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Change in Japan Traffic Act Estimated to Cost Foreign Businesses Millions of Dollars in Lost Work Time 0

By Scott Reid, President, ReloJapan K.K.

It is confirmed. There is no way to get around the recent change to the Japan Traffic Act. The bottom line is, anyone staying in Japan for more than 12 months who wants to drive legally must obtain a Japanese Drivers License.

Article 107-2 means that 1000's of Expats across Japan are now driving illegally and could be facing hefty fines, imprisonment or default on their insurance claims.

What does this mean to you as an Expat living and driving in Japan? Or, as an HR professional, if you are responsible for Expats who are living and driving in Japan? We have spent several weeks working with local police authorities, government officials, insurance providers, and our legal department to ensure that all information to follow is as accurate as possible so read on to learn how this will affect you, and find out what your options are to solve this new problem and ensure you or your company is not at risk.

Up until June of this year, it has been recommended as an administrative guideline for anyone staying in Japan longer than 12 months to obtain a Japanese driving license. It was not a legal requirement and no penalties were enforced if you chose to continue to drive using a valid international driving permit. Considering the difficulties involved in obtaining a Japanese driving license, this is what the majority of Expats chose to do.

The change in the Japan Traffic Act known as Article 107-2, changes this administrative Guideline into an enforceable law. Click here to read an English translation of Article 107-2. International driving permits may only be used up to a period of 12 months after the first date of arrival in Japan, unless one were to leave Japan for a minimum period of 3 months in which case the 12 month countdown begins again.

Why has the law been changed one may ask? According to our contacts in the local authorities and from research conducted by our legal advisors, the intent of this change in law is to stop Japanese citizens, who have lost their licenses due to driving offences, from obtaining a license and international permit in a foreign country which would allow them to drive legally in Japan. It is highly unlikely that lawmakers even considered how this law change would affect the foreign business community in Japan, which is a group of approximately only 0.1% of the country's population.

The letter of the law states that the maximum penalty of driving without a valid Japanese driving license is a 300,000-yen fine or up to 1 year imprisonment. If you obtain your Japanese driving license after being caught driving without one, 12 points will be automatically deducted on the day you receive your new license. With only 15 points to begin with, this would mean that with one parking ticket your new Japanese driving license would be revoked for a period of 2 years.

Although these are very serious consequences, as is common in Japan, the change in the law has not been widely announced to the public. Our research has shown that this law change was announced in a Japanese document targeted to legal practitioners first in June of 2001 to be made effective from June 1st 2002, and that was the extent of the announcement. More recently the news is starting to make its way into English publications sponsored by the Ministry of International Affairs. As can be seen on the National Police Association's (NPA) English language web site, the organization responsible for administering this law change has yet to make any information available in English. http://www.npa.go.jp/koutsuu/license/u_constraction.htm. The announcement is as they say, 'Under Constraction' although the law has been in effect for more than 3 months.

There are those in the Expat community who are skeptical that the law change will be enforced. Can you imagine the Japanese authorities imprisoning the U.S. executive of a Fortune 500 company for driving in Japan on a valid international permit 13 months after arriving in Japan? Maybe. Maybe not.

Let's jump ahead to a car accident though, which history shows that foreigners in Japan have a high chance of being involved in, even if only a fender bender. We spoke with representatives of three major insurance firms in Japan. They all had similar responses. If their automobile policy holders were in a car accident and the police determined that the policy holder were driving illegally without a valid drivers license, the insurance company would only cover the cost of damages to the third party, but not any of the costs involved with damage to the policy holder or to their automobile.

A second issue involving insurance is that insurance policies are renewed on an annual basis, and depending on the insurance company, one may be asked to submit proof of a legal driving license in Japan. If one cannot prove this, the insurance will not be renewed, and in addition to the license, it is illegal in Japan to drive without at least the compulsory insurance (JCI).

It is the insurance issues in particular that should cause Expats and their employers the most concern. We at ReloJapan highly recommend that all Expats who live in Japan more than 12 months and who drive at any time beyond that to obtain their Japanese driving license.

It is a difficult, time-consuming process for most Expats to obtain their Japanese driving license. If one has, for example, an Australian, New Zealand, British, Swiss, or German driving license only some steps of the process are required. On the other hand, Americans and Canadians are required to complete the entire process.

First an official translation of your home country-driving license needs to be obtained at the local Japan Automobile Federation (JAF) office. The license needs to clearly state the date issued, showing that one had the license at least 3 months before entering Japan. If this is not shown on the license, an official letter from the Department of Motor Vehicles (or similar in one's country) translated into Japanese in addition to the license will be required.

Next is a visit to the local driving test center where one will need the original license, the Japanese official translation, passport, alien registration card, 1 passport-sized photo and the application fee. After completing the application and eye exam there will be a written test. If you successfully pass the written test, then the road test can be scheduled for a different day. Although the written test should be in English, it is not likely that any of the staff will speak English to assist with the process and the applications are only in Japanese. The above process takes most part of a full day out of the office and the test centers are only open from 9:00 am to 3:00 pm Monday to Friday.

The most time-consuming aspect of the test is the driving portion, as most foreigners need to take the test 3 or 4 times in order to pass. It is very rare for a foreigner to pass on the first attempt. Each attempt requires most part of a work day. Lessons for the test are available, in Japanese only of course, for approximately US$ 100 for a one-hour period. The lesson is recommended, not for the purpose of learning how to drive but rather to learn what it is the examiner will be looking for. To read one American's experience, check out http://www2.saganet.ne.jp/mnorkin/page25.html.

For the human resource professional, if you expect your employees to drive to work, or to be able to drive for their own pleasure during their time in Japan, you need to consider the level of support you will provide. Everything from providing your employees with time off to complete the process, covering the fees for the applications and providing bilingual accompanied support will need to be evaluated and included in international assignment policies.

As there are now many Expats in Japan who must obtain their Japanese driving license, ReloJapan is organizing a group registration project in the cities of Tokyo, Yokohama, Osaka, Kobe and Nagoya. For more information on this group registration project, please contact us at driverslicense@relojapan.com.

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About the Author

AS ReloJapan - Driver's LicenseReloJapan - A New Level in Japan Relocation Support Services - Comprehensive Japan relocation services, tailor made programs available to meet your specific needs.

ReloJapan has launched Japandriverslicense.com specifically to assist expats with obtaining their Japanese Driver's License.

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First Published: Nov 12, 2002

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