Dual citizenship is kind of gray area in Japan. As long as you don't talk about it, nobody really cares. (And this attitude kind of sums japan as a whole)
Obviously: rules are rules, and in Japan rules just cannot be broken or bent.
However the level of proactive enforcement of such rules can be very variable. Dual-citizenship can be trivially hidden and nobody will hunt you down for it, particularly if you live abroad. If you bring it to the attention of some authority, though, they will be forced to take action.
