National Tax Collection Act

The district director may, with regard to a person for whom there is a fact found to show that the person falls under any of the following, for two years after the fact occurred, restrict that person from entering the place of the public auction, expel that person from that place, or not allow that person to make a bid, etc. The same applies to a person who employs, as an employee or other worker, a person for whom two years have not elapsed since the fact occurred, and to a person who makes such a person an agent for a bid, etc.

A person who obstructed the participation in a public auction or the bid, etc. of a person who intends to make a bid, etc., the determination of the highest bidder, etc., or the payment of the purchase price by the purchaser;

A person who conspired for the purpose of unjustly lowering the price at a public auction.

A person who made an application to purchase under a false name;

A purchaser who, without a justifiable reason, does not pay the purchase price by the payment deadline for payment of the purchase price;

A person who intentionally damaged public auction property and reduced its value;

In addition to the persons listed in the preceding items, a person who committed an act obstructing the conduct of a public auction or a sale by private contract.

With regard to a bid, etc. by a person who falls under the preceding paragraph or a decision determining that person as the highest bidder, etc., the district director may treat the bid, etc. as not having been made or revoke the decision.

In the case referred to in the preceding paragraph, if there is a public auction deposit paid by the person subject to the disposition under that paragraph, that public auction deposit reverts to the national treasury. In this case, Article 100, paragraph (6) (Public Auction Deposit) does not apply.

When the district director finds it necessary for the application of paragraph (1), the district director may require proof of the status of a bidder, etc.

Where the district director finds that the highest bidder, etc. for real property for public auction, or a person who has had the highest bidder, etc. make a bid, etc. for the real property for public auction on their own account, falls under either of the following, the district director may revoke the decision determining those persons as the highest bidder, etc.

An organized crime group member, etc. (including a person who was an organized crime group member, etc. at the time the bid, etc. for the real property for public auction was made);

A corporation that has among its officers a person who falls under organized crime group member, etc. (including one that had among its officers a person who fell under organized crime group member, etc. at the time the bid, etc. for the real property for public auction was made).

In any of the following cases, the district director may sell seized property, etc. by private contract in lieu of public auction.

Where, under the provisions of laws and regulations, there is only one person who can purchase the public auction property, where the highest price of the property has been fixed and it is sold at that price, or where it is otherwise found inappropriate in the public interest to put it up for public auction;

Where property for which there is an exchange quotation is sold at the quotation of that day;

Where, even though the property was put up for public auction, there is no bid, etc., where the price of the bids, etc. does not reach the estimated value, or where the decision to sell has been revoked under Article 115, paragraph (4) (Payment Deadline for the Purchase Price, etc.).

Article 98 (Determination of the Estimated Value) applies mutatis mutandis to a sale under paragraph (1), item (i) or (iii). In this case, when selling under item (iii) of that paragraph, the estimated value must not be lower than the estimated value at the immediately preceding public auction.

When the seized property, etc. to be sold under paragraph (1), item (iii) is movable property, the district director may sell it at a price publicly noticed in advance.

The provisions of Article 96 (Notice of Public Auction), Article 99-2 (Statement Indicating That the Relevant Person Is Not a Current or Former Member of an Organized Crime Group), Article 106-2 (Commission of Examinations) and Article 107, paragraph (3) (Second Public Auction) apply mutatis mutandis to the case of selling seized property, etc. by private contract, and the provisions of Article 106, paragraphs (2) and (3) (Announcement of the Close of Bidding or Auction by Competitive Bidding, etc.) apply mutatis mutandis to the case where the person to become the purchaser by private contract has been determined. In this case, the phrase "When the district director has given the public notice under the preceding Article" in Article 96, paragraph (1) is deemed to be replaced with "No later than seven days before the day of sale by private contract", and the term "notify" in that paragraph with "send a written notice to"; the phrase "who intends to make a bid, etc. for public auction property" in Article 99-2 with "who intends to purchase public auction property by private contract", and the phrase "may not make a bid, etc." in that Article with "may not purchase"; the phrase "who intends to make a bid, etc. for the real property for public auction" in item (i) of that Article with "who intends to purchase the real property for public auction by private contract"; the phrase "intends to have a bid, etc. made for the real property for public auction" in item (ii) of that Article with "intends to have the real property for public auction purchased by private contract"; and the phrase "who has had the highest bidder, etc. make a bid, etc. for the real property for public auction on that person's own account" in Article 106-2, paragraph (2) with "who has intended to have the highest bidder, etc. purchase the real property for public auction by private contract on that person's own account".

Where a case falls under paragraph (1), item (iii) of the preceding Article, the State may, if necessary, purchase the property at the estimated value under paragraph (2) of that Article.

When putting movables, securities or telephone subscription rights up for realization, the district director makes a decision to sell to the highest bidder (including, in the case of a sale by private contract, the person to become the purchaser; the same applies hereinafter) on the day of the public auction (or, in the case of a sale by private contract, the day of the sale; hereinafter referred to as the "public auction date, etc.").

The revocation of a decision to sell relating to movables or securities that have been realized cannot be asserted against a purchaser in good faith who has paid the purchase price.

Where there is a person who has suffered damage because the revocation cannot be asserted against the purchaser under the preceding paragraph, the State is liable to compensate the amount of loss that would ordinarily arise, except where that person was intentional or negligent as to the occurrence of the damage. In this case, if there is another person liable for the cause of the damage, this does not preclude the exercise of the right of reimbursement against that person.

When putting real property, etc. up for realization, the district director makes a decision to sell to the highest bidder on the day on which seven days have elapsed counting from the public auction date, etc. (when putting real property up for realization, the day specified by Ministry of Finance Order taking into account the number of days ordinarily required for the investigation under Article 106-2 (Commission of Examinations) (including as applied mutatis mutandis pursuant to Article 109, paragraph (4) (Sale by Private Contract)); hereinafter referred to as the "date of decision to sell").

Where a next highest bidder has been determined, if any of the cases set out in the following items applies, the district director makes a decision to sell to the next highest bidder on the day specified in the relevant item.

in the case where the district director has revoked the decision concerning the highest bidder pursuant to the provisions of Article 108, paragraph (2) or (5) (Measures to Ensure Proper Conduct of Public Auctions): the date of decision to sell relating to that highest bidder;

in the case where the highest bidder has cancelled the bid pursuant to the provisions of the following Article: the date of decision to sell relating to that bid;

in the case where a purchaser who is the highest bidder has cancelled the purchase pursuant to the provisions of the following Article: the day on which the purchaser cancelled it;

in the case where the district director has revoked the decision to sell relating to a purchaser who is the highest bidder pursuant to the provisions of Article 115, paragraph (4) (Payment Deadline for Payment of the Purchase Price, etc.): the day on which the director revoked it.

Where a decision on the highest bidder, etc. or a decision to sell has been made with respect to property that has been put up for realization (hereinafter referred to as "property put up for realization"), and a stay of the continuation of delinquent tax collection procedures has been ordered under the proviso to Article 105, paragraph (1) of the Act on General Rules for National Taxes (Restriction on Dispositions Where an Appeal Has Been Filed) or any other provision of an Act, the highest bidder, etc. or the purchaser may cancel the bid, etc. or the purchase while the stay continues.

The payment deadline for the payment of the purchase price of property put up for realization is the date of the decision to sell (or, where the purchaser is the next highest bidder, the day on which seven days have elapsed counting from that date).

The district director may extend the deadline under the preceding paragraph if the director finds it necessary; however, the period must not exceed 30 days.

The purchaser must pay the purchase price in cash by the deadline under paragraph (1).

If the purchaser does not pay the purchase price by the deadline under paragraph (1), the district director may revoke the decision to sell.

The purchaser acquires the property put up for realization at the time the purchaser pays the purchase price.

When a collection official has received the purchase price, the national tax relating to the realization is deemed to have been collected from the delinquent taxpayer to the extent of the amount received.

The district director must revoke the decision to sell if the fact of full payment of the national tax relating to the property put up for realization (in the case of realizing specified real property under participatory seizure, the national tax relating to the specified participatory seizure, or the national tax, local tax or public charge relating to the seizure by delinquent tax collection procedure of an administrative agency, etc. consenting to realization) is proved before the purchaser's payment of the purchase price.

When the purchaser of property put up for realization (excluding securities) has paid the purchase price, the district director must deliver the written notice of the decision to sell to the purchaser; however, the director may refrain from delivering it for movables.

When the purchaser of realized movables, securities, or motor vehicles, construction machinery or small vessels (limited to those that a collection official has taken into possession) has paid the purchase price, the district director must deliver the property to the purchaser.

In the case referred to in the preceding paragraph, if the property is being kept by the delinquent taxpayer or a third party, the district director may deliver the property by delivering the written notice of the decision to sell to the purchaser. In this case, the district director who has delivered the property must notify the delinquent taxpayer or the third party to that effect.

When delivering realized securities to the purchaser, if it is necessary to have the delinquent taxpayer carry out procedures for indorsement, change of name or restoration of negotiability with respect to the transfer of the rights relating to the securities, the district director must specify a time limit and have the delinquent taxpayer carry out those procedures.

In the case referred to in the preceding paragraph, if the delinquent taxpayer does not carry out the procedures referred to in that paragraph by that time limit, the district director may carry out the procedures on behalf of the delinquent taxpayer.

With respect to property put up for realization for which registration is required for the transfer of rights, except where otherwise provided for in the Real Property Registration Act (Act No. 123 of 2004) or other laws and regulations, the district director must, at the request of the purchaser who has paid the purchase price, commission the relevant authority to register the transfer of the rights.

When the purchaser of a realized claim or of property prescribed in Article 73, paragraph (1) (Procedures for Seizure of Telephone Subscription Rights, etc.) or Article 73-2, paragraph (1) (Procedures for Seizure of Book-Entry Corporate Bonds, etc.) has paid the purchase price, the district director must deliver the written notice of the decision to sell to the third-party debtor, etc.

In the case referred to in the preceding paragraph, if there is a document that has been taken up pursuant to the provisions of Article 65 (Taking Up of Instruments Evidencing a Claim) (including as applied mutatis mutandis pursuant to Article 73, paragraph (5) (Taking Up of Certificates of Rights)), the document must be delivered to the purchaser.