I ~think~ they are rather more like states than counties as, similar to states, they can set some of their own laws/by-laws. At least, that's what my teacher said to explain why when I was trying to find out the legal age of consent and various other things it varied almost by prefecture. I'm not sure though, can anyone straighten this out?
At any rate, counties can't. They can set minor regulations for things like minimum development provisions etc, but not actually have different laws from anywhere else.
So prefectures have more independence than British counties, but are still not quite as autonomous as American states. According to my googlefu, it's translated as a 'prefecture' as the system was roughly based on French Departments, only they were using 'department' to mean all the various administrative levels in government and business and applying it to localities as well would have been confusing.
wiki article here:
Prefecture - Wikipedia, the free encyclopedia