Japan is known as a strict jurisdiction for forex brokers to operate in, with the Japan Financial Services Agency (FSA) keeping a close look on all brokers operating there. The Japanese regulator is also known to do what it can to keep Japanese traders from trading with overseas forex brokers, which is a major reason why so many international brokers have a local presence in Japan.
With the number of forex brokers in Japan being so great, competition between them is also fierce. As always when there is competition between brokers, spreads tend to be lower on most popular currency pairs, whether the trader is using a commission-free trading account or not. Low spread forex brokers are therefore easy to come by in Japan, which is a great benefit for the large community of Japanese forex traders.