the most popular form in Japan. Stockholders are not liable for the obligations of the company beyond the value of their shares and are free to transfer their shares unless otherwise provided in the company's Articles of Incorporation. The business of the stock company is conducted by a board of directors ("torishimariyaku-kai"). Certain directors are appointed as representative directors and as such they have the authority to represent the company individually or if so required by resolution, jointly. There is no requirement as to the nationality of directors or shareholders of a Japanese company itself.
The limited company is a miniature of the stock company and usually has a relatively small number of investor-members with limited liability. A member is free to transfer his equity in the company to other members, but must obtain the approval of a general meeting to transfer his equity to a nonmember.
The partnership company is a legal entity similar to a partnership. A member of a partnership company assumes unlimited liability for the obligations of the company and must obtain the approval of all the other members before transferring his equity in the company.
In a limited partnership company, there are two classes of members: members with unlimited liability, who are liable for the obligations of the company and members with limited liability who are not liable for the obligations of the company beyond the value of their shares. In general, company registration is completed by a legal expert called "Shiho Shoshi (Judicial scrivener)" appointed by the founder of the new company. Government approval is not normally required.
Taxation
The basic taxation is a corporate tax to be imposed upon its net income. There are currently no special regulations which exempt shipowners from such corporate tax.
Withholding tax is payable in Japan on various taxable transactions, including without limitation dividends paid by a Japanese company to a nonresident payee.
Japan has concluded treaties for the avoidance of double taxation on income with fifty-six (56) Contracting States including Australia, Austria, Bangladesh, Belgium, Brazil, Canada, Denmark, Finland, France, Germany, India, Ireland, Italy, Republic of Korea, Luxembourg, Malaysia, New Zealand, Norway, Pakistan, Singapore, Sri Lanka, Spain, Sweden, Switzerland, Thailand, the United Kingdom, the United States and Zambia.
Registration and Documentation
Ships of 20 GRT or more with the exception of lighters without a propeller, must be registered in two places in the following order: first in "Tokisho" to record title to a Japanese vessel (ownership, bareboat charter, mortgage) for civil purposes and second in "Chihou-unyukyoku" for administrative control purposes and for determining vessel taxes.
Prior to registration in "Tokisho", the ships must be initially measured by "Chihou-unyukyoku". The following documents are required for the registration of title of a Japanese flag vessel in "Tokisho":
Application form
• Photocopy of Certificate of Ship's Particulars
• Certificate of Ownership (Sales Contract)
• Construction Certificate
• Certificate of Company's Registry
These documents should be submitted to the Vessel Registration Department. In order to delete a Japanese flag vessel for transfer to a foreign flag, the following documents are required from the Japanese Government:
• Application form
• Memorandum of Agreement (or in another words, a sale and purchase contract)
• Protocol of Delivery
• Document to report exporting of the vessel, although not mandatory
For all practical purposes, the consent of the mortgagee is also required prior to the deletion if the vessel has been subject to registered mortgage.
Bareboat Charter Registration
Traditional dual flag registration (a primary registration which is non-Japanese and bareboat registry which is established in Japan and vice versa) is not possible in Japan. However, a bareboat charter can be registered if a vessel is registered in Japan. The registration is made with an application from both the shipowner and the charterer. In such a case, the name of the charterer, the charter hire, the assignment and sub-lease option, the purchase option, and the timing of payment of charter hire can be registered. The bareboat charterparty, if registered, shall be effective even as against a party who has subsequently acquired title to the vessel. However, the bareboat charter of a Japanese flag vessel out to a non-Japanese person is subject to approval of the Japanese government under Japanese law. This bareboat charter registration is not popular in Japan.
Vessel and Yacht Eligibility & Survey Requirements
There is no age limitation for Japanese vessels.
Periodic surveys are required by either the Japanese Government or the Japanese classification society ("Nippon Kaiji Kyokai") under the Ship's Safety Law ("SenpakuAnzenHou") and its enforcement regulations. No other classification society is approved to carry out such periodic surveys of Japanese vessel. The interval and details of the surveys are regulated depending on the size of a vessel.
Crewing
Under the Ship's Crewing Law ("Senpaku Shokuin oyobi Kogata Senpaku Soujusha Hou"), certain numbers of Japanese licensed crew are required to be on board a vessel flying the Japanese flag. The numbers of such a crew and grade of such licenses are determined depending on type and size of the vessel.
Mortgages
In order to effect a ship mortgage, the following documents must be submitted to “Tokisho”:
• A form of contract which creates a mortgage ("Mortgage Contract")
• Loan Agreement or any other document showing valid existence of secured right
• Good Standing (“Shikaku Shomeisho”) of mortgagee and mortgagor in case of a corporate entity
• Application form
There are no nationality restrictions for mortgagees. In general, a loan agreement between a Japanese shipowner and a foreign lender shall not be subject to Japanese exchange control regulations.
A mortgagee has no right, irrespective of the express provisions contained in a mortgagee contract, to automatically acquire possession of a vessel in the case of event of default. A Japanese law does not allow a mortgage to be enforced by way of private sale. A mortgage shall be enforced through judicial sale under the laws of Japan.
A subsequent mortgage can be recorded against a vessel even if the consent of all the prior mortgagees is not submitted. The rank of priority among the mortgagees shall be determined in the order of timing of registration.
Under Japanese law, a creditor may register a mortgage on a vessel under construction although this is not common.
The following claims give rise to a maritime lien which will take priority over a mortgage under the laws of Japan:
• Expenses relating to the sale of the vessel and its appurtenances by official auction and expenses of preservation after commencement of the proceedings for the sale by official auction
• Expenses of preservation of the vessel and its appurtenances at the last port
• All public dues levied on the vessel in respect of a voyage
• Pilotage dues and towage dues
• Salvage remuneration and the ship's contribution to general average
• Claims which have arisen from a necessity to continue a voyage
• Claims of the Master and other crew which have arisen under their contracts of employment
• Claims which have arisen from the sale or construction of the vessel or the equipment of the vessel but only if the vessel has not yet made a voyage after her sale or construction
• Claims in respect of the equipment, food, and bunkers for the vessel's last voyage
• Claims generating a maritime lien under the law, which include among others, the International Carriage of Goods by Sea Act, the law relating to shipowners' rights to limit of liability and the Oil Compensation Law
Fees
For information about registration and related fees please contact:
Ministry of Land, Infrastructure, Transport and Tourism
Marine Bureau
Ministry of Land, Infrastructure and Transport
2-1-3, Kasumigaseki,
Chiyoda-ku
Tokyo 100-8918
Japan
Tel: +81-3-5253-8111
Website: https://www.mlit.go.jp/en/index.html
Contact
Survey, Measurement and Registration
Inspection and Measurement Division
Marine Bureau
Ministry of Land, Infrastructure and Transport
2-1-3, Kasumigaseki,
Chiyoda-ku
Tokyo 100-8918
Japan
Tel: +81-3-5253-8111
Website: https://www.mlit.go.jp/en/index.html
Shipowners' Association
Japanese Shipowners' Association
Kaiun Building, No 6-4, 2-chome
Hirakawa-cho, Chiyoda-ku
Tokyo, Japan
Tel: [81] (3) 3264 7171
Fax: [81] (3) 5226 9166
Website: https://www.jsanet.or.jp/e/index.html
Stockholm Agreement 96
IMO Convention 48
* IMO amendments 91
* IMO amendments 93
SOLAS Convention 74
SOLAS Protocol 78
SOLAS Protocol 88
LOAD LINES Convention 66
LOAD LINES Protocol 88
TONNAGE Convention 69
COLREG Convention 72
CSC Convention 72
CSC amendments 93
SFV Protocol 93
STCW Convention 78
STCW-F Convention 95
SAR Convention 79
STP Agreement 71
STP Protocol 73
IMSO Convention 76
INMARSAT OA 76
INMARSAT amendments 94
INMARSAT amendments 98
IMSO amendments 2006
IMSO amendments 2008
FACILITATION Convention 65
MARPOL 73/78 (Annex I/II)
MARPOL 73/78 (Annex IV)
MARPOL 73/78 (Annex V)
MARPOL Protocol 97 (Annex VI)
London Convention 72
London Convention Protocol 96
INTERVENTION Convention 69
INTERVENTION Protocol 73
CLC Convention 69
CLC Protocol 76
CLC Protocol 92
FUND Convention 71
FUND Protocol 92
FUND Protocol 2003
NUCLEAR Convention 71
MARPOL 73/78 (Annex III)
PAL Protocol 76
PAL Protocol 90
PAL Protocol 02
LLMC Convention 76
LLMC Protocol 96
SUA Convention 2005
SUA Protocol 2005
SALVAGE Convention 89
OPRC Convention 90
HNS Convention 96
OPRC/HNS 2000
BUNKERS CONVENTION 01
ANTI FOULING 01
BALLASTWATER 2004
NAIROBI WRC 2007
HONG KONG CONVENTION
HNS PROT 2010
Cape Town Agreement 2012
SUA Convention 88
SUA Protocol 88
IMO Conventions
Status of Conventions Japan
IMO Convention 48 x
SOLAS Convention 74 x
SOLAS Protocol 78 x
SOLAS Protocol 88 x
SOLAS Agreement 96
LOAD LINES Convention 66 x
LOAD LINES Protocol 88 x
TONNAGE Convention 69 x
COLREG Convention 72 x
CSC Convention 72 x
CSC amendments 93
SFV Protocol 93
Cape Town Agreement 2012
STCW Convention 78 x
STCW-F Convention 95
SAR Convention 79 x
STP Agreement 71
Space STP Protocol 73
IMSO Convention 76 x
INMARSAT OA 76 x
IMSO amendments 2006
IMSO amendments 2008
FACILITATION Convention 65 x
MARPOL 73/78 (Annex I/II) x
MARPOL 73/78 (Annex III) x
MARPOL 73/78 (Annex IV) x
MARPOL 73/78 (Annex V) x
MARPOL Protocol 97 (Annex VI) x
London Convention 72 x
London Convention Protocol 96 x
INTERVENTION Convention 69 x
INTERVENTION Protocol 73
CLC Convention 69 d
CLC Protocol 76 x
CLC Protocol 92 x
FUND Protocol 76 x
FUND Protocol 92 x
FUND Protocol 2003 x
NUCLEAR Convention 71
PAL Convention 74
PAL Protocol 76
PAL Protocol 90
PAL Protocol 02
LLMC Convention 76 d
LLMC Protocol 96 x
SUA Convention 88 x
SUA Protocol 88 x
SUA Convention 2005
SUA Protocol 2005
SALVAGE Convention 89
OPRC Convention 90 x
HNS Convention 96
HNS PROT 2010
OPRC/HNS 2000 x
BUNKERS CONVENTION 01
ANTI FOULING 2001 x
BALLASTWATER 2004 x
NAIROBI WRC 2007 x
HONG KONG CONVENTION x
x= ratification
d=denunciation