Amendment of Japan’s Real Property Registration Act
To make inheritance registration of land ownership and change of owner address become mandatory in Japan
Registration of inheritance and change of address of real estate ownership will be mandatory (to be enforced by 2024). After the amendment is in effect, failure to do such duties without good reason will be subject to an administrative penalty.
As a result of the fact that the owner of the land has moved without notifying contact information or multiple inheritors make it difficult to contact because inheritance registration was not filed after the owner of the land deceased, so-called “Lands of Unknown Ownership” have been increasing nationwide in Japan. The area of such lands currently exceeds the land area of Kyushu, and it seems that it may reach up to the land area of Hokkaido.
To solve such problem the amendment to the Civil Code of Japan will be carried out.
Problems with land of unknown ownership in Japan
If the seller’s name cannot be confirmed on the registry upon a buying and selling transaction of a land, prospective buyers will not be able to purchase the land with confidence, making it difficult to conclude the transaction.
In the case that the name of a landowner cannot be confirmed on the registry when receiving a loan from a financial institution, the land may not be able to use as a mortgage property.
When the national or local government wants to acquire a land for public use or disaster countermeasures, it will take a lot of time and money to find the owner of the land.
Major Amendments of Japan’s Real Property Registration Act
1. Application for inheritance registration to be mandated (Effective April 1, 2024)
A person who acquires a land by inheritance due to the death of the registered holder of the land must register change of the holder of the land within 3 years from the date of the start of inheritance or the date of knowing that he/she has acquired such ownership. Failure to do so will result in a fine of up to 100,000 yen.
* For the land that you have not yet completed inheritance registration before the amendment of the Act, in principle, it is necessary for you to complete inheritance registration within 3 years from the date of enforcement of the Act. However, when you have known that you are inheriting a land after the amendment of the Act, you will be obligated to complete inheritance registration within 3 years from the date when you have known your inheritance.
* This also applies to the case when you acquire land by testamentary bequest.
2. Establishment of a new system to file a declaration of inheritance (Effective April 1, 2024)
When a legacy division conference is not settled, and you notify the registry officer that “an inheritance procedure has started” and “you are an heir”, you can fulfill your obligation to apply for inheritance registration, etc. If you do not apply for inheritance registration without good reason, you shall be subject to an administrative fine of not more than 50,000 yen.
Provided, however, that the procedure aforesaid does not mean that the right of inheritance has been changed to the heirs. So, after the legacy division conference is settled, registration of change of the owner’s name must be completed within 3 years from the date of settlement of the legacy division conference.
3. Notification of change of the owner’s name, address, etc. to be mandated (Effective by April, 2026)
When the registered holder of real estate ownership changes his/her address, etc., he/she must apply for such change within 2 years from the date of the change.
Failure to do so without good reason will result in an administrative penalty.
In line with such mandatory system, a new system, that the registrar makes an executive decision to register such changes based on information obtained from other public authorities, will be introduced.
■ How the new system works? ■
In the case of an Individual (only when requested by the registered holder)
The registered holder provides the registrar with “searched information” such as name, address, and date of birth.
The registrar queries the Basic Resident Register Network System by using such “searched information” to obtain information on change of such as the name and address of the registered holder of ownership.
Based on the information obtained, the registrar will confirm with the registered holder whether to register the change of address, etc., and if approved, the registrar will register the change (Exempted from Tax).
In the case of a corporation (it is subject to the registrar’s ex officio registration of change regardless of whether or not requested by a corporation)
For real estate which a corporation is the registered holder of ownership, the corporation number shall be added to the registered information (With this amendment of the Act, the corporation number shall be included in the registered information).
The commercial and corporate registration system of Ministry of Justice and Legal Affairs Bureau is linked up with the real estate registration system.
Based on the information obtained within Ministry of Justice, the registrar registers the changes (Exempted from Tax).
4. To create the law that can transfer unwanted land to the government of Japan (Effective April 1, 2023)
When a land is not necessary for an heir or a devisee and the heir or the devisee meet certain conditions, such unnecessary land will be taken over by the country. Certain conditions include, that large amount of cost for management and disposal is not expected, that there is no building structure in the land, and that there is no trouble with the neighboring landowner. In addition, a paid examination is required to request for transferring such a land and payment of land management costs for 10 years is required as well.
Reference case: Management fee (for 10 years)
Uncultivated field: 200,000JPY
Residential land in urban area (200m2): Approx.800,000JPY
Requirements: (do not fall under the following types of land, which require significant costs and efforts for management or disposal in a normal manner)
Land with buildings or workpieces that disturb normal management or disposal.
Land with soil contamination or buried objects
Land with cliffs
Land with ownership disputes
Land which is collateralized against the mortgage loan, etc.
Land which is used by others, such as a passage, etc.
5. Review of rules for cutting branches of cross-border bamboo and trees (effective April 1, 2023)
The current Civil Code stipulates for cross-border bamboo and trees from the neighboring land as follows:
Roots: Can be cut on the crossed side of land
Branches: You need to request the owner of the bamboo or tree for cutting the branches
According to the current rule, every time branches grow and cross the border, you have to sue and obtain a judgement to cut the branches, which is very inconvenient. Therefore, due to the revision this time, you will be able to cut the cross-border branches if any of the following applies.
When you ask the owner of the bamboo or tree to remove the cross-border branches, but the owner does not remove them after a considerable period of time
When you don’t know who or where the owner is
When you are in hurry
The above is just a part of the amendments this time and there are several other amendments. Please note that laws which have time to become effective may be subject to minor revisions in actual operation.