ECONOMIC PARTNERSHIP AGREEMENT BETWEEN JAPAN AND THE EUROPEAN UNION AND LEGAL ISSUES: A FOCUS ON INVESTMENT

Abstract

Negotiations regarding the free trade agreement between Japan and the European Union (EU) date back to 28 May 2011, just after the Fukushima accident. Both sides agreed to start a scoping process to conclude a free trade agreement (FTA). At that time, the EU and South Korea concluded a free trade agreement that entered into force in July 2011. Facing such a change, Japanese economic circles began demanding a similar agreement with the EU because Korean and Japanese products compete to some extent. Following the successful conclusion of the Scoping Exercise, the European Commission decided to ask the Council of the EU for a negotiating mandate for the Japan-EU negotiations in July 2012. The first round of negotiations was conducted in Brussels from 15 to 19 April 2013 with the second round taking place in Tokyo from 24 June to 3 July 2013. The deadline for the negotiations was set for one year hence from the EU side. One year later, the EU reviewed the negotiations process and decided to continue to negotiate with Japan. Most recently, the thirteenth round of negotiations on the Japan-EU Economic Partnership Agreement (EPA) took place from 26 October to 6 November 2015. According to the Ministry of Economy, Trade and Industry (METI), the EU is an important trade partner that accounts for 10% of the Japanese total import and export value (the third largest value behind China and the USA). 1 Japanʼs investment in the EU is the secondlargest investment destination behind the USA, and investment from the EU is the largest in Japan. 2 Japanʼs main areas of interest are 1) tariff elimination of EU industrial goods (e.g. auto 10%, electronic devices 14%), 2) movement of persons and other barriers and 3) transparency and improvement of the operation of regulations. 3 The first area holds the most interest for Japan and Japanese companies. On the other hand, the EUʼs interests are 1) Japanʼs Non-Tariff Hitotsubashi Journal of Law and Politics 44 (2016), pp.19-30. C Hitotsubashi University