A recommendation submitted by the Global Research & Policy Institute (GRPI) has been reflected in the Japanese government's Regulatory Reform Implementation Plan, with the Cabinet approving a review of the so called "lack of substantiation" advertising regulation.
In March 2026, GRPI submitted recommendations to the Cabinet Office's Regulatory Reform Promotion Office on measures to restrain misleading advertisements and representations that impede consumers' voluntary and rational choice.
The first recommendation called on the Consumer Affairs Agency (CAA) to publish the grounds for its judgments in administrative actions taken under the "lack of substantiation" advertising regulation. Under this system, businesses may be subject to administrative action if they fail to submit objective evidence substantiating claims regarding the efficacy or performance of their advertisements within a prescribed period. Such cases account for nearly 60 percent of the CAA's recent administrative actions under the Act Against Unjustifiable Premiums and Misleading Representations.
GRPI recommended that the CAA publish the specific grounds for these decisions, noting that its published decisions currently provide only a general statement that the submitted materials were not recognized as constituting reasonable substantiation, without explaining why they were considered insufficient. Publishing these reasons would improve regulatory transparency while also enabling businesses to develop more accurate AI tools for reviewing advertisements before publication.
This recommendation was reflected in the Regulatory Reform Implementation Plan, adopted by the Cabinet on 21 July, 2026. The Plan provides that, after broadly soliciting views from businesses, consumers, and other stakeholders during the current fiscal year, the government will consider requiring the CAA, when issuing administrative orders under the lack of substantiation regulation, to provide a concrete explanation of why the submitted evidence was not regarded as constituting reasonable substantiation and to publish those reasons while appropriately protecting confidential business information. The government aims to reach a conclusion during the next fiscal year and implement the necessary measures without delay.[1]
GRPI welcomes this decision and believes it reflects the substance of our recommendation. We will continue to monitor the CAA's review process to help ensure that the commitments set out in the Regulatory Reform Implementation Plan are fully realized.
The second recommendation called for granting qualified Fair Trade Councils the authority to seek injunctions against misleading advertisements made by businesses that are not participants in Fair Competition Codes. This would complement the CAA's enforcement activities by enabling qualified industry bodies to address misleading advertisements in sectors where administrative resources are increasingly stretched.
According to the CAA's response, published on June 19, 2026, the recommendation was not accepted. The Agency stated that if businesses that are not participants in a Fair Competition Code engage in misleading representations prohibited under the Act Against Unjustifiable Premiums and Misleading Representations, the CAA will continue to take strict enforcement action under the existing legal framework.[2]
While GRPI notes the Agency's response, it does not address the substance of our recommendation or the structural challenge it was intended to address, namely the growing gap between increasing enforcement demand and the government's administrative capacity. Rather than considering complementary enforcement mechanisms, the response simply reiterates the existing enforcement framework.
GRPI will continue to examine the legal and institutional issues surrounding this recommendation while engaging with relevant stakeholders to advance discussion on strengthening Japan's consumer protection framework.
References (Japanese only)
[1] Cabinet Office of Japan, Regulatory Reform Implementation Plan (Cabinet Decision of July 21, 2026),内閣府『規制改革実施計画（令和8年7月21日閣議決定）』 pp. 164–165.
https://www8.cao.go.jp/kisei-kaikaku/kisei/publication/program/260721/01_program.pdf
[2] Cabinet Office of Japan, Proposals Received through the Regulatory Reform and Administrative Reform Hotline ("Vertical Administration 110") and Responses from Competent Ministries and Agencies, FY2025, Material 2, 内閣府『「規制改革・行政改革ホットライン（縦割り110番）」で受け付けた提案及び所管省庁からの回答について 資料２ 検討要請に対する所管省庁からの回答 ◯規制改革 令和7年度 回答』p. 115.
https://www8.cao.go.jp/kisei-kaikaku/kisei/hotline/siryou2/k_siryou2_r7.pdf