Edited by Jürgen Basedow, Giesela Rühl, Franco Ferrari and Pedro de Miguel Asensio
I. Sources of private international law
1. Major legislation
The main source of choice-of-law rules in Japan is the Act on General Rules for Application of Laws (Hō no Tekiyō ni kansuru Tsūsoku-hō, as newly titled and amended by Act No 78 of 21 June 2006, henceforth PILA). The PILA entered into effect on 1 January 2007, replacing the Hōrei, an act adopted in 1898 (Law No 10 of 1898). The new PILA contains 43 articles which cover choice-of-law rules for personal status, contracts, torts, rights in rem and other non-contractual claims, as well as matrimonial issues.
In May 2011, the Parliament of Japan amended the Japanese Code of Civil Procedure (Act No 109 of 26 June 1996, as amended, henceforth CCP) and introduced specific rules on international jurisdiction in 11 newly added provisions (art 3-2 – art 3-12 CCP). These new rules mainly rest upon pre-existing Japanese court practice, although recent international developments were also taken into consideration. For the recognition of foreign judgments, art 118 CCP is the key provision, while the enforcement of foreign judgments should satisfy the requirements in p. 1art 24 of the Civil Execution Act (Act No 4 of 30 March 1979).
2. International conventions
Japan started to send its representative to meetings of the →Hague Conference on Private International Law in 1902. After the organization became a permanent intergovernmental organization in 1955, Japan became a Member State in 1957. Since then, Japan has ratified the following seven Conventions adopted by the organization: the Hague Civil Procedure Convention (Hague Convention of 1 March 1954 on Civil Procedure, 286 UNTS 265), the Hague Child Maintenance Convention 1956 (Hague Convention of 24 October 1956 on the Law Applicable to Maintenance Obligations towards Children, 510 UNTS 161), the Hague Legalisation Convention (Hague Convention of 5 October 1961 abolishing the Requirement of Legalisation for Foreign Public Documents, 527 UNTS 189), the Hague Testamentary Dispositions Convention (Hague Convention of 5 October 1961 on the conflicts of laws relating to the form of testamentary dispositions, 510 UNTS 175), the Hague Service Convention (Hague Convention of 15 November 1965 on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters, 658 UNTS 163), the Hague Maintenance Applicable Law Convention 1973 (Hague Convention of 2 October 1973 on the law applicable to maintenance obligations, 1056 UNTS 204) and the Hague Child Abduction Convention (Hague Convention of 25 October 1980 on the Civil Aspects of International Child Abduction, 1343 UNTS 89).
Two of these seven Conventions – the Hague Testamentary Dispositions Convention and the Hague Maintenance Applicable Law Convention 1973 – were transformed as national legislation. Some Conventions in other fields than private international law contain provisions on the choice of applicable law, such as the Nuclear Supplementary Compensation Convention (Convention on Supplementary Compensation for Nuclear Damage of 12 September 1997, INFCIRC/567; art 13 (exclusive jurisdiction) and art 14 (applicable law)). Japan has signed no bilateral or regional treaty in the field of private international law.
In the related areas, Japan has recently ratified two important UN Conventions, ie the CISG (United Nations Convention of 11 April 1980 on Contracts for the International Sale of Goods, 1489 UNTS 3) and the UN Convention on Jurisdictional Immunities of States (United Nations Convention of 2 December 2004 on Jurisdictional Immunities of States and their Properties (UN Doc A/59/508)). The latter was transformed as the Act on the Civil Jurisdiction of Japan with respect to a Foreign State, etc (Act No 24 of 24 April 2009) in 2009.
3. Role of case-law and doctrinal writing
Japan belongs to civil law countries, where legislation is the major source of law. But court judgments play an important, de facto a crucial, role in the development of Japanese law in various fields. Private international law is no exception. Court judgments have clarified the meaning of the abstract language of the legislation or filled lacunae in the legislation. However, since the number of reported cases in the field of private international law is limited, compared to substantive contract law or tort law, doctrinal works have contributed to such clarification or filling of lacunae, especially at the early stage of the development of private international law in Japan. Although it is extremely rare in Japan for courts to cite doctrinal works in their judgments, judges usually conduct careful research on doctrinal works related to the issues of specific cases that they have to handle.
II. History and development of private international law
The first legislation on private international law was the Hōrei, an act modelled after German law and adopted in 1898. Legislative change did not occur, until the act was largely amended in relation to matrimonial and parent–child relationships in 1989. But doctrines have been constantly developed. Studies on academic debates and case-laws in Europe and the USA contributed to this development. Such academic contributions were made possible by members of the Japanese Society of International Law (established in 1897) and the Private International Law Association of Japan (founded in 1949).
The voices of various stakeholders were reflected in the new legislation. For example, a strong demand to avoid changes in the practice of the family register was well reflected in the amendment of the Hōrei in 1989. Also, the p. 1PILA, which replaced the Hōrei in 2007, reflects not only academic debates, but also case-law and the voices of industry.
III. Administration of private international law
Needless to say, courts – which include the Family Court – are the main institutional users of private international law. Parties who claim to apply a foreign law in litigation do not have to prove contents of foreign law, since the principle of iura novit curia applies to foreign law as well.
Some professions require knowledge of private international law as well – for example, administrative scriveners who prepare documents to be submitted to various administrative authorities, such as documents to obtain permission for the immigration or employment of foreign workers.
IV. Basic principles of jurisdiction
1. General principles of exercising jurisdiction
The old choice-of-law statute (Hōrei) also contained a few jurisdiction provisions related to personal capacity. Besides that, there were no special provisions determining court jurisdiction to hear cross-border disputes. No international treaty concerning jurisdiction has been signed so far. The Japanese Code of Civil Procedure, adopted in 1890 on the basis of the German Code of Civil Procedure (Zivilprozessordnung of 30 January 1877, RGBl. 83, as amended) only contained rules allocating territorial jurisdiction among the courts within Japan. Hence, the main principles of international jurisdiction were gradually developed in court practice by the Japanese courts.
On 16 October 1981, the Supreme Court (Minshū, vol 5, No 7, p 1224) held that in the absence of clear provisions for the adjudication of cross-border disputes, jurisdictions on cross-border cases should be determined in light of the principle of jōri (reasonableness, justice). And as its substance, rules on domestic jurisdiction envisaged in the CCP have to be applied by analogy. This was criticized for its rigidness. Hence, lower instance courts developed a test whether special circumstances existed, under which Japanese courts could decline jurisdiction even if there was a local jurisdiction venue. Such special circumstances could include that exercising Japanese courts’ jurisdiction would unjustifiably undermine the interests of one party or that there would be problems related to the collection of the evidence (→Evidence, procurement of). This approach was also upheld by the Supreme Court of Japan on 11 November 1999 (Minshū, vol 51, No 10, p 4055).
In May 2011, as stated above, provisions on international jurisdiction were introduced in the CCP. The new CCP establishes defendant’s domicile as the main ground of jurisdiction (art 3-2 CCP; →Domicile, habitual residence and establishment). It is generally agreed that the defendant’s domicile rule properly balances the interests of the parties (actor sequitur forum rei). If the defendant has no domicile or his or her domicile is unknown, Japanese courts have international jurisdiction if the person against whom the action is brought has his or her residence in Japan. The notion of ‘domicile’ should be interpreted in light of art 22 of the Japanese Civil Code (Act No 89 of 1896) as meaning long-standing contacts with Japan, whereas ‘residence’ implies temporary relationships with Japan. As for actions against legal entities, art 4(4) CCP stipulates that such actions shall be brought before courts where the legal entity has its principal office or principal place of business. If the place of the office or business is not known, the action can be also brought before a court of the place where the representative or person in charge of the business has his or her domicile.
Articles 3–9 CCP codified the special circumstances test developed in the court practice. According to this provision, Japanese courts have the discretion to decline international jurisdiction over either part of or the whole action if it appears that there are some special circumstances affecting the fairness between the parties or the prompt and speedy adjudication of the dispute. It should be noted that the special circumstances test could also be applied when a Japanese court has to decide how to deal with parallel proceedings pending abroad. Scholarly opinions remain divided as to whether the court should exercise its discretion and stay Japanese proceedings or dismiss the case.
2. Exclusive jurisdiction
Articles 3–5 CCP establish exclusive jurisdiction rules. Japanese courts have exclusive jurisdiction to adjudicate three particular types of disputes which are related to: (i) matters related to corporations, associations or foundations established in accordance with Japanese law; (ii) claims concerning registration and entries p. 1in public registries; and (iii) the existence and effects of intellectual property rights which require registration. The rationale behind this rule is that such actions concern decisions made by Japanese public authorities.
3. Choice-of-court agreements
A rather comprehensive provision was introduced taking into consideration the 2005 Hague Choice of Court Convention (Convention of 30 June 2005 on Choice of Court Agreements, 44 ILM 1294) and the previous practice of the Japanese courts. Subject to the rules on exclusive jurisdiction, parties are allowed to conclude a choice of court agreement (art 3-7 CCP). In order to be valid, choice-of-court agreements must arise out of a specific legal relationship and must be made in writing. Yet, the choice of court agreement is not effective if a chosen foreign court cannot assert jurisdiction according to the forum law or if it is de facto impossible (art 3-7(iv) CCP). Special provisions are also entrenched to protect the interests of consumers and employees (arts 3-7(v) and 3-7(vi) CCP).
4. Jurisdiction over specific matters
Article 3-3(viii) of the CCP deals with multistate tort actions and stipulates that Japanese courts shall have jurisdiction over actions concerning unlawful acts if such acts occurred in Japan. However, in disputes involving distant →torts where the damage occurred in Japan, but the tortious act was committed abroad, Japanese courts may assert jurisdiction only if it could have been generally foreseen that such tortious acts could have effects in Japan. Article 3-3(viii) CCP is a generic rule and applies to all kinds of torts. The suggestion to have special jurisdiction rules for several particular types of torts did not survive drafting negotiations. Hence, Japanese courts will have to exercise their discretion, tailoring art 3-3(viii) CCP on a case-by-case basis.
The CCP is based on the existing practice of Japanese courts. A number of special jurisdiction provisions for particular matters are entrenched in art 3-3 CCP. For instance, the CCP provides that Japanese courts shall have international jurisdiction over actions concerning →contractual obligations, →unjust enrichment or →negotiorum gestio if the →place of performance of the contractual obligation is in Japan or if, according to the law chosen in a contract, the place of performance of the obligation is in Japan (art 3-3(i) CCP). Two additional provisions were introduced to deal with the adjudication of contractual disputes where one party is a consumer or an employee. Japanese courts may exercise jurisdiction over actions brought by consumers who are domiciled in Japan at the time of claim or of the conclusion of consumer contract, or actions brought by employees whose labour functions are performed in Japan (arts 3–4(1) and (2) CCP).
Japanese legislation does not contain special international jurisdiction rules concerning orders for →provisional measures. Yet, the prevailing approach is that in cases where Japanese courts have jurisdiction over the merits of the dispute, or if the subject matter of the dispute is in Japan, Japanese courts should be able to hear the case. Article 12 of the Provisional Civil Remedies Act (Act No 91 of 22 December 1989) was applied by analogy in cases where one party was seeking provisional measures in cross-border disputes. However, in deciding whether to order provisional or protective measures, Japanese courts will take into account whether there are special circumstances (art 3-9 CCP).
5. Joinder of claims
Japanese civil procedure law offers several possibilities to streamline the adjudication of complex disputes. Domestic procedural rules allow the court to join claims which are closely related (art 7 CCP). There are two types of possible joinder: (i) joinder of claims that are ‘objectively’ related (eg different claims between the same parties), and (ii) joinder of claims which are ‘subjectively’ related (ie to sue someone as co-defendant or to be sued as co-defendant). Articles 3–6 CCP codify the established court practice and stipulate that Japanese courts can exercise international jurisdiction over several claims whenever they are competent to hear at least one claim of the action, provided that there is a close connection between the claims of the action. On the other hand, someone could be sued as co-defendant only when rights or obligations as the objective of a claim are based on the legally or de facto same grounds. Consolidation of claims over matters falling under the exclusive jurisdiction of third states is not possible.
V. p. 1Basic principles of choice of law
1. Personal status
The legal capacity of the person (→Capacity and emancipation) is determined under the law of his or her →nationality (art 4(1) PILA). Nationality is the principal →connecting factor in the field of →personal status and matrimonial issues in Japanese private international law. However, if a person has two or more nationalities, the law of the state in which that person is habitually resident should be applied to determine his or her legal capacity. The notion of habitual residence (→Domicile, habitual residence and establishment) was introduced into the Japanese private international law after the reform of the Hōrei in 1989, when some of the Hague Conventions were ratified. However, if one of the nationalities of a person is Japanese, then Japanese law should be applied (art 38(1) PILA). The law of habitual residence should be applied to determine the legal capacity of persons who do not have any nationality (art 38(2) PILA). Furthermore, if a person is a national of a state where different personal laws are applied, then the internal laws of that state should be applied to determine his or her personal status. It should be noted that the PILA does not contain any provisions for the determination of the legal capacity of juridical persons, but the prevailing opinion supports the incorporation theory.
Japanese courts have jurisdiction to adjudicate disputes related to the declaration of disappearance of a person if the last known domicile of the person known to be alive was in Japan or if such disappeared person had Japanese nationality (art 6(1) PILA). In addition, Japanese courts have jurisdiction to hear cases related to the property of a disappeared person if such property is located in Japan and the last known domicile of that person was in Japan, or he or she was a Japanese national.
2. Contractual obligations
One of the fundamental principles of the PILA is →party autonomy, which was already entrenched in art 7 of the Hōrei. This provision uses the notion of ‘hōritsukōi’ to determine the scope of application, which stems from the German concept ‘Rechtsgeschäft’, which can be translated as ‘juridical act’. The notion of ‘juridical act’ is meant to comprise contracts as well as unilateral transactions such as →donation or →trust. Although the PILA does not clearly stipulate that, the contracting parties are allowed to designate the governing law to a part of a transaction (→Depeçage). The prevailing opinion is that parties can choose the law of any state; yet, according to the reports of the drafting group, the choice of non-state law is not enforceable under the new PILA. As for the validity of the →choice-of-law agreement, many Japanese experts have supported the opinion that the →lex fori should be applied. Nevertheless, more recently, there has been growing support to the uniform solution, ie that the validity of the choice-of-law agreement should be subject to the law chosen by the parties.
In the absence of choice, the formation and effects of a juridical act shall be governed by the law of the state with which it is most closely connected (art 8(1) PILA). The most closely connected law is presumed to be the law of the place in which the party performing the characteristic obligation is habitually resident or has its place of business (art 8(2) PILA). In addition, art 8(3) PILA stipulates that where the subject matter of a transaction concerns real property, the law of the place where that property is located (lex rei sitae) shall be presumed to be the most closely connected.
The PILA also specifies that the parties may make a choice of law at the time of transacting and modify it later provided that such change does not adversely affect the rights of third parties (art 9 PILA). Subsequent modification of the governing law does not affect the validity of the juridical act.
Article 10 PILA entrenches a general provision dealing with the law governing formal requirements for juridical acts (→Formal requirements and validity). A juridical act is deemed to be formally valid if it meets the requirements prescribed: (i) by the law which governs the formation of the act; or (ii) the law of the place where the act was done (art 10(1) and (2) PILA). If parties decide to change the governing law according to art 9 PILA, such change cannot affect the formal validity of a juridical act. In cases of transactions entered into by means of telecommunication media, the law of the place where such juridical act is done is deemed to be in the place where the manifestation of intent was dispatched (art 10(3) PILA). The PILA also contains additional provisions on the form of →marriage and →p. 1consumer contracts in respective provisions. As for the form of wills, there is a separate law which stems from the Hague Testamentary Dispositions Convention.
The PILA introduced new choice-of-law rules for consumer and employment contracts in arts 11 and 12. These provisions aim to provide for a more appropriate solution for consumer and employment controversies and provide greater clarity to such issues as the law governing validity and effects of transactions, as well as the application of mandatory provisions.
A consumer contract is defined as a contract between a consumer as individual and a business operator in art 11(1) PILA. Article 11(6) PILA provides for four special situations to which choice-of-law rules for consumer contracts are not applicable, eg when the business did not know the consumer’s habitual residence or failed to identify that the counterparty was a consumer and had reasonable grounds for such misidentification.
Parties to a consumer contract can choose the law of any country to govern their →contractual obligations pursuant to arts 7 and 9 PILA. Nevertheless, art 11(1) PILA reserves the right to the consumer to request to business operator the application of mandatory rules of the state in which the consumer has his or her habitual residence. Such mandatory rules of consumer’s habitual residence shall exclusively apply with regard to the formalities for the consumer contract (art 11(3) PILA). In addition, according to the prevailing opinion, mandatory rules of the forum shall always be applicable regardless of whether they are invoked by the parties or not. In cases where no law is chosen by the parties to a consumer contract, issues related to the formation and effects of a contract shall be determined according to the law of the state of the consumer’s habitual residence (art 11(2) and (4) PILA).
Newly introduced choice-of-law provisions in art 12 PILA deal with employment contracts. Like consumer contracts, parties to an employment contract are allowed to choose the governing law pursuant to arts 7 and 9 PILA. However, regardless of the chosen law, the employee may request the employer to apply the mandatory provisions of the law of the place with which the employment contract is most closely connected (art 12(1) PILA). The PILA also contains a presumption that the law of the place where the work is provided under the employment contract is deemed to be most closely connected (art 12(2) PILA). This presumption also applies to determine the law governing the formal validity of an employment contract (art 12(3) PILA). Hence, the method for the determination of the governing law in the absence of choice remains rather vague, especially when it comes to employment contracts that are performed in multiple places or via digital communication media.
The PILA of Japan does not contain special provisions on mandatory rules in general. This could be explained by the fact that there is no common agreement what rules should actually be understood as ‘mandatory’ and also whether the mandatory rules of third states should be applied or not.
3. Non-contractual obligations
Section 4 PILA deals with the law governing various non-contractual obligations which were introduced on the basis of recent court practice in applying a general lex loci delicti rule of the old Hōrei. Article 17(2) PILA contains a general choice-of-law rule for →torts and provides that the law of the place where the damage occurs should be applied. The place of damage is understood as the place where the direct damage occurred (eg physical injury) and does not include consequential losses such as costs for medical treatment. The drafters of the PILA aimed at balancing legal certainty and case-by-case justice considerations; therefore, an exception to the lex loci delicti rule was introduced, namely, if the place of the damage could not have been foreseen, the law of the place where a tortious act was committed should be applied (art 17(2) PILA).
The PILA also contains two newly introduced special choice-of-law rules dealing with product liability and defamation claims. Claims related to damage caused by defective products are governed by the law of the place where the victim received the delivery of a defective product (art 18(1) PILA). The drafters deemed this so-called ‘market place principle’ as providing a balanced approach which meets the interests of consumers and the manufacturers: manufacturers are usually aware of the places where their products are distributed, whereas consumers are entitled to compensation prescribed by the laws where the damage is sustained. Yet, in order to protect Japanese manufacturers, an additional exception was introduced in art 18(2) PILA, which allows the court to apply to the law of p. 1the manufacturer’s main place of business if the manufacturer was not able to anticipate the place of where the products caused damaged. Bystander liability issues are subject to art 17 PILA. Pursuant to art 19 PILA, the law applicable to claims concerning defamation and damage to reputation are governed by the law of the victim’s habitual residence. This provision was drafted with a particular emphasis on providing a workable solution for infringements of →personality rights which occur in a digital environment. Under the newly introduced rule, the law of victim’s habitual residence would have to be applied even if damage was sustained in multiple countries.
The rules entrenched in arts 17–19 PILA can be displaced if a tort shows a manifestly closer connection to another place (eg if both parties have their habitual residence in the same place or if parties are bound by a contractual commitment (art 20 PILA)). In addition, the new PILA of Japan introduced a possibility for the parties to make an ex post choice-of-law agreement provided that such a choice does not negatively affect the interests of third parties (art 21 PILA). Such an extension of party autonomy to tort disputes was entrenched with an objective to facilitate settlement and curtail avenues for forum shopping (→Forum (and law) shopping). The PILA contains some new provisions which were severely criticized; for example, art 22 PILA codifies the principle of double actionability, despite criticism in the drafting process.
Claims arising from management without mandate (→Negotiorum gestio) or unjust enrichment shall be governed by the law of the place where the facts constituting the cause of that claim occurred (art 14 PILA). In practice, however, there may be situations where both parties are resident in the same state or where they are bound by a contract. The Japanese lawmaker took this into account and introduced a special rule that allows for the application of the law of the place with which such a claim is more closely connected (art 15 PILA). The PILA allows the parties to make an ex post choice-of-law agreement provided that it does not negatively affect the interests of third parties (art 16 PILA).
4. Rights in rem, subrogation, etc
As for the law applicable to real rights, the Japanese PILA follows the lex rei situs principle: real rights to movables and immovables are governed by the law of the place where the object is situated (art 13 PILA). Of note is the judgment of the Supreme Court on 26 September 2002 (Minshū, vol 56, No 7, p 1551), according to which the law applicable to the validity and effects of a patent is the law of the place of registration.
The question of assignment of receivables is regulated only partly in art 23 PILA, which provides that the effects of the assignment of receivables vis-à-vis the obligor (debtor) and other third parties are governed by the law which applies to the assigned receivable. Although it is not clearly stated in the PILA, the assignor and the assignee are free to choose the law governing the contractual aspects of the assignment. The proprietary aspects such as assignability (→Assignability/Assignment of claims) of the receivables as well as the relationship between the assignee and the debtor should be governed by the law governing the underlying receivable. The same principles should apply mutatis mutandis to legal subrogation (→Cessio legis).
5. Matrimonial matters
As was mentioned earlier, choice-of-law rules relating to various family law issues were reformed in the 1989 amendment of the Hōreiand remain essentially the same in the new PILA. The formalities for a →marriage are governed by the law of the place where the marriage is celebrated (lex loci celebrationis). Moreover, the marriage is deemed to be valid if it meets the formal requirements of the law of the state whose national is one of the spouses (art 24(2) and (3) PILA).
→Nationality is the principal →connecting factor in family law-related matters. Formation of the marriage (ie capacity to get married) is governed by the national law of each spouse (art 24(1) PILA). Article 25 PILA determines the law governing the effects of the marriage. The ‘effects’ of the marriage are understood as all matters concerning personal relations between the spouses (eg mutual rights and obligations, legal representations, solidary obligations, agreements between the spouses and sharing of marital expenses). Article 25 PILA entrenches a cascade of connecting factors: in principle, if the spouses’ laws of nationality are identical, it determines the validity and effects of the marriage (para (1)). However, if the spouses’ laws p. 1of nationality are different, then the common law of habitual residence should be applied (para (2)); or, if there is no common habitual residence, then the law of the place which is most closely connected to the husband and wife applies (para (3)). It should be noted that the issue here is not a common nationality or common habitual residence; instead, each spouse’s law of nationality or habitual residence should be identified first, then the laws of both spouses should be examined as to whether they are identical or not.
With regard to →matrimonial property, the PILA allows limited →party autonomy: spouses may designate the law of the nationality or habitual residence of one of the parties, or, insofar as →immovable property is concerned, the law of the state in which that property is located (art 26(2) PILA). The limitation of freedom to designate only the law of one of the spouses’ nationalities or habitual residences is justified by the need to avoid an abuse in the →choice of law. If a foreign law was designated in accordance with such choice-of-law clauses, as long as juridical acts made in Japan or property located in Japan are concerned, matrimonial property under such foreign law may not be invoked against bona fide third parties. In such cases, Japanese law has to be applied (art 26(3) PILA). In the absence of a choice-of-law agreement, the cascade of connecting factors provided for in art 25 PILA must be consulted to determine the applicable law (art 26(1) PILA). If a matrimonial contract is made subject to a foreign law in accordance with art 26(1) or (2) PILA, and if this contract is registered in a registry, it may be invoked against, irrespective of bona fide or not, third parties (art 26(4) PILA).
The cascade of connecting factors entrenched in art 25 PILA ((i) common law of nationality; (ii) common law of habitual residence; and (iii) closest connection) is also applicable when it comes to the determination of the law applicable to divorce, unless one of the spouses is a Japanese national and has a habitual residence in Japan. In the latter case, Japanese law is applicable (→Divorce and personal separation).
The PILA extensively deals with the choice of law for relationships between parents and children. A child is deemed to be born in wedlock if this is the case under the national law of either of the parents at the time of the child’s birth (art 28(1) PILA). If a child is born out of wedlock, the national law of each of the parents at the time of the child’s birth determines their relationship with the child (art 29(1) PILA). Acknowledgement of parentage of a child is governed by the law of the acknowledging parent’s nationality at the time of the child’s birth (art 29(2) PILA). A child acquires the status of a child born in wedlock if the child is legitimate under the national law of one of the parents or of the child at the time of the fulfilment of requirements (art 30(1) PILA). Finally, →adoption is governed by the national law of the adoptive parent at the time of the adoption (art 31 PILA). In the same vein, matters relating to guardianship, curatorship or assistance are governed by the national law of a ward/curator (art 35(1) PILA; →Guardianship, custody and parental responsibility).
6. Public policy
In some cases it may be the case that the application of a foreign law may produce outcomes that are contrary to the →public policy (ordre public) of Japan. In such circumstances, art 42 PILA allows a court to refuse to apply such a foreign law. In general, it is not recommended to generously apply this provision, since it might easily lead to a ‘homeward trend’ to apply forum law.
If the law of nationality of a person should be applicable, but the choice-of-law rule of that country designates Japanese law, Japanese law applies, excluding cases where the applicable law should be identified through a cascade of connecting factors in arts 25 (effects of marriage), 26(1) (divorce) and 27 (matrimonial property) PILA (art 41 PILA). Prevailing opinion tries to interpret this provision in order to limit its applicability.
VI. Recognition and enforcement of judgments
The procedure for the recognition and enforcement of foreign judgments in Japan are governed by art 118 CCP and art 24 of the Civil Execution Act. Pursuant to art 118 CCP, a foreign judgment must meet four requirements in order to be recognized in Japan. First, a judgment whose recognition is sought must be rendered by a court which has jurisdiction from the view of a Japanese court (so-called ‘indirect p. 1jurisdiction’ or ‘mirror theory’). In its judgment of 28 April 1998 (Minshū, vol 52, No 4, p 853), the Supreme Court of Japan noted that the exercise of international jurisdiction of the foreign court must be examined in light of the principle of jōri (reasonableness, justice). The Supreme Court clarified its stance for the first time after the entry into force of the new CCP in its judgment of 24 April 2014 (Minshū, vol 68, No 4, p 389). According to the judgment, foreign courts’ exercise of jurisdiction must be examined in light of the principle of jōri (reasonableness, justice), ‘in principle, referring to provisions on international jurisdiction in the CCP’ from the viewpoint of whether the recognition of the foreign judgment by Japan is appropriate, taking the concrete circumstances of each case into consideration. Thus, it became clear that the provisions in the CCP (art 3-2 – art 3-12) are the primary reference point for the recognition of foreign judgments in Japan.
The second requirement is the →service of documents informing the defendant about the commencement of the proceedings. Japan is a party to two international conventions on service (the Hague Civil Procedure Convention and the Hague Service Convention). Hence, the requirement of service pursuant to art 118(ii) CCP would be fulfilled in documents served according to the formalities prescribed in one of those conventions. Generally, it is sufficient if the service makes the defendant aware of the commencement of the court proceedings and the need to defend himself or herself by providing facts and evidence in the case. In practice, Japanese courts have refused to recognize foreign judgments in cases where the Japanese defendant was served according to the procedural rules of the foreign state, but without any translation of the documents into the Japanese language (eg Tokyo District Court, Hachioji Branch, 8 December 1997 (Hanrei Taimuzu, No 835, p 132)).
The third requirement for the recognition of a foreign judgment is that it should not be contrary to the public policy of Japan. As for procedural public policy, such issues as the service of documents or minimum requirements of due process fall under separate conditions for the recognition and enforcement of foreign judgments (art 118(2) and (3) CCP). Substantive public policy was successfully invoked to prevent the recognition and enforcement of judgments ordering punitive →damages (eg the Supreme Court, 11 July 1997 (Minshū, vol 51, No 6, p 2573)) or foreign judgments which were incompatible with judgments rendered by Japanese courts (concerning a surrogate mother, the Supreme Court, 3 March 2007 (Minshū, vol 61, No 2, p 619)).
The fourth requirement is the existence of →reciprocity between Japan and the state where the judgment was rendered (art 118(4) CCP). According to the judgment of the Supreme Court on 7 June 1983 (Minshū, vol 37, No 5, p 611), reciprocity exists when the same kind of Japanese judgment can have legal effects in a foreign state according to conditions that are not substantially different from the requirements established in art 118 CCP. In practice, Japanese courts have decided that reciprocity exists between Japan and various countries and regions (→Germany, →United Kingdom, →Switzerland, Queensland (Australia), California, Washington DC, →Singapore, →Hong Kong, etc). Nevertheless, Japanese courts have refused to affirm the existence of reciprocity with the People’s Republic of →China.
In proceedings for recognition and enforcement, parties may also invoke other issues. For instance, the notion of a ‘foreign judgment’ subject to recognition and enforcement in Japan comprises any court decision regardless of the name, form or procedure. Japanese courts may recognize court orders which are rendered after the contested proceedings or in the absence of an appearance of the defendant, judgments granted in summary proceedings or judgments concerning the distribution of costs and expenses of litigation. However, neither authentic instruments issued by public notaries nor court orders for provisional or protective measures can be recognized and enforced in Japan. A foreign judgment can be recognized and enforced if it is final and binding, which means that a judgment must not be subject to any further forms of judicial review and must be valid in the state of origin.
Arbitration was stipulated as a part of CCP until 1996. After a transition period, where arbitration was a part of the Act on Public Notice Procedure and Arbitration Procedure, the Arbitration Act (Law No 138 of 2003) was promulgated as a modernized independent law in 2003, based on the UNCITRAL Arbitration Model Law (United p. 1Nations Commission on International Trade Law, UNCITRAL Model Law on International Commercial Arbitration as adopted on 21 June 1985 and as amended on 7 July 2006, UN Doc A/40/17 and A/61/17; →Arbitration, (UNCITRAL) Model Law). Japan has been a state party to the New York Convention (New York Convention of 10 June 1958 on the Recognition and Enforcement of Foreign Arbitral Awards, 330 UNTS 3) since 1961.
There are four important provisions concerning international commercial arbitration (→Arbitration, international commercial) in the Arbitration Act, ie the place of arbitration, applicable law and the recognition and execution of foreign arbitral award.
First, the place of arbitration shall be as specified by the agreements of the parties (art 28(1) CCP). If such an agreement has not been reached, the arbitral tribunal shall specify the place of arbitration by giving regard to the circumstances of the dispute, including the convenience of the parties (art 28(2) CCP). Nevertheless, an arbitral tribunal may, unless otherwise agreed by the parties, conduct the following procedures at any place it finds appropriate: (i) consultation within an arbitral tribunal which is a panel; (ii) hearing of statements of the parties, expert witnesses or third parties; and (iii) inspection of goods or documents (art 28(3) CCP).
As for the law applicable to making an arbitral award, the law which the arbitral tribunal should comply with in making an arbitral award shall be as specified by the agreement of the parties (art 36(1) CCP). In this case, if laws and regulations of a given state have been designated, such designation shall, unless a contrary intention has been clearly indicated, be deemed as designating the laws and regulations of the state which shall be directly applicable to the case, and not the choice-of-law rules of the state. If such an agreement has not been reached, the arbitral tribunal shall apply the laws and regulations of a state which has the closest relationship to the civil dispute that has been referred to the arbitration procedure and that should be directly applied to the case (art 36 (2) CCP). Nevertheless, if a clearly indicated request has been made by both of the parties, the arbitral tribunal shall decide ex aequo et bono (art 36(3) CCP). An arbitral tribunal shall decide in accordance with the terms of the contract pertaining to the civil dispute which has been referred to the arbitral procedure, if such a contract exists, and take into account the usages applicable to the relevant civil dispute, if any (art 36(4) CCP).
As for the recognition of foreign judgments, an arbitral award (irrespective of whether or not the place of arbitration is in Japan) shall have the same effect as a final and binding judgment, although provided that a civil execution based on such arbitral award requires an execution order under the provisions of art 46 CCP (art 45(1) CCP).
However, this shall not apply in cases where any of the following grounds exist (for the grounds set forth in items (i)–(vii), limited to the case where any of the parties has proved the existence of such grounds): (i) the arbitration award is not valid due to the limited capacity of a party; (ii) the arbitration award is not valid on grounds other than the limited capacity of a party pursuant to the laws and regulations designated by the agreement of the parties as those which should be applied to the arbitration agreement (and, if such designation has not been made, the laws and regulations of the country to which the place of arbitration belongs); (iii) the party did not receive the notice required under the laws and regulations of the country to which the place of arbitration belongs (if the parties have reached an agreement on the matters concerning the provisions unrelated to public order in such laws and regulations, such agreement) in the procedure of appointing arbitrators or in the arbitration procedure; (iv) the party was unable to present a defence in the arbitration procedure; (v) the arbitral award contains a decision on matters beyond the scope of the arbitration agreement or of the application presented in the arbitration procedure; (vi) the composition of the arbitral tribunal or the arbitration procedure is in violation of the laws and regulations of the country to which the place of arbitration belongs (if the parties have reached an agreement on the matters concerning the provisions unrelated to public order in such laws and regulations, such agreement); (vii) the arbitral award is not final and binding or the arbitral award has been set aside, or its effect has been suspended by a judicial body of the country to which the place of arbitration belongs (in cases where the laws and regulations applied to the arbitration procedure are laws and regulations of a country other than the country to which the p. 1place of arbitration belongs, such other country) pursuant to the laws and regulations of that country; (viii) the applications presented in the arbitration procedure are related to a dispute which cannot be the subject matter of an arbitration agreement pursuant to the provisions of Japanese laws and regulations; or (ix) the content of the arbitral award is against public policy in Japan (art 45(2) CCP).
In cases where the grounds set forth in item (v) exist, if the part concerning the matters prescribed in said item can be separated from the other parts of the relevant arbitral award, such part and the other parts of the arbitral award shall be deemed to be an independent arbitral award respectively, and the provision of said paragraph shall apply (art 45(3) CCP).
Concerning the execution of an arbitral award, a party who intends to have a civil execution based on an arbitral award carried out may file an application with the court for an execution order (an order allowing the civil execution based on an arbitral award) by specifying the obligor as the respondent (art 46(1) CCP). In filing the application, the party shall submit a copy of the written arbitral award, a document proving that the contents of such a copy are the same as those of the written arbitral award, as well as a Japanese translation of the written arbitral award (excluding those prepared in Japanese) (art 46(2) CCP).
In cases where an application for setting aside the arbitral award or suspending the effect thereof has been made to the judicial body due to item (vii) above, the court to which the application for an execution order has been made may suspend the procedure pertaining to the application. In this case, the court may order the other party to provide security, upon the request of the person who made the application.
The case based on the application for an execution order shall be subject to the exclusive jurisdiction of the courts set forth in art 5 of the Arbitration Act (the district court determined by an agreement between the parties; the district court which has jurisdiction over the place of arbitration; or the district court which has jurisdiction over the location of the general venue of the respondent of the relevant case) or the District Court which has jurisdiction over the location of the subject matter of the claim or the seizable property of the obligor (art 45(4) CCP).
The court may, even where the case based on the application for an execution order is subject to its jurisdiction, upon request or by its own authority, transfer whole or part of the case to another court with jurisdiction if it finds it appropriate to do so (art 45(5) CCP).
The court shall give an execution order, except if it dismisses the application for an execution order set forth in para (1) pursuant to the provisions of the following para or para (9) (art 45(7) CCP).
In cases where the application for an execution order has been made, the court may dismiss such an application only when it finds that any of the grounds set forth in items (i)–(ix) above exist (for the grounds set forth in items (i)–(vii), limited to the case where the respondent has proved the existence of such grounds) (art 46(8) CCP).
Jürgen Basedow, Harald Baum and Yuko Nishitani (eds), Japanese and European Private International Law in Comparative Perspective (Mohr Siebeck 2008);
Jürgen Basedow, Toshiyuki Kono and Axel Metzger (eds), Intellectual Property in the Global Arena: Jurisdiction, Applicable Law, and Recognition of Judgments in Europe, Japan and the US (Mohr Siebeck 2012);
Yuko Nishitani, ‘Internationales Privat- und Zivilverfahrensrecht’ in Harald Baum and Moritz Bälz (eds), Handbuch Japanisches Handels- und Wirtschaftsrecht (Carl Heymanns Verlag 2011) 1211;
Yoshiaki Sakurada and Ewa Schwittek, ‘The Reform of Japanese Private International Law’ (2012) 76 RabelsZ 86;
Koji Takahashi, ‘A Major Reform of Japanese Private International Law’ (2006) 2 J Priv Int L 311;
Junko Torii, ‘Revision of Private International Law in Japan’ (1990) 33 Japanese Yearbook of International Law 54;  Japanese Annual of Private International Law (the whole issue devoted to new rules on international jurisdiction, in Japanese).