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Overview
A sophisticated and wealthy market with a tech-savvy population, Japan is currently moving ahead with its Society 5.0 initiative. This government initiative aims to integrate cutting-edge technology into society to address social challenges such as the ageing population and decreasing birthrate, local depopulation and regional inequality.
Technologies that may be used to achieve this vision include robotics, artificial intelligence (AI) and advanced monitoring systems.
The technology sector in Japan relates closely to other sectors.
Robotics
With increasing use in a wide range of industries from hospitality to manufacturing to healthcare, robots are a growing market in Japan. In particular, AI for robots may be of interest to UK businesses looking to provide services in Japan
Healthcare
With an ageing population, the need for new, innovative healthcare technologies, such as wearable monitoring devices and telemedicine, is expected to grow
Nuclear
In 2022, Japan announced new nuclear projects to support Japan’s goal of carbon neutrality by 2050. Please see our energy exports to Japan explainer for more information
The UK’s technology sector is a thriving, innovative sector which ranked fourth globally in 2022. The UK is the third country, after United States and China, to reach the landmark of having a technology sector which is valued at over $1 trillion at the end of 2022.
Trade agreements between the UK and Japan provide many opportunities for UK technology exporters in the Japanese market. The agreements allow the UK further access to these opportunities and continue to cement both the UK and Japan as global leaders in technological innovation.
Trade agreements with Japan
The UK has 2 Free Trade Agreements (FTAs) with Japan:
- the UK-Japan Comprehensive Economic Partnership Agreement (CEPA) henceforth referred to as the UK-Japan FTA, which entered into force on 1 January 2021
- the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), a trade agreement including 12 countries (Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the UK and Vietnam) which entered into force between the UK and Japan on 15 December 2024
The following Parliamentary Report provides information about significant differences between the UK-Japan FTA and the EU-Japan FTA.
The UK-Japan FTA will remain in force alongside CPTPP. At times, you will need to specify which agreement you choose to trade under (notably when applying rules of origin), but benefits from either agreement will mostly apply automatically.
CPTPP entry into force and ratification
As of 15 December 2024, CPTPP is in force between the UK and:
- Brunei
- Chile
- Japan
- Malaysia
- New Zealand
- Peru
- Singapore
- Vietnam
This means that the UK can access CPTPP provisions with said countries.
On 24 December 2024, CPTPP will enter into force between the UK and Australia; this means that the UK will be able to access CPTPP provisions with Australia from and including 24 December 2024.
The following countries have not yet ratified the terms of the UK’s accession:
Canada and Mexico.
This means that the UK cannot yet access CPTPP provisions with those countries.
This guidance will be updated following each of the remaining countries’ ratification of the terms of the UK’s accession to CPTPP and will include when CPTPP will enter in force between the UK and the relevant remaining country.
The UK being part of the CPTPP trade agreement does not replace the existing UK-Japan trade agreement which has applied since 2021. UK technology businesses will be able to benefit from both agreements simultaneously.
Tariff-free technology products
Digital products are free from import tariffs. This includes apps, software and other electronic products traded between the UK and Japan, keeping trading costs low for digital technology exporters.
Many physical technology goods, such as robots, smart watches and sensors, receive a 0% Most Favoured Nation (MFN) tariff duty. When using MFN tariff duties, there is no need for businesses to prove their product is originating from the UK. Please visit the Check duties and customs procedures tool to find available tariffs for specific products.
For more information on tariffs, please visit our tariffs and customs guide.
Opportunities for digital trading
Electronic authentication, electronic contracts, and electronic signatures
Electronic signatures and electronic authentication increase trust in e-commerce by helping to verify that transactions, and the people behind them, are genuine. Strengthening the legal validity of electronic signatures provides greater confidence that transactions can be concluded through electronic means.
By using electronic signatures and/or electronic authentication, you can complete transactions in a matter of minutes regardless of where your counterpart is, reducing costs and simplifying processes.
CPTPP ensures that electronic signatures are considered valid and individuals and businesses can confidently use them.
However, CPTPP countries might impose specific criteria regarding electronic signatures, including some circumstances where electronic signatures are not accepted. You should check local regulations for more information.
Our agreements with Japan and Singapore also ensure that electronic contracts are legally valid and cannot be considered invalid just because they are in electronic form.
However, Japan and Singapore might impose specific criteria regarding the use of electronic contracts, including some circumstances where they cannot be used. You should check local regulations for more information.
You have the freedom to determine the best way of authenticating your transaction. However, for some transaction categories, there can be specific requirements.
The free flow of trusted data
The UK and other CPTPP countries have committed to allowing trusted data to flow freely between countries without unjustified restrictions. This is set out in Article 14.11 ‘Cross-Border Transfer of Information by Electronic Means'.
Data underpins everything from emails to electronic payments to shipments across borders. The deal will support UK businesses to provide modern services, ensuring that they can collect, process, and transfer data without facing unnecessary red tape.
These commitments provide a more certain and stable environment for businesses and do not interfere with the high level of protection afforded to personal data when it is transferred overseas. This is accompanied by a commitment that a framework must be in place for the protection of personal data in each CPTPP country, though these can be different regulations.
In the Article 14.13 ‘Location of Computing Facilities' CPTPP countries have committed to not imposing unjustified data localisation requirements (where data is required to be stored or processed in a specific territory as a condition for doing business in that territory).
The CPTPP countries have also committed to not imposing unjustified server localisation requirements (where a business is required to establish facilities in a specific territory).
This means you do not have to bear additional costs associated with storing or processing data overseas, nor do you have to set up new facilities in another country. These costs are particularly prohibitive for small and medium-sized enterprises (SMEs).
Please note that there might be exceptions to the information provided where you might still be restricted on where you move your data to, or you might be required to store your data in a specific location. You will still need to comply with UK and local regulations on data protection and data handling, which might be different across all CPTPP countries. You should consult domestic regulations on data protection and any local regulations on data localisation.
Further information can be found in our CPTPP trading digital guide.
Protection for your cryptography
Encryption is critical to shielding citizens and companies from a variety of threats including fraud, hacking and corporate espionage. Information and communication technology (ICT) products that use cryptography provide security to users that the information they transmit or store is processed in such a way that:
- requires user authentication
- only permits authorised users to access the information
Businesses selling ICT products will be able to enter the markets of Singapore and Japan confident that they will not be required to transfer or provide access to proprietary information related to cryptography. Nor will they have to partner or co-operate with another person or use a particular cryptographic algorithm to sell commercial ICT products in these countries. This protection applies to ICT products that are goods and services.
These agreements acknowledge that the UK, Singapore, and Japan still have the power to require a manufacturer or supplier of an ICT product to provide access, or preserve and make available, proprietary information related to cryptography, where necessary. For example, these may be required for certain regulatory investigations or judicial proceedings, including those related to competition law.
Services
Under the FTAs, UK businesses providing services in Japan will be treated on a level playing field to Japanese businesses (for sectors that are within scope), meaning British businesses will operate under the same rules of Japanese competitors. UK businesses are not required to have a business presence, such as a subsidiary or branch office, in Japan to provide services.
This would allow, for example, a UK business providing training to customers in Japan on how to use a software system to provide their service from the UK, without being excluded for being UK-based.
Japan and the UK are encouraged to recognise one another’s professional qualifications where areas of mutual interest are identified. While decisions on recognition are for the Japanese regulator to make, this could allow UK businesses greater access to the Japanese market in areas such as engineering.
Product regulation
Products sold in Japan must meet Japanese product regulations, regardless of whether they are exported to Japan under preferential tariff rates or not. While many products may need to be assessed by a body based in Japan, UK based conformity assessment bodies are eligible to apply to conduct conformity assessments against a limited set of Japanese regulations relating to electromagnetic capability and radio equipment.
Having assessments conducted in the UK may save businesses time and money, by avoiding additional transportation costs.
Assessment procedures that are currently available in the UK include assessment to requirements of the Japanese Radio Law (Law No 131, 1950), which covers most radio equipment for use in Japan. More procedures may become available in the UK over time, following the UK joining the CPTPP agreement (which Japan is also a member of).
This will be subject to UK conformity assessment bodies applying to conduct assessments against Japanese regulations and being granted approval by the relevant Japanese accreditation body (for example, Japan Accreditation Board or International Accreditation Japan, or directly by the Japanese Ministry of Industry and Commerce).
For further information, please see our Product regulation and testing guide.
Procurement
Government procurement opportunities allow private UK businesses to sell goods or services to foreign governments and public bodies at the central and local level, including numerous opportunities in the technology sector.
The UK-Japan agreement and CPTPP allow businesses greater access to Japanese government contracts. UK businesses will be treated the same as Japanese businesses when biding for government contracts. This covers public procurement contracts in Japan's Local Administrative Agencies and Core Cities.
The Japanese External Trade Organisation (JETRO) provides a list of national government and local government procurement notices. More information on government procurement in Japan can be found on the JETRO website.
Japanese organisations looking to procure goods and services include:
- Ministry of Education, Culture, Sports, Science and Technology
- National Institute of Technology and Evaluation
- Japan Science and Technology Agency
Visit our Procurement in Japan guide for more information, including where to find the full range of participating entities.
Easier business travel
Business mobility provisions in FTAs support the temporary movement of professionals to deliver services, negotiate the sale of goods, and invest in businesses in person.
The UK’s Free Trade Agreements help provide greater certainty and access for the temporary movement of highly skilled professionals between countries. These benefits give businesspeople more options and flexibility for business travel, as well as often allowing them longer periods of stay in other countries to carry out business activities. By way of example, under CPTPP, a lecturer employed by a UK University being transferred to a branch in Mexico can now stay for up to 4 years accompanied by their spouse.
For further information on the provisions in the FTAs for working in Japan, please see our Temporary Entry guide. Entry to Japan is subject to applicants meeting the relevant immigration requirements set out by Japan. For full details on visa requirements and applications, please visit the website of the Embassy of Japan in the UK.
Intellectual property
Japan has ambitious intellectual property regulations that support companies through adequate, effective protection and enforcement, encouraging innovation and creativity. Japan will protect intellectual property rights, applying criminal procedures and penalties as required. This includes enforcement in the digital environment.
Investment
UK and Japanese investors benefit from increased transparency and simplification of investment administration.
The UK has had huge success in attracting Foreign Direct Investment in the technology sector. In 2023, Toshiba invested more than £20 million in new technology development, designing and delivering advanced quantum-safe cryptographic communication solutions.
A more detailed explanation on the Investment provisions and how it can help businesses can be found in our investment guide.
Department for Business and Trade support
The Department for Business and Trade (DBT) helps businesses export, drives inward and outward investment, negotiates market access and trade agreements, and champions free trade. Helpful links, tools and services available from DBT and wider government include:
Export Support Service (ESS) team
Get support on how to do business abroad. You may also be eligible for 1-2-1 support from a local International Trade Adviser. Businesses in Wales can also access support from Business Wales.
Export Support Service – International Markets (ESS-IM)
DBT's overseas in-market export support service for SMEs with high-export potential. Our International Market Advisers provide tailored support and market introduction information to new and current UK exporters looking to enter or expand into new markets. The service may be accessed globally with International Markets teams in South Asia, China, the Middle East, Africa, Eastern Europe, North America and Latin America.
Sign up to access free training on how to grow your international sales.
Information on finance and insurance for UK exports.
Trade and investment factsheets
The latest statistics on trade and investment between the UK and individual overseas partners.
Overseas business risk profiles
Information for UK businesses on political, economic and security risks when trading overseas.
Advice and warnings about travel abroad, including entry requirements, safety and security, health risks and legal differences.
Check or report a trade barrier
If you encounter an issue when exporting to any country – report the issue and UK government officials will be able to assess the issue and consider the options we have open to addressing it as appropriate
Search for your specific product to find applicable tariffs for each market, explore rules of origin and step-by-step help on customs procedures
Check import duties and allows you to check the status of available tariff rate quotas
Useful resources
You can find more information about export opportunities, business culture and any existing trade barriers on our Japan market guide.
Prior to export, you must be aware of local regulations and import conditions in Japan that apply to your goods or services. This can include tax considerations, labour laws, intellectual property rules, labelling and packaging regulations, among others.
To seek further information related to local regulations, business culture, or to find a local lawyer, translator, importer or distributor, you can use the following contacts:
- DBT’s Export Support Service International Markets team
- get in touch with DBT at the local British Embassy
- get in touch with the British Chamber of Commerce in Japan
To see information on political, economic and security risks when trading with Japan, please see: