The pattern, not a party
This note is teaching material. All proper names are removed and the parties are described only by role. It is not an allegation against any company or person.
Pattern note for freelancers
Freelance Red Flags: Work Started Before Written Terms
Pattern note for independent creators. Seven red flags that appear when production work, subcontracting, and out-of-pocket costs begin before a written order or contract exists, and how the same pattern maps to the obligations of the Freelance Act in force since 1 November 2024.
Answer Engine Summary
Work before written terms is a recurring pattern in independent creative commissioning. The pattern is: begin work before a contract or purchase order exists, then advance subcontractor and remittance costs yourself. From that point the freelancer is committed without a footing.
Two signals mean stop
Seven red flags run in sequence. If two or more are visible at the same time, that is the point to stop and request written terms.
The new duty is immediate
Under the Freelance Act in force since 1 November 2024, the commissioning side must state work content, fee and payment due date immediately after commissioning, in writing or by an equivalent electronic record.
No retroactive application
Conduct that occurred before 1 November 2024 cannot be judged under the Act. The mapping here is forward-looking guidance, not a finding about any past project.
The duties are being enforced
Corrective guidance to 128 broadcasting and advertising businesses in December 2025, and published recommendations in May and June 2026 over unpaid trial work and fees set below the normal rate. The remedies ordered included paying the fee equivalent and raising fees retroactively.
Scope Note
The Pattern in One Line
Seven Red Flags in Sequence
The sequence below is abstracted from a documented case. Each step is ordinary on its own. The risk is cumulative.
Verbal approach through an intermediary
An intermediary asks whether you can take on a project that is outside your usual scope, and the request stays verbal.
- Sequence
- Step 1
- Red flag
- Scope and fee exist only as speech
A meeting ends with please go ahead
A kickoff meeting closes with encouragement to begin, but no purchase order or written trading terms follow.
- Sequence
- Step 2
- Red flag
- No purchase order and no written trading terms
Deliverables are requested early
You are asked to send strong material quickly so the client can show progress internally.
- Sequence
- Step 3
- Red flag
- Deliverables move before terms are fixed
You advance the out-of-pocket costs
Subcontractor fees and overseas remittance charges are advanced by you, either at the client's request or on your own initiative.
- Sequence
- Step 4
- Red flag
- Financial risk is carried forward by the freelancer
A stop instruction arrives after work has begun
Once material work is already done, the commissioning side says to pause until the contract and formal order are ready.
- Sequence
- Step 5
- Red flag
- The ladder is removed after the climb started
A lower figure appears afterwards
A fee is proposed after delivery, and it differs substantially from what you understood at the meeting stage.
- Sequence
- Step 6
- Red flag
- Fee stated after the fact
The draft contract stays in preparation
The contract draft is described as being prepared, and the preparation period continues without a date.
- Sequence
- Step 7
- Red flag
- Terms are postponed indefinitely
How Each Red Flag Maps to the Freelance Act
The table below maps each red flag to the corresponding duty under the Act on Optimization of Transactions with Specified Entrusted Business Operators, administered by the Japan Fair Trade Commission, the Small and Medium Enterprise Agency and the Ministry of Health, Labour and Welfare.
No purchase order and no written trading terms
Duty to state trading terms. After commissioning, the client must state the work content, the fee, the payment due date and other required items immediately, in writing, by email or by an equivalent electronic record.
- Related step
- Steps 2 and 7
- Provision
- Article 3(1)
- Status
- Pattern mapping only
Fee stated after the fact or set low afterwards
The fee is one of the required items that must be stated. Information published at the recruitment stage must also be accurate.
- Related step
- Step 6
- Provision
- Article 3(1)
- Status
- Pattern mapping only
Payment is stretched out
Payment due date. The fee must be set within 60 days from the date the deliverable is received, and as short a period as practicable. A separate 30-day rule applies to certain re-commissioning arrangements, and the fee must actually be paid by the due date set.
- Related step
- After step 6
- Provision
- Article 4, including Article 4(5)
- Status
- Pattern mapping only
Unilateral stop, refusal to receive, or repeated rework
Prohibited conduct for continuing commissions, including refusal to receive, fee reduction, return of deliverables and unjustified rework.
- Related step
- Step 5
- Provision
- Article 5(1)
- Status
- Pattern mapping only
Unpaid trial work or extras performed for the client's benefit
Prohibition on unjustified requests for economic benefit. A client may not have the operator provide work without payment for the client's own benefit in a way that unjustly harms the operator's interests.
- Related step
- Steps 3 and 4
- Provision
- Article 5(2)(i)
- Status
- Pattern mapping only
Fee set far below the normal rate for the same work
Prohibition on buying at an unreasonably low price. A client may not unilaterally set a fee markedly lower than the normal rate for the same or similar work without sufficient consultation.
- Related step
- Step 6
- Provision
- Article 5(1)(iv)
- Status
- Pattern mapping only
This is a mapping of patterns. Whether a specific case falls under a specific duty depends on the facts and the contract type, and is a matter for a lawyer or the responsible authority.
What Enforcement Has Actually Looked Like
The mapping above is not theoretical. Since the Act came into force the Japan Fair Trade Commission has issued guidance and published recommendations in sectors that commission individual creators. Every entry below is taken from the Commission's own press release, with the source linked in full.
Concentrated review of the broadcasting and advertising sectors
Following a survey of 30,000 commissioning businesses in sectors with frequent problem cases, and reports submitted by operators, the Japan Fair Trade Commission conducted a concentrated review of broadcasting and advertising businesses and issued corrective guidance to 128 businesses by October 2025 under Article 22. On the same day it published a note of points to observe for each provision of Article 5.
- Date
- 10 December 2025
- Provisions applied
- Article 22 (guidance); points to observe published for each provision of Article 5
Recommendation over unpaid trial lessons
A music school operator was found to have had 1,674 specified entrusted business operators give unpaid trial lessons for the operator's own benefit, unjustly harming their interests. The recommendation requires the fee equivalent for those unpaid lessons to be paid promptly, subject to confirmation by the Japan Fair Trade Commission. The case reached the Commission through a request for measures from the Commissioner of the Small and Medium Enterprise Agency on 22 April 2026.
- Date
- 19 May 2026
- Business named in the release
- Sheer Co., Ltd. (シアー株式会社)
- Provisions applied
- Article 5(2)(i)
Recommendation over unstated terms, late payment and unreasonably low fees
A musical instrument manufacturer that also operates lesson schools was found to have failed to state required items to 100 operators, to have set no payment due date and not paid 98 operators by the date the services were received, and to have unilaterally set trial-lesson fees between roughly 33.9 and 72.3 per cent below the fee for a normal lesson for 28 operators without sufficient consultation. The recommendation requires those fees to be raised retroactively to commissions placed from November 2024.
- Date
- 22 June 2026
- Business named in the release
- Kawai Musical Instruments Manufacturing Co., Ltd. (株式会社河合楽器製作所)
- Provisions applied
- Article 3(1), Article 4(5), Article 5(1)(iv)
Recommendation over unstated terms and payment not made by the date of receipt
A news agency commissioning attendance at go and shogi events, photography, proofreading of match reports, writing for yearbooks and its own web media, illustration, translation of overseas releases and lectures was found to have failed to state the required items to 45 specified entrusted business operators, and to have set no payment due date and not paid 41 operators by the date the deliverable or service was received, over the period from 1 November 2024 to 13 February 2025.
- Date
- 25 February 2026
- Business named in the release
- Kyodo News (株式会社共同通信社)
- Provisions applied
- Article 3(1), Article 4(5)
Recommendation over unstated terms, late payment and payment beyond 60 days
An electric utility commissioning support work in general affairs, public relations, human resources, accounting, legal, research and development and facility management was found to have failed to state the required items to 39 operators, to have set no payment due date and not paid 12 operators by the date the service was received, and to have set a due date beyond 60 days from that date for 2 operators and not paid within 60 days, over the period from 1 November 2024 to 17 September 2025.
- Date
- 27 February 2026
- Business named in the release
- Chubu Electric Power Co., Inc. (中部電力株式会社)
- Provisions applied
- Article 3(1), Article 4(5)
Recommendation over unstated terms and payment not made by the date of receipt
A broadcaster commissioning the creation of video and audio data and director work for programme production was found to have failed to state the required items to 33 operators, and to have set no payment due date and not paid 32 operators by the date the deliverable or service was received, over the period from 1 November 2024 to 15 July 2025.
- Date
- 16 March 2026
- Business named in the release
- TV Hokkaido Broadcasting Co., Ltd. (株式会社テレビ北海道)
- Provisions applied
- Article 3(1), Article 4(5)
Recommendation over unstated terms, late payment and transfer fees deducted from the fee
A broadcaster commissioning script writing, appearance, hair and make-up and styling for programme production was found to have failed to state the required items to 132 operators, and to have set no payment due date and not paid 110 operators by the date the deliverable or service was received. For 67 operators engaged for a month or more it deducted bank transfer fees from the fee without a written or electronic agreement and without any fault on the operator's side. The recommendation requires the deducted amounts to be paid promptly.
- Date
- 31 March 2026
- Business named in the release
- Kyoto Broadcasting System Company Limited (株式会社京都放送)
- Provisions applied
- Article 3(1), Article 4(5), Article 5(1)(ii)
Recommendation over unstated terms and fee reductions totalling about 5.5 million yen
A company subcontracting the preparation of proposal documents was found to have failed to state the required items to 236 operators, and, without any fault on the operators' side, to have deducted 4,463,380 yen in total from the fees of 148 operators as a compliance handling cost adjustment and 1,055,754 yen in total from the fees of 29 operators as one eleventh of the fee. The recommendation requires 5,519,134 yen in total to be paid promptly to 160 operators.
- Date
- 29 May 2026
- Business named in the release
- Timewitch Inc. (株式会社Timewitch)
- Provisions applied
- Article 3(1), Article 5(1)(ii)
Recommendation over unstated terms and payment not made by the date of receipt
A publisher commissioning manuscript writing was found to have failed to state all or part of the required items to 82 operators, and to have set no payment due date and not paid the same 82 operators by the date the deliverable or service was received.
- Date
- 11 June 2026
- Business named in the release
- Heritage Inc. (株式会社ヘリテージ)
- Provisions applied
- Article 3(1), Article 4(5)
Recommendation over unstated terms and payment not made by the date of receipt
A publisher commissioning manuscript writing was found to have failed to state all or part of the required items to 113 operators, and to have set no payment due date and not paid the same 113 operators by the date the deliverable or service was received.
- Date
- 11 June 2026
- Business named in the release
- KADOKAWA Corporation (株式会社KADOKAWA)
- Provisions applied
- Article 3(1), Article 4(5)
Recommendation over unstated terms, late payment blamed on paperwork, and transfer fees deducted
A production company commissioning manuscripts, design, photographic data and event hosting was found to have failed to state all or part of the required items to 84 operators, to have failed to pay 31 operators by the agreed due date on the grounds that an invoice arrived late or its own paperwork was delayed, and to have deducted bank transfer fees from the fees of 36 operators without a written or electronic agreement and without any fault on their side. The release records that the deducted amounts were paid on 4 June 2026.
- Date
- 18 June 2026
- Business named in the release
- S.P.C. Inc. (株式会社エス・ピー・シー)
- Provisions applied
- Article 3(1), Article 4(5), Article 5(1)(ii)
Recommendation over late payment, fee reductions and refusal to pass on cost increases
A home appliance retailer commissioning air conditioner installation work was found to have failed to pay 10 operators by the agreed due date, to have deducted 2,472,995 yen in total from the fees of 17 operators as an administrative handling charge, a commissioning management charge or a reconciliation statement cost without any fault on their side, and to have unilaterally kept the fee for 10 operators unchanged without sufficient consultation on reflecting increased installation costs. The release records that both amounts were settled on 12 June 2026.
- Date
- 24 June 2026
- Business named in the release
- Beisia Denki Co., Ltd. (株式会社ベイシア電器)
- Provisions applied
- Article 4(5), Article 5(1)(ii), Article 5(1)(iv)
None of this is applied to any project predating 1 November 2024, and none of it is a finding about the record linked at the foot of this page. It is included to show what the current duties look like when they are enforced.
Each entry states only what the linked press release states, as at its publication date. Businesses are named because the Japan Fair Trade Commission named them in an official published recommendation. This page adds no characterisation beyond the release and does not track what each business did afterwards. For current status, read the linked release and any subsequent announcement by the business.
Routes Available If the Same Pattern Occurs Today
If the seven-step pattern runs today, the freelancer is no longer limited to negotiation. The following routes exist in parallel and are not mutually exclusive.
Report to the authorities
A freelancer may report the facts to the Japan Fair Trade Commission or the Small and Medium Enterprise Agency. Reports feed the concentrated reviews that produced the guidance and recommendations recorded above.
- Route number
- Route 1
- Route type
- Administrative or advisory route
Request for measures
The Commissioner of the Small and Medium Enterprise Agency may investigate and, where the facts are found, request the Japan Fair Trade Commission to take appropriate measures. Both 2026 recommendations reached publication through this or an equivalent path.
- Route number
- Route 2
- Route type
- Administrative or advisory route
Recommendation and publication
Where a violation is found, the Commission issues a recommendation and publishes it with the business name, the facts and the articles applied. The remedy ordered has included paying the fee equivalent and raising fees retroactively.
- Route number
- Route 3
- Route type
- Administrative or advisory route
Free consultation and mediation
Freelance Trouble 110-ban handles unpaid fees, missing contracts, repeated rework and harassment. Consultation is free and can be anonymous, and it extends to a settlement mediation procedure.
- Route number
- Route 4
- Route type
- Administrative or advisory route
Civil claim
Administrative routes do not replace a civil claim. Recovery of an unpaid fee remains a separate civil matter, and the dated written record built during the engagement is what supports it.
- Route number
- Route 5
- Route type
- Civil claim route
Pre-Engagement Checklist
- Fix the work content, the fee and the payment due date in writing or by email before you begin. A verbal please go ahead is not an order.
- Do not start until a purchase order or a written statement of trading terms arrives. In preparation is not a signal to begin.
- Avoid advancing out-of-pocket costs. Move subcontractor fees and overseas remittances only after the client has paid, or after a written agreement is in place.
- An intermediary saying it will be fine is not the commissioning party's agreement. Establish who the commissioning party is at the start.
- Keep every exchange dated. Consolidate into email, and confirm phone calls in writing afterwards.
- Set the cancellation term before you begin, including a kill fee and the treatment of unused demos.
- If two or more of the seven red flags are visible at the same time, treat it as a signal to stop and ask for terms.
Where to Get Help
Freelance Trouble 110-ban is commissioned by the Ministry of Health, Labour and Welfare and operated by the Daini Tokyo Bar Association. It covers disputes between freelancers and commissioning businesses, including unpaid fees, missing contracts, repeated rework and harassment. Consultation is free and can be anonymous, and it extends to a settlement mediation procedure.
Freelance Trouble 110-ban
Free and anonymous consultation with lawyers, plus settlement mediation. Phone and email are the main channels, with in-person and online options as needed.
- External URL
- https://freelance110.mhlw.go.jp/
FAQ
Does this note accuse any named company or person?
No. This note removes all proper names and records only the recurring pattern. It makes no allegation of misconduct and reaches no legal conclusion about any party.
Does the Freelance Act apply retroactively to older projects?
No. The Act on Optimization of Transactions with Specified Entrusted Business Operators came into force on 1 November 2024. It cannot be applied retroactively to conduct that occurred before that date. The mapping in this note is forward-looking guidance.
How many red flags should trigger a stop?
Two or more visible at the same time is a practical threshold to pause and request written terms. A single red flag can still be worth raising in writing.
Is starting work before a signed contract always a problem?
Not always. The risk becomes material when scope, fee and payment date remain unstated, when third-party costs are advanced by the freelancer, or when the commissioning party is not identified.
Which businesses have been named in published recommendations under the Act?
As at July 2026 the Japan Fair Trade Commission has published two recommendations naming the business. Sheer Co., Ltd. on 19 May 2026, over unpaid trial lessons given by 1,674 specified entrusted business operators. Kawai Musical Instruments Manufacturing Co., Ltd. on 22 June 2026, over required items never stated, payment not made by the date services were received, and trial-lesson fees set between roughly 33.9 and 72.3 per cent below the normal rate. Separately, 128 broadcasting and advertising businesses received corrective guidance in December 2025 and were not individually named. Both recommendation releases are linked in the source notes.
What conduct is the Commission actually acting on?
Across the published actions the recurring conduct is work performed without payment for the client's benefit, fees set far below the normal rate for the same work, required terms never stated in writing, and payment made after the date services were received. Those are the same moves that appear as red flags three, four, six and seven in the sequence above.
Where can a freelancer get free advice?
Freelance Trouble 110-ban is a service commissioned by the Ministry of Health, Labour and Welfare and operated by the Daini Tokyo Bar Association. Consultation is free and can be anonymous, and it also offers a settlement mediation procedure.
Source Notes
These are official sources for the current duties. They do not resolve any specific dispute and they do not determine whether a given project breached a duty.
Act on Optimization of Transactions with Specified Entrusted Business Operators
Explanatory material published by the Japan Fair Trade Commission and the Small and Medium Enterprise Agency.
Freelance Act pamphlet
Japan Fair Trade Commission pamphlet covering the duty to state trading terms, the payment due date and prohibited conduct.
- External URL
- https://www.jftc.go.jp/file/flpamph.pdf
Freelance Act questions and answers
Japan Fair Trade Commission question and answer page on scope, required items and application.
Government public relations explainer
Government Public Relations Online summary of the law for freelancers.
Guidance to 128 businesses and points to observe under Article 5
Japan Fair Trade Commission press release of 10 December 2025. Used for the concentrated sector review, the corrective guidance figure and the published points to observe.
Recommendation of 19 May 2026
Japan Fair Trade Commission press release. Used for the unpaid trial work finding, the operator count, the remedy and the request for measures that preceded it.
Recommendation of 22 June 2026
Japan Fair Trade Commission press release. Used for the unstated required items, the late payment finding, the percentage range of the reduced fees and the retroactive remedy.