I think this law may have been recently lifted though.
Pretty sure the ban has been lifted in the last year.
It only
seems as though the ban has been lifted in recent times due to such a proliferation of uncensored material having become available via the Internet. In fact, the unpixelated versions are (supposedly) shot for overseas distribution only... whereupon they become available to porn subscribers or downloaders in Japan effectively overnight (often by way of targetted Japanese-language-only websites) with
de facto legal impunity, thanks to the source files being hosted outside Japan.
Since 2007, and more especially in the past 18 months, most of the major porn producers have gotten in on the act of producing pixelated domestic versions and unpixelated 'overseas' versions of all their releases. Which is why it's so much easier to find 2008/2009 releases in uncensored form, as Jeff Black suggests.
In other words, technology once again has effectively triumphed at the current time in circumventing the strictures of the penal code as applied through the Japanese film industry's self-regulatory bodies.
Bokashi (optical fogging), or more commonly in recent years, digital
bokashi mosaic, has been commonly in use since 1970, and was originally applied to both pubic hair and genitalia. However, the 'hair ban' was lifted in August 2006, leading to the DVD re-release of numerous older (particularly arthouse) titles in
hair mushuusei kanzenban ('unaltered pubes') versions with an R-18 rating for adults only. If any genitalia is shown in these films, though, then the
bokashi cuts in again.