The Civil Code is set to undergo the first major revisions since it was enacted in 1896 in areas related to business activities and people’s daily lives. It is inevitable that the interests of various parties, including businesses and consumers, will clash in amending the code, but the Justice Ministry should uphold the principle of protecting the interests of consumers as the bottom line.

One of the aims of the revisions is to make the law easier to understand for ordinary citizens. The Justice Ministry presented a revision draft to the Civil Code section of the Legislative Council, an advisory body for the justice minister, in late August. After receiving a report from the section, the ministry will draft legislation to amend the code and submit it to the Diet next year.

Compared with the civil codes of Western countries, Japan’s civil code has much fewer clauses because it has omitted widely accepted principles. This has enabled flexible interpretations, and Japan has coped with various problems by resorting to legal precedents set by courts.

Given the complexities in today’s society, however, this approach is nearing the limit, and the ministry has been working on drafting the amendments for the past five years.

One proposed revision is to introduce rules to govern terms and conditions unilaterally set by companies in such business transactions as insurance policy sales, mobile phone use and the supply of electricity and gas. Most people sign contracts without carefully reading the terms and conditions, which usually are in small print. There are many cases in which mobile phone users don’t know that they have to pay a cancelation fee if they end the contract halfway through the contract period until the providers charge them such fees.

The revision draft calls for the insertion of a clause that nullifies terms and conditions that unilaterally harm the interests of consumers. However, the provision is still being debated because the business sector has raised objections.

Another new rule concerns the security deposit that tenants pay when moving into rental housing. Under prevailing business practices in many areas, expenses that landlords pay to clean and repair the housing upon tenants’ departures are subtracted from the security deposits before they’re refunded. The revision draft inserts a qualification clause: Tenants have no duty to pay for “damage” that is the result of normal wear and tear. So unless the rental housing requires repair beyond the effects of normal wear and tear, tenants should get back their entire deposits.

Currently the period of time in which the claim for financial liabilities is legally valid — involving such cases as fees for lawyers and doctors or payments to drinking places — varies from industry to industry. Under the draft, the duration will be set at uniform five years after one has realized that one can ask another party for payment.

In the area of economic activities, a special measure will be taken concerning credit that currently cannot be transferred. Such credit will become transferable, which will be helpful for small companies facing cash-flow problems.

Also in view of the rapid aging of Japan’s population, the Justice Ministry plans to introduce a clause that makes a contract signed by a person with impaired mental capacity, including people with senile dementia, invalid.

It is hoped that the planned revisions will be the first effective step toward making the Civil Code up to date and will help ensure smoother relationships between consumers and businesses. As the next step, the Justice Ministry should make proposals to revise the code in the areas of family relations and inheritance that take into consideration situations that are becoming more commonplace in today’s society.

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