JAPAN Law and Practice Contributed by: Satoru Hasumoto, Takahiro Sato and Fuyuki Uchitsu, Mori Hamada
6.17 Right to Occupy After Termination or Expiry of a Lease A tenant is obliged to vacate and return the leased property on or before the expiration or termination of the lease term if the lease is not renewed. The lessor generally does not have to do anything to ensure that the tenant vacates the property on time, provided the lease duly expires or terminates. Howev - er, there is a special requirement in a fixed-term build - ing lease that the lessor must provide written notice of the expiry of the lease term between six months and one year prior to the expiry date in order to oblige the tenant to vacate the leased property by the end of the lease term. 6.18 Right to Assign a Leasehold Interest A tenant may assign its leasehold interest in the lease or sublease all, or a portion, of the leased premises if Lease agreements typically provide that the following events give the landlord a right to terminate the lease: • a breach of obligation by the tenant, such as a failure to pay rent; • the commencement of an insolvency procedure by the tenant; • the occurrence of events that constitute grounds for the commencement of an insolvency proce - dure, such as being “unable to pay” (ie, unable to pay debts generally when they fall due); and • the issuance of an order for compulsory execution, a petition for auction sale or compulsory disposi - tion for delinquent public charges. it is able to obtain the owner’s approval. 6.19 Right to Terminate a Lease Having said this, the court takes the view that the les - sor is only entitled to terminate the lease if the tenant’s breach amounts to a destruction of the relationship of trust between the lessor and the tenant, regardless of any provision in the lease agreement. A statutory right to terminate in the case of the ten - ant’s insolvency is discussed in 6.15 Effect of the Ten - ant’s Insolvency .
6.20 Registration Requirements A fixed-term land lease and a fixed-term building lease must be made in writing (see 6.2 Types of Commer- cial Leases ). A leasehold interest in the land must be registered pursuant to the real estate registration system in order for it to be perfected. However, if the lessee owns a building standing on the land, the lessee may perfect its leasehold interest in the land by registering its own - ership of the building. A leasehold interest in a building may also be per - fected by registering it under the real estate registra - tion system or by the landlord delivering the subject building to the tenant. In this case, the tenant can assert its leasehold interest against any person who acquires the building after delivery. Registration of a leasehold interest is subject to a reg - istration and licence tax at a rate of 0.4% of the tax - In order to force a tenant to leave, the lessor must obtain a court judgment ordering the tenant to vacate the leased property on the basis of the termination of the lease first. If the tenant does not comply with the judgment, the lessor will need to file a petition for compulsory enforcement against the tenant to compel them to surrender the leased property. The time required to obtain such a judgment and to complete compulsory enforcement largely depends on the tenant’s response in court hearings and reac - tion to the requirement to surrender, and can range from a few months to one year. 6.22 Termination by a Third Party Leases cannot be terminated by any third party, includ - ing the central government or municipal authorities. 6.23 Remedies/Damages for Breach In principle, there are no specific regulations or laws that limit the damages a landlord may collect or rem - edies a landlord may pursue. However, even if a lease agreement provides that the tenant will have to pay rent for the remaining lease term as a penalty in case able base of the property. 6.21 Forced Eviction
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