Hiring a Freelance Translator in Japan?
What the Freelance Act Expects From the Client

Quick Answers

What is Japan's Freelance Act?

The Act on Ensuring Proper Transactions Involving Specified Entrusted Business Operators (Act No. 25 of 2023), in force since 1 November 2024. It sets rules for businesses that commission work from self-employed individuals with no employees, covering both fair dealing and working conditions.

What does it require of a client?

Every client must state the terms of the work in writing or electronically. Clients with employees also have to pay within 60 days of receiving the work, avoid seven prohibited practices on engagements of a month or more, and meet further duties on recruitment ads, harassment and ending long engagements.

TL;DR

If you commission a Japanese freelancer, put the scope, deadline, fee, payment date and (if you check the work) the inspection date into the order itself, in writing or by message. If your company has employees, set a payment date no later than 60 days after you receive the work, and do not cut the fee, reject delivery or demand free rework after the fact. Whether the Act reaches a company with no presence in Japan is not settled in the official guidance we reviewed, so treat this as general information and check with Japanese counsel.

Key Takeaways

• The terms must be stated up front. This applies to every client, including a freelancer who sub-contracts to another freelancer.
• The payment clock starts at delivery, not at invoice. Clients with employees must pay within 60 days of receiving the work, as early as possible within that window.
• Seven practices are prohibited on engagements of one month or longer, including reducing the agreed fee and demanding rework the freelancer is not responsible for.
• Longer engagements carry more duties. Six months or more brings a 30-day notice requirement before ending or not renewing the engagement.
• Cross-border application is not settled here. We do not say the Act does or does not apply to a company outside Japan. This is not legal advice.

Who the Act Protects, and Who It Binds

The law's official name is long: the Act on Ensuring Proper Transactions Involving Specified Entrusted Business Operators. It was passed in April 2023 and came into force on 1 November 2024. The Japan Fair Trade Commission (JFTC) and the Small and Medium Enterprise Agency handle the parts about fair dealing; the Ministry of Health, Labour and Welfare handles the parts about working conditions.

The protected party is the "specified entrusted business operator", which in practice means a freelancer: an individual who takes on work as a business and has no employees, or a company with a single representative, no other officers and no employees. According to the JFTC's Q&A, an employee for this purpose is someone expected to work at least 20 hours a week and to be employed for at least 31 days. A translator working alone under their own name fits the definition. So does a one-person company set up for tax reasons.

The law then splits clients into two groups, and the split matters more than anything else in this article:

• Any business that commissions work from a freelancer has one core duty: to state the terms clearly when it places the order.
• A client with employees, or a company with two or more officers (the law calls it a "specified business entruster") carries the full set of duties described below.

Most companies reading this, including small SaaS teams, are in the second group.

Duty One: State the Terms When You Place the Order

The client must give the freelancer the terms of the work in writing or by an electronic method. The JFTC's Q&A lists the items to include:

1. The names of both parties
2. The date the work was commissioned
3. What is to be delivered or performed
4. The delivery date or service date
5. The place of delivery or service
6. The fee and the payment date
7. If you will inspect the work, the date the inspection will be completed
8. If you pay by something other than cash, the payment method

Email counts, and so do chat tools, SMS and the message functions of social networks and websites. That is convenient, because most localization work is ordered in a chat thread. It is also where the gaps appear. "Can you do the onboarding strings by Friday? Usual rate" is a message, but it is missing the date of the order, an unambiguous fee, a payment date and any word about review. The JFTC also suggests keeping screenshots when the terms are sent through a cloud service or web tool.

Duty Two: Pay Within 60 Days of Receiving the Work

For clients with employees, the payment date must be set within 60 days of the day the deliverable is received, and as early as possible within that window. The clock starts when you receive the file, not when the freelancer invoices you and not when your reviewer gets round to checking it. If no payment date is set, or a date beyond 60 days is set, the law treats the date of receipt, or the 60th day, as the payment date.

A month-end closing cycle is permitted, but a file delivered on the first of the month still has to be paid within 60 days. Setting a long, fixed cycle — "net 90 from invoice", common in some head-office procurement systems — is the usual way a foreign client ends up outside this rule without noticing.

There is a narrower rule for re-commissioning. If you are an agency passing on work your own client gave you, you can set the freelancer's payment date within 30 days of the date your client pays you, provided the order states that it is a re-commission, names the original client and gives that client's payment date.

Seven Practices You Cannot Use

On engagements that run for one month or longer, a client with employees must not:

• refuse to accept work that was delivered as ordered;
• reduce the agreed fee after the fact;
• return work after accepting it, when the freelancer is not at fault;
• set a fee that is unreasonably low compared with the usual rate for similar work;
• force the freelancer to buy or use the client's goods or services;
• demand money, services or other economic benefits without a proper reason;
• change the content of the work, or demand it be redone, without proper reason and at the freelancer's expense.

The last item is the one localization teams should read twice. When a product team changes the source strings after the translation has been delivered, that is new work, not a correction. Asking for it under the original fee is the kind of request the law is aimed at.

Duties That Depend on Size and Length

A client with employees also has duties that sit closer to employment law, administered by the Ministry of Health, Labour and Welfare:

• Accurate recruitment information. When you advertise for freelancers, on a job board or a crowdsourcing site, the ad must not be false or misleading and must be kept up to date.
• Harassment measures. The client must put in place a system to prevent and deal with harassment of the freelancers it works with, including taking consultations.
• Consideration for pregnancy, childbirth, childcare and family care. For engagements of six months or longer, the client must give the necessary consideration when asked, so the freelancer can keep working alongside those responsibilities. For shorter engagements it is expected as an effort.
• Notice before ending a long engagement. To end, or not renew, a continuing engagement of six months or longer, the client must give at least 30 days' notice in writing or electronically, unless an exception applies, and disclose the reason if the freelancer asks for it.

Does This Apply to a Company Outside Japan?

Overseas clients often want a clear answer here, and we cannot give one. The JFTC's Q&A, which we reviewed for this article, does not address engagements between a client abroad and a freelancer in Japan. Whether the Act applies may depend on facts such as where your company operates, whether you have a Japanese entity and where the work is performed.

Our practical view is narrower. The duties are not burdensome, and Japanese freelancers increasingly expect clients to meet them. A clear written order, a payment date within 60 days of delivery and a fee that is not changed after the fact are things a careful client would do anyway. If you have a Japanese subsidiary placing the orders, the case for following the Act is stronger still. For anything beyond that, talk to Japanese counsel. Nothing here is legal advice.

Building It Into Your Localization Orders

Most of the work is in the order template. If you commission Japanese translators, reviewers or writers directly, three changes cover a great deal:

1. Write the order in Japanese, or at least bilingual

A freelancer cannot rely on terms they cannot read with confidence. A purchase order that exists only in English, with Japanese added by machine translation, is where misunderstandings about scope and payment start. A bilingual template, with the Japanese checked by a native speaker, reads like this:

2. Put the inspection date in writing

Localization work is usually reviewed before it is accepted, and the review step is where payment slips. Stating the date by which your review will be finished tells the freelancer when the work is accepted and stops the review from becoming an open-ended hold. Remember that the 60 days run from receipt, not from the end of your review.

3. Treat source changes as change orders

Agree in advance how changes to the source text after delivery will be priced, and send a new order for them. It protects the freelancer from unpaid rework and protects you from a dispute about what the original fee covered.

The same applies to the brief, the style guide and the termination notice. They are all documents a Japanese freelancer will read in Japanese, and their wording decides whether the terms actually say what your legal team approved in English. If you are also checking the companies you contract with, our article on anti-social forces screening covers the other side of Japanese vendor compliance.

Frequently Asked Questions