Case Study: Import JCT Recovery for a Foreign B2C Seller Using the ACP Scheme
Background
Company C, a foreign B2C seller, had operated an online sales model for many years, selling products directly to consumers in Japan through its own overseas website.
Once a Japanese consumer placed an order, the relevant parcel was shipped individually from an overseas factory or warehouse in Hong Kong to Japan under DDP terms. Under the original import arrangement, each Japanese consumer was recorded as the importer of record for customs purposes.
Although the Japanese consumers appeared as the importers on the import permits, Company C economically bore the import consumption tax because the goods were shipped on a DDP basis.
Company C was also filing Japanese Consumption Tax returns with the Japanese tax office and paying Japanese Consumption Tax on its sales to Japanese consumers.
This structure caused a significant tax inefficiency.
Under the Japanese Consumption Tax system, a taxable business may generally deduct input consumption tax incurred on purchases and imports from output consumption tax on sales. Import consumption tax may also be eligible for input tax credit. In practice, however, the claimant must be the importer of record shown on the import permit.
In Company C’s case, the import permits named the individual Japanese consumers as the importers, not Company C. Therefore, even though Company C had economically paid the import consumption tax under the DDP arrangement, it was unable to claim input tax credit for that import consumption tax.
As a result, Company C faced tax leakage in the following way:
Company C paid output consumption tax on its sales to Japanese consumers through its Japanese Consumption Tax filings.
At the same time, Company C had already borne import consumption tax when the goods were imported into Japan under DDP terms.
However, because Company C was not shown as the importer of record, the import consumption tax could not be credited or recovered through its Japanese Consumption Tax return.
Consequently, the import consumption tax remained an unrecoverable cost, creating a substantial tax burden for Company C.
Solution Using the ACP Scheme
To address this issue, Company C appointed ACP Japan as its Attorney for Customs Procedures under the ACP scheme.
This allowed Company C to import the goods into Japan in its own name. After the ACP arrangement was implemented, the import permits showed Company C as the importer of record.
As a result, Company C was able to start claiming input tax credit for the import consumption tax through its Japanese Consumption Tax filings. Import JCT that had previously been treated as an unrecoverable cost became recoverable under the revised structure.
A key point in this case is that a sales transaction concluded through an overseas website does not automatically mean that the Japanese consumer must always be the importer of record. Where the foreign seller retains the right of disposal, or ownership of the goods, during the import process, the foreign seller may also be able to act as the importer of record in Japan.
In addition, appointing an Attorney for Customs Procedures (ACP) allows the foreign corporation, Company C, to be treated as the single importer for customs purposes. This can greatly reduce the practical workload for customs brokers.
Without this structure, customs brokers may need to handle a large number of individual consumers as importers. If any importer-related confirmation or communication is required during customs clearance, they may have to contact each consumer separately, resulting in a considerable administrative burden.
Under the ACP structure, however, Company C is treated as the unified importer, and customs brokers can communicate directly with the ACP as Company C’s representative. This creates a single point of contact for importer-related matters and significantly improves operational efficiency for customs brokers.
Practical Benefit of the ACP Scheme
Recovery of Import JCT (Japan Consumption Tax)
This case demonstrates a practical benefit of the ACP scheme for foreign sellers engaged in B2C sales to Japanese consumers.
Many overseas sellers use DDP shipping when selling goods into Japan and, as a commercial matter, bear Japanese import consumption tax. However, if the seller is not named as the importer of record on the import permit, it may not be able to claim input tax credit or a refund for the import consumption tax, even if it has economically borne that cost.
This issue can become particularly important where the foreign seller is also filing Japanese Consumption Tax returns and paying output consumption tax on sales to Japanese customers. In such cases, unrecoverable import consumption tax may directly reduce the profitability of the Japanese business.
By appointing an ACP and importing goods into Japan under the foreign seller’s own name, the seller can create the basis to claim input tax credit or a refund for import consumption tax, subject to the applicable Japanese Consumption Tax requirements.
For foreign businesses selling to Japanese consumers through their own website or other B2C channels, the ACP scheme can therefore be more than a customs administration tool. If structured properly, it may become an important part of the seller’s Japanese tax and business strategy.
Reducing Customs Clearance Workload and Improving Efficiency for Customs Brokers
The ACP system offers important practical benefits not only for foreign sellers, but also for customs brokers handling import clearance in Japan.
In cross-border B2C sales, foreign sellers often ship a large number of parcels directly to individual consumers across Japan. If each consumer is treated as the importer, customs brokers may need to contact each individual consignee whenever importer-related questions or confirmations arise during the customs clearance process. This can result in a substantial administrative burden.
By appointing an ACP, the foreign seller, Company C, can be treated as the unified importer for customs purposes. In this structure, customs brokers can communicate with the ACP as the representative of Company C, rather than contacting numerous individual consumers separately.
This provides a centralized point of contact for importer-related matters and helps customs brokers manage clearance procedures more efficiently. As a result, the ACP system can streamline customs operations, reduce administrative workload, and support smoother import clearance for all parties involved.
Our ACP Service: The Best Solution for the Japan Importer of Record (IOR) and Exporter of Record (EOR)
ACP is an effective solution for addressing Importer of Record (IOR) and Exporter of Record (EOR) requirements in Japan. Through our ACP service, non-resident entities located outside Japan are able to import and export goods as Non-Resident IOR and EOR.
Below is an overview of our basic scope of work, together with a diagram illustrating the operational structure of the ACP service. Once ACP registration is completed, the non-resident entity can act as the Importer of Record (IOR) and Exporter of Record (EOR) in Japan.
Scope of Work – How We Can Assist
- Preparation and filing of all required documents for ACP registration with Japan Customs.
- Coordination and communication with relevant stakeholders, including Japan Customs, logistics providers, and customs brokers to ensure the smooth and compliant import and export procedures.
- Preparation and review of import documentation, including commercial invoices and shipping documents. *Proper customs clearance requires accurate identification and statement of the shipper, consignee / Exporter of Record (EOR), and Importer of Record (IOR) on B/L, AWB, and Commercial Invoice. We provide practical guidance on correct documentation practices. We also advise on customs valuation (import declaration value) and its supporting documentation, HS classification, and country of origin to ensure compliance with Japanese customs requirements.
- Advisory on customs valuation (import declaration value), HS codes, duty rates, and origin (including advance rulings).
- Import compliance support for regulated products, including Domestic Administrator (sometimes referred to as “Domestic Representative”) Services under the Product Safety Acts (PSE/PSC) and food-related products regulated under the Food Sanitation Act.
- Support for security export control, including list-based classification, catch-all control assessment, and assistance with export license applications to the Ministry of Economy, Trade and Industry (METI).
- Maintenance and retention of records required under the Japan Customs Law.
- Provision of professional trade and customs advisory services to address and resolve issues that may arise during import or export operations.
**Both import and export activities can benefit from the use of an ACP (Attorney for Customs Procedures). This support is applicable in scenarios where a non-resident acts as the Importer of Record (IOR) for imports and as the Exporter of Record (EOR) for exports.
Three Steps to Initiate Shipments Under the ACP Program:
- Quotation Review to Contract Conclusion: Upon receiving your contact details, we will promptly provide a quotation for your review.
- Commencing the Registration of ACP (Attorney for Customs Procedures) to Japan Customs: This process is generally completed in about two weeks.
- Initiation of First Shipment, Import/Export
Track Record – Attorney for Customs Procedures (ACP) Services
We have supported import and export operations in Japan for over 300 clients across more than 40 countries. 
Why choose us?
We specialize in navigating complex issues at the intersection of customs procedures and taxation—an area where our ability to offer practical, comprehensive support from both perspectives sets us apart. Understanding the close relationship between customs duties and national taxes (especially, Japan Consumption Tax – JCT), and addressing both in an integrated manner, is crucial in the context of international trade.
- Customs and International Trade Professionals – Led by our CEO, Mr. Sawada—Certified Customs Specialist and former KPMG professional—ACP JAPAN provides expert-level support in Customs and international trade. Mr. Sawada also serves as an external expert for the World Bank’s B-READY project in the field of customs and international trade.
- Full Compliance with Japanese Customs Law – We ensure full adherence to Japanese Customs Law, including Importer of Record (IOR) structure, HS code classification, and customs valuation. We assist in preparing all essential shipping documents for non-resident entities.
- One-Stop Support for ACP and JCT Tax Representative Services – In collaboration with trusted partner tax accountants, we provide comprehensive support for both customs procedures through the Attorney for Customs Procedures (ACP) and Japan Consumption Tax (JCT) filings through the JCT Tax Representative.
- Multilingual Communication – Our team communicates fluently in English, Japanese, and Chinese, offering smooth coordination with global clients and authorities in Japan.
- Support for Regulated Products – Our ACP/IOR partnership system can manage regulated items, including cosmetics, PSE-products, foodstuffs, and tableware.
- Trusted by Global Clients – Serving around 100 ACP clients annually, including many Amazon sellers, we’re a certified provider on Amazon SPN (Service Provider Network) under Trade Compliance.
FAQ for ACP (Attorney for Customs Procedures)
What is the role of ACP (ACP Japan)?
- Representation: ACP (ACP Japan) represents the foreign importer and liaises with Japan Customs and the Forwarding Company/Customs Broker.
- Documentation and Compliance: ACP assists in preparing essential import documents (e.g., Invoices) in compliance with Japan Customs Law and formally requests the Customs Broker to proceed with customs clearance.
- Expert Consultation and Troubleshooting: We are a team of legal experts in Customs Laws, providing direct consultations with Japan Customs to ensure compliance and address issues, including troubleshooting unique challenges in non-resident imports.
How long time does it require to get ACP’s registration?
It will take approximately 2 weeks until getting an approval from Japan Customs Office. The breakdown of the task is as follows.
- Prepare the necessary documentation between us
- Start pre-consultation with Japan Customs Office and proceed initial review
- Submit paper-based set of application documents to Japan Customs Office for final review
What kind of documents to be necessary for ACP application?
Not limited, but for instance – Power of Attorney, Company Registry, The calculation method of Customs Valuation, Catalog of the import goods, business/logistic flow
ACP can handle all kinds of goods?
Whereas many ACP service providers do not handle regulated items, our company’s competitive advantage stems from our ability to manage such products. We can support regulated items, including cosmetics, PSE-regulated products, foodstuffs, and tableware.
Which regions in Japan are we covering?
Any region in Japan, we can handle.
What is difference between ACP and IOR?
ACP is not the Importer. ACP enables non-resident entities to become IOR (Importer of Record).