AirBnB in Japan

Japan Releases Details of New Law on AirBnB-Style Rentals

By Jeff Wynkoop

The Japanese government has finally released details of the new Minpaku (民泊) Law it plans to submit to the regular session of the Diet sometime in 2017. The main purpose of the law is to provide a legal basis for the Airbnb-style private room renting that has been popping up all over Japan the last few years.

Please see the most up-to-date status of Airbnb in Japan here:

Japan Legalizes Airbnb in Japan: Diet Passes Law (June 9, 2017)

Airbnb in Japan close to full legalization: Details of draft law (March 11, 2017)

Current Legal Status of AirBnB-Style Rentals

Currently Airbnb-style businesses are illegal since renting out a room to the general public in a continuous fashion is considered to be a breach of the Japanese Hotel Business Law (ryokangyouhou or “Hotel Law”). That is, the Ministry of Health, Labor, and Welfare, the Japanese ministry which enforces the Hotel Law, requires such business to get a license prior to beginning operations, however Hotel Law regulations are very strict and often times impractical to satisfy for private citizens wanting to rent out a room.

In the alternative, it is possible for Airbnb-style operations to be set up legally in one of the special economic zones designated around the country, provided the economic zone has also already passed a special Minpaku enforcement ordinance (such as in Osaka City and in Ota-ku in Tokyo), but these ordinances require guests to stay a minimum of 7 nights.

For changes to the law since this article was posted, please see: Government to Lower Restrictions on AirBnB-Style Rentals in Japan, posted on August 8, 2016.

Real Estate Zoning Law Restrictions

To loosen the Hotel Law restrictions, the Ministry of Health, Labor, and Welfare has already enacted amendments this year to make it easier for small operators to qualify for a license (and be allowed to have guests stay less than 7 nights), but the main hurdle for private citizens is that there are real estate zoning law restrictions to such licenses (i.e., they may not be issued to operators located in private residential zones, only to operators in areas zoned for business).

New Law Will Require Outside Management of AirBnB-Style Operations

The main thrust of the new law is to require Airbnb-style operators have a contract with an outside management company which is a registered Minpaku business.

The “management company” under the new law is intended to refer to licensed real estate business operators and/or licensed hotel businesses which regularly provide leasing and/or real estate administrative services to private citizens and other companies dealing with the general public.

Such management companies will be obliged under the new law to perform background checks of guests, take care of complaints from neighbors, manage keys for the operator, take out casualty insurance, make sure building garbage rules are complied with, etc.

Under the new law, operators will be allowed to have guests stay for even just one night, and there are no zoning law restrictions. Accordingly, the government expects the new law will further stimulate regular citizens entering into agreements with private real estate management firms.

By: Jeff Wynkoop

Source: Nikkei Shinbun, March 15, 2016

Top photo: House in Osaka

For changes to the law since this article was posted, please see: Government to Lower Restrictions on AirBnB-Style Rentals in Japan, posted on August 8, 2016.

You may also be interested in: National Framework for AirBnB-Style Rentals Coming to Japan and Osaka Enacts Ordinance to Open Up AirBnB-Style Rentals