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Policy Watch

Second call for circular-economy subsidy sets ¥100mn project floor and no ceiling

A second call for Japan's resource-circulation subsidy offers up to half of eligible costs to SMEs and a third to large firms, with a ¥100mn per-project minimum and applications closing on 6 November.

By Tokyo Brief DeskOct 1, 20262 min read
A recycling production line feeding baled recycled material into a forming machine, with refurbished appliances stacked on pallets nearby.

The Low Carbon Investment Promotion Organization has opened a second call under the fiscal 2026 Autonomous Resource Circulation System Resilience Promotion Project, a decarbonization subsidy funded through the government's GX programme. Applications run from 1 October to 3pm on 6 November 2026.

What it pays for

The subsidy covers building, design, equipment and construction spending in three categories: making products from recycled material, "eco-design" manufacturing that makes products last longer or easier to recycle, and reuse and refurbishment businesses. Each covers technology development, demonstration and commercialisation.

Proposals must meet at least one resource target. Recycled content of at least 10% in the product satisfies the first. Putting an eco-designed product on the market within two years of project end satisfies the second. Reusing at least half of the waste bought in satisfies the third.

Rates, floor and timing

The subsidy rate is up to one-half for small and medium-sized firms and up to one-third for large companies. An SME owned half or more by a single large company, among other tests, gets the large-company rate.

In its section on subsidy upper and lower limits, the guidelines set a minimum of ¥100mn per project and no upper limit. Projects must finish, with all payments made, by 28 February 2029.

The application needs both a jGrants submission and a mailed paper set. The deadline line requires the jGrants submission to be in by 3pm on 6 November and the mailing to have been sent by then. An optional pre-application by email to the secretariat is open from 1 to 19 October. Applicants must be members of the Circular Partners public-private network. They must also join the GX Future League and report emissions: a non-member must file a membership application by the time it applies for the subsidy and report its 2030 emissions target and commitment within four months, while SMEs may instead submit other greenhouse-gas reduction initiatives. A committee will score proposals and hold interviews, and if requests exceed the budget, the highest-scoring projects are funded first.

Starting early carries risk

Spending before a grant decision is normally ineligible. Applicants can instead file a pre-start notice on jGrants between 1 October and 6 November, and costs incurred from the start date the secretariat accepts may qualify.

Acceptance does not promise an award: a project that is not selected receives nothing. Costs incurred before the accepted start date are excluded, and the usual procurement rules, competitive bidding or three quotes, still apply, with a written reason needed where quotes cannot be obtained.