What Information to Include for a Japanese Company in the Introductory Clause

The party information you include in the introductory clause should serve to distinguish that party from anyone else bearing that name. But I’m acutely aware that what information you include can depend on the jurisdiction.

This Tuesday, at my Tokyo “Drafting Clearer Contracts” seminar, I heard of another instance of that from Noboru Muranaka, a member of the legal staff at a Japanese telecommunication company. He was kind enough to follow up by email with the following account:

Under article 27 of the Japanese Commercial Registration Act, registration of a company name will be rejected if that name was previously registered and if the applicant has the same business address as that of anyone who previously registered that name. It follows that you can register a company name that has previously been registered as long as you use a business address different from that used by previous registrants.

Of course, using another company’s name to compete unfairly with that company is restricted by Japanese law, including article 8 of the Companies Act, articles 2.(1)(i) and (ii) of the Unfair Competition Prevention Act, the Trademark Act, and so on. So it would be against the law for me to use the name “Nissan Motors Ltd.” with the aim of profiting from any confusion that creates. But if unfair competition isn’t an issue, there’s nothing to prevent my using a name already used by another company.

That’s why this web page shows that 609 Japanese companies have the name “Assist Ltd.” (It’s in Japanese, but if you use Google Translate you’ll get the general idea.)

Usually, in Japanese contracts the introductory clause states the registered name of any party that’s a company, and the signature blocks include company registered addresses, registered names, and names of authorized signatories. Usually, other information that could be used to identify parties (company ID number, tax number, etc.) isn’t included.

So, that’s why if a Japanese company is party to a contract, it’s best to use that company’s registered office to distinguish that company from other Japanese companies with the same name. And you shouldn’t rely on using some other address for that company.

Based on Noboru’s account, for each Japanese company that’s party to a contract, I’d be inclined to include the address of the registered office in the introductory clause, not with the signature blocks. But wouldn’t using a company ID number be more convenient?

Do any other Japanese contracts professionals have anything to add?

About the author

Ken Adams is the leading authority on how to say clearly whatever you want to say in a contract. He’s author of A Manual of Style for Contract Drafting, and he offers online and in-person training around the world. He’s also chief content officer of LegalSifter, Inc., a company that combines artificial intelligence and expertise to assist with review of contracts.

3 thoughts on “What Information to Include for a Japanese Company in the Introductory Clause”

  1. So all those years we were worrying about ‘Japan, Inc.’ we should have been asking ‘Which one?’

    Do Japanese firms with the same name ever contract with each other? If so, do they create short-name defined terms based on their addresses?

    Sounds like a situation ripe for reviving ‘party of the first part’ and ‘party of the second part’.

    • In Japanese contracts, we do use ‘party of the first part’ (甲) and ‘party of the second part’ (乙).

      Japanese contract persons who are familiar with English contracts, especially those who are followers of MSCD, would prefer to use “ABC” or “Employee”. Then, more often than not, the counterpart would change them to ‘party of the first part’ and ‘party of the second part’. In some cases, that’s the only change the counterpart would make.
      Yeah, I would happily agree to the change, as long as s/he accepts the rest of my draft.

  2. Hi, I live in Japan and always learn with this blog and MSCD 3rd ed. The best way to confirm the identity of Japanese corporation is to have registered stamp on contract and also obtain its official certificate of that registered stamp. Every registered company must have registered stamp of the company. It’s very common to do this in contract written in Japanese.

    If it won’t fit the circumstances (some may be reluctant to have stamp upon contract in English), as Ken mentioned, to have company ID is one of the best idea, but I’ve never seen it. In Japan, it’s so rare that there are 2 or more companies of same name in same town/district because it used to be prohibited. And when you newly register a company and if there is another company of same name already registered in same town/district, you might be informed of the fact and you may change the name. So that’s why it’s common to have company name and registered address only.

    But still I agree with your idea, because there’s a pitfall. You shouldn’t rely upon English name of company. In Japan, every corporation must register its name having Kanji that stands for corporation (Kabushiki Kaisha). So we cannot register company name by English only. For example, Japanese corporation, ABC “Kabusiki kaisha (this part is written in Kanji at registration)” has its parent company, ABC Inc., California corporation. ABC “Kabusiki Kaisha” may call it in contract as it wants, as “ABC Co., Ltd.” “ABC K.K.” or “ABC Inc..” And many Japanese companies use, as English name, “Co., Ltd.” or “Inc.” on behalf of “Kabusiki Kaisha.” So when you sign contract showing the other party is “ABC Inc.,” you need to check carefully whether the party is really Japanese company (ABC “Kabusiki Kaisha”) or its parent company (ABC Inc.).


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