AirBnB in Japan

AirbnB in Japan Close to Full Legalization: Details of Draft Law

By Jeff Wynkoop

The Japanese cabinet has just cleared the way for full legalization of Airbnb-style (minpaku, 民泊) private-stay accomodations in Japan.

Implementation in 2018

On March 10th, the Japanese Cabinet agreed to the contents of the draft law to be submitted to the Diet to legalize minpaku (Airbnb-style) private stay accommodations for all of Japan. The government plans to have the draft law passed in this year’s regular Diet session, with implementation in 2018.

With this step, the government is giving efforts to support the recent tourist boom and make progress in attaining its stated target of reaching 40 million visitors to Japan per year by 2020.

Current Status of Airbnb

Currently minpaku in Japan are only allowed in Osaka and in Ota-ku in Tokyo, or by special permission to operate as a ‘simple accommodation’ (簡易宿所) under the  Hotel Business Law. However, the ‘simple accommodation’ conditions of the Hotel Business Law are rather strict, and this has spawned many illegal minpaku operations around the country, with several thriving online websites dealing in short-term accommodations. A recent search of Airbnb Japan found over 48,000 listed properties.

One of the main purposes of the draft law is to give the Diet a way to authorize these existing illegal businesses.

Operation Up to 180 Days a Year with Notification

Under the proposed law contents, Airbnb-style accommodations may be operated for up to 180 days a year by submitting a notification to the municipal government.

However, critics complain that with the 180-day restriction, the government is trying to make it difficult to run a minpaku property as a non-resident, rental business.

Nevertheless, once the law is passed, generally any citizen will be allowed to operate a minpaku, and for the first time minpaku will be authorized in residential districts(住宅地域) where ‘simple accommodations’ under the Hotel Business Law are not allowed. Despite this opening up of the minpaku market, the government still has a long way to go to attain its 40 million tourists per year goal. Last year, the total number of visitors exceeded the 20 million mark for only the first time in history.

Local Authorities Can Limit

According to the draft law, local municipalities will be authorized to lower the 180 day a year limit, but only ‘as necessary to prevent deterioration of the living environment through noise etc.’ (騒音など生活環境の悪化を防止する目的に限り), and local municipalities may not ban minpaku outright.

Minpaku operators will be obliged to manage the property to take care of noise complaints from neighbors, as well as display a minpaku shield and obey certain public health laws.

Other Regulations

Websites such as Airbnb will be allowed to register as online minpaku dealers, but will need to display room fees and agent charges. Websites which violate the law will lose their registrations. In addition, minpaku businesses will be subject to inspection, and businesses unlicensed under the Hotel Business law which do not submit a minpaku notification can be fined by up to a maximum of 1 million JPY per incident, up from the current 30,000JPY.