Obtaining a first Japanese driving licence can be a paperwork exercise for individuals with licences from countries with exchange agreements, or a case of starting from scratch for those without licences from countries with exchange agreements.
Exchanging a foreign driving licence
Eligible holders of licences from the following countries, states and territories (correct as of May 2021) do NOT need to take either the written or practical driving test:
Australia, Austria, Belgium, Canada, Czech Republic, Denmark, Finland, France, Germany, Greece, Hungary, Iceland, Ireland, Italy, Luxembourg, Monaco, Netherlands, New Zealand, Norway, Poland, Portugal, Slovenia, South Korea, Spain, Sweden, Switzerland, Taiwan, United Kingdom, Hawaii (USA), Maryland (USA), Ohio (USA), Virginia (USA) and Washington (USA).
To be eligible for the exchange, licence holders need to be at least 18 years of age, hold a valid (not expired) licence with a Japanese translation (which is recommended to be done at JAF in Japan), be able to prove they lived in the country of issuance for at least three continuous months since the issuance of the licence, have a status of residence in Japan, and complete all paperwork and payment requirements. For them, it will be a paperwork plus eye-test exercise.
The police department in each prefecture manages the process, so it's best to check the website (invariably in Japanese only) of your local police department for the requirements.
JAF has an English article summarising the process.
Obtaining a licence via driving test or driving school
Holders of licences from countries, states and territories not listed above, and those without driving licences from other countries will need to take a written and practical driving test or graduate from a driving school to obtain their licence.
Licence type and validity
Japanese driving licences come in three colours with different periods of validity. There are additional nuances to the rules, but generally:
Green licence: until 1 month after the third birthday since acquisition (ie valid for 2 years + until birthday + 1 month)
Blue licence: 3 years (date of expiry will be birthday + 1 month)
Gold licence: 5 years (date of expiry will be birthday + 1 month)