Note: This article covers Japan's Act on Specified Commercial Transactions labeling requirements, which are specific to businesses selling to consumers in Japan under Japanese law. The information below will not be directly relevant if you are not selling in the Japanese market.
If you're running an e-commerce site on Shopify targeting the domestic Japanese market, a page for the "Act on Specified Commercial Transactions notice" is essential.
The Act on Specified Commercial Transactions is a law that requires businesses to disclose information such as sales terms and contact details, so that consumers can use online shops with peace of mind. Since e-commerce sites fall under "mail-order sales," they are subject to regulation under this law.
However, when it comes time to actually create this notice page, many people are unsure what items to include and where to configure it in Shopify.
In this article, supervised by Attorney Kosuke Sato, we cover the basics of the Act on Specified Commercial Transactions, the setup steps in the Shopify admin, and how to think through each required item, in a clear and easy-to-understand way.
What Is the Act on Specified Commercial Transactions? Basics Every E-commerce Operator Should Know
First, let's make sure we properly understand the Act on Specified Commercial Transactions.
The Purpose of the Act and Its Application to "Mail-Order Sales"
The Act on Specified Commercial Transactions was enacted to protect consumers from transactions prone to consumer disputes. It sets out detailed rules that businesses must follow, as well as rules to protect consumers (such as the cooling-off system).
The transactions covered are wide-ranging, and mainly include the following.
- Door-to-door sales
- Telemarketing sales
- Mail-order sales
- Multi-level marketing (chain sales)
Sales through e-commerce sites, including Shopify, fall under "mail-order sales." As long as you operate an e-commerce site, you need to recognize this as a "legal obligation" that cannot be avoided.
The Definition of "Advertising" in E-commerce and the Disclosure Obligation
Businesses conducting mail-order sales have an "advertising disclosure obligation" to accurately display the selling price and business information.
Here, "advertising" doesn't refer only to TV commercials or banner ads. The product detail page, order page, and any screen where consumers can consider or complete a purchase application are themselves considered "advertising."
In other words, simply by operating an e-commerce site, you become subject to the "advertising disclosure obligation" (the obligation to display required information in advertising). It's common practice to create a dedicated page on the site called "Act on Specified Commercial Transactions notice" that consolidates and publishes the required items.
Points to Note on Return Terms and Cooling-Off
Another important point concerns return rules. In fact, the legal "cooling-off system" does not apply to mail-order sales. However, there are conditions to this.
- Principle: If the site clearly states "whether returns are accepted and under what conditions (return terms)," those stated conditions take precedence.
- Exception: If return terms are not displayed, the consumer may cancel the contract (return the product) at their own shipping cost, within 8 days of receiving the product.
To prevent unintended return disputes and ensure sound operations, we recommend clearly stating your return conditions.
Penalties and Sanctions for Violations
Violating the Act on Specified Commercial Transactions can result in administrative sanctions such as business improvement orders or business suspension orders.
Furthermore, failing to comply with these orders can also lead to criminal penalties. For example, violating a business suspension order may result in imprisonment for up to 3 years, a fine of up to 3 million yen, or both.
Failing to fulfill the advertising disclosure obligation can subject you to administrative sanctions, so make sure to prepare properly before launching your store.
Required Disclosure Items and Key Points for Writing Them
Here we organize the main items required to be displayed in mail-order sales advertising, along with key points to keep in mind for each. The items that must be disclosed are as follows.
- Name of the business operator
- Address
- Phone number
- Email address
- Selling price of products
- Costs other than the product price
- Payment method
- Payment timing
- Timing of product delivery
- Conditions for returns, exchanges, and cancellations
Name of the Business Operator
For the seller's name, corporations should list the official name as registered in the commercial register, and sole proprietors should list their legal name as on their family register. A trade name or brand name alone is not sufficient.
Also, when a corporation advertises online, the name of the representative or the person responsible for mail-order operations must also be displayed.
Address
The address must accurately state the actual location of operations down to the street address. How to handle cases using a virtual office address is discussed later, in "How to Handle Cases Where You Want to Keep Your Address and Phone Number Private."
Phone Number
List a phone number that can actually respond to consumer inquiries. Note that having only a contact form may not satisfy this requirement.
Email Address
If you distribute commercial advertising by email (mail-order email advertising) such as newsletters, you are required to display an email address. If you use Shopify to send promotional emails such as campaign announcements to customers, be sure to include this.
Selling Price of Products
Product selling prices should basically be displayed as the actual price including consumption tax. If you have too many products to list them all, it's acceptable to note "listed on each product page."
Costs Other Than the Product Price (Shipping, Fees, etc.)
Costs the consumer bears beyond the product price (shipping, cash-on-delivery fees, transfer fees, etc.) must also be clearly stated. It's helpful to specify shipping rates by region or conditions such as "free shipping on orders over ¥◯◯."
If shipping details are consolidated on a shipping policy page, it's fine to note "listed in the shipping policy." In that case, however, be sure to include a link that takes consumers directly to the shipping policy page — not just a text reference — so they can easily check it.
Payment Method
List all available payment methods. It is not acceptable to list only some methods and omit others.
Payment Timing
Clearly state the payment timing for each method — for example, "at the time of order" for credit cards, or "upon receipt of the product" for cash on delivery.
Timing of Product Delivery
State the approximate time from order to delivery. Common phrasing includes "shipped within ◯ business days of order" or "delivered on your requested date."
For pre-order or made-to-order items that take longer than usual, note this as well to help prevent disputes.
Conditions for Returns, Exchanges, and Cancellations
Specify concretely whether you accept returns or exchanges and under what conditions. This is one of the points consumers care about most, and one that can easily lead to disputes.
Key points to consider when drafting this section include the following.
- Whether you accept returns for the customer's convenience
- How you handle defective items or shipping errors (exchange or refund)
- The deadline for returns (e.g., within ◯ days of arrival)
- Who bears the shipping cost for returns (the customer or the business)
As mentioned earlier, if return terms are not displayed in your advertising, the law requires you to accept returns within 8 days of receipt. It's important to clearly define your own policy and state it accordingly.
You should also state your policy for cases where the delivered product differs from what was ordered, or has a quality issue (non-conformity with the contract), if you have a special agreement in place. For example: "In the case of a defective item, we will exchange it at our expense for shipping," or "We do not accept returns for products with no defects."
Other Items to Disclose
Beyond the basic items above, depending on the products or sales methods involved, the law may require disclosure of certain additional information.
- Quantity/time limits: When there are sales quantity restrictions (e.g., "limited to 100 units") or application deadlines for campaigns, etc.
- Display of licenses/qualifications: When selling alcoholic beverages, used goods (requiring a secondhand dealer's license), contact lenses (highly controlled medical devices), etc.
- Digital content: When it's necessary to state the operating environment (supported OS and specifications)
Be sure to check whether the products handled by your shop are subject to any special legal regulations, and confirm that consumers have all the information they need to make an informed decision.
How to Set Up the Act on Specified Commercial Transactions Notice on Shopify
Shopify comes with a built-in feature for creating policy pages, including the Act on Specified Commercial Transactions notice. There's even a dedicated template, making setup relatively smooth.
Setup Steps
Log in to the Shopify admin and click "Settings" at the bottom left of the screen. From the menu, select "Policies," then click "Act on Specified Commercial Transactions notice" at the bottom of the list.
Image source: Shopify
An input field will appear — enter the required information.
Once saved, a link will automatically appear in the checkout page footer. If you're unsure what to write, click "Insert template" to use the template provided by Shopify. Some fields are auto-filled based on your store information.
Displaying It in the Footer
Once you've created the Act on Specified Commercial Transactions notice page, it's common practice to display it in the site footer (at the very bottom) so customers can easily access it.
Some themes have a built-in feature to display policy links in the footer, so check whether yours does. Shopify's official free theme "Horizon," for example, displays it at the bottom of the page, as shown in the image below.
Reference: Shopify theme "Horizon"
If your theme doesn't have a policy-link display feature, add it to the footer menu manually. For instructions on creating menus, please refer to the article below.
What Must Be Displayed on the Final Confirmation Screen
Following a June 2022 amendment to the Act on Specified Commercial Transactions, it became mandatory to display key information — such as quantity, price, payment method, and return conditions — on the "final confirmation screen" immediately before an order is confirmed. (Reference: Consumer Affairs Agency)
On Shopify, as long as you've correctly entered your "Policies" and "Shipping settings" in the admin, this information is automatically reflected on the checkout screen. So if you've made the standard settings, no additional development is generally required.
That said, if you've customized the checkout screen with an app, or if your return terms are unusual, we recommend confirming — via a test order, for instance — that all required items are displayed correctly on your own screen, just to be safe.
How to Handle Cases Where You Want to Keep Your Address and Phone Number Private
Many people launching an e-commerce site as a sole proprietor worry about "not wanting to disclose my home address or phone number."
On this point, the Act on Specified Commercial Transactions has a mechanism that allows you to omit displaying your address and phone number, provided certain conditions are met. Specifically, both of the following two conditions must be satisfied.
- The advertisement states that, upon request from a consumer, the address and phone number will be disclosed without delay, in writing or by email.
- A system is in place to promptly disclose the information when actually requested.
If you take advantage of this provision, your notice page would include a statement such as: "Our address (and phone number) will be disclosed without delay upon request from consumers."
However, only the advertising display can be omitted — you cannot refuse to disclose the information itself. Be sure to prepare in advance so you can respond promptly when a consumer makes such a request.
It is also possible to list a virtual office address, but in that case you must have a system in place to "provide the information without delay upon a consumer's request." Also, confirm in advance whether the virtual office you use is eligible to serve as an "address under the Act on Specified Commercial Transactions."
Do You Need an Act on Specified Commercial Transactions Notice for Cross-Border E-commerce?
Many Shopify merchants run cross-border e-commerce businesses. Since the Act on Specified Commercial Transactions is a law established for consumers within Japan, if you sell exclusively to overseas consumers, you are not obligated to create an Act on Specified Commercial Transactions notice page.
However, this is different if your cross-border e-commerce store also allows purchases from within Japan. In that case, you are also selling to Japanese consumers, and the Act on Specified Commercial Transactions applies.
Additionally, Shopify requires "all Japan-based stores using Shopify Payments" to display an Act on Specified Commercial Transactions notice page. Even if your store targets an overseas audience, prepare this page if you use Shopify Payments in Japan.
Prepare Your Act on Specified Commercial Transactions Notice Before Publishing Your Shopify Store
The Act on Specified Commercial Transactions notice is an indispensable legal requirement for running an e-commerce site. Be sure to have this notice page prepared before publishing your store.
In addition to the Act on Specified Commercial Transactions notice, policy pages such as a privacy policy and terms of service are also essential for e-commerce operations. Shopify's "Policies" settings screen also lets you create a refund policy and shipping policy, so we recommend preparing all of these together before publishing your store.
If you're unsure about the accuracy of your content, consider consulting the Consumer Affairs Agency's "Act on Specified Commercial Transactions Guide" or a professional such as a lawyer.
