E-Commerce and Selling Overseas – Spotlight: Japan

Your designs are cutting edge.  You promote through multiple online channels and are quickly building a brand.  Appetite for your apparel is growing and you are now beginning to receive inquiries from buyers overseas.  You’ve never considered selling internationally because it just sounds so complicated.  Is it?  Not so much, actually.  Selling globally through e-commerce channels isn’t that much different than selling online in the U.S.  There are some adjustments to make, both legal and societal, that vary from country to country, so checking with an experienced advisor should help you clarify any pitfalls before you open up new global channels.

e-commerce, international law, privacy lawsLet’s take a look at Japan, for example.  Many countries, including the US, have e-commerce privacy laws that dictate how personal information may be collected and used.  Most state that personal data should be lawfully collected for limited and specified purposes, and should be accurate, protected, and kept confidential.  Japan is no different, having begun enforcement of their online privacy laws in 2005.  However, Japanese society has struggled to adapt to this law.  Culturally, the tendency to err on the side of sharing too little personal information, rather than too much, remains.  This can cause anxiety for you the seller when your product lines enter this market.  You have to ensure compliance with the law while not always getting what you need to do so.

An example of why attention to various overseas e-commerce laws is important is with respect to data leaks.  Once again, in Japan, the company selling into the market (whether online or direct) is liable for such breaches.  These can include fines or jail time, or compensation of anywhere from $5 to several hundred dollars per person affected.  This may seem small but it can add up in a hurry.  Legally speaking, these risks are quantifiable.  Culturally speaking though, losing this bet becomes a brand killer – many agree that the damage to the company’s reputation would ultimately be the greatest cost.

Today’s e-commerce platforms make it easy to quickly expand your reach overseas. When selling in Japan, or any other overseas market, knowing a bit about the legal and business environment can save you from surprises down the road.  It is worth noting that 95% of the world’s market for your product lines lies outside of the US, so don’t be afraid to take steps to broaden your reach.  There are multiple resources available to help you.  Consult a trusted advisor, and focus on what you do best – creating designs and building your brand.

Eriko “Elly” Baxter is a Senior Counsel at Desh International Law. She focuses her practice on a broad range of business law, both international and domestic. Her experience includes mergers and acquisitions, information technologies, software licensing, data privacy, real estate, contract negotiations and disputes.  Previously, she worked as an attorney at IBM Japan where she handled countless IT deals and a wide variety of business matters, including cross-border transactions. Eriko can be reached at ebaxter@deshlaw.com.

Michael Messina is Desh International Law’s Senior International Trade Consultant. Helping the firm’s clients with cross-border success is of paramount importance and Mr. Messina works together with his colleagues to provide advice on market entry, legal considerations and navigation of the international business environment. For overseas companies entering the U.S., domestic companies contemplating international expansion, or multinationals navigating legal issues in various countries, Mr. Messina lends his expertise and experience to Desh International’s clients and works to ensure their business and legal success. Michael can be reached at mmessina@deshlaw.com.

Author: Michael Messina

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