Kadokawa Faces Japan FTC Recommendation Over Suspected Freelance Payment Contract Violations

If you work freelance (writing, illustration, styling, editing), you already know how quickly a job can move from “we need it asap” to “we’ll confirm the payment date later,” and that gap—small on paper, huge in real life—is exactly what Japan’s regulators are now looking at in a case involving Kadokawa.

What regulators are looking into

Japan’s Japan Fair Trade Commission is reportedly preparing a recommendation to Kadokawa over suspected violations tied to the Act on Ensuring Proper Transactions Involving Specified Entrusted Business Operators, a law that many people also call the Freelancers Protection Act or simply the Freelance Act.

The suspected issue centers on how contracts were handled for work on some magazines, affecting about 100 freelance contractors (including writers, stylists, and illustrators). The key point is that, since the winter of 2024, the contracts allegedly did not include a payment time window, and this appears linked to an internal custom of placing freelancer orders verbally rather than through written terms that clearly lock in timelines.

The two main red flags

• Missing payment timing in contracts for a significant group of freelancers.
• Late payments to freelancers in certain cases.

Why the payment date detail matters under the Freelance Act

Under Article 4.2 of the Freelance Act, if a freelance contract does not explicitly state a payment date, then the payment must be made on the same day the work is delivered to the contracting company; in practice, that makes “we’ll pay you later” a risky gray zone when the date isn’t written down.

Have you ever delivered a final file and then had to ask, in a separate message, “What day will the transfer be made?” If your answer is yes, you can map that experience to what regulators are trying to prevent: unclear terms that leave you exposed when cashflow matters, ya pues.

Kadokawa’s response and the broader legal context

Kadokawa has stated that it acknowledges it is under investigation and that it is responding seriously. The Freelance Act itself was enacted in April 2023, promulgated in May 2023, and took effect in November 2024; before that, another framework commonly referenced for protections was the Act against Delay in Payment of Subcontract Proceeds, etc. to Subcontractors, often called the Subcontract Act.

Separately, Japan’s FTC had already issued a warning in November 2024 involving Kadokawa and its subsidiary Kadokawa LifeDesign regarding reducing payments to freelancers in violation of the law.

From my own experience helping teams keep agreements tidy—especially when projects move fast and everyone wants things “para ayer”—the practical takeaway is simple and very bacán when you apply it: put the payment date (or payment window) in writing, confirm delivery terms, and keep a paper trail that you can actually show if things get messy.

Call to action: If you freelance, review your last three agreements today and check for payment date, delivery definition, and late-payment handling; if you hire freelancers, standardize written orders so your process doesn’t depend on memory or verbal “okays,” boludo.