Tech giants undeterred by paltry Japan fines

TOKYO, 21 June 2022:

Japanese justice minister Yoshihisa Furukawa today said foreign technology giants that have not registered their foreign global headquarters in the country – as required by Japanese law – will be subject to sanctions.

Most of the 48 foreign technology and communication companies operating in the country, which have received a request from authorities to register with the relevant ministries, have not responded satisfactorily – including Google, Meta and Twitter, Furukawa said at a press conference.

Only six of the companies had responded to the request before the registration deadline expired on June 13, while some others responded later, the minister said.

According to Japanese corporate law, foreign companies operating in the country must register their headquarters located abroad – but many technology companies have registered only their Japanese branches, so authorities cannot monitor their activities and determine appropriate taxes.

Local company representatives who do not register, despite intending to do business in the territory, will be subject to a fine of up to ¥1 million (about US$7,400) – a modest penalty some experts say may have contributed to the carelessness of the records.

“We will work with the relevant ministries and agencies, including notifying the courts of infractions, to expedite registration,” Furukawa was quoted as saying by local news agency Kyodo.

Japan seeks to strengthen commercial control over foreign companies and said it considers that in the specific case of network problems, this registry could facilitate the initiation of legal proceedings, by speeding up data requests.