Gambling in Japan occupies a uniquely complex space in the nation’s legal and cultural landscape. On one hand, Japan has innumerable pachinko parlours (slot machines), state-run lotteries and popular betting markets for horse racing and motor sports. They earn billions of yen every year and are integrated into everyday leisure. On the other hand, Japan’s Penal Code specifically bans most gambling activities, and until quite recently, discussion of a legal casino within the nation’s borders was laughable.
This paradox is a product of laws that allowed carefully regulated exceptions to the ban. Over time, these exceptions have created a patchwork that permits state-sanctioned betting but prohibits almost all unlicensed or non-state platforms offering games of chance.
In 2018, the state officially authorized land-based casinos in the form of Integrated Resort (IR) legislation, a historic moment for Japan. However, it came with the condition that these casinos need to be attached to a resort and must be regulated. Even with this legislation, Japan maintains its stiff resistance to online casinos, carefully loosening its previous stance pertaining to gambling in general.
With Japan’s first resort casino scheduled to open in Osaka by 2030, questions about balancing economic development, social responsibility and legal clarity have intensified.
Gambling as a Crime with Focused Exemptions
Japan’s principle is simple. Gambling is a criminal offence under the penal code. Under Article 185, simple gambling is punishable. Similarly, Article 186 imposes stricter punishments on habitual gambling and gambling houses. These two provisions are the foundation of Japan’s historical prohibitionist stance.
Japan has developed a set of limited exceptions to the default gambling ban. They include licensed public sports betting (horse racing and some motor sports), government-run lotteries, football pools (toto), the extensive but legally defined world of pachinko, and, more recently, an avenue toward tightly regulated, land-based casinos in “integrated resorts” (IRs). Each exception has its own legal authority comes with its own set of regulatory and compliance obligations.
Most of the gambling activities are illegal unless a particular law allows for a defined form of legal gambling. That is also the explanation for why Japan has not legalized online casinos. The IR legislation only allows for strictly site-based casino gambling (not online gambling) within strictly confined premises.
Japan’s Core Criminal Laws (Penal Code)
The Japanese Penal Code (Keiho) is the foundational legislation that defines general provisions for crimes and punishment. It is one of the six core components of Japan’s legal code. Chapter XXIII consists of crimes related to gambling.
Article 185 (Gambling)
A person who gambles is punished by a fine of not more than 500,000 yen or a petty fine; provided, however, that the same does not apply to a person who gambles occasionally, provided for recreational amusement.
Article 186 (Habitual Gambling; Running a Gambling Place for the Purpose of Gain)
(1) A person who habitually gambles is punished by imprisonment for not more than 3 years.
(2) A person who, for the purpose of profit, runs a place for gambling or organizes a group of habitual gamblers is punished by imprisonment for not less than 3 months but not more than 5 years.
Article 187 (Sale of Lotteries)
(1) A person who sells a lottery ticket is punished by imprisonment for not more than 2 years or a fine of not more than 1,500,000 yen.
(2) A person who acts as an intermediary in the sale of a lottery ticket is punished by imprisonment for not more than 1 year or a fine of not more than 1,000,000 yen.
(3) Beyond what is provided for in the preceding two paragraphs, a person who delivers or receives a lottery ticket is punished by a fine of not more than 200,000 yen or a petty fine
These statutes are very broadly drafted, with many decades of enforcement used against informal or unlicensed gaming and cooperation with other special statutes that allow a narrow list of exceptions. The official English translations are published by the Ministry of Justice’s Japanese Law Translation.
Authorized Exceptions
Sports Betting Managed by the Public
In Japan, wagering is permitted on a limited selection of “public sports” (kōei kyōgi), which are:
– Horse racing (keiba)
– Bicycle racing (keirin),
– Powerboat racing (kyōtei)
– Motorcycle speedway (auto race)
These activities occur under unique legislation intended primarily for the purpose of generating public revenue while controlling gambling interest into regulated and publicly auditable operations. An overview by the government provides a comparison of bicycle, horse, powerboat, and motorcycle racing and explains how these events fall outside the bounds of the Penal Code due to the additional public-interest laws and operators.
Bets are made by authorized operators (for example, JRA horse racing) from authorized locations on-site at the racing venue, off-site at approved racetracks or physical betting retail centres, or on the authorized website and not through offshore licensed bookmakers.
There is some regulatory emphasis placed on payout and “takeout rates,” which can fluctuate by horse racing operators in Japan.
Government Lotteries and Football Pools
Japan’s public lotteries (takarakuji) and football pools (toto) are permitted by laws specifically designed to create revenue for national and local government operations. The Penal Code also makes it a separate crime to participate in an unregulated lottery, which is why you will only see tickets offered from public sources or licensed vendors.
Pachinko: A “Prize-Exchange” System to Avoid a Cash-for-Chips Industry Model
Pachinko parlours are found on nearly every street in Japan. However, they are not considered gambling houses according to the law. The legal framework that allows pachinko to exist is peculiar. Players win prizes instead of cash on-site. One of the prizes can be taken off-site (a “special prize”), and then redeemed in cash at another business nearby, which will then resell the special prize. This process sets up a three-step loop to still reward players while avoiding a cash or cash-like payment. In this way, the legal distinction from “gambling” under the Penal Code is preserved.
Practical Implications:
- Pachinko parlours are primarily regulated under the Amusement Business Act and police oversight, not under the casino framework.
- Online pachinko/pachi-slot is not regulated or allowed to occur; offering it on the internet would fit under the definition of gambling per the Penal Code.
Integrated Resort (IR) and Casino Legislation
Two-Step Legalization
In July 2018, Japan initiated the Act to Implement Specified Integrated Resort Areas (known as the “Casino Implementation Act” or IR Implementation Act), creating a legal pathway for a limited number of land-based casinos inside larger destination resorts. The Act describes “casino gaming”, establishes licensing categories and builds a compliance perimeter that anticipates anti-addiction measures and regulatory scrutiny.
Constitutional policy notes and practitioner analyses published around the 2018–2021 rollout highlight that the IR laws do not legalize online casinos. They permit casino gaming only on the gaming floors of approved resorts located within designated IR areas.
In April 2023, national officials reported renewed signs of momentum for filling the other two IR licenses, with news articles in 2025 describing potential windows for licensure application as well as targets for approval by 2027.
Who Oversees Regulatory Activities?
In January 2020, Japan established the Casino Regulatory Commission (JCRC) as an external bureau to the Cabinet Office with the responsibility for licensing, regulation, and enforcement of the casino regime. The Commission produces rules, conducts suitability assessments and maintains oversight for ongoing compliance with rules.
How Many and Where?
Under the national policy for IRs, there can be up to three IRs authorized in Japan. As of 2022, only Osaka has been approved at the national level and is already in the construction phase. This government approval was delivered in April 2023, and updates since have suggested a 2030 opening, which had originally been reported as 2029.
The Osaka IR, which is being jointly developed in a partnership between MGM Resorts and Orix on Yumeshima Island, had a groundbreaking ceremony in April 2025 and is widely reported to be aiming for a late opening in 2030. As reported in the news, the project cost is now in the ¥1.27 trillion range.
Economic Justifications
As a tourism-centric model, Japan’s IR concept – while supporting many elements as part of its resort “tool kit” (i.e., hotels, MICE, recreation, retail, culture) are being framed and described by government and corporate types as catalysts for inbound travel, and regional development, thereby establishing the rationale for limited sites, heavy compliance and public benefit frames as in other areas of public sport and lotteries.
Online Gambling: The Definitive Position in 2025
Japan’s position in 2025 continues to be clear. Online gambling (including online casinos) is considered illegal under Japanese law, even while the country has continued its efforts to develop land-based IRs. Practice guides and legal commentaries from 2024 had already established that the Penal Code prohibits online gaming activities, which are not legalized under the IR laws.
In September 2025, major Japanese media reported on authorities taking an enhanced enforcement approach with respect to online gambling advertising and indicated that it may be illegal to even promote online casinos and encourage their use online. The gaming industry press observed the move as part of a broader government anti-addiction and consumer-protection initiative.
Compliance Architecture and Player Protections
Anti-Addiction and Responsible Gaming
The IR system was deliberately developed with respect to problematic gambling as a focal point due to domestic political reasons. The framework includes controls at the entrance, potential limits on entry for residents and strict solicitation/advertising and promotion. The principles set out in the code of conduct for IRs and other Cabinet Office policies refer to integrity and suitability with safeguards for society. There will likely be much more detail before final regulations are developed and approved, but the ongoing public message is clear: casinos are to operate as closely regulated entertainment venues, rather than casinos as unbounded liberties for gambling in open/controlled environments.
AML/CFT Controls
Casinos within IRs will need to follow know-your-customer (KYC), anti-money-laundering (AML), and counter-terrorist financing (CFT) obligations, even with ongoing reporting to law enforcement. There are official practitioner guides that will guide their ongoing reporting responsibilities, site supervision and periodic reporting, although no timelines are defined for these. In fact, the licensee would be expected to file quarterly and report annually.
Advertising and Promotion
As of 2025, authorities have established additional restrictions against promoting online gambling with any form of illegal reconciling access to illicit gambling operations, and public messaging has reinforced that facilitating access to illegal online casinos is an act of criminal conduct in itself. In traditional media messaging has regulation for public sports and lotteries – though messaging for IR casinos is expected to have equally strict rules for promotional purposes once opened.
Taxation and Revenue
Publicly operated gambling and lottery operations are organized to generate public revenue through regulated takeout and prescribed allocations to other collateral agencies; the exact takeout rate and allocation will vary by product and operator. Recent visitor-facing summary activities may present takeout snapshots, but exact numbers should be verified directly with the operator because the takeout rate can fluctuate and adjust over time. The casinos of the IRs will also be subjected to specially prescribed taxation and licensing fees as outlined in the implementing regulations. This will be increasingly concrete as the Osaka opening approaches.
Japan’s Model Compared to Other Countries
Japan’s IR approach is a derivative of Singapore’s tightly regulated casino environment (limited location and heavy compliance), with some Japanese attributes still intact (the prize-exchange element of pachinko, public benefit rationale for sports betting and lottery). Unlike liberalized online gaming markets, which exist in some parts of Europe, Japan still has an outright ban on online casinos while implementing an in-person, tightly regulated resort. Policymakers frame this as finding the balance between economic activity and social protection. This shift is evidenced by the intensified focus on online casino marketing and advertising set to take place in 2025.
Japan’s gambling laws are a lesson in precision: the Penal Code states directly, and every legal act and event resides directly on statutory scaffolding, with regulators and compliance processes, and with constraints related to social policy. If you anticipate operating or marketing, or even just creating content, in the realm of gambling activities, the safest possible patina on the simplest rule of thumb is: If you cannot find a Japanese law that expressly states you can, assume you cannot, especially in the case of online and social media.
Frequently Asked Questions
Q: Is betting on sports on international websites legal for people living in Japan?
No. The site or platform must be part of Japan’s approved public-sports betting systems.
Q: Is unlicensed poker games for an income legal?
Unlicensed private gaming for money risks violating Article 185 (and potentially Article 186 for organizers). There is no “social gaming” exception akin to some Western jurisdictions.
Q: Can I get a cash payout from a pachinko parlour?
No, you cannot get cash directly from the pachinko parlour. The legal system relies on a specific non-cash prize for play, and a separate shop that buys back a certain prize.
Q: Will a casino in Osaka allow online play for hotel guests, or allow a hotel guest to place a bet while on the premises?
No, IR laws only allow for on-property casino gaming; that does not legalize online casinos for anyone (resident or visitor).
Q: Is there a legal opportunity for foreign companies?
Yes, mainly in the IR supply chain (hospitality, MICE, entertainment tech industry, security, AML systems), but not for online casinos.
