Legal Issues for TikTok Shop and Live Commerce: Mail-Order Disclosures, Stealth Marketing and Returns

Hello, I'm Noriaki Asato, Representative Attorney at LegalAgent.

A product is introduced during a live stream, and by tapping the link on screen, viewers can go all the way to purchase while continuing to watch. TikTok Shop launched in Japan on June 30, 2025, linking short videos, LIVE streams, introductions by creators and in-app payment into a single path. The ease that encourages impulse buying is a major advantage for sellers, but from a legal perspective, because everything from product introduction to application and payment is continuous, it is important to check the representations at each stage throughout.

If a stream starts while it is still unclear who the seller is, it becomes unclear who should bear the display obligations under the Act on Specified Commercial Transactions, who should serve as the contact point for returns, and who bears advertising responsibility under the Premiums and Representations Act. First, clarify the respective roles of the brand, the merchant, the streamer and TikTok Shop. Then check everything from what is said during the stream to the product page and the purchase confirmation screen, connecting them as a single transaction.

Transaction Relationships Starting From the Seller

According to TikTok's announcement for Japan (Japanese), on TikTok Shop sellers can sell products through shopping videos and LIVE streams, and creators can introduce products through an affiliate program. Functions such as payment, order management, and returns and refunds are also provided on the platform.

However, the fact that the platform provides the screens and payment system does not automatically make the platform itself the seller. Who is responsible for delivering the product to the purchaser, receiving payment, and dealing with non-conformity and returns is determined from the content of the merchant agreement, the representations on the purchase screen, the payment collection mechanism and how inquiries are actually handled.

If the merchant is the seller, that merchant bears the display obligations and other duties as the seller in mail-order sales. Where a brand owner supplies the product and a different company handles sales, there will be situations where the brand name seen in streams and ads does not match the legal seller. Whether the streamer holds inventory and sells it themselves, or merely introduces another company's products for a performance-based fee, must also be clearly distinguished. A situation where, after purchase, the purchaser cannot tell "who they actually bought from" without searching is a problem as a transaction representation, before it is even a matter of day-to-day troubleshooting.

The Live Screen Is Also a Mail-Order Advertisement

Transactions selling products on TikTok Shop usually constitute mail-order sales under the Act on Specified Commercial Transactions. Article 11 of the Act on Specified Commercial Transactions (Japanese) requires mail-order advertisements to display the sales price, shipping charges, the timing and method of payment, the timing of delivery of the goods, any special return terms, the seller's name, address, telephone number and so on. Certain items may be omitted by stating that they will be provided without delay upon request, but in that case a system must be in place to respond promptly to requests. Also, design the path so that purchasers can receive that information before deciding to order, and clearly distinguish items that may not be omitted, such as special return terms.

LIVE streams do not always go according to the script. In the heat of a stream, phrases like "half price today only," "only a few left" or "guaranteed results" may come out. The audio and captions during the stream, pinned comments, product cards, the linked product page and so on are all judged as a series of representations received by consumers. Even if the correct price is shown on the product page, if the streamer states a discount rate or stock level that differs from the facts, the stream itself must be corrected.

Article 12 of the same Act prohibits representations about transaction terms such as the performance, quality and price of goods that are significantly contrary to the facts, or that mislead consumers into believing the goods are significantly better or more advantageous than they actually are. Misleading representations as to quality and as to price and terms under Article 5 of the Premiums and Representations Act also become issues in parallel. When describing the feel of use or effects in a stream, decide in advance whether this remains a personal impression or claims a general effect, and if a general effect is to be claimed, check the objective supporting materials before selling. Even if "this is a personal impression" is added in small print, if the overall impression of the screen promotes a general effect, that note alone does not relieve the advertiser of responsibility.

Representations on the Purchase Confirmation Screen

Article 12-6 of the Act on Specified Commercial Transactions requires that the screen on which mail-order applications are received clearly state the quantity of the goods, the sales price and shipping charges, the timing and method of payment and the timing of delivery, and, where there is an application period, its deadline, as well as matters concerning cancellation and returns. It also prohibits representations that may prevent consumers from easily recognizing that the screen is an application procedure, and representations that mislead them about these items.

The Consumer Affairs Agency's "Guidelines on Representations at the Application Stage of Mail-Order Sales" (Japanese) indicate that cases where applications are accepted through SNS chat functions and the like may also be subject to the regulation, and that representations are to be checked on the basis of the screen immediately before the order is confirmed. The display obligations for advertising screens and the display obligations for the final confirmation screen are separate rules. No matter how carefully the terms were conveyed during a LIVE stream, the statements on the final confirmation screen cannot be omitted.

In paths that handle subscription purchases, if only the first-time price is made prominent and the layout makes it easy to overlook the price from the second delivery onward, the quantity per delivery, the total amount and the cancellation method, consumers may be misled about the terms. Avoid screen designs that hide terms away from the purchase confirmation button or bury them deep in linked pages. That said, screen transitions and scrolling are not prohibited across the board, and there may be room for them to be accepted if it is clearly indicated what is stated where and the information can be checked easily. Pay attention to designs in which pressing a button labeled "Next" confirms the order and the screen does not make it readable that this is an application. A consumer who applied after being misled by an improper representation contrary to Article 12-6 of the Act may be able to rescind the application under Article 15-4 of the Act.

Even where everything through payment is completed within the app, looking only at the product pages that the company can control is not enough. If the final screen changes depending on login status, the application of coupons, the purchase quantity or the type of contract, check each purchase route on an actual device and keep screen captures and the date and time of checking as a record. These are points to check that are common to mail-order sales in general, and there is no intention to assert that functions such as subscription purchases are actually available on TikTok Shop. Check the scope of each function against the actual contract terms and the latest specifications.

Creator Posts and the Advertiser's Responsibility

Since October 1, 2023, representations that are advertisements but are difficult to identify as such have been regulated as improper representations under the Premiums and Representations Act. As a rule, it is the advertiser involved in deciding the content of the representation that is subject to regulation. Whether a representation is assessed as the business's own representation is determined comprehensively, looking not only at whether a fee was paid to the creator but also at whether products were provided free of charge, whether instructions were given on post content, whether revisions were requested, and whether there were exchanges creating expectations of a future business relationship.

The Consumer Affairs Agency's Q&A on stealth marketing (Japanese) also explains that where a business was involved in deciding the content of an influencer's post, the representation becomes the business's own representation. Affiliates are generally not the suppliers of the goods and are therefore considered less likely to be directly subject to the regulation, but it is a different matter if there are circumstances in which they are regarded as jointly supplying the goods. Even if the advertiser explains that "the streamer said it on their own," involvement may be found from scripts, materials provided and records of prior approval.

Labels such as "#PR" should not simply be attached; attention should also be paid to their position and visibility. Check whether it is conveyed as an advertisement even to viewers who join a LIVE stream partway through, whether the display position and display time are sufficient, and whether the boundary between product introduction and casual chat has become blurred. When reusing material in archive videos, clips or short ads, each must also carry a representation that makes it identifiable as an advertisement when viewed on its own.

As an advertiser, go beyond checking scripts before the stream and also check published streams and posts afterward. If you decide in advance whether to correct immediately with a pinned comment, interrupt the stream or make the archive private when a streamer departs from the agreed expressions, you can reduce the risk of improper representations being left uncorrected.

When outsourcing streaming or production to a creator who is an individual without employees, or a corporation with no officers other than the representative and no employees, also check whether the Freelance Act (Japanese), that is, the Act on Ensuring Proper Transactions Involving Specified Entrusted Business Operators, applies. Where Article 3 of that Act applies, the statutory transaction terms, such as the content of the deliverables, the amount of remuneration and the payment date, must be clearly indicated in writing or by electromagnetic means immediately upon commissioning the work. There is an exception for items that cannot be determined at that time for justifiable reasons, but the reason they are undetermined and the scheduled date for determination must be indicated, and they must be supplemented immediately once determined. At the same time, set out in the contract at the time of ordering the scope of use of the deliverables, their reuse in advertising and the ownership of copyright.

Avoid an approach in which only a performance-based fee is agreed and the advertising use of videos and the rights relationships are added orally later. Depending on individual requirements, such as whether the ordering party uses employees, whether the corporation has multiple officers and whether the outsourcing period continues beyond a certain length, the scope of applicable obligations changes, including payment of remuneration within the deadline, measures against harassment and advance notice of mid-term termination. Furthermore, in outsourcing to creators, consideration of the Act on Ensuring Proper Transactions with Small and Medium-sized Entrustees (Torihiki Tekiseika Act) (Japanese), which took effect in January 2026, is also indispensable, depending on the parties' capital and number of employees and the content of the outsourcing.

Note also that it may apply concurrently with the Freelance Act, and that it is not limited to a framework covering only transactions between corporations.

Returns, Refunds and Handling Inquiries

Mail-order sales do not have a statutory cooling-off system like door-to-door sales. However, under Article 15-3 of the Act on Specified Commercial Transactions, if special return terms are not properly displayed, the purchaser may cancel the contract within eight days from the date of receiving the goods, bearing the cost of return shipping. If you set special terms under which returns are not accepted, returns after opening are not accepted, or a policy on the handling of food and hygiene products, display them in an easy-to-find position on both the product page and the final confirmation screen.

Even if special return terms are set, the seller cannot escape sales liability where the goods delivered differ from what was ordered, were damaged, or do not meet the displayed quality. Clearly distinguish returns for the purchaser's own reasons, shipping accidents, non-conformity, cancellation of subscription purchases and so on, and set the contact point and who bears the costs.

Also decide in advance which of TikTok Shop, the merchant, the logistics company and the payment provider will receive the purchaser's first inquiry. Even if refund processing is carried out on the platform, matters such as ownership of returned goods, how they are put back into inventory and the cancellation of affiliate fees need to be sorted out separately. Between the merchant agreement and the creator agreement as well, make the adjustment of fees upon refunds, chargebacks, responses to fraudulent orders and the burden of product recalls consistent.

Reviewing Streams, Screens and Contracts Together

In live commerce, if the stream script, product pages, purchase confirmation screen, returns handling and creator contracts are checked separately, discrepancies in the transaction parties and the terms presented tend to be overlooked. After clarifying the division of roles between the seller and the platform, LegalAgent conducts legal reviews that look across representations, terms of use and day-to-day operational flows as a single transaction. For related support, please see Advertising Review, IT, SaaS and System Development Legal Services and Legal Outsourcing.