Governments Going Circular – Global Scan Best Practices
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0 % read case Law for Promotion of Effective Utilization of Resources Japan

Policy areas

Resources Resources

Govermental instruments

Laws & Regulation Laws & Regulation
Public Procurement Public Procurement
Subsidies Subsidies

Business models

Resource Loops Resource Loops
Product Life Extension Product Life Extension
Circular Design Circular Design


National National
Local Local

Key facts & Impacts

  • Japan’s recycling rate for metal is 98%
  • Up to 89% of the materials in e-waste is recycled


To promote the reduction of waste generation, reuse of parts, and recycling of used products as raw materials


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Law for Promotion of Effective Utilization of Resources Japan Japan.png

Japan has always been highly dependent on natural resource imports for industrial raw material inputs. In order to optimise material use, and thus decrease import dependency, the Law for Promotion of Effective Utilization of Resources promotes the 3 ‘Rs’: Reduce, Reuse, and Recycle. It encourages the utilisation of recyclable resources, reusable materials and product parts at the producer level.

What does it involve?
The law forms a legal framework covering the entire life span of products from the plastic, electronics, paper, packaging, automobile and raw material processing industries, both upstream and downstream. It sets standards for producers in terms of the generation of by-products and under this law, producers are obliged to use specified amounts of recycled resources and reusable parts in the production of new products. Violators of these standards, following a first public warning, may incur a financial penalty. The national government, however, is responsible for facilitating the enforcement of the law by funding necessary implementation measures and by providing subsidies to private business operators. Additionally, the government promotes research and development activities, implements educational and publicity programmes, and uses their procurement power to stimulate the use of recyclable resources and reusable parts. In addition to the national law, local governments are also required to promote and implement the law in accordance with local situations.

Status quo
In 2000, the law was introduced as a result of the reform of the Law for Promotion of Utilization of Recyclable Resources (1991). Together with a major waste management law, it forms an integral part of the Japanese Basic Act on Establishing a Sound Material-Cycle Society, which also dates from 2000. In the first five years, local governments were able to receive an interest-free loan from the national government for their supporting activities and subsidies. Nowadays, producers are required, where applicable, to: reuse waste products; reduce the volume of discarded end-of-life products; design products that are easily recyclable; ‘voluntarily’ take-back products at their end-of-life; and recycle by-products to produce construction materials. The long history of waste and resource efficiency policies has made Japan a pioneering country with a high rate of circular loops.

Japan has a long history in resource- and waste-focussed policies due to rapid population growth and industrialisation on a comparatively limited landmass. Sourcing landfill disposal sites in Japan is therefore a difficult process. This prompted the country to deploy a system that maximised reuse and recycling. Japan not only lacks room for disposal sites due to a dense population, it also lacks natural resources and is therefore highly reliant on imports. The sound development of the national economy is therefore strongly dependent on a system built around material imports. 

Circular ladder

This Circularity Ladder presents economic activities with an increasing ‘degree of circularity’. When looking at the six circular business models we see two important things. First, some business models are able to achieve a higher degree of circularity than others. For example, a Sharing Platform does not directly lead to refurbishment (it is possible), but Product Life Extension does.

Second, all business models fall apart in different activities, of which again some activities are able to achieve higher degrees of circularity than others. For example, the Product Life Extension may involve maintenance, repair, reuse, refurbishment and remanufacturing. However, maintaining a product has more potential for resource efficiency than remanufacturing.