License for Handling Alcoholic Beverages in Japan | SME Japan | Business in Japan (2024)

Japan does not have many rules about production, import, or distribution of alcohol compared to other countries. However, it has several types of alcohol licenses that you need to have if you want to be involved in the alcohol business. This guide is focusing on alcohol handling as a primary activity of your company.

It will help you to learn more about the types of alcohol licenses required to run retail or wholesale alcohol store, import or export alcoholic beverages for selling purposes, and to brew your own alcoholic drinks. These three spheres will be described in each section of this article in this particular order.

In case you want to find out about alcohol handling as a part of your other business (for example a bar or a restaurant), please refer to the guide about the food industry licensing.

When you handle medicine that contains alcohol as an ingredient you need to comply with pharmaceutical norms. Please refer to the pharmaceutical license guide.

What drinks are classified as the alcoholic beverages?

In Japan the beverage is classified as an alcoholic one when the content of ethyl alcohol in it is 1% or more. The content of alcohol is expressed by the percentage of the ethyl alcohol per hundred-weight at 15 degrees Celsius as defined by Japan External Trade Organization (JETRO).

When is an alcohol license not needed?

• You serve alcohol before midnight as a part of your restaurant business and alcohol comprises the smaller part of your menu (see the restaurant license guide).
• Crude alcohol is exempt from import notification requirements when used as manufacturing ingredients.
• You sell alcohol outside Japan to a Japanese company or trader, who will then deal with the import procedures and further handling inside Japan.
• If you plan to produce fruit liquors by adding fruits to the existing liquor for a private use according to the following rules:
  • The strength of the initially used liquor should be at least 20% of alcohol,
  • You can add fruits to the liquor, but the following ingredients are prohibited: amino acids or their salts, barley, barnyard millet, corn, food colorings, grapes, kaoliang, koji made with cereal, millet, non-organic salts, nucleic acids hydrolyzates or their salts, organic acids or their salts, proso millet, rice, spices, starch, vitamins, wheat, wild grapes.
  • The strength of the new fruit liquor should not rise over 1% compared to the original liquor strength.
• Some other exceptions to the rules may apply. Always consult the tax office before engaging into activitywithout a license.

What to keep in mind when handling alcohol?

Proper marking

Make sure that your alcohol handling establishment can be clearly identified as a place that deals with the alcohol. In the case of a store, you need to have a plate notifying visitors about the nature of your establishment. For example, “liquor shop” or similar. The parameters for such plate and the size of letters are set by the legal regulations. You can get the exact requirements for the plate from the local authorities.

Your shop should also have a visible notification about not selling alcohol to young people. The legal drinking age in Japan starts at 20. Always confirm your customers age before serving or selling the alcoholic beverages to your clients.

Premises

Your alcohol handling facility should be a separate premise.

The alcoholic beverages should be stored in the shop where you sell it or in the warehouse meant for alcohol storage. You cannot keep, sell or prepare alcohol in the place of your residence. If you plan to do so, you have to:

• ask for permission from the landlord and/or residential community to use your apartment as a storage, and
• obtain a warehouse license for the premises where you want to keep the alcohol.

Also, you cannot combine the restaurant and a liquor shop in one space. Restaurants that serve alcohol from opened bottles as a part of their menu and the liquor shops that sell unopened bottles and make a profit from it pay different taxes. Thus, you cannot have a restaurant license and the liquor seller license for one establishment at the same time. If you are operating both, prepare two different rooms for the diner and for the shop or separate the dining hall from the liquor shop in a clearly identifiable manner. You can ask for advice on how to do it the proper way from the local authorities.

What factors influence the need for an alcohol license in Japan?

The type of alcohol license depends on but is not limited to the following factors:

• Designated use of alcohol: importing/exporting, selling, using alcohol as a culinary ingredient, etc.
• Place of production: Japan or a foreign country.
• Amount of alcohol handled: retail or wholesale.
• Opening the bottle: selling alcohol inside the establishment (opening the bottles in the same establishment and offering it to the guests) or selling unopened bottles as a takeaway.
• Target audience: general public or shops/restaurants.
• Means of sale: traditional physical shops (liquor shops, mass merchandisers, convenience stores, discount liquor stores, department stores), internet shops, printed catalogs and mail-order, etc.

Types of licenses

Selling

According to JETRO,there are five major types of licenses for selling alcohol. The scope of their action is described below:

• Wholesale
  • Wholesale dealer’s license for all alcoholic beverages: you can run a wholesale of all types of alcoholic beverages of Japanese of foreign origin but you cannot run a retail sale.
  • Wholesale dealer’s license for Western liquor: you can run a wholesale of all types of Western alcoholic beverages (excluding beer and Japanese alcohol) but you cannot run a retail sale.
  • Wholesale dealer’s license for imported alcoholic beverages: you can sale imported alcoholic beverages of all types to other retail shops but you cannot run a retail sale yourself.
• Retail
  • General retail dealer’s license for alcoholic beverages: you can sell all types of Japanese and foreign alcohol to general consumers within your distribution area but you cannot run a wholesale. This is the most common type of license.
  • Mail-order retail dealer’s license for alcoholic beverages: you can sell all types of Japanese and foreign alcohol to general consumers and restaurants via mail-order, internet shop, catalog, etc. Note that the amount of import should be less than 100 kiloliters per year.

Import/export

If you plan to import alcoholic beverages in Japan in order to resell them you need to obtain an import license. It should be ready before your alcohol packages arrive at customs for clearance. Without the license customs will not be able to clear your packages.

If you plant to sell alcohol from Japan to a company in another country and such company does not have a judicial entity within Japan, you need to have an alcohol sell license. The branch office of the buying company in Japan still does not qualify as the legal entity.

Brewing

After the relaxation of brewing laws in 1994, Japan allows individuals to get a brewing license to produce alcohol starting at 60 000 kiloliters per year. You can also make fruit liquors by adding fruits into existing liquors for private use.

Requirements

The core requirements for alcohol handling licensing are the same for almost all types of licenses. The Tax Office will explain to you what kind of documents you need to provide in order to get your license depending on your type of business. Please remember, that the authorities can ask you for more supporting documents in the process of decision making, even if such documents were not mentioned during your application. Thus, the list below may be longer in your particular case.

Selling

To apply for an alcohol-selling license you will need to:

• Have 3 or more years of the relevant experience in alcohol manufacturing and/or sale. Part-time involvements might also be counted into years of experience.*
• Have 3 or more year of experience in food seasoning selling business.*
• Appoint an alcohol beverage supervisor (manager) from among your full-time employees. You can also perform the duties yourself if you have qualifications.
• The appointed manager has to take a lecture about handling alcohol and renew it every 3 years.*
• Appoint an acting representative of the manager in case the appointed manager has to be out of the store for more than two hours during the opening time.
• Inform the Tax Office about the appointment of an alcohol beverage manager and their representative within two weeks after such appointment.

* Years of experience from these two categories can be counted together. For example, it should not be a problem if you have 1 year of alcohol manufacturing experience and 2 years of experience in food seasoning business. Sometimes the lecture on alcohol handling can also act as a substitute for the years of experience. Be sure to ask the tax office about the options available for you.

Import/export

The main supervising authority for import and export is the Quarantine station and its branches in different ports of entry. When importing alcohol you need to:

• Submit the “Declaration of imported food, etc.” to the quarantine station managing the port of entry used for importation. You can use imported alcohol in your food establishment as an ingredient or serve it to the guests as a part of your menu.
• Have a license to sell alcoholic beverages from the Tax Office, if you plan to sell the imported alcohol as a takeaway at your food establishment or you will sell it uncorked to other people or establishments.
• Provide the description of products you are importing on the shipping packaging in an easy-to-see and easy-to-read manner. Such information can be, for example, the strength of the beverages, their ingredients, etc.

Brewing

If you plan to brew your own alcoholic drinks make sure to also follow the requirements for you brewery: sanitation norms, processing standards, etc. Your license to brew will be given by the Tax office, but the food production requirements are managed by the health care centers. The Tax Office and the healthcare center can provide you with more detailed information specific to your business.

Where to apply?

The vast majority of alcohol-related licenses are handled by the Tax Office and its local branches because alcohol handling is mainly regulated by the Liquor Tax Law (also known as the Liquor Tax Act). Tax offices responsible for the area where your business is located can advise you on needed documents for your application and appropriate procedures. This rule is applicable for all the licenses regarding the sale, import/export, and brewing.

Needed Documents

As it was mentioned in the previous paragraph, the required documents for the license application are mostly the same. The Tax Office can give you more information or can ask for more supporting and clarifying documents. You may need to prepare some or all of the following documents as well as any other document the Tax Office will ask for:

• An application form for the license (salling, import/export, brewing).
• If the business will be done by a legal entity (corporation) then all the officers and auditors should also submit their resumes.
• Any certifications proving your knowledge, skills, and experience in the business you are planning to start.
• Documents about the property where you run your business (rental contract, permission from the landlord, permission from the community of the house where you own the apartment, etc.). It is always good to have a separate office at this stage.
• Description of your business facilities.
• Financial statements for the past three years (there should be no more than 20% loss for the past three years):
  • For individuals: income and expenditure statement (shushi keisansho).
  • For companies: balance sheets.
• Prove of your tax payments. There should be no gaps in payments for the past two years. The accounting period in Japan is from 1^st of April to the 31^st of March.
• Documents explaining the mean of selling (a catalog copy, a printout of your web-store pages, etc.).
• Inform the Tax Office about the state of your inventory (sold and purchased items) by the end of April each year. Inventory entries should be archived for 5 years.
• Clarification of supplier(s) in case of the restaurant or shop: wholesale or importer.
• A detailed and well-written business plan explaining your alcohol business idea and operations. It should mention your possible suppliers and customers, income and loss projections, expected sales, etc.
• Documents about your funding: you individual funds (e.g. copy of a bank book), investment agreements, loans, etc.

Application process

1. Submit application to the Tax Office.
2. Provide all the additional documents if/when requested.
3. Prepare your facilities for operation.
4. Apply for an inspection of your business property (about two months in advance), if needed.

Application Fee

It costs around 30 000 yen to apply for the alcohol handling license. The local branch of Tax Office can give you the precise information.

Summary

License for alcohol handling is an umbrella term for a wide variety of activities related to production, logistics, and consumption of alcohol. You can always find up-to-date information regarding the application fees and procedures as well as guidelines for your particular case from the Tax office of Japan.

Be sure to obtain your license before the start of operations in order to keep clear of fines and legal consequences for running a business without a license. Also, keep in mind that the age limit for alcohol consumption in Japan is 20 years of age. Thus, always check the identity and the birth date of your customers before handling them alcoholic beverages.

What will happen if I operate without a license?

What are the tariffs for alcohol import?

What Laws regulate alcohol business in Japan?

• Food Sanitation Act
• Liquor Tax Act
• Customs Act
• Liquor Business Association Act (Act on Securing of Liquor Tax and on Liquor Business Associations)
• Pharmaceutical Affairs Act
• Product Liability Act
• Act on Specified Commercial Transactions
• Act on the Promotion of Sorted Garbage Collection and Recycling of Containers and Packaging
• Minor Drinking Prohibition Act

What is the legal drinking age in Japan?

Can I brew alcoholic beverages at home?