Bankruptcy Act

A bankruptcy trustee is appointed by the court.

A corporation may serve as a bankruptcy trustee.

The court supervises a bankruptcy trustee.

Upon the petition of an interested person or by its own authority, the court may dismiss a bankruptcy trustee if the bankruptcy trustee does not appropriately administer and dispose of property that belongs to the bankruptcy estate, or if there are any other material reasons to do so. In this case, the court must interrogate the bankruptcy trustee.

If there are two or more bankruptcy trustees, they perform their duties jointly; provided, however, that with permission of the court, they may perform their duties independently or divide the duties among them.

If there are two or more bankruptcy trustees, it is sufficient that a manifestation of intention by a third party be made to any one of them.

A bankruptcy trustee may appoint one or more bankruptcy trustee representatives on their own responsibility, if necessary, in order to have them perform their duties.

The appointment of the bankruptcy trustee representative stated in the preceding paragraph requires the permission of the court.

If an order commencing bankruptcy proceedings is made, the right to administer and dispose of property that belongs to the bankruptcy estate is vested exclusively in a bankruptcy trustee appointed by the court.

Bankruptcy trustees must obtain permission of the court in order to conduct the following acts:

sale by private contract of real estate, Japanese vessels or foreign vessels that must be registered;

sale by private contract of mining rights, fishing rights, rights to operate a public facility, etc., timber rights, rights to operate fishing port surface facilities, storage rights, prospecting rights (meaning prospecting rights prescribed in Article 2, paragraph (8) of the Act on Carbon Dioxide Storage Business (Act No. 38 of 2024)), patent rights, utility model rights, design rights, trademark rights, rights of layout-designs of integrated circuits, breeder's rights, copyrights or neighboring rights;

transfer of operations or business;

package sale of goods;

borrowing of money;

approval of renunciation of inheritance under the provisions of Article 238, paragraph (2), approval of renunciation of a universal legacy under the provisions of Article 243 as applied mutatis mutandis pursuant to Article 238, paragraph (2) or renunciation of a particular legacy pursuant to the provisions of Article 244 paragraph (1);

sale by private contract of movables;

transfer of a claim or securities;

request for performance under the provisions of Article 53, paragraph (1);

filing of an action;

settlement or arbitration agreement (meaning an arbitration agreement prescribed in Article 2, paragraph (1) of the Arbitration Act (Act No. 138 of 2003));

waiver of a right;

approval of a claim on the estate, right of segregation or right of separate satisfaction;

redemption of the collateral for the right of separate satisfaction; and

any other act designated by the court.

Notwithstanding the provisions of the preceding paragraph, in the following cases, the acts listed in item (vii) to item (xiv) of that paragraph do not require permission stated in that paragraph:

if the value of the subject matter of the act in question is not more than the amount specified by the Rules of the Supreme Court; or

beyond the case stated in the preceding item, if the court considers that the permission stated in the preceding paragraph is not required for the act in question.

When granting the permission stated in paragraph (2) for the transfer of an operation or business pursuant to the provisions of paragraph (2), item (iii), the court must hear opinions of the labor union, etc.

Any act conducted without the permission stated in paragraph (2) is void; provided, however, that this may not be asserted against a third party in good faith.

When seeking to conduct any of the acts stated in the items of paragraph (2), a bankruptcy trustee must hear the opinions of the bankrupt, except if the hearing is likely to cause a delay, or in any of the cases stated in the items of paragraph (3).

A bankruptcy trustee must commence the administration of property that belongs to the bankruptcy estate immediately after assuming office.

In an action relating to a bankruptcy estate, a bankruptcy trustee is to stand as a plaintiff or defendant.

The court may commission a person engaged in a delivery service to deliver to a bankruptcy trustee, a postal item or letter item prescribed in Article 2, paragraph (3) of the Act on Correspondence Delivery by Private Business Operators (Act No. 99 of 2002) (referred to as a "postal item, etc." in the following Article and Article 118, paragraph (5)) that is addressed to the bankrupt when it finds it necessary to do so for a bankruptcy trustee to perform their duties.

The court may cancel or change the commission prescribed in the preceding paragraph after hearing opinions of a bankruptcy trustee upon the petition of the bankrupt or by its own authority.

Upon the closing of bankruptcy proceedings, the court must cancel the commission prescribed in paragraph (1).

The bankrupt or a bankruptcy trustee may file an immediate appeal against an order made under the provisions of paragraph (1) or paragraph (2) and a judicial decision to dismiss without prejudice the petition stated in paragraph (2).

The immediate appeal stated in the preceding paragraph filed against an order made under the provisions of paragraph (1) does not have the effect of stay of enforcement.

Upon receiving a postal item, etc. addressed to the bankrupt, a bankruptcy trustee may open the item and view its content.

The bankrupt may request a bankruptcy trustee to let the bankrupt inspect the postal item, etc. stated in the preceding paragraph received by the bankruptcy trustee, or deliver it to the bankrupt, if the postal item, etc. does not relate to the bankruptcy estate.

A bankruptcy trustee may request any of the persons stated in the items of Article 40, paragraph (1) and any of the persons prescribed in paragraph (2) of that Article to give an explanation pursuant to the provisions of that Article, or may inspect books, documents, and any other objects relating to the bankruptcy estate.

A bankruptcy trustee may request a subsidiary company, etc. (meaning a corporation specified in each of the following items for the category stated in the respective items; the same applies in the following paragraph) of the bankrupt to give an explanation on the status of their business and property, or may inspect their books, documents, and any other materials if it is necessary to do so in order to perform their duties:

if the bankrupt is a stock company:a subsidiary company (meaning a subsidiary company prescribed in Article 2, item (iii) of the Companies Act) of the bankrupt;

if the bankrupt is a person other than a stock company:a stock company in which the bankrupt holds the majority of voting rights held by all shareholders; and

If a subsidiary company, etc. of the bankrupt (limited to a person other than a stock company; the same applies below in this paragraph) independently holds or the bankrupt and the bankrupt's subsidiary company, etc. jointly hold the majority of voting rights held by all shareholders of another stock company, for the purpose of application of the provisions of the preceding paragraph, the other stock company is deemed to be a subsidiary company of the bankrupt.

When facing resistance in the process of performing their duties, a bankruptcy trustee may request for police assistance in order to eliminate the resistance with permission of the court.

A bankruptcy trustee must perform their duties with the due care of a prudent manager.

If a bankruptcy trustee fails to take the due care stated in the preceding paragraph, the bankruptcy trustee is jointly and severally liable to compensate damage to any interested person.