Bankruptcy Act

• With the opening order the court appoints a bankruptcy trustee (破産管財人), and everything the bankrupt owns at that moment, in Japan or abroad, becomes the bankruptcy estate (破産財団), which only the trustee may manage and dispose of. Left out of the estate are cash up to one and a half times the amount Article 131, item 3 of the Civil Enforcement Act (民事執行法), a separate Act, sets, and, with some exceptions, property that cannot be seized; until a month after the opening order becomes final, the court may widen what is left out, on the bankrupt's application or of its own motion, in view of how the bankrupt lives and can earn.(Art. 31(1), Art. 34(1), Art. 34(3), Art. 34(4), Art. 78(1)) (the provisions it rests on)
• Claims to property against the bankrupt arising from causes before the opening, other than claims on the estate, are bankruptcy claims (破産債権): unless the Act provides otherwise they can be enforced only through the proceedings, by filing them with the court within the period it sets — a creditor who through no fault of their own could not file before the general examination of claims ended has a month after the obstacle ends — and are paid by distribution (配当) from the estate: by rank, preferred claims (優先的破産債権) first, then ordinary claims, then subordinate ones such as interest arising after the opening, then those agreed to rank last, and within a rank in proportion to their amounts. Claims on the estate (財団債権) — among them court costs incurred in the creditors' common interest, the costs of managing, selling and distributing the estate, taxes arising before the opening that were not yet due or less than a year overdue at the opening, and claims arising from the trustee's acts — are paid from the estate at any time, outside the proceedings and ahead of bankruptcy claims; if the estate cannot pay them all, they are paid in proportion to their amounts, those court costs and estate costs first.(Art. 2(5), Art. 100(1), Art. 111(1), Art. 112(1), Art. 193(1), Art. 194(1), Art. 194(2), Art. 97(1), Art. 99(1), Art. 99(2), Art. 2(7), Art. 148(1), Art. 151(1), Art. 152(1), Art. 152(2)) (the provisions it rests on)
• An employee's (使用人) salary for the three months before the proceedings opened is a claim on the estate (財団債権), and so is the retirement allowance of an employee who leaves before the proceedings end, up to three months' salary — the three months before leaving, or the three months before the opening if those come to more. The other claims arising from the employment, which the Civil Code (民法) secures with a general statutory lien (一般の先取特権) over the employer's whole property, are preferred bankruptcy claims (優先的破産債権), paid ahead of ordinary bankruptcy claims.(Art. 149(1), Art. 149(2), Art. 98(1), Civil Code Art. 306(1), Civil Code Art. 308(1)) (the provisions it rests on)
• Separately, under the Act on Ensuring Wage Payment (賃金の支払の確保等に関する法律), where the employer of a business covered by workers' accident compensation insurance, who had run it for at least a period a Ministry of Health, Labour and Welfare Order sets, becomes subject to an order opening bankruptcy proceedings, the government pays on the employer's behalf, at the request of a worker who left the business within a period a Cabinet Order sets, the part of their unpaid wages a Cabinet Order sets; some workers must first have the amount confirmed by the chief of a Labour Standards Inspection Office (労働基準監督署長), as a Ministry of Health, Labour and Welfare Order provides.(Act on Ensuring Wage Payment Art. 7(1)) (the provisions it rests on)
• An individual debtor can apply to the bankruptcy court for a discharge (免責) from the day of the bankruptcy petition until a month after the opening order becomes final — or, if through no fault of their own they could not apply in that time, within a month after the obstacle ends — and one who petitions for their own bankruptcy is treated as applying at the same time unless they say otherwise; once they have applied, they can no longer seek a discontinuance by the creditors' consent or civil rehabilitation. The court grants it unless one of the grounds Article 252(1) lists applies — among them hiding, damaging or disposing of property to the creditors' disadvantage to harm them, waste or gambling that greatly reduced their property or ran up excessive debt, a false list of creditors, refusing to explain or lying in the court's inquiry, obstructing the trustee by dishonest means, breaking the duties the Act places on them (to explain, to list their property, to cooperate with the inquiry into the discharge), or applying within seven years of an earlier discharge becoming final (or of some rehabilitation plans under the Civil Rehabilitation Act (民事再生法), a separate Act) — and even then it may grant it, in view of how the bankruptcy came about and all other circumstances.(Art. 248(1), Art. 248(2), Art. 248(4), Art. 248(6), Art. 252(1), Art. 252(2)) (the provisions it rests on)
• Once a discharge is final, the bankrupt is freed from liability for bankruptcy claims, apart from what the distribution paid, except: taxes and other claims collected the way national taxes are (other than foreign taxes collected under mutual assistance); damages for a tort committed in bad faith, or for injuring someone's life or body intentionally or by gross negligence; claims under the duties of support between spouses, of sharing the costs of married life, of custody of a child and of support of relatives, and similar duties under a contract; employees' claims from the employment and their deposits held by the bankrupt; claims the bankrupt knowingly left off the list of creditors, unless the creditor knew of the bankruptcy; and fines and similar penalties. It does not affect what creditors can claim from a guarantor or a co-debtor, or security that someone other than the bankrupt gave. The bankrupt's rights are restored (復権) by a final discharge, a final discontinuance with the creditors' consent, a confirmed rehabilitation plan under the Civil Rehabilitation Act (民事再生法), a separate Act, ten years from the opening without a conviction for fraudulent bankruptcy, or an order the court must make on the bankrupt's application once they have been freed from all their debts to creditors by paying them or otherwise; the restoration of rights (復権) by a discharge or a plan is lost from then on if it is revoked, and what is restored is for the laws on each qualification to say.(Art. 253(1), Art. 253(2), Art. 255(1), Art. 255(2), Art. 255(3), Art. 256(1)) (the provisions it rests on)

• 21 May 2026

  Act Partially Amending the Code of Civil Procedure, etc.

  民事訴訟法等の一部を改正する法律

  Act No. 48 of 2022The text after this amendment, on e-Gov

• 21 May 2026

  The text on this site

  Act on the Arrangement of Related Acts to Promote the Use of Information and Communications Technology in Civil Procedures, etc.

  民事関係手続等における情報通信技術の活用等の推進を図るための関係法律の整備に関する法律

  Act No. 53 of 2023The text after this amendment, on e-Gov

• 1 April 2026

  Act Partially Amending the Civil Code, etc.

  民法等の一部を改正する法律

  Act No. 33 of 2024The text after this amendment, on e-Gov

• 1 October 2025

  Act on the Arrangement of Related Acts to Promote the Use of Information and Communications Technology in Civil Procedures, etc.

  民事関係手続等における情報通信技術の活用等の推進を図るための関係法律の整備に関する法律

  Act No. 53 of 2023The text after this amendment, on e-Gov

• 1 June 2025

  Act on the Arrangement of Related Acts upon the Enforcement of the Act Partially Amending the Penal Code, etc.

  刑法等の一部を改正する法律の施行に伴う関係法律の整理等に関する法律

  Act No. 68 of 2022The text after this amendment, on e-Gov

• 18 November 2024

  Act on Carbon Dioxide Storage Business

  二酸化炭素の貯留事業に関する法律

  Act No. 38 of 2024The text after this amendment, on e-Gov

• 24 May 2024

  Act Partially Amending the Civil Code, etc.

  民法等の一部を改正する法律

  Act No. 33 of 2024The text after this amendment, on e-Gov

• 24 May 2024

  Act on Carbon Dioxide Storage Business

  二酸化炭素の貯留事業に関する法律

  Act No. 38 of 2024The text after this amendment, on e-Gov

• 1 April 2024

  Act Partially Amending the Fishing Port and Fishing Ground Development Act and the Fishery Industry Cooperative Act

  漁港漁場整備法及び水産業協同組合法の一部を改正する法律

  Act No. 34 of 2023The text after this amendment, on e-Gov

• 1 March 2024

  Act Partially Amending the Code of Civil Procedure, etc.

  民事訴訟法等の一部を改正する法律

  Act No. 48 of 2022The text after this amendment, on e-Gov

All 24 amendments already in force

• Holders of a special statutory lien, pledge or mortgage over estate property have a right of separate satisfaction (別除権): they can enforce it outside the proceedings and claim in the proceedings only for what it leaves unpaid; a right of retention (留置権) under the Commercial Code (商法) or the Companies Act (会社法), separate Acts, counts against the estate as a special statutory lien ranking after the others, and any other right of retention loses its effect against the estate. Where it serves the creditors' general interest, the trustee can, with the court's permission, sell such property and extinguish every security right on it by having the price, less any part proposed for the estate after consulting the secured creditors, paid into court, unless that would unfairly harm them; a secured creditor who objects can, within a month, show the court it has applied to enforce its security, which makes the court refuse, or offer, for itself or another, to buy for at least one-twentieth more, in which case the sale goes to the highest offer.(Art. 2(9), Art. 65(1), Art. 108(1), Art. 66(1), Art. 66(2), Art. 66(3), Art. 186(1), Art. 186(2), Art. 187(1), Art. 188(1), Art. 188(3), Art. 188(8), Art. 189(1)) (the provisions it rests on)
• The opening does not affect the right of an owner to take back property that is not the bankrupt's (取戻権). A seller who has shipped goods to a buyer who has neither paid in full nor received them at the destination when the buyer's proceedings open can take them back too, unless the trustee pays the full price and claims them.(Art. 62(1), Art. 63(1)) (the provisions it rests on)
• A bankruptcy creditor who owes the bankrupt a debt at the opening can set the two off outside the proceedings. It cannot where it took on the debt after the opening, or, in the cases Article 71(1), items 2 to 4, list, after the bankrupt became unable to pay, stopped paying (unless it was not in fact unable to pay then) or was petitioned against, knowing of that at the time — unless the debt arose by operation of law, from a cause before it knew, or from a cause more than a year before the petition — and similar limits bar a debtor of the bankrupt from setting off a bankruptcy claim it acquired.(Art. 67(1), Art. 71(1), Art. 71(2), Art. 72(1), Art. 72(2)) (the provisions it rests on)
• Taxes and other claims collected the way national taxes are that are bankruptcy claims, other than foreign taxes collected under mutual assistance, can still be collected by a national tax delinquency disposition (国税滞納処分) already made against estate property at the opening, or by setting refunds against them. Taxes and fines that are bankruptcy claims are not examined like other claims; where the disposition behind a tax can be challenged by a request for review (審査請求), a lawsuit or another appeal, the trustee contests the claim that way.(Art. 43(2), Art. 100(2), Art. 134(1), Art. 134(2)) (the provisions it rests on)
• Before the first distribution is permitted, the court may, on the trustee's application or of its own motion, allow a preferred claim for salary or a retirement allowance to be paid early, in whole or in part, to an employee who filed it and would otherwise struggle to make a living, as long as that does not harm those holding claims on the estate or preferred claims of equal or higher rank. The trustee must report to the court at once when such an employee asks for this, and must try to give employees with salary or retirement-allowance claims the information they need to take part in the proceedings.(Art. 101(1), Art. 101(2), Art. 86(1)) (the provisions it rests on)
• Where neither side has fully performed a two-sided contract (双務契約) at the opening, the trustee can cancel it, or perform it and demand performance; the other side can set a reasonable period for the trustee to choose, silence counting as cancellation, and claims its damages as a bankruptcy creditor. The trustee cannot cancel in this way a lease or other right of use that the other side has registered or otherwise made good against third parties, and that side's claims under it are claims on the estate.(Art. 53(1), Art. 53(2), Art. 54(1), Art. 56(1), Art. 56(2)) (the provisions it rests on)
• When an employer is declared bankrupt, the Civil Code (民法) lets the worker or the trustee give notice to end the employment as if it had no fixed term, even where it has one, without either owing the other damages for ending it; the employment then ends two weeks after the notice. The worker can set the trustee a period to say whether it will give that notice, and silence counts as giving it. The rule that a supplier under a continuing contract cannot stop supplying because bills from before the petition are unpaid does not apply to labour contracts.(Art. 53(3), Art. 53(2), Civil Code Art. 631(1), Civil Code Art. 627(1), Art. 55(1), Art. 55(3)) (the provisions it rests on)

• Bankruptcy cases go to a district court (地方裁判所) — normally the one for the debtor's main place of business or, for a debtor without one, the debtor's general venue (普通裁判籍) — and the court the Act names is the only one that can hear them. The court may decide without oral argument and may investigate on its own; its decisions can be challenged only where the Act allows, by an immediate appeal (即時抗告), within two weeks of the public notice where one was given. Public notices under the Act are made in the Official Gazette (官報).(Art. 2(3), Art. 5(1), Art. 6(1), Art. 8(1), Art. 8(2), Art. 9(1), Art. 10(1)) (the provisions it rests on)
• Except where the Act provides otherwise, Parts 1 to 4 of the Code of Civil Procedure (民事訴訟法) apply to the proceedings as far as their nature allows, leaving out the provisions Article 13 lists and reading some others as the Appended Table (別表) rewords them, mostly so that they refer to paper documents and records in place of electronic ones. This applies until a day a Cabinet Order sets, no later than 13 June 2028, from which nothing is left out and the Appended Table goes.This is the rule until the change takes effect, 13 June 2028 at the latest.(Art. 13(1), Appended Table 1, Suppl. Prov.(1)) (the provisions it rests on)
• From a day a Cabinet Order sets, no later than 13 June 2028, Parts 1 to 4 of the Code of Civil Procedure (民事訴訟法) apply to the proceedings, except where the Act provides otherwise and as far as their nature allows, with none of them left out. Article 132-11(1)(i) of that Code, under which an agent appointed to act in a case must file through the courts' electronic system, is read to mean such agents who are lawyers (弁護士), and also those appointed as bankruptcy trustee, temporary administrator (保全管理人) or a deputy of either.This is the rule from a day still to be set, 13 June 2028 at the latest.(Art. 13(1), Suppl. Prov.(1), Code of Civil Procedure Art. 132-11(1)) (the provisions it rests on)
• Once a petition is filed and until it is decided, the court may, where necessary, on an interested person's application or of its own motion, stay compulsory execution and certain other proceedings already begun against the debtor's property — an execution, or a disposition for a foreign tax, only if that would not unduly harm the creditor or authority that began it — and order provisional measures over that property, such as a ban on disposing of it. Where special circumstances make a stay not enough, it may issue a comprehensive stay order (包括的禁止命令) forbidding all creditors to enforce against the debtor's property or to collect national tax delinquencies from it, provided it has also ordered provisional measures over the debtor's main property or put the debtor's property under a temporary administrator (保全管理人). A temporary administrator can be appointed only for a corporate debtor, where its property is managed or disposed of improperly or that is otherwise especially needed to secure it.(Art. 24(1), Art. 28(1), Art. 25(1), Art. 91(1)) (the provisions it rests on)
• Once the proceedings open, creditors can no longer begin compulsory execution, provisional seizure or similar enforcement against the estate's property on bankruptcy claims or claims on the estate, and such enforcement already begun loses its effect against the estate, though the trustee may continue a compulsory execution or the enforcement of a general statutory lien for the estate. A national tax delinquency disposition (国税滞納処分) cannot be begun against the estate either, though one already made may continue, and lawsuits about the estate to which the bankrupt is a party are interrupted (中断), for the trustee to take over those that do not concern bankruptcy claims.(Art. 42(1), Art. 42(2), Art. 43(1), Art. 43(2), Art. 44(1), Art. 44(2)) (the provisions it rests on)
• The bankrupt may not leave their place of residence without the court's permission, and the court may have them — or, before the opening, the debtor — brought before it under a warrant (引致); both rules also cover a bankrupt's statutory agent and manager and the directors and similar officers of a bankrupt corporation. The bankrupt must submit to the court, without delay after the opening, a document listing their real estate, cash, securities, deposits and other property the court names. The court may have mail addressed to the bankrupt delivered to the trustee, who may open it, and the bankrupt can ask to see it and to be given what does not concern the estate.(Art. 37(1), Art. 38(1), Art. 38(2), Art. 38(3), Art. 39(1), Art. 41(1), Art. 81(1), Art. 82(1), Art. 82(2)) (the provisions it rests on)
• The court appoints and supervises the trustee — a corporation can be one — and can dismiss one who does not manage the estate properly or for another serious reason; on the trustee's application, after hearing the bankrupt, it can order the bankrupt to hand estate property over to the trustee, an order that takes effect once final, and a trustee who meets resistance may, with its permission, ask the police for help. The trustee needs the court's permission for selling real estate or intellectual property, transferring the business, borrowing, suing, settling and the other acts Article 78(2) lists, some of which need none below a value Rules of the Supreme Court (最高裁判所規則) set; an act done without it is void, though not against a third party who did not know. The trustee must act with the care of a prudent manager, and is liable to the interested parties for damage from failing to.(Art. 74(1), Art. 74(2), Art. 75(1), Art. 75(2), Art. 78(2), Art. 78(3), Art. 78(5), Art. 85(1), Art. 85(2), Art. 156(1), Art. 156(2), Art. 156(5), Art. 84(1)) (the provisions it rests on)
• The trustee can undo (否認) for the estate acts that harmed creditors — among them acts the bankrupt did knowing they would harm creditors, unless the other side did not know; gifts and their equivalents made after the bankrupt stopped paying or was petitioned against, or in the six months before; and security or payment given to a particular creditor for an existing debt after the bankrupt became unable to pay or was petitioned against, where the creditor knew — and, on conditions Article 170 sets, against later acquirers too. It does so by a lawsuit or a request for avoidance (否認の請求) in the bankruptcy court, or by a defence, no later than two years from the opening and ten years from the act. Against the directors and other officers of a corporation in bankruptcy, the court can, on the trustee's application or of its own motion, freeze their property and decide by order how much they owe in damages for their liability.(Art. 160(1), Art. 160(3), Art. 162(1), Art. 170(1), Art. 173(1), Art. 173(2), Art. 176(1), Art. 177(1), Art. 178(1)) (the provisions it rests on)
• Filed claims are examined: the trustee states for each whether it admits its amount and rank, filed creditors may object to them in writing within the examination period or at an examination hearing, and the bankrupt may dispute the amount. A claim the trustee admits and no filed creditor objects to is fixed; the holder of one disputed by the trustee or a creditor can, within a month of the end of the examination period or of the hearing, ask the bankruptcy court to assess it (破産債権査定申立て), and anyone dissatisfied with the assessment can sue against it within a month of being served with it. Where the claim already has an enforceable title or a final judgment, those disputing it must instead challenge it by the procedures open to the bankrupt, and where a lawsuit on it was pending at the opening, the holder must, within the same month, apply to take that suit over against them.(Art. 117(1), Art. 118(1), Art. 118(2), Art. 121(2), Art. 121(4), Art. 124(1), Art. 125(1), Art. 125(2), Art. 126(1), Art. 127(1), Art. 127(2), Art. 129(1)) (the provisions it rests on)
• The proceedings end with an order of completion (破産手続終結) once the final, simplified or consensual distribution is done and the trustee's accounts have been reported. Where the estate cannot cover the costs of the proceedings, the court discontinues them (破産手続廃止) at the same time as opening them, or later on the trustee's application or of its own motion after hearing the creditors, unless enough money is paid in advance; it also discontinues them on the bankrupt's application with the consent of every creditor who filed in time, or with security the court accepts given to those who do not consent, a corporate bankrupt first taking the steps to continue the corporation.(Art. 220(1), Art. 216(1), Art. 216(2), Art. 217(1), Art. 217(3), Art. 218(1), Art. 219(1)) (the provisions it rests on)
• When the proceedings are completed, or discontinued after the opening for lack of funds or with the creditors' consent, the entry for a fixed claim in the table of bankruptcy creditors (破産債権者表) has the effect of a final judgment against the bankrupt, and the creditor can enforce it on that entry, unless the bankrupt disputed the claim during its examination; while an individual's application for a discharge is pending, though, no enforcement on bankruptcy claims can be made against their property, and a final discharge frees them from those claims except the ones Article 253(1) keeps — taxes, damages for a tort committed in bad faith or for injuring someone's life or body intentionally or by gross negligence, family support, employees' claims from the employment, claims knowingly left off the list of creditors (unless the creditor knew of the bankruptcy), and fines. This applies until a day a Cabinet Order sets, no later than 13 June 2028, from which the table is kept as an electronic record (電子破産債権者表).This is the rule until the change takes effect, 13 June 2028 at the latest.(Art. 221(1), Art. 221(2), Art. 249(1), Art. 253(1), Suppl. Prov.(1)) (the provisions it rests on)
• From a day a Cabinet Order sets, no later than 13 June 2028, when the proceedings are completed, or discontinued after the opening for lack of funds or with the creditors' consent, the record for a fixed claim in the electronic table of bankruptcy creditors (電子破産債権者表), which the court clerk keeps in the court's files, has the effect of a final judgment against the bankrupt, and the creditor can enforce it on that record, unless the bankrupt disputed the claim during its examination. While an individual's application for a discharge is pending, though, no enforcement on bankruptcy claims can be made against their property, and a final discharge frees them from those claims except the ones Article 253(1) keeps — taxes, damages for a tort committed in bad faith or for injuring someone's life or body intentionally or by gross negligence, family support, employees' claims from the employment, claims knowingly left off the list of creditors (unless the creditor knew of the bankruptcy), and fines.This is the rule from a day still to be set, 13 June 2028 at the latest.(Art. 221(1), Art. 221(2), Art. 115(1), Art. 115(3), Art. 249(1), Art. 253(1), Suppl. Prov.(1)) (the provisions it rests on)
• Chapter 14 (Articles 265 to 277) makes crimes of acts done to harm creditors, punished once the order opening the proceedings is final: hiding or damaging the debtor's property, faking its transfer or a debt, altering it to reduce its value, or disposing of it or taking on debts to the creditors' disadvantage, with the aim of harming creditors (fraudulent bankruptcy, 詐欺破産罪), carries imprisonment (拘禁刑) of up to 10 years or a fine of up to 10 million yen, or both; the debtor's giving a particular creditor security or payment it did not then owe, or not in that way or at that time, to harm the others, up to 5 years or 5 million yen; and hiding, destroying or forging the books and papers on the debtor's business and property with the aim of harming creditors, up to 3 years or 3 million yen. Refusing to explain or lying when the Act requires an explanation, or in the court's inquiry on one's own bankruptcy petition or discharge application, and refusing to submit the property list or submitting a false one, carry up to 3 years or 3 million yen as well. A conviction for fraudulent bankruptcy lets the court revoke a discharge, and so does a creditor's application within a year where the discharge was obtained dishonestly.(Art. 265(1), Art. 266(1), Art. 270(1), Art. 268(1), Art. 271(1), Art. 269(1), Art. 254(1)) (the provisions it rests on)
• Forcibly demanding a meeting with an individual bankrupt or their relatives or others, or intimidating them, to make them pay a bankruptcy claim — once the discharge proceedings are over, a discharged one — or to guarantee it, carries up to 3 years' imprisonment (拘禁刑) or a fine of up to 3 million yen, or both, and so does obstructing the trustee by deception or force. The fraudulent-bankruptcy penalty also reaches anyone who knowingly takes the other side of a disposal or debt to the creditors' disadvantage, and anyone who, knowing that proceedings have opened or a temporary administrator has been ordered, takes the debtor's property or has another take it, to harm creditors and without the trustee's consent or other good reason. A trustee or temporary administrator who betrays their duty for gain or to harm creditors, causing them loss, faces up to 10 years or 10 million yen; bribery of trustees and of creditors voting at a creditors' meeting is punished as well; a company or person is fined too where its representative or employee commits many of the Chapter's offences in its business; and the offences against creditors, obstructing the trustee and offering bribes are punished even when committed outside Japan.(Art. 275(1), Art. 272(1), Art. 265(1), Art. 265(2), Art. 267(1), Art. 273(1), Art. 273(5), Art. 274(1), Art. 277(1), Art. 276(1), Penal Code Art. 2(1)) (the provisions it rests on)