Privacy Protection Driving Shredder Sales in Japan

With stiffer privacy protection laws heading for the books in Japan, everyone it seems is snapping up paper shredders to destroy documents that contain sensitive personal data.

As of April, companies will have to be especially careful about keeping control of records with personal information, such as receipts, credit card applications and bank statements. Violators could face imprisonment of up to six months, or a maximum fine of 300,000 yen.

Last year, domestic paper shredder sales increased by 30 percent over 2003.

But it isn't just companies taking the new privacy policy seriously.

Shredders are finding their way into cram schools, video rental shops, wedding and funeral halls-even the neighborhood dry cleaners.

West Japan Railway Co., a Japan Railway station in Osaka that purchased a paper shredder last November, plans to introduce paper shredders at 128 more stations in fiscal 2005.

According to a company official for Meikoshokai Co., the largest manufacturer of paper shredders in Japan, its clientele, once almost exclusively government offices and financial institutions, suddenly changed last year.

Meikoshokai is now dealing with a wide range of businesses.

Some department stores and cellphone shops like to keep a paper shredder handy by the cashier or near the reception desk to shred any botched forms right before the customer's eyes.

A Meikoshokai official explained: ``They're showing that they take private data management seriously.''

More companies are choosing to install shredders on every floor or at every outlet rather than have the paper collected and processed by the general affairs department.

That probably explains why the company is selling many small shredders that cost less than 200,000 yen. Machines that make short work of floppy discs and CDs are in high demand, too.

Fear of identity-fraud crime is also behind the surge in business. Data-filled documents carelessly disposed of are increasingly ending up in the wrong hands.

Come April, when privacy laws come into full effect, companies that leak personal information will be subject to reprimand and even criminal liability. Beyond that, there is even the possibility of civil suits for damages.

This development has not been lost on office equipment and supplies manufacturers.

They are busy holding seminars on privacy policies and how to protect personal data, hoping to expand sales even further.

Nakabayashi Co., based in Osaka, provides a unique ``extra.'' Offering a ``shredding service that comes to you,'' the company dispatches a truck with a large shredder to an office to make quick work of unwanted documents.

Nakabayashi has even begun a tie-up with a used paper dealer to recycle the shredded documents.

Jiro Makino, a lawyer specializing in personal information protection, commented: ``When it came to destroying documents, (personal information) was being treated without proper respect. Work was outsourced or paperwork was simply thrown out together with other burnables. Now, if there is a privacy leak, corporations will not only lose their credibility but also be prone to identity fraud cases such as the rampant ore, ore (`it's me') crimes, and may end up getting stuck with huge compensation bills.