SIM-free means a device can use any carrier's SIM card without being locked to a specific operator. SIM-free devices accept Docomo, au, or SoftBank SIMs by simply inserting them, and easily switch to MVNOs.
Japan long practiced "SIM locking" where carrier-sold devices only accepted their own SIMs, suppressing switching and retaining customers. Ministry guidance mandated SIM unlock availability from 2015, and devices sold after October 2021 are SIM-lock-free by default.
Benefits include carrier freedom, using local SIMs abroad for cheap communication, and easier used device resale. iPhones from Apple Store and Pixels from Google Store are SIM-free from purchase.
Note that SIM-free doesn't guarantee compatibility - the device must support the carrier's frequency bands. Overseas devices may lack Japanese carrier bands. Verify band compatibility before MNP transfers.