Category: Uncategorized

Consumer Protection Administration, Product Safety Regulation and Contracts in Japan: Contemporary Comparisons with Australia and Beyond

Written by: Souichirou Kozuka and Luke Nottage (c) 2023

[On 19 January 2023 I interviewed Gakushuin University Professor Souchirou Kozuka about consumer law and policy developments in Japan (here on Youtube). He has been appointed to the Consumer Safety Investigation Commission within Japan’s Consumer Affairs Agency, and has co-authored papers with me on consumer credit regulation, Civil Code reform and corporate governance as well as sole-authoring several articles on consumer law in the Journal of Japanese Law, and serves as an ANJeL-in-Japan program convenor. We have summarised and expanded somewhat our conversation as below, aiming to develop a joint paper for a law journal.]

  1. Consumer Administration
    • Since 2009: Consumer Commission (independent members) supervising Consumer Affairs Agency (law reform plus enforcement)
      • Cf Productivity Commission (occasionally requested by federal Treasurer, eg 2008 Inquiry Report recommending harmonisation through ACL from 2010; 2017 Inquiry Report into consumer admin and enforcement, parallel to first five-yearly review into other ACL operations), but mostly Ministers (federal Assistant Treasurer with Treasury officials and state/territory consumer affairs ministers) deciding policy and law reform) ostensibly separated from law enforcement (federal ACCC, plus state/territory consumer affairs regulators) …[1] but latter sometime develop reform proposals for ministers and staff sometimes seconded eg from ACCC to Treasury
      CCA subsumed enforcement of Unjustified Premiums and Misreps Act from JFTC competition regulator, but not enforcement of Anti-Monopoly Law unfair trade practices “abuse of superior market provision”
      • Latter has some similarities with ACL prohibition on unconscionable conduct, former with misleading conduct (and other specific unfair trade practices) prohibitions, all enforced instead by combined ACCC (combining competition and consumer law enforcement from its established in 1970s as Trade Practices Commission – inspired by US law) and state/territory consumer regulatorsPerhaps because JFTC older (Allied Occupation), wouldn’t want to merge with newer, less-resourced CCA?
      CCA and other govt departments: Shares with METI jurisdiction over law reform for Designated Commercial Transactions Act (door-stop selling, distance selling etc: cooling off rights etc), and [see 2. Below] METI retains primary jurisdiction to set mandatory safety standards for types of (industrial) consumer products – like MHW does for foods and medical devices/services, and Transport Ministry does for cars etc
      • Cf Australian consumer affairs ministers/regulators have sole jurisdiction over such unfair trade practices, and minimum safety standards as well as bans/recalls for foods etc although have MoU with sectoral regulators and usually defer to them (but eg no power until recently to order recalls of cars – amended after Takata airbag recall problem[2])Shared or primary jurisdiction for other ministries because they are even older, more resourced (and losing jurisdiction means losing budget!)? Similar to problems with newer regulators in most (SE)Asian countries?[3]
      CCA and other stakeholders: CCA cannot seek injunctions eg to stop misrepresentations or use of unfair terms by suppliers under the Consumer Contracts Act 2000, or bring representative actions (under Brazil inspired two-stage law 2013, amended 2022), instead those via govt certified consumer NGOs (German approach, Singapore too through CASE until injunction power shifted to competition regulator now with consumer protection aspects so renamed SCCC from 2018)
      • Cf ACCC and state/territory regulators have full jurisdiction / powers for injunctions, opt-in representative actions (where individual consumers consent to regulator lawsuit) for damages – but rare, etc. But they (or consumer NGOs) don’t bring opt-out US-style class actions – instead individual/representative plaintiffs, and active law firms including (since 2006) third party litigation funders.
    CCA separate from consumer financial services regulators

Also in Australia, but eg ACCC and federal ASIC (no state laws/regulators for securites/corp law, consumer credit under shared national scheme) exchange some personnel, have some similar substantive laws (eg against unconscionable conduct and unfair terms) and if one gets greater powers/sanctions then the other usually soon asks for them too!

2. Product Safety Regulation

  • CPSA 1973 set limited pre-market controls (eg METI sets mandatory safety standards for manufactured products), but more expansive post-market controls (bans and – albeit like Australia rare – mandatory recalls) that can allow CCA to “encourage” line ministries to set mandatory safety standards.
    • ACCC and (temporarily) state/territory regulators can both ban and advise Minister to set mandatory safety performance or information/warning standards (hence covering more types of products than Japan? Although latter also encourages a voluntary product liability insurance scheme), including eg foods (konjac jelly stacks must not be smaller than 45mm in diameter, to reduce choking risks – no bans or standards set in Japan![4])Australia initiated a consultation on adding an EU-style General Safety Provision (as in EU, then Malaysia, HK, Macau and 2010 Canada, partially Singapore from 2011, and Thailand in 2019) but no progress; no discussion in Japan perhaps because CAA doesn’t even have yet powers to set mandatory safety standards for specific types of consumer goods?[5]
    CPSA amendment in 2006 (inspired by EU) requiring suppliers to report deaths or serious (hospitalised) injuries, as well as some risks (by Regulation: carbon monoxide emissions eg from gas fan heaters, and fires), to regulators; 2007 amendment also required notices to consumers to get some appliances (heaters) checked periodically
    • ACL introduced mandatory accident (but not risks) reporting in ACL 2010, but reports kept confidential to ACCC (and State/territory regulators)[6]
Consumer Safety Act 2009: channel accident reports (to local/central govt consumer centres, other depts, etc) to CAA, recalls etc if products found unsafe and not subject to other department laws (eg konjac jelly snacks!) but not to set mandatory safety standards (instead can eg urge other ministries to seek law changes to expand their jurisdiction and set standards). Also established Consumer Safety Investigation Commission under CAA, to (a) investigate causes of product-related injuries, (b) recommend actions (eg law reforms) but not liability (so like Japan Transport Safety Board)

Similarities of latter Commission with (ad hoc and semi-judicial) coronial inquiries in Australia (eg into Takata airbag deaths, op cit) or even (Royal) Commissions of Inquiry (under parliamentary supervision, so larger-scale problems)?

3. Consumer Contracts

Consumer Contracts Act 2000 inspired by EU: (a) pre-contract rules allowing broader termination rights than under the Civil Code (cf what became the 2005 EU Unfair Commercial Practices Directive – NB includes black list of worse practices), (b) regulations voiding unfair terms – some exclusion clauses, otherwise one-sided contrary to good faith principle (cf 1993 EU Unfair Terms Directive, but that has grey list of possibly unfair terms, unlike 2000 Act). Interestingly, several amendments re (a) specifying quite detailed types of transactions of concern (eg salespeople trying to use romantic infatuations or scaremongering about religion to secure contracts), but not re (b) where statute remains broad. Former maybe because higher profile and obvious or bigger problems (infecting entire contracts), making it easier for consumers / groups / CAA to mobilise, while (especially majority good) businesses prefer clarity.

  • Former NSW CJ Bathurst extra-judicially also noted that having some such guidance re (a) from legislators may also make it easier for courts to intervene to set aside contracts.[7]
    • But instead quite a push to add a new ACL prohibition on unfair practices generally (potentially wider than unconscionable or misleading conduct prohibitions)! Triggered partly by growth of e-commerce and use of “dark patterns” etc digitally[8]
Australian legislators (starting initially with Digital Services inquiries by PC etc) have enacted in 2022 comparatively unique powers of regulators to issue infringement notices and (larger) civil penalties if they think terms are unfair (and extended further 2016 amendment making terms unfair in many B2B transactions) and are consulting now about doing the same for mandatory performance standards in consumer contracts (also applicable to many B2B transactions, perhaps for political reasons), as relying on consumers enforcing ACL rights seems to have been insufficient.
  • Also likely to enact a super-complaints mechanism allowing certified consumer groups to get nominated regulators (eg ACCC, maybe also ASIC) to respond to evidence of serious / emerging consumer problems.[9]
    • Unlikely in Japan as consumer groups mostly smaller / less resources and regulators (even CAA) stronger even than in Australia in maintaining discretion, including over budget / resourcing?

ACCC latest report on digital platforms recommends they be required to have an external Ombudsman scheme free to consumers but with determinations only binding on the seller and platform[10] (like Banking and financial services or telecoms schemes, cf weaker scheme introduced more recently in Japan) which could also improve internal DR between users and the platforms

Unlikely in Japan but it has meanwhile new laws regulating some aspects of relationship between platforms and retailers, and requiring big platforms to take down products considered unsafe (inspired by laws on liability of platforms for defamation etc, and maybe new EU laws)

[1] https://consumer.gov.au/australian-consumer-law/consumer-policy-australia

[2] https://japaneselaw.sydney.edu.au/2022/05/the-interface-of-inquests-and-consumer-law-and-policy/

[3] Nottage, Luke R., ASEAN Consumer Product Safety Law: Fragmented Regulation and Emergent Product Liability Regimes in Southeast Asia (March 10, 2020). “ASEAN Consumer Law Harmonisation and Cooperation: Achievements and Challenges”, Cambridge University Press (2019), Sydney Law School Research Paper No. 20/13, Available at SSRN: https://ssrn.com/abstract=3551793

[4] Kawawa, Noriko, Jelly Mini-Cups Containing Konjac: Is a Warning Enough to Protect Vulnerable Consumers? (March 4, 2013). Australian Journal of Asian Law, 2013, Vol 13 No 2, Article 2: 135-152, Available at SSRN: https://ssrn.com/abstract=2228461

[5] Nottage, Luke R., Improving the Effectiveness of the Consumer Product Safety System: Australian Law Reform in Asia-Pacific Context (February 3, 2020). Journal of Consumer Policy (2020) 43:829-850, Sydney Law School Research Paper No. 20/05, Available at SSRN: https://ssrn.com/abstract=3530671

[6] Nottage, Luke R., Suppliers’ Duties to Report Product-Related Accidents under the New ‘Australian Consumer Law’: A Comparative Critique (May 4, 2010). Commercial Law Quarterly, Vol. 25, No. 2, pp. 3-14, 2011, Sydney Law School Research Paper No. 10/41, Available at SSRN: https://ssrn.com/abstract=1600502

[7] https://japaneselaw.sydney.edu.au/2019/11/guest-blog-launch-by-bathurst-cj-of-asian-law-books/

[8] See https://www.accc.gov.au/publications/serial-publications/digital-platform-services-inquiry-2020-2025/digital-platform-services-inquiry-september-2022-interim-report-regulatory-reform

[9] https://medium.com/@PhilipCullum/up-up-and-away-what-australia-can-learn-from-two-decades-of-uk-super-complaints-848e4469a748

[10] Ibid at https://www.accc.gov.au/publications/serial-publications/digital-platform-services-inquiry-2020-2025/digital-platform-services-inquiry-september-2022-interim-report-regulatory-reform

Guest blog: ‘Japanese Law in Context’ in the context of a global pandemic – Report on a podcast series

Written by: Melanie Trezise (PhD candidate and Research Assistant at the University of Sydney Law School, and former ANJeL Executive Coordinator)[forthcoming in Journal of Japanese Law (2021)]

Academic events in the first twelve months of the COVID-19 pandemic were almost universally united by cancellations and virtual substitutes. The hallmark Kyoto and Tokyo Seminars organised by the Australian Network for Japanese Law (ANJeL) with Ritsumeikan University Law School were no exception. For the first time since 2005, Japanese, Australian and other international students unfortunately missed the opportunity in February 2021 to attend Ritsumeikan campuses for 9 days of in-person intensive learning in Japanese law.


In order to provide continuity to the seminar program, ANJeL, together with the Japanese Studies Association of Australia (JSAA), and funded by a mini-grant from the Japan Foundation Sydney, elected to provide brief introductions to the Seminar topics as short-form video podcasts. These were conducted in interview format, which is an intentional nod to the co-teaching format of the Seminars, and many interview pairings will be familiar to attendees at previous Seminars.


The podcast series begins with a short introduction by ANJeL co-director Prof Luke Nottage (University of Sydney). It is followed by a fascinating overview by co-director A/Prof Leon Wolff (Queensland University of Technology) on the nexus between pop culture and the law in Japan. The early billing of this interview in the podcast series playlist available via YouTube is not an accident, and it is hoped that this will be a tantalising hook for the podcast audience. Wolff’s work addresses the core question of “does law matter?” in contemporary Japan by using pop culture, especially television dramas, as evidence that law does, in fact, matter. This acceptance permits a shift in the question to how law matters and in doing so, Wolff moves beyond cultural and rationalist arguments to emotional attitudes towards the law.


The subsequent interview with long-time supporters of the seminars, Ritsumeikan University professors Tetsuro Hirano and Chihara Watanabe, sets the comparative context that is at the core of the Seminars’ international setting. The interview, led by Nottage, provides a concise introduction for students to some historical and theoretical perspectives on Japanese law. It also generates a wide-ranging discussion that extends to ongoing outside and home-grown influences on Japanese law, as well as the impact of justice system reforms since 2001 on the number and availability of lawyers in Japan.


This discussion links neatly to the following interviews on the practice of Japanese law, focusing separately on mediation and arbitration, civil procedure, as well as the experience of practicing lawyers in Japan. With respect to mediation, Nottage is joined by Professors Kyoko Ishida (Waseda University) and James Claxton (Rikkyô University / Waseda University) to discuss mediation as an alternative option to court processes and the impact of formalising that process in Japan, which has somewhat paradoxically required the involvement of legal (or quasi-legal) practitioners with specialist skills. Claxton presents a compelling account of the present and future of the new Japan International Mediation Center in Kyoto (JIMC-Kyoto).


As for arbitration practice in Japan, Nottage interviewed Prof Tatsuya Nakamura (Kokushikan University), Prof Giorgio Colombo (Nagoya University, and past observer of the Seminars) and Asst Prof Nobumichi Teramura (University of Brunei Darussalam). Japan’s recent legislative reforms in this area of law are discussed, as well as Japan’s competitiveness on the international stage as a preferred forum for commercial arbitration.


Prof Yoko Tamura (Tsukuba University) provides her expertise on civil procedure and gradually shifting changes in Japanese civil justice in favour of improved timeframes for pre-trial proceedings, having a positive impact on courtroom practice. Prof Tamura also flags integrated electronic practices as a key pathway for further improvements in civil procedure, a theme that appears in the pandemic ‘bonus feature’ discussed below.


Representing Japan-based legal practitioners, Mr Jiri Mestecky (Kitahama Partners) and Ritsumeikan graduate Mr Yoshihiro Obayashi (Yodoyabashi & Yamagami) provide insights into the experience of working as international lawyers in Japan. Linking to the academic debate on culture as an explanation for Japanese law practice, Mestecky and Obayashi describe the important role of international lawyers in cultural interpretation, as well as the anticipated impact of further new rules relating to gaikokuhô jimu bengoshi (外国法事務弁護士; registered foreign attorneys at law) on the number of foreign lawyers in Japan.


Prof Kent Anderson (Australian National University and founding ANJeL co-director, who also helped establish the annual Seminars from 2005) and Prof Makoto Ibusuki (Seijo University, who also co-founded the Seminars when formerly at Ritsumeikan University) were interviewed by Nottage about their always-popular classes co-teaching Japanese criminal justice to an international student audience. This begins with asking why students feel “safe” in particular settings, then developing an innovative, holistic approach to place Japan’s striking conviction and confession statistics in a socio-cultural context.


Wolff’s interview with Prof Narufumi Kadomatsu (Kobe University) will be a crucial introduction for foreign students of Japanese law seeking to understand gyôsei shidô (行政指導; administrative guidance) and its limits. This was a difficult interview to edit with Kadomatsu’s excellent case illustration of ‘voluntariness’ in administrative guidance unfortunately not making the shortened cut. The longer versions of all interviews will remain available for ANJeL core institutions and Ritsumeikan teachers to use in the (physical, virtual or blended) classroom.


Regarding gender and the law in Japan, both Prof Kyoko Ishida and Prof Masako Kamiya (Gakushuin University) are separately interviewed by Wolff. Ishida’s personal experience as one of only two tenured female law professors at Waseda University adds poignancy and immediacy to the discussion on women in legal education and practice, and the challenges that continue to be faced by women considering entering the profession. Kamiya’s interview provides the historical and contemporary context to the issue of gender and equal opportunity for women in Japan. We made the decision to break our own rules and present this as a ‘bonus’ long-form interview for the wider public, to permit drawing out some very important background issues that were impossible to cover within the standard format of 15-20 minutes.


This discussion on gender flows into Wolff’s interview with Prof Takashi Araki (University of Tokyo), particularly on the much-cited workplace practice of lifetime employment in Japan. Araki’s insight into the changing trends and demographics in different employment practices (including burgeoning ‘irregular work’ examples of fixed contract labour, part-time work and agency labour) will be thought-provoking for viewers, even those not usually interested in or familiar with labour law and practice.


On contract law, Prof Veronica Taylor (ANU) and Prof Tomohiro Yoshimasa (Kyoto University), in interview with Nottage, present some surprises for Australian businesses and students of contract law, in particular in relation to an illustrative case on the termination of a wine industry contract. They reflect on how contract practices in Japan have changed in recent times, including an increase in documentation of contracts in large enterprises compared to continued informal contracting practices of small- to medium- sized enterprises, which lack the same resources.


Prof Marc Dernauer (Chuo University) and Nottage discuss consumer law, in particular the complexities of consumer contract and consumer law regulation in Japan. Dernauer highlights the layered public law / private law dichotomy as a surprising feature of Japanese consumer protection following legislative reform in this area especially over the past few decades. As their discussion reveals, strengthening ex post relief for consumers through private law remedies and better access to dispute resolution services, in line with the 2001 justice system reform program and earlier deregulation, has arguably not led to much unwinding of ex ante public regulation aimed at protecting consumers more directly.


The discussion by Prof Akihiro Wani (Morrison & Foerster, Sophia University) on finance and the law, interviewed by this author, has a certain prophetic feel. This is particularly so with respect to rapid changes anticipated as a result of new types of brokerage products, especially given that this interview was filmed at the end of 2020, prior to the GameStop trading controversy.


Tax law specialist and ANJeL Program Director (Teaching and Learning), Micah Burch (University of Sydney), also supported the project by conducting two interviews. His tax law interview with Dr Justin Dabner (formerly James Cook University) reflects on the experience of teaching comparative tax law in Japan, as well as the globally relevant issue of carbon taxation. Burch’s second interview, with Kyoto Seminar graduate Dr Matt Nichol (Central Queensland University), discusses Japanese and international sports law. This is the only interview topic in the podcast series that is not a regular feature of the Kyoto and Tokyo Seminars. Not unlike a demonstration sports event at the Olympics, Nichol whets the appetite for this to be included in the Seminar series in the future by delivering a fascinating bonus feature worthy of a wider audience.


In addition to the above, many of the interviews also draw out preliminary observations on the impact of the COVID-19 pandemic. In addition to including edited versions of these responses in the main feature interviews, we made the decision to create a compilation of these observations into a joint bonus feature to permit immediate comparison of the answers relevant to different areas of law and society. Many answers reflected on the role of technological solutions to continue the practice of law in as ‘business as usual’ manner as can be approximated. The inability to file court matters electronically was a frequent theme and it will be interesting to see whether virus containment measures in Japan will accelerate this change in Japanese judicial practice.


Finally, the pandemic challenge was also discussed in Nottage’s interview of Professor Naoya Yamaguchi (Ritsumeikan University, current co-organiser of the Seminars), Wolff and Anderson. They also reflect more generally on the past, present and future of the unique Kyoto and Tokyo Seminar program. As Wolff explained in this concluding bonus podcast, “continuity and change” has always been a major theme for this innovative and educational series. That is also now a fitting theme in considering the format of the Kyoto and Tokyo Seminars themselves in the context of the ongoing global pandemic.


Indeed, in-person academic conferences and seminars are much more than just opportunities for self-funded students to fill up on catered sandwich triangles and norimaki – they have an essential role in providing opportunities for people to network and get a sense of everyday life in a different socio-cultural context. Most people will agree that this has proven challenging to replicate online, at least to establish new relationships and deepen perspectives. On the other hand, digital format conferences have provided a greater degree of accessibility, as demonstrated by the inclusion of these videos on YouTube for access by the general public.


It seems certain, however, that when they can return, and in whatever format the program must take, there will be a ready audience for ANJeL’s Kyoto and Tokyo Seminars co-hosted with and at Ritsumeikan. In the meantime, this podcast series delivers thought-provoking material for students, academics and practitioners alike, as well as a kind of time capsule for this broad community of people interested in Japanese law in a global context.

“New Frontiers in Asia-Pacific International Arbitration and Dispute Resolution” (10): New Book with Kluwer

[For updates to chapter titles & authors, plus Abstracts and a link to a free related Webinar on 4 August 2020 5-6pm (Sydney time), please click here.]

Culminating a HKU/USydney joint research project and two conferences over 2019, Kluwer has agreed to publish a monograph under this title co-edited by myself, HKU Prof Shahla Ali, UBrunei A/Prof Bruno Jetin, and Dr Nobumichi Teramura. Manuscripts for the 15 chapters will be submitted by July 2020 so the book is published by early 2021, as part of Kluwer’s widely-read “International Arbitration” series supervised by QMUL Profs Julian Lew and Stavros Brekoulakis. Below is more information on the authors, editors, contributions, and expected readership/features of our new book

Book Contents:

  1. Introduction: New Frontiers in Asia-Pacific Trade, Investment and International Business Dispute Resolution – Jetin & Nottage
  2. ICA and International Commercial Courts: Singapore, Australia and Beyond – Warren & Croft (based on “An International Commercial Court for Australia: An Idea Worth Taking to Market”) [i]
  3. New Frontiers for ICA in Australia: Beyond the ‘(Un)Lucky Country’ – Teramura et al (building on “Country Report on Australia for: International Commercial Arbitration – An Asia-Pacific Perspective”[ii] and “International Commercial Arbitration in Australia: Judicial Control over Arbitral Awards”[iii])[iv]
  4. Transparency versus Confidentiality in ICA and ISDS: Australia and Japan in Regional Context – Nottage (based on “Confidentiality versus Transparency in International Arbitration: Asia-Pacific Tensions and Expectations”[v])[vi]
  5. Novel and Noteworthy Aspects of Australia’s Recent Investment Agreements and ISDS: The CPTPP and Agreements with Hong Kong and Indonesia – Nottage & Ubilava (based on “Costs, Outcomes and Transparency in ISDS Arbitrations: Evidence for an Investment Treaty Parliamentary Inquiry”[vii] and Nottage’s parliamentary submissions regarding new treaties with HK and Indonesia[viii])[ix]
  6. Hong Kong Developments in ICA and ISDS in the Context of China’s Belt and Road Initiative – Ali (based on “ICA and ISDS Developments in Hong Kong in the Context of China’s Belt and Road Initiative”[x])[xi]
  7. Harmonising the Public Policy Exception for ICA along the Belt and Road – Gu (based on “China’s Belt and Road Development and a New International Commercial Arbitration Initiative in Asia”[xii])[xiii]
  8. PRC Developments in Private International Law, ICA and ISDS – Bath[xiv]
  9. Malaysia’s Involvement in International Business Dispute Resolution – Venugopal[xv]
  10. Japan’s New Ambitions as a Regional Dispute Resolution Hub: Better Late than Never? – Claxton, Nottage and Teramura (based on “Developing Japan as a Regional Hub for International Dispute Resolution: Dream Come True or Daydream?”[xvi])[xvii]
  11. Mediating Complex Multi-level Trade and Investment Disputes Between Japan and Korea – Claxton, Nottage and Williams (based on “Resolving Disputes Amidst Japan-Korea Trade and Investment Tensions”[xviii])[xix]
  12. Indian Investment Treaty and Dispute Resolution Practice: Assessing Recent Developments – Singh[xx]
  13. Extending Dispute Resolution Provisions in Free Trade Agreements to Better Enforce Other Treaties: The CPTPP and MARPOL 73/78 – Hu and Huang (based on “Can Free Trade Agreements Enhance MARPOL 73/78 Compliance?”[xxi])[xxii]
  14. Promoting International Mediation through the Singapore Convention – Strong (based on “The Role of Empirical Research and Dispute System Design in Proposing and Developing International Treaties: A Case Study of the Singapore Convention on Mediation”[xxiii])[xxiv]
  15. Conclusions: Expanding Asia-Pacific Frontiers – Reyes, Teramura & Ali

Editors/bios:

  • Dr Shahla Ali is Professor and Associate Dean (International) and Deputy Director of the LLM in Arbitration and Dispute Resolution at the Faculty of Law of the University of Hong Kong. Her research and practice center on questions of governance, development and the resolution of cross-border disputes in the Asia Pacific region. Shahla is the author of Court Mediation Reform (Elgar, 2018), Governing Disasters: Engaging Local Populations in Humanitarian Relief (CUP, 2016); Consumer Financial Dispute Resolution in a Comparative Context (CUP, 2013); and Resolving Disputes in the Asia Pacific Region (Routledge, 2010) and writes for law journals in the area of comparative ADR. She has consulted with USAID, IFC/World Bank and the United Nations on issues pertaining to access to justice, peace process negotiation training and land use conflict resolution. She serves as a bilingual arbitrator (English/Chinese) with CIETAC, HKIAC (ADNDRC), SIAC and has served on the IBA Drafting Committee for Investor-State Mediation Rules, the DOJ Mediation Regulatory Committee, the UN Mediation Roster and the FDRC Appointments Committee. Prior to HKU, she worked as an international trade attorney with Baker & McKenzie in its SF office. She received her JD and PhD from UC Berkeley in Jurisprudence and Social Policy and BA from Stanford University. (Further details can be found here.)
  • Dr Bruno Jetin is Associate Professor and Director of the Institute of Asian Studies, University of Brunei Darussalam (UBD). His current work focuses on the ASEAN Economic Community, the One Belt One Road initiative, Chinese investments in Southeast Asia, and the impact of income distribution on growth in Asia. He is also an expert in the automobile industry. Before joining UBD, he was a researcher at the Institute for Research on Contemporary Southeast Asia (IRASEC, CNRS-MAEE, Bangkok) and Associate Professor at the University of Paris 13 Sorbonne Paris Cité, where he obtained his PhD in economics and was Deputy Director of the Research Center in Economics. He was also involved in promoting taxes on financial transactions as alternative sources for financing development as well as innovative regulation of global finance. Bruno’s recent publications include Jetin and Mikic (eds) ASEAN Economic Community: A model for Asia-wide Integration? (Palgrave McMillan, 2016); Jetin (ed) Global Automobile Demand (2 Vols, Palgrave McMillan); Jetin and Chaisse “International Investment Policy for Small States: The Case of Brunei” in Chaisse and Nottage (eds) International Investment Treaties and Arbitration Across Asia (Brill, 2018); “One Belt-One Road Initiative and ASEAN Connectivity” in Deepak (ed) China’s Global Rebalancing and the New Silk Road (Springer, 2018). (Further details can be found here.)
  • Dr Luke Nottage specialises in comparative and transnational business law, especially international arbitration and investment law, with a particular interest in Asia. He is Professor of Comparative and Transnational Business Law at Sydney Law School, founding Co-Director of the Australian Network for Japanese Law (ANJeL), and Associate Director of the Centre for Asian and Pacific Law at the University of Sydney (CAPLUS). His books include International Arbitration in Australia (Federation Press, 2010, eds), Foreign Investment and Dispute Resolution in Asia (Routledge, 2011, eds), International Investment Treaties and Arbitration Across Asia (Brill, 2018, eds), Contract Law in Japan (Kluwer, 2019, with Hiroo Sono et al) and 12 other volumes. Luke has or had executive roles in the Australia-Japan Society (NSW), the Law Council of Australia’s International Law Section, the Australian Centre for International Commercial Arbitration, and the Asia-Pacific Forum for International Arbitration. Luke is also a Rules committee member of ACICA and listed on the Panel of Arbitrators for the AIAC (formerly KLRCA), BAC, JCAA, KCAB, NZIAC, SCIA and TAI. Luke serves on Working Group 6 (examining arbitrator neutrality) for the Academic Forum on ISDS. He has consulted for law firms world-wide, the EC, the OECD, the UNDP, ASEAN and the Japanese government; and has made numerous public Submissions to the Australian government on investment treaties, arbitration and consumer law reform. He qualified as a lawyer in New Zealand in 1994 and in New South Wales in 2001. (Full CV downloadable here.)
  • Dr Nobumichi Teramura is Lecturer at the University of Adelaide Law School and Associate at the Centre for Asian and Pacific Law at the University of Sydney, specialising in international commercial law, especially private international law, arbitration, contract law, with a particular interest in Asia and Australasia. He is the author of Ex Aequo et Bono as a Response to the Over-judicialisation of International Commercial Arbitration (Kluwer, 2020 [forthcoming]). He has published and presented his research extensively in various journals and at academic conferences in different jurisdictions in both English and Japanese. He has also received scholarships and fellowships in highly competitive rounds from leading research institutions or foundations and from the Japanese Government. He was invited to De La Salle University in the Philippines (one of its top law schools) three times over 2016-2019 to teach arbitration and international commercial law, first as a visiting lecturer and later as a distinguished visiting professor.

Other book contributors:

  • Professor Vivienne Bath (Director of the Centre for Asian and Pacific Law at the University of Sydney)
  • Professor James Claxton (Kobe University Law School, Japan)
  • The Hon Dr Clyde Croft AM SC (former Judge of the Victorian Supreme Court)
  • Professor Hu Jiaxiang (KoGuan Law School, Shanghai Jiao Tong University, China)
  • A/Professor Jeanne Huang (University of Sydney Law School)
  • James Morrison (Principal of Morrison Law, Sydney; former ACICA Acting Secretary-General)
  • Justice Anselmo Reyes (Singapore International Commercial Court)
  • Prof Jaivir Singh (Centre for the Study of Law and Governance, Jawaharlal Nehru University, India)
  • A/Professor Stacie Strong (University of Sydney Law School, from January 2020)
  • A/Professor Gu Weixia (University of Hong Kong Faculty of Law)
  • Mrs Ana Ubilava (Research Assistant and PhD candidate at the University of Sydney Law School)
  • Professor Marilyn Warren AC QC (former Chief Justice of the Victorian Supreme Court)
  • Dr A Vijayalakshmi Venugopal (Senior Lecturer, Taylor’s University Law School, Malaysia)
  • Dr Brett Williams (Principal of Williams Trade Law, Sydney)

Book Aims, Necessity, Features/Benefits

This book project examines the challenges and opportunities for developing international commercial arbitration (ICA) and arbitration through investor-state dispute settlement (ISDS) particularly in the Asia-Pacific region.

Analysing ICA, the pre-eminent mechanism for resolving cross-border disputes among firms, this book builds on Anselmo Reyes & Weixia Gu (eds), The Developing World of Arbitration: A Comparative Study of Arbitration Reform in the Asia-Pacific (Hart, 2018), but examines more recent challenges for ICA. These include the proliferation of international commercial courts (including in Singapore, but also elsewhere and potentially in Australia) as well as the UN’s 2019 Singapore Convention on enforcement of mediated settlement agreements (Singapore Convention on Mediation). There is also competition now among regional centres to become attractive venues for international business dispute resolution, including resolving “Belt and Road” disputes. The present book focuses mainly on Hong Kong and Singapore (competing jurisdictions in the top “Stage 4” for ICA venues, as identified by Reyes & Gu), Australia and Malaysia (“Stage 3” venues), China and Japan (arguably transitioning from “Stage 2” to “Stage 3”), and India (“Stage 2”) but it in a wider Asia-Pacific context.

In addition, this book project compares approaches in these jurisdictions to ISDS, but we also touch on treaties concluded by Indonesia and Korea as other significant economies in the region. The ISDS procedure allows a foreign investor to bring arbitration claims directly against host states if they violate substantive commitments, such as not discriminating in favour of local investors or expropriation without adequate compensation, usually based on a treaty with the home state of the foreign investor. ISDS has become increasingly controversial as claims have been brought against developed countries, not just developing countries where this enforcement mechanism brings the greatest comfort for foreign firms considering investments. Going beyond Julien Chaisse and Luke Nottage (eds) International Investment Treaties and Arbitration Across Asia (Brill, 2018) [with an introduction partly here], this book project charts evolving treaty practices and high-profile ISDS cases, assesses whether these do or might impact on public attitudes even towards ICA or other forms of arbitration, and explores alternatives or complements to ISDS arbitration.

Why is there a need for it? / Why is now a good time to produce it?

ICA is already “big business” for leading regional venues such as Singapore and Hong Kong. But the recent social unrest in Hong Kong highlights the potential for unexpected developments, and other regional jurisdictions are anyway seeking to emulate their success. These competing venues include mainland China (where arbitrators and courts have growing capacity in cross-border matters), Australia (which may become a venue for some Belt and Road disputes) and Japan (belatedly establishing new international arbitration and mediation facilities). Yet businesses are increasingly concerned about the costs and delays in ICA. They are considering emerging alternatives such as international commercial courts or cross-border mediation, underpinned by new multilateral treaties. Established and emerging jurisdictions for international commercial arbitration therefore need to consider how to position themselves relative to these new frontiers.

ISDS arbitration is also a large and growing area of legal practice, with more engagement recently by Asian parties, yet it too faces challenges. The Philip Morris Asia claim brought under an old Hong Kong investment treaty against Australia to challenge its plain packaging legislation, although unsuccessful, led to Australia refusing over 2011-13 to agree to ISDS provisions in new treaties. Subsequent governments have agreed to ISDS in some treaties, and did so in recently signed Australia – Hong Kong investment agreement (close to ratification), but ISDS remains highly politicised in Australia. China has also been subjected to ISDS claims recently, and so may be reassessing its gradual shift since the late 1990s towards agreeing to wider ISDS-backed protections in its overseas treaties, despite them assisting Chinese outbound investors. Singapore and other Asia-Pacific states have already agreed to the alternative “permanent investment court” proposed by the European Union in their recent treaties, substituting a two-tier court staffed by judges pre-selected only by the states themselves, rather than ad hoc arbitral tribunals. Another potential alternative to ISDS arbitration is investor-state mediation, which could become a mandatory dispute resolution step in future investment treaties (as in the recently-signed Indonesia-Australia FTA).

The significance of investigating ISDS developments, in the context of possible alternatives and broader trends in ICA, is reinforced by UN deliberations into possible ISDS reforms, underway since late 2017. This book project will integrate written and oral statements made in and around UNCITRAL by some of the delegates from the key Asia-Pacific states subject to analysis.

Five features/characteristics: the book

  • analyses the challenges and opportunities for developing ICA and ISDS in the Asia-Pacific region with the latest updates
  • assesses recent challenges for ICA: the proliferation of international commercial courts and the rise of international mediation as represented by the Singapore Convention on Mediation
  • examines the increasingly vigorous competition among regional centres to become attractive venues for international business dispute resolution, focusing on: Hong Kong, Singapore, Australia, China and Japan
  • compares recent approaches in these jurisdictions to ISDS
  • is written by leading experts for ICA and ISDS in the Asia-Pacific region

Three benefits: the book help the reader to

  • make an informed decision on which dispute resolution method – ICA, international mediation or international litigation – is the most suitable for the international business dispute s/he or clients may be involved in
  • understand recent trends in ADR practice related to business in the Asia-Pacific region, and new resources for dealing with the increasing competition among countries become the next regional dispute resolution hub
  • refresh knowledge on ISDS practice and debates in significant Asia-Pacific economies in the Asia-Pacific region, including features of their recently concluded treaties

Chapter Abstracts (and related works):

[i] Abstract: International commercial courts are proliferating, including in Asia, offering a new alternative to arbitration as the hitherto dominant mechanism for resolving cross-border disputes. When the significant trade and investment treaties being concluded by Australia are considered with respect to the Asia-Pacific, the opportunities to create an Australian international court are almost boundless. Its establishment cannot be left to the Courts themselves or for the Australian legal profession to develop. The experiences of Singapore, China Dubai, Abu Dhabi, and indeed, London demonstrate that it is vital for there to be government interest and support for such a proposal. Adding an Australian international commercial court to the mix also occurs within a wider international context. A stronger contribution can be made to the rule of law by courts working together than if they are working separately. The early 21st Century is being defined by something of a return to internationalisation and globalisation, although the form and forms that will take remain to be seen. It is for judges to help shape those forms and contribute towards global stability, harmonisation and due recognition of the law in the context of commercial enterprise. These common purposes, as well as quality of justice and the manner of its administration provided at commercial courts and arbitral tribunals, international and domestic, should be promoted and indeed marketed.

[ii] Morrison, James and Nottage, Luke R., Country Report on Australia for: International Commercial Arbitration – An Asia-Pacific Perspective (October 23, 2014). Sydney Law School Research Paper No. 14/95. Available at SSRN: https://ssrn.com/abstract=2514124

[iii] Teramura, Nobumichi and Nottage, Luke R. and Morrison, James, International Commercial Arbitration in Australia: Judicial Control over Arbitral Awards (April 10, 2019). Sydney Law School Research Paper No. 19/24. Available at SSRN: https://ssrn.com/abstract=3379494

[iv] Abstract: Some ‘bad luck’ has haunted the arbitration industry in Australia. Geographical remoteness has made the country an unfavourable venue for increasing ICA caseloads compared with its competitors in the Asia-Pacific region. Fortunately, such ‘bad luck’ has not necessarily brought about excessively negative impacts. It has helped the country generate world-class Australian arbitration experts, who are contributors and responsive to developments outside the country, which has indirectly bolstered the Australian ICA industry. Such experts have assist Australia in gradually improving the local legal environment for ICA, following international standards, especially over the last 10-15 years. However, their increasingly concerted efforts and other stakeholders have not yet turned Australia into a popular arbitration hub. The country has not overcome the ‘bad luck’ yet – people still hesitate to seat ICA in the country. Analysing the status quo for ICA in Australia, this chapter discusses recent trends and the possible next steps for its service providers to find new frontiers to develop ICA locally and regionally, without depending on chance or luck.

[v] Nottage, Luke R., Confidentiality versus Transparency in International Arbitration: Asia-Pacific Tensions and Expectations (August 29, 2019). Sydney Law School Research Paper No. #19/52, August 2019. Available at SSRN: https://ssrn.com/abstract=3444692

[vi] Abstract: Confidentiality is still widely seen as significant advantage of international commercial arbitration (ICA) over cross-border litigation, especially perhaps in Asia. This can be seen in rules of most arbitral institutions. Automatic (opt-out) confidentiality is also now found in many national laws, including statutory add-ons to the UNCITRAL Model Law and/or through case law for example in New Zealand, then Hong Kong, Singapore, Malaysia, and eventually Australia. Yet there remain variations in the timing of these developments as well as the scope and procedures associated with exceptions to confidentiality. There is also no confidentiality provided in Japan’s later adoption of the Model Law, although parties mostly choose the JCAA so opt-in to its Rules, which have somewhat expanded confidentiality obligations since 2014.

Another recent complication is growing public concern over arbitration procedures through (especially treaty-based) investor-state dispute settlement (ISDS), especially in Australia since an ultimately unsuccessful treaty claim by Philip Morris over tobacco plain packaging legislation (2011-15). Statutory amendments in 2018 reverse automatic confidentiality for Australia-seated ISDS arbitrations where the 2014 UNCITRAL Rules on Transparency in Treaty-based Investor-State Arbitration. Concerns over ISDS may impede Australia enacting provisions for confidentiality of arbitration-related court proceedings, which could not be revised recently in New Zealand against the backdrop of its new government’s anti-ISDS stance.

Growing transparency around ISDS arbitration is welcome given greater public interests involved in such cases, but transparency should not be simply transposed into commercial dispute resolution through ICA as the fields are overlapping but distinct. Confidentiality in ICA has the disadvantage of exacerbating information asymmetry, making it harder for clients and advisors to assess whether particular arbitrators and lawyers provide value for money. But confidentiality allows arbitrators in particular to be more robust in proceedings and drafting rulings, thus countering the rise in ICA delays and especially costs. More transparency around ISDS, as well as initiatives like “Arbitrator Intelligence” and experiments in reforming Arbitration Rules (eg recently by the ICC), can help reduce information asymmetry for users anyway, while retaining various advantages of confidentiality particularly in ICA.

This chapter elaborates these tensions between confidentiality and transparency in ICA and ISDS, focusing on Australia and Japan in regional context. Both countries still get few ICA cases but are trying to attract more, taking somewhat different approaches to confidentiality in that field, while negotiating investment treaties that increasingly provide transparency around ISDS arbitration.

[vii] Nottage, Luke R. and Ubilava, Ana, Costs, Outcomes and Transparency in ISDS Arbitrations: Evidence for an Investment Treaty Parliamentary Inquiry (August 6, 2018). International Arbitration Law Review, Vol. 21, Issue 4, 2018; Sydney Law School Research Paper No. 18/46. Available at SSRN: https://ssrn.com/abstract=3227401

[viii] https://japaneselaw.sydney.edu.au/2019/10/new-frontiers-in-international-arbitration-for-the-asia-pacific-region-8-confidentiality-vs-transparency-in-icarb-and-isds/

[ix] Abstract: Investment treaties, and especially ISDS provisions, became a political hot potato from around 2011 when Philip Morris brought the first-ever ISDS claim against Australia under an old bilateral investment treaty (BIT) with Hong Kong. A Labor-Greens Government declared that it would no longer agree to ISDS provisions in future treaties, but when a centre-right Coalition Government regained power from 2013 it reverted to concluding treaties containing ISDS clauses on a case-by-case assessment. Australia therefore agreed to ISDS in FTAs with Korea and China, but not bilaterally with Japan. However ISDS-backed provisions apply between Australia and Japan since the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) can into force between them (and five other Asia-Pacific nations so far) from January 2019. Yet the Australian parliament engaged in robust debate about ratification of the CPTPP, with Labor Opposition (and Greens) parliamentarians continuing to voice concerns over ISDS provisions, despite the Philip Morris claim against Australia’s tobacco plain packaging having been rejected on jurisdictional grounds in 2015.

This chapter first elaborates on evidence presented to the Australian parliament favouring ratification of the CPTPP, including empirical findings about concerns raised such as the typical amounts awarded, arbitration costs, time-frames and transparency involved in ISDS proceedings. The chapter next compares the parliamentary committee report in 2018 that agreed that ratification should proceed, with a report in 2019 recommending Australia’s ratification of investment agreements (also including ISDS) with Hong Kong and Indonesia – but also early termination of an old Australia-Indonesia BIT. It shows how these two new agreements generally retain (originally US-style) CPTPP drafting, but add some innovative features (notably a mandatory mediation step that the host state can trigger before arbitration, in the Indonesia-Australia treaty), and show some variance between themselves (including more transparency for ISDS proceedings, in the Hong Kong – Australia treaty). The Labor Opposition parliamentarians have also toned down their declared opposition to ISDS, perhaps due to suffering an unexpected election loss in May 2019. Finally, chapter looks at the parliamentary inquiry into Australia ratifying the Mauritius (“UN ISDS”) Convention, retrofitting extensive transparency provisions on earlier treaties between Australia and other states that might also accede to that framework Convention. We conclude from these new developments that Australia is now better placed to play a more active role in guiding the future path of international investment treaty-making especially in the Asia-Pacific region.

[x] Ali, Shahla F., ICA and ISDS Developments in Hong Kong in the Context of China’s Belt and Road Initiative (September 13, 2019). Available at SSRN: https://ssrn.com/abstract=3453061

[xi] Abstract: This chapter examines the impact of both the Belt and Road Initiative and the UNCITRAL Model Law on International Arbitration (the Model Law) on both international commercial and investor state arbitration practice in Hong Kong. Given the significance of Hong Kong as a gateway to OBOR project financing and logistics, understanding current dispute resolution policy is critical for gaining insights into China’s approach to the resolution of OBOR disputes. Measures taken to modernize the practice of arbitration including training programmes and legislative reforms are examined with a view to gaining insights into challenges and future developments.

[xii] Gu, Weixia, China’s Belt and Road Development and a New International Commercial Arbitration Initiative in Asia (2018). Vanderbilt Journal of Transnational Law, Vol. 51, No. 5, 2018; University of Hong Kong Faculty of Law Research Paper No. 2019/012. Available at SSRN: https://ssrn.com/abstract=3346924

[xiii] Abstract: The policy centerpiece of President Xi Jinping’s foreign strategy, China’s Belt and Road Initiative (BRI), ambitiously aspires towards expanding regional markets and facilitating regional cooperation. In context of a rising volume of cross-border transactions generated by the BRI, a robust legal framework on dispute resolution is required to forge investor confidence and enable BRI’s integral goal of economic integration. In light of the substantial levels of harmonization among arbitration laws, arbitration is argued to constitute a primary vehicle of international commercial dispute resolution in an economically integrated Asia under the BRI. It is against this backdrop that the chapter argues that the BRI provides a unique opportunity to contemplate the possibility of regional harmonization, as within the Asian economies along the BRI, of the public policy exception to arbitral enforcement. Such an arbitration initiative in Asia, in which China is anticipated to take a proactive role, holds a wealth of potential to project renewed momentum on China as an engine of not only economic power, but also soft power transformation in pioneering international legal norms.

[xiv] Abstract: This chapter will outline the latest developments in the People’s Republic of China as it promotes itself as a regional hub for international dispute resolution, especially in the context of the Belt and Road Initiative, including the establishing of an International Commercial Court.

[xv] Abstract: This chapter reviews Malaysia’s involvement in international dispute resolution. This includes actual involvement in cases in the WTO and investor-state dispute settlement, and as a venue for international dispute resolution especially through the recently rebranded Asian International Arbitration Centre (AIAC). This chapter also extends to Malaysia’s potential involvement in dispute resolution of international business disputes. This part includes the challenges of enforcing foreign judgments in Malaysia and enforcing domestic judgments abroad, as well as questions around international dispute resolution clauses in Malaysia’s trade agreements. This chapter therefore highlights how Malaysia has been involved in international dispute resolution and the continuing significance of this for Malaysia, against the backdrop of significant domestic political changes in recent years.

[xvi] Claxton, James M. and Nottage, Luke R. and Teramura, Nobumichi, Developing Japan as a Regional Hub for International Dispute Resolution: Dream Come True or Daydream? (December 11, 2018). Journal of Japanese Law, Issue 47, 2019 (Forthcoming); Sydney Law School Research Paper No. 19/01. Available at SSRN: https://ssrn.com/abstract=3299097

[xvii] Abstract: The Japanese government, supported by various stakeholders, has recently been attempting to develop Japan as another regional hub for international business dispute resolution services. Tracking this development is important for both theoretical and practical reasons. How it unfolds should reveal which of various theories for explaining Japanese law-related behaviour have more traction nowadays. Assessing the new initiatives is also important for legal practitioners and others interested in the practical question of where to arbitrate or mediate cross-border business disputes. This chapter therefore reports on current attempts to promote existing and new international arbitration centres in Japan as well as the recent establishment of the Japan International Mediation – Kyoto, in the context of intensifying competition from other regional venues for dispute resolution services.

[xviii] Claxton, James M. and Nottage, Luke R. and Williams, Brett G., Mediating Japan-Korea Trade and Investment Tensions (December 3, 2019). Sydney Law School Research Paper No. 19/73. Available at SSRN: https://ssrn.com/abstract=3497299 (shorter version forthcoming in Journal of World Trade, August 2021)

[xix] Abstract: This chapter first describes the trade tensions between Korea and Japan that escalated from mid-2019. It assesses Korea’s prospects in a formal claim now brought before the World Trade Organization, noting difficulties with substantive law, but especially procedure given the general breakdown in the WTO’s usual two-tier inter-state dispute resolution process. The chapter then outlines the possibility of Japan bringing claims under a 1965 Treaty that purported to settle claims resulting from Japan’s colonisation of Korea, or under two investment treaties, regarding Korean courts recently ordering Japanese companies to pay compensation to war-time Korean labourers. Yet such claims also face procedural and/or substantive law difficulties. The chapter also elaborates the possibility of affected Japanese companies instead or in parallel bringing investor-state dispute settlement claims against Korea, similarly alleging denial of justice in Korean court proceedings, under the two treaties. We conclude that these extra complications bolster the attraction of a formal mediation to bring both countries and the affected companies together in order to achieve an overall negotiated settlement.

[xx] Abstract: This chapter provides a perspective on investment treaty practice from India, which lies at the periphery of what is traditionally associated with the Asia Pacific region. While seemingly on the periphery of this collection of countries, India has signed investment and trade treaties with many of them. It has also recently become involved in disputes under them, and so has started to terminate many bilateral investment treaties. Indians now seeks to renegotiate fresh treaties using a template provided by a new model treaty that is oriented towards privileging state rights. The chapter will look at the narrative led to this point, touching on key cases as well as drawing on some path-breaking (econometric) empirical evidence of the impact of India’s investment treaties on foreign investment. This discussion is aimed to lead to assessing the implications of this emerging configuration for the future of investment law and practice in the wider region.

[xxi] Huang, Jie Jeanne and Hu, Jiaxiang, Can Free Trade Agreements Enhance MARPOL 73/78 Compliance? (October 3, 2018). Tulane Maritime Law Journal, Vol. 43. 2018, pp. 59-91; Sydney Law School Research Paper No. 18/62. Available at SSRN: https://ssrn.com/abstract=3259734

[xxii] Abstract: Whether Free Trade Agreements can effectively encourage states to comply with the International Convention for the Prevention of Pollution from Ships and its Protocols. This question has not been well researched, although the latter has been incorporated into the former since the 2006 US-Peru FTA and most recently in the 2018 Comprehensive and Progressive Agreement for Trans-Pacific Partnership. This chapter explores the CPTPP’s achievements and deficiencies to enhance marine environment protection from four aspects: flags of convenience, the vague role of coastal states, affecting trade or investment, and dispute resolution. It adds proposals to address the deficiencies. It concludes by assessing the broader potential for using FTA dispute resolution processes to assist in ensuring compliance with inter-linked treaties, especially for the Asia-Pacific region.

[xxiii] Strong, S.I., The Role of Empirical Research and Dispute System Design in Proposing and Developing International Treaties: A Case Study of the Singapore Convention on Mediation (February 11, 2019). 20 Cardozo Journal of Conflict Resolution __ (anticipated 2019). Available at SSRN: https://ssrn.com/abstract=3332503

[xxiv] Abstract: This chapter seeks to provide insights into the “black box” of early treaty-making processes by undertaking a case study of the development of the United Nations Convention on International Settlement Agreements Resulting from Mediation (the Singapore Convention on Mediation). The discussion focuses on several issues that have seldom been discussed in the legal literature, including the way in which a proposal for an international treaty makes its way to the relevant decision-makers and how those decision-makers determine which of the various alternatives to pursue. In so doing, the article focuses particularly on the role that dispute system design (DSD) and empirical research played in the early development of the Singapore Convention on Mediation. The analysis also considers how interested individuals can assist the treaty-proposing process, particularly if they are not NGO members. The chapter concludes with implications for international dispute resolution policy development and treaty-making, including for the Asia-Pacific region.

Comparing Consumer Product Safety Law for New Markets and Technologies

In the context of changes in the consumer marketplace and regulatory frameworks locally and internationally, the Australian government is re-initiating public consultations about introducing an EU-style “General Safety Provision”. Although this requirement for suppliers pro-actively assess risks and put or keep only safe products products has also been introduced beyond Europe in Hong Kong, Macau, Malaysia and (partly) Singapore, it has also not yet been introduced in Japan. However, Japan may have a better regulatory framework in other respects (eg mandatory accident reporting requirements on suppliers that extend to some “near misses”, along with public disclosure of such reports) and better enforcement (eg of mandatory safety standards for specific products).

Japanese courts also continue to generate more case law applying EU-style strict product liability, introduced by a 1994 Act, compared to an analogue introduced in 1992 in Australia (and increasingly in other parts of Asia, including many ASEAN states). This helps promote and clarify more indirect incentives on suppliers to source and provide safe products. However, such impact for product liability litigation is still constrained by issues such as effective access to justice / courts. This is evident from a recent book examining major EU and some other countries, reviewed below for the Journal of European Tort Law: Piotr Machnikowski (ed) European Product Liability: An Analysis of the State of the Art in the Era of New Technologies (Intersentia, Cambridge, 2016, ISBN 978-1-78068-398-0, ix+705pp):

This is a very useful reference book especially for academic researchers and legal practitioners, but also policy-makers or law reformers, as it compares product liability law and practice across 12 countries in Europe as well as five other countries. A key question is whether the 1985 product liability (PL) Directive (85/374/EEC), compensating consumers for physical harm as well as certain consequential property losses caused by product safety defects, remains “fit for purpose” – especially given the proliferation of new technologies.

The Introduction by Machnikowski succinctly outlines those as including: mobile internet (smartphones, tablets etc), the automation of knowledge work, the “internet of things” (such as connected home appliances), cloud technology, advanced robotics, autonomous vehicles, next-generation genomics and regenerative medicine, advanced materials (eg through nanotechnology), energy storage, advanced oil and gas exploration and recovery, renewable energy sources, and 3D printing (pp3-8). He explains how these technologies require us to reconceptualise the role of substantive private law, as they often have global reach and prompt calls for public regulation. The new technologies also strain the capacity of the legal system to respond quickly and effectively. They often implicate intellectual property and services rather htan movable or tangible products, and networks of suppliers rather than just manufacturers and some specified intermediaries, as primarily envisaged by the PL Directive. The new technologies raise questions about its focus on product defects linked to physical safety (rather than infringements of privacy or non-economic rights and interests), the exemption from liability usually provided for “development risks” (the no-one-could-have-known defence), attributing causation, and the scope of (potentially catastrophic) damages claimable. The book therefore aims to analyse how conventional PL law is or could be addressing such questions, as well as how PL law interacts with other areas of tort law and public regulation (pp 8-13).

The volume compares the law of European Union member states selected from both the “Old” and “New” Europe (Austria**, the Czech Republic, Denmark*, England*, France**, Germany**, Italy*, the Netherlands*, Norway*, Poland and Spain) and the European Economic Area (Norway) as well as Switzerland. It therefore reviews legal systems in the “Roman, German, common law and Nordic traditions”, along with “two important common law traditions from outside Europe (USA** and Canada*) as well as two mixed jurisdictions (Israel* and South Africa” (pp 13-14). The back cover blurb adds that this hefty book “is the result of an extensive international research project funded by the Polish National Science Centre. It brings together experienced scholars associated with the European Group on Tort law (EGTL) and the European Research Group on Existing EC Private Law (Acquis Group) … The country reports show that the practical significance of product liability differs widely in the various Member States”.

The preceding paragraph above tries to give a sense of this variable significance of PL law by indicating with an asterix (*) or double asterix (**) those countries where there is respectively extensive or very extensive litigation and case law; those without any asterix are countries where lawsuits reportedly remain rare. This rough appraisal is derived mainly from each country report’s concluding Part X (Assessment of Domestic Law), except for the chapter on Spain (lacking Part X), as well as each chapter’s respective Part IX (Alternative Regulations and Remedies) and Part VIII (Procedural and Evidential Issues). The comparison reinforces the well-established general proposition that it is factors beyond reforms to substantive PL law, even the shift from negligence-based to strict liability under the 1985 Directive model (inspired by some earlier US case law), which primarily generate lawsuits and therefore case law that might offer more guidance on what constitutes appropriate safety for consumer products.[1]

The country reports identify (sometimes overlapping) factors arguably impacting on whether or not PL law is extensively litigated:

  • effectively enforced public regulation preventing harmful products coming on the market (also in Norway, per Askeland, p 375), and strong social welfare or insurance schemes (eg in Denmark, per Holle and Mogelvang-Hansen, pp 171-2);
  • expenses in accessing evidence, and lawyers open to contingency fees, compared to non-legal dispute resolution avenues (in England, per Oliphant and Wilcox, p 203);
  • linking of civil with criminal proceedings to ease plaintiffs’ evidentiary burden (in France, per Borghetti, p235);[2]
  • scope of claimable damages (with lawsuits under PL Directive implementing legislation only really since a 2002 amendment allowing claims also for pain and suffering in Germany, per Magnus, p 272);
  • reversed burden of proof under still more familiar Civil Code negligence provisions in Italy, per Comande, pp 307-8);
  • quite predictable law (facilitating settlements), business reputation, products (like mobile phones) bundled with services facilitating claims against direct suppliers rather than manufacturers (in the Netherlands, per Keirse – but noting that general tort law has also become stricter: pp 355-6);
  • unpredictability in civil processes and litigation outcomes due to limited legal aid, variability in lawyers’ fees, high litigation costs, the “loser pays principle”, complex and lengthy procedures, problems with experts and judicial methodologies, and unclear standard of proof (p 404, per Baginska);
  • “almost impenetrable” commentary with very limited case law (in Switzerland, per Winiger, pp 477-8);
  • potential claims versus regulators and perhaps related compensation schemes, as well as class actions (in Canada, per Arbour, pp 513-9);
  • no-fault liability schemes precluding personal injury claims for defects in automobiles, and comparative ease of suing actors (eg doctors or employers) than manufacturers of potentially unsafe products (in Israel, per Gilead, p 544).

Each country report also succinctly sets out Parts dealing with “Sources of Law”, “Basic Elements of Liability”, “The Person Liable for Damage”, “The Aggrieved Person and Damage”, “Causality”, “Defences and Exclusions”, and “Remedies”. This structure facilitates easy comparisons on points of interest (eg on the extent to which an intermediate supplier might have contributed sufficiently to be deemed a joint “manufacturer”[3]), although it would have been helpful for the book to add an Index.

Especially for the (many) countries where case law is sparse, the country reporters do not delve into great detail about the potential applicability of especially Directive-based PL law to the various new technologies (but see Austria, per Koch, p 147). However, in his Conclusions, Machinowki nonetheless includes a very interesting analysis that can be seen as challenging the “Adequacy of the European Product Liability Regime for Threats Posed by New Technologies”, focusing on what should now constitute a “product”, “defect”, “development risks”, the “entity liable for composite products”, and appropriate “time limits”, as well as generally the “possible development paths for product liability law” (pp 691-705). Readers familiar with PL law could perhaps begin the book here, at the end. For particular points of interest, they can cross-reference to the detailed and authoritative commentary on the “Product Liability Directive” itself (pp 17-108) co-authored by Fairgrieve, Howells, Machinowski and five others. That will also be essential background reading for those less familiar with PL law. Academics and policy-makers, rather than practitioners, may also find some related insights in the penultimate chapter by Faure, setting out a rather general “Economic Analysis of Product Liability” (pp 619-65).


Overall, this is a very well conceived and executed comparative reference book that can be highly recommended, especially for those interested in PL law in the context of proliferating new technologies. A second edition or companion volume might usefully extend the analysis to other European countries as well as those, especially in the Asian region, that have increasingly adopted the PL Directive approach – often with more pro-plaintiff innovations.[4] However, other than Japan and Australia to some extent, these Asian countries have so far even less case law and related commentary that may help guide them as well in addressing emergent consumer product safety issues.

[1] Matthias Reimann, “Liability for Defective Products at the Beginning of the Twenty-First Century: Emergence of a Worldwide Standards?”, 51 American Journal of Comparative Law, 751-38 (2003). For a recent illustration, showing almost no lawsuits filed in five Southeast Asian countries that have adopted Directive-style PL legislation, except in Thailand thanks to contemporaneous  legislation facilitating consumer claims through regular courts, see Luke Nottage and Sakda Thanitcul, “Economic Integration and Consumer Protection in Southeast Asia: ASEAN Product Liability Law and Safety Regulation” in ibid (eds) ASEAN Product Liability and Consumer Product Safety Law (Winyuchon, Bangkok, 2016), available via https://ssrn.com/abstract=2703130.

[2] On the synergies between civil and criminal proceedings in medical malpractice and (especially mass tort) PL claims in Japan, see also respectively Robert Leflar, “Medical Error as Reportable Event, as Tort, as Crime: A Transpacific Comparison” 22 Journal of Japanese Law 39-76 (2005) available at https://www.zjapanr.de/index.php/zjapanr/article/view/478/503; and Luke Nottage, Product Safety and Liability Law in Japan (Routledge, 2004) especially ch3.

[3] See a class action settlement regarding imported soy milk, approved by the Victorian Supreme Court, which might have had otherwise to rule on this point under either Australian or Japanese law (both incorporating variants of the PL Directive since the early 1990s): Erin Downie v Spiral Foods Pty Ltd and Others [2015] VSC 190, available at http://www.austlii.edu.au/cgi-bin/viewdoc/au/cases/vic/VSC/2015/190.html.

[4] See also Luke Nottage, Justin Malbon, Jeannie Paterson and Caron Beaton-Wells, ASEAN Consumer Law Harmonisation and Cooperation (Cambridge University Press, Singapore, 2020) especially ch3; Geraint Howells, Hans Micklitz et al (eds) Consumer Law in Asia (Cambridge University Press, forthcoming 2021).

New Frontiers in International Arbitration for the Asia-Pacific Region (6): 15 November symposium @USydney

As part of a research project jointly funded by HKU and USydney over 2019 (see background and many related postings via https://japaneselaw.sydney.edu.au), Sydney Law School will host a second symposium on Asia-Pacific business dispute resolution, all day on 15 November (the Friday before Australia Arbitration Week, this year in Brisbane), with support from CAPLUS, SCIL, TDM and various other ADR or international law related organisations. Registration and speaker bios are here, and presentation Abstracts and/or online publications are being uploaded below. During refreshments following symposium presentations and panel discussions, there will also be a book launch of Vivienne Bath and Gabriel Moens, Law of International Business in Australasia (Federation Press, October 2018).

Challenges and opportunities for Asia-Pacific international commercial arbitration symposium

15 November 2019

Building on Reyes & Gu (eds), The Developing World of Arbitration: A Comparative Study of Arbitration Reform in the Asia-Pacific (Hart, 2018), this symposium examines more recent challenges for international commercial arbitration (ICA), especially the proliferation of international commercial courts, the 2018 UN Convention on enforcement of mediated settlement agreements, and dispute resolution for the Belt & Road initiative. The main focus is on Hong Kong and Singapore (competing jurisdictions in the top “Stage 4” for ICA venues, as identified by Reyes & Gu), Australia (a “Stage 3” venue), China and Japan (“Stage 2” venues).

The symposium will also compare approaches in these jurisdictions to investor-state dispute settlement (ISDS). Building on Chaisse and Nottage (eds) International Investment Treaties and Arbitration Across Asia (Brill, 2018), participants will chart evolving treaty practices and high-profile ISDS cases (including eg in Indonesia), assess whether these do or might impact on public attitudes even towards ICA or other forms of arbitration, and explore alternatives or complements to ISDS.

Speakers:

  • Professor Shahla Ali, University of Hong Kong
  • Professor Vivienne Bath, University of Sydney Law School
  • Adj Prof Max Bonell, Henry Williams Lawyers & Sydney Law School
  • Professor Simon Bronitt, Dean, Sydney Law School
  • Professor Simon Butt, University of Sydney Law School
  • Professor James Claxton, Kobe University
  • The Hon Dr Clyde Croft AM SC, Supreme Court of Victoria
  • Daniel Forster, Clifford Chance & University of Sydney Law School
  • Dr Benjamin Hayward, Monash University
  • Brenda Horrigan, ACICA President & Herbert Smith Freehills
  • Dr Jeanne Huang, The University of Sydney Law School
  • Wilson Mbugua, University of Hong Kong
  • James Morrison, ACICA & Morrison Law
  • The Hon Kevin Lindgren AM QC FAAL, formerly Federal Court of Australia (in lieu of Roger Gyles AO QC, ABA rapporteur for inquiry available via https://austbar.asn.au/singapore-2019/papers)
  • Professor Luke Nottage, University of Sydney Law School
  • Jonathan Redwood, Banco Chambers
  • Yi Tang, University of Hong Kong
  • Dr Nobumichi (Nobu) Teramura, University of Adelaide
  • Professor Leon Trakman, UNSW
  • Professor The Hon Marilyn Warren AC QC, former Chief Justice of the Supreme Court of Victoria

VIEW THE DRAFT PROGRAM (as at 9 August 2019; update via Registration webpage)

ABSTRACTS:

Ali, Shahla, “ICA and ISDS Developments in Hong Kong in the Context of China’s Belt and Road Initiative” (September 13, 2019). Available at SSRN: https://ssrn.com/abstract=3453061
This article examines the impact of both the Belt and Road Initiative and the UNCITRAL Model Law on International Arbitration (the Model Law) on both international commercial and investor state arbitration practice in Hong Kong. Given the significance of Hong Kong as a gateway to OBOR project financing and logistics, understanding current dispute resolution policy is critical for gaining insights into China’s approach to the resolution of OBOR disputes. Measures taken to modernize the practice of arbitration including training programmes and legislative reforms are examined with a view to gaining insights into challenges and future developments.

Claxton, James M. and Nottage, Luke R. and Teramura, Nobumichi, “Developing Japan as a Regional Hub for International Dispute Resolution: Dream Come True or Daydream?” Journal of Japanese Law, Issue 47, 2019; Sydney Law School Research Paper No. 19/01. Available at SSRN: https://ssrn.com/abstract=3299097
The Japanese government, supported by various stakeholders, has recently been attempting to develop Japan as another regional hub for international business dispute resolution services. Tracking this development is important for both theoretical and practical reasons. How it unfolds should reveal which of various theories for explaining Japanese law-related behaviour have more traction nowadays. Assessing the new initiatives is also important for legal practitioners and others interested in the practical question of where to arbitrate or mediate cross-border business disputes. This paper therefore reports on current attempts to promote existing and new international arbitration centres in Japan as well as the recent establishment of the Japan International Mediation – Kyoto, in the context of intensifying competition from other regional venues for dispute resolution services. [Our presentation also updates on the Japan-Korea trade and investment tensions that escalated from mid-2019, and the various dispute resolution options that could be engaged.]

Teramura, Nobumichi, Luke Nottage and James Morrison, “International Commercial Arbitration in Australia: Judicial Control over Arbitral Awards” (updated June 2019)
Geographical remoteness has not prevented Australia from pursuing its ambition to become a major hub for international commercial arbitration (ICA). While regional competitors in the Asia-Pacific region such as Singapore and Hong Kong have already achieved great success in the arbitration world, Australia’s ‘Tyranny of Distance’ requires extra efforts to attract ICA cases. Recent marketing from the Australian government emphasises (1) a harmonised legal framework for ICA in line with international standards; (2) sophisticated arbitration institutions; and (3) some of the world’s leading arbitration practitioners.
While these factors do reveal strong potential to attract ICA cases, to ensure that this goes beyond a mere possibility, the Australian government and judiciary are making quite concerted broader efforts. The former has recently become more vigorous in marketing Australia-based ICA in and out of the country. The latter has generally tried to issue pro-arbitration judgments particularly over the last ten years, and in public speeches or publications leading judges have been actively summarising and promoting Australian developments both domestically and world-wide. However the court system has structural problems, due to the shared ICA jurisdiction of State and Territory Courts alongside the Federal Courts, compared to the unitary system in Hong Kong and Singapore. There are also persistent delays in court-related ICA matters under the IAA, even in the Federal Court of Australia. Nonetheless, perfection is never attainable.
The rest of this paper argues that Australia has significantly improved legal environment for ICA in line with international standards, focusing on the main topics identified for a wider cross-jurisdictional research project: (1) arbitrator bias; (2) conflicts of interests; (3) procedural irregularities and arbitrator’s misconduct during proceedings; (4) arbitrability (objective arbitrability) (5) judicial interpretation of arbitration clauses (subjective arbitrability); and (6) enforceability of arbitral awards (especially regarding public policy).

Nottage, Luke, “Confidentiality versus Transparency in International Arbitration: Asia-Pacific Tensions and Expectations” (August 29, 2019) Sydney Law School Research Paper No. #19/52, August 2019. Available at SSRN: https://ssrn.com/abstract=3444692

Both Australia and Japan lie geographically on the periphery of the Asian region, where international arbitration has been burgeoning especially over the last 15 years. Both countries have struggled to attract significantly more arbitration cases, despite quite extensive efforts (especially by Australia); most cases still go to Hong Kong, Singapore and (especially where local parties are involved) China. This is despite increasingly strict confidentiality obligations being introduced through the rules of the major arbitration institutions, and/or legislation, in Japan and especially Australia. Although aiming to meet the usual expectations of businesspeople and their legal advisors in international commercial dispute resolution, these changes may be “too little, too late”. By contrast, transparency obligations have been added increasingly around the investor-state dispute settlement (ISDS) option included in almost all investment treaties concluded respectively by Australia and Japan. This tendency arguably reflects growing concerns about the public interests implicated by ISDS cases (especially in Australia). Australia has gone the next step of revising its legislation in 2018 to automatically exempt some investment treaty arbitrations from the confidentiality obligations otherwise imposed by default on parties and others in Australia-seated international arbitration proceedings since 2015. Japan does not need to, because its legislation does not apply confidentiality to arbitrations by default. This paper explores possible tensions between these two trajectories in each country. The lessons may be particularly interesting for other jurisdictions (perhaps like Italy) interested in how best to promote and attract international arbitration cases amidst evolving expectations in business and wider communities. The tensions may also influence the EU’s ongoing negotiations for investment protection treaties with respectively Australia and Japan.

Hayward, Ben, “Arbitration in Australia – Efficient, Effective, Economical? A Retrospective”
On 4 December 2009, Australia’s arbitration profession met in Melbourne for a conference hosted by ACICA – the Australian Centre for International Commercial Arbitration – Australia’s leading international arbitral institution. The conference was titled ‘International Commercial Arbitration: Efficient, Effective, Economical?’ – reflecting efficiency, effectiveness, and economic viability’s status as important concerns held by the profession.  Australia’s arbitration laws have been amended many times since then, with a number of significant cases also having been handed down since that time.  One decade later, it is an apt time to ask whether post-2009 developments in Australia’s arbitration laws have addressed these three concerns, and if so, to what extent.  This is the analysis undertaken by this project, which draws upon ten years of developments in Australian arbitration law to identify implications for future law reform in this area.

Warren, Margaret and Croft, Clyde, “An International Commercial Court for Australia: An Idea Worth Taking to Market”

[Extracted from Conclusion of the draft paper:] When the significant trade agreements negotiated by the Federal government are considered with respect to Asia, especially China, and the Pacific, the opportunities offered by an Australian international court are almost boundless. Indeed, there is a symmetry in the establishment of an Australian court which would complement the trade agreements. The proposal for an international commercial court for Australia cannot be left to the Courts themselves or the legal profession to develop and agitate. The experiences of Singapore, Dubai, Abu Dhabi, and indeed, London demonstrate that it is vital for there to be government interest and support for such a proposal.

It is also important to be reminded that a proposal for an Australian court occurs within an international context [… including also] an important legal institute … established in the Asian region in which Australia is an active participant: The Asian Business Law Institute …

A stronger contribution can be made to the rule of law by courts working together than if they are working separately. The early 21st Century is being defined by something of a return to internationalisation and globalisation, although the form and forms that will take remain to be seen. It is for us to shape those forms in the capacity we can and to make contributions towards global stability, harmonisation and due recognition of the law in the context of commercial enterprise. These common purposes, as well as quality of justice and the manner of its administration provided at commercial courts and arbitral tribunals, international and domestic, should be promoted and indeed marketed.

Trakman, Leon “An Australian Perspective on Investment Treaty Negotiations and Investment Arbitration“

Notwithstanding the vision of model Investor-State Dispute Settlement (ISDS) provisions across the international community of states, the obstacles are profound.  Supporters propose a cost-benefit analysis to determine the provisions’ utility.  But states are likely to diverge over the costs and benefits of such a multilateral instrument  Material factors will include the stages of development of the states in issue, the kinds of foreign investors (likely) attracted, and alternatives to investor-state arbitration (including recourse to host state courts). Prospects for a model investment treaty that applies internationally are doubtful at best.  Indeed, states that already have their own models, such as the US and China, agonise over their content when revising them, including in relation to ISDS. 

Notably, too, some (especially developing) states that have lost arbitration claims brought by foreign investors have forsaken ISDS in favour of leaving recourse to domestic courts.  Some Latin American states, such as Ecuador and Bolivia, adopted this position after massive losses to foreign investors from developed countries.  More recently, developed states have displayed wariness of ISDS. Australia, unlike Germany and Canada, has never lost an investor-arbitration claim – including the ISDS claim brought by Philip Morris. But it briefly forsook ISDS arbitration a decade ago under a Labour Coalition Government, partly due to a recommendation of Australia’s Productivity Commission.  A Liberal Government soon reverted to a case-by-case approach towards ISDS, excluding it from a new bilateral treaty with Japan (although ISDS is now available via CPTPP) and PACER Plus, while including ISDS in treaties with Korea, China, and (updated) Singapore. Australia’s most recent but as yet unratified treaties, notably with Hong Kong and Indonesia, also include ISDS.  What is distinctive in these various treaties providing for ISDS is how that choice is expressed.

This presentation will explore ISDS in Australia’s bilateral treaties. It will identify disparate provisions, the manner in which they are manifest, and the reasons for and significance of their adoption.  It will explore some perceived costs-benefits underlying such divergence over ISDS.  It will evaluate the rationale that Australian seeks to shield its outbound investors from the domestic courts of its treaty partner states, while protecting itself from excessive claims by their inbound investors.  It will critically evaluate the proposition that ISDS may be more expeditious and transparent than proceeding before domestic courts.  [For an earlier paper focusing on the Asia-Pacific, see here.]

Tang, Yi, “Applying PRC’s BITs in Hong Kong and Macao SARs: Contradictions Between the Chinese Government and Investment Tribunals”

In recent years, it is observed that the investor-state tribunals have more frequently encountered a difficult problem of the territorial application of investment treaties, especially bilateral investment treaties (BITs). Among all the investment treaty arbitration cases concerning the application of BITs concluded by the People’s Republic of China (PRC), the cases of Tza Yap Shum v Peru and Sanum Investment Ltd v Laos stand out due to the special status of China’s Hong Kong and Macao Special Administrative Regions (SARs). In these two cases, one key dispute is whether PRC’s BITs can be applied to Hong Kong or Macao SARs. And the tribunals and courts in both cases reached the conclusion that PRC’s BITs do apply to Hong Kong or Macao, which has presented a sharp contrast with the Chinese official stance. Against this background, this paper intends to analyze how and why the international investment tribunals’ decisions contradict from the Chinese official position. It will first examine the two controversial cases by teasing out the opposing arguments and standpoints, then it will analyze what might explain the confrontation between the positions held by the Chinese government and the investment tribunals respectively. What are the driving forces behind the two contradictory stances? This paper attempts to conduct a relatively comprehensive analysis on this issue by delving into the reasons from historical, legal, political and economic perspectives. This analysis hopes to offer an innovative prism through which we can gain some new insights into the question of applying PRC’s BITs to SARs. It is also of value to the future implications and policy suggestions as to what China should do to solve the current dilemma, and to prevent future confusion. 

Mbugua, Wilson, “Dispute Resolution in International and Bilateral Investment Agreements” (earlier draft paper with Shahla Ali at: https://ssrn.com/abstract=3168996)

Investor-state dispute settlement (ISDS) claims have mainly centred on impairment of investments by the host state in banking, infrastructure development, mining, among other sectors. Intellectual properties as a form of investments are protected by a considerable number of bilateral investment treaties, however, they have rarely been invoked in ISDS claims until recently. This paper sketches the fabric and the structure ISDS in bilateral investment treaties and how it is applied in practice. Secondly, it will examine how arbitration tribunals have dealt with the subject of intellectual property rights by focusing on two standards of protections- expropriation and fair and equitable treatment. Lastly, the paper will conclude with a discussion on the criticism facing ISDS and possible paths for reforms.   

Huang, Jie (Jeanne), “Data Protection in Investment Arbitration: Privacy, Confidentiality and Transparency“

Two recent cases, Tennant Energy v Canada and Elliott v. Korea, demonstrate that the booming domestic and regional data protection laws have brought real and significant challenges to investment arbitration. The unprecedented but unclear role of data protection in investment arbitration requires serious attention from both academic and practising communities. This paper intends to address four issues. Firstly, how to determine whether an investment arbitration is subject to a domestic or regional data protection law? Second, suppose that a domestic or regional data protection law (e.g. GDPR) should be applied to an ISDS, what are the similarities and differences between the concept of ‘privacy’ under the data protection law and the general assumption that arbitration proceedings are both ‘private’ and ‘confidential’? The third issue is the interplay between the immunity under public international law and the privacy obligation under a domestic and regional data protection law. Last but not least, may the transparency obligation under the UN Convention on Transparency in Treaty-based Investor-State Arbitration (now being considered by the Australian Parliament) conflict with the privacy obligation under a domestic or regional data protection law? If so, how to resolve the conflict?

Guest Blog: Prof Yasuhei Taniguchi on “what characterises Japanese law and legal life”

With kind permission of one of my former teachers at Kyoto University (in international commercial arbitration) and one of Japan’s most eminent jurists, Professor Yasuhei Taniguchi, I reproduce below his succinct and insightful reflections on the historical evolution of Japanese law and society.
This is his Keynote speech delivered on 19 September 2017 at the opening of the LAWASIA conference held at the Hotel New Otani, Tokyo, attended by the Crown Prince and Princess of Japan.
Dr Yasuhei Taniguchi is Professor Emeritus of Kyoto University Law Faculty; Judge of Singapore International Commercial Court; Of Counsel, Matsuo & Kosugi, Tokyo. He was previously a member of the WTO Appellate Body and then a visiting professor at the University of Sydney Law School

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Away on Long-Service Leave for August-December 2017

After 16 years at Sydney Law School, including 168 substantive postings to this Blog since 2008 (listed below), I am taking a real break!
For queries regarding various research projects and publications-in-progress, please contact my research assistant Kirsty Gan: kgan9837@uni.sydney.edu.au
For matters related to the Australian Network for Japanese Law, please contact the ANJeL Executive Coordinator: ana.ubilava@sydney.edu.au (or: anjelinfo@gmail.com)
For updates on next February’s Kyoto / Tokyo Seminars in Japanese Law, please contact: law.offshore@sydney.edu.au
In the unlikely event they cannot deal with your inquiry, they have my private contact details.
Otherwise, you may try contacting me via LinkedIn.com or posting me material to: Sydney Law School, University of Sydney, NSW 2006, Australia. Occasionally I will be clearing my (physical) mailbox there.
I do not plan to check or respond to emails to my USydney or other work-related accounts, except when I am “back on the job” (but overseas) around 4-12 and 16-21 November, and fully from early January 2018.

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Further Fallout from the Fukushima Disasters: Long-term Contract Renegotiation in Japan

A symposium last year discussed “Fukushima Five Years On – Legal Fallout in Japan”, focusing on diverse lessons for the EU, as reported by Ruth Effinowicz in issue 42 of the Journal of Japanese Law. In the same issue, Zina Teoh also analyses “Food Safety in the Aftermath of Fukushima: Who can Consumers Trust?”.
A more recent question arises from an announcement from Tokyo Electric Power Company (TEPCO, operator of the nuclear power plant that suffered the devastating meltdown in after the 2011 tsunami) that it was seeking to terminate its contract with a Canadian long-term supplier of uranium. TEPCO argues that this is justified by the tighter regulatory regime subsequently introduced by the Japanese government, still limiting reactivation of most nuclear plants in Japan. Below is further background, and my quoted response to Bloomberg. I had also mentioned that their chances of legally terminating will depend on:
(i) pricing, termination, force majeure and hardship clauses likely included in the specific contract;
(ii) as interpreted based on the applicable background contract law (hence depending on any express governing law clause), which may in turn also allow recourse to broader background principles such as the doctrines of non-imputable impossibility or “changed circumstances” under Japanese contract law (compared to stricter doctrines of frustration under Anglo-Commonwealth law, as explained in my 2008 article);
(iii) in light also of the dispute resolution forum (with arbitration also likely to be expressly agreed, limiting scope for court review of the arbitrators’ award if a pro-arbitration seat has been chosen).
By way of further background, take a look also at the broader article (prompted by potential disputes over long-term LNG supply contracts due primarily to more fracking in the US ) written by CAPLUS associate Paul Davis, published in issue 38 (2014) of the Journal of Japanese Law.

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Yasuko Claremont et al, Citizen Power: Postwar Reconciliation

Dr Yasuko Claremont recently retired from the University of Sydney’s Japanese Studies Department, but is still actively publishing several works from a major conference and other events held in 2015 to mark the 70th anniversary of the end of the Asia-Pacific War, for a 5-year project on grassroots post-War reconciliation initiatives. (See also her recent translation of a well-known book about the 321 junior high school students killed by the 1945 atomic bombing of Hiroshima.) One event was a photographic exhibition displayed at the University of Sydney library, and Dr Claremont and photograph contributors are now bringing together photographs and commentaries together into a bilingual book entitled “Citizen Power: Postwar Reconciliation”, published by the Oriental Society of Australia, and distributed by Sydney University Press. (Two other volumes will be published by Routledge, and are also very timely given the ongoing sensitivities over the current Japanese government’s new security legislation.) Below are endorsements for the book by Profs Hugh Clarke, Tessa Morris-Suzuki and myself, followed by the Table of Contents.

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Adding a “General Safety Provision” to consumer law in Australia (and Japan)?

Japan enacted in 2006 a more expansive version of mandatory accident reporting compared to the Australian Consumer Law regime implemented from 2011, and currently under review. For example, Japan’s system extends to certain specified risks of harm (currently: carbon monoxide emissions or fires) and allows the regulators to make publically available the incident reports received from suppliers.
However, neither country presently has a General Safety Provision (GSP) requiring all consumer goods placed on the market to be reasonably safe. Given persistent problems with product safety failures in both countries, especially in Australia in recent years, perhaps the time has come. The possible enactment of a GSP has been on the agenda in the first five-yearly “ACL Review”, with last month’s Interim Report picking up several arguments related to product safety regulation made in my initial Submission for the Issues Paper earlier this year from Consumer Affairs Australia and New Zealand. Below is an extract from my second Submission (dated 22 November) also available online.

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