- What is the success fee?
If the client recovers a debt (in whole or in part) or damages, our fee is an agreed percentage of the recovered amount.
So if the client recovers JPY3,000,000 and the success fee is set at 20% then the success fee will be JPY600,000 (excl. tax).
- Does the cap include a consumption tax (VAT or GST)?
No. The cap does not include a consumption tax in Japan (also called VAT or GST in some other countries) and the client remains liable for paying consumption tax.
The rate is 8% as at 1 January 2019 but is planned to be increased to 10% from October 2019. So if the client recovers a debt or damages before October 2019 and the success fee is JPY600,000, the consumption tax will be JPY48,000 (JPY600,000*0.08) and the client pays us a fee of JPY648,000 (incl. tax).
- Does the cap include disbursements?
No. The client remains responsible for paying disbursements.
- What are disbursements?
Disbursements generally include court fees, courier fees, search fees, translation fees and travel expenses.
- How much are court fees?
The courts publish the Court Fee Schedule (Japanese).
According to the Schedule, if the client claims for JPY3,000,000 at first instance, JPY20,000 is to be paid as a court fee.
- Can the success fee be recovered from another (unsuccessful) party?
No. Generally, each party must pay its own attorneys’ fees.
However, as the case may be, we try to win a concession from the opponent by agreement out of court.
- Can interest be charged on late payment?
Yes. A 6% statutory interest rate is allowed to be applied to a claim arising from commercial transactions between businesses or businesses and individuals (Article 514, Commercial Code).
- Commercial claims
5 years from when the right holder can exercise its right (Article 522, Commercial Code).
Commercial claims mean claims that arise out of the commercial activities of one or both parties.
- Contractual claims
10 years from when the right holder can exercise its right (Article 167, Civil Code).
- Tort claims
3 years from when the right holder (1) discovers that he has suffered damage; and (2) knows the identity of the person or entity liable for the damage (Article 724, Civil Code).