The Methods of Debt Collection in Japan and What Each One Is Good For

When a debtor in Japan stops paying, litigation is not the only option, nor usually the first. Japanese law offers a graded set of procedures running from an informal request to compulsory execution, and they differ sharply in the time they take, what they cost, the pressure they place on the other party and the situations they suit. Choosing badly wastes both time and money while the debtor’s assets continue to drain away. What follows compares the principal methods under Japanese law.

Contents

Negotiation and formal demand
The lighter court procedures
Establishing the claim by judgment
Securing the assets and realising the claim
Where the assets cannot be found
In closing: how to choose
How to contact us

Negotiation and formal demand

A telephone call, a meeting and a reminder letter cost almost nothing beyond staff time and postage, and produce an answer within days or weeks. Where the debtor still intends to pay and the amount is not seriously disputed, this remains the most efficient route. It carries no compulsion whatsoever.

The next step up is content-certified mail (naiyo-shomei yubin), a Japanese postal system under which the post office certifies both the contents of the letter and the date of delivery, at a cost of a few thousand yen. It raises the pressure appreciably, and under the Civil Code of Japan a demand postpones the completion of extinctive prescription for six months. It is the natural last demand before proceedings, and serves later as evidence.

The lighter court procedures

Civil conciliation is conducted before conciliation commissioners at the Summary Court. The filing fee is about half that of litigation and the matter usually closes within two to four months. If a settlement is reached, the record of conciliation has the same effect as a final judgment and is itself an enforceable title. If the debtor fails to attend or refuses to agree, the procedure simply ends. It suits a debtor who is still willing to talk, or a case likely to end in instalments.

A demand for payment (shiharai-tokusoku, a procedure peculiar to Japan) is applied for to a court clerk of the Summary Court and issued without any hearing at all. The fee is half that of an ordinary action and an enforceable title can be obtained in two to three months. But the application must be made to the Summary Court for the debtor’s address, and an objection filed within two weeks converts the matter into ordinary litigation. It suits claims that are clear in amount and unlikely to be contested.

A small-claims action covers monetary claims of up to 600,000 yen, is heard and decided at a single hearing as a rule, and carries a declaration of provisional execution. It may be used ten times a year in the same Summary Court, and the debtor may require transfer to ordinary proceedings. It suits modest sums supported by clear documents on a single issue.

Establishing the claim by judgment

Ordinary litigation has no ceiling. The filing fee rises with the value of the claim — 10,000 yen on a claim of one million yen, 50,000 yen on ten million. First instance commonly takes six months to somewhat over a year, longer where the defence is vigorous. The debtor will usually have to instruct counsel, so the pressure is greater than in any other procedure, and settlements in court are frequently reached along the way. It suits substantial sums, several disputed issues, or a debtor who denies everything.

An action on bills and cheques (tegata-kogitte sosho) is confined to claims for payment on promissory notes, bills of exchange and cheques. Evidence is in principle limited to documents, judgment usually follows a single hearing, and a declaration of provisional execution is always attached, so recovery is very fast. The defendant may object and move the case into ordinary proceedings. The use of bills within Japan has been declining year by year, and the scope for this procedure with it.

Securing the assets and realising the claim

The provisional remedy most often used is provisional attachment (kari-sashiosae), which freezes the debtor’s bank deposits, accounts receivable or real property before or during the action. The right to be preserved and the necessity of preservation must be shown, and a security bond deposited with the Legal Affairs Bureau, in practice commonly ten to thirty per cent of the sum claimed. An order usually issues within one to three weeks. Because the debtor is not notified in advance, the effect is abrupt, and a debtor whose deposits are frozen very often returns to the table. It suits cases where assets may be concealed or where the debtor’s position is visibly deteriorating.

Compulsory execution requires an enforceable title first — a judgment, a settlement record, a record of conciliation or a demand for payment. Bank deposits, accounts receivable, real property and movables may all be attached. Execution against claims is the quickest: one week after the attachment order is served on the debtor, the creditor may collect directly from the bank. The court fees themselves are small, but execution against immovables requires an advance payment of some hundreds of thousands of yen and the sale takes considerable time.

Where the assets cannot be found

The property disclosure procedure allows the court to order the debtor to appear and state what he owns; failure to appear without justification, or a false statement, is punishable by imprisonment of up to six months or a fine of up to 500,000 yen. The separate procedure for obtaining information from third parties yields deposit information from financial institutions and real property information from the registry. Both presuppose an enforceable title, so one of the earlier steps must be completed first.

In closing: how to choose

The size of the claim, the extent of the dispute, and the debtor’s means and good faith together dictate the remedy. A small undisputed claim points to a demand for payment or a small-claims action; a debtor still prepared to negotiate, to conciliation; a risk of dissipation, to provisional attachment followed by suit; a genuinely contested case, to ordinary litigation. Whichever is chosen, what delay consumes is the debtor’s remaining assets.

How to contact us

Telephone 03-6435-8418 within Japan, or +81-3-6435-8418 from overseas. Lines are open from 08:00 to 24:00 Japan time, including Saturdays, Sundays and public holidays. Enquiries are also received at any hour through the form on this site.

M&A Partners Law Office LPC　Katsuhiro Tsuchiya, Representative Attorney-at-Law (Tokyo Bar Association, Registration No. 26775)　17F Mori Trust Shiroyama Trust Tower, 4-3-1 Toranomon, Minato-ku, Tokyo, Japan

This article is a general explanation based on the laws and practice of Japan as at August 2026 (Reiwa 8). The outcome of any particular matter depends on its own facts, and no specific result is guaranteed.

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