If your car has failed its shaken, is too expensive to repair, or has been sitting unused, you might be wondering what to do with it. Many people assume "scrap = junk," but in Japan, scrapping a car is a regulated process. Done correctly, you can earn money and stay fully compliant with the law. Done wrong, you risk fines or even legal trouble.
At JD TRADING CO.,LTD, we help individuals and businesses in Japan sell their end-of-life vehicles quickly, safely, and legally. Here's everything you need to know before you scrap or sell your car.
🔍 What Qualifies as a Scrap Car?
A car is considered "scrap" or 廃車 (haisha) when:
- The shaken (vehicle inspection) has expired or repair costs exceed its value.
- It's been in a major accident or is non-drivable.
- It's too old, rusted, or has severe mechanical issues.
- It's sitting unused for a long time.
Even in this state, your car is still legally registered to you until it's formally deregistered.
⚖️ Understanding the Legal Framework
🏛 Automobile Recycling Law (自動車リサイクル法)
This law ensures proper collection and recycling of airbags, fluorocarbons, and metals. Every car in Japan has a Recycling Ticket (リサイクル券) showing that a recycling fee has been paid.
🚯 Waste Management & Licensing Law
Only licensed dismantlers (解体業許可業者) and traders (古物商許可) can legally handle end-of-life vehicles. Selling to unlicensed dealers can expose you to penalties if the car is dumped illegally.
💼 Who Can Legally Buy Your Scrap Car?
You have three safe options:
Licensed Scrap / Recycling Companies
They handle the full legal process — pickup, dismantling, recycling, and deregistration — and issue official proof when completed.
Registered Used-Car Dealers / Export Traders
If your car can still run or be exported, licensed dealers may buy it for resale or export. Ensure they handle all deregistration paperwork.
Authorized Municipal Disposal
Some municipalities partner with certified recyclers. This is slower but guarantees full compliance.
💡 Tip: JD Trading is a licensed dismantler and exporter — we buy, dismantle, and handle deregistration for you, ensuring full compliance with national laws.
📑 Documents You'll Need
Before scrapping or selling, prepare these:
| Document | Japanese | Purpose |
|---|---|---|
| Vehicle Registration Certificate | 車検証 | Confirms ownership |
| License Plates (2) | ナンバープレート | Required for deregistration |
| Personal Seal (Inkan) | 印鑑 | For authorization |
| ID (Driver's License or MyNumber Card) | 身分証明書 | Identity verification |
| Recycling Ticket | リサイクル券 | Confirms recycling fee payment |
| Compulsory Insurance Certificate | 自賠責保険証明書 | May affect refund |
| (If deceased owner) | 戸籍謄本等 | Needed for inheritance transfer |
If a buyer claims "no documents needed" — that's an illegal practice. Walk away immediately.
🚚 The Step-by-Step Legal Process
Request a Free Estimate
Provide your car's make, model, year, mileage, and photos. Licensed buyers like JD Trading will give you a no-obligation quote.
Confirm Buyer Credentials
Ask for the dismantling license number (解体業許可番号) or dealer permit (古物商許可番号). Verify their address and contract details.
Schedule Pickup or Drop-off
Free pickup is often available within a set radius. If driving in, confirm the yard's location and working hours. Always sign an acceptance form before handing over keys.
Deregistration (抹消登録)
The most important step. Your buyer or you must file permanent deregistration (永久抹消登録) at the local Transport Bureau (運輸支局). You'll receive a deregistration certificate — proof the car is legally removed from your name.
Receive Payment
A legitimate buyer pays immediately by cash or transfer, with a receipt.
Claim Refunds
You may be entitled to automobile tax refund (自動車税還付金), weight tax refund (自動車重量税) if shaken time remains, and compulsory insurance refund (自賠責保険).
💰 How Scrap Car Prices Are Calculated
Your payout depends on multiple factors including vehicle type & engine size, condition, market metal prices, pickup distance, dismantling costs, and export potential.
| Factor | Influence |
|---|---|
| Vehicle Type & Engine Size | Larger = more scrap metal value |
| Condition | Running vehicles fetch higher value |
| Market Metal Price | Steel, aluminum, copper fluctuate |
| Pickup Distance | Free near yard, fee for long-distance |
| Dismantling Cost | Deducted if severe damage |
| Export Potential | Drivable cars worth more overseas |
Example ranges (as of 2025):
(Indicative only; market fluctuates.)
⚠️ Common Mistakes to Avoid
| Mistake | Consequence |
|---|---|
| Selling to unlicensed "cash buyers" | You remain legally responsible; risk penalties |
| Not returning license plates | Tax bills continue in your name |
| Ignoring deregistration | Vehicle still registered = legal liability |
| Stripping parts without a license | Violates recycling law |
| No written agreement | No proof if buyer disappears |
Always insist on a receipt + deregistration confirmation.
🧾 Business & Fleet Owners (B2B)
For logistics, construction, or rental companies disposing of multiple vehicles, prepare a fleet list (VIN, engine cc, registration date). JD Trading offers bulk pickup, on-site evaluation, and official tax-refund reports. Receive documentation suitable for corporate compliance and accounting.
🌱 Environmental & Recycling Commitment
JD Trading partners with certified facilities to ensure safe removal of fluorocarbons and hazardous materials, reuse and resale of functional parts, metal recycling compliant with Japan's environmental standards, and export of certified parts to markets in the Middle East and South Asia. Selling your scrap car responsibly helps reduce environmental waste and supports Japan's circular economy.
✅ Quick Legal-Sale Checklist
📞 Need a Safe, Legal Buyer?
JD Trading Company — Licensed Dismantler & Exporter
181-13 3-sen Otanoshike, Kushiro City, Hokkaido, Japan
Service Area: All Japan
Languages: English / 日本語