0. Outline of Cross-Border Consumer Center Japan (CCJ)
June 2015
Consumer Affairs Agency Japan

1. Globalization of Economy and Expanding Internet Usage
It is becoming increasingly easier to do business across borders due to the globalization economy and the spread of Internet usage.
- Rapidly Expanding E-Commerce Market in Japan -
- Increasing Cross-Border Business -
(Hundreds of
millions of yen)
Size of consumer cross-border e-commerce market in 2013 between Japan, the United States and China (estimated total)
417.1 billion yen
United States
719.7 billion yen
China
807.2 billion yen
285.7 billion yen
432.3 billion yen
390.2 billion yen
Japan
billion yen
17.9 billion yen
173.6 billion yen
The arrow indicates the direction of the sale
Indicates the total cross-border e-commerce purchase amount
Source: Ministry of Economy, Trade and Industry’s “FY2013 Report on the Foundation of an Information and Service Economic Society in Japan (Market Survey on E-Commerce)”

2. Examples of Problems with Cross-border e-Commerce in Japan
Counterfeit goods delivered
Paid but not delivered
Defective / Broken products delivered
Delay in delivery
Unauthorized Charges
No response from the retailers

3. Cross-border Consumer Center Japan (CCJ)
Establishment
Established by the Consumer Affairs Agency of Japan (CAA) in November, 2011
Roles
Providing advisory services and information related to cross-border transaction upon the request from consumers by , fax or web-site
Assisting the resolution of disputes over transactions between Japanese consumers and overseas business entities or between consumers in other countries and Japanese businesses
Operation
Operated/funded by the CAA until the end of March, 2015
From April, 2015, operated/funded by the National Consumer Affairs Center (NCAC)
Entrusting practical operations of the CCJ to the private sector

4. CCJ’ s Overseas Partners
To solve consumer problems with cross-border transactions, CCJ cooperates with 6 overseas organizations
Spain
United States and Canada
CCJ
March 2014 ~
November 2011 ~
Singapore
Taiwan
Central and South America
November 2011 ~
Vietnam
November 2011 ~
February 2012 ~
January 2015 ~

5. Consultation Flowchart
The sole organization dealing with cross-border consumer complaints
Mutual relationships with overseas consumer support organizations
Japan
Overseas
1’. Consultation
Problem
5’. Advice
Consumers
Businesses
1. Consultation
3. Conveys consultation details
presents solutions
Problem
Nation-wide
consumer affairs centers
Consumers
Businesses
5. Convey answers
offer advice
1. Consultation
3. Conveys consultation details
presents solutions
5. Convey answers
offer advice
Support
2. Translate and convey consultation details and seeks advice regarding solutions
CCJ: Cross-border Consumer Center Japan
Overseas consumer affairs organizations
(Six organizations in the United States, Singapore, etc.)
4. Translate and convey answers

6. Handling Consumer Complaints
Handling consumer complaints in the following steps.
Problems between Japanese consumers and US businesses (Example)
Problems between US consumers and Japanese businesses (Example)
1. A problem occurs between a Japanese consumer and US
business
2. Consumer consults with CCJ
3. CCJ conveys the details to the BBB in the US, one of CCJ's
overseas partner
4. The BBB conveys the consultation details to the business
and agrees on a solution
5. CCJ conveys the answer from the business to the consumer
6. The transaction is performed between the consumer and
the business based on the agreed solution
1. A problem occurs between a US consumer and Japanese
business
2. The consumer consults with the BBB 3. The consultation
details are conveyed from the BBB to CCJ
4. The consultation details are conveyed from CCJ to the
business and a solution is agreed upon
5. The BBB conveys the answer from the business to the
consumer
6. The transaction is performed between the consumer and
business based on the agreed solution

7. Number of Consumer Complaints Received by CCJ
The number of consumer complaints to CCJ increases year-over-year.
There are some months with an unusually large number of consultations and this is due to a large number of consultations* for a specific product or service.
Monthly average
369 (2014)
Monthly average
351 (2013)
Monthly average
166 (2012)
Specifically Example 6 and Example 7 in 4. Consultation Examples. (Page 30 – 31).

8. Type of Transaction
Almost all consultations are related to e-commerce.
The cross-border e-commerce market for consumers is estimated to continue increasing in the future* and this trend is forecast to continue.
Type of Transaction
No. of Cases
Share
E-commerce
10,576
97%
Local purchase
221 2%
Other
143 1%
Total
10,940
100%
(n=10,940)
According to the Ministry of Economy, Trade and Industry’s “FY2013 Report on the Foundation of an Information and Service Economic Society in Japan (Market Survey on E-Commerce)”, the size of the cross-border e-commerce consumer market among Japan, the United States and China will increase from 1.7 trillion yen (estimated) in 2013 to maximum 4.1 trillion yen in 2020.

9. Financial institution transfer
Payment Method
Credit card payments make up more than half of all payment methods.
Because fraudulent businesses prefer to receive payment through bank transfers, “financial institution transfers” also make up a large portion of payments.*
Payment Method
No. of Cases
Share
Credit card
5,366
49%
Financial institution transfer
4,755
43%
Payment agency
239 2%
Cash 73 1%
Other
281 3%
Unclear
226
Total
10,940
100%
(n=10,940)
Businesses must wait to receive payment in case of credit cards from the credit card company. On the other hand, businesses can receive payments from bank accounts immediately and this is why it is thought fraudulent businesses prefer “financial institution transfers”.

10. Imitation product delivered Merchandise not delivered
Type of Problem
A majority of problems involve fraudulent businesses (“imitation product delivered”* and “suspected fraud”).
Other problems include (contract termination (21%)” and “merchandise not delivered (13%)”).
Type of Problem
No. of cases
Share
Imitation product delivered
2,017
18%
Suspected fraud
3,608
33%
Merchandise not delivered
1,368
13%
Contract termination
2,284
21%
Unauthorized charges
399 4%
Returns
289 3%
Defective products
191 2%
Other
784 7%
Total
10,940
100%
(n=10,940)
“Suspected fraud” includes cases where even though consumers are able to confirm orders or payments, communication is cut off with the business without anything being delivered (or the business doesn’t respond in a reasonable way) and the consumers cannot accurately grasp the situation of the business. The meaning of “Imitation product delivered” can be taken broadly to mean fraudulent, but this has been differentiated in order to grasp the facts and trends of imitation products being delivered. “Merchandise not delivered” is used when the existence of the business can be confirmed and is different than “Suspected fraud”.

11. Country/Region of Business
The highest number of consultation of cases * concerned China at 38%.
Next was the United States at 29% and these two countries made up 70%
of all cases.
(n=7,603)
From the total number of 10,940 consultation cases, 3,184 cases which the business location was unknown and 153 cases which the business location was in Japan were excluded and a total of 7,603 cases was set as the parameter.

12. Efforts for Protecting Consumers from Problems (1)
Releasing regularly case examples based on consumer consultations to CCJ and providing tips to avoid problems related to cross-border transactions
Each case example shows useful advice and points to solve and prevent problems
Statistical data is used to easily explain trending problems

13. Efforts for Protecting Consumers from Problems (2)
Released a list of features of counterfeit selling websites for protecting consumers against them (February, 2013)
Has regularly released the names and URLs of overseas malicious websites
(280 as of the end of May, 2015)
(Example) Website confirmed to sell imitation products
(*) Information on the website is updated periodically.

14. Summary Operated more than three years
Total number of consultations since the establishment: more than 11,000
Accumulating know-how for handling consumer complaints related to cross-border transactions
Developing into a permanent entity and having more stable operations
Consumer issues with overseas shopping continue to increase in Japan
Hoping to expand cooperation relationship with overseas organizations