The Supreme Court ruled Wednesday that owners of televisions in Japan are legally required to sign up with public broadcaster NHK and pay a subscription fee, dismissing a claim that the fee collection system violates the freedom of contract guaranteed by the Constitution.

The ruling that the fee collection is constitutional was handed down in a lawsuit filed by the broadcaster against a Tokyo man who persistently failed to respond to NHK's requests from September 2011 for a contract. He owned a TV from March 2006.

NHK, also known as Japan Broadcasting Corp., relies on the fees as its main source of income and has been struggling with unpaid bills.

At issue is the Broadcasting Law that states any person who has installed equipment capable of receiving NHK broadcasts shall conclude a contract with it. But the law does not stipulate that payment of the so-called broadcast reception fee is an "obligation," leaving room for arguments over its interpretation.

In the ruling, the top court's 15-member Grand Bench said the fee is intended to be paid "broadly and fairly" to ensure that the public broadcaster is financially independent and will not be "influenced by state organizations and others."

"The system has been in place to satisfy the public's right to know. It is a necessary and constitutional system to ensure freedom of expression, which is the purpose of the Broadcasting Law," the top court said.

While welcoming the acceptance of its argument by the top court, NHK said in a statement, "We will continue to explain well (to the public) why we need the system and will work to make sure that the burden will be equally shared."

The man expressed his disappointment and anger over the ruling, according to his lawyer Katsuhiko Takaike. "We totally lost, like in the district and high courts," Takaike said at a press conference.

NHK says the fee should be paid by all residents of Japan, regardless of nationality and whether or not its programs are viewed. But around 20 percent of households with TVs, mainly in major cities, do not pay the fee, according to the broadcaster.

There is no penalty for failing to pay the fee, which is about 14,000 yen ($125) for receiving terrestrial broadcasts when the payment is made annually.

According to NHK, countries such as Britain and South Korea make payment of TV license fees, which are similar to Japan's broadcast reception fee, an obligation. But past attempts in Japan to revise the 1950 Broadcasting Law to declare the fee an obligation met strong opposition.

During the trial, the man argued the Broadcast Law stipulation is legally nonbinding and only requires "efforts" to be made to enter into a contract with NHK. He also said forcing him to sign an agreement to pay would violate the freedom of contract.

The trial also looked into when a contract with NHK is concluded, with NHK claiming it is when a written request is delivered to the person concerned and the man arguing it is when the person consents to sign.

In the ruling, the top court judged that the contract cannot be deemed as concluded just by sending a request and NHK would need to win a lawsuit ordering the person to enter into a contract.

It also said the obligation to pay the fee starts from the point when a TV is installed.

The top court's ruling follows a 2014 decision by the Tokyo High Court, which upheld a 2013 Tokyo District Court order that the man sign a contract with NHK and pay around 200,000 yen in broadcast reception fees.

Facing a rising number of people refusing to pay the fee in the wake of NHK-related scandals in 2004, the public broadcaster began taking legal action to demand payment from 2006, changing its earlier policy of seeking contracts on a voluntary basis.

The proportion of TV owners paying the fee recovered to about 80 percent in fiscal 2016, but around 10 million households and businesses are believed not to be paying it.

The top court ruling, meanwhile, will not end ongoing lawsuits and disputes regarding whether the fee should be charged to people who only watch TV programs on their cellphones or the internet.

District courts have been divided on whether possessing cellphones amounts to "installing" broadcast reception equipment as written in the Broadcasting Law.

With more people spending time on the internet rather than watching TV, the top court may eventually need to rule on the issue, observers said.