The Media and Entertainment Law Review: Japan

Overview

The size of the Japanese media and entertainment industry market is ¥12,847.6 billion.2

The breakdown by media is as follows:

  1. ¥3,929.1 billion for tangible packages such as CDs, DVDs, Blue-ray and books;
  2. ¥3,561.6 billion for networks focusing on intangible digital content such as video distribution, music distribution and electronic books;
  3. ¥3,541.3 billion for broadcasts; and
  4. ¥1,815.6 billion for theatres and live music clubs.3

Currently, the market share for packages, networks and broadcasts is roughly equal in size, at about 30 per cent each, but the size of the networks market is expected to surpass that of packages in the near future.

One of the characteristics of the Japanese media and entertainment industry is that two of the major participants, broadcasters and newspapers, have strong ties. Historically, Japanese TV stations have developed out of the major newspapers.

The major market participants in broadcasting are NHK, which was established under the Broadcasting Act and provides Japanese public broadcasting, and five nationwide private broadcasting networks (commercial broadcasting): NNN, JNN, FNN, ANN and TXN. Many local broadcasters and newspapers belong to one of these major private networks and are supplied with content by production companies within the network.

Each of these five major networks is affiliated with a major national newspaper, to a greater or less degree. In recent years, because of expansion in the networks market, the presence of new market participants that do not belong to any of the major networks has been gradually increasing.

Recent market trends and policy developments

Along with the expansion of the networks market, measures are currently being taken rapidly because of a major issue for the government: addressing websites enabling users to browse or download illegally uploaded content that infringes copyrights and other rights.

Specifically, the Copyright Act was amended in June 2020 to prohibit both the operation of leech sites, which aggregate links to illegally uploaded works, and the provision of these links; and under certain requirements, downloading illegally uploaded works while knowing they are illegal.

Content generated by artificial intelligence (AI) is not protected under the current Copyright Act unless there exists a creative contribution by a human being during the process of production.

Legal and regulatory framework

i Legal framework for the protection and optimisation of entertainment content

The Act on Promotion of Creation, Protection and Exploitation of Contents (APCPEC) is the basic law concerning media and entertainment.

Article 11 of APCPEC stipulates that the government should implement measures necessary to appropriately protect intellectual property rights related to content. The protection of most intellectual property rights in content is stipulated under the Copyright Act, regardless of differences in media such as print, broadcast and online.

Japan has a statutory law system, in which codified statutory laws (legislation) are the main source of law and classical entertainment content is covered almost entirely by the Copyright Act.

However, the Copyright Act does not cover relatively new entertainment rights such as rights to broadcast sporting events, naming rights of stadiums, rights to use television programme formats, rights to use non-copyrighted data for AI development and content generated by AI without a creative contribution by human beings.

There are some cases where, in the absence of statute, legal protection is recognised by judicial precedent. For example, the Supreme Court of Japan has recognised publicity rights as being protected by judicial precedent, although these rights are not stipulated in laws and regulations.4

As a matter of practice, regarding new rights that are not stipulated in statutory laws, disputes are avoided by contracts between private parties.

The appropriateness of the terms and conditions of such contracts between private persons are regulated under the Antimonopoly Act (i.e., Regulations on Abuse of a Superior Bargaining Position), which is enforced by the Japan Fair Trade Commission, and the Act against Delay in Payment of Subcontract Proceeds, etc. to Subcontractors, which supplements the Antimonopoly Act. The Antimonopoly Act stipulates that legal measures to be taken in the event of violation of its provisions include criminal penalties, monetary penalties and fines, and cease and desist orders.

ii Special regulations for the broadcasting industry

Given that broadcasting industries such as television and radio are highly regulated, they are subject to special legal restraints. In other words, a person who intends to transmit broadcasts on radio waves of frequencies allocated either exclusively or preferentially to broadcasting (basic broadcasting) must obtain a licence from the Minister of Internal Affairs and Communications (a licence may be revoked by the Minister).5 Based on the idea of prioritising Japanese nationals because frequencies are finite and hence rare resources, foreign nationals are restricted from becoming executive officers of a broadcasting station and from collectively holding one-fifth or more of the station's voting rights.

Any person who believes that his or her reputation or privacy has been infringed by a broadcast may, in addition to a request under the Broadcasting Act as mentioned above, file a complaint with the Broadcasting Ethics and Programme Improvement Organisation (BPO), a self-regulatory institution jointly established by NHK and commercial broadcasting stations. If BPO finds an infringement of rights such as reputation and privacy, the broadcaster that was the subject of the complaint must promptly broadcast a correction or an apology pursuant to an agreement among BPO members to the effect that it will broadcast decisions of BPO on the news and other media.

Free speech and media freedom

i Protected forms of expression

No freedom of expression is guaranteed without restriction and forms of expression may be subject to reasonable and unavoidable restrictions for the purposes of public welfare.6 For example, there is opinion to the effect that the extent of the guarantee for sexual expression and commercial speech is weak under Article 21, Paragraph 1, and judicial precedent that is friendly to this opinion exists.7

It is a widely held view that honour (the social evaluation of a particular person) and privacy (interest in one's private life not being disclosed without reason) are guaranteed under the Constitution and there are judicial decisions friendly to this view.8

If an act of expression contains information that infringes honour or privacy, an issue arises as to the relationship between the potentially contradictory rights. The foregoing judicial decisions may be regarded as attempting to draw reasonable conclusions by carefully comparing the interests.

ii Newsgathering

Judicial precedent holds that 'freedom of newsgathering for the press is worthy of full respect in light of the spirit of Article 21 of the Constitution'.9 Accordingly, it can be said that freedom of newsgathering is respected under the Constitution.

In a Supreme Court judgment of 12 June 2008, the issue arose as to whether news agencies must report as expected by news sources. In summary, the judgment found that news sources' expectations concerning a report are not legally protected in principle. However, if the act of newsgathering necessarily imposes a significant burden on a news source, news agencies should explain to the source the nature of any constraints on the content of the report and the source should make decisions about the newsgathering taking account of the agency explanation. On this basis, the expectations of the source concerning the content of the report are legally protected.

The above judicial precedent is consistent with the view that it is not appropriate to broadly and legally protect the expectations of news sources regarding reports because it is often necessary to report against the intentions of persons subject to newsgathering to satisfy the public interest in the news information.

iii Freedom of access to government information

Pursuant to the Information Disclosure Act or information disclosure ordinances, an individual (or news agency) may request the disclosure of documents prepared by officials of administrative agencies in the course of their duties. The administrative organ receiving such a request must disclose the documents under the Information Disclosure Act unless they constitute non-disclosable information (such as personal information, trade secrets or national secrets) under Article 5 of the Act on the principle on disclosure of administrative documents. In addition, information disclosure ordinances often define non-disclosable information similarly to the Information Disclosure Act.

In this regard, the administrative organ must make allegations and meet the burden of proof to establish that the requested documents constitute non-disclosable information.10 A judgment of the Tokyo District Court of 28 February 2006 ruled on a request for disclosure of information on administrative documents related to secret funds for diplomatic purposes that the administrative organ had not met the burden of proof to establish that the relevant documents constituted non-disclosable information.

iv Protection of sources

Concealment of news sources

Regarding the examination of witnesses in criminal cases, a Supreme Court judgment of 6 August 2015 held that whether a newspaper reporter has the right to refuse to testify is a question for the legislature and that no right to refuse to testify exists without legislation to this effect.

With respect to civil cases, however, a judgment of the Supreme Court of 3 October 2006 stated the following:

  • whether a matter constitutes a secret for which testimony may be refused is determined by comparing the detriment that would arise from publication of the secret with the benefit of discovering the truth that would otherwise be sacrificed by refusing testimony and the fairness of a trial; and
  • as the concealment of news sources has an important social value in securing the freedom of newsgathering, a refusal to testify is permitted in principle, unless there are exceptional circumstances.

As discussed above, the framework as to whether there exists a right to refuse to testify differs between criminal and civil trials.

Compulsory submission of newsgathering materials

When newsgathering materials such as videos become subject to an order for submission to a court or are seized by a governmental agency, news sources may worry about their anonymity and as a result it may become more difficult for news agencies to conduct newsgathering activities.

Judicial precedents have held that orders to submit newsgathering materials may be permitted if the necessity of realising a fair criminal case is compared with the impact on freedom of the press and the former exceeds the latter.11

v Private action (injunction against publication)

The following types of private action can be taken to prevent publication: (1) injunctions against publication based on honour and personality rights; (2) injunctions against publication based on the Unfair Competition Prevention Act, Article 3, Paragraph 1 if the publication contains trade secrets; and (3) injunctions based on the Copyright Act, Article 112, Paragraph 1.

When deciding whether an injunction is to be issued against publication on the basis of honour and personality rights, as discussed above, the courts carefully compare the interest of freedom of expression with the interest of honour. In addition, when deciding whether the injunctions at (2) and (3) above are to be issued, the court may conduct a comparison in the same way.

Subsequent action

Claim for damages

A person whose rights are infringed by publication (including any right under the Copyright Act) may claim damages.12

Article 723 of the Civil Code (Recovery in Defamation)

In the case of defamation or damage to honour, an injured party may request the court to order a publisher to implement measures to restore his or her reputation or honour, such as an advertisement with a correction notice, in addition to compensation for damage.13

Article 115 of the Copyright Act: a request for measures to restore honour in cases of infringement of, inter alia, the moral rights of an author

If an author's moral rights are infringed by publication, an author may request appropriate measures to ensure that the author is identified as the author; or appropriate measures to make revisions or to otherwise restore the author's honour or reputation.14

vi Government action against publication

A provisional injunction against publication can be issued by a court after a trial in cases in which a petition has been filed. This can be regarded as a restriction on freedom of expression by the courts against publishers.

On the question of whether an injunction against publication might be issued by a court order of provisional disposition, a Supreme Court judgment of 11 June 1986 held that:

  • as an injunction against publication by a court order of provisional disposition is a prior injunction against acts of expression, such an injunction may only be permitted under stringent and clear requirements;
  • a prior injunction concerning an act of expression such as an evaluation or criticism of a public official or candidate for public office may not be permitted in principle because it is generally a matter of public interest; and
  • a prior injunction may be permitted exceptionally if it is obvious that the content of the expression is neither true nor solely for a purpose of public interest, and a petitioner for a provisional disposition is likely to suffer serious and irreparable damage.

Intellectual property

i Copyright and related rights

The Copyright Act of Japan has a system similar to that of the copyright laws of common law countries. The main characteristics are described below. In addition, Japan is a contracting party to the Berne Convention, the TRIPS Agreement and the WIPO Copyright Treaty.

To protect the interests of authors, the moral rights of authors are regulated separately from copyrights.

In principle, copyrights survive for a period of 70 years after the death of the author.

There are provisions regarding films that presuppose a separation between author and copyright owner.

ii Personality rights

A Supreme Court judgment of 2 February 2012 defines rights of publicity as 'rights deriving from personality rights which exclusively use the power to attract customers possessed by the names or portraits of persons'. In this case, a publisher sold a weekly magazine with an article on dieting using a photograph of the plaintiff entertainers dancing and the entertainers sought compensatory damages on the grounds that the publisher had infringed their rights of publicity.

iii Unfair business practices

On 27 September 2018, the Tokyo District Court ruled that a go-kart rental service named MariCar, in which users drive on public roads wearing costumes of video game characters (such as Mario of the Mario Kart series, game software developed and sold by the plaintiff Nintendo Co, Ltd), constitutes unfair competition under the Unfair Competition Prevention Act.

In light of the facts that MariCar is similar to the trademark Mario Kart, which is widely recognised among Japanese people as indicating a good or business related to the plaintiff's business, and the rental service in question requires users to wear Mario Kart character costumes and drive go-karts on public roads, the rental service was recognised as causing confusion among the Japanese public between the rental service and the plaintiff's business.

This case is noteworthy as one of the few cases in which unfair competition has been recognised in relation to the abuse of the name and abbreviation of a software game series.

Competition and consumer rights

In Japan, the Japan Fair Trade Commission (JFTC) enforces the Antimonopoly Act. On 25 September 2019, the JFTC published materials regarding its efforts in the human resources field and referred to antitrust issues in the entertainment business in those materials.

i Sports business

In the sports business, there are many rules restricting transfers of athletes that in all likelihood were not established with full consideration of their reasonableness and necessity from the perspective of fair and free competition in contracting with athletes. Awareness and understanding of the Antimonopoly Act has been considered to be lacking in the industry's activities. In response to these circumstances, the JFTC has stated the following views on applying the Antimonopoly Act to rules restricting the transfer of athletes in sports leagues and organisations sponsoring competitions:

  • Rules restricting transfers are not necessarily a violation of the Antimonopoly Act, but their reasonableness and necessity are to be determined on a case-by-case basis by comprehensively considering various factors to identify whether the purpose of the rules is reasonable for promoting competition or whether they are appropriate as a means to achieve their purpose.
  • Rules restricting or limiting transfers indefinitely cannot be considered sufficiently reasonable or necessary.

ii The entertainment field

Notably, in the entertainment field, in 2019, the JFTC issued a cautionary warning and referred to the treatment by two major entertainment firms in their handling of entertainers.15

On 17 July 2019, the major entertainment firm Johnny & Associates, Inc, which handles the members of SMAP, a leading pop music group, announced that the firm was being investigated by the JFTC (see the firm's press release 'July 17, 2019 Report on the Press', 17 July 2019). Some media reported that the investigation was conducted in the context that the firm 'had put pressure on TV stations' (cited from the above press release) when former members of SMAP terminated their relationship with the firm.

Again around July 2019, some media reported that the major entertainment firm Yoshimoto Kogyo KK had not concluded a contract for exclusive management with entertainers handled by the firm.16

On 24 July 2019, the Secretary General of the JFTC said at a press conference that 'the situation where the content of agreement was unclear as there had been no contract could trigger acts that may pose a problem under the Antimonopoly Act, such as the abuse of a superior bargaining position'. (However, the JFTC noted that this comment was not related to any particular case).

Digital content

In June 2020, the Act for Partial Amendment to the Copyright Act and the Act Concerning Special Provisions on the Registration of Works of Computer Programming (Amended Copyright Act) was enacted, with regulations related to use of websites and apps for piracy of copyrighted works.

The Copyright Act prior to these amendments prohibited (1) illegally uploading works on the internet without permission of a copyright owner,17 and (2) downloading music or video while knowing that it has been illegally uploaded.18 However, regarding point (2), the prohibition applied only to music and video, and not manga and certain other types of copyrighted works.

As a result, the following conduct became subject to regulation under the Amended Copyright Act:

  • posting links to illegally uploaded works (including infringed works) on leech sites or leech apps,19 which, inter alia, facilitate the use of infringed works by others;20
  • disregarding link information provided by a leech site operator or a leech app provider and failing to delete it despite being able to delete it;21
  • making leech sites or leech apps available to the public (i.e., operation of leech sites or provision of leech apps);22
  • downloading manga and certain other types of copyrighted works (excluding secondary creations or parodies) that meet certain requirements, while knowing that they have been illegally uploaded;23 and
  • continuously or repeatedly downloading manga or certain other types of copyrighted works that meet certain requirements and for which an official version is provided for value (excluding secondary creations or parodies), while knowing that they have been illegally uploaded.24

Contractual disputes

In the Japanese media and entertainment industry, a relatively large number of disputes arise from situations where content is produced before an agreement is concluded.

If a sale of content yields a profit, a dispute arises over profit-sharing between the parties involved, and if a project fails prior to completion or the sale of content is unsuccessful, a dispute arises over the apportionment of losses. Other types of disputes that have recently become problematic include the absence of a contract between entertainers and their exclusive managers clarifying the management terms, and alleged pressure by managers on entertainers to engage in exclusive services for low remuneration. In cases of this kind, the issue of whether there is a breach of the Antimonopoly Act through abuse of superior bargaining position is disputed.

On 24 July 2019, the Secretary General of the Japan Fair Trade Commission when asked at a press conference about the absence of written contracts between large entertainment talent agencies and entertainers replied that lack of clarity in agreements is a problem in competition policy and under the Antimonopoly Act, because it could lead to conduct such as abuse of a superior bargaining position.

In the absence of a contract, it becomes necessary to examine what was agreed through verbal exchanges between the parties. However, this is often difficult to prove because there is no objective record. In cases of this kind, the industry standard practice is applied as a rule to supplement the agreement.25 However, the question of what is standard practice will often become a further issue between the parties, with conflict often becoming protracted and serious.

Because many parties fear that public knowledge of their dispute will lead to reputational damage, private settlement negotiations are preferred over court proceedings, which are open to the public in principle.

If a dispute cannot be settled through settlement negotiations outside court proceedings, it may be settled through litigation or judicial mediation. However, in some cases disputes will be further protracted because a court that is unfamiliar with standard practice in the media and entertainment industry will struggle to determine the nature of the standard.

Year in review

On 2 June 2021, the Act for Amendment to the Copyright Act was issued to promote the use of digital content and to deal with issues related to the spread of covid-19. A key aspect of this amendment is the facilitation of internet distribution of TV programmes. Under the former system, TV broadcast rights and broadcasters' internet distribution rights with regard to works, performances (singing and musical performances) and recordings were defined as separate rights, and the extent of the right holder's right veto was greater for internet distribution rights than for TV broadcast rights. In consequence, in many cases TV programmes could not be distributed on the internet because of the extensive veto of right holders, and permission could not be obtained from right holders who lost contact with broadcasters after the production of TV programmes. As a result of the amendment, however, such TV programmes may be distributed on the internet without the prior permission of the right holder. For balance with TV broadcast rights, content subject to internet distribution as described above is limited to 'internet distribution that can be regarded as the same as TV broadcasting', which means (1) simultaneous internet distribution of TV programmes; (2) distribution that starts before the end of the broadcast (follow-up distribution); and (3) distribution that takes place within a short period after the end of the broadcast (internet distribution of missed programmes) and that is broadcast in a streaming format.

Outlook

In Japan, a system has been established whereby persons harmed by an anonymous post on the internet can make a request to content providers or internet service providers to identify the sender. The victim makes this request in court proceedings under the Provider Liability Limitation Act, and can make a claim for damages or exercise other rights against the sender.

Currently, a revision of the system is being considered to facilitate the identification of the sender and to reduce the procedural burden. In particular, expansion of the scope of the sender information subject to disclosure and the establishment of a framework for non-contentious proceedings (new court procedures) whereby the court decides the appropriateness of disclosure are being examined (see Section VI).

The new non-contentious proceedings are expected to be in operation by the end of 2022.

Footnotes

1 Ryohei Kudo is a partner and Makoto Adachi is an associate at Iwata Godo.

2 Digital Content White Paper 2020 published by the Digital Content Association of Japan (September 2020).

3 id.

4 Minshu Vol. 66, No. 2, p. 89; Supreme Court judgment dated 2 February 2012.

5 Article 93, Paragraph 1 of the Broadcasting Act and others.

6 Supreme Court judgment of 16 March 1993.

7 Supreme Court judgments of 13 March 1957 and 15 February 1961.

8 Supreme Court judgment of 23 June 1966, and Tokyo District Court judgment of 28 September 1964.

9 Supreme Court decision of 26 November 1969.

10 Supreme Court judgment of 8 February 1994.

11 Supreme Court judgments dated 26 November 1969, 30 January 1989 and 9 July 1990.

12 Article 709 of the Civil Code.

13 Article 723 of the Civil Code.

14 Article 115 of the Copyright Act.

15 See also Section VII.

16 JFTC press release 'Record on the Secretary General's Regular Press Conference', 24 July 2019.

17 Articles 21, 23.1 and 119.1.

18 Articles 30.1 and 119.3.

19 As defined in each item of Article 113, Paragraph 2 and Article 113, Paragraph 4 of the Amended Copyright Act.

20 A civil action may be brought pursuant to Article 113, Paragraph 2 of the Amended Copyright Act; furthermore, criminal punishment may be imposed pursuant to Article 120-2, Item 3 of the Amended Copyright Act.

21 A civil action may be brought pursuant to Article 113, Paragraph 3 of the Amended Copyright Act.

22 Criminal punishment may be imposed pursuant to Article 119, Paragraph 2, Items 4 and 5 of the Amended Copyright Act.

23 A civil action may be brought pursuant to Article 30, Paragraph 1, Item 4 and Article 30, Paragraph 2 of the Amended Copyright Act.

24 Criminal punishment may be imposed pursuant to Article 119, Paragraph 3, Item 2 of the Amended Copyright Act.

25 Article 92 of the Civil Code.

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