The Media and Entertainment Law Review: Japan

Overview

i Overview of the Japanese media and entertainment industry

The size of the Japanese media and entertainment industry market is ¥12.659 trillion.

The breakdown by media is as follows:

  1. ¥3,742.2 billion yen for tangible packages such as CDs, DVDs, Blue-ray and books;
  2. ¥3,608.6 billion for networks focusing on intangible digital content such as video distribution, music distribution and electronic books;
  3. ¥3,592.6 billion for broadcasts; and
  4. ¥1,715.6 billion for theatres and live music clubs.

Currently, each market of packages, networks and broadcasts is roughly of an equal size of about 30 per cent, but the market size of networks 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 players, broadcasters and newspapers, have strong ties. Historically, Japanese TV stations have developed out of the major newspapers.

The major players in broadcasting are NHK, which is 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, due to the expansion of the market size of networks, the presence of new players that do not belong to any of these networks has been gradually increasing.

ii 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. The amended Copyright Act came into force in part on 1 October 2020 and will come into force in part on 1 January 2021 (see Section VI).

Content generated by 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 such relatively new entertainment rights as rights to broadcast sporting events, naming rights of stadiums, rights to use formats of television programmes, 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 legal protection is recognised by judicial precedent in the absence of statute laws. For example, the Supreme Court of Japan has recognised publicity rights to be protected by judicial precedent, although such rights are not stipulated under laws and regulations.

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

Broadcasting industries such as television and radio, being highly regulated, 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). Based on the idea of prioritising Japanese nationals because frequencies of radio waves are finite and 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 & Program Improvement Organization (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 it may be subject to reasonable and unavoidable restrictions for the purposes of public welfare. 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 such opinion exists.

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.

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'. 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. The summary of the judgment is as follows:

  1. news sources' expectations concerning a report are not legally protected in principle;
  2. however, if the act of newsgathering necessarily imposes a significant burden on a news source, news agencies explain to the source that the report will have certain content, and the source makes decisions on responding to the newsgathering based on such explanation, the expectations of the source concerning the content of the report are legally protected; and
  3. 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 knowing.

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 request must disclose such documents under the Information Disclosure Act unless they constitute non-disclosable information (such as personal information, trade secrets and national secrets) under Article 5 of the Act (principle on disclosure of administrative documents). In addition, information disclosure ordinances often define non-disclosable information in a manner similar 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. A judgment of the Tokyo District Court of 28 February 2006 ruled that, concerning a request for disclosure of information on administrative documents related to secret funds for diplomatic purposes, the administrative organ had not met its burden of proof on the question of whether the relevant documents constitute 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 such legislation.

With respect to civil cases, however, a judgment of the Supreme Court of 3 October 2006 held as follows:

  1. whether the matter for which testimony is sought constitutes a secret for which testimony may be refused is determined by comparing the detriment arising from publication of the secret, the benefit of discovering a truth that will be sacrificed by refusing testimony and the fairness of a trial; and
  2. 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.

v Private action (injunction against publication)

Here, we consider (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 under (1) above is to be made or not, as discussed above, the courts carefully compare the interest of freedom of expression with the interest of honour. In addition, when deciding whether injunctions under (2) or (3) above are to be made or not, it is considered that 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 (Article 709 of the Civil Code).

Article 723 of the Civil Code (Recovery in Defamation)

In the case of defamation or damage to credit, an injured party may request the court to order a publisher to implement measures to restore his or her reputation or credit, such as an advertisement with a correction notice, in addition to compensation for damages (Article 723 of the Civil Code).

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 (Article 115 of the Copyright Act).

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 as follows:

  1. as an injunction against publication by court order of provisional disposition is a prior injunction against acts of expression, such injunction may only be permitted under stringent and clear requirements;
  2. concerning an act of expression such as an evaluation or criticism of a public official or candidate for public office, a prior injunction may not be permitted in principle because it is generally a matter of public interest; and
  3. a prior injunction may be exceptionally permitted if it is obvious that the content of the expression is not true and is not 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-cart rental service named MariCar, in which users run 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 causes users to wear costumes of characters that appear in Mario Kart and drive go-carts on public roads, such rental service was recognised as causing confusion among the Japanese public between such 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 game software 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 such materials.

i Sports business

In the sports business, there are many rules on restricting transfers of athletes that were not likely established after full consideration of their reasonableness and necessity from the perspective of fair and free competition in acquiring athletes. Awareness and understanding of the Antimonopoly Act may be considered insufficient in the industry's activities. In response to such circumstances, the JFTC has indicated its view as follows on applying the Antimonopoly Act to sports leagues and organisations sponsoring competitions that have rules restricting the transfer of athletes.

Rules on restrictions of transfer are not necessarily a violation of the Antimonopoly Act, but their reasonableness and necessity are determined on a case-by-case basis by comprehensively considering various factors from the standpoint of whether the purpose to be achieved is reasonable for promoting competition, or whether the rules are appropriate as a means to achieve such purpose.

Rules restricting or limiting transfers indefinitely cannot be said to sufficiently recognise reasonableness and necessity.

ii Entertainment field

In the entertainment field, in 2019, it was noteworthy that the JFTC issued a cautionary warning and referred to the treatment by two major entertainment firms of entertainers handled by such firms.

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.

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. On 1 October 2020, part of this Amended Copyright Act came into full force and effect, and on 1 January 2021, the remaining parts will as well.

The Copyright Act prior to these amendments prohibited (1) illegally uploading works on the internet without permission of a copyright owner (Articles 21, 23.1 and 119.1), and (2) downloading music or video while knowing that it has been illegally uploaded (Articles 30.1 and 119.3). However, regarding (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 becomes subject to regulation under the Amended Copyright Act:

  1. posting links to illegally uploaded works, etc. (infringed works, etc.) on leech sites or leech apps (as defined in each item of Article 113, Paragraph 2 and Article 113, Paragraph 4 of the Amended Copyright Act), which facilitates the use of infringed works, etc. by others (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);
  2. leaving link information by a leech site operator or a leech app provider without deleting it despite being able to delete it (a civil action may be brought pursuant to Article 113, Paragraph 3 of the Amended Copyright Act);
  3. making leech sites or leech apps available to the public (that is, operation of leech sites or provision of leech apps; criminal punishment may be imposed pursuant to Article 119, Paragraph 2, Items 4 and 5 of the Amended Copyright Act);
  4. downloading manga and certain other types of copyrighted works (excluding secondary creations or parodies), while knowing that they have been illegally uploaded, that meet certain requirements (a civil action may be brought pursuant to Article 30, Paragraph 1, Item 4 and Article 30, Paragraph 2 of the Amended Copyright Act); and
  5. continuously or repeatedly downloading manga or certain other types of copyrighted works for which an official version is provided for value (excluding secondary creations or parodies), while knowing that it has been illegally uploaded, that meet certain requirements (criminal punishment may be imposed pursuant to Article 119, Paragraph 3, Item 2 of the Amended Copyright Act).

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 that clarifies the terms of management, and alleged pressure by managers on entertainers to engage in exclusive services at low prices. In such cases, the issue of 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 was asked at a press conference about the absence of written contracts between large entertainment talent agencies and entertainers, and 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 such cases, the custom of the industry is applied as a rule to supplement the agreement. However, the question of what the custom is will become a further issue between the parties, and such conflict will often become protracted and serious.

Because many parties fear that if their conflict is known to the public they will suffer reputational damage, private settlement negotiations are preferred over court proceedings, the latter being 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 does not know the custom in the media and entertainment industry will struggle to determine the nature of the custom.

Year in review

The live entertainment market, where people gather at a particular venue for events such as concerts, dramas, musicals and sports, has been devastated by the spread of covid-19.

It has been estimated that due to requests for business suspensions by prefectural governors and voluntary suspensions of businesses based on the Act on Special Measures for Pandemic Influenza and New Infectious Diseases Preparedness and Response, ¥690 billion, which is 77 per cent of the annual live entertainment market of ¥900 billion (from admission fees and other revenue), will disappear for the one-year period from February 2020 to January 2021.

Prefectural governors request facility managers to suspend business under Article 24, Paragraph 9 of the said Act as a first step. If facility managers fail to comply with a request without just cause, governors then request them to suspend business under Article 45, Paragraph 2 of the said Act as a second step; as a third step, governors instruct an individual manager of facilities, etc., to suspend business under Article 45, Paragraph 3. Currently, there are no penalties for those who fail to comply with these requests or instructions. However, prefectural governors are permitted to publicise the names of facilities that are subject to the requests or instructions. In practice, nearly all facilities have followed requests for business suspension or instructions as they fear that publication of their facility's name may pose a reputational risk resulting from intense social criticism.

Outlook

i Revision of the system for requesting the identity of the sender

In Japan, for persons harmed by an anonymous post on the internet, a system has been established whereby a victim makes 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 burden of court procedures. In particular, expansion of the scope of the sender information that is subject to disclosure, as well as the establishment of a framework of non-contentious proceedings (new court procedures) for the court to decide the appropriateness of disclosure, are being examined (see Section VI).

These issues are being examined at the Study Group on Ideal State of Disclosing Sender Information established in the Ministry of Internal Affairs and Communications, and the final report is expected to be published by the end of 2020.

ii Formulation of support menus for covid-19 in the fields of events
and entertainment

According to the intellectual property promotion plan 2020, which was decided and announced by the Intellectual Property Strategy Headquarters of the Prime Minister's Office in May 2020, it is planned that maximum support', including emergency economic measures, will be provided based on the recognition that the sector comprising events, entertainment and the like has been seriously damaged by covid-19. It is anticipated that the support menu will include measures to promote the use of intellectual property rights in events and entertainment both in Japan and abroad. It is necessary to pay close attention to what specific measures will be formulated.

Footnotes

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