Japan: The New Imperial Era "Reiwa" And What It Teaches Businesses In Japan

Last Updated: 17 June 2019
Article by Junichi Kato

As Japan enters a new Imperial era of "Beautiful Harmony", companies need to understand the long cultural traditions that often confound foreigners trying to do business there.

The changeover from the old "Heisei" to the new "Reiwa" era happened in Japan on 1 May 2019. As Crown Prince Naruhito stepped up to the throne following his father's abdication, he became Japan's 126th Emperor, signalling the true depth of Japanese culture and tradition. Era names originated in China more than 2,000 years ago, a commonplace in several Asian countries. Only Japan maintains the tradition – and reveres it. Considerable care is taken in the selection of era names. Reiwa originated in the Manyoshu anthology, a 1300 year-old collection of poetry – Japan's first.

The word "Rei" is usually translated as "orderly" or "auspicious" but in a poetic sense relates to the viewing of the cherry blossom season in Japan, with "wa" meaning harmony. It infers, therefore, a period of peace and "Beautiful Harmony".

The importance of the Japanese imperial calendar

Reiwa is important to businesses operating in Japan as it forms the first part of the Japanese imperial calendar scheme. We have just entered Reiwa 1, which may be shortened to R1 in romanised form following similar usage in the past four eras. The first year formally commenced upon the accession of the new Emperor on 1 May but will end on 31 December 2019, continuing in line with the Gregorian calendar years. 1 January 2019 until 30 April 2019 will continue to be known as Heisei 31 – the name of the pre-Reiwa era.

This is important to businesses for, although the Gregorian calendar is now used in business contracts and for most everyday purposes, the Japanese imperial calendar is used for many official documents such as a bankbook, Certificate of Family Register and Certificate of All Records. Usage on driving licences, however, is expected to change soon. Many individuals refer to their birth date using the Japanese imperial calendar and official forms often require the date of birth to be stated accordingly, which can confuse foreigners. For example, a child born on 30 April 2019 will have a birth date of H31 April 30 but a child born on 1 May 2019, will have a birth date of R1 May 1.

Staying up to date

The major technology companies have responded quickly to the start of the new era, updating Windows, Java and all major platforms in readiness. However, foreign companies need to make sure that systems supporting Japanese businesses include the latest updates on their technology platforms to avoid any errors that may otherwise occur when generating official documents.

Doing business in Japan

Given this depth of cultural tradition, it is important for businesses to know how to conduct themselves if they want to be successful in Japan. Showing respect is crucial and foreigners would do well to observe how Japanese business people conduct themselves and follow suit. Should you need to refer to the Emperor whilst in Japan, it would be considered disrespectful to use his given name: he should be referred to as "His Imperial Majesty the Emperor" and most definitely not by era name, which he will only become known by posthumously.

Whilst not directly affecting businesses beyond the change of the calendar, this should be a clear lesson to foreign businesses in just how traditional and complex doing business in Japan can be. It is always best to consult local professionals who can help you navigate the complexities of local processes and procedures and have a deep understanding of this most traditional of cultures.

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TMF Japan can help you to navigate the complexities of launching or expanding business activities in Japan, covering the rules and regulations and the cultural and traditional. To learn more about our accounting and tax, corporate secretarial and HR and payroll services, contact us today.

Download the Global Business Complexity Index to discover if Japan is the most demanding place for firms to operate in.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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