It's no secret that running an election campaign costs a lot of money, which is why many countries regulate candidates' fundraising activities and subsequent use of those funds. In Japan, politicians have to pay a deposit to the relevant authorities just to register their candidacy. And while other countries do the same, Japan demands the highest deposits anywhere, at least for national assembly seats.

Candidates for constituent seats in today's House of Councilors election had to put down ¥3 million, while those running for proportional seats needed ¥6 million, since they are basically running a nationwide campaign. Those in South Korea, the second most expensive country in terms of candidate deposits, only pay the equivalent of ¥1.35 million. In the U.K., it's about ¥77,000. Americans don't have to pay anything.

Moreover, if the candidate does not achieve a minimum percentage of the poll — at least 10 percent in the case of the Upper House — he or she loses the deposit. The purpose of the deposit is to limit candidates to those who are supposedly serious about running, though, obviously, it favors the financially solvent and those backed by established political parties.

In fact, some have said that the deposit system is the main reason the same people tend to get elected over and over again. It was introduced in 1925 when suffrage was expanded to include men (still no women) who did not pay taxes. The authorities were afraid that just anyone would try to run for office, and so they set up the deposit system to limit candidates to men of means. Much of the deposit is used to help local election authorities pay for the cost of running a poll.

But even beyond the deposit, campaigns themselves can be prohibitively expensive. According to The Huffington Post Japan, candidates for the Upper House election in 2012 spent ¥66.6 billion. Certain "public expenses" (kōhi) will be reimbursed by the state, but, again, only if the candidate secures a minimum portion of the votes in their contest.

Anyone who reads the news regularly sees stories of candidates being investigated or punished for violating campaign rules, which is relatively easy to do considering how complicated the regulations are regarding what a candidate can spend.

Take the printing and distribution of campaign materials. In the 2012 election, according to the investment website Setsuyaku Toshin no Susume, the government covered full postage and printing costs of up to ¥7.5 per card for the first 35,000 hōtei hagaki (legal postcards), after which the candidate paid. Flyers are even more of a pain in the neck. The limit paid for by the government was 70,000 flyers or ¥462,700, which comes to ¥6.61 per flyer. The problem is that in order to confirm that the flyers have been cleared for distribution, the candidate must affix a government-approved sticker to each one, an extremely time-consuming process.

Poster boards are also controlled. The government paid up to ¥1,115 per board in 2012 for a maximum of 500 boards. They paid up to ¥202,192 for speaker truck signs and up to ¥193,105 for signs to adorn "campaign performance spaces," like train stations and parks. As for the sound trucks themselves, candidates can either hire a company that provides a vehicle and covers all the expenses or rent a truck and then pay for their own gasoline and human resources. The state paid up to ¥774,000 for a hire, and up to ¥421,800 for a rental. Expenses for gasoline and other related necessities are covered under a different category.

In principle, candidates are not allowed to pay staff. With some exceptions, they must all be volunteers. An "office clerk" can be hired "to answer phones," but can only be paid a maximum of ¥10,000 a day, and laborers "who have no contact with voters" can receive ¥10,000 a day "to put up posters." In fact, ¥10,000 seems to be the operative fee. Sound truck drivers get paid that amount, even if they work the legal limit of a 12-hour campaign day (8 a.m. to 8 p.m.). The women in the trucks who call out the candidate's name ad nauseam, called uguisu-jo (nightingale women), may be able to demand a little bit more. Their fee is decided by local governments. Hyogo Prefecture allowed for up to ¥15,000 a day in 2012. None of these fees were paid by the government. They came out of the candidates' own funds. The same goes for sign language interpreters.

However, staff can receive boxed lunches and money for transportation and accommodations, which are also limited by region and type of election. For instance, the size of the constituency determines the limit for transportation expenses — usually in the form of train passes paid for by government — and politicians running for proportional seats can be reimbursed for shinkansen and other train fares since they may have to travel all over.

The only two things that are always paid directly by the state, meaning candidates don't have to shell out money beforehand, are broadcasts of candidates' statements on NHK, and up to five newspaper advertisements.

With so many outside contractors involved, the system is ripe for abuse. In February, Sankei Shimbun reported on a candidate for last summer's municipal assembly election in Kashiwa, Chiba Prefecture. It was bad enough that Masataka Konno lost his bid for a seat, but he might also eventually be investigated for fraud in connection with a printing company.

Before the election, Konno had asked the printer for an estimate to make campaign posters. Originally they quoted a figure of ¥158,760, but they later charged ¥680,400. Despite the fourfold increase, Konno signed the job order before submitting it to local election authorities, which later transferred ¥558,360 in funds — the maximum allowed for posters — to the printer, who waived the balance because, as Konno told Sankei, they felt bad about the low estimate.

Nevertheless, Konno suspects the printer padded the invoice — a common practice, it seems, because in many instances candidates are not reimbursed for such expenses; they simply pass the bill on to the authorities, who don't check it. Last February, he filed a criminal complaint against the printer for fraud, an act that, as the Sankei points out, could implicate him as well, since he signed the purchase contract. In his defense, Konno said he didn't think the amount was wrong at the time because he was told that other candidates were spending that much on posters. The Sankei article gives the impression that everyone pads their invoices — and that everyone knows that everyone pads their invoices.

In that regard, this particular election may have been more profitable than others. Legally, the campaign period for an Upper House election is 17 days, but because June 23, the legal campaign starting date for the July 10 election, was Okinawan Memorial Day, the government decided to open the campaign a day earlier, on June 22, which means one more day to spend money on whatever it is candidates are allowed to spend money on.

Yen for Living covers issues related to making, spending and saving money in Japan on the second and fourth Sundays of the month. For related online content, see blog.japantimes.co.jp/yen-for-living.