Doing Business 2018 Japan Economy Pro le of Japan Doing Business 2018 Indicators (in order of appearance in the document) Starting a business Procedures, time, cost and paid-in minimum capital to start a limited liability company Dealing with construction Procedures, time and cost to complete all formalities to build a warehouse and the quality control and permits safety mechanisms in the construction permitting system Getting electricity Procedures, time and cost to get connected to the electrical grid, the reliability of the electricity supply and the transparency of tariffs Registering property Procedures, time and cost to transfer a property and the quality of the land administration system Getting credit Movable collateral laws and credit information systems Protecting minority investors Minority shareholders’ rights in related-party transactions and in corporate governance Paying taxes Payments, time and total tax rate for a firm to comply with all tax regulations as well as post-filing processes Trading across borders Time and cost to export the product of comparative advantage and import auto parts Enforcing contracts Time and cost to resolve a commercial dispute and the quality of judicial processes Resolving insolvency Time, cost, outcome and recovery rate for a commercial insolvency and the strength of the legal framework for insolvency Labor market regulation Flexibility in employment regulation and aspects of job quality About Doing Business The Doing Business project provides objective measures of business regulations and their enforcement across 190 economies and selected cities at the subnational and regional level. The Doing Business project, launched in 2002, looks at domestic small and medium-size companies and measures the regulations applying to them through their life cycle. Doing Business captures several important dimensions of the regulatory environment as it applies to local rms. It provides quantitative indicators on regulation for starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts and resolving insolvency. Doing Business also measures features of labor market regulation. Although Doing Business does not present rankings of economies on the labor market regulation indicators or include the topic in the aggregate distance to frontier score or ranking on the ease of doing business, it does present the data for these indicators. By gathering and analyzing comprehensive quantitative data to compare business regulation environments across economies and over time, Doing Business encourages economies to compete towards more e cient regulation; o ers measurable benchmarks for reform; and serves as a resource for academics, journalists, private sector researchers and others interested in the business climate of each economy. In addition, Doing Business o ers detailed subnational reports, which exhaustively cover business regulation and reform in di erent cities and regions within a nation. These reports provide data on the ease of doing business, rank each location, and recommend reforms to improve performance in each of the indicator areas. Selected cities can compare their business regulations with other cities in the economy or region and with the 190 economies that Doing Business has ranked. The rst Doing Business report, published in 2003, covered 5 indicator sets and 133 economies. This year’s report covers 11 indicator sets and 190 economies. Most indicator sets refer to a case scenario in the largest business city of each economy, except for 11 economies that have a population of more than 100 million as of 2013 (Bangladesh, Brazil, China, India, Indonesia, Japan, Mexico, Nigeria, Pakistan, the Russian Federation and the United States) where Doing Business, also collected data for the second largest business city. The data for these 11 economies are a population-weighted average for the 2 largest business cities. The project has bene ted from feedback from governments, academics, practitioners and reviewers. The initial goal remains: to provide an objective basis for understanding and improving the regulatory environment for business around the world. Page 2   for insolvency Doing Business Labor market 2018 regulation Japan Flexibility in employment regulation and aspects of job quality About Doing Business The Doing Business project provides objective measures of business regulations and their enforcement across 190 economies and selected cities at the subnational and regional level. The Doing Business project, launched in 2002, looks at domestic small and medium-size companies and measures the regulations applying to them through their life cycle. Doing Business captures several important dimensions of the regulatory environment as it applies to local rms. It provides quantitative indicators on regulation for starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts and resolving insolvency. Doing Business also measures features of labor market regulation. Although Doing Business does not present rankings of economies on the labor market regulation indicators or include the topic in the aggregate distance to frontier score or ranking on the ease of doing business, it does present the data for these indicators. By gathering and analyzing comprehensive quantitative data to compare business regulation environments across economies and over time, Doing Business encourages economies to compete towards more e cient regulation; o ers measurable benchmarks for reform; and serves as a resource for academics, journalists, private sector researchers and others interested in the business climate of each economy. In addition, Doing Business o ers detailed subnational reports, which exhaustively cover business regulation and reform in di erent cities and regions within a nation. These reports provide data on the ease of doing business, rank each location, and recommend reforms to improve performance in each of the indicator areas. Selected cities can compare their business regulations with other cities in the economy or region and with the 190 economies that Doing Business has ranked. The rst Doing Business report, published in 2003, covered 5 indicator sets and 133 economies. This year’s report covers 11 indicator sets and 190 economies. Most indicator sets refer to a case scenario in the largest business city of each economy, except for 11 economies that have a population of more than 100 million as of 2013 (Bangladesh, Brazil, China, India, Indonesia, Japan, Mexico, Nigeria, Pakistan, the Russian Federation and the United States) where Doing Business, also collected data for the second largest business city. The data for these 11 economies are a population-weighted average for the 2 largest business cities. The project has bene ted from feedback from governments, academics, practitioners and reviewers. The initial goal remains: to provide an objective basis for understanding and improving the regulatory environment for business around the world. The distance to frontier (DTF) measure shows the distance of each economy to the “frontier,” which represents the best performance observed on each of the indicators across all economies in the Doing Business sample since 2005. An economy’s distance to frontier is re ected on a scale from 0 to 100, where 0 represents the lowest performance and 100 represents the frontier. The ease of doing business ranking ranges from 1 to 190. The ranking of 190 economies is determined by sorting the aggregate distance to frontier scores, rounded to two decimals. More about Doing Business (PDF, 5MB) Ease of Doing Business in Region OECD high income DB 2018 Rank 190 1 Japan Income Category High income 34 Population 126,994,511 DB 2018 Distance to Frontier (DTF) GNI Per Capita (US$) 38,000 0 100 75.68 City Covered Tokyo DB 2018 Distance to Frontier (DTF) 0 100 83.92: Korea, Rep. (Rank: 4) 82.54: United States (Rank: 6) 80.14: Australia (Rank: 14) 77.46: Regional Average (OECD high income) 75.68: Japan (Rank: 34) Page 3   aggregate distance to frontier scores, rounded to two decimals. More Doingabout 2018 (PDF, Doing Business Business 5MB) Japan Ease of Doing Business in Region OECD high income DB 2018 Rank 190 1 Japan Income Category High income 34 Population 126,994,511 DB 2018 Distance to Frontier (DTF) GNI Per Capita (US$) 38,000 0 100 75.68 City Covered Tokyo DB 2018 Distance to Frontier (DTF) 0 100 83.92: Korea, Rep. (Rank: 4) 82.54: United States (Rank: 6) 80.14: Australia (Rank: 14) 77.46: Regional Average (OECD high income) 75.68: Japan (Rank: 34) Note: The distance to frontier (DTF) measure shows the distance of each economy to the “frontier,” which represents the best performance observed on each of the indicators across all economies in the Doing Business sample since 2005. An economy’s distance to frontier is re ected on a scale from 0 to 100, where 0 represents the lowest performance and 100 represents the frontier. The ease of doing business ranking ranges from 1 to 190. Rankings on Doing Business topics - Japan 1 1 17 28 50 52 51 51 55 62 68 77 82 Rank 106 109 136 163 190 Starting Dealing Getting Registering Getting Protecting Paying Trading Enforcing Resolving a with Electricity Property Credit Minority Taxes across Contracts Insolvency Business Construction Investors Borders Permits Distance to Frontier (DTF) on Doing Business topics - Japan 100 93.44 89.88 84.37 86.51 80 76.71 73.36 73.92 65.26 58.33 60 55.00 DTF 40 20 0 Starting Dealing Getting Registering Getting Protecting Paying Trading Enforcing Resolving a with Electricity Property Credit Minority Taxes across Contracts Insolvency Business Construction Change:0.00 Change:+0.01 Change:0.00 Investors Change:+0.56 Borders Change:0.00 Change:+0.10 Change:0.00 Permits Change:0.00 Change:0.00 Change:+0.03 Starting a Business Page 4   This topic measures the paid-in minimum capital requirement, number of procedures, time and cost for a small- to medium-sized a with Electricity Property Credit Minority Taxes across Contracts Insolvency Business Construction Change:0.00 Change:+0.01 Change:0.00 Investors Change:+0.56 Borders Change:0.00 Change:+0.10 Change:0.00 Permits Change:0.00 Change:0.00 Doing Business 2018 Japan Change:+0.03 Starting a Business This topic measures the paid-in minimum capital requirement, number of procedures, time and cost for a small- to medium-sized limited liability company to start up and formally operate in economy’s largest business city. To make the data comparable across 190 economies, Doing Business uses a standardized business that is 100% domestically owned, has start-up capital equivalent to 10 times income per capita, engages in general industrial or commercial activities and employs between 10 and 50 people one month after the commencement of operations, all of whom are domestic nationals. Starting a Business considers two types of local limited liability companies that are identical in all aspects, except that one company is owned by 5 married women and the other by 5 married men. The distance to frontier score for each indicator is the average of the scores obtained for each of the component indicators. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Procedures to legally start and operate a To make the data comparable across economies, several assumptions company (number) about the business and the procedures are used. It is assumed that any required information is readily available and that the entrepreneur will pay Pre-registration (for example, name verification no bribes. or reservation, notarization) Registration in economy’s largest business city The business: - Is a limited liability company (or its legal equivalent). If there is more than Post-registration (for example, social security one type of limited liability company in the economy, the most common registration, company seal) among domestic rms is chosen. Information on the most common form is Obtaining approval from spouse to start business obtained from incorporation lawyers or the statistical o ce. or leave home to register company - Operates in the economy’s largest business city and the entire o ce Obtaining any gender-specific permission that space is approximately 929 square meters (10,000 square feet). For 11 can impact company registration, company economies the data are also collected for the second largest business city. operations and process of getting national - Is 100% domestically owned and has ve owners, none of whom is a legal identity card entity; and has a start-up capital of 10 times income per capita and has a Time required to complete each procedure turnover of at least 100 times income per capita. (calendar days) - Performs general industrial or commercial activities, such as the production or sale of goods or services to the public. The business does Does not include time spent gathering not perform foreign trade activities and does not handle products subject information to a special tax regime, for example, liquor or tobacco. It does not use Each procedure starts on a separate day (2 heavily polluting production processes. procedures cannot start on the same day) - Leases the commercial plant or o ces and is not a proprietor of real Procedures fully completed online are recorded estate and the amount of the annual lease for the o ce space is equivalent as ½ day to 1 times income per capita. Procedure is considered completed once final - Does not qualify for investment incentives or any special bene ts. document is received - Has at least 10 and up to 50 employees one month after the commencement of operations, all of whom are domestic nationals. No prior contact with officials - Has a company deed 10 pages long. Cost required to complete each procedure (% of The owners: income per capita) - Have reached the legal age of majority. If there is no legal age of majority, Official costs only, no bribes they are assumed to be 30 years old. No professional fees unless services required by - Are sane, competent, in good health and have no criminal record. law or commonly used in practice - Are married and the marriage is monogamous and registered with the authorities. Paid-in minimum capital (% of income per capita) - Where the answer di ers according to the legal system applicable to the Funds deposited in a bank or with third party woman or man in question (as may be the case in economies where there before registration or up to 3 months after is legal plurality), the answer used will be the one that applies to the incorporation majority of the population. Page 5   Starting a Business - Tokyo before registration or up to 3 months after is legal plurality), the answer used will be the one that applies to the incorporation majority of the population. Doing Business 2018 Japan Starting a Business - Tokyo Standardized Company Legal form Godo Kaisha Paid-in minimum capital requirement JPY 1 City Covered Tokyo OECD high OECD high Indicator Tokyo income income Overall Best Performer Procedure – Men (number) 9 4.9 4.9 1.00 (New Zealand) Time – Men (days) 12.5 8.5 8.5 0.50 (New Zealand) Cost – Men (% of income per capita) 7.5 3.1 3.1 0.00 (United Kingdom) Procedure – Women (number) 9 4.9 4.9 1.00 (New Zealand) Time – Women (days) 12.5 8.5 8.5 0.50 (New Zealand) Cost – Women (% of income per capita) 7.5 3.1 3.1 0.00 (United Kingdom) Paid-in min. capital (% of income per capita) 0.0 8.7 8.7 0.00 (113 Economies) Figure – Starting a Business in Japan and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 96.47: Australia (Rank: 7) 95.83: Korea, Rep. (Rank: 9) 91.23: United States (Rank: 49) 84.29: Tokyo Note: The ranking of economies on the ease of starting a business is determined by sorting their distance to frontier scores for starting a business. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Starting a Business in Tokyo – Procedure, Time and Cost Time Cost 8 12 7 10 ome per capita) 6 8 5 (days) Page 6   6 4 starting a business. These scores are the simple average of the distance to frontier scores for each of the component indicators. Doing Business 2018 Japan Figure – Starting a Business in Tokyo – Procedure, Time and Cost Time Cost 8 12 7 10 Cost (% of income per capita) 6 8 5 Time (days) 6 4 3 4 2 2 1 0 0 1 2 3 4 5 6 7 8 9 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Details – Starting a Business in Tokyo – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Search the company name Less than one day no charge Agency : Legal A airs Bureau (online procedure) Under the Japanese Company Laws, entrepreneurs may not le an application for incorporating a company if the same company name and head o ce address are already registered. There is no need for entrepreneurs to check the uniqueness of the company name and make the name reservation at the Legal A airs Bureau of the Ministry of Justice. However, they need to check if the proposed company name and head o ce address has been registered. This can be easily be checked through books or personal computers installed and o ered for searching at the Legal A airs Bureaus or online http://www1.touki.or.jp/gateway.html 2 Make a company seal 3 days JPY 10,000 - JPY Agency : Seal maker 20,000 The company seal is required by law: Article 20 of the Commercial Registration Act. The associated fee is JPY 10,000 for machine-carved seal or JPY 20,000 for hand-carved seal. The company seal must be registered at the Legal A airs Bureau at the time of the incorporation under the Commercial Registration Act. An entrepreneur usually les the registration of the company seal as well as the registration of incorporation of the company with the competent Legal A airs Bureau. 3 Open a bank account 1 day no charge Agency : Bank According to Article 578 of the Companies Act, prior to incorporating the Page 7   company, each person who intends to be a partner of the GK must pay (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Doing Business 2018 Japan Details – Starting a Business in Tokyo – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Search the company name Less than one day no charge Agency : Legal A airs Bureau (online procedure) Under the Japanese Company Laws, entrepreneurs may not le an application for incorporating a company if the same company name and head o ce address are already registered. There is no need for entrepreneurs to check the uniqueness of the company name and make the name reservation at the Legal A airs Bureau of the Ministry of Justice. However, they need to check if the proposed company name and head o ce address has been registered. This can be easily be checked through books or personal computers installed and o ered for searching at the Legal A airs Bureaus or online http://www1.touki.or.jp/gateway.html 2 Make a company seal 3 days JPY 10,000 - JPY Agency : Seal maker 20,000 The company seal is required by law: Article 20 of the Commercial Registration Act. The associated fee is JPY 10,000 for machine-carved seal or JPY 20,000 for hand-carved seal. The company seal must be registered at the Legal A airs Bureau at the time of the incorporation under the Commercial Registration Act. An entrepreneur usually les the registration of the company seal as well as the registration of incorporation of the company with the competent Legal A airs Bureau. 3 Open a bank account 1 day no charge Agency : Bank According to Article 578 of the Companies Act, prior to incorporating the company, each person who intends to be a partner of the GK must pay capital into nancial institutions. Furthermore, According to Article 117 of the Commercial Registration Act, the “receipt for payment of capital contribution” shall be attached to a written application for a registration of incorporation. As such, bank accounts are used in practice by most entrepreneurs for depositing the payment of paid-in capital. After submitting the application, it can take between 1-2 weeks for the bank account to be open due to background checks. The application includes the following: - Certi cate of GK’s company seal which has been registered to Legal A airs Bureau under the name of representative of GK; - The articles of incorporation of GK; - O ce Lease contract (optional). 4 Register at the Legal A airs Bureau of the Ministry of Justice 3 days 0.7% of the capital Agency : Legal A airs Bureau of the Ministry of Justice amount or JPY 60,000, whichever is To apply for registration, the entrepreneur must submit several supporting higher plus Yen 450 documents with the application to the Legal A airs Bureau headquarter or for the Certificate of any of its branch o ces designated in major cities, including: corporation seal registration - Articles of incorporation (signed by 5 entrepreneurs who contributed capital) - Application of seal registration - Letter of proxy (if company is registered by a lawyer or a judicial scrivener) - Personal seal of the executive member - Proof of paid in capital - Proof of address Page 8   - The articles of incorporation of GK; O ce Lease Doing -Business contract 2018 (optional). Japan 4 Register at the Legal A airs Bureau of the Ministry of Justice 3 days 0.7% of the capital Agency : Legal A airs Bureau of the Ministry of Justice amount or JPY 60,000, whichever is To apply for registration, the entrepreneur must submit several supporting higher plus Yen 450 documents with the application to the Legal A airs Bureau headquarter or for the Certificate of any of its branch o ces designated in major cities, including: corporation seal registration - Articles of incorporation (signed by 5 entrepreneurs who contributed capital) - Application of seal registration - Letter of proxy (if company is registered by a lawyer or a judicial scrivener) - Personal seal of the executive member - Proof of paid in capital - Proof of address - Con rmation of appointment of the company representative - Con rmation from company representative that he agrees to the appointment. Additionally, the company’s seal must be registered at the Legal A airs Bureau of the Ministry of Justice upon registration of the company. Certi cate of corporation seal registration costs Yen 450. Once the led documents are reviewed and approved, the company applies for the issuance of a company registration certi cate. Normally, a judicial scrivener completes this registration procedure on behalf of the company. By virtue of the amended Commercial Registration Regulations in force since June 2004, company registration applications can be submitted online. To do so, the user must rst obtain an electronic signature or a digital certi cation. There are two types of digital certi cations: data le and IC card. The user must purchase an IC card reader to use the IC card system. 5 File the noti cation of company incorporation and the opening of a 1 day no charge payroll o ce; and Apply for the approval of blue tax returns at the District Tax O ce Agency : National Tax Agency The noti cation of the company incorporation must be led within 2 months of the incorporation date. The noti cation of opening a payroll o ce must be led within one month of the opening of a payroll o ce. As of January 2016, 13-digit "corporation identi cation numbers" (houjin bangou) must be indicated on (a) the noti cation of company incorporation, (b) noti cation of the opening of a payroll o ce and (c) application for the approval of blue tax returns.The application for the approval of blue tax returns must be led either within 3 months of the incorporation date, or a day prior to the end of the rst scal year, whichever comes rst. Applicants can submit their application either online or in person. 6 File the noti cation of commencement of business at the tax o ce of 1 day no charge the municipal or prefectural government Agency : Local tax department of Tokyo Metropolitan Government If the head o ce of the company is located within Tokyo’s 23 wards, the company must le a Noti cation for the Commencement of Business at the Page 9   tax o ce of the Tokyo Metropolitan Government within 15 days of company Doing Applicants Business can submit 2018 their application either online or in person. Japan 6 File the noti cation of commencement of business at the tax o ce of 1 day no charge the municipal or prefectural government Agency : Local tax department of Tokyo Metropolitan Government If the head o ce of the company is located within Tokyo’s 23 wards, the company must le a Noti cation for the Commencement of Business at the tax o ce of the Tokyo Metropolitan Government within 15 days of company incorporation. If the head o ce of the company is located outside Tokyo’s 23 wards, the company must le a Noti cation of Incorporation at the tax o ce of the municipal government and the tax o ce of the prefectural government within 1 month of company incorporation. 7 File the necessary labor insurance noti cations and employment rules 1 day no charge at the Labor Standards Inspection O ce Agency : Labor Standards Inspection O ce Employees are automatically provided with labor insurance as soon as they are hired. Labor insurance usually includes employment and worker's compensation insurance. Upon recruitment, the company must le without delay the following documents at the competent Labor Standards Inspection O ce: • Noti cation of the application for labor insurance within 10 days of the insurance coverage commencement date • Noti cation of the approximate insurance contributions within 50 days of the insurance coverage commencement date • The rules of employment (once the company hires 10 or more employees) • Agreement on overtime and holiday work (the "36 agreement") if the company anticipates that its employees will work overtime or on public holidays, irrespective of the number of employees. • Certi cate of Registered Matters (Certi cate of Company Registration)  8 File the applications for health insurance and public welfare pension at 1 day no charge the Japan Pension Service Agency : Japan Pension Service As soon as the company and its employees are covered for health insurance and public welfare pension, the company must le the following documents at the Social Insurance O ce within 5 days of the business insurance coverage commencement date: - Noti cation of the acquisition of insured status - The insurance details covering Health and Employee Pension insurance - Certi cate of Registered Matters (Certi cate of Company Registration)  9 File the company application for employment insurance at the Public 1 day no charge Employment Security O ce Agency : Public Employment Security O ce The noti cation of the company's application for employment insurance must be led at the Public Employment Security O ce within 10 days of commencement of employment by the company. When a new employee is recruited, he/she is automatically insured under the company's employment insurance. The company must thus le a "Noti cation of Acquisition of Insured Status under Employment Insurance" Page 10   at the Public Employment Security O ce by the 10th day of the month - The insurance details covering Health and Employee Pension insurance Certi cate of Doing -Business Registered 2018 JapanMatters (Certi cate of Company Registration)  9 File the company application for employment insurance at the Public 1 day no charge Employment Security O ce Agency : Public Employment Security O ce The noti cation of the company's application for employment insurance must be led at the Public Employment Security O ce within 10 days of commencement of employment by the company. When a new employee is recruited, he/she is automatically insured under the company's employment insurance. The company must thus le a "Noti cation of Acquisition of Insured Status under Employment Insurance" at the Public Employment Security O ce by the 10th day of the month immediately consecutive to that of the employee's appointment date. Applies to women only. Takes place simultaneously with previous procedure. Starting a Business - Osaka Standardized Company Legal form Godo Kaisha (LLC) Paid-in minimum capital requirement JPY 1 City Covered Osaka OECD high OECD high Indicator Osaka income income Overall Best Performer Procedure – Men (number) 9 4.9 4.9 1.00 (New Zealand) Time – Men (days) 11.5 8.5 8.5 0.50 (New Zealand) Cost – Men (% of income per capita) 7.5 3.1 3.1 0.00 (United Kingdom) Procedure – Women (number) 9 4.9 4.9 1.00 (New Zealand) Time – Women (days) 11.5 8.5 8.5 0.50 (New Zealand) Cost – Women (% of income per capita) 7.5 3.1 3.1 0.00 (United Kingdom) Paid-in min. capital (% of income per capita) 0.0 8.7 8.7 0.00 (113 Economies) Figure – Starting a Business in Japan and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 96.47: Australia (Rank: 7) 95.83: Korea, Rep. (Rank: 9) 91.23: United States (Rank: 49) 84.54: Osaka Page 11   Applies to women only. Takes place simultaneously with previous procedure. Doing Business 2018 Japan Starting a Business - Osaka Standardized Company Legal form Godo Kaisha (LLC) Paid-in minimum capital requirement JPY 1 City Covered Osaka OECD high OECD high Indicator Osaka income income Overall Best Performer Procedure – Men (number) 9 4.9 4.9 1.00 (New Zealand) Time – Men (days) 11.5 8.5 8.5 0.50 (New Zealand) Cost – Men (% of income per capita) 7.5 3.1 3.1 0.00 (United Kingdom) Procedure – Women (number) 9 4.9 4.9 1.00 (New Zealand) Time – Women (days) 11.5 8.5 8.5 0.50 (New Zealand) Cost – Women (% of income per capita) 7.5 3.1 3.1 0.00 (United Kingdom) Paid-in min. capital (% of income per capita) 0.0 8.7 8.7 0.00 (113 Economies) Figure – Starting a Business in Japan and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 96.47: Australia (Rank: 7) 95.83: Korea, Rep. (Rank: 9) 91.23: United States (Rank: 49) 84.54: Osaka Note: The ranking of economies on the ease of starting a business is determined by sorting their distance to frontier scores for starting a business. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Starting a Business in Osaka – Procedure, Time and Cost Time Cost 8 10 7 ome per capita) 6 8 5 (days) Page 12   6 4 starting a business. These scores are the simple average of the distance to frontier scores for each of the component indicators. Doing Business 2018 Japan Figure – Starting a Business in Osaka – Procedure, Time and Cost Time Cost 8 10 7 Cost (% of income per capita) 6 8 5 Time (days) 6 4 3 4 2 2 1 0 0 1 2 3 4 5 6 7 8 9 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Details – Starting a Business in Osaka – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Search the company name Less than one day no charge Agency : Legal A airs Bureau of the Ministry of Justice (online procedure) Under the Japanese Company Laws, entrepreneurs may not le an application for incorporating a company if the same company name and head o ce address are already registered. There is no need for entrepreneurs to check the uniqueness of the company name and make the name reservation at the Legal A airs Bureau of the Ministry of Justice. However, they need to check if the proposed company name and head o ce address has been registered. This can be easily be checked through books or personal computers installed and o ered for searching at the Legal A airs Bureaus or online http://www1.touki.or.jp/gateway.html 2 Make a company seal 3 days JPY 10,000 - JPY Agency : Seal maker 20,000 The company seal is required by law: Article 20 of the Commercial Registration Act. The associated fee is JPY 10,000 for machine-carved seal or JPY 20,000 for hand-carved seal. 3 Open a bank account 1 day no charge Agency : Bank According to Article 578 of the Companies Act, prior to incorporating the company, each person who intends to be a partner of the GK must pay capital into nancial institutions. Furthermore, According to Article 117 of the Commercial Registration Act, the “receipt for payment of capital contribution” shall be attached to a written application for a registration of Page 13   incorporation. As such, bank accounts are used in practice by most (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Doing Business 2018 Japan Details – Starting a Business in Osaka – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Search the company name Less than one day no charge Agency : Legal A airs Bureau of the Ministry of Justice (online procedure) Under the Japanese Company Laws, entrepreneurs may not le an application for incorporating a company if the same company name and head o ce address are already registered. There is no need for entrepreneurs to check the uniqueness of the company name and make the name reservation at the Legal A airs Bureau of the Ministry of Justice. However, they need to check if the proposed company name and head o ce address has been registered. This can be easily be checked through books or personal computers installed and o ered for searching at the Legal A airs Bureaus or online http://www1.touki.or.jp/gateway.html 2 Make a company seal 3 days JPY 10,000 - JPY Agency : Seal maker 20,000 The company seal is required by law: Article 20 of the Commercial Registration Act. The associated fee is JPY 10,000 for machine-carved seal or JPY 20,000 for hand-carved seal. 3 Open a bank account 1 day no charge Agency : Bank According to Article 578 of the Companies Act, prior to incorporating the company, each person who intends to be a partner of the GK must pay capital into nancial institutions. Furthermore, According to Article 117 of the Commercial Registration Act, the “receipt for payment of capital contribution” shall be attached to a written application for a registration of incorporation. As such, bank accounts are used in practice by most entrepreneurs for depositing the payment of paid-in capital. After submitting the application, it can take between 1-2 weeks for the bank account to be open due to background checks. The application includes the following: - Certi cate of GK’s company seal which has been registered to Legal A airs Bureau under the name of representative of GK; - The articles of incorporation of GK; - O ce Lease contract (optional). 4 Register at the Legal A airs Bureau of the Ministry of Justice 2 days 0.7% of the capital Agency : Legal A airs Bureau of the Ministry of Justice amount or JPY 60,000, whichever is To apply for registration, the entrepreneur must submit several supporting higher plus Yen 450 documents with the application to the Legal A airs Bureau headquarter or for the Certificate of any of its branch o ces designated in major cities, including: corporation seal registration - Articles of incorporation - Application of seal registration - Letter of proxy (if company is registered by a lawyer or a judicial scrivener) - Personal seal of the director or a lawyer registering the company - Proof of paid in capital - Proof of address - Con rmation of appointment of the company representative - Con rmation from company representative that he agrees to the appointment. Additionally, the company’s seal must be registered at the Legal A airs Page 14   - The articles of incorporation of GK; O ce Lease Doing -Business contract 2018 (optional). Japan 4 Register at the Legal A airs Bureau of the Ministry of Justice 2 days 0.7% of the capital Agency : Legal A airs Bureau of the Ministry of Justice amount or JPY 60,000, whichever is To apply for registration, the entrepreneur must submit several supporting higher plus Yen 450 documents with the application to the Legal A airs Bureau headquarter or for the Certificate of any of its branch o ces designated in major cities, including: corporation seal registration - Articles of incorporation - Application of seal registration - Letter of proxy (if company is registered by a lawyer or a judicial scrivener) - Personal seal of the director or a lawyer registering the company - Proof of paid in capital - Proof of address - Con rmation of appointment of the company representative - Con rmation from company representative that he agrees to the appointment. Additionally, the company’s seal must be registered at the Legal A airs Bureau of the Ministry of Justice upon registration of the company. Certi cate of corporation seal registration costs Yen 450. Once the led documents are reviewed and approved, the company applies for the issuance of a company registration certi cate. Normally, a judicial scrivener completes this registration procedure on behalf of the company. By virtue of the amended Commercial Registration Regulations in force since June 2004, company registration applications can be submitted online. To do so, the user must rst obtain an electronic signature or a digital certi cation. There are two types of digital certi cations: data le and IC card. The user must purchase an IC card reader to use the IC card system. 5 File the noti cation of company incorporation and the opening of a 1 day no charge payroll o ce; and Apply for the approval of blue tax returns at the District Tax O ce Agency : Tax O ce The noti cation of the company incorporation must be led within 2 months of the incorporation date. The noti cation of opening a payroll o ce must be led within one month of the opening of a payroll o ce. The application for the approval of blue tax returns must be led either within 3 months of the incorporation date, or a day prior to the end of the rst scal year, whichever comes rst. Applicants can submit their application either online or in person. 6 File the noti cation of commencement of business at the tax o ce of 1 day no charge the municipal or prefectural government Agency : Tax O ce If the head o ce of the company is located outside Tokyo’s 23 wards, the company must le a Noti cation of Incorporation at the tax o ce of the municipal government and the tax o ce of the prefectural government within 2 month of company incorporation. 7 File the necessary labor insurance noti cations and employment rules 1 day no charge at the Labor Standards Inspection O ce Page 15   municipal government and the tax o ce of the prefectural government Doing within 2 month Business 2018 Japanincorporation. of company 7 File the necessary labor insurance noti cations and employment rules 1 day no charge at the Labor Standards Inspection O ce Agency : Labor Standards Inspection O ce Employees are automatically provided with labor insurance as soon as they are hired. Labor insurance usually includes employment and worker's compensation insurance. Upon recruitment, the company must le without delay the following documents at the competent Labor Standards Inspection O ce: • Noti cation of the application for labor insurance • Noti cation of the commencement of labor insurance within 10 days of the insurance coverage commencement date • Noti cation of the approximate insurance contributions within 50 days of the insurance coverage commencement date • The rules of employment (once the company hires 10 or more employees) • Agreement on overtime and holiday work (the "36 agreement") if the company anticipates that its employees will work overtime or on public holidays, irrespective of the number of employees • Certi cate of Registered Matters (Certi cate of Company Registration)  8 File the applications for health insurance and public welfare pension at 1 day no charge the Japan Pension Service Agency : Japan Pension Service As soon as the company and its employees are covered for health insurance and public welfare pension, the company must le the following documents at the Social Insurance O ce within 5 days of the business insurance coverage commencement date: - Noti cation of the acquisition of insured status - The insurance details covering Health and Employee Pension insurance - Certi cate of Registered Matters (Certi cate of Company Registration)  9 File the company application for employment insurance at the Public 1 day no charge Employment Security O ce Agency : Public Employment Security O ce The noti cation of the company's application for employment insurance must be led at the Public Employment Security O ce within 10 days of commencement of employment by the company. When a new employee is recruited, he/she is automatically insured under the company's employment insurance. The company must thus le a "Noti cation of Acquisition of Insured Status under Employment Insurance" at the Public Employment Security O ce by the 10th day of the month immediately consecutive to that of the employee's appointment date. Applies to women only. Takes place simultaneously with previous procedure. Dealing with Construction Permits This topic tracks the procedures, time and cost to build a warehouse—including obtaining necessary the licenses and permits, submitting all required noti cations, requesting and receiving all necessary inspections and obtaining utility connections. In addition, the Dealing with Construction Permits indicator measures the building quality control index, evaluating the quality of Page 16   building regulations, the strength of quality control and safety mechanisms, liability and insurance regimes, and professional Applies to women only. Takes place simultaneously with previous procedure. Doing Business 2018 Japan Dealing with Construction Permits This topic tracks the procedures, time and cost to build a warehouse—including obtaining necessary the licenses and permits, submitting all required noti cations, requesting and receiving all necessary inspections and obtaining utility connections. In addition, the Dealing with Construction Permits indicator measures the building quality control index, evaluating the quality of building regulations, the strength of quality control and safety mechanisms, liability and insurance regimes, and professional certi cation requirements. The most recent round of data collection was completed in June 2017. See the methodology for more information What the indicators measure Case study assumptions Procedures to legally build a warehouse (number) To make the data comparable across economies, several assumptions about the construction company, the warehouse project and the utility Submitting all relevant documents and obtaining connections are used. all necessary clearances, licenses, permits and certificates The construction company (BuildCo): Submitting all required notifications and - Is a limited liability company (or its legal equivalent) and operates in the receiving all necessary inspections economy’s largest business city. For 11 economies the data are also collected for the second largest business city. Obtaining utility connections for water and - Is 100% domestically and privately owned; has ve owners, none of whom sewerage is a legal entity. Has a licensed architect and a licensed engineer, both Registering and selling the warehouse after its registered with the local association of architects or engineers. BuildCo is completion not assumed to have any other employees who are technical or licensed Time required to complete each procedure experts, such as geological or topographical experts. (calendar days) - Owns the land on which the warehouse will be built and will sell the warehouse upon its completion. Does not include time spent gathering information The warehouse: Each procedure starts on a separate day— - Will be used for general storage activities, such as storage of books or though procedures that can be fully completed stationery. online are an exception to this rule - Will have two stories, both above ground, with a total constructed area of Procedure is considered completed once final approximately 1,300.6 square meters (14,000 square feet). Each oor will document is received be 3 meters (9 feet, 10 inches) high and will be located on a land plot of No prior contact with officials approximately 929 square meters (10,000 square feet) that is 100% owned by BuildCo, and the warehouse is valued at 50 times income per capita. Cost required to complete each procedure (% of - Will have complete architectural and technical plans prepared by a warehouse value) licensed architect. If preparation of the plans requires such steps as Official costs only, no bribes obtaining further documentation or getting prior approvals from external agencies, these are counted as procedures. Building quality control index (0-15) - Will take 30 weeks to construct (excluding all delays due to administrative Sum of the scores of six component indices: and regulatory requirements). Quality of building regulations (0-2) The water and sewerage connections: Quality control before construction (0-1) - Will be 150 meters (492 feet) from the existing water source and sewer Quality control during construction (0-3) tap. If there is no water delivery infrastructure in the economy, a borehole Quality control after construction (0-3) will be dug. If there is no sewerage infrastructure, a septic tank in the smallest size available will be installed or built. Liability and insurance regimes (0-2) - Will have an average water use of 662 liters (175 gallons) a day and an Professional certifications (0-4) average wastewater ow of 568 liters (150 gallons) a day. Will have a peak water use of 1,325 liters (350 gallons) a day and a peak wastewater ow of 1,136 liters (300 gallons) a day. - Will have a constant level of water demand and wastewater ow throughout the year; will be 1 inch in diameter for the water connection and 4 inches in diameter for the sewerage connection. Dealing with Construction Permits - Tokyo Page 17   and 4 inches in diameter for the sewerage connection. Doing Business 2018 Japan Dealing with Construction Permits - Tokyo Standardized Warehouse Estimated value of warehouse JPY 218,725,345.10 City Covered Tokyo OECD high OECD high Indicator Tokyo income income Overall Best Performer Procedures (number) 12 12.5 12.5 7.00 (Denmark) Time (days) 197 154.6 154.6 27.5 (Korea, Rep.) Cost (% of warehouse value) 0.5 1.6 1.6 0.10 (5 Economies) Building quality control index (0-15) 11.0 11.4 11.4 15.00 (3 Economies) Figure – Dealing with Construction Permits in Japan and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 84.39: Australia (Rank: 6) 77.74: Korea, Rep. (Rank: 28) 75.77: United States (Rank: 36) 73.36: Tokyo Note: The ranking of economies on the ease of dealing with construction permits is determined by sorting their distance to frontier scores for dealing with construction permits. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Dealing with Construction Permits in Tokyo – Procedure, Time and Cost Time Cost 0.25 0.2 Cost (% of warehouse value) 150 Time (days) 0.15 100 0.1 50 0.05 0 0 1 *2 3 *4 5 6 7 8 9 10 11 12 Page 18   component indicators. Doing Business 2018 Japan Figure – Dealing with Construction Permits in Tokyo – Procedure, Time and Cost Time Cost 0.25 0.2 Cost (% of warehouse value) 150 Time (days) 0.15 100 0.1 50 0.05 0 0 1 *2 3 *4 5 6 7 8 9 10 11 12 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Figure – Dealing with Construction Permits in Tokyo and comparator economies – Measure of Quality 16 14.0 14 12 11.0 11.4 10.0 Index score 10 8.0 8 6 4 2 0 Tokyo Australia Korea, Rep. United States OECD high income Details – Dealing with Construction Permits in Tokyo – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Obtain consent of neighborhood 30 days no charge Agency : Local Authority Obtaining neighborhood consent can be carried out simultaneously with the previous procedure. The initial step is to post a sign with speci c information about the planned construction on the plot. Thereafter, BuildCo must obtain the endorsement of all neighbors (companies) stating that they do not object to the construction of the warehouse. 2 Hold initial consultation with local authority 24 days no charge Agency : Local Authority BuildCo must have clearance at the initial consultation phase with at least 14 Page 19   Tokyo Australia Korea, Rep. United States OECD high income Doing Business 2018 Japan Details – Dealing with Construction Permits in Tokyo – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Obtain consent of neighborhood 30 days no charge Agency : Local Authority Obtaining neighborhood consent can be carried out simultaneously with the previous procedure. The initial step is to post a sign with speci c information about the planned construction on the plot. Thereafter, BuildCo must obtain the endorsement of all neighbors (companies) stating that they do not object to the construction of the warehouse. 2 Hold initial consultation with local authority 24 days no charge Agency : Local Authority BuildCo must have clearance at the initial consultation phase with at least 14 di erent departments at the prefecture level. Due to stricter requirements of compliance with construction regulations, the process now takes around 24 days. The purpose of this consultation is to avoid the risk of resubmitting the application for the actual building permit which if submitted wrongly, or some parts require alteration, the process can take another 2 -- 3 months. Closer scrutiny is paid to the structural component of the drawings and plans. The rules require an engineer to resubmit an entire construction plan, even to change a peg or location of windows. 3 Obtain building permit from Japan Building Center 70 days JPY 225,000 Agency : Japan Building Center After the initial consultation with the local authority, BuildCo must submit a building permit application. The local authority examines the application and issues the building permit. Normally, architects submit the application on behalf of their clients. The Fire O ce is also involved in the permit examination process. The application must be amended when any changes are made after the building permit is obtained. In addition, a change permit must be obtained prior to nal inspection by local authorities. After the falsi cation of structural calculation of buildings by former Architect Aneha became public knowledge in November 2005, many Japanese local authorities and private inspection companies have had to spend extra time checking structural design documents in new applications. This situation is still very much true in many parts of Japan. There is also a spill-over e ect on site inspections by privatized control institutions, and it is likely that the Japanese government will introduce more frequent and thorough inspection procedures in building construction in the near future. Building permit review and approval procedures became very stringent since the new Building regulation as of June 20, 2007. As of June 2007 any project exceeding 1,000 sq. m. will require a peer review process by an independent authorized structural engineer/agency. The engineers are generally hired by the Building Department to undertake this review. However, the amount of work and backlog on one hand and the number of available professionals on the other hand willing to work extra hours on the weekends has caused delays. The peer review may take about 30 days in addition to the 50 days of building permit review period. In simpler cases the process may take on average 70 days. Page 20   4 Request and obtain workmen’s compensation insurance proof from 60 days no charge plans. The rules require an engineer to resubmit an entire construction plan, Doing even to change Business 2018 or location of windows. a pegJapan 3 Obtain building permit from Japan Building Center 70 days JPY 225,000 Agency : Japan Building Center After the initial consultation with the local authority, BuildCo must submit a building permit application. The local authority examines the application and issues the building permit. Normally, architects submit the application on behalf of their clients. The Fire O ce is also involved in the permit examination process. The application must be amended when any changes are made after the building permit is obtained. In addition, a change permit must be obtained prior to nal inspection by local authorities. After the falsi cation of structural calculation of buildings by former Architect Aneha became public knowledge in November 2005, many Japanese local authorities and private inspection companies have had to spend extra time checking structural design documents in new applications. This situation is still very much true in many parts of Japan. There is also a spill-over e ect on site inspections by privatized control institutions, and it is likely that the Japanese government will introduce more frequent and thorough inspection procedures in building construction in the near future. Building permit review and approval procedures became very stringent since the new Building regulation as of June 20, 2007. As of June 2007 any project exceeding 1,000 sq. m. will require a peer review process by an independent authorized structural engineer/agency. The engineers are generally hired by the Building Department to undertake this review. However, the amount of work and backlog on one hand and the number of available professionals on the other hand willing to work extra hours on the weekends has caused delays. The peer review may take about 30 days in addition to the 50 days of building permit review period. In simpler cases the process may take on average 70 days. 4 Request and obtain workmen’s compensation insurance proof from 60 days no charge Labor Control O ce Agency : Labor Control O ce The Labor Control O ce veri es worker compensation insurance for all companies annually. No cost is incurred for obtaining con rmation. Once a contractor obtains con rmation and insurance, it is valid for one year for any project of the contractor’s company. Application for worker compensation insurance is made with the local labor control o ce. The applicant must comply with the registration criteria. A worker compensation insurance fee must be paid within 50 days after the application is led. Worker compensation insurance is valid for a year, and it must be extended every year between April 1 and May 20. The insurance cost is 2.05% of the company's total personnel costs (1.25% paid by employer, 0.8% paid by employee). 5 Purchase and post statutory construction notice sign board 1 day JPY 50,000 Agency : Local Authority The construction notice sign board should include the following information: • Construction company registry certi cate number • Proof of worker compensation insurance • Building permit number • Name of client, designer, contractor, project name, address, the person in charge, etc. 6 Submit construction method plan to local authority and obtain 7 days no charge Page 21   approval • Name of client, designer, contractor, project name, address, the person in Doing charge, etc. 2018 Business Japan 6 Submit construction method plan to local authority and obtain 7 days no charge approval Agency : Local Authority The construction method plan is submitted to the local authority for a crosscheck with the project drawings and to ll out the necessary application form. 7 Submit project safety and health and resources recycling plan to local 7 days no charge authority and obtain approval Agency : Local Authority The design drawings, construction schedule, method statement, and building permit are required for this application. The application must be submitted 7 days before construction work starts. 8 Receive intermediate inspection by Japan Building Center and obtain 24 days JPY 211,000 permit Agency : Japan Building Center The Japan Building Center (a privatized building control institution) and the Fire O ce inspect structural conditions and conduct new building position surveys when the construction is half-completed. The inspection usually takes one day and construction work can continue if there are no serious irregularities. However, if there are any mistakes, construction work is suspended until proper measures are taken. An intermediate building permit is issued within 2 to 3 weeks. 9 Request and receive connection to water and sewage services 21 days no charge Agency : Tokyo Water Company The installation cost is included in water and sewerage charges. 10 Request and receive nal inspection from Japan Building Center 7 days JPY 220,000 Agency : Japan Building Center BuildCo requests the inspection. After the completion of the inspection, the certi cate is issued within 3 business days. If there are any outstanding issues pointed out by inspectors, remedial work must be completed and the building re-inspected before the completion certi cate is issued. The completion certi cate is required to start occupying and using the building. This certi cate is distinct from the land and building registration with the local authorities, and can be issued by the local authorities or by any of the authorized institutions at a very similar cost. 11 Obtain completion certi cate 18 days no charge Agency : Japan Building Center 12 Register the building with the Land and Building Registry 12 days JPY 437,451 Agency : Land and Building Registry The building registration involves two steps. First, the description of the building should be registered (usually through a notary public). This part cannot be done by BuildCo or its lawyer. No formal registration cost is required. Second, proof of building ownership should be registered. It takes about 10 to 14 days for the registration to be completed. The cost of proof of building ownership registration varies depending on the value of the building (0.2% of Page 22   the building’s taxable value). 11 Obtain completion certi cate 18 days no charge Agency : Japan Building Center Doing Business 2018 Japan 12 Register the building with the Land and Building Registry 12 days JPY 437,451 Agency : Land and Building Registry The building registration involves two steps. First, the description of the building should be registered (usually through a notary public). This part cannot be done by BuildCo or its lawyer. No formal registration cost is required. Second, proof of building ownership should be registered. It takes about 10 to 14 days for the registration to be completed. The cost of proof of building ownership registration varies depending on the value of the building (0.2% of the building’s taxable value). Takes place simultaneously with previous procedure. Details – Dealing with Construction Permits in Tokyo – Measure of Quality Answer Score Building quality control index (0-15) 11.0 Quality of building regulations index (0-2) 2.0 How accessible are building laws and regulations in your economy? (0-1) Available online; 1.0 Free of charge. Which requirements for obtaining a building permit are clearly speci ed in the building List of required 1.0 regulations or on any accessible website, brochure or pamphlet? (0-1) documents; Fees to be paid; Required preapprovals. Quality control before construction index (0-1) 1.0 Which third-party entities are required by law to verify that the building plans are in Licensed 1.0 compliance with existing building regulations? (0-1) architect; Licensed engineer. Quality control during construction index (0-3) 2.0 What types of inspections (if any) are required by law to be carried out during Inspections by 1.0 construction? (0-2) external engineer or rm; Inspections at various phases. Do legally mandated inspections occur in practice during construction? (0-1) Mandatory 1.0 inspections are always done in practice. Quality control after construction index (0-3) 3.0 Is there a nal inspection required by law to verify that the building was built in Yes, nal 2.0 accordance with the approved plans and regulations? (0-2) inspection is done by government Page 23   agency; Yes, in- Takes place simultaneously with previous procedure. Doing Business 2018 Japan Details – Dealing with Construction Permits in Tokyo – Measure of Quality Answer Score Building quality control index (0-15) 11.0 Quality of building regulations index (0-2) 2.0 How accessible are building laws and regulations in your economy? (0-1) Available online; 1.0 Free of charge. Which requirements for obtaining a building permit are clearly speci ed in the building List of required 1.0 regulations or on any accessible website, brochure or pamphlet? (0-1) documents; Fees to be paid; Required preapprovals. Quality control before construction index (0-1) 1.0 Which third-party entities are required by law to verify that the building plans are in Licensed 1.0 compliance with existing building regulations? (0-1) architect; Licensed engineer. Quality control during construction index (0-3) 2.0 What types of inspections (if any) are required by law to be carried out during Inspections by 1.0 construction? (0-2) external engineer or rm; Inspections at various phases. Do legally mandated inspections occur in practice during construction? (0-1) Mandatory 1.0 inspections are always done in practice. Quality control after construction index (0-3) 3.0 Is there a nal inspection required by law to verify that the building was built in Yes, nal 2.0 accordance with the approved plans and regulations? (0-2) inspection is done by government agency; Yes, in- house engineer submits report for nal inspection; Yes, external engineer submits report for nal inspection. Do legally mandated nal inspections occur in practice? (0-1) Final inspection 1.0 always occurs in practice. Liability and insurance regimes index (0-2) 1.0 Page 24   always occurs in Doing Business 2018 Japan practice. Liability and insurance regimes index (0-2) 1.0 Which parties (if any) are held liable by law for structural aws or problems in the Architect or 1.0 building once it is in use (Latent Defect Liability or Decennial Liability)? (0-1) engineer; Construction company; Owner or investor. Which parties (if any) are required by law to obtain an insurance policy to cover No party is 0.0 possible structural aws or problems in the building once it is in use (Latent Defect required by law Liability Insurance or Decennial Insurance)? (0-1) to obtain insurance . Professional certi cations index (0-4) 2.0 What are the quali cation requirements for the professional responsible for verifying Minimum 2.0 that the architectural plans or drawings are in compliance with existing building number of years regulations? (0-2) of experience; University degree in architecture or engineering; Being a registered architect or engineer. What are the quali cation requirements for the professional who supervises the Minimum 0.0 construction on the ground? (0-2) number of years of experience; Being a registered architect or engineer; Passing a certi cation exam. Dealing with Construction Permits - Osaka Standardized Warehouse Estimated value of warehouse JPY 218,725,345.10 City Covered Osaka OECD high OECD high Indicator Osaka income income Overall Best Performer Procedures (number) 12 12.5 12.5 7.00 (Denmark) Time (days) 197 154.6 154.6 27.5 (Korea, Rep.) Cost (% of warehouse value) 0.5 1.6 1.6 0.10 (5 Economies) Building quality control index (0-15) 11.0 11.4 11.4 15.00 (3 Economies) Page 25   certi cation exam. Doing Business 2018 Japan Dealing with Construction Permits - Osaka Standardized Warehouse Estimated value of warehouse JPY 218,725,345.10 City Covered Osaka OECD high OECD high Indicator Osaka income income Overall Best Performer Procedures (number) 12 12.5 12.5 7.00 (Denmark) Time (days) 197 154.6 154.6 27.5 (Korea, Rep.) Cost (% of warehouse value) 0.5 1.6 1.6 0.10 (5 Economies) Building quality control index (0-15) 11.0 11.4 11.4 15.00 (3 Economies) Figure – Dealing with Construction Permits in Japan and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 84.39: Australia (Rank: 6) 77.74: Korea, Rep. (Rank: 28) 75.77: United States (Rank: 36) 73.36: Osaka Note: The ranking of economies on the ease of dealing with construction permits is determined by sorting their distance to frontier scores for dealing with construction permits. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Dealing with Construction Permits in Osaka – Procedure, Time and Cost Time Cost 0.25 0.2 Cost (% of warehouse value) 150 Time (days) 0.15 100 0.1 50 0.05 Page 26   0 0 component indicators. Doing Business 2018 Japan Figure – Dealing with Construction Permits in Osaka – Procedure, Time and Cost Time Cost 0.25 0.2 Cost (% of warehouse value) 150 Time (days) 0.15 100 0.1 50 0.05 0 0 1 *2 3 *4 5 6 7 8 9 10 11 12 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Figure – Dealing with Construction Permits in Osaka and comparator economies – Measure of Quality 16 14.0 14 12 11.0 11.4 10.0 Index score 10 8.0 8 6 4 2 0 Osaka Australia Korea, Rep. United States OECD high income Details – Dealing with Construction Permits in Osaka – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Obtain consent of neighborhood 30 days no charge Agency : Local Authority Obtaining neighborhood consent can be carried out simultaneously with the previous procedure. The initial step is to post a sign with speci c information about the planned construction on the plot. Thereafter, BuildCo must obtain the endorsement of all neighbors (companies) stating that they do not object to the construction of the warehouse. 2 Hold initial consultation with local authority 24 days no charge Agency : Local Authority BuildCo must have clearance at the initial consultation phase with at least 14 Page 27   Osaka Australia Korea, Rep. United States OECD high income Doing Business 2018 Japan Details – Dealing with Construction Permits in Osaka – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Obtain consent of neighborhood 30 days no charge Agency : Local Authority Obtaining neighborhood consent can be carried out simultaneously with the previous procedure. The initial step is to post a sign with speci c information about the planned construction on the plot. Thereafter, BuildCo must obtain the endorsement of all neighbors (companies) stating that they do not object to the construction of the warehouse. 2 Hold initial consultation with local authority 24 days no charge Agency : Local Authority BuildCo must have clearance at the initial consultation phase with at least 14 di erent departments at the prefecture level. Due to stricter requirements of compliance with construction regulations, the process now takes around 24 days. The purpose of this consultation is to avoid the risk of resubmitting the application for the actual building permit which if submitted wrongly, or some parts require alteration, the process can take another 2 -- 3 months. Closer scrutiny is paid to the structural component of the drawings and plans. The rules require an engineer to resubmit an entire construction plan, even to change a peg or location of windows. 3 Obtain building permit from Japan Building Center 70 days JPY 225,000 Agency : Japan Building Center After the initial consultation with the local authority, BuildCo must submit a building permit application. The local authority examines the application and issues the building permit. 4 Request and obtain workmen’s compensation insurance proof from 60 days no charge Labor Control O ce Agency : Labor Control O ce The Labor Control O ce veri es worker compensation insurance for all companies annually. No cost is incurred for obtaining con rmation. Once a contractor obtains con rmation and insurance, it is valid for one year for any project of the contractor’s company. Application for worker compensation insurance is made with the local labor control o ce. The applicant must comply with the registration criteria. A worker compensation insurance fee must be paid within 50 days after the application is led. Worker compensation insurance is valid for a year, and it must be extended every year between April 1 and May 20. The insurance cost is 2.05% of the company's total personnel costs (1.25% paid by employer, 0.8% paid by employee). 5 Purchase and post statutory construction notice sign board 1 day JPY 50,000 Agency : Local Authority Article 89 of the Building Standard Law stipulates that the Contractor must post a sign board on the construction site indicating the names or trade names of the building owner, designer, executor of construction work and eld manager and the construction permit number. This sign board notice must be easily visible a t all time. The government agency may check the erected sign boards when construction works started. Page 28   6 Submit construction method plan to local authority and obtain 7 days no charge company's total personnel costs (1.25% paid by employer, 0.8% paid by Doing employee). Business 2018 Japan 5 Purchase and post statutory construction notice sign board 1 day JPY 50,000 Agency : Local Authority Article 89 of the Building Standard Law stipulates that the Contractor must post a sign board on the construction site indicating the names or trade names of the building owner, designer, executor of construction work and eld manager and the construction permit number. This sign board notice must be easily visible a t all time. The government agency may check the erected sign boards when construction works started. 6 Submit construction method plan to local authority and obtain 7 days no charge approval Agency : Local Authority The construction method plan is submitted to the local authority for a crosscheck with the project drawings and to ll out the necessary application form. 7 Submit project safety and health and resources recycling plan to local 7 days no charge authority and obtain approval Agency : Local Authority The design drawings, construction schedule, method statement, and building permit are required for this application. The application must be submitted 7 days before construction work starts. 8 Receive intermediate inspection by Japan Building Center and obtain 24 days JPY 211,000 permit Agency : Japan Building Center The Japan Building Center (a privatized building control institution) and the Fire O ce inspect structural conditions and conduct new building position surveys when the construction is half-completed. The inspection usually takes one day and construction work can continue if there are no serious irregularities. However, if there are any mistakes, construction work is suspended until proper measures are taken. An intermediate building permit is issued within 2 to 3 weeks. 9 Request and receive connection to water and sewage services 21 days no charge Agency : Osaka City Water The installation cost is included in water and sewerage charges. 10 Request and receive nal inspection from Japan Building Center 7 days JPY 220,000 Agency : Japan Building Center BuildCo requests the inspection. After the completion of the inspection, the certi cate is issued within 3 business days. If there are any outstanding issues pointed out by inspectors, remedial work must be completed and the building re-inspected before the completion certi cate is issued. The completion certi cate is required to start occupying and using the building. This certi cate is distinct from the land and building registration with the local authorities, and can be issued by the local authorities or by any of the authorized institutions at a very similar cost. 11 Obtain completion certi cate 18 days no charge Agency : Japan Building Center 12 Register the building with the Land and Building Registry 12 days JPY 437,451 Page 29   11 Obtain completion certi cate 18 days no charge Agency : Japan Building Center Doing Business 2018 Japan 12 Register the building with the Land and Building Registry 12 days JPY 437,451 Agency : Land and Building Registry The building registration involves two steps. First, the description of the building should be registered (usually through a notary public). This part cannot be done by BuildCo or its lawyer. No formal registration cost is required. Second, proof of building ownership should be registered. It takes about 10 to 14 days for the registration to be completed. The cost of proof of building ownership registration varies depending on the value of the building (0.2% of the building’s taxable value). Takes place simultaneously with previous procedure. Details – Dealing with Construction Permits in Osaka – Measure of Quality Answer Score Building quality control index (0-15) 11.0 Quality of building regulations index (0-2) 2.0 How accessible are building laws and regulations in your economy? (0-1) Available online; 1.0 Free of charge. Which requirements for obtaining a building permit are clearly speci ed in the building List of required 1.0 regulations or on any accessible website, brochure or pamphlet? (0-1) documents; Fees to be paid; Required preapprovals. Quality control before construction index (0-1) 1.0 Which third-party entities are required by law to verify that the building plans are in Licensed 1.0 compliance with existing building regulations? (0-1) architect; Licensed engineer. Quality control during construction index (0-3) 2.0 What types of inspections (if any) are required by law to be carried out during Inspections at 1.0 construction? (0-2) various phases. Do legally mandated inspections occur in practice during construction? (0-1) Mandatory 1.0 inspections are always done in practice. Quality control after construction index (0-3) 3.0 Is there a nal inspection required by law to verify that the building was built in Yes, nal 2.0 accordance with the approved plans and regulations? (0-2) inspection is done by government agency; Yes, in- house engineer submits report Page 30   for nal Takes place simultaneously with previous procedure. Doing Business 2018 Japan Details – Dealing with Construction Permits in Osaka – Measure of Quality Answer Score Building quality control index (0-15) 11.0 Quality of building regulations index (0-2) 2.0 How accessible are building laws and regulations in your economy? (0-1) Available online; 1.0 Free of charge. Which requirements for obtaining a building permit are clearly speci ed in the building List of required 1.0 regulations or on any accessible website, brochure or pamphlet? (0-1) documents; Fees to be paid; Required preapprovals. Quality control before construction index (0-1) 1.0 Which third-party entities are required by law to verify that the building plans are in Licensed 1.0 compliance with existing building regulations? (0-1) architect; Licensed engineer. Quality control during construction index (0-3) 2.0 What types of inspections (if any) are required by law to be carried out during Inspections at 1.0 construction? (0-2) various phases. Do legally mandated inspections occur in practice during construction? (0-1) Mandatory 1.0 inspections are always done in practice. Quality control after construction index (0-3) 3.0 Is there a nal inspection required by law to verify that the building was built in Yes, nal 2.0 accordance with the approved plans and regulations? (0-2) inspection is done by government agency; Yes, in- house engineer submits report for nal inspection; Yes, external engineer submits report for nal inspection. Do legally mandated nal inspections occur in practice? (0-1) Final inspection 1.0 always occurs in practice. Liability and insurance regimes index (0-2) 1.0 Which parties (if any) are held liable by law for structural aws or problems in the Architect or 1.0 building once it is in use (Latent Defect Liability or Decennial Liability)? (0-1) engineer; Page 31   Construction Liability Doing 2018 regimes and insurance Business Japanindex (0-2) 1.0 Which parties (if any) are held liable by law for structural aws or problems in the Architect or 1.0 building once it is in use (Latent Defect Liability or Decennial Liability)? (0-1) engineer; Construction company; Owner or investor. Which parties (if any) are required by law to obtain an insurance policy to cover No party is 0.0 possible structural aws or problems in the building once it is in use (Latent Defect required by law Liability Insurance or Decennial Insurance)? (0-1) to obtain insurance . Professional certi cations index (0-4) 2.0 What are the quali cation requirements for the professional responsible for verifying Minimum 2.0 that the architectural plans or drawings are in compliance with existing building number of years regulations? (0-2) of experience; University degree in architecture or engineering; Being a registered architect or engineer. What are the quali cation requirements for the professional who supervises the Minimum 0.0 construction on the ground? (0-2) number of years of experience; Being a registered architect or engineer; Passing a certi cation exam. Getting Electricity This topic measures the procedures, time and cost required for a business to obtain a permanent electricity connection for a newly Page 32   certi cation exam. Doing Business 2018 Japan Getting Electricity This topic measures the procedures, time and cost required for a business to obtain a permanent electricity connection for a newly constructed warehouse. Additionally, the reliability of supply and transparency of tari s index measures reliability of supply, transparency of tari s and the price of electricity. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Procedures to obtain an electricity connection To make the data comparable across economies, several assumptions are (number) used. Submitting all relevant documents and obtaining The warehouse: all necessary clearances and permits - Is owned by a local entrepreneur and is used for storage of goods. Completing all required notifications and - Is located in the economy’s largest business city. For 11 economies the receiving all necessary inspections data are also collected for the second largest business city. Obtaining external installation works and possibly - Is located in an area where similar warehouses are typically located and is purchasing material for these works in an area with no physical constraints. For example, the property is not Concluding any necessary supply contract and near a railway. obtaining final supply - Is a new construction and is being connected to electricity for the rst time. Time required to complete each procedure - Has two stories with a total surface area of approximately 1,300.6 square (calendar days) meters (14,000 square feet). The plot of land on which it is built is 929 Is at least 1 calendar day square meters (10,000 square feet). Each procedure starts on a separate day Does not include time spent gathering The electricity connection: information - Is a permanent one with a three-phase, four-wire Y connection with a subscribed capacity of 140-kilo-volt-ampere (kVA) with a power factor of 1, Reflects the time spent in practice, with little when 1 kVA = 1 kilowatt (kW). follow-up and no prior contact with officials - Has a length of 150 meters. The connection is to either the low- or Cost required to complete each procedure (% of medium-voltage distribution network and is either overhead or income per capita) underground, whichever is more common in the area where the Official costs only, no bribes warehouse is located and requires works that involve the crossing of a 10- meter road (such as by excavation or overhead lines) but are all carried out Value added tax excluded on public land. There is no crossing of other owners’ private property The reliability of supply and transparency of because the warehouse has access to a road. tari s index (0-8) - Does not require work to install the internal wiring of the warehouse. This has already been completed up to and including the customer’s service Duration and frequency of power outages (0–3) panel or switchboard and the meter base. Tools to monitor power outages (0–1) Tools to restore power supply (0–1) The monthly consumption: Regulatory monitoring of utilities’ performance - It is assumed that the warehouse operates 30 days a month from 9:00 (0–1) a.m. to 5:00 p.m. (8 hours a day), with equipment utilized at 80% of capacity Financial deterrents limiting outages (0–1) on average and that there are no electricity cuts (assumed for simplicity reasons) and the monthly energy consumption is 26,880 kilowatt-hours Transparency and accessibility of tariffs (0–1) (kWh); hourly consumption is 112 kWh. Price of electricity (cents per kilowatt-hour)* - If multiple electricity suppliers exist, the warehouse is served by the Price based on monthly bill for commercial cheapest supplier. warehouse in case study - Tari s e ective in March of the current year are used for calculation of the price of electricity for the warehouse. Although March has 31 days, for * N o t e : Doing Business m e a s u r e s t h e p r i c e o f calculation purposes only 30 days are used. electricity, but it is not included in the distance to frontier score nor the ranking on the ease of getting electricity. Page 33   Getting Electricity - Tokyo frontier score nor the ranking on the ease of getting electricity. Doing Business 2018 Japan Getting Electricity - Tokyo Standardized Connection Price of electricity (US cents per kWh) 23.3 Name of utility Tokyo Electric Power Company (TEPCO) City Covered Tokyo OECD high OECD high Indicator Tokyo income income Overall Best Performer Procedures (number) 3 4.7 4.7 2 (United Arab Emirates) Time (days) 105 79.1 79.1 10 (United Arab Emirates) Cost (% of income per capita) 0 63.0 63.0 0.00 (Japan) Reliability of supply and transparency of tariff 8 7.4 7.4 8.00 (28 Economies) index (0-8) Figure – Getting Electricity in Japan and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 99.89: Korea, Rep. (Rank: 2) 90.54: Tokyo 82.31: Australia (Rank: 47) 82.14: United States (Rank: 49) Note: The ranking of economies on the ease of getting electricity is determined by sorting their distance to frontier scores for getting electricity. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Getting Electricity in Tokyo – Procedure, Time and Cost Time Cost 1.2 100 1 (% of income per capita) 80 0.8 Time (days) 60 0.6 40 Page 34   0.4 getting electricity. These scores are the simple average of the distance to frontier scores for each of the component indicators. Doing Business 2018 Japan Figure – Getting Electricity in Tokyo – Procedure, Time and Cost Time Cost 1.2 100 1 Cost (% of income per capita) 80 0.8 Time (days) 60 0.6 40 0.4 20 0.2 0 0 1 2 3 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Figure – Getting Electricity in Tokyo and comparator economies – Measure of Quality 8.2 8 8 8 7.8 7.6 Index score 7.4 7.4 7.2 7.2 7 7 6.8 6.6 6.4 Tokyo Australia Korea, Rep. United States OECD high income Details – Getting Electricity in Tokyo – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Consult with Tepco on timing for external works and contract 1 calendar day JPY 0 Agency : Tepco A discussion between the customer and TEPCO to decide on the actual construction date and the e ective date of the contract takes place. The design team of the warehouse project will initially have a discussion with TEPCO regarding the project outline, construction period and basic requirements for power supply and connection. 2 Submit application to Tepco and await external connection works 93 calendar days JPY 0 Agency : Tepco Required documents for the application are single-line diagram, a lay-out of Page 35   Tokyo Australia Korea, Rep. United States OECD high income Doing Business 2018 Japan Details – Getting Electricity in Tokyo – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Consult with Tepco on timing for external works and contract 1 calendar day JPY 0 Agency : Tepco A discussion between the customer and TEPCO to decide on the actual construction date and the e ective date of the contract takes place. The design team of the warehouse project will initially have a discussion with TEPCO regarding the project outline, construction period and basic requirements for power supply and connection. 2 Submit application to Tepco and await external connection works 93 calendar days JPY 0 Agency : Tepco Required documents for the application are single-line diagram, a lay-out of premise, harmonic calculation documents and application form. There is no external inspection. As there is no inspection of the internal wiring, TEPCO is asking the customer for the necessary information regarding the licensed electrician who did the internal wiring. Japanese laws require every owner/user to hire a licensed electrician to install the wiring. The information is submitted on the formatted application document and contains the name, license number and contact information of the electrician. There is no notarization needed for the documents, however the signature of the customer needs to be on the documents when applying online. The contractor building the warehouse will usually make an application for power supply and connection several months before the required date of the connection to allow TEPCO su cient time to survey the proposed area in terms of electricity supply route and capacity required for the speci c building. If the electricity main supply is not suitable, TEPCO will carry out necessary infrastructure work to provide the required utility services. There is usually no estimate prior to the determination of the actual contract start date. There is no connection fee: In case of overhead wiring, up to 1000 meters long, construction work does not require any nancial responsibility by the customer. 3 Receive connection works and meter installation by Tepco 11 calendar days JPY 0 Agency : Tepco With this class of customer TEPCO provides electricity on high-voltage (6600V) power line. On the primary side, TEPCO builds an aerial high-voltage service wire with some related equipments such as pole-mounted switches, and on the secondary side of the transformer (usually 200V) it installs a meter at a speci ed location and connects it to the internal wiring system. TEPCO usually executes the external wiring construction and meter installation at the same time. All the material is provided by TEPCO. Takes place simultaneously with previous procedure. Details – Getting Electricity in Tokyo – Measure of Quality Answer Reliability of supply and transparency of tari index (0-8) 8 Total duration and frequency of outages per customer a year (0-3) 3 Page 36   Takes place simultaneously with previous procedure. Doing Business 2018 Japan Details – Getting Electricity in Tokyo – Measure of Quality Answer Reliability of supply and transparency of tari index (0-8) 8 Total duration and frequency of outages per customer a year (0-3) 3 System average interruption duration index (SAIDI) 0.1 System average interruption frequency index (SAIFI) 0.1 What is the minimum outage time (in minutes) that the utility considers for the calculation of SAIDI/SAIFI 1.0 Mechanisms for monitoring outages (0-1) 1 Does the distribution utility use automated tools to monitor outages? Yes Mechanisms for restoring service (0-1) 1 Does the distribution utility use automated tools to restore service? Yes Regulatory monitoring (0-1) 1 Does a regulator—that is, an entity separate from the utility—monitor the utility’s performance on Yes reliability of supply? Financial deterrents aimed at limiting outages (0-1) 1 Does the utility either pay compensation to customers or face nes by the regulator (or both) if outages Yes exceed a certain cap? Communication of tari s and tari changes (0-1) 1 Are e ective tari s available online? Yes Link to the website, if available online http://www.tepco.co. jp/en/customer/guid e/rateinfo-e.html Are customers noti ed of a change in tari ahead of the billing cycle? Yes Note: If the duration and frequency of outages is 100 or less, the economy is eligible to score on the Reliability of supply and transparency of tari index. If the duration and frequency of outages is not available, or is over 100, the economy is not eligible to score on the index. If the minimum outage time considered for SAIDI/SAIFI is over 5 minutes, the economy is not eligible to score on the index. Getting Electricity - Osaka Standardized Connection Price of electricity (US cents per kWh) 18.6 Name of utility The Kansai Electric Power Co., INC.- KEPCO City Covered Osaka Page 37   If the minimum outage time considered for SAIDI/SAIFI is over 5 minutes, the economy is not eligible to score on the index. Doing Business 2018 Japan Getting Electricity - Osaka Standardized Connection Price of electricity (US cents per kWh) 18.6 Name of utility The Kansai Electric Power Co., INC.- KEPCO City Covered Osaka OECD high OECD high Indicator Osaka income income Overall Best Performer Procedures (number) 4 4.7 4.7 2 (United Arab Emirates) Time (days) 84 79.1 79.1 10 (United Arab Emirates) Cost (% of income per capita) 0 63.0 63.0 0.00 (Japan) Reliability of supply and transparency of tariff 8 7.4 7.4 8.00 (28 Economies) index (0-8) Figure – Getting Electricity in Japan and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 99.89: Korea, Rep. (Rank: 2) 88.66: Osaka 82.31: Australia (Rank: 47) 82.14: United States (Rank: 49) Note: The ranking of economies on the ease of getting electricity is determined by sorting their distance to frontier scores for getting electricity. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Getting Electricity in Osaka – Procedure, Time and Cost Time Cost 1.2 80 70 1 (% of income per capita) 60 0.8 Time (days) 50 0.6 40 Page 38   30 0.4 getting electricity. These scores are the simple average of the distance to frontier scores for each of the component indicators. Doing Business 2018 Japan Figure – Getting Electricity in Osaka – Procedure, Time and Cost Time Cost 1.2 80 70 1 Cost (% of income per capita) 60 0.8 Time (days) 50 0.6 40 30 0.4 20 0.2 10 0 0 1 2 *3 4 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Figure – Getting Electricity in Osaka and comparator economies – Measure of Quality 8.2 8 8 8 7.8 7.6 Index score 7.4 7.4 7.2 7.2 7 7 6.8 6.6 6.4 Osaka Australia Korea, Rep. United States OECD high income Details – Getting Electricity in Osaka – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Consult with Kepco on timing for external works and contract 1 calendar day JPY 0 Agency : Kepco The date of the external connection works start will be decided through the consultation between the customer and the electric power company when the customer applied to the electric power company. The internal wiring needs to be done before the external connection works starts. In this discussion, issues regarding the project outline, construction period and basic requirements for power supply and connection will be discussed. 2 Submit application to Kepco and await external connection works 75 calendar days JPY 0 Agency : Kepco Page 39   Osaka Australia Korea, Rep. United States OECD high income Doing Business 2018 Japan Details – Getting Electricity in Osaka – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 Consult with Kepco on timing for external works and contract 1 calendar day JPY 0 Agency : Kepco The date of the external connection works start will be decided through the consultation between the customer and the electric power company when the customer applied to the electric power company. The internal wiring needs to be done before the external connection works starts. In this discussion, issues regarding the project outline, construction period and basic requirements for power supply and connection will be discussed. 2 Submit application to Kepco and await external connection works 75 calendar days JPY 0 Agency : Kepco The application is submitted in person. Required documents for the application are single-line diagram, a lay-out of premise, harmonic calculation documents and application form. There is no external inspection. As there is no inspection of the internal wiring, KEPCO asks the customer for the necessary information regarding the licensed electrician who did the internal wiring. Japanese laws require every owner/user to hire a licensed electrician to install the wiring. The information is submitted on the formatted application document and contains the name, license number and contact information of the electrician. There is no notarization needed for the documents, however the signature of the customer needs to be on the documents when applying online. The contractor building the warehouse will usually make an application for power supply and connection several months before the required date of the connection to allow KEPCO su cient time to survey the proposed area in terms of electricity supply route and capacity required for the speci c building. If the electricity main supply is not suitable, KEPCO will carry out necessary infrastructure work to provide the required utility services. There is usually no estimate prior to the determination of the actual contract start date. There is no connection fee. 3 Receive external site inspection by Kepco for preparing technical study 1 calendar day JPY 0 Agency : Kepco The utility visits the location of the building and conducts external site inspection necessary for preparation of technical study. It is necessary that the customer is present on the plot during this inspection. 4 Receive connection works and meter installation by Kepco 8 calendar days JPY 0 Agency : Kepco With this class of customer KEPCO provides electricity on high-voltage (6600V) power line. On the primary side, KEPCO builds an aerial high-voltage service wire with some related equipment such as pole-mounted switches, and on the secondary side of the transformer (usually 200V) it installs a meter at a speci ed location and connects it to the internal wiring system. KEPCO usually executes the external wiring construction and meter installation at the same time. All the material is provided by KEPCO free of charge because all costs are included in consumption charges. Takes place simultaneously with previous procedure. Page 40   Details – Getting Electricity in Osaka – Measure of Quality Takes place simultaneously with previous procedure. Doing Business 2018 Japan Details – Getting Electricity in Osaka – Measure of Quality Answer Reliability of supply and transparency of tari index (0-8) 8 Total duration and frequency of outages per customer a year (0-3) 3 System average interruption duration index (SAIDI) 0.1 System average interruption frequency index (SAIFI) 0.1 What is the minimum outage time (in minutes) that the utility considers for the calculation of SAIDI/SAIFI 1.0 Mechanisms for monitoring outages (0-1) 1 Does the distribution utility use automated tools to monitor outages? Yes Mechanisms for restoring service (0-1) 1 Does the distribution utility use automated tools to restore service? Yes Regulatory monitoring (0-1) 1 Does a regulator—that is, an entity separate from the utility—monitor the utility’s performance on Yes reliability of supply? Financial deterrents aimed at limiting outages (0-1) 1 Does the utility either pay compensation to customers or face nes by the regulator (or both) if outages Yes exceed a certain cap? Communication of tari s and tari changes (0-1) 1 Are e ective tari s available online? Yes Link to the website, if available online http://www.kepco.co .jp/english/ http://kepco.jp/biz http://kepco.jp/biz/o shirase/ Are customers noti ed of a change in tari ahead of the billing cycle? Yes Note: If the duration and frequency of outages is 100 or less, the economy is eligible to score on the Reliability of supply and transparency of tari index. If the duration and frequency of outages is not available, or is over 100, the economy is not eligible to score on the index. If the minimum outage time considered for SAIDI/SAIFI is over 5 minutes, the economy is not eligible to score on the index. Registering Property This topic examines the steps, time and cost involved in registering property, assuming a standardized case of an entrepreneur who wants to purchase land and a building that is already registered and free of title dispute. In addition, the topic also measures the quality of the land administration system in each economy. The quality of land administration index has ve dimensions: reliability of infrastructure, transparency of information, geographic coverage, land dispute resolution, and equal access to property rights. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. Page 41   Takes place simultaneously with previous procedure. Doing Business 2018 Japan Details – Getting Electricity in Osaka – Measure of Quality Answer Reliability of supply and transparency of tari index (0-8) 8 Total duration and frequency of outages per customer a year (0-3) 3 System average interruption duration index (SAIDI) 0.1 System average interruption frequency index (SAIFI) 0.1 What is the minimum outage time (in minutes) that the utility considers for the calculation of SAIDI/SAIFI 1.0 Mechanisms for monitoring outages (0-1) 1 Does the distribution utility use automated tools to monitor outages? Yes Mechanisms for restoring service (0-1) 1 Does the distribution utility use automated tools to restore service? Yes Regulatory monitoring (0-1) 1 Does a regulator—that is, an entity separate from the utility—monitor the utility’s performance on Yes reliability of supply? Financial deterrents aimed at limiting outages (0-1) 1 Does the utility either pay compensation to customers or face nes by the regulator (or both) if outages Yes exceed a certain cap? Communication of tari s and tari changes (0-1) 1 Are e ective tari s available online? Yes Link to the website, if available online http://www.kepco.co .jp/english/ http://kepco.jp/biz http://kepco.jp/biz/o shirase/ Are customers noti ed of a change in tari ahead of the billing cycle? Yes Note: If the duration and frequency of outages is 100 or less, the economy is eligible to score on the Reliability of supply and transparency of tari index. If the duration and frequency of outages is not available, or is over 100, the economy is not eligible to score on the index. If the minimum outage time considered for SAIDI/SAIFI is over 5 minutes, the economy is not eligible to score on the index. Registering Property This topic examines the steps, time and cost involved in registering property, assuming a standardized case of an entrepreneur who wants to purchase land and a building that is already registered and free of title dispute. In addition, the topic also measures the quality of the land administration system in each economy. The quality of land administration index has ve dimensions: reliability of infrastructure, transparency of information, geographic coverage, land dispute resolution, and equal access to property rights. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. Page 42   If the minimum outage time considered for SAIDI/SAIFI is over 5 minutes, the economy is not eligible to score on the index. Doing Business 2018 Japan Registering Property This topic examines the steps, time and cost involved in registering property, assuming a standardized case of an entrepreneur who wants to purchase land and a building that is already registered and free of title dispute. In addition, the topic also measures the quality of the land administration system in each economy. The quality of land administration index has ve dimensions: reliability of infrastructure, transparency of information, geographic coverage, land dispute resolution, and equal access to property rights. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Procedures to legally transfer title on immovable To make the data comparable across economies, several assumptions property (number) about the parties to the transaction, the property and the procedures are used. Preregistration procedures (for example, checking for liens, notarizing sales agreement, The parties (buyer and seller): paying property transfer taxes) - Are limited liability companies (or the legal equivalent). Registration procedures in the economy's largest - Are located in the periurban area of the economy’s largest business city. business citya. For 11 economies the data are also collected for the second largest Postregistration procedures (for example, filling business city. title with municipality) - Are 100% domestically and privately owned. Time required to complete each procedure - Have 50 employees each, all of whom are nationals. (calendar days) - Perform general commercial activities. Does not include time spent gathering information The property (fully owned by the seller): - Has a value of 50 times income per capita, which equals the sale price. Each procedure starts on a separate day - though - Is fully owned by the seller. procedures that can be fully completed online - Has no mortgages attached and has been under the same ownership for are an exception to this rule the past 10 years. Procedure is considered completed once final - Is registered in the land registry or cadastre, or both, and is free of title document is received disputes. No prior contact with officials - Is located in a periurban commercial zone, and no rezoning is required. Cost required to complete each procedure (% of - Consists of land and a building. The land area is 557.4 square meters property value) (6,000 square feet). A two-story warehouse of 929 square meters (10,000 square feet) is located on the land. The warehouse is 10 years old, is in Official costs only (such as administrative fees, good condition, has no heating system and complies with all safety duties and taxes). standards, building codes and legal requirements. The property, Value Added Tax, Capital Gains Tax and illicit consisting of land and building, will be transferred in its entirety. payments are excluded - Will not be subject to renovations or additional construction following the Quality of land administration index (0-30) purchase. - Has no trees, natural water sources, natural reserves or historical Reliability of infrastructure index (0-8) monuments of any kind. Transparency of information index (0–6) - Will not be used for special purposes, and no special permits, such as for Geographic coverage index (0–8) residential use, industrial plants, waste storage or certain types of agricultural activities, are required. Land dispute resolution index (0–8) - Has no occupants, and no other party holds a legal interest in it. Equal access to property rights index (-2–0) Registering Property - Tokyo Standard Property Transfer Property value JPY 218,725,345.10 Page 43   Doing Business 2018 Japan Registering Property - Tokyo Standard Property Transfer Property value JPY 218,725,345.10 City Covered Tokyo OECD high OECD high Indicator Tokyo income income Overall Best Performer Procedures (number) 6 4.6 4.6 1.00 (4 Economies) Time (days) 13 22.3 22.3 1.00 (3 Economies) Cost (% of property value) 5.8 4.2 4.2 0.00 (5 Economies) Quality of the land administration index (0-30) 24.5 22.7 22.7 29.00 (Singapore) Figure – Registering Property in Japan and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 76.80: United States (Rank: 37) 76.34: Korea, Rep. (Rank: 39) 74.17: Australia (Rank: 51) 73.92: Tokyo Note: The ranking of economies on the ease of registering property is determined by sorting their distance to frontier scores for registering property. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Registering Property in Tokyo – Procedure, Time and Cost Time Cost 4.5 12 4 10 3.5 Cost (% of property value) 3 8 Time (days) 2.5 6 2 1.5 4 1 2 0.5 0 0 1 *2 *3 *4 5 6 Procedures (number) Page 44   registering property. These scores are the simple average of the distance to frontier scores for each of the component indicators. Doing Business 2018 Japan Figure – Registering Property in Tokyo – Procedure, Time and Cost Time Cost 4.5 12 4 10 3.5 Cost (% of property value) 3 8 Time (days) 2.5 6 2 1.5 4 1 2 0.5 0 0 1 *2 *3 *4 5 6 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Figure – Registering Property in Tokyo and comparator economies – Measure of Quality 30 27.5 24.5 25 22.7 20.0 20 Index score 17.6 15 10 5 0 Tokyo Australia Korea, Rep. United States OECD high income Details – Registering Property in Tokyo – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 The seller obtains a certi cate of evaluation for xed asset tax of the 1 day JPY 400 for land + JPY real property at a local tax o ce (simultaneous with 400 for building Agency : Local Tax O ce Procedures 2, 3, and 4) The seller must obtain a certi cate of evaluation for xed asset tax of the real property before the registration application. This should be obtained for the transaction because such certi cate must show the most updated evaluation and will be used later to calculate taxes to be paid. It can be obtained from a relevant local tax o ce, which governs the relevant real estate. The cost of the issuance is JYP 400 for land and JPY 400 for building. 2 Obtain stamps for stamp duty at a post o ce 1 day JPY 80,000 Page 45   Agency : Post O ce (simultaneous with Tokyo Australia Korea, Rep. United States OECD high income Doing Business 2018 Japan Details – Registering Property in Tokyo – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 The seller obtains a certi cate of evaluation for xed asset tax of the 1 day JPY 400 for land + JPY real property at a local tax o ce (simultaneous with 400 for building Agency : Local Tax O ce Procedures 2, 3, and 4) The seller must obtain a certi cate of evaluation for xed asset tax of the real property before the registration application. This should be obtained for the transaction because such certi cate must show the most updated evaluation and will be used later to calculate taxes to be paid. It can be obtained from a relevant local tax o ce, which governs the relevant real estate. The cost of the issuance is JYP 400 for land and JPY 400 for building. 2 Obtain stamps for stamp duty at a post o ce 1 day JPY 80,000 Agency : Post O ce (simultaneous with Procedures 1, 2, Stamps for stamp duty can be purchased at various places, such as post and 4) o ces. Stamp is the sole o cial cost for execution of the sale agreement, if a written agreement is prepared. The preparation and execution of a written sale agreement is not necessary. Even an oral agreement is acceptable for transferring the title to the real estate, although usually a written agreement is prepared. 3 Obtain a corporate registry certi cate Less than a day JPY 480 each copy Agency : Legal A airs Bureau (online procedure online simultaneous with The parties (as companies) must obtain a corporate registry certi cate that Procedures 1, 2, must be issued within 3 months before the registration application. It can be and 4) obtained from a relevant registry o ce of a corporate registry at which the party is registered. The cost is JPY 600 per copy, JPY 480 if obtained online. 4 Obtain a certi cate of Seller's seal impression (inkan shomei) Less than a day JPY 390 for each Agency : Legal A airs Bureau (online procedure online copy simultaneous with Seller must obtain a certi cate of its seal impression for the seal used for Procedures 1, 2, execution of the registration documents, which must be issued within 3 and 3) months before the registration application. It can be obtained from the Legal A airs Bureau (homukyoku). 5 File an application at the Legal A airs Bureau 7-10 days 2% of building value Agency : Legal A airs Bureau + 1.5% of land value evaluated for fixed The parties le an application for registration at the Legal A airs Bureau. The asset tax Legal A airs Bureau will register the title under the name of the new owner. (registration and license tax) A registration and license tax must be paid at the Legal A airs Bureau at the amount of 2% of building value plus 1.5 % of land value. As registration is a requirement for perfection vis-à-vis third parties, reviewing the certi ed copy of the real property registry is generally su cient for identifying any existing perfected encumbrances over the real property. The parties may apply for registration by themselves. However, because of the complexity of ling, usually they retain a judicial scribe for registration. There is a 5% consumption tax in Japan. Sales or leases of land are exempted. However, if the transaction includes the sale or lease of buildings, Page 46   consumption tax applies only to the price of the building. and 3) months before the registration application. It can be obtained from the Legal Doing A airs Bureau Business (homukyoku). 2018 Japan 5 File an application at the Legal A airs Bureau 7-10 days 2% of building value Agency : Legal A airs Bureau + 1.5% of land value evaluated for fixed The parties le an application for registration at the Legal A airs Bureau. The asset tax Legal A airs Bureau will register the title under the name of the new owner. (registration and license tax) A registration and license tax must be paid at the Legal A airs Bureau at the amount of 2% of building value plus 1.5 % of land value. As registration is a requirement for perfection vis-à-vis third parties, reviewing the certi ed copy of the real property registry is generally su cient for identifying any existing perfected encumbrances over the real property. The parties may apply for registration by themselves. However, because of the complexity of ling, usually they retain a judicial scribe for registration. There is a 5% consumption tax in Japan. Sales or leases of land are exempted. However, if the transaction includes the sale or lease of buildings, consumption tax applies only to the price of the building. The documentation shall include: • Executed original copy of the purchase and sale agreement (alternately a copy of registration application signed by the seller and the buyer) • "Certi cate of registration of seller's title of the real property (toukizumi kenri sho) or registration identi cation code (touki shikibetsu joho) (Already in his possesion)" • Certi cate of corporate registry of the parties (if any of them is a corporation) (obtained in Procedure 1) • Certi cate of the parties’ seal impression (obtained in Procedure 2) • Certi cate of evaluation for xed asset tax of the real property (obtained in Procedure 3) • Power of attorney of the seller (if a judicial scribe applies for the registration on behalf of any of the parties) 6 Payment of the real property acquisition tax 1 day 4% of property price Agency : Local Tax O ce evaluated for fixed asset tax This is a post-closing matter, the purchaser will receive the notice of the real property acquisition tax from the local tax o ce a few months after the registration. The real property acquisition tax must be paid at the local tax o ce. Takes place simultaneously with previous procedure. Details – Registering Property in Tokyo – Measure of Quality Answer Score Quality of the land administration index (0-30) 24.5 Reliability of infrastructure index (0-8) 8.0 Page 47   Takes place simultaneously with previous procedure. Doing Business 2018 Japan Details – Registering Property in Tokyo – Measure of Quality Answer Score Quality of the land administration index (0-30) 24.5 Reliability of infrastructure index (0-8) 8.0 What is the institution in charge of immovable property registration? Legal A airs Bureau In what format are the majority of title or deed records kept in the largest business city Computer/Fully 2.0 —in a paper format or in a computerized format (scanned or fully digital)? digital Is there an electronic database for checking for encumbrances (liens, mortgages, Yes 1.0 restrictions and the like)? Institution in charge of the plans showing legal boundaries in the largest business city: Legal A airs Bureau In what format are the majority of maps of land plots kept in the largest business city— Computer/Fully 2.0 in a paper format or in a computerized format (scanned or fully digital)? digital Is there an electronic database for recording boundaries, checking plans and providing Yes 1.0 cadastral information (geographic information system)? Is the information recorded by the immovable property registration agency and the Single database 1.0 cadastral or mapping agency kept in a single database, in di erent but linked databases or in separate databases? Do the immovable property registration agency and cadastral or mapping agency use Yes 1.0 the same identi cation number for properties? Transparency of information index (0–6) 3.5 Who is able to obtain information on land ownership at the agency in charge of Anyone who 1.0 immovable property registration in the largest business city? pays the o cial fee Is the list of documents that are required to complete any type of property transaction Yes, online 0.5 made publicly available–and if so, how? Link for online access: http://www.moj.g o.jp/MINJI/minji7 2.html https://www.touk i-kyoutaku- online.moj.go.jp/ toukinet/fudosan /fudosan_2.html Is the applicable fee schedule for any property transaction at the agency in charge of Yes, online 0.5 immovable property registration in the largest business city made publicly available– and if so, how? Link for online access: link: https://www.nta. go.jp/taxanswer/i nshi/7191.htm Page 48   immovable property registration in the largest business city made publicly available– and if Doing so, how? 2018 Business Japan Link for online access: link: https://www.nta. go.jp/taxanswer/i nshi/7191.htm Does the agency in charge of immovable property registration commit to delivering a No 0.0 legally binding document that proves property ownership within a speci c time frame– and if so, how does it communicate the service standard? Link for online access: Is there a speci c and separate mechanism for ling complaints about a problem that No 0.0 occurred at the agency in charge of immovable property registration? Contact information: Are there publicly available o cial statistics tracking the number of transactions at the Yes 0.5 immovable property registration agency? Number of property transfers in the largest business city in 2015: 202990.0 Who is able to consult maps of land plots in the largest business city? Anyone who 0.5 pays the o cial fee Is the applicable fee schedule for accessing maps of land plots made publicly available Yes, online 0.5 —and if so, how? Link for online access: http://www.touki- kyoutaku- net.moj.go.jp/ http://www.moj.g o.jp/MINJI/minji7 2.html Does the cadastral or mapping agency commit to delivering an updated map within a No 0.0 speci c time frame—and if so, how does it communicate the service standard? Link for online access: Is there a speci c and separate mechanism for ling complaints about a problem that No 0.0 occurred at the cadastral or mapping agency? Contact information: Geographic coverage index (0–8) 8.0 Are all privately held land plots in the economy formally registered at the immovable Yes 2.0 property registry? Are all privately held land plots in the largest business city formally registered at the Yes 2.0 immovable property registry? Are all privately held land plots in the economy mapped? Yes 2.0 Are all privately held land plots in the largest business city mapped? Yes 2.0 Land dispute resolution index (0–8) 5.0 Does the law require that all property sale transactions be registered at the immovable Yes 1.5 Page 49   property registry to make them opposable to third parties? Land dispute Doing 2018 index resolution Business (0–8) Japan 5.0 Does the law require that all property sale transactions be registered at the immovable Yes 1.5 property registry to make them opposable to third parties? Is the system of immovable property registration subject to a state or private Yes 0.5 guarantee? Is there a speci c compensation mechanism to cover for losses incurred by parties who No 0.0 engaged in good faith in a property transaction based on erroneous information certi ed by the immovable property registry? Does the legal system require a control of legality of the documents necessary for a Yes 0.5 property transaction (e.g., checking the compliance of contracts with requirements of the law)? If yes, who is responsible for checking the legality of the documents? Registrar. Does the legal system require veri cation of the identity of the parties to a property Yes 0.5 transaction? If yes, who is responsible for verifying the identity of the parties? Registrar. Is there a national database to verify the accuracy of identity documents? No 0.0 For a standard land dispute between two local businesses over tenure rights of a District Court property worth 50 times gross national income (GNI) per capita and located in the largest business city, what court would be in charge of the case in the rst instance? How long does it take on average to obtain a decision from the rst-instance court for Between 1 and 2 2.0 such a case (without appeal)? years Are there any statistics on the number of land disputes in the rst instance? No 0.0 Number of land disputes in the largest business city in 2015: Equal access to property rights index (-2–0) 0.0 Do unmarried men and unmarried women have equal ownership rights to property? Yes 0.0 Do married men and married women have equal ownership rights to property? Yes 0.0 Registering Property - Osaka Standard Property Transfer Property value JPY 218,725,345.10 City Covered Osaka OECD high OECD high Indicator Osaka income income Overall Best Performer Procedures (number) 6 4.6 4.6 1.00 (4 Economies) Time (days) 13 22.3 22.3 1.00 (3 Economies) Cost (% of property value) 5.8 4.2 4.2 0.00 (5 Economies) Quality of the land administration index (0-30) 24.5 22.7 22.7 Page 50   29.00 (Singapore) Do married men and married women have equal ownership rights to property? Yes 0.0 Doing Business 2018 Japan Registering Property - Osaka Standard Property Transfer Property value JPY 218,725,345.10 City Covered Osaka OECD high OECD high Indicator Osaka income income Overall Best Performer Procedures (number) 6 4.6 4.6 1.00 (4 Economies) Time (days) 13 22.3 22.3 1.00 (3 Economies) Cost (% of property value) 5.8 4.2 4.2 0.00 (5 Economies) Quality of the land administration index (0-30) 24.5 22.7 22.7 29.00 (Singapore) Figure – Registering Property in Japan and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 76.80: United States (Rank: 37) 76.34: Korea, Rep. (Rank: 39) 74.17: Australia (Rank: 51) 73.92: Osaka Note: The ranking of economies on the ease of registering property is determined by sorting their distance to frontier scores for registering property. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Registering Property in Osaka – Procedure, Time and Cost Time Cost 4.5 12 4 10 3.5 Cost (% of property value) 3 8 Time (days) 2.5 6 2 1.5 4 1 2 0.5 0 0 Page 51   1 *2 *3 *4 5 6 registering property. These scores are the simple average of the distance to frontier scores for each of the component indicators. Doing Business 2018 Japan Figure – Registering Property in Osaka – Procedure, Time and Cost Time Cost 4.5 12 4 10 3.5 Cost (% of property value) 3 8 Time (days) 2.5 6 2 1.5 4 1 2 0.5 0 0 1 *2 *3 *4 5 6 Procedures (number) * This symbol is shown beside procedure numbers that take place simultaneously with the previous procedure. Note: Online procedures account for 0.5 days in the total time calculation. For economies that have a di erent procedure list for men and women, the graph shows the time for women. For more information on methodology, see the Doing Business website (http://www.doingbusiness.org/methodology). For details on the procedures re ected here, see the summary below. Figure – Registering Property in Osaka and comparator economies – Measure of Quality 30 27.5 24.5 25 22.7 20.0 20 Index score 17.6 15 10 5 0 Osaka Australia Korea, Rep. United States OECD high income Details – Registering Property in Osaka – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 The seller obtains a certi cate of evaluation for xed asset tax of the 1 day JPY 400 for land + JPY real property at a local tax o ce (simultaneous with 400 for building Agency : Local Tax O ce Procedures 2, 3 and 4) The seller must obtain a certi cate of evaluation for xed asset tax of the real property before the registration application. This should be obtained for the transaction because such certi cate must show the most updated evaluation and will be used later to calculate taxes to be paid. It can be obtained from a relevant local tax o ce, which governs the relevant real estate. The cost of the issuance is JYP 400 for land and JPY 400 for building. 2 Obtain stamps for stamp duty at a post o ce 1 day JPY 80,000 Page 52   Agency : Post O ce (simultaneous with Osaka Australia Korea, Rep. United States OECD high income Doing Business 2018 Japan Details – Registering Property in Osaka – Procedure, Time and Cost No. Procedure Time to Complete Associated Costs 1 The seller obtains a certi cate of evaluation for xed asset tax of the 1 day JPY 400 for land + JPY real property at a local tax o ce (simultaneous with 400 for building Agency : Local Tax O ce Procedures 2, 3 and 4) The seller must obtain a certi cate of evaluation for xed asset tax of the real property before the registration application. This should be obtained for the transaction because such certi cate must show the most updated evaluation and will be used later to calculate taxes to be paid. It can be obtained from a relevant local tax o ce, which governs the relevant real estate. The cost of the issuance is JYP 400 for land and JPY 400 for building. 2 Obtain stamps for stamp duty at a post o ce 1 day JPY 80,000 Agency : Post O ce (simultaneous with Procedures 1, 3, Stamps for stamp duty can be purchased at various places, such as post and 4) o ces. Stamp is the sole o cial cost for execution of the sale agreement, if a written agreement is prepared. The preparation and execution of a written sale agreement is not necessary. Even an oral agreement is acceptable for transferring the title to the real estate, although usually a written agreement is prepared. 3 Obtain a corporate registry certi cate Less than a day JPY 600 each copy or Agency : Legal A airs Bureau (online procedure JPY 480 each copy and simultaneous online The parties (as companies) must obtain a corporate registry certi cate that with Procedures 1, must be issued within 3 months before the registration application. It can be 2, and 4) obtained from a relevant registry o ce of a corporate registry at which the party is registered. The cost is JPY 600 per copy, JPY 480 if obtained online. 4 Obtain a certi cate of Seller's seal impression (inkan shomei) Less than a JPY 450 each copy JPY Agency : Legal A airs Bureau day(online 390 online procedure and Seller must obtain a certi cate of its seal impression for the seal used for simultaneous with execution of the registration documents, which must be issued within 3 Procedures 1, 2, months before the registration application. It can be obtained from the Legal and 4) A airs Bureau (homukyoku). 5 File an application at the Legal A airs Bureau 7 to 10 days 2% of property value Agency : Legal A airs Bureau + 1.5% of land value evaluated for fixed The parties le an application for registration at the Legal A airs Bureau. The asset tax Legal A airs Bureau will register the title under the name of the new owner. (registration and license tax) A registration and license tax must be paid at the Legal A airs Bureau at the amount of 2% of building value plus 1.5 % of land value. As registration is a requirement for perfection vis-à-vis third parties, reviewing the certi ed copy of the real property registry is generally su cient for identifying any existing perfected encumbrances over the real property. The parties may apply for registration by themselves. However, because of the complexity of ling, usually they retain a judicial scribe for registration. There is a 5% consumption tax in Japan. Sales or leases of land are exempted. However, if the transaction includes the sale or lease of buildings, Page 53   consumption tax applies only to the price of the building. Procedures 1, 2, months before the registration application. It can be obtained from the Legal and 4) Doing A airs Bureau Business (homukyoku). 2018 Japan 5 File an application at the Legal A airs Bureau 7 to 10 days 2% of property value Agency : Legal A airs Bureau + 1.5% of land value evaluated for fixed The parties le an application for registration at the Legal A airs Bureau. The asset tax Legal A airs Bureau will register the title under the name of the new owner. (registration and license tax) A registration and license tax must be paid at the Legal A airs Bureau at the amount of 2% of building value plus 1.5 % of land value. As registration is a requirement for perfection vis-à-vis third parties, reviewing the certi ed copy of the real property registry is generally su cient for identifying any existing perfected encumbrances over the real property. The parties may apply for registration by themselves. However, because of the complexity of ling, usually they retain a judicial scribe for registration. There is a 5% consumption tax in Japan. Sales or leases of land are exempted. However, if the transaction includes the sale or lease of buildings, consumption tax applies only to the price of the building. The documentation shall include: • Executed original copy of the purchase and sale agreement (alternately a copy of registration application signed by the seller and the buyer) • "Certi cate of registration of seller's title of the real property (toukizumi kenri sho) or registration identi cation code (touki shikibetsu joho) (Already in his possesion)" • Certi cate of corporate registry of the parties (if any of them is a corporation) (obtained in Procedure 1) • Certi cate of the parties’ seal impression (obtained in Procedure 2) • Certi cate of evaluation for xed asset tax of the real property (obtained in Procedure 3) • Power of attorney of the seller (if a judicial scribe applies for the registration on behalf of any of the parties) 6 Payment of the real property acquisition tax 1 day 4% of property price Agency : Local Tax O ce evaluated for fixed asset tax This is a post-closing matter, the purchaser will receive the notice of the real property acquisition tax from the local tax o ce a few months after the registration. The real property acquisition tax must be paid at the local tax o ce. Takes place simultaneously with previous procedure. Details – Registering Property in Osaka – Measure of Quality Answer Score Quality of the land administration index (0-30) 24.5 Reliability of infrastructure index (0-8) 8.0 Page 54   Takes place simultaneously with previous procedure. Doing Business 2018 Japan Details – Registering Property in Osaka – Measure of Quality Answer Score Quality of the land administration index (0-30) 24.5 Reliability of infrastructure index (0-8) 8.0 What is the institution in charge of immovable property registration? Legal A airs Bureau In what format are the majority of title or deed records kept in the largest business city Computer/Fully 2.0 —in a paper format or in a computerized format (scanned or fully digital)? digital Is there an electronic database for checking for encumbrances (liens, mortgages, Yes 1.0 restrictions and the like)? Institution in charge of the plans showing legal boundaries in the largest business city: Legal A airs Bureau In what format are the majority of maps of land plots kept in the largest business city— Computer/Fully 2.0 in a paper format or in a computerized format (scanned or fully digital)? digital Is there an electronic database for recording boundaries, checking plans and providing Yes 1.0 cadastral information (geographic information system)? Is the information recorded by the immovable property registration agency and the Single database 1.0 cadastral or mapping agency kept in a single database, in di erent but linked databases or in separate databases? Do the immovable property registration agency and cadastral or mapping agency use Yes 1.0 the same identi cation number for properties? Transparency of information index (0–6) 3.5 Who is able to obtain information on land ownership at the agency in charge of Anyone who 1.0 immovable property registration in the largest business city? pays the o cial fee Is the list of documents that are required to complete any type of property transaction Yes, online 0.5 made publicly available–and if so, how? Link for online access: http://www.moj.g o.jp/MINJI/minji7 2.html https://www.touk i-kyoutaku- online.moj.go.jp/ toukinet/fudosan /fudosan_2.html Is the applicable fee schedule for any property transaction at the agency in charge of Yes, online 0.5 immovable property registration in the largest business city made publicly available– and if so, how? Link for online access: link: https://www.nta. go.jp/taxanswer/i nshi/7191.htm Page 55   immovable property registration in the largest business city made publicly available– and if Doing so, how? 2018 Business Japan Link for online access: link: https://www.nta. go.jp/taxanswer/i nshi/7191.htm Does the agency in charge of immovable property registration commit to delivering a No 0.0 legally binding document that proves property ownership within a speci c time frame– and if so, how does it communicate the service standard? Link for online access: Is there a speci c and separate mechanism for ling complaints about a problem that No 0.0 occurred at the agency in charge of immovable property registration? Contact information: Are there publicly available o cial statistics tracking the number of transactions at the Yes 0.5 immovable property registration agency? Number of property transfers in the largest business city in 2015: 79234.0 Who is able to consult maps of land plots in the largest business city? Anyone who 0.5 pays the o cial fee Is the applicable fee schedule for accessing maps of land plots made publicly available Yes, online 0.5 —and if so, how? Link for online access: http://www.touki- kyoutaku- net.moj.go.jp/ http://www.moj.g o.jp/MINJI/minji7 2.html Does the cadastral or mapping agency commit to delivering an updated map within a No 0.0 speci c time frame—and if so, how does it communicate the service standard? Link for online access: Is there a speci c and separate mechanism for ling complaints about a problem that No 0.0 occurred at the cadastral or mapping agency? Contact information: Geographic coverage index (0–8) 8.0 Are all privately held land plots in the economy formally registered at the immovable Yes 2.0 property registry? Are all privately held land plots in the largest business city formally registered at the Yes 2.0 immovable property registry? Are all privately held land plots in the economy mapped? Yes 2.0 Are all privately held land plots in the largest business city mapped? Yes 2.0 Land dispute resolution index (0–8) 5.0 Does the law require that all property sale transactions be registered at the immovable Yes 1.5 Page 56   property registry to make them opposable to third parties? Land dispute Doing 2018 index resolution Business (0–8) Japan 5.0 Does the law require that all property sale transactions be registered at the immovable Yes 1.5 property registry to make them opposable to third parties? Is the system of immovable property registration subject to a state or private Yes 0.5 guarantee? Is there a speci c compensation mechanism to cover for losses incurred by parties who No 0.0 engaged in good faith in a property transaction based on erroneous information certi ed by the immovable property registry? Does the legal system require a control of legality of the documents necessary for a Yes 0.5 property transaction (e.g., checking the compliance of contracts with requirements of the law)? If yes, who is responsible for checking the legality of the documents? Registrar. Does the legal system require veri cation of the identity of the parties to a property Yes 0.5 transaction? If yes, who is responsible for verifying the identity of the parties? Registrar. Is there a national database to verify the accuracy of identity documents? No 0.0 For a standard land dispute between two local businesses over tenure rights of a District Court property worth 50 times gross national income (GNI) per capita and located in the largest business city, what court would be in charge of the case in the rst instance? How long does it take on average to obtain a decision from the rst-instance court for Between 1 and 2 2.0 such a case (without appeal)? years Are there any statistics on the number of land disputes in the rst instance? No 0.0 Number of land disputes in the largest business city in 2015: Equal access to property rights index (-2–0) 0.0 Do unmarried men and unmarried women have equal ownership rights to property? Yes 0.0 Do married men and married women have equal ownership rights to property? Yes 0.0 Getting Credit This topic explores two sets of issues—the strength of credit reporting systems and the e ectiveness of collateral and bankruptcy laws in facilitating lending. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Strength of legal rights index (0–12) Doing Business assesses the sharing of credit information and the legal rights of borrowers and lenders with respect to secured transactions Rights of borrowers and lenders through through 2 sets of indicators. The depth of credit information index collateral laws (0-10) measures rules and practices a ecting the coverage, scope and Protection of secured creditors’ rights through accessibility of credit information available through a credit registry or a bankruptcy laws (0-2) credit bureau. The strength of legal rights index measures the degree to Depth of credit information index (0–8) which collateral and bankruptcy laws protect the rights of borrowers and lenders and thus facilitate lending. For each economy it is first determined Scope and accessibility of credit information whether a unitary secured transactions system exists. Then two case distributed by credit bureaus and credit Page 57   scenarios, case A and case B, are used to determine how a nonpossessory registries (0-8) Do married men and married women have equal ownership rights to property? Yes 0.0 Doing Business 2018 Japan Getting Credit This topic explores two sets of issues—the strength of credit reporting systems and the e ectiveness of collateral and bankruptcy laws in facilitating lending. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Strength of legal rights index (0–12) Doing Business assesses the sharing of credit information and the legal rights of borrowers and lenders with respect to secured transactions Rights of borrowers and lenders through through 2 sets of indicators. The depth of credit information index collateral laws (0-10) measures rules and practices a ecting the coverage, scope and Protection of secured creditors’ rights through accessibility of credit information available through a credit registry or a bankruptcy laws (0-2) credit bureau. The strength of legal rights index measures the degree to Depth of credit information index (0–8) which collateral and bankruptcy laws protect the rights of borrowers and lenders and thus facilitate lending. For each economy it is first determined Scope and accessibility of credit information whether a unitary secured transactions system exists. Then two case distributed by credit bureaus and credit scenarios, case A and case B, are used to determine how a nonpossessory registries (0-8) security interest is created, publicized and enforced according to the law. Credit bureau coverage (% of adults) Special emphasis is given to how the collateral registry operates (if Number of individuals and firms listed in largest registration of security interests is possible). The case scenarios involve a credit bureau as a percentage of adult population secured borrower, company ABC, and a secured lender, BizBank. Credit registry coverage (% of adults) In some economies the legal framework for secured transactions will allow Number of individuals and firms listed in credit only case A or case B (not both) to apply. Both cases examine the same set registry as a percentage of adult population of legal provisions relating to the use of movable collateral. Several assumptions about the secured borrower (ABC) and lender (BizBank) are used: - ABC is a domestic limited liability company (or its legal equivalent). - ABC has up to 50 employees. - ABC has its headquarters and only base of operations in the economy’s largest business city. For 11 economies the data are also collected for the second largest business city. - Both ABC and BizBank are 100% domestically owned. The case scenarios also involve assumptions. In case A, as collateral for the loan, ABC grants BizBank a nonpossessory security interest in one category of movable assets, for example, its machinery or its inventory. ABC wants to keep both possession and ownership of the collateral. In economies where the law does not allow nonpossessory security interests in movable property, ABC and BizBank use a fiduciary transfer-of-title arrangement (or a similar substitute for nonpossessory security interests). In case B, ABC grants BizBank a business charge, enterprise charge, floating charge or any charge that gives BizBank a security interest over ABC’s combined movable assets (or as much of ABC’s movable assets as possible). ABC keeps ownership and possession of the assets. Getting Credit - Tokyo OECD high OECD high Indicator Tokyo income income Overall Best Performer Strength of legal rights index (0-12) 5 6.0 6.0 12.00 (4 Economies) Page 58   possible). ABC keeps ownership and possession of the assets. Doing Business 2018 Japan Getting Credit - Tokyo OECD high OECD high Indicator Tokyo income income Overall Best Performer Strength of legal rights index (0-12) 5 6.0 6.0 12.00 (4 Economies) Depth of credit information index (0-8) 6 6.6 6.6 8.00 (34 Economies) Credit registry coverage (% of adults) 0.0 18.3 18.3 100.00 (3 Economies) Credit bureau coverage (% of adults) 100.0 63.7 63.7 100.00 (23 Economies) Figure – Getting Credit in Japan and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 95.00: United States (Rank: 2) 90.00: Australia (Rank: 6) 65.00: Korea, Rep. (Rank: 55) 55.00: Tokyo Note: The ranking of economies on the ease of getting credit is determined by sorting their distance to frontier scores for getting credit. These scores are the distance to frontier score for the sum of the strength of legal rights index and the depth of credit information index. Figure – Legal Rights in Tokyo and comparator economies 12 11 11 10 8 Index score 6.0 6 5 5 4 2 0 Tokyo Australia Korea, Rep. United States OECD high income Details – Legal Rights in Tokyo Strength of legal rights index (0-12) 5 Does an integrated or uni ed legal framework for secured transactions that extends to the creation, publicity and No enforcement of functional equivalents to security interests in movable assets exist in the economy? Page 59   Tokyo Australia Korea, Rep. United States OECD high income Doing Business 2018 Japan Details – Legal Rights in Tokyo Strength of legal rights index (0-12) 5 Does an integrated or uni ed legal framework for secured transactions that extends to the creation, publicity and No enforcement of functional equivalents to security interests in movable assets exist in the economy? Does the law allow businesses to grant a non possessory security right in a single category of movable assets, without Yes requiring a speci c description of collateral? Does the law allow businesses to grant a non possessory security right in substantially all of its assets, without requiring No a speci c description of collateral? May a security right extend to future or after-acquired assets, and does it extend automatically to the products, proceeds No or replacements of the original assets? Is a general description of debts and obligations permitted in collateral agreements; can all types of debts and Yes obligations be secured between parties; and can the collateral agreement include a maximum amount for which the assets are encumbered? Is a collateral registry in operation for both incorporated and non-incorporated entities, that is uni ed geographically No and by asset type, with an electronic database indexed by debtor's name? Does a notice-based collateral registry exist in which all functional equivalents can be registered? No Does a modern collateral registry exist in which registrations, amendments, cancellations and searches can be No performed online by any interested third party? Are secured creditors paid rst (i.e. before tax claims and employee claims) when a debtor defaults outside an insolvency Yes procedure? Are secured creditors paid rst (i.e. before tax claims and employee claims) when a business is liquidated? Yes Are secured creditors subject to an automatic stay on enforcement when a debtor enters a court-supervised reorganization procedure? Does the law protect secured creditors’ rights by providing clear grounds for relief from the stay and/or sets a time limit for it? Does the law allow parties to agree on out of court enforcement at the time a security interest is created? Does the law Yes allow the secured creditor to sell the collateral through public auction or private tender, as well as, for the secured creditor to keep the asset in satisfaction of the debt? Figure – Credit Information in Tokyo and comparator economies 10 8 8 8 7 6.6 Index score 6 6 4 2 0 Tokyo Australia Korea, Rep. United States OECD high income Details – Credit Information in Tokyo Page 60   0 Doing BusinessTokyo 2018 Japan Australia Korea, Rep. United States OECD high income Details – Credit Information in Tokyo Credit Credit Depth of credit information index (0-8) bureau registry Score Are data on both firms and individuals distributed? No No 0 Are both positive and negative credit data distributed? Yes No 1 Are data from retailers or utility companies - in addition to data from banks and financial institutions - Yes No 1 distributed? Are at least 2 years of historical data distributed? (Credit bureaus and registries that distribute more Yes No 1 than 10 years of negative data or erase data on defaults as soon as they are repaid obtain a score of 0 for this component.) Are data on loan amounts below 1% of income per capita distributed? Yes No 1 By law, do borrowers have the right to access their data in the credit bureau or credit registry? Yes No 1 Can banks and financial institutions access borrowers’ credit information online (for example, Yes No 1 through an online platform, a system-to-system connection or both)? Are bureau or registry credit scores offered as a value-added service to help banks and financial No No 0 institutions assess the creditworthiness of borrowers? Score ("yes" to either public bureau or private registry) 6 Note: An economy receives a score of 1 if there is a "yes" to either bureau or registry. If the credit bureau or registry is not operational or covers less than 5% of the adult population, the total score on the depth of credit information index is 0. Coverage Credit bureau Credit registry Number of individuals 87,850,000 0 Number of firms 0 0 Total 87,850,000 0 Percentage of adult population 100.0 0.0 Getting Credit - Osaka OECD high OECD high Indicator Osaka income income Overall Best Performer Strength of legal rights index (0-12) 5 6.0 6.0 12.00 (4 Economies) Depth of credit information index (0-8) 6 6.6 6.6 8.00 (34 Economies) Credit registry coverage (% of adults) 0.0 18.3 18.3 100.00 (3 Economies) Credit bureau coverage (% of adults) 100.0 63.7 63.7 100.00 (23 Economies) Figure – Getting Credit in Japan and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) Page 61   Percentage of adult population 100.0 0.0 Doing Business 2018 Japan Getting Credit - Osaka OECD high OECD high Indicator Osaka income income Overall Best Performer Strength of legal rights index (0-12) 5 6.0 6.0 12.00 (4 Economies) Depth of credit information index (0-8) 6 6.6 6.6 8.00 (34 Economies) Credit registry coverage (% of adults) 0.0 18.3 18.3 100.00 (3 Economies) Credit bureau coverage (% of adults) 100.0 63.7 63.7 100.00 (23 Economies) Figure – Getting Credit in Japan and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 95.00: United States (Rank: 2) 90.00: Australia (Rank: 6) 65.00: Korea, Rep. (Rank: 55) 55.00: Osaka Note: The ranking of economies on the ease of getting credit is determined by sorting their distance to frontier scores for getting credit. These scores are the distance to frontier score for the sum of the strength of legal rights index and the depth of credit information index. Figure – Legal Rights in Osaka and comparator economies 12 11 11 10 8 Index score 6.0 6 5 5 4 2 0 Osaka Australia Korea, Rep. United States OECD high income Details – Legal Rights in Osaka Strength of legal rights index (0-12) 5 Does an integrated or uni ed legal framework for secured transactions that extends to the creation, publicity and No Page 62   enforcement of functional equivalents to security interests in movable assets exist in the economy? Doing Business 2018 Japan Details – Legal Rights in Osaka Strength of legal rights index (0-12) 5 Does an integrated or uni ed legal framework for secured transactions that extends to the creation, publicity and No enforcement of functional equivalents to security interests in movable assets exist in the economy? Does the law allow businesses to grant a non possessory security right in a single category of movable assets, without Yes requiring a speci c description of collateral? Does the law allow businesses to grant a non possessory security right in substantially all of its assets, without requiring No a speci c description of collateral? May a security right extend to future or after-acquired assets, and does it extend automatically to the products, proceeds No or replacements of the original assets? Is a general description of debts and obligations permitted in collateral agreements; can all types of debts and Yes obligations be secured between parties; and can the collateral agreement include a maximum amount for which the assets are encumbered? Is a collateral registry in operation for both incorporated and non-incorporated entities, that is uni ed geographically No and by asset type, with an electronic database indexed by debtor's name? Does a notice-based collateral registry exist in which all functional equivalents can be registered? No Does a modern collateral registry exist in which registrations, amendments, cancellations and searches can be No performed online by any interested third party? Are secured creditors paid rst (i.e. before tax claims and employee claims) when a debtor defaults outside an insolvency Yes procedure? Are secured creditors paid rst (i.e. before tax claims and employee claims) when a business is liquidated? Yes Are secured creditors subject to an automatic stay on enforcement when a debtor enters a court-supervised No reorganization procedure? Does the law protect secured creditors’ rights by providing clear grounds for relief from the stay and/or sets a time limit for it? Does the law allow parties to agree on out of court enforcement at the time a security interest is created? Does the law Yes allow the secured creditor to sell the collateral through public auction or private tender, as well as, for the secured creditor to keep the asset in satisfaction of the debt? Figure – Credit Information in Osaka and comparator economies 10 8 8 8 7 6.6 Index score 6 6 4 2 0 Osaka Australia Korea, Rep. United States OECD high income Details – Credit Information in Osaka Page 63   0 Doing BusinessOsaka 2018 Japan Australia Korea, Rep. United States OECD high income Details – Credit Information in Osaka Credit Credit Depth of credit information index (0-8) bureau registry Score Are data on both firms and individuals distributed? No No 0 Are both positive and negative credit data distributed? Yes No 1 Are data from retailers or utility companies - in addition to data from banks and financial institutions - Yes No 1 distributed? Are at least 2 years of historical data distributed? (Credit bureaus and registries that distribute more Yes No 1 than 10 years of negative data or erase data on defaults as soon as they are repaid obtain a score of 0 for this component.) Are data on loan amounts below 1% of income per capita distributed? Yes No 1 By law, do borrowers have the right to access their data in the credit bureau or credit registry? Yes No 1 Can banks and financial institutions access borrowers’ credit information online (for example, Yes No 1 through an online platform, a system-to-system connection or both)? Are bureau or registry credit scores offered as a value-added service to help banks and financial No No 0 institutions assess the creditworthiness of borrowers? Score ("yes" to either public bureau or private registry) 6 Note: An economy receives a score of 1 if there is a "yes" to either bureau or registry. If the credit bureau or registry is not operational or covers less than 5% of the adult population, the total score on the depth of credit information index is 0. Coverage Credit bureau Credit registry Number of individuals 87,850,000 0 Number of firms 0 0 Total 87,850,000 0 Percentage of adult population 100.0 0.0 Protecting Minority Investors This topic measures the strength of minority shareholder protections against misuse of corporate assets by directors for their personal gain as well as shareholder rights, governance safeguards and corporate transparency requirements that reduce the risk of abuse. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Extent of disclosure index (0–10): Review and To make the data comparable across economies, a case study uses several approval requirements for related-party assumptions about the business and the transaction. transactions; Disclosure requirements for related-party transactions The business (Buyer): Extent of director liability index (0–10): Ability of - Is a publicly traded corporation listed on the economy’s most important minority shareholders to sue and hold interested stock exchange. If the number of publicly traded companies listed on that directors liable for prejudicial related-party exchange is less than 10, or if there is no stock exchange in the economy, it is assumed that Buyer is a large private company with multiple Page 64   transactions; Available legal remedies (damages, Percentage of adult population 100.0 0.0 Doing Business 2018 Japan Protecting Minority Investors This topic measures the strength of minority shareholder protections against misuse of corporate assets by directors for their personal gain as well as shareholder rights, governance safeguards and corporate transparency requirements that reduce the risk of abuse. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Extent of disclosure index (0–10): Review and To make the data comparable across economies, a case study uses several approval requirements for related-party assumptions about the business and the transaction. transactions; Disclosure requirements for related-party transactions The business (Buyer): Extent of director liability index (0–10): Ability of - Is a publicly traded corporation listed on the economy’s most important minority shareholders to sue and hold interested stock exchange. If the number of publicly traded companies listed on that directors liable for prejudicial related-party exchange is less than 10, or if there is no stock exchange in the economy, it transactions; Available legal remedies (damages, is assumed that Buyer is a large private company with multiple disgorgement of profits, fines, imprisonment, shareholders. rescission of the transaction) - Has a board of directors and a chief executive o cer (CEO) who may legally act on behalf of Buyer where permitted, even if this is not speci cally Ease of shareholder suits index (0–10): Access to required by law. internal corporate documents; Evidence - Has a supervisory board (applicable to economies with a two-tier board obtainable during trial and allocation of legal system) on which 60% of the shareholder-elected members have been expenses appointed by Mr. James, who is Buyer’s controlling shareholder and a Extent of conflict of interest regulation index member of Buyer’s board of directors. (0–10): Simple average of the extent of disclosure, - Has not adopted any bylaws or articles of association that di er from extent of director liability and ease of default minimum standards and does not follow any nonmandatory codes, shareholder indices principles, recommendations or guidelines relating to corporate Extent of shareholder rights index (0-10): governance. Shareholders’ rights and role in major corporate - Is a manufacturing company with its own distribution network. decisions Extent of ownership and control index (0-10): The transaction involves the following details: Governance safeguards protecting shareholders - Mr. James owns 60% of Buyer and elected two directors to Buyer’s ve- from undue board control and entrenchment member board. Extent of corporate transparency index (0-10): - Mr. James also owns 90% of Seller, a company that operates a chain of Corporate transparency on ownership stakes, retail hardware stores. Seller recently closed a large number of its stores. compensation, audits and financial prospects - Mr. James proposes that Buyer purchase Seller’s unused eet of trucks to expand Buyer’s distribution of its food products, a proposal to which Buyer Extent of shareholder governance index (0–10): agrees. The price is equal to 10% of Buyer’s assets and is higher than the Simple average of the extent of shareholders market value. rights, extent of ownership and control and - The proposed transaction is part of the company’s ordinary course of extent of corporate transparency indices business and is not outside the authority of the company. Strength of minority investor protection index - Buyer enters into the transaction. All required approvals are obtained, (0–10): Simple average of the extent of conflict of and all required disclosures made (that is, the transaction is not interest regulation and extent of shareholder fraudulent). governance indices - The transaction causes damages to Buyer. Shareholders sue Mr. James and the other parties that approved the transaction. Protecting Minority Investors - Tokyo OECD high OECD high Indicator Tokyo income income Overall Best Performer Extent of conflict of interest regulation index (0- 7 6.4 6.4 9.3 (New Zealand) Page 65   10) and the other parties that approved the transaction. Doing Business 2018 Japan Protecting Minority Investors - Tokyo OECD high OECD high Indicator Tokyo income income Overall Best Performer Extent of conflict of interest regulation index (0- 7 6.4 6.4 9.3 (New Zealand) 10) Extent of shareholder governance index (0-10) 4.7 6.4 6.4 9.00 (Kazakhstan) Figure – Protecting Minority Investors in Japan and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 71.67: Korea, Rep. (Rank: 20) 64.67: United States (Rank: 42) 60.00: Australia (Rank: 57) 58.33: Tokyo Note: The ranking of economies on the strength of minority investor protections is determined by sorting their distance to frontier scores for protecting minority investors. These scores are the simple average of the distance to frontier scores for the extent of con ict of interest regulation index and the extent of shareholder governance index. Figure – Protecting Minority Investors in Tokyo and comparator economies – Measure of Quality Tokyo 5 6 7 3 6 8 Australia 9 2 8 4 5 8 Korea, Rep. 9 6 7 6 7 8 United States 5.4 8.6 7.4 4.4 4 9 OECD high income 7.3 5.6 6.5 5.2 6.3 7.4 0 5 10 15 20 25 30 35 40 45 Sub-Indicator Score Extent of corporate transparency index (0­10) Extent of director liability index (0­10) Extent of disclosure index (0­10) Extent of ownership and control index (0­10) Extent of shareholder rights index (0­10) Ease of shareholder suits index (0­10) Details – Protecting Minority Investors in Tokyo – Measure of Quality Page 66   Extent of ownership and control index (0­10) Extent of shareholder rights index (0­10) Ease of shareholder suits index (0­10) Doing Business 2018 Japan Details – Protecting Minority Investors in Tokyo – Measure of Quality Answer Score Extent of con ict of interest regulation index (0-10) 7 Extent of disclosure index (0-10) 7 Which corporate body is legally su cient to approve the Buyer-Seller transaction? (0-3) Board of 2.0 directors excluding interested members Must an external body review the terms of the transaction before it takes place? (0-1) No 0.0 Must Mr. James disclose his con ict of interest to the board of directors? (0-2) Full disclosure of 2.0 all material facts Must Buyer disclose the transaction in published periodic lings (annual reports)? (0-2) Disclosure on 2.0 the transaction and on the con ict of interest Must Buyer immediately disclose the transaction to the public and/or shareholders? (0- Disclosure on 1.0 2) the transaction only Extent of director liability index (0-10) 6 Can shareholders representing 10% of Buyer's share capital sue directly or derivatively Yes 1.0 for the damage the transaction caused to Buyer? (0-1) Can shareholders hold the interested director liable for the damage the transaction Liable if unfair or 2.0 caused to Buyer? (0-2) prejudicial Can shareholders hold the other directors liable for the damage the transaction caused Liable if unfair or 2.0 to Buyer (0-2) prejudicial Must Mr. James pay damages for the harm caused to Buyer upon a successful claim by Yes 1.0 shareholders? (0-1) Must Mr. James repay pro ts made from the transaction upon a successful claim by No 0.0 shareholders? (0-1) Is Mr. James disquali ed or ned and imprisoned upon a successful claim by No 0.0 shareholders? (0-1) Can a court void the transaction upon a successful claim by shareholders? (0-2) Only in case of 0.0 fraud or bad faith Ease of shareholder suits index (0-10) 8 Before suing can shareholders representing 10% of Buyer's share capital inspect the Yes 1.0 transaction documents? (0-1) Can the plainti obtain any documents from the defendant and witnesses at trial? (0-3) Any relevant 3.0 document Page 67   Before suing can shareholders representing 10% of Buyer's share capital inspect the Yes 1.0 transaction Doing 2018 (0-1) documents? Business Japan Can the plainti obtain any documents from the defendant and witnesses at trial? (0-3) Any relevant 3.0 document Can the plainti request categories of documents from the defendant without No 0.0 identifying speci c ones? (0-1) Can the plainti directly question the defendant and witnesses at trial? (0-2) Yes 2.0 Is the level of proof required for civil suits lower than that of criminal cases? (0-1) Yes 1.0 Can shareholder plainti s recover their legal expenses from the company? (0-2) Yes if successful 1.0 Extent of shareholder governance index (0-10) 4.7 Extent of shareholder rights index (0-10) 6 Does the sale of 51% of Buyer's assets require shareholder approval? Yes 1.0 Can shareholders representing 10% of Buyer's share capital call for a meeting of Yes 1.0 shareholders? Must Buyer obtain its shareholders’ approval every time it issues new shares? No 0.0 Do shareholders automatically receive preemption rights every time Buyer issues new No 0.0 shares? Must shareholders approve the election and dismissal of the external auditor? Yes 1.0 Are changes to the rights of a class of shares only possible if the holders of the a ected Yes 1.0 shares approve? Assuming that Buyer is a limited company, does the sale of 51% of its assets require Yes 1.0 member approval? Assuming that Buyer is a limited company, can members representing 10% call for a No 0.0 meeting of members? Assuming that Buyer is a limited company, must all members consent to add a new Yes 1.0 member? Assuming that Buyer is a limited company, must a member rst o er to sell their No 0.0 interest to the existing members before they can sell to non-members? Extent of ownership and control index (0-10) 3 Is it forbidden to appoint the same individual as CEO and chair of the board of No 0.0 directors? Must the board of directors include independent and nonexecutive board members? No 0.0 Can shareholders remove members of the board of directors without cause before the Yes 1.0 end of their term? Must the board of directors include a separate audit committee exclusively comprising No 0.0 board members? Must a potential acquirer make a tender o er to all shareholders upon acquiring 50% No 0.0 of Buyer? Must Buyer pay declared dividends within a maximum period set by law? No 0.0 Page 68   Must a potential acquirer make a tender o er to all shareholders upon acquiring 50% No 0.0 of Buyer? Doing Business 2018 Japan Must Buyer pay declared dividends within a maximum period set by law? No 0.0 Is a subsidiary prohibited from acquiring shares issued by its parent company? Yes 1.0 Assuming that Buyer is a limited company, must Buyer have a mechanism to resolve Yes 1.0 disagreements among members? Assuming that Buyer is a limited company, must a potential acquirer make a tender No 0.0 o er to all shareholders upon acquiring 50% of Buyer? Assuming that Buyer is a limited company, must Buyer distribute pro ts within a No 0.0 maximum period set by law? Extent of corporate transparency index (0-10) 5 Must Buyer disclose direct and indirect bene cial ownership stakes representing 5%? No 0.0 Must Buyer disclose information about board members’ primary employment and Yes 1.0 directorships in other companies? Must Buyer disclose the compensation of individual managers? No 0.0 Must a detailed notice of general meeting be sent 21 days before the meeting? No 0.0 Can shareholders representing 5% of Buyer’s share capital put items on the general Yes 1.0 meeting agenda? Must Buyer's annual nancial statements be audited by an external auditor? Yes 1.0 Must Buyer disclose its audit reports to the public? Yes 1.0 Assuming that Buyer is a limited company, must members meet at least once a year? No 0.0 Assuming that Buyer is a limited company, can members representing 5% put items on Yes 1.0 the meeting agenda? Assuming that Buyer is a limited company, must Buyer's annual nancial statements be No 0.0 audited by an external auditor? Protecting Minority Investors - Osaka OECD high OECD high Indicator Osaka income income Overall Best Performer Extent of conflict of interest regulation index (0- 7 6.4 6.4 9.3 (New Zealand) 10) Extent of shareholder governance index (0-10) 4.7 6.4 6.4 9.00 (Kazakhstan) Figure – Protecting Minority Investors in Japan and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 71.67: Korea, Rep. (Rank: 20) Page 69   64.67: United States (Rank: 42) Assuming that Buyer is a limited company, must Buyer's annual nancial statements be No 0.0 audited by an external auditor? Doing Business 2018 Japan Protecting Minority Investors - Osaka OECD high OECD high Indicator Osaka income income Overall Best Performer Extent of conflict of interest regulation index (0- 7 6.4 6.4 9.3 (New Zealand) 10) Extent of shareholder governance index (0-10) 4.7 6.4 6.4 9.00 (Kazakhstan) Figure – Protecting Minority Investors in Japan and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 71.67: Korea, Rep. (Rank: 20) 64.67: United States (Rank: 42) 60.00: Australia (Rank: 57) 58.33: Osaka Note: The ranking of economies on the strength of minority investor protections is determined by sorting their distance to frontier scores for protecting minority investors. These scores are the simple average of the distance to frontier scores for the extent of con ict of interest regulation index and the extent of shareholder governance index. Figure – Protecting Minority Investors in Osaka and comparator economies – Measure of Quality Osaka 5 6 7 3 6 8 Australia 9 2 8 4 5 8 Korea, Rep. 9 6 7 6 7 8 United States 5.4 8.6 7.4 4.4 4 9 OECD high income 7.3 5.6 6.5 5.2 6.3 7.4 0 5 10 15 20 25 30 35 40 45 Sub-Indicator Score Extent of corporate transparency index (0­10) Extent of director liability index (0­10) Extent of disclosure index (0­10) Extent of ownership and control index (0­10) Extent of shareholder rights index (0­10) Ease of shareholder suits index (0­10) Page 70   con ict of interest regulation index and the extent of shareholder governance index. Doing Business 2018 Japan Figure – Protecting Minority Investors in Osaka and comparator economies – Measure of Quality Osaka 5 6 7 3 6 8 Australia 9 2 8 4 5 8 Korea, Rep. 9 6 7 6 7 8 United States 5.4 8.6 7.4 4.4 4 9 OECD high income 7.3 5.6 6.5 5.2 6.3 7.4 0 5 10 15 20 25 30 35 40 45 Sub-Indicator Score Extent of corporate transparency index (0­10) Extent of director liability index (0­10) Extent of disclosure index (0­10) Extent of ownership and control index (0­10) Extent of shareholder rights index (0­10) Ease of shareholder suits index (0­10) Details – Protecting Minority Investors in Osaka – Measure of Quality Answer Score Extent of con ict of interest regulation index (0-10) 7 Extent of disclosure index (0-10) 7 Which corporate body is legally su cient to approve the Buyer-Seller transaction? (0-3) Board of 2.0 directors excluding interested members Must an external body review the terms of the transaction before it takes place? (0-1) No 0.0 Must Mr. James disclose his con ict of interest to the board of directors? (0-2) Full disclosure of 2.0 all material facts Must Buyer disclose the transaction in published periodic lings (annual reports)? (0-2) Disclosure on 2.0 the transaction and on the con ict of interest Must Buyer immediately disclose the transaction to the public and/or shareholders? (0- Disclosure on 1.0 2) the transaction only Extent of director liability index (0-10) 6 Can shareholders representing 10% of Buyer's share capital sue directly or derivatively Yes 1.0 for the damage the transaction caused to Buyer? (0-1) Page 71   Extent of ownership and control index (0­10) Extent of shareholder rights index (0­10) Ease of shareholder suits index (0­10) Doing Business 2018 Japan Details – Protecting Minority Investors in Osaka – Measure of Quality Answer Score Extent of con ict of interest regulation index (0-10) 7 Extent of disclosure index (0-10) 7 Which corporate body is legally su cient to approve the Buyer-Seller transaction? (0-3) Board of 2.0 directors excluding interested members Must an external body review the terms of the transaction before it takes place? (0-1) No 0.0 Must Mr. James disclose his con ict of interest to the board of directors? (0-2) Full disclosure of 2.0 all material facts Must Buyer disclose the transaction in published periodic lings (annual reports)? (0-2) Disclosure on 2.0 the transaction and on the con ict of interest Must Buyer immediately disclose the transaction to the public and/or shareholders? (0- Disclosure on 1.0 2) the transaction only Extent of director liability index (0-10) 6 Can shareholders representing 10% of Buyer's share capital sue directly or derivatively Yes 1.0 for the damage the transaction caused to Buyer? (0-1) Can shareholders hold the interested director liable for the damage the transaction Liable if unfair or 2.0 caused to Buyer? (0-2) prejudicial Can shareholders hold the other directors liable for the damage the transaction caused Liable if unfair or 2.0 to Buyer (0-2) prejudicial Must Mr. James pay damages for the harm caused to Buyer upon a successful claim by Yes 1.0 shareholders? (0-1) Must Mr. James repay pro ts made from the transaction upon a successful claim by No 0.0 shareholders? (0-1) Is Mr. James disquali ed or ned and imprisoned upon a successful claim by No 0.0 shareholders? (0-1) Can a court void the transaction upon a successful claim by shareholders? (0-2) Only in case of 0.0 fraud or bad faith Ease of shareholder suits index (0-10) 8 Before suing can shareholders representing 10% of Buyer's share capital inspect the Yes 1.0 transaction documents? (0-1) Can the plainti obtain any documents from the defendant and witnesses at trial? (0-3) Any relevant 3.0 document Page 72   Before suing can shareholders representing 10% of Buyer's share capital inspect the Yes 1.0 transaction Doing 2018 (0-1) documents? Business Japan Can the plainti obtain any documents from the defendant and witnesses at trial? (0-3) Any relevant 3.0 document Can the plainti request categories of documents from the defendant without No 0.0 identifying speci c ones? (0-1) Can the plainti directly question the defendant and witnesses at trial? (0-2) Yes 2.0 Is the level of proof required for civil suits lower than that of criminal cases? (0-1) Yes 1.0 Can shareholder plainti s recover their legal expenses from the company? (0-2) Yes if successful 1.0 Extent of shareholder governance index (0-10) 4.7 Extent of shareholder rights index (0-10) 6 Does the sale of 51% of Buyer's assets require shareholder approval? Yes 1.0 Can shareholders representing 10% of Buyer's share capital call for a meeting of Yes 1.0 shareholders? Must Buyer obtain its shareholders’ approval every time it issues new shares? No 0.0 Do shareholders automatically receive preemption rights every time Buyer issues new No 0.0 shares? Must shareholders approve the election and dismissal of the external auditor? Yes 1.0 Are changes to the rights of a class of shares only possible if the holders of the a ected Yes 1.0 shares approve? Assuming that Buyer is a limited company, does the sale of 51% of its assets require Yes 1.0 member approval? Assuming that Buyer is a limited company, can members representing 10% call for a No 0.0 meeting of members? Assuming that Buyer is a limited company, must all members consent to add a new Yes 1.0 member? Assuming that Buyer is a limited company, must a member rst o er to sell their No 0.0 interest to the existing members before they can sell to non-members? Extent of ownership and control index (0-10) 3 Is it forbidden to appoint the same individual as CEO and chair of the board of No 0.0 directors? Must the board of directors include independent and nonexecutive board members? No 0.0 Can shareholders remove members of the board of directors without cause before the Yes 1.0 end of their term? Must the board of directors include a separate audit committee exclusively comprising No 0.0 board members? Must a potential acquirer make a tender o er to all shareholders upon acquiring 50% No 0.0 of Buyer? Must Buyer pay declared dividends within a maximum period set by law? No 0.0 Page 73   Must a potential acquirer make a tender o er to all shareholders upon acquiring 50% No 0.0 of Buyer? Doing Business 2018 Japan Must Buyer pay declared dividends within a maximum period set by law? No 0.0 Is a subsidiary prohibited from acquiring shares issued by its parent company? Yes 1.0 Assuming that Buyer is a limited company, must Buyer have a mechanism to resolve Yes 1.0 disagreements among members? Assuming that Buyer is a limited company, must a potential acquirer make a tender No 0.0 o er to all shareholders upon acquiring 50% of Buyer? Assuming that Buyer is a limited company, must Buyer distribute pro ts within a No 0.0 maximum period set by law? Extent of corporate transparency index (0-10) 5 Must Buyer disclose direct and indirect bene cial ownership stakes representing 5%? No 0.0 Must Buyer disclose information about board members’ primary employment and Yes 1.0 directorships in other companies? Must Buyer disclose the compensation of individual managers? No 0.0 Must a detailed notice of general meeting be sent 21 days before the meeting? No 0.0 Can shareholders representing 5% of Buyer’s share capital put items on the general Yes 1.0 meeting agenda? Must Buyer's annual nancial statements be audited by an external auditor? Yes 1.0 Must Buyer disclose its audit reports to the public? Yes 1.0 Assuming that Buyer is a limited company, must members meet at least once a year? No 0.0 Assuming that Buyer is a limited company, can members representing 5% put items on Yes 1.0 the meeting agenda? Assuming that Buyer is a limited company, must Buyer's annual nancial statements be No 0.0 audited by an external auditor? Paying Taxes This topic records the taxes and mandatory contributions that a medium-size company must pay or withhold in a given year, as well as measures the administrative burden in paying taxes and contributions. The most recent round of data collection for the project was completed on June 30, 2017 covering for the Paying Taxes indicator calendar year 2016 (January 1, 2016 – December 31, 2016). Last year (Doing Business 2017) the scope of data collection was expanded to better understand the overall tax environment in an economy. The questionnaire was expanded to include new questions on post- ling processes: VAT refund and tax audit. The data shows where post ling processes and practices work e ciently and what drives the di erences in the overall tax compliance cost across economies. The new section covers both the legal framework and the administrative burden on businesses to comply with post ling processes. See the methodology for more information. What the indicators measure Case study assumptions Tax payments for a manufacturing company in Using a case scenario, Doing Business records taxes and mandatory 2016 (number per year adjusted for electronic and contributions a medium size company must pay in a year, and measures joint ling and payment) the administrative burden of paying taxes, contributions and dealing with Page 74   post ling processes. Information is also compiled on frequency of ling Assuming that Buyer is a limited company, must Buyer's annual nancial statements be No 0.0 audited by an external auditor? Doing Business 2018 Japan Paying Taxes This topic records the taxes and mandatory contributions that a medium-size company must pay or withhold in a given year, as well as measures the administrative burden in paying taxes and contributions. The most recent round of data collection for the project was completed on June 30, 2017 covering for the Paying Taxes indicator calendar year 2016 (January 1, 2016 – December 31, 2016). Last year (Doing Business 2017) the scope of data collection was expanded to better understand the overall tax environment in an economy. The questionnaire was expanded to include new questions on post- ling processes: VAT refund and tax audit. The data shows where post ling processes and practices work e ciently and what drives the di erences in the overall tax compliance cost across economies. The new section covers both the legal framework and the administrative burden on businesses to comply with post ling processes. See the methodology for more information. What the indicators measure Case study assumptions Tax payments for a manufacturing company in Using a case scenario, Doing Business records taxes and mandatory 2016 (number per year adjusted for electronic and contributions a medium size company must pay in a year, and measures joint ling and payment) the administrative burden of paying taxes, contributions and dealing with post ling processes. Information is also compiled on frequency of ling Total number of taxes and contributions paid, and payments, time taken to comply with tax laws, time taken to comply including consumption taxes (value added tax, with the requirements of post ling processes and time waiting. sales tax or goods and service tax) Method and frequency of filing and payment To make data comparable across economies, several assumptions are used: Time required to comply with 3 major taxes - TaxpayerCo is a medium-size business that started operations on January (hours per year) 1, 2015. It produces ceramic flowerpots and sells them at retail. All taxes Collecting information, computing tax payable and contributions recorded are paid in the second year of operation Completing tax return, filing with agencies (calendar year 2016). Taxes and mandatory contributions are measured at all levels of government. Arranging payment or withholding Preparing separate tax accounting books, if The VAT refund process: required - In June 2016, TaxpayerCo. makes a large capital purchase: the value of the Total tax and contribution rate (% of pro t before machine is 65 times income per capita of the economy. Sales are equally all taxes) spread per month (1,050 times income per capita divided by 12) and cost of goods sold are equally expensed per month (875 times income per Profit or corporate income tax capita divided by 12). The machinery seller is registered for VAT and excess Social contributions, labor taxes paid by input VAT incurred in June will be fully recovered after four consecutive employer months if the VAT rate is the same for inputs, sales and the machine and Property and property transfer taxes the tax reporting period is every month. Input VAT will exceed Output VAT Dividend, capital gains, financial transactions in June 2016. taxes The corporate income tax audit process: Waste collection, vehicle, road and other taxes - An error in calculation of income tax liability (for example, use of incorrect tax depreciation rates, or incorrectly treating an expense as tax deductible) Post ling Index leads to an incorrect income tax return and a corporate income Time to comply with a VAT refund tax underpayment. TaxpayerCo. discovered the error and voluntarily Time to receive a VAT refund noti ed the tax authority. The value of the underpaid income tax liability is Time to comply with a corporate income tax audit 5% of the corporate income tax liability due. TaxpayerCo. submits corrected information after the deadline for submitting the annual tax Time to complete a corporate income tax audit return, but within the tax assessment period. Paying Taxes - Tokyo OECD high OECD high Indicator Tokyo income income Overall Best Performer Page 75   return, but within the tax assessment period. Doing Business 2018 Japan Paying Taxes - Tokyo OECD high OECD high Indicator Tokyo income income Overall Best Performer Payments (number per year) 14 10.9 10.9 3 (Hong Kong SAR, China) Time (hours per year) 151 160.7 160.7 55 (Luxembourg) Total tax and contribution rate (% of profit) 47.4 40.1 40.1 18.47% (32 Economies) Postfiling index (0-100) 71.69 83.45 83.45 99.38 (Estonia) Figure – Paying Taxes in Japan and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 86.69: Korea, Rep. (Rank: 24) 85.62: Australia (Rank: 26) 84.13: United States (Rank: 36) 76.72: Tokyo Note: The ranking of economies on the ease of paying taxes is determined by sorting their distance to frontier scores on the ease of paying taxes. These scores are the simple average of the distance to frontier scores for each of the four component indicators – number of tax payments. time, total tax rate and post ling index – with a threshold and a nonlinear transformation applied to one of the component indicators, the total tax rate. The nonlinear distance to frontier for the total tax rate is equal to the distance to frontier for the total tax rate to the power of 0.8. The threshold is de ned as the total tax rate at the 15th percentile of the overall distribution for all years included in the analysis up to and including Doing Business 2015, which is 26.1%. All economies with a total tax rate below this threshold receive the same score as the economy at the threshold. Figure – Paying Taxes in Tokyo and comparator economies – Measure of Quality 120 100 95.34 93.04 94.04 83.45 80 71.69 Index score 60 40 20 0 Tokyo Australia Korea, Rep. United States OECD high income Details – Paying Taxes in Tokyo Total tax Page 76   and Doing Business 2018 Japan Figure – Paying Taxes in Tokyo and comparator economies – Measure of Quality 120 100 95.34 93.04 94.04 83.45 80 71.69 Index score 60 40 20 0 Tokyo Australia Korea, Rep. United States OECD high income Details – Paying Taxes in Tokyo Total tax and contribution Tax or mandatory Payments Notes on Time rate (% of Notes contribution (number) Payments (hours) Statutory tax rate Tax base profit) on TTR Corporate income 1 online 38 23.9% taxable profit 16.17 tax Employer paid - 0 online 8.973% gross 10.12 Welfare pension and salaries insurance jointly Tokyo Metropolitan 0 online First 4,000,000 yen at (2.39% + taxable 5.70 - Enterprise Tax (on and 2.2%*67.4%), next 4,000,000 profits income) jointly yen at (3.475% +3.2%*67.4%), and profits above 8,000,000 yen at (4.66%+4.3%*67.4%) Employer paid - 1 online 92 4.98% gross 5.62 Health insurance salaries Inhabitants tax 1 online 16.3% taxable profit 2.76 (plus 530,000 yen) Employer paid - 0 online 1.9% gross 1.86 Workmen's and salaries accident jointly compensation Tokyo City - 1 online 1.4% net value of 1.65 Depreciable Fixed fixed assets Assets Tax Tokyo City - Fixed 1 online 1.4% property 1.28 Assets Tax (on land value and building) Tokyo Metropolitan 1 4% 70% of 0.85 - Real Property building Acquisition Tax (for expansion Page 77   Assets Tax (on land value and building) Doing Business 2018 Japan Tokyo Metropolitan 1 4% 70% of 0.85 - Real Property building Acquisition Tax (for expansion building expansion) value Employer paid - 1 online 0.7375% gross 0.72 Employment salaries insurance Tokyo City - City 0 online 0.3% property 0.27 Planning Tax (on and value land and building) jointly Employer paid - 0 online 0.1875% gross 0.21 Child allowance and salaries contribution jointly Registration and 1 0.4% 70% of 0.08 license tax building expansion value National - Stamp 1 125,000 yen per contract 0.05 Tax (on contracts for land sale and building expansion) Tokyo Metropolitan 1 67,100 yen fixed fee 0.03 - Automobile Tax National - 1 41,600 yen fixed fee 0.02 Automobile Tonnage Tax Local corporation 1 online 4.4% corporate 0.00 included tax income tax in other taxes Tax on interest 0 15.315% interest 0.00 included income in other taxes Fuel tax 1 34,140 yen per kiloliter fuel 0.00 small consumption amount Employee paid - 0 online 0.425% gross 0.00 withheld Employment and salaries insurance jointly Employee paid - 0 online 4.98% gross 0.00 withheld Health insurance and salaries jointly Employee paid - 0 online 8.973% gross 0.00 withheld Welfare pension and salaries insurance jointly Value added tax 1 online 21 8% value added 0.00 Page 78   not Health insurance and salaries Doing Business 2018 Japanjointly Employee paid - 0 online 8.973% gross 0.00 withheld Welfare pension and salaries insurance jointly Value added tax 1 online 21 8% value added 0.00 not (VAT) included Totals 14 151 47.4 Details – Paying Taxes in Tokyo – Tax by Type Taxes by type Answer Profit tax (% of profit) 24.6 Labor tax and contributions (% of profit) 18.5 Other taxes (% of profit) 4.2 Details – Paying Taxes in Tokyo – Measure of Quality Answer Score Post ling index (0-100) 71.69 VAT refunds Does VAT exist? Yes Does a VAT refund process exist per the case study? Yes Restrictions on VAT refund process None Percentage of cases exposed to a VAT audit (%) 0% - 24% Is there a mandatory carry forward period? No Time to comply with VAT refund (hours) 1.0 98 Time to obtain a VAT refund (weeks) 10.8 85.36 Corporate income tax audits Does corporate income tax exist? Yes Percentage of cases exposed to a corporate income tax audit (%) 25% - 49% Time to comply with a corporate income tax audit (hours) 23.0 60.55 Time to complete a corporate income tax audit (weeks) 18.3 42.86 Notes: Names of taxes have been standardized. For instance income tax, pro t tax, tax on company's income are all named corporate income tax in this table. The hours for VAT include all the VAT and sales taxes applicable. The hours for Social Security include all the hours for labor taxes and mandatory contributions in general. The post ling index is the average of the scores on time to comply with VAT refund, time to obtain a VAT refund, time to comply with a corporate income tax audit and time to complete a corporate income tax audit. Page 79   N/A = Not applicable. corporate income tax in this table. The hours for VAT include all the VAT and sales taxes applicable. Doing The for Social 2018 Business hours Security Japan include all the hours for labor taxes and mandatory contributions in general. The post ling index is the average of the scores on time to comply with VAT refund, time to obtain a VAT refund, time to comply with a corporate income tax audit and time to complete a corporate income tax audit. N/A = Not applicable. Paying Taxes - Osaka OECD high OECD high Indicator Osaka income income Overall Best Performer Payments (number per year) 14 10.9 10.9 3 (Hong Kong SAR, China) Time (hours per year) 151 160.7 160.7 55 (Luxembourg) Total tax and contribution rate (% of profit) 47.5 40.1 40.1 18.47% (32 Economies) Postfiling index (0-100) 71.69 83.45 83.45 99.38 (Estonia) Figure – Paying Taxes in Japan and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 86.69: Korea, Rep. (Rank: 24) 85.62: Australia (Rank: 26) 84.13: United States (Rank: 36) 76.69: Osaka Note: The ranking of economies on the ease of paying taxes is determined by sorting their distance to frontier scores on the ease of paying taxes. These scores are the simple average of the distance to frontier scores for each of the four component indicators – number of tax payments. time, total tax rate and post ling index – with a threshold and a nonlinear transformation applied to one of the component indicators, the total tax rate. The nonlinear distance to frontier for the total tax rate is equal to the distance to frontier for the total tax rate to the power of 0.8. The threshold is de ned as the total tax rate at the 15th percentile of the overall distribution for all years included in the analysis up to and including Doing Business 2015, which is 26.1%. All economies with a total tax rate below this threshold receive the same score as the economy at the threshold. Figure – Paying Taxes in Osaka and comparator economies – Measure of Quality 120 100 95.34 93.04 94.04 83.45 80 71.69 Index score 60 40 20 0 Osaka Australia Korea, Rep. United States Page 80   OECD high income a corporate income tax audit and time to complete a corporate income tax audit. N/A = Not applicable. Doing Business 2018 Japan Paying Taxes - Osaka OECD high OECD high Indicator Osaka income income Overall Best Performer Payments (number per year) 14 10.9 10.9 3 (Hong Kong SAR, China) Time (hours per year) 151 160.7 160.7 55 (Luxembourg) Total tax and contribution rate (% of profit) 47.5 40.1 40.1 18.47% (32 Economies) Postfiling index (0-100) 71.69 83.45 83.45 99.38 (Estonia) Figure – Paying Taxes in Japan and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 86.69: Korea, Rep. (Rank: 24) 85.62: Australia (Rank: 26) 84.13: United States (Rank: 36) 76.69: Osaka Note: The ranking of economies on the ease of paying taxes is determined by sorting their distance to frontier scores on the ease of paying taxes. These scores are the simple average of the distance to frontier scores for each of the four component indicators – number of tax payments. time, total tax rate and post ling index – with a threshold and a nonlinear transformation applied to one of the component indicators, the total tax rate. The nonlinear distance to frontier for the total tax rate is equal to the distance to frontier for the total tax rate to the power of 0.8. The threshold is de ned as the total tax rate at the 15th percentile of the overall distribution for all years included in the analysis up to and including Doing Business 2015, which is 26.1%. All economies with a total tax rate below this threshold receive the same score as the economy at the threshold. Figure – Paying Taxes in Osaka and comparator economies – Measure of Quality 120 100 95.34 93.04 94.04 83.45 80 71.69 Index score 60 40 20 0 Osaka Australia Korea, Rep. United States OECD high income Details – Paying Taxes in Osaka Page 81   Doing Business 2018 Japan Figure – Paying Taxes in Osaka and comparator economies – Measure of Quality 120 100 95.34 93.04 94.04 83.45 80 71.69 Index score 60 40 20 0 Osaka Australia Korea, Rep. United States OECD high income Details – Paying Taxes in Osaka Total tax and contribution Tax or mandatory Payments Notes on Time rate (% of Notes contribution (number) Payments (hours) Statutory tax rate Tax base profit) on TTR Corporate income 1 online 38 25.5% taxable 16.15 tax profits Employer paid - 0 online 8.914% gross 10.12 Welfare pension and salaries insurance jointly Osaka Metropolitan 0 online First 4,000,000 yen at (2.39% + taxable 5.69 - Enterprise Tax (on and 2.2%*67.4%), next 4,000,000 profits income) jointly yen at (3.475% +3.2%*67.4%), and profits above 8,000,000 yen at (4.66%+4.3%*67.4%) Employer paid - 1 online 92 5.035% gross 5.68 Health insurance salaries Inhabitants tax 1 online 11.9% + 4.2% taxable profit 2.78 (plus 660,000 yen) Employer paid - 0 online 1.9% gross 1.86 Workmen's and salaries accident jointly compensation Osaka City - 1 online 1.4% net value of 1.65 Depreciable Fixed fixed assets Assets Tax Osaka City - Fixed 1 online 1.4% property 1.30 Assets Tax (on land value and building) Osaka Metropolitan 1 4% 70% of 0.85 - Real Property building Acquisition Tax (for expansion Page 82   Assets Tax (on land value and building) Doing Business 2018 Japan Osaka Metropolitan 1 4% 70% of 0.85 - Real Property building Acquisition Tax (for expansion building expansion) value Employer paid - 1 online 0.85% gross 0.72 Employment salaries insurance Osaka City - City 0 online 0.3% property 0.28 Planning Tax (on and value land and building) jointly Employer paid - 0 online 0.15% gross 0.21 Child allowance and salaries contribution jointly Registration and 1 0.4% 70% of 0.08 license tax building expansion value National - Stamp 1 125,000 yen per contract 0.05 Tax (on contracts for land sale and building expansion) Osaka Metropolitan 1 67,100 yen fixed fee 0.03 - Automobile Tax National - 1 41,600 yen fixed fee 0.02 Automobile Tonnage Tax Local corporation 1 online 4.4% corporate 0.00 included tax income tax in other taxes Fuel tax 1 34,390 yen per kiloliter fuel 0.00 small consumption amount Employee paid - 0 online 0.5% gross 0.00 withheld Employment and salaries insurance jointly Employee paid - 0 online 5.035% gross 0.00 withheld Health insurance and salaries jointly Employee paid - 0 online 8.914% gross 0.00 withheld Welfare pension and salaries insurance jointly Tax on interest 0 20.315% interest 0.00 included income in other taxes Value added tax 1 online 21 8% value added 0.00 Page 83   not Welfare pension and salaries insurance Doing Business 2018 Japanjointly Tax on interest 0 20.315% interest 0.00 included income in other taxes Value added tax 1 online 21 8% value added 0.00 not (VAT) included Totals 14 151 47.5 Details – Paying Taxes in Osaka – Tax by Type Taxes by type Answer Profit tax (% of profit) 24.6 Labor tax and contributions (% of profit) 18.6 Other taxes (% of profit) 4.3 Details – Paying Taxes in Osaka – Measure of Quality Answer Score Post ling index (0-100) 71.69 VAT refunds Does VAT exist? Yes Does a VAT refund process exist per the case study? Yes Restrictions on VAT refund process None Percentage of cases exposed to a VAT audit (%) 0% - 24% Is there a mandatory carry forward period? No Time to comply with VAT refund (hours) 1.0 98 Time to obtain a VAT refund (weeks) 10.8 85.36 Corporate income tax audits Does corporate income tax exist? Yes Percentage of cases exposed to a corporate income tax audit (%) 25% - 49% Time to comply with a corporate income tax audit (hours) 23.0 60.55 Time to complete a corporate income tax audit (weeks) 18.3 42.86 Notes: Names of taxes have been standardized. For instance income tax, pro t tax, tax on company's income are all named corporate income tax in this table. The hours for VAT include all the VAT and sales taxes applicable. The hours for Social Security include all the hours for labor taxes and mandatory contributions in general. The post ling index is the average of the scores on time to comply with VAT refund, time to obtain a VAT refund, time to comply with a corporate income tax audit and time to complete a corporate income tax audit. Page 84   N/A = Not applicable. corporate income tax in this table. The hours for VAT include all the VAT and sales taxes applicable. Doing The for Social 2018 Business hours Security Japan include all the hours for labor taxes and mandatory contributions in general. The post ling index is the average of the scores on time to comply with VAT refund, time to obtain a VAT refund, time to comply with a corporate income tax audit and time to complete a corporate income tax audit. N/A = Not applicable. Trading across Borders Doing Business records the time and cost associated with the logistical process of exporting and importing goods. Doing Business measures the time and cost (excluding tari s) associated with three sets of procedures—documentary compliance, border compliance and domestic transport—within the overall process of exporting or importing a shipment of goods. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. Given the importance of trade digitalization, in Doing Business 2018, the Trading across Borders questionnaire included research questions on the availability and status of implementation of Electronic Data Interchange (EDI) and Single Window (SW) systems. With this information, Doing Business built a comprehensive dataset on the adoption and level of sophistication of electronic platforms in 190 economies. These data are not used to compute the distance to frontier score or ranking of the ease of doing business. The new dataset on EDI and SW systems is available here. What the indicators measure Case study assumptions Documentary compliance To make the data comparable across economies, a few assumptions are made about the traded goods and the transactions: Obtaining, preparing and submitting documents during transport, clearance, inspections and port Time: Time is measured in hours, and 1 day is 24 hours (for example, 22 or border handling in origin economy days are recorded as 22×24=528 hours). If customs clearance takes 7.5 Obtaining, preparing and submitting documents hours, the data are recorded as is. Alternatively, suppose documents are required by destination economy and any transit submitted to a customs agency at 8:00a.m., are processed overnight and economies can be picked up at 8:00a.m. the next day. The time for customs clearance Covers all documents required by law and in would be recorded as 24 hours because the actual procedure took 24 practice, including electronic submissions of hours. information Border compliance Cost: Insurance cost and informal payments for which no receipt is issued are excluded from the costs recorded. Costs are reported in U.S. dollars. Customs clearance and inspections Contributors are asked to convert local currency into U.S. dollars based on Inspections by other agencies (if applied to more the exchange rate prevailing on the day they answer the questionnaire. than 20% of shipments) Contributors are private sector experts in international trade logistics and Handling and inspections that take place at the are informed about exchange rates. economy’s port or border Assumptions of the case study: - For all 190 economies covered by Doing Domestic transport Business, it is assumed a shipment is in a warehouse in the largest Loading or unloading of the shipment at the business city of the exporting economy and travels to a warehouse in the warehouse or port/border largest business city of the importing economy. - It is assumed each Transport between warehouse and port/border economy imports 15 metric tons of containerized auto parts (HS 8708) Traffic delays and road police checks while from its natural import partner—the economy from which it imports the shipment is en route largest value (price times quantity) of auto parts. It is assumed each economy exports the product of its comparative advantage (de ned by the largest export value) to its natural export partner—the economy that is the largest purchaser of this product. Shipment value is assumed to be $50,000. - The mode of transport is the one most widely used for the chosen export or import product and the trading partner, as is the seaport, or land border crossing. - All electronic information submissions requested by any government agency in connection with the shipment are considered to be documents obtained, prepared and submitted during the export or import process. - A port or border is a place (seaport, airport or land border crossing) where merchandise can enter or leave an economy. - Relevant government agencies include customs, port authorities, road police, border guards, standardization agencies, ministries or departments Page 85   of agriculture or industry, national security agencies and any other a corporate income tax audit and time to complete a corporate income tax audit. N/A = Not applicable. Doing Business 2018 Japan Trading across Borders Doing Business records the time and cost associated with the logistical process of exporting and importing goods. Doing Business measures the time and cost (excluding tari s) associated with three sets of procedures—documentary compliance, border compliance and domestic transport—within the overall process of exporting or importing a shipment of goods. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. Given the importance of trade digitalization, in Doing Business 2018, the Trading across Borders questionnaire included research questions on the availability and status of implementation of Electronic Data Interchange (EDI) and Single Window (SW) systems. With this information, Doing Business built a comprehensive dataset on the adoption and level of sophistication of electronic platforms in 190 economies. These data are not used to compute the distance to frontier score or ranking of the ease of doing business. The new dataset on EDI and SW systems is available here. What the indicators measure Case study assumptions Documentary compliance To make the data comparable across economies, a few assumptions are made about the traded goods and the transactions: Obtaining, preparing and submitting documents during transport, clearance, inspections and port Time: Time is measured in hours, and 1 day is 24 hours (for example, 22 or border handling in origin economy days are recorded as 22×24=528 hours). If customs clearance takes 7.5 Obtaining, preparing and submitting documents hours, the data are recorded as is. Alternatively, suppose documents are required by destination economy and any transit submitted to a customs agency at 8:00a.m., are processed overnight and economies can be picked up at 8:00a.m. the next day. The time for customs clearance Covers all documents required by law and in would be recorded as 24 hours because the actual procedure took 24 practice, including electronic submissions of hours. information Border compliance Cost: Insurance cost and informal payments for which no receipt is issued are excluded from the costs recorded. Costs are reported in U.S. dollars. Customs clearance and inspections Contributors are asked to convert local currency into U.S. dollars based on Inspections by other agencies (if applied to more the exchange rate prevailing on the day they answer the questionnaire. than 20% of shipments) Contributors are private sector experts in international trade logistics and Handling and inspections that take place at the are informed about exchange rates. economy’s port or border Assumptions of the case study: - For all 190 economies covered by Doing Domestic transport Business, it is assumed a shipment is in a warehouse in the largest Loading or unloading of the shipment at the business city of the exporting economy and travels to a warehouse in the warehouse or port/border largest business city of the importing economy. - It is assumed each Transport between warehouse and port/border economy imports 15 metric tons of containerized auto parts (HS 8708) Traffic delays and road police checks while from its natural import partner—the economy from which it imports the shipment is en route largest value (price times quantity) of auto parts. It is assumed each economy exports the product of its comparative advantage (de ned by the largest export value) to its natural export partner—the economy that is the largest purchaser of this product. Shipment value is assumed to be $50,000. - The mode of transport is the one most widely used for the chosen export or import product and the trading partner, as is the seaport, or land border crossing. - All electronic information submissions requested by any government agency in connection with the shipment are considered to be documents obtained, prepared and submitted during the export or import process. - A port or border is a place (seaport, airport or land border crossing) where merchandise can enter or leave an economy. - Relevant government agencies include customs, port authorities, road police, border guards, standardization agencies, ministries or departments of agriculture or industry, national security agencies and any other government authorities. Page 86   of agriculture or industry, national security agencies and any other Doing Business 2018 Japan government authorities. Trading across Borders - Tokyo OECD high OECD high Indicator Tokyo income income Overall Best Performer Time to export: Border compliance (hours) 24 12.7 12.7 0 (17 Economies) Cost to export: Border compliance (USD) 241 149.9 149.9 0.00 (19 Economies) Time to export: Documentary compliance 3 2.4 2.4 1.0 (25 Economies) (hours) Cost to export: Documentary compliance (USD) 54 35.4 35.4 0.00 (19 Economies) Time to import: Border compliance (hours) 48 8.7 8.7 0.00 (21 Economies) Cost to import: Border compliance (USD) 275 111.6 111.6 0.00 (27 Economies) Time to import: Documentary compliance 3 3.5 3.5 1.0 (30 Economies) (hours) Cost to import: Documentary compliance (USD) 107 25.6 25.6 0.00 (30 Economies) Figure – Trading across Borders in Japan and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 92.52: Korea, Rep. (Rank: 33) 92.01: United States (Rank: 36) 86.53: Tokyo 70.65: Australia (Rank: 95) Note: The ranking of economies on the ease of trading across borders is determined by sorting their distance to frontier scores for trading across borders. These scores are the simple average of the distance to frontier scores for the time and cost for documentary compliance and border compliance to export and import (domestic transport is not used for calculating the ranking). Figure – Trading across Borders in Tokyo – Time and Cost Time Cost 60 275 300 50 241 48 250 40 200 Time (hours) Cost (USD) 30 150 24 107 20 100 54 10 3 3 Page 87   50 Doing Business 2018 Japan Figure – Trading across Borders in Tokyo – Time and Cost Time Cost 60 275 300 50 241 48 250 40 200 Time (hours) Cost (USD) 30 150 24 107 20 100 54 10 50 3 3 0 0 Export - Border Compliance Export - Documentary Compliance Import - Border Compliance Import - Documentary Compliance Details – Trading across Borders in Tokyo Characteristics Export Import Product HS 84 : Nuclear reactors, boilers, machinery and mechanical HS 8708: Parts and accessories of appliances; parts thereof motor vehicles Trade partner China China Border Yokohama port Yokohama port Distance (km) 20 20 Domestic transport 3 3 time (hours) Domestic transport 323 323 cost (USD) Details – Trading across Borders in Tokyo – Components of Border Compliance Time to Complete Associated Costs (hours) (USD) Export: Clearance and inspections required by customs authorities 2.5 50.0 Export: Clearance and inspections required by agencies other than customs 0.0 0.0 Export: Port or border handling 24.0 191.0 Import: Clearance and inspections required by customs authorities 2.5 90.0 Import: Clearance and inspections required by agencies other than customs 0.0 0.0 Import: Port or border handling 48.0 185.0 Details – Trading across Borders in Tokyo – Trade Documents Export Import Page 88   cost (USD) Doing Business 2018 Japan Details – Trading across Borders in Tokyo – Components of Border Compliance Time to Complete Associated Costs (hours) (USD) Export: Clearance and inspections required by customs authorities 2.5 50.0 Export: Clearance and inspections required by agencies other than customs 0.0 0.0 Export: Port or border handling 24.0 191.0 Import: Clearance and inspections required by customs authorities 2.5 90.0 Import: Clearance and inspections required by agencies other than customs 0.0 0.0 Import: Port or border handling 48.0 185.0 Details – Trading across Borders in Tokyo – Trade Documents Export Import Customs export declaration Invoice Commercial invoice Packing list Handling manual Bill of lading Packing list Customs import declaration SOLAS certificate SOLAS certificate Bill of lading Trading across Borders - Osaka OECD high OECD high Indicator Osaka income income Overall Best Performer Time to export: Border compliance (hours) 20 12.7 12.7 0 (17 Economies) Cost to export: Border compliance (USD) 309.2 149.9 149.9 0.00 (19 Economies) Time to export: Documentary compliance 1.2 2.4 2.4 1.0 (25 Economies) (hours) Cost to export: Documentary compliance (USD) 54 35.4 35.4 0.00 (19 Economies) Time to import: Border compliance (hours) 24 8.7 8.7 0.00 (21 Economies) Cost to import: Border compliance (USD) 344.2 111.6 111.6 0.00 (27 Economies) Time to import: Documentary compliance 4 3.5 3.5 1.0 (30 Economies) (hours) Cost to import: Documentary compliance (USD) 107 25.6 25.6 0.00 (30 Economies) Page 89   Bill of lading Doing Business 2018 Japan Trading across Borders - Osaka OECD high OECD high Indicator Osaka income income Overall Best Performer Time to export: Border compliance (hours) 20 12.7 12.7 0 (17 Economies) Cost to export: Border compliance (USD) 309.2 149.9 149.9 0.00 (19 Economies) Time to export: Documentary compliance 1.2 2.4 2.4 1.0 (25 Economies) (hours) Cost to export: Documentary compliance (USD) 54 35.4 35.4 0.00 (19 Economies) Time to import: Border compliance (hours) 24 8.7 8.7 0.00 (21 Economies) Cost to import: Border compliance (USD) 344.2 111.6 111.6 0.00 (27 Economies) Time to import: Documentary compliance 4 3.5 3.5 1.0 (30 Economies) (hours) Cost to import: Documentary compliance (USD) 107 25.6 25.6 0.00 (30 Economies) Figure – Trading across Borders in Japan and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 92.52: Korea, Rep. (Rank: 33) 92.01: United States (Rank: 36) 86.47: Osaka 70.65: Australia (Rank: 95) Note: The ranking of economies on the ease of trading across borders is determined by sorting their distance to frontier scores for trading across borders. These scores are the simple average of the distance to frontier scores for the time and cost for documentary compliance and border compliance to export and import (domestic transport is not used for calculating the ranking). Figure – Trading across Borders in Osaka – Time and Cost Time Cost 30 400 344.2 24 350 25 309.2 20 300 20 Time (hours) Cost (USD) 250 15 200 150 10 107 100 5 54 4 1.2 Page 90   50 Doing Business 2018 Japan Figure – Trading across Borders in Osaka – Time and Cost Time Cost 30 400 344.2 24 350 25 309.2 20 300 20 Time (hours) Cost (USD) 250 15 200 150 10 107 100 5 54 4 50 1.2 0 0 Export - Border Compliance Export - Documentary Compliance Import - Border Compliance Import - Documentary Compliance Details – Trading across Borders in Osaka Characteristics Export Import Product HS 84 : Nuclear reactors, boilers, machinery and mechanical HS 8708: Parts and accessories of appliances; parts thereof motor vehicles Trade partner China China Border Kobe port Kobe port Distance (km) 37 37 Domestic transport 2 2 time (hours) Domestic transport 280 280 cost (USD) Details – Trading across Borders in Osaka – Components of Border Compliance Time to Complete Associated Costs (hours) (USD) Export: Clearance and inspections required by customs authorities 2.7 60.8 Export: Clearance and inspections required by agencies other than customs 0.0 0.0 Export: Port or border handling 20.0 248.3 Import: Clearance and inspections required by customs authorities 4.8 95.8 Import: Clearance and inspections required by agencies other than customs 0.0 0.0 Import: Port or border handling 24.0 248.3 Details – Trading across Borders in Osaka – Trade Documents Export Import Page 91   cost (USD) Doing Business 2018 Japan Details – Trading across Borders in Osaka – Components of Border Compliance Time to Complete Associated Costs (hours) (USD) Export: Clearance and inspections required by customs authorities 2.7 60.8 Export: Clearance and inspections required by agencies other than customs 0.0 0.0 Export: Port or border handling 20.0 248.3 Import: Clearance and inspections required by customs authorities 4.8 95.8 Import: Clearance and inspections required by agencies other than customs 0.0 0.0 Import: Port or border handling 24.0 248.3 Details – Trading across Borders in Osaka – Trade Documents Export Import Customs export declaration Invoice Commercial invoice Packing list Handling manual Bill of lading Packing list Customs import declaration SOLAS certificate SOLAS certificate Bill of lading Enforcing Contracts The enforcing contracts indicator measures the time and cost for resolving a commercial dispute through a local rst-instance court, and the quality of judicial processes index, evaluating whether each economy has adopted a series of good practices that promote quality and e ciency in the court system. The most recent round of data collection was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Time required to enforce a contract through the The dispute in the case study involves the breach of a sales contract courts (calendar days) between 2 domestic businesses. The case study assumes that the court hears an expert on the quality of the goods in dispute. This distinguishes Time to file and serve the case the case from simple debt enforcement. Time for trial and to obtain the judgment To make the data comparable across economies, Doing Business uses Time to enforce the judgment several assumptions about the case: Cost required to enforce a contract through the - The dispute concerns a lawful transaction between two businesses (Seller courts (% of claim) and Buyer), both located in the economy’s largest business city. For 11 Attorney fees economies the data are also collected for the second largest business city. - The buyer orders custom-made goods, then fails to pay. Court fees - The value of the dispute is 200% of the income per capita or the Enforcement fees equivalent in local currency of USD 5,000, whichever is greater. Quality of judicial processes index (0-18) - The seller sues the buyer before the court with jurisdiction Page 92   over Bill of lading Doing Business 2018 Japan Enforcing Contracts The enforcing contracts indicator measures the time and cost for resolving a commercial dispute through a local rst-instance court, and the quality of judicial processes index, evaluating whether each economy has adopted a series of good practices that promote quality and e ciency in the court system. The most recent round of data collection was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Time required to enforce a contract through the The dispute in the case study involves the breach of a sales contract courts (calendar days) between 2 domestic businesses. The case study assumes that the court hears an expert on the quality of the goods in dispute. This distinguishes Time to file and serve the case the case from simple debt enforcement. Time for trial and to obtain the judgment To make the data comparable across economies, Doing Business uses Time to enforce the judgment several assumptions about the case: Cost required to enforce a contract through the - The dispute concerns a lawful transaction between two businesses (Seller courts (% of claim) and Buyer), both located in the economy’s largest business city. For 11 Attorney fees economies the data are also collected for the second largest business city. - The buyer orders custom-made goods, then fails to pay. Court fees - The value of the dispute is 200% of the income per capita or the Enforcement fees equivalent in local currency of USD 5,000, whichever is greater. Quality of judicial processes index (0-18) - The seller sues the buyer before the court with jurisdiction over commercial cases worth 200% of income per capita or $5,000. Court structure and proceedings (-1-5) - The seller requests a pretrial attachment to secure the claim. Case management (0-6) - The dispute on the quality of the goods requires an expert opinion. Court automation (0-4) - The judge decides in favor of the seller; there is no appeal. Alternative dispute resolution (0-3) - The seller enforces the judgment through a public sale of the buyer’s movable assets. Enforcing Contracts - Tokyo Standardized Case Claim value JPY 8,188,574.00 Court name Tokyo District Court City Covered Tokyo OECD high OECD high Indicator Tokyo income income Overall Best Performer Time (days) 360 577.8 577.8 164.00 (Singapore) Cost (% of claim value) 23.4 21.5 21.5 9.00 (Iceland) Quality of judicial processes index (0-18) 7.5 11.0 11.0 15.50 (Australia) Figure – Enforcing Contracts in Japan and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 Page 93   84.15: Korea, Rep. (Rank: 1) of judicial processes Quality Business Doing index (0-18) 2018 Japan 7.5 11.0 11.0 15.50 (Australia) Figure – Enforcing Contracts in Japan and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 84.15: Korea, Rep. (Rank: 1) 79.00: Australia (Rank: 3) 72.61: United States (Rank: 16) 65.26: Tokyo Note: The ranking of economies on the ease of enforcing contracts is determined by sorting their distance to frontier scores for enforcing contracts. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Enforcing Contracts in Tokyo – Time and Cost Time Cost 700 35 30.5 600 577.8 30 Cost (% of claim value) 500 23.2 23.4 25 21.5 420 Time (days) 402 400 360 20 290 300 12.7 15 200 10 100 5 0 0 Australia Korea, Rep. OECD high income Tokyo United States Figure – Enforcing Contracts in Tokyo and comparator economies – Measure of Quality Tokyo 2.5 1 1 3 Australia 2.5 5.5 3 4.5 Korea, Rep. 3 4 4 3.5 United States 2.5 4.7 2.2 4.4 OECD high income 2.5 2.9 2 3.6 0 2 4 6 8 10 12 14 16 Page 94   18 0 0 Australia Korea, Rep. OECD high income Tokyo United States Doing Business 2018 Japan Figure – Enforcing Contracts in Tokyo and comparator economies – Measure of Quality Tokyo 2.5 1 1 3 Australia 2.5 5.5 3 4.5 Korea, Rep. 3 4 4 3.5 United States 2.5 4.7 2.2 4.4 OECD high income 2.5 2.9 2 3.6 0 2 4 6 8 10 12 14 16 18 Sub-Indicator Score Alternative dispute resolution (0­3) Case management (0­6) Court automation (0­4) Court structure and proceedings (­1­5) Details – Enforcing Contracts in Tokyo Indicator Time (days) 360 Filing and service 20 Trial and judgment 280 Enforcement of judgment 60 Cost (% of claim value) 23.4 Attorney fees 18.5 Court fees 4.5 Enforcement fees 0.4 Quality of judicial processes index (0-18) 7.5 Court structure and proceedings (-1-5) 3.0 Case management (0-6) 1.0 Court automation (0-4) 1.0 Alternative dispute resolution (0-3) 2.5 Details – Enforcing Contracts in Tokyo – Measure of Quality Page 95   Alternative dispute resolution (0-3) 2.5 Doing Business 2018 Japan Details – Enforcing Contracts in Tokyo – Measure of Quality Answer Score Quality of judicial processes index (0-18) 7.5 Court structure and proceedings (-1-5) 3.0 1. Is there a court or division of a court dedicated solely to hearing commercial cases? No 0.0 2. Small claims court 1.5 2.a. Is there a small claims court or a fast-track procedure for small claims? Yes 2.b. If yes, is self-representation allowed? Yes 3. Is pretrial attachment available? Yes 1.0 4. Are new cases assigned randomly to judges? Yes, but manual 0.5 5. Does a woman's testimony carry the same evidentiary weight in court as a man's? Yes 0.0 Case management (0-6) 1.0 1. Time standards 0.0 1.a. Are there laws setting overall time standards for key court events in a civil case? Yes 1.b. If yes, are the time standards set for at least three court events? No 1.c. Are these time standards respected in more than 50% of cases? Yes 2. Adjournments 0.0 2.a. Does the law regulate the maximum number of adjournments that can be No granted? 2.b. Are adjournments limited to unforeseen and exceptional circumstances? No 2.c. If rules on adjournments exist, are they respected in more than 50% of cases? n.a. 3. Can two of the following four reports be generated about the competent court: (i) No 0.0 time to disposition report; (ii) clearance rate report; (iii) age of pending cases report; and (iv) single case progress report? 4. Is a pretrial conference among the case management techniques used before the Yes 1.0 competent court? 5. Are there any electronic case management tools in place within the competent court No 0.0 for use by judges? 6. Are there any electronic case management tools in place within the competent court No 0.0 for use by lawyers? Court automation (0-4) 1.0 1. Can the initial complaint be led electronically through a dedicated platform within No 0.0 the competent court? 2. Is it possible to carry out service of process electronically for claims led before the No 0.0 competent court? Page 96   1. Can the initial complaint be led electronically through a dedicated platform within No 0.0 Businesscourt? the competent Doing 2018 Japan 2. Is it possible to carry out service of process electronically for claims led before the No 0.0 competent court? 3. Can court fees be paid electronically within the competent court? No 0.0 4. Publication of judgments 1.0 4.a Are judgments rendered in commercial cases at all levels made available to the Yes general public through publication in o cial gazettes, in newspapers or on the internet or court website? 4.b. Are judgments rendered in commercial cases at the appellate and supreme Yes court level made available to the general public through publication in o cial gazettes, in newspapers or on the internet or court website? Alternative dispute resolution (0-3) 2.5 1. Arbitration 1.5 1.a. Is domestic commercial arbitration governed by a consolidated law or Yes consolidated chapter or section of the applicable code of civil procedure encompassing substantially all its aspects? 1.b. Are there any commercial disputes—aside from those that deal with public No order or public policy—that cannot be submitted to arbitration? 1.c. Are valid arbitration clauses or agreements usually enforced by the courts? Yes 2. Mediation/Conciliation 1.0 2.a. Is voluntary mediation or conciliation available? Yes 2.b. Are mediation, conciliation or both governed by a consolidated law or Yes consolidated chapter or section of the applicable code of civil procedure encompassing substantially all their aspects? 2.c. Are there nancial incentives for parties to attempt mediation or conciliation (i.e., No if mediation or conciliation is successful, a refund of court ling fees, income tax credits or the like)? Enforcing Contracts - Osaka Standardized Case Claim value JPY 8,188,574.00 Court name Osaka District Court City Covered Osaka OECD high OECD high Indicator Osaka income income Overall Best Performer Time (days) 360 577.8 577.8 164.00 (Singapore) Cost (% of claim value) 23.4 21.5 21.5 9.00 (Iceland) Quality of judicial processes index (0-18) 7.5 11.0 11.0 15.50 (Australia) Page 97   if mediation or conciliation is successful, a refund of court ling fees, income tax credits or the like)? Doing Business 2018 Japan Enforcing Contracts - Osaka Standardized Case Claim value JPY 8,188,574.00 Court name Osaka District Court City Covered Osaka OECD high OECD high Indicator Osaka income income Overall Best Performer Time (days) 360 577.8 577.8 164.00 (Singapore) Cost (% of claim value) 23.4 21.5 21.5 9.00 (Iceland) Quality of judicial processes index (0-18) 7.5 11.0 11.0 15.50 (Australia) Figure – Enforcing Contracts in Japan and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 84.15: Korea, Rep. (Rank: 1) 79.00: Australia (Rank: 3) 72.61: United States (Rank: 16) 65.26: Osaka Note: The ranking of economies on the ease of enforcing contracts is determined by sorting their distance to frontier scores for enforcing contracts. These scores are the simple average of the distance to frontier scores for each of the component indicators. Figure – Enforcing Contracts in Osaka – Time and Cost Time Cost 700 35 30.5 600 577.8 30 Cost (% of claim value) 500 23.2 23.4 25 21.5 420 Time (days) 402 400 360 20 290 300 12.7 15 200 10 100 5 0 0 Australia Korea, Rep. OECD high income Osaka United States Page 98   Figure – Enforcing Contracts in Osaka and comparator economies – Measure of Quality 0 0 Australia Korea, Rep. OECD high income Osaka United States Doing Business 2018 Japan Figure – Enforcing Contracts in Osaka and comparator economies – Measure of Quality Osaka 2.5 1 1 3 Australia 2.5 5.5 3 4.5 Korea, Rep. 3 4 4 3.5 United States 2.5 4.7 2.2 4.4 OECD high income 2.5 2.9 2 3.6 0 2 4 6 8 10 12 14 16 18 Sub-Indicator Score Alternative dispute resolution (0­3) Case management (0­6) Court automation (0­4) Court structure and proceedings (­1­5) Details – Enforcing Contracts in Osaka Indicator Time (days) 360 Filing and service 20 Trial and judgment 280 Enforcement of judgment 60 Cost (% of claim value) 23.4 Attorney fees 18.5 Court fees 4.5 Enforcement fees 0.4 Quality of judicial processes index (0-18) 7.5 Court structure and proceedings (-1-5) 3.0 Case management (0-6) 1.0 Court automation (0-4) 1.0 Alternative dispute resolution (0-3) 2.5 Details – Enforcing Contracts in Osaka – Measure of Quality Page 99   Alternative dispute resolution (0-3) 2.5 Doing Business 2018 Japan Details – Enforcing Contracts in Osaka – Measure of Quality Answer Score Quality of judicial processes index (0-18) 7.5 Court structure and proceedings (-1-5) 3.0 1. Is there a court or division of a court dedicated solely to hearing commercial cases? No 0.0 2. Small claims court 1.5 2.a. Is there a small claims court or a fast-track procedure for small claims? Yes 2.b. If yes, is self-representation allowed? Yes 3. Is pretrial attachment available? Yes 1.0 4. Are new cases assigned randomly to judges? Yes, but manual 0.5 5. Does a woman's testimony carry the same evidentiary weight in court as a man's? Yes 0.0 Case management (0-6) 1.0 1. Time standards 0.0 1.a. Are there laws setting overall time standards for key court events in a civil case? Yes 1.b. If yes, are the time standards set for at least three court events? No 1.c. Are these time standards respected in more than 50% of cases? Yes 2. Adjournments 0.0 2.a. Does the law regulate the maximum number of adjournments that can be No granted? 2.b. Are adjournments limited to unforeseen and exceptional circumstances? No 2.c. If rules on adjournments exist, are they respected in more than 50% of cases? n.a. 3. Can two of the following four reports be generated about the competent court: (i) No 0.0 time to disposition report; (ii) clearance rate report; (iii) age of pending cases report; and (iv) single case progress report? 4. Is a pretrial conference among the case management techniques used before the Yes 1.0 competent court? 5. Are there any electronic case management tools in place within the competent court No 0.0 for use by judges? 6. Are there any electronic case management tools in place within the competent court No 0.0 for use by lawyers? Court automation (0-4) 1.0 1. Can the initial complaint be led electronically through a dedicated platform within No 0.0 the competent court? 2. Is it possible to carry out service of process electronically for claims led before the No 0.0 competent court? Page 100   1. Can the initial complaint be led electronically through a dedicated platform within No 0.0 Businesscourt? the competent Doing 2018 Japan 2. Is it possible to carry out service of process electronically for claims led before the No 0.0 competent court? 3. Can court fees be paid electronically within the competent court? No 0.0 4. Publication of judgments 1.0 4.a Are judgments rendered in commercial cases at all levels made available to the Yes general public through publication in o cial gazettes, in newspapers or on the internet or court website? 4.b. Are judgments rendered in commercial cases at the appellate and supreme Yes court level made available to the general public through publication in o cial gazettes, in newspapers or on the internet or court website? Alternative dispute resolution (0-3) 2.5 1. Arbitration 1.5 1.a. Is domestic commercial arbitration governed by a consolidated law or Yes consolidated chapter or section of the applicable code of civil procedure encompassing substantially all its aspects? 1.b. Are there any commercial disputes—aside from those that deal with public No order or public policy—that cannot be submitted to arbitration? 1.c. Are valid arbitration clauses or agreements usually enforced by the courts? Yes 2. Mediation/Conciliation 1.0 2.a. Is voluntary mediation or conciliation available? Yes 2.b. Are mediation, conciliation or both governed by a consolidated law or Yes consolidated chapter or section of the applicable code of civil procedure encompassing substantially all their aspects? 2.c. Are there nancial incentives for parties to attempt mediation or conciliation (i.e., No if mediation or conciliation is successful, a refund of court ling fees, income tax credits or the like)? Resolving Insolvency Doing Business studies the time, cost and outcome of insolvency proceedings involving domestic legal entities. These variables are used to calculate the recovery rate, which is recorded as cents on the dollar recovered by secured creditors through reorganization, liquidation or debt enforcement (foreclosure or receivership) proceedings. To determine the present value of the amount recovered by creditors, Doing Business uses the lending rates from the International Monetary Fund, supplemented with data from central banks and the Economist Intelligence Unit. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Time required to recover debt (years) To make the data on the time, cost and outcome comparable across economies, several assumptions about the business and the case are Measured in calendar years used: Appeals and requests for extension are included - A hotel located in the largest city (or cities) has 201 employees and 50 Cost required to recover debt (% of debtor’s estate) suppliers. The hotel experiences nancial di culties. Page 101   Measured as percentage of estate value - The value of the hotel is 100% of the income per capita or the equivalent if mediation or conciliation is successful, a refund of court ling fees, income tax credits or the like)? Doing Business 2018 Japan Resolving Insolvency Doing Business studies the time, cost and outcome of insolvency proceedings involving domestic legal entities. These variables are used to calculate the recovery rate, which is recorded as cents on the dollar recovered by secured creditors through reorganization, liquidation or debt enforcement (foreclosure or receivership) proceedings. To determine the present value of the amount recovered by creditors, Doing Business uses the lending rates from the International Monetary Fund, supplemented with data from central banks and the Economist Intelligence Unit. The most recent round of data collection for the project was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Time required to recover debt (years) To make the data on the time, cost and outcome comparable across economies, several assumptions about the business and the case are Measured in calendar years used: Appeals and requests for extension are included - A hotel located in the largest city (or cities) has 201 employees and 50 Cost required to recover debt (% of debtor’s estate) suppliers. The hotel experiences nancial di culties. Measured as percentage of estate value - The value of the hotel is 100% of the income per capita or the equivalent Court fees in local currency of USD 200,000, whichever is greater. - The hotel has a loan from a domestic bank, secured by a mortgage over Fees of insolvency administrators the hotel’s real estate. The hotel cannot pay back the loan, but makes Lawyers’ fees enough money to operate otherwise. Assessors’ and auctioneers’ fees In addition, Doing Business evaluates the adequacy and integrity of the Other related fees existing legal framework applicable to liquidation and reorganization Outcome proceedings through the strength of insolvency framework index. The index tests whether economies adopted internationally accepted good Whether business continues operating as a going practices in four areas: commencement of proceedings, management of concern or business assets are sold piecemeal debtor’s assets, reorganization proceedings and creditor participation. Recovery rate for creditors Measures the cents on the dollar recovered by secured creditors Outcome for the business (survival or not) determines the maximum value that can be recovered Official costs of the insolvency proceedings are deducted Depreciation of furniture is taken into account Present value of debt recovered Strength of insolvency framework index (0- 16) Sum of the scores of four component indices: Commencement of proceedings index (0-3) Management of debtor’s assets index (0-6) Reorganization proceedings index (0-3) Creditor participation index (0-4) Resolving Insolvency - Tokyo OECD high OECD high Indicator Tokyo income income Overall Best Performer Recovery rate (cents on the dollar) 92.0 71.2 71.2 93.1 (Norway) Page 102   Creditor participation index (0-4) Doing Business 2018 Japan Resolving Insolvency - Tokyo OECD high OECD high Indicator Tokyo income income Overall Best Performer Recovery rate (cents on the dollar) 92.0 71.2 71.2 93.1 (Norway) Time (years) 0.6 1.7 1.7 0.4 (Ireland) Cost (% of estate) 4.5 9.1 9.1 1.00 (Norway) Outcome (0 as piecemeal sale and 1 as going 1 .. .. .. concern) Strength of insolvency framework index (0-16) 14.0 12.1 12.1 15.00 (6 Economies) Figure – Resolving Insolvency in Japan and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 93.28: Tokyo 91.07: United States (Rank: 3) 89.33: Korea, Rep. (Rank: 5) 78.79: Australia (Rank: 18) Note: The ranking of economies on the ease of resolving insolvency is determined by sorting their distance to frontier scores for resolving insolvency. These scores are the simple average of the distance to frontier scores for the recovery rate and the strength of insolvency framework index. Figure – Resolving Insolvency in Tokyo – Time and Cost Time Cost 1.8 1.7 12 1.6 1.5 10.0 9.1 10 1.4 8.0 Cost (% of estate) 1.2 8 Time (years) 1.0 1.0 1 6 0.8 4.5 0.6 0.6 3.5 4 0.4 2 0.2 0 0 Australia Korea, Rep. OECD high income Tokyo United States Figure – Resolving Insolvency in Tokyo and comparator economies – Measure of Quality Page 103   Tokyo 6 3 2 3 0 0 Australia Korea, Rep. OECD high income Tokyo United States Doing Business 2018 Japan Figure – Resolving Insolvency in Tokyo and comparator economies – Measure of Quality Tokyo 6 3 2 3 Australia 5 2.5 3 0.5 Korea, Rep. 5.5 2.5 3 3 United States 6 3 3 3 OECD high income 5.4 2.8 2.3 1.9 0 2 4 6 8 10 12 14 16 Sub-Indicator Score Management of debtor's assets index (0­6) Commencement of proceedings index (0­3) Creditor participation index (0­4) Reorganization proceedings index (0­3) Figure – Resolving Insolvency in Tokyo and comparator economies – Recovery Rate Recovery Rate (cents on the dollar) 100 92.0 90 82.5 84.7 82.1 80 71.2 70 60 50 40 30 20 10 0 Tokyo Australia Korea, Rep. United States OECD high income Details – Resolving Insolvency in Tokyo Indicator Answer Explanation Proceeding reorganization The most likely procedure applicable to our case study would be a reorganization (civil rehabilitation). Mirage may use the rehabilitation proceeding to gain time, find a new investor, or renegotiate its debt. The rehabilitation proceeding starts with Mirage (debtor) filing for court-supervised rehabilitation with the Tokyo District Court. Mirage’s managers will draft a rehabilitation plan which is likely to be approved by creditors. BizBank will likely support the rehabilitation proceedings as according to the case assumption the continuation of Mirage’s operations as a going concern would fetch 100% of Mirage's market value. Outcome going concern Yes, the hotel will continue operating as a going concern after approval of the rehabilitation plan by creditors. Time (in years) 0.6 Page 104   According to the standard schedule of Tokyo District Court, civil rehabilitation proceedings Tokyo Australia Korea, Rep. United States OECD high income Doing Business 2018 Japan Details – Resolving Insolvency in Tokyo Indicator Answer Explanation Proceeding reorganization The most likely procedure applicable to our case study would be a reorganization (civil rehabilitation). Mirage may use the rehabilitation proceeding to gain time, find a new investor, or renegotiate its debt. The rehabilitation proceeding starts with Mirage (debtor) filing for court-supervised rehabilitation with the Tokyo District Court. Mirage’s managers will draft a rehabilitation plan which is likely to be approved by creditors. BizBank will likely support the rehabilitation proceedings as according to the case assumption the continuation of Mirage’s operations as a going concern would fetch 100% of Mirage's market value. Outcome going concern Yes, the hotel will continue operating as a going concern after approval of the rehabilitation plan by creditors. Time (in years) 0.6 According to the standard schedule of Tokyo District Court, civil rehabilitation proceedings will take approximately 6 to 7 months in total. Immediately after the filing, the court issues a temporary restraining order and supervision order. And, about 1 week after the filing, the court issues the order to commence civil rehabilitation proceedings. After that, creditors will file proofs of claim within about 1 month after the commencement order and Mirage will investigate the proofs of claim. In the meantime, Mirage will evaluate its properties and prepare the rehabilitation plan. The rehabilitation plan will be submitted 3 months after the commencement (the court designates the date). The supervisor will submit his opinion regarding the plan and a creditor's meeting will be convened to approve the plan about 5 months after the commencement. If the rehabilitation plan is approved in the creditor's meeting, the court will issue an order to confirm the approved plan immediately after the meeting. The rehabilitation plan becomes effective about 1 month after the confirmation order. Cost (% of 4.5 Cost incurred during the entire insolvency process mainly include court or government estate) agency fees (1%), attorney fees (2%), costs of notification and publication (<1%), insolvency representative or receiver fees (1%), and fees of accountants, assessors, inspectors and other professionals (<1%). Recovery rate (cents on the 92.0 dollar) Details – Resolving Insolvency in Tokyo – Measure of Quality Answer Score Strength of insolvency framework index (0-16) 14.0 Commencement of proceedings index (0-3) 3.0 What procedures are available to a DEBTOR when commencing insolvency (a) Debtor may 1.0 proceedings? le for both liquidation and reorganization Does the insolvency framework allow a CREDITOR to le for insolvency of the debtor? (a) Yes, a creditor 1.0 may le for both liquidation and reorganization Page 105   What basis for commencement of the insolvency proceedings is allowed under the (c) Both (a) and 1.0 dollar) Doing Business 2018 Japan Details – Resolving Insolvency in Tokyo – Measure of Quality Answer Score Strength of insolvency framework index (0-16) 14.0 Commencement of proceedings index (0-3) 3.0 What procedures are available to a DEBTOR when commencing insolvency (a) Debtor may 1.0 proceedings? le for both liquidation and reorganization Does the insolvency framework allow a CREDITOR to le for insolvency of the debtor? (a) Yes, a creditor 1.0 may le for both liquidation and reorganization What basis for commencement of the insolvency proceedings is allowed under the (c) Both (a) and 1.0 insolvency framework? (b) options are available, but only one of them needs to be complied with Management of debtor's assets index (0-6) 6.0 Does the insolvency framework allow the continuation of contracts supplying essential Yes 1.0 goods and services to the debtor? Does the insolvency framework allow the rejection by the debtor of overly burdensome Yes 1.0 contracts? Does the insolvency framework allow avoidance of preferential transactions? Yes 1.0 Does the insolvency framework allow avoidance of undervalued transactions? Yes 1.0 Does the insolvency framework provide for the possibility of the debtor obtaining credit Yes 1.0 after commencement of insolvency proceedings? Does the insolvency framework assign priority to post-commencement credit? (b) Yes over 1.0 ordinary unsecured creditors but not over secured creditors Reorganization proceedings index (0-3) 3.0 Which creditors vote on the proposed reorganization plan? (b) Only creditors 1.0 whose rights are a ected by the proposed plan Does the insolvency framework require that dissenting creditors in reorganization Yes 1.0 receive at least as much as what they would obtain in a liquidation? Are the creditors devided into classes for the purposes of voting on the reorganization Yes 1.0 plan, does each class vote separately and are creditors in the same class treated Page 106   equally? Does the insolvency framework require that dissenting creditors in reorganization Yes 1.0 receive Doing at least as Business much as 2018 what they would obtain in a liquidation? Japan Are the creditors devided into classes for the purposes of voting on the reorganization Yes 1.0 plan, does each class vote separately and are creditors in the same class treated equally? Creditor participation index (0-4) 2.0 Does the insolvency framework require approval by the creditors for selection or No 0.0 appointment of the insolvency representative? Does the insolvency framework require approval by the creditors for sale of substantial No 0.0 assets of the debtor? Does the insolvency framework provide that a creditor has the right to request Yes 1.0 information from the insolvency representative? Does the insolvency framework provide that a creditor has the right to object to Yes 1.0 decisions accepting or rejecting creditors' claims? Note: Even if the economy’s legal framework includes provisions related to insolvency proceedings (liquidation or reorganization), the economy receives 0 points for the strength of insolvency framework index, if time, cost and outcome indicators are recorded as “no practice”. Resolving Insolvency - Osaka OECD high OECD high Indicator Osaka income income Overall Best Performer Recovery rate (cents on the dollar) 93.0 71.2 71.2 93.1 (Norway) Time (years) 0.6 1.7 1.7 0.4 (Ireland) Cost (% of estate) 3.5 9.1 9.1 1.00 (Norway) Outcome (0 as piecemeal sale and 1 as going 1 .. .. .. concern) Strength of insolvency framework index (0-16) 14.0 12.1 12.1 15.00 (6 Economies) Figure – Resolving Insolvency in Japan and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 93.75: Osaka 91.07: United States (Rank: 3) 89.33: Korea, Rep. (Rank: 5) 78.79: Australia (Rank: 18) Note: The ranking of economies on the ease of resolving insolvency is determined by sorting their distance to frontier scores for resolving insolvency. These scores are the simple average of the distance to frontier scores for the recovery rate and the strength of insolvency framework index. Page 107   the economy receives 0 points for the strength of insolvency framework index, if time, cost and outcome indicators are recorded as “no practice”. Doing Business 2018 Japan Resolving Insolvency - Osaka OECD high OECD high Indicator Osaka income income Overall Best Performer Recovery rate (cents on the dollar) 93.0 71.2 71.2 93.1 (Norway) Time (years) 0.6 1.7 1.7 0.4 (Ireland) Cost (% of estate) 3.5 9.1 9.1 1.00 (Norway) Outcome (0 as piecemeal sale and 1 as going 1 .. .. .. concern) Strength of insolvency framework index (0-16) 14.0 12.1 12.1 15.00 (6 Economies) Figure – Resolving Insolvency in Japan and comparator economies – Ranking and DTF DB 2018 Distance to Frontier (DTF) 0 100 93.75: Osaka 91.07: United States (Rank: 3) 89.33: Korea, Rep. (Rank: 5) 78.79: Australia (Rank: 18) Note: The ranking of economies on the ease of resolving insolvency is determined by sorting their distance to frontier scores for resolving insolvency. These scores are the simple average of the distance to frontier scores for the recovery rate and the strength of insolvency framework index. Figure – Resolving Insolvency in Osaka – Time and Cost Time Cost 1.8 1.7 12 1.6 1.5 10.0 9.1 10 1.4 8.0 Cost (% of estate) 1.2 8 Time (years) 1.0 1.0 1 6 0.8 0.6 0.6 3.5 3.5 4 0.4 2 0.2 0 0 Australia Korea, Rep. OECD high income Osaka United States Figure – Resolving Insolvency in Osaka and comparator economies – Measure of Quality Page 108   0 0 Australia Korea, Rep. OECD high income Osaka United States Doing Business 2018 Japan Figure – Resolving Insolvency in Osaka and comparator economies – Measure of Quality Osaka 6 3 2 3 Australia 5 2.5 3 0.5 Korea, Rep. 5.5 2.5 3 3 United States 6 3 3 3 OECD high income 5.4 2.8 2.3 1.9 0 2 4 6 8 10 12 14 16 Sub-Indicator Score Management of debtor's assets index (0­6) Commencement of proceedings index (0­3) Creditor participation index (0­4) Reorganization proceedings index (0­3) Figure – Resolving Insolvency in Osaka and comparator economies – Recovery Rate Recovery Rate (cents on the dollar) 100 93.0 90 82.5 84.7 82.1 80 71.2 70 60 50 40 30 20 10 0 Osaka Australia Korea, Rep. United States OECD high income Details – Resolving Insolvency in Osaka Indicator Answer Explanation Proceeding reorganization The most likely procedure applicable to our case study would be a reorganization (civil rehabilitation). Mirage may use the rehabilitation proceeding to gain time, find a new investor, or renegotiate its debt. The rehabilitation proceeding starts with Mirage (debtor) filing for court-supervised rehabilitation with the Osaka District Court. Mirage’s managers will draft a rehabilitation plan which is likely to be approved by creditors. BizBank will likely support the rehabilitation proceedings as according to the case assumption the continuation of Mirage’s operations as a going concern would fetch 100% of Mirage's market value. Outcome going concern Yes, the hotel will continue operating as a going concern after approval of the rehabilitation plan by creditors. Time (in years) 0.6 Page 109   A reorganization (civil rehabilitation) procedure will approximately take 7 months in total. Osaka Australia Korea, Rep. United States OECD high income Doing Business 2018 Japan Details – Resolving Insolvency in Osaka Indicator Answer Explanation Proceeding reorganization The most likely procedure applicable to our case study would be a reorganization (civil rehabilitation). Mirage may use the rehabilitation proceeding to gain time, find a new investor, or renegotiate its debt. The rehabilitation proceeding starts with Mirage (debtor) filing for court-supervised rehabilitation with the Osaka District Court. Mirage’s managers will draft a rehabilitation plan which is likely to be approved by creditors. BizBank will likely support the rehabilitation proceedings as according to the case assumption the continuation of Mirage’s operations as a going concern would fetch 100% of Mirage's market value. Outcome going concern Yes, the hotel will continue operating as a going concern after approval of the rehabilitation plan by creditors. Time (in years) 0.6 A reorganization (civil rehabilitation) procedure will approximately take 7 months in total. Creditors will file the proof of claims and, in the meantime, Mirage will prepare the plan. The plan will be submitted 3 months from the commencement (the court designates the date). The supervisor will submit his opinion regarding the plan and a creditors' meeting will be convened to approve the plan. Cost (% of 3.5 The costs associated with the case would amount to approximately 3.5% of the value of the estate) debtor's estate (JPY 13,600,000). Cost incurred during the entire insolvency process mainly include court or government agency fees (1%), attorney fees (up to 2%), costs of notification and publication (<1%), insolvency representative or receiver fees (1%), and fees of accountants, assessors, inspectors and other professionals (<1%). Recovery rate (cents on the 93.0 dollar) Details – Resolving Insolvency in Osaka – Measure of Quality Answer Score Strength of insolvency framework index (0-16) 14.0 Commencement of proceedings index (0-3) 3.0 What procedures are available to a DEBTOR when commencing insolvency (a) Debtor may 1.0 proceedings? le for both liquidation and reorganization Does the insolvency framework allow a CREDITOR to le for insolvency of the debtor? (a) Yes, a creditor 1.0 may le for both liquidation and reorganization What basis for commencement of the insolvency proceedings is allowed under the (c) Both (a) and 1.0 insolvency framework? (b) options are available, but only one of them needs to be complied with Page 110   Management of debtor's assets index (0-6) 6.0 dollar) Doing Business 2018 Japan Details – Resolving Insolvency in Osaka – Measure of Quality Answer Score Strength of insolvency framework index (0-16) 14.0 Commencement of proceedings index (0-3) 3.0 What procedures are available to a DEBTOR when commencing insolvency (a) Debtor may 1.0 proceedings? le for both liquidation and reorganization Does the insolvency framework allow a CREDITOR to le for insolvency of the debtor? (a) Yes, a creditor 1.0 may le for both liquidation and reorganization What basis for commencement of the insolvency proceedings is allowed under the (c) Both (a) and 1.0 insolvency framework? (b) options are available, but only one of them needs to be complied with Management of debtor's assets index (0-6) 6.0 Does the insolvency framework allow the continuation of contracts supplying essential Yes 1.0 goods and services to the debtor? Does the insolvency framework allow the rejection by the debtor of overly burdensome Yes 1.0 contracts? Does the insolvency framework allow avoidance of preferential transactions? Yes 1.0 Does the insolvency framework allow avoidance of undervalued transactions? Yes 1.0 Does the insolvency framework provide for the possibility of the debtor obtaining credit Yes 1.0 after commencement of insolvency proceedings? Does the insolvency framework assign priority to post-commencement credit? (b) Yes over 1.0 ordinary unsecured creditors but not over secured creditors Reorganization proceedings index (0-3) 3.0 Which creditors vote on the proposed reorganization plan? (b) Only creditors 1.0 whose rights are a ected by the proposed plan Does the insolvency framework require that dissenting creditors in reorganization Yes 1.0 receive at least as much as what they would obtain in a liquidation? Are the creditors devided into classes for the purposes of voting on the reorganization Yes 1.0 plan, does each class vote separately and are creditors in the same class treated Page 111   equally? Does the insolvency framework require that dissenting creditors in reorganization Yes 1.0 receive Doing at least as Business much as 2018 what they would obtain in a liquidation? Japan Are the creditors devided into classes for the purposes of voting on the reorganization Yes 1.0 plan, does each class vote separately and are creditors in the same class treated equally? Creditor participation index (0-4) 2.0 Does the insolvency framework require approval by the creditors for selection or No 0.0 appointment of the insolvency representative? Does the insolvency framework require approval by the creditors for sale of substantial No 0.0 assets of the debtor? Does the insolvency framework provide that a creditor has the right to request Yes 1.0 information from the insolvency representative? Does the insolvency framework provide that a creditor has the right to object to Yes 1.0 decisions accepting or rejecting creditors' claims? Note: Even if the economy’s legal framework includes provisions related to insolvency proceedings (liquidation or reorganization), the economy receives 0 points for the strength of insolvency framework index, if time, cost and outcome indicators are recorded as “no practice”. Labor Market Regulation Doing Business presents the data for the labor market regulation indicators in an annex. The report does not present rankings of economies on these indicators or include the topic in the aggregate distance to frontier score or ranking on the ease of doing business. Detailed data collected on labor market regulation are available on the Doing Business website (http://www.doingbusiness.org/data/exploretopics/labor-market-regulation). The most recent round of data collection was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Hiring To make the data comparable across economies, several assumptions (i) whether xed-term contracts are prohibited for about the worker and the business are used. permanent tasks; (ii) maximum cumulative duration of xed-term contracts; (iii) length of the The worker: probationary period; (iv) minimum wage. - Is a cashier in a supermarket or grocery store, age 19, with one year of work experience. Working hours - Is a full-time employee. (i) maximum number of working days allowed per - Is not a member of the labor union, unless membership is mandatory. week; (ii) premiums for work: at night, on a weekly rest day and overtime; (iii) whether there are The business: restrictions on work at night, work on a weekly rest - Is a limited liability company (or the equivalent in the economy). day and for overtime work; (iv) whether nonpregnant - Operates a supermarket or grocery store in the economy’s largest and nonnursing women can work same night hours business city. For 11 economies the data are also collected for the second as men; (v) length of paid annual leave. largest business city. - Has 60 employees. Redundancy rules - Is subject to collective bargaining agreements if such agreements cover (i) whether redundancy can be basis for terminating more than 50% of the food retail sector and they apply even to rms that workers; (ii) whether employer needs to notify are not party to them. and/or get approval from third party to terminate 1 - Abides by every law and regulation but does not grant workers more redundant worker and a group of 9 redundant bene ts than those mandated by law, regulation or (if applicable) collective workers; (iii) whether law requires employer to bargaining agreements. reassign or retrain a worker before making worker redundant; (iv) whether priority rules apply for redundancies and reemployment. Redundancy cost Page 112   (i) notice period for redundancy dismissal; (ii) the economy receives 0 points for the strength of insolvency framework index, if time, cost and outcome indicators are recorded as “no practice”. Doing Business 2018 Japan Labor Market Regulation Doing Business presents the data for the labor market regulation indicators in an annex. The report does not present rankings of economies on these indicators or include the topic in the aggregate distance to frontier score or ranking on the ease of doing business. Detailed data collected on labor market regulation are available on the Doing Business website (http://www.doingbusiness.org/data/exploretopics/labor-market-regulation). The most recent round of data collection was completed in June 2017. See the methodology for more information. What the indicators measure Case study assumptions Hiring To make the data comparable across economies, several assumptions (i) whether xed-term contracts are prohibited for about the worker and the business are used. permanent tasks; (ii) maximum cumulative duration of xed-term contracts; (iii) length of the The worker: probationary period; (iv) minimum wage. - Is a cashier in a supermarket or grocery store, age 19, with one year of work experience. Working hours - Is a full-time employee. (i) maximum number of working days allowed per - Is not a member of the labor union, unless membership is mandatory. week; (ii) premiums for work: at night, on a weekly rest day and overtime; (iii) whether there are The business: restrictions on work at night, work on a weekly rest - Is a limited liability company (or the equivalent in the economy). day and for overtime work; (iv) whether nonpregnant - Operates a supermarket or grocery store in the economy’s largest and nonnursing women can work same night hours business city. For 11 economies the data are also collected for the second as men; (v) length of paid annual leave. largest business city. - Has 60 employees. Redundancy rules - Is subject to collective bargaining agreements if such agreements cover (i) whether redundancy can be basis for terminating more than 50% of the food retail sector and they apply even to rms that workers; (ii) whether employer needs to notify are not party to them. and/or get approval from third party to terminate 1 - Abides by every law and regulation but does not grant workers more redundant worker and a group of 9 redundant bene ts than those mandated by law, regulation or (if applicable) collective workers; (iii) whether law requires employer to bargaining agreements. reassign or retrain a worker before making worker redundant; (iv) whether priority rules apply for redundancies and reemployment. Redundancy cost (i) notice period for redundancy dismissal; (ii) severance payments due when terminating a redundant worker. Job quality (i) whether law mandates equal remuneration for work of equal value and nondiscrimination based on gender in hiring; (ii) whether law mandates paid or unpaid maternity leave; (iii) length of paid maternity leave; (iv) whether employees on maternity leave receive 100% of wages; (v) availability of ve fully paid days of sick leave a year; (vi) eligibility requirements for unemployment protection. Labor Market Regulation - Tokyo Details – Labor Market Regulation in Tokyo Answer Page 113   days of sick leave a year; (vi) eligibility requirements for unemployment protection. Doing Business 2018 Japan Labor Market Regulation - Tokyo Details – Labor Market Regulation in Tokyo Answer Hiring Fixed-term contracts prohibited for permanent tasks? No Maximum length of a single xed-term contract (months) 36.0 Maximum length of xed-term contracts, including renewals (months) No limit Minimum wage applicable to the worker assumed in the case study (US$/month) 1403.3 Ratio of minimum wage to value added per worker 0.3 Maximum length of probationary period (months) n.a. Working hours Standard workday 8.0 Maximum number of working days per week 6.0 Premium for night work (% of hourly pay) 25.0 Premium for work on weekly rest day (% of hourly pay) 35.0 Premium for overtime work (% of hourly pay) 25.0 Restrictions on night work? No Whether nonpregnant and nonnursing women can work the same night hours as men Yes Restrictions on weekly holiday? No Restrictions on overtime work? Yes Paid annual leave for a worker with 1 year of tenure (working days) 10.0 Paid annual leave for a worker with 5 years of tenure (working days) 16.0 Paid annual leave for a worker with 10 years of tenure (working days) 20.0 Paid annual leave (average for workers with 1, 5 and 10 years of tenure, in working days) 15.3 Redundancy rules Dismissal due to redundancy allowed by law? Yes Third-party noti cation if one worker is dismissed? No Third-party approval if one worker is dismissed? No Third-party noti cation if nine workers are dismissed? No Third-party approval if nine workers are dismissed? No Page 114   Third-party Doing cation if Japan noti 2018 Business nine workers are dismissed? No Third-party approval if nine workers are dismissed? No Retraining or reassignment obligation before redundancy? No Priority rules for redundancies? No Priority rules for reemployment? No Redundancy cost Notice period for redundancy dismissal for a worker with 1 year of tenure 4.3 Notice period for redundancy dismissal for a worker with 5 years of tenure 4.3 Notice period for redundancy dismissal for a worker with 10 years of tenure 4.3 Notice period for redundancy dismissal (average for workers with 1, 5 and 10 years of tenure) 4.3 Severance pay for redundancy dismissal for a worker with 1 year of tenure 0.0 Severance pay for redundancy dismissal for a worker with 5 years of tenure 0.0 Severance pay for redundancy dismissal for a worker with 10 years of tenure 0.0 Severance pay for redundancy dismissal (average for workers with 1, 5 and 10 years of tenure) 0.0 Job quality Equal remuneration for work of equal value? No Gender nondiscrimination in hiring? Yes Paid or unpaid maternity leave mandated by law? Yes Minimum length of maternity leave (calendar days)? 98.0 Receive 100% of wages on maternity leave? No Five fully paid days of sick leave a year? No Unemployment protection after one year of employment? Yes Minimum contribution period for unemployment protection (months)? 12.0 Labor Market Regulation - Osaka Details – Labor Market Regulation in Osaka Answer Hiring Fixed-term contracts prohibited for permanent tasks? No Maximum length of a single xed-term contract (months) 36.0 Maximum length of xed-term contracts, including renewals (months) No limit Page 115   Minimum wage applicable to the worker assumed in the case study (US$/month) 1329.5 Minimum contribution period for unemployment protection (months)? 12.0 Doing Business 2018 Japan Labor Market Regulation - Osaka Details – Labor Market Regulation in Osaka Answer Hiring Fixed-term contracts prohibited for permanent tasks? No Maximum length of a single xed-term contract (months) 36.0 Maximum length of xed-term contracts, including renewals (months) No limit Minimum wage applicable to the worker assumed in the case study (US$/month) 1329.5 Ratio of minimum wage to value added per worker 0.3 Maximum length of probationary period (months) n.a. Working hours Standard workday 8.0 Maximum number of working days per week 6.0 Premium for night work (% of hourly pay) 25.0 Premium for work on weekly rest day (% of hourly pay) 35.0 Premium for overtime work (% of hourly pay) 25.0 Restrictions on night work? No Whether nonpregnant and nonnursing women can work the same night hours as men Yes Restrictions on weekly holiday? No Restrictions on overtime work? Yes Paid annual leave for a worker with 1 year of tenure (working days) 10.0 Paid annual leave for a worker with 5 years of tenure (working days) 16.0 Paid annual leave for a worker with 10 years of tenure (working days) 20.0 Paid annual leave (average for workers with 1, 5 and 10 years of tenure, in working days) 15.3 Redundancy rules Dismissal due to redundancy allowed by law? Yes Third-party noti cation if one worker is dismissed? No Third-party approval if one worker is dismissed? No Third-party noti cation if nine workers are dismissed? No Third-party approval if nine workers are dismissed? No Page 116   Third-party Doing cation if Japan noti 2018 Business nine workers are dismissed? No Third-party approval if nine workers are dismissed? No Retraining or reassignment obligation before redundancy? No Priority rules for redundancies? No Priority rules for reemployment? No Redundancy cost Notice period for redundancy dismissal for a worker with 1 year of tenure 4.3 Notice period for redundancy dismissal for a worker with 5 years of tenure 4.3 Notice period for redundancy dismissal for a worker with 10 years of tenure 4.3 Notice period for redundancy dismissal (average for workers with 1, 5 and 10 years of tenure) 4.3 Severance pay for redundancy dismissal for a worker with 1 year of tenure 0.0 Severance pay for redundancy dismissal for a worker with 5 years of tenure 0.0 Severance pay for redundancy dismissal for a worker with 10 years of tenure 0.0 Severance pay for redundancy dismissal (average for workers with 1, 5 and 10 years of tenure) 0.0 Job quality Equal remuneration for work of equal value? No Gender nondiscrimination in hiring? Yes Paid or unpaid maternity leave mandated by law? Yes Minimum length of maternity leave (calendar days)? 98.0 Receive 100% of wages on maternity leave? No Five fully paid days of sick leave a year? No Unemployment protection after one year of employment? Yes Minimum contribution period for unemployment protection (months)? 12.0 Business Reforms in Japan In the year ending June 1, 2017, 119 economies implemented 264 total reforms across the di erent areas measured by Doing Business. Doing Business has recorded more than 2,900 regulatory reforms making it easier to do business since 2004. Reforms inspired by Doing Business have been implemented by economies in all regions. The following are the reforms for Japan implemented since Doing Business 2008. = Doing Business reform making it easier to do business. = Change making it more di cult to do business. DB2018 Paying Taxes: Japan made paying taxes less costly by reducing the statutory rate for corporate income tax and rates for other taxes including mandatory labor contributions. This reforms apply to Osaka and Tokyo. DB2017 the Paying Taxes: Japan made paying taxes easier by disclosing the technical speci cations of the eTax platform and allowingPage 117   upload of additional information in comma separated value (CSV) format. The restoration surtax was also abolished. However, a Minimum contribution period for unemployment protection (months)? 12.0 Doing Business 2018 Japan Business Reforms in Japan In the year ending June 1, 2017, 119 economies implemented 264 total reforms across the di erent areas measured by Doing Business. Doing Business has recorded more than 2,900 regulatory reforms making it easier to do business since 2004. Reforms inspired by Doing Business have been implemented by economies in all regions. The following are the reforms for Japan implemented since Doing Business 2008. = Doing Business reform making it easier to do business. = Change making it more di cult to do business. DB2018 Paying Taxes: Japan made paying taxes less costly by reducing the statutory rate for corporate income tax and rates for other taxes including mandatory labor contributions. This reforms apply to Osaka and Tokyo. DB2017 Paying Taxes: Japan made paying taxes easier by disclosing the technical speci cations of the eTax platform and allowing the upload of additional information in comma separated value (CSV) format. The restoration surtax was also abolished. However, a local corporation tax was introduced and the rates of special local corporation tax, inhabitants tax and enterprise tax were raised. Welfare pension premiums were also raised. These reforms apply to both Tokyo and Osaka. However, the rate for health insurance contributions paid by employers was reduced only in Osaka. DB2013 Paying Taxes: Japan made paying taxes less costly for companies by reducing the corporate income tax rate—though it also introduced a restoration surtax for a 3-year period. DB2012 Dealing with Construction Permits: Japan made dealing with construction permits costlier by increasing inspection fees. DB2011 Resolving Insolvency: Japan made it easier to deal with insolvency by establishing a new entity, the Enterprise Turnaround Initiative Corporation, to support the revitalization of companies su ering from excessive debt but professionally managed. Page 118   Resolving Insolvency: Japan made it easier to deal with insolvency by establishing a new entity, the Enterprise Turnaround Initiative Corporation, Doing Business to support 2018 Japanthe revitalization of companies su ering from excessive debt but professionally managed. Page 119