can take place within one municipality or between multiple municipalities and are required to be based upon consensus.
History
There have been waves of merger activity between Japanese municipalities. The first merger, known as , had happened in the period from 1888 to 1889, when the modern municipal system was established. Before the mergers, existing municipalities were the direct successors of spontaneous hamlets called , or villages under the han system. The rump han system is still reflected in the postal system for rural areas as postal units called . The mergers slashed ‘natural settlements’ (shizen sh¯uraku) that existed at the time from 71,314 to 15,859 cities, towns and villages, justified at the time by the increased scale and relevance of the resulting respective autonomous governing bodies.
The second peak, called , took place over the period from 1953 to 1956. It reduced the number of cities, towns and villages by over half, from 9,868 to 3,472 with purposes of the establishment of a National Treasury Subsidy System. 5,000 villages were disappeared, but the number of cities were doubled.
In 1965, the Special Law for Municipal Mergers (SLMM) enacted but it failed to motivate municipalities to voluntarily merge with others.
Causes
Declining birthrate of Japan and very bad fiscal led the Japanese central government to promote national consolidation reform.
As of January 2006, many municipalities in Japan contained fewer than 200 residents. Japanese municipalities require skilled workers. 40% of Japan's GDP consisted of debts from local governments. Japan merges local governments to expand residential area per municipal government, create different school attendance boundaries for elementary school and junior high school students, and to allow more widespread use of public facilities.
Merger
After the Decentralisation movement started, based on the Omnibus Decentralization Law and an amendment to the Special Law for Municipal Mergers (SLMM) in 1999, which provided strong financial and economic incentives for municipal consolidation, the central government forced municipal mergers by using incentive schemes according to special financial measures.
Grace period to keep an original grant after municipal mergers, instead of combining two municipalities. If city A received 0, city B received 100, a combine would keep 100, guaranteeing the same amount of grants. After mergers, the issue of special local bonds would be paid through central government grants. There special bonds provided very strong incentive for the implementation of public works to support the new merged municipalities.
Although mergers were not mandatory, the central government established the goal to decrease municipality numbers to 1,000, and used incentives to urge prefectural governments to promote merger. There are two types of merger. Absorption by one city of others, the core city retains its name, legal status, mayor and legislative body, and municipal offices, while the absorbed entity loses theirs. The creation of a new entity out of the merger cities, when a new entity is created, they receive a new legal status, create a new name and location for government offices, and form a new council.
Local referendums
Local governments used local referendums or questionnaire surveys on merger to evaluate public opinion. There were 352 local referendums on merging took place from 1999 to 2006.
Great Heisei Amalgamations
Vast number of municipal amalgamations were executed from 1999 to 2010, so called Great Heisei Amalgamations. Municipality numbers dropped from 3,232 to 1,727. Because the reduction of LATG from the Trinity Reform to smaller municipalities, they had to voluntary merge with others. Local governments with low financial capabilities that cannot bear an unstable fiscal was the main motivation.
From April 1999 to April 2014, there were 188 cases of municipal absorption, and 461 new municipalities. Among them, 582 consolidations were done during the Great Heisei Consolidations period from April 1999 to March 2006. This number includes duplicated consolidations.