Sanctions 2025

JAPAN Law and Practice Contributed by: Eiji Kobayashi, Masaki Fujita, Suguru Yokoi and Ryusuke Bushimata, Anderson Mori & Tomotsune

that the clams were of Russian origin, using a forged certificate of origin. He did not contest the charge. The company was not prosecuted. In October 2024, a Japanese trading company was fined JPY5 million, and its Russian national CEO received a three-year prison sentence (with a four-year suspension), for the unauthorised export of motorcy - cles and other goods (valued at JPY42 million) to Rus - sia via South Korea during a period ending in January 2023. The defendants did not contest the charge. This case was the first criminal conviction for a violation of sanctions against Russia. In March 2025, it was reported that a Japanese used car dealership and two employees of an affiliated company were referred for prosecution on charges of unauthorised exports to Russia, with the employ - ees pleading guilty. The investigation is ongoing into the foreign beneficial owner of the dealership, who departed Japan in June 2023 following a site inspec - tion. According to the reports, the dealership exported four luxury cars, with a total value of JPY85 million, to Russia between December 2022 and January 2023 without obtaining the necessary approval. The deal - ership declared to customs that the cars were being exported to a company in South Korea; however, they were ultimately transported to Vladivostok, Russia, via South Korea. 2.2.5 Mitigation No legislative provision or official guidance clarifies any mitigating steps in the case of a breach of sanc - tions. However, self-reviewing, self-reporting and the establishment of preventive measures may be taken into account when the competent authorities deter - mine penalties. 2.2.6 “Strict Liability” The competent authorities have discretion in deter - mining penalties and can take into account whether the breaching party had knowledge or should have had knowledge that it was in breach of sanctions. Depending on the situation or the seriousness of the consequences resulting from a breach of sanctions, the authorities may choose not to impose penalties, opting instead to issue an administrative directive or merely a warning without any formal punishment.

In the case of criminal liability, knowledge is essential in establishing responsibility for a breach of sanctions. In 2018, the court found a Japanese trading company and its employee in the company’s export division innocent in a criminal case where fabrics were, sev - eral times, exported to a northern port of China from Japan under contracts between the Japanese trading company and a Chinese company, the final destina - tion of the fabrics being North Korea. The main argu - ment centred on whether the employee was aware that the fabrics would be ultimately delivered to North Korea. It was concluded that the employee was not aware and was therefore found not guilty. Japanese sanctions are implemented not by way of prohibiting certain actions or transactions, but by way of requiring the approval or permission of the compe - tent authorities to conduct certain actions or transac - tions for which permission is, as a rule, not normally granted. In exceptional cases, the competent authorities may set exemptions or grant an approval or permission. No provision of legislation clearly states on which grounds the competent authorities may do so. Financial Sanctions The MOF exempts, on humanitarian grounds, pay - ments to individuals in North Korea from the require - ment to obtain permission. 2.3 Licensing 2.3.1 Derogation Japanese Sanctions Measures In the case of sanctions on investment in Russia, exemptions have not been established, but there is the possibility of the MOF granting permission if a Japanese company were to make additional invest - ments in its Russian subsidiary for the sole purpose of maintaining the Russian operation or of exiting from the Russian market, which would otherwise violate financial sanctions. Trade Sanctions METI has issued a general guideline on the operation of general export controls, which sets out when METI can or cannot grant approvals.

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