WORLD TRADE ORGANIZATION  
ORGANISATION MONDIALE DU COMMERCE  
ORGANIZACIÓN MUNDIAL DEL COMERCIO  WT/TPR/M/211/Add.1 
22 May 2009 
 (09-2487) 
Trade Policy Review Body 
18 and 20 February 2009 Original: English/Spanish 
 anglais/espagnol  inglés/español 
 
 
TRADE POLICY REVIEW 
JAPAN 
Minutes of Meeting
 
Addendum  
Chairperson:  H.E. Mr. Yonov Frederick Agah (Nigeria) 
 
 This document contains the advance writte n questions, and replies provided by Japan.1 
__________________________________________________________________________________ 
Organe d'examen des politiques commerciales 
18 et 20 février 2009  
EXAMEN DES POLITIQUES COMMERCIALES 
JAPON 
Compte rendu de la réunion
 
Addendum  
Président:  H.E. M. Yonov Frederick Agah (Nigeria) 
 
 Le présent document contient les questions écrites communiquées à l'avance et les réponses 
fournies par le Japon.1 
__________________________________________________________________________________ 
Órgano de Examen de las Políticas Comerciales 
18 y 20 de febrero de 2009 
 
EXAMEN DE LAS POLÍTICAS COMERCIALES 
JAPÓN 
Acta de la reunión  
Addendum  
Presidente:  Excmo. Sr. Yonov Frederick Agah (Nigeria) 
 
 En el presente documento figuran las pre guntas presentadas anticipadamente por escrito, 
junto con las respuestas facilitadas por el Japón.1 
                                                      
1 In English and Spanish only./En anglais et espagnol seulement./En inglés y español solamente.   
   WT/TPR/M/211/Add.1 
 Page 3 
 
 
  WRITTEN QUESTIONS BY MEMBERS 
 BRAZIL
 
 
1. Brazil takes note of Japan's statement in document WT/TPR/G/211 that Regional Trade 
Agreements will serve as building blocks to reach higher trade liberalization at the multilateral level 
and that, in doing so, Japan will take into consid eration their possible influences on the WTO system 
and the world economy (paras. 5-6).  In that cont ext, what are the specifi c initiatives Japan foresees 
for the near future in the Latin American regi on, in particular with Mercosur countries?  
 
2. Concerning Agriculture in the Doha Deve lopment Agenda, Japan states in document 
WT/TPR/G/211 that difference in tariff structur es, the multifunctionality of agriculture, and food 
security are taken into account (para. 20).  In what  measure those factors could influence a successful 
outcome of the negotiations that are intended to bri ng liberalization for trade in agricultural products? 
 
3. The Report by the Secretariat (document WT/TPR/S/211) indicates that approximately 99% 
of tariff lines are bound and that non- ad valorem  duties represent 6.7% of all tariff lines.  What are 
Japan's intentions towards binding the totality of its  tariff lines, as well as to fully express them in 
ad valorem  terms, with a view to offering more transp arency and predictability to trading partners? 
 4. In document WT/TPR/G/211, Japan indicates that it has implemented since April 2007 duty-
free and quota-free market access for approximately 98% of products origina ting in least developed 
countries (para 74). What are Japan’s intentions, if any, to extend the product coverage to 100%, and 
in what timeframe?  
WT/TPR/G/211 Paragraph 26 page 09 
 
1. Japan has not mentioned some IP elements  of the TRIPS Council negotiations on outstanding 
implementation under the Doha work programme.  Brazil would like Japan to elaborate on the 
mandated review of Article 27.3(b) and, more specifically, the relationship between the TRIPS 
Agreement and the UN Convention on Biological Diversity (CBD);  as well as the protection of traditional knowledge and folklore.  
 
WT/TPR/G/211 Paragraph 52 page 14 
 
2. Which concrete measures in the field of IP R enforcement does Japan intend to seek under the 
ASEM Trade Facilitation Action Plan?  
 
WT/TPR/G/211 Paragraph 62 and 63 page 17 
 
3. How is IP addressed within the Japan-China  Economic Partnership Consultation?  How does 
such initiative differ from bilateral dialogues with  other partners such as the EC and the US? 
 
4. Brazil would like Japan to provide figures on the patent and trademark backlog of the JPO.   
 5. Brazil would like to know which measures JPO is taking to prevent misappropriation of 
common generic names of the biodiversity through the granting of trademark rights, despite the lack of distinctiveness.   
 
WT/TPR/S/211 SUMMARY OBSERVATIONS, ITEM 4, PARAGRAPH 26 
 
6. "During the review period,  the authorities placed emphasis on the promotion of selected 
industries, for example, additional assistance was introduced for the production of aircraft" WT/TPR/M/211/Add.1 
Page 4  
 
  The Mitsubishi Jet project has received a large cove rage by the press, starting in 2007 and throughout 
2008, including information about financial support from the Government and pre-orders agreed 
between the manufacturer and Japanese air lines.    In March 2008 the Brazilian Embassy formally re quested to be informed, under the rules of 
ASCM/WTO, about the official support program, especially the project known as "Environment-
Friendly, High Performance Small Aircraft" fro m NEDO ("New Energy and Industrial Technology 
Development Organization", linked to the Ministry of  Economy, Trade and Industry of Japan), but no 
answer has been provided.  
Even though the Mitsubishi Jet project is supposed to be completed in few years, since 2003, 
according to the press, this offi cial mechanism of support has been operational.  It might be 
interesting to know whether the Japanese government  envisages to make public such information, 
under the ASCM/WTO, in order to allow its cons istency to be appropriately verified.   
 
The lack of information from the Japanese authorities regarding such an important issue is of great 
concern to Brazil.  Transparency is one of the f ounding principles of the WTO system as a whole, and 
of the SCM Agreement in particular.  Brazil s ees this Trade Policy Review as an opportunity for 
Japan to provide the necessary inform ation to the WTO membership."  
 Can Japan provide a reply to Brazil's queries? 
 
WT/TPR/S/211 Paragraph 35 Page 13   
 
7. Could Japan clarify if among the measures to tackle the crisis is there any which can directly affect the foreign trade, such as the adoption of non- automatic licenses, or the increase of tariff rates.   
 
WT/TPR/S/211, Chapter III, paragraph 20, page 36   
 
8. "(…) In FY2008, Japan unilaterally reduced  applied MFN tariffs on petroleum products and 
industrial alcohol;  for example, the applied MFN rates are 16.9% (20.3% in FY2007) for industrial 
alcohol, and between ¥434 to ¥1,614 per kilolitre for petroleum products." 
 
Enacted in May 2006, the Japanese new policy on Energy allows the use of up to 3% of ethanol on gasoline.  However, the high duties imposed on alcohol reduce significantly its competitiveness 
regarding fossil fuels.  This policy seems to be  in contradiction with the general purpose of a 
"balanced and stable supply of  energy resources" traditionally implemented by the Japanese 
government. 
 Considering the importance it attaches to fulfilling the Kyoto Protocol obligations, Brazil wishes to know whether the Japanese government intends to accelerate the schedule of reduction of tariffs on 
ethanol imports.  The present legislation stipul ates the progressive reduction until 2010 of import 
duties on ethanol imports, although there is no expecta tion of its total elimination. Given the very 
limited capacity of production of ethanol in Japan, Brazil asks whether there is an intention to reduce 
these levies to zero.    
WT/TPR/S/211, CHAPTER III, PARAGRAPHS 26-28, PAGE 40  
 9. Could Japan inform what is the percen tage of agricultural imports conducted under 
preferential rate agreements?     WT/TPR/M/211/Add.1 
 Page 5 
 
 
  WT/TPR/S/211, CHAPTER III, PARAGRAPH 33, PAGE 42  
 
10. Could Japan inform, in terms of the Harmoni zed System, what products are subject to the 
import quotas indicated in the pa ragraph above mentioned?   
 WT/TPR/S/211, Chapter III, paragraph 67, page 51  
 
11. Which Japanese entities are authorized  to issue certificates of origin?  
 
WT/TPR/S/211, Paragraph 87, Page 57 
 
12. Paragraph 87 of document WT/TPR/S/211 stat es that "prevention of the transit of goods 
infringing IPRs is now enforced ex officio by Customs." Brazil would like Japan to clarify the 
amendments to its Customs Law regarding the prev ention of the transit of goods infringing IPRs.  In 
light of which legislation does Japanese Customs judge  the legality of IPRs of goods in transit being 
shipped to third markets?  Is there a possib ility that, according to the Japanese legislation, a 
consignment of goods meant for third markets be deemed illegal for infringement of IPRs in Japan, 
even if the goods are legal in the market where they are meant for?  
 
WT/TPR/S/211, Paragraph 91, page 58  
 13. The Patent Act was amended in order to allo w increased period for filing appeals against an 
examiner's refusal.  Do the amendments provide for increased period for f iling opposition to patent 
requests?    
WT/TPR/S/211, Chapter 4, paragraph 10, page 72   
 
14. "(...) 17,4 % of duties app lied to agricultural goods are non- ad valorem .  More specifically, 
59,6 % (Table  IV.1) of sugar and s ugar confectionery are subject to non- ad valorem  tariffs.  Brazilian 
exports of sugar have been hindered and reduced due to that restriction.  Considering that Japan does 
not produce substantive amounts of sugar, the main result of applying non- ad valorem  duties is an 
unnecessary burden on consumers' prices.  Are there any plans to advance in the tariffication process?   
 
Sugar producers from developing countries are heavily affected by non- ad valorem  duties that are 
biased against low-price competitive exporters.    It might be interesting to know whether th e Japanese government envisages a reform on the 
non-ad valorem  duties imposed on agricultural imports.   
 
WT/TPR/S/211, Chapter IV, Paragraph 12, page 74  
 
15. Please specify the amount and type of subsidies granted to rice producers.  The same paragraph also states that rice, wheat and barley  "remain the most heavily supported commodities". 
Could Japan provide updated information on total subsidies provided for those commodities?    
 
WT/TPR/S/211, Paragraph 23, page 78   
 
16. "(...) The simple average applied MFN tariff for imported industrial products (HS 25-97) is 
3.6% (FY2008), compared with 15.7% for agricultu ral products (HS 01-24).  Simple average tariffs 
are considerably higher for footwear and h eadgear than for other manufactured goods." 
 WT/TPR/M/211/Add.1 
Page 6  
 
  On the other hand, Japanese imports of leather are fr ee from restrictions.  As a consequence, Brazilian 
exports of leather have increased, but Brazilian produ cers of footwear's access to the Japanese market 
have lost market share.    Would the Japanese government inform whet her it envisages any reform on the non- ad valorem  
duties on footwear?  
 
WT/TPR/S/211, Chapter IV, paragraph 25, page 79   
 
17. "(…) Japan also intends to assist the devel opment of manufacturing, including the aircraft 
industry (e.g. the Mitsubishi Rear Jet project)".  
 Please provide details on the policies as they were  not made available by the Secretariat.   
 
WT/TPR/S/211, Chapter IV, paragraph 37, page 84  
 
18. "The centerpiece legislation governing the operation of banks is the Banking Law; the Law 
stipulates that a license is required to operate a bank in Japan…"  The footnote quoted (#44) in that 
paragraph stresses that banks licensed in Japan de pend on ministerial authorization to operate their 
agencies.  Which of the two requirements are co nsidered by Japanese government to allow this 
operation?     
 
WT/TPR/S/211, Paragraph 40, page 85   
 
19. It is stated that "there are no state-owned insurance companies in Jap an."  However, in the 
same paragraph, it is also declared that "the Japan  Post Insurance Co. Ltd is fully owned by...a fully 
state-owned holding company".  Please expl ain this apparent contradiction.  
 
WT/TPR/S/211, paragraph 80, page 55 
 
Please provide further details on the changes made by the Tax Reform for the tax treatment of interest rates received by non-residents. 
 
 
CHINA
 
 
(First batch) 
 
Question 1  
 
Would the Delegation of Japan please share with us  the latest statistics re garding Japan's economic 
growth rate of 2008?  What is the forecast for 2009? 
 
REPORT BY THE SECRETARIAT  
II. TRADE POLICY REGIME:  FRAMEWORK AND OBJECTIVES  
 
(1) 
INTRODUCTION  
 
Question 2 (Paragraph 1) 
Japan established the Expert Committee on FDI Promo tion within the Cabinet Office to replace Japan 
Investment Council, which was abolished on 28 December 2007.   WT/TPR/M/211/Add.1 
 Page 7 
 
 
  Would the Delegation of Japan please elaborate th e organizational structur e and function of the 
Expert Committee on FDI Promotion?   
Question 3 (Paragraph 4) 
The Secretariat Report notes that "Since March 2007, administrative organs have been required to 
conduct ex-ante evaluation of regulations." 
 Would the Delegation of Japan please elaborate th e mechanism and procedure for this "ex-ante 
evaluation"?   III. TRADE POLICIES AND PRACTICES BY MEASURE   (1) M
EASURES DIRECTLY AFFECTING IMPORTS  
 
(i) Standards, and sanitary  and phytosanitary measures 
 
Question 4 (Paragraph 47-65) 
China understands that in Japan, the prefecture gove rnments are responsible for the inspection of 
domestic agricultural products, while imported agricu ltural products are subject to the inspection of 
Ministry of Health.   
Would the Delegation of Japan please explain how it can ensure equal treatment to domestic and 
imported agricultural products in the inspection proce dures, given that they are inspected by different 
government agencies, where different inspecti on methods and approaches might be adopted?  
 
IV. TRADE POLICIES BY SECTOR  
 
(1) SERVICES   
 
(i) Transport Service  
 
Question 5 (Paragraph 59-65) 
Japan committed to open its maritime auxiliary servi ces in its GATS Schedule, yet foreign shipping 
companies are not allowed to conduct port operations directly.  Instead, they are required to register a 
company in Japan to conduct port transaction business.  This requirement creates unnecessary burden and extra operation costs to foreign shipping companies.  
 
a.  Would the Delegation of Japan please explain the rationale for this requirement ?  
b.  Does Japan have the plan to consider removi ng or modifying this requirement with a view to 
facilitating trade? 
 
(Second batch)  
II. TRADE POLICY REGIME:  FRAMEWORK AND OBJECTIVES 
 
Trade Policy Formulation and Evaluation (Chapter II, Paragraph 10-14) 
 
Question 1 
With regard to Table II.1 on Page 17, would the Delegation of Japan please provide copies of the 
following legislations or their summaries in English,  or indicate their reference numbers if they have 
been notified to the WTO?  WT/TPR/M/211/Add.1 
Page 8  
 
  1) The Export and Import Transaction Law (1952 Law No. 299, 2007 amendment), Export 
Control Order (1949 Order No. 378, 2007 amendment), Import Trade Control Order (1949 Order 414, 2003 amendment), Cabinet Order on Inward Direct Investment (1980 Order No. 
261, 2007 amendment)  
2) The Act on Special Measures Concerning the Ha ndling of Legal Servi ces by Foreign Lawyers 
(1986 Order No. 66, 2003 amendment) 
3) Access to the International Trade Insu rance Law (1950 Law No. 67, 2008 amendment) 
4) The Design Act (1959 Law No. 125, 2007 amendment)  
 
III. TRADE POLICIES AND PRACTICES BY MEASURES 
 (1) M
EASURES DIRECTLY AFFECTING IMPORTS  
 
Tariffs (Chapter III, Paragraph 18-29) 
 Question 2 
Japan maintains high tariffs in several agricultura l products, notably seaweeds  (40%) and jam (40%). 
Meanwhile, it also maintains high tariffs in cert ain non-agricultural products such as leather shoes 
(60%).  These tariffs are far higher than the 2007 si mple average tariff rates for agricultural products 
(21.8%) and non-agricultural products (2.6%).   
How does Japan plan to provide more market access on these products, particularly on those of export 
interests to developing Members? 
 
Question 3 
The quota administration system of Japan is complicated which might constitute unnecessary barriers 
to trade.  
China would like to know how quotas are allocated in Japan on the basis of MFN principle? Please 
provide detailed explanations using rice as an example.  Standards, and Sanitary and Phytosanitary  Measures (Chapter III, Paragraph 47-64) 
 
Question 4 
Japan started to implement the "Positive List" Syst em since May 2006.  Japan has claimed that this 
System aims at protecting the interest of domestic consumers.  However, several discriminatory practice in the standards-setting and im plementation have made this System a de facto  technical 
barrier to trade.  
 Only about 10,000 maximum residue limits among the 50,000 limits in the "Positive List" System 
have scientific basis through experiments, and th e other 40,000 "temporary" limits need to be 
transformed into formal standards based on scientific  evaluation.  Japan has committed to finish the 
evaluation of all these standards within five years after the implementation of the System.  
Would the Delegation of Japan please provide the lat est information regarding the evaluation process? 
 Question 5 
Severe discriminatory practices exist in the de velopment of the standards, which constitutes a de facto  
technical barrier to trade.  Generally speaking,  the maximum residue limits are relatively lax for 
products in which Japan has a competitive edge, wh ile for largely imported products, the standards are 
much stricter.  For instance, the maximum residue limit of dursban in cabbages is 1.0 mg/kg, while 
the limit of the same pesticide in garlic is 0.01 mg/kg.  WT/TPR/M/211/Add.1 
 Page 9 
 
 
  Would the Delegation of Japan please explain the rationale for such a disparity in the maximum 
residue limits of the two products? How does Japan justify its compliance w ith the SPS Agreement in this regard? 
 
Question 6 
Japan has claimed that the "Positive List" System  equally applies to both domestic and imported 
products.  However, many Chinese enterprises have  reported that their exports are affected by 
discriminatory implementation of the System.  For instance, the average inspection rate for imported 
products is 10%, while reportedly the inspection rate of domestic products  in Tokyo is less than 1%.  
Furthermore, as long as problems are found in more  than two batches of imported products, all 
imports of the same kind will be subject to a "ma ndatory inspection", while domestic products are not 
subject to this requirement.  
 
Would the Delegation of Japan please explain how these requirements are in consistency with the 
national treatment principle? 
 
Question 7 
Information available to China indicates that Japan pl ans to establish a new law to require enterprises 
engaged in the business of chemical products to re port to the government every year on their output, 
import and usage of chemical materials.  The new law would establish the reporting obligation for 
more than 20,000 chemical materials.  
Could the Delegation of Japan please indicate whether they plan to publicize the draft of the law and 
solicit opinions from relevant enterprises and interested  parties before enactment in order to avoid the 
possible disturbance to trade brought by the new system? 
 
(2) M
EASURES DIRECTLY AFFECTING EXPORTS  
 
(i) Export promotion schemes (Chapter III, Paragraph 73-75) 
 
Question 8 
Paragraph 74 on Page 53 mentioned that "export promotion schemes handled by the Japan External 
Trade Organization (JETRO) include provision of in formation, market and company studies, and 
support for participation at international trade fairs." 
 What kind of measures has this organization adopted to promote services trade? 
 
IV. TRADE POLICIES BY SECTOR 
 
(1) S
ERVICES  
 
(i) Overview (Chapter I and Chapter IV, Paragraph 31-32) 
 
Question 9  
Paragraph 26 on Page 9 mentioned that "the latest revised "Three-Year Plan for the Promotion of 
Regulatory Reform" was issued in March 2008.  The March 2008 revision covers 750 measures on, 
inter alia , healthcare, financial services, labour market , information technology, and education."  
 
Would the Delegation of Japan please provide deta iled information regarding these measures of the 
regulatory reform concerning the services sectors?  WT/TPR/M/211/Add.1 
Page 10  
 
  Question 10 
Paragraph 32 on Page 81 mentione d that "In order to address horizontal issues in services, an 
organization called Service Productiv ity and Innovation for Growth (SPRING) was established by the 
business sector in May 2007."  
Would the Delegation of Japan please provide the fo llowing information about this organization? 
1) Objective for setting up this organization; 
2) Functions of this organization; 
3) Coordination of SPRING with services authorities.  
(ii) Insurance (Chapter IV, Paragraph 33-51) 
 
Question 11 
Regarding limitation on market access in the non- life insurance sector, there is a current limitation 
that "60 per cent of amounts of reinsurance on th e compulsory automobile third party liability 
insurance is subject to the compulsory coverage by the Government."   
Please explain the meaning of "subject to the compulsory coverage by the Government". 
Please explain the rationale behind this requirement. Is there any plan to change this requirement? 
  Question 12 
With regard to limitation on market access in non-life insurance sector, Japan committed that 
"insurance services are not allowed to be supp lied through an intermediary in Japan".  
 
Please explain what this limitation specifi cally means and the rationale behind it. 
 
Question 13 
Under Japan's Horizontal Commitments, Mode 4, concerning the entry and temporary stay of a natural person, Japan committed that "a natural pe rson who has been employed by a juridical person 
of a Member other than Japan for a period of not l ess than one year immediately preceding the date of 
his application  for the entry and temporary stay in Japan...".  
 
China appreciates Japan's commitment in this regard .  However, reports from enterprises indicate that 
the visa application process for staff of insurance companies (as well as natural persons in other 
services sectors) who seek short-term stay for less than one year in Japan is complicated and often 
lacks transparency and certainty.   
Does Japan have any plan to improve its visa administra tion with regard to short-term stay in the spirit 
of promoting the liberalization of trade in services?  Question 14 
China is glad to see that Japan has started to pr omote competition to further liberalize its domestic 
insurance market.  That being said, China ha s learnt from the Report that "at the end of 
September 2007, the top four life insurance companies accounted for 60.6% of total life insurance 
company assets;  and the top eight non-life insura nce companies held 90.3% of the non-life total." 
China believes that this implies a still high level of concentration.  
 China would like to know what exact measures Japan has taken to  encourage competition in the 
financial services sector including insurance, given that  the FDI level in this sector in Japan is still 
low and the number of foreign service-providers in the life insurance sector is still limited.  
  WT/TPR/M/211/Add.1 
 Page 11 
 
 
  Question 15 
China understands that the privatization of Japan  Post commenced in October 2007, and the Japan 
Post Bank and Japan Post Insurance have started operations.  
 
China would like to know the expected role of the new Japan Post Insurance Company in the 
insurance sector and whether the new compan y would enjoy de facto advantageous status , given the 
special status of the Japan Post Insurance. Ltd as a fully owned entit y by the Japan Post Holdings, a 
fully state-owned holding company. 
 
Also, China wonders if Japan Post Insurance would operate as an insurance intermediary as well.  If 
so, would foreign insurers be able to have access to Japan Post Insurance as insurance agents or 
distribution channels for their products?  
 
Question 16 
China understands that Japan has taken various re form measures in the ser vices sector including 
allowing banks to sell all insurance products over the counter (December 2007) and lifting the ban on 
certain agent business by insuran ce companies (March 2008).   
 
China would like to know whether foreign service- providers would be treated equally as their 
domestic counterparts under such measures.  
 
Question 17 
Paragraph 35 on Page 81 indicates that "exports (cre dit) and imports (debit) of financial services 
(except insurance) increased in 2007;  exports  increased from ¥716 billion (5.2% of total services 
exports) in 2006 to ¥731 billi on (4.8%), and imports increased from ¥348 billion (2.2% of total 
services imports) to ¥425 billion (2.4%).  On the othe r hand, exports of insu rance services decreased 
from ¥183 billion (1.3% of total services exports) in 2006 to ¥159 billion (1.0%) in 2007, and imports 
decreased from ¥531 billion (3.4% of total servi ces imports) to ¥486 billion (2.7%)."  
 
Would the Delegation of Japan please give its views on the reason of the decrease of trade volume in the insurance service sector?   
 
Question 18 
 Would the Delegation of Japan please describe how the current financial a nd economic crisis has 
affected the Japanese economy?  
What measures has the Japanese Government taken in face of it? 
 
(Third batch) 
 
REPORT OF THE SECRETARIAT  
 
II. TRADE POLICY REGIMES: FRAMEWORK AND OBJECTIVES  (1) Trade Policy Formulation and Evaluation (Chapter II, Paragraph 10-14)  
Question 1 Would the Delegation of Japan please provide in formation regarding sm all and medium-sized 
enterprises (SMEs) in Japan and assistance to them, including: 
 WT/TPR/M/211/Add.1 
Page 12  
 
  a) information regarding the development of SMEs in 2007 and 2008 including, inter alia, the 
trend of development, the number of newly- established and bankrupted SMEs, and possible 
measures in the future to promote the development of SMEs;  
b) legislation, policies, measures as well as relevant budgets allocated to support the 
development of SMEs since 2007; 
c) review or evaluation on the effects of th e Law Concerning the Organization of Small and 
Medium Enterprises Organizations and; 
d) measures taken specifically to help financing SMEs in response to the on-going financial and 
economic crisis. 
 
III. TRADE POLICIES AND PRACTICES BY MEASURES 
 (1) M
EASURES DIRECTLY AFFECTING IMPORTS  
 
(i) Customs Clearance Procedures (Chapter III, Paragraph 13-17) 
 Question 2 
Would the Delegation of Japan please explain the meaning of the "overtime charge system" mentioned in Paragraph 13 of the Report?  Please al so explain the reason for abolishing this system. 
 
Question 3 
Paragraph 14 of the Report mentioned that "ite ms requiring approval by the Director-General of 
Customs can be declared before they are taken to the hozei  area".  Would the Delegation of Japan 
please provide the scope of these items?  Question 4 
With regard to customs evaluation mentioned in Pa ragraph 16 of the Report, would the Delegation of 
Japan please provide laws and regulations governing the evaluation process or indicate the reference 
number if they have been notified to the WTO? 
 
(ii) Non-tariff Border Measures (Chapter III, Paragraphs 30-34) 
 
Question 5 With regard to the "prior confirmation system" me ntioned in Paragraph 34 of the Report, would the 
Delegation of Japan please explain the meaning of "to verify documentation and origin requirements" 
on "certain imports"? Please also explain the procedure of the Japanese customs to determine whether 
"certain imports" are "for specific uses" or not, as well as the influence of this procedure on customs 
clearance.  
IV. TRADE POLICIES BY SECTOR 
 
(1) S
ERVICES  
 
(ii) Transport Service (Chapter IV, Paragraphs 59-74) 
 
Question 6 
What is the policy of Japan rega rding ship survey br anches established in Japan by foreign ship 
classification societies?  What are the regist ration process and requirements for these entities? 
   WT/TPR/M/211/Add.1 
 Page 13 
 
 
  MEXICO  
 
Se solicita a Japón responder a las siguientes pre guntas formuladas con base en lo señalado en el 
documento WT/TPR /S/211 del 14 de enero de 2009. 
 IV. POLÍTICAS COMERCIALES POR SECTORES / 5) Servicios / i) Visión General.    
 
En el párrafo 31 se indica que el Japón presentó el 24 de junio de 2005 su oferta condicional revisada 
en el sector de los servicios. Al respecto, México está interesado en saber si Japón tiene contemplado eliminar las exenciones del trato NMF a  los servi cios marítimos, los servicios de cabotaje, de 
expedición de carga internacional y de  transporte marítimo internacional. 
 
IV. POLÍTICAS COMERCIALES POR SECTOR ES / 5) Servicios / ii) Servicios 
financieros.    
 En el párrafo 37 se indica que el principal instrume nto legislativo que rige el  funcionamiento de los 
bancos es la Ley de Banca, en virtud de la cual los bancos necesitan una licencia para operar en el 
Japón. Una vez obtenida la licencia, los bancos ex tranjeros pueden entrar en el mercado japonés 
estableciendo sucursales o filiales. México desearía conocer los requisitos para obtener una licencia 
para que un banco extranjero opere en Japón.  IV.  POLÍTICAS COMERCIALES, POR SECTORES / 5) Servicios / iii) 
Telecomunicaciones.   
 
En el párrafo 52 se hace referencia a que el mayor  crecimiento de la productividad total de los 
factores en el sector de "la información y las comunicaciones" puede atribuirse a la reciente 
liberalización del sector en el país, que intensific ó la competencia.  No obstante, la Comisión de 
Comercio Leal del Japón (JFTC) sostiene que el me rcado japonés de servicios de telefonía fija y 
telefonía móvil se caracteriza por "situaciones de m onopolio" (oligopolio), tal como se definen en el 
párrafo 7 del artículo 2 de la Ley Antimonopolio. Mé xico desearía conocer en qué consistió la 
reciente liberalización del sector a que se hace referencia.  IV. POLÍTICAS COMERCIALES, POR SECTORES  / 5) Servicios / iv) Servicios de 
transporte / a) Transporte marítimo / 
 
En el párrafo 60 se indica que las autoridades sos tienen que no existen medidas discriminatorias que 
afecten a la participación extranjera en servicios de transporte marítimos internacionales y que los 
acuerdos bilaterales del Japón sobre el transporte de  pasajeros o carga otorgan trato nacional a los 
interlocutores comerciales sobre la base de la reciprocidad. México desearía conocer de qué manera cambian los requisitos para que una empresa extranje ra proporcione servicios de transporte marítimo 
internacional al amparo de un acuer do bilateral y fuera del mismo. 
 
IV. POLÍTICAS COMERCIALES, POR SECTORES  / 5) Servicios / iv) Transporte / 
b/ Transporte aéreo   
 
En el párrafo 134 se señala que no se aplican restri cciones a los extranjeros en la operación de los 
puertos o la prestación de servicios portuarios aux iliares, tales como el practicaje, remolque, de 
manipulación y almacenamiento.  México desearía  conocer los requisitos para  que empresas 
extranjeras proporcionen dichos servicios.    
 WT/TPR/M/211/Add.1 
Page 14  
 
  IV. POLÍTICAS COMERCIALES, POR SECTORES / 5) Servicios / v) Servicios 
profesionales / a) servicios jurídicos  
 
En el párrafo 75 se indica que además de obtener las licencias pertinentes, para las siguientes 
profesiones es obligatorio pertenecer a una asoci ación profesional:  contador público certificado, 
escribano administrativo, abogado, notario, topógrafo,  contable fiscal titulado, consultor público en 
seguros sociales y laborales y abogado especializado en patentes. México desea saber si estos 
requisitos se aplican de la misma forma a profesionistas extranjeros. 
En el párrafo 77 se señala que la participación extran jera en el sector está reglamentada por la Ley de 
Abogados en Ejercicio y por la Ley de medidas espe ciales sobre el ejercicio de la profesión jurídica 
por abogados extranjeros.  Con arreglo a esta legislación, un "abogado extranjero registrado" 
(abogado extranjero titulado de acuerdo con la  legislación japonesa) puede emplear a un bengoshi  (un 
abogado titulado de acuerdo con la legislación ja ponesa) y ambos pueden establecer una empresa 
conjunta.  México desea conocer los requisitos para que un abogado se titule de acuerdo con la 
legislación japonesa. 
 
IV. POLÍTICAS COMERCIALES, POR SECTORES / 5) Servicios / vi) Otros servicios /  
 
En el párrafo 79 se menciona que con miras a facilitar el movimiento de las personas físicas, el Japón 
tiene una lista de ocho interlocut ores comerciales (China;  Filipinas;  Malasia;  Myanmar;  la 
República de Corea;  Singapur;  el Taipei Chino;  y Viet Nam) cuyos exámenes o títulos de ingenieros 
en tecnología de la información son reconocidos por  el Servicio de Inmigración del Japón para que 
sus nacionales adquieran la condición de residentes en calidad de "ingenieros".  México desea saber si 
Japón tiene previsto incluir a un mayor número de países como interlocutores comerciales. 
 
DERECHOS DE AUTOR 
 1. ¿La Ley de Derecho de Autor prevé la protección de títulos, nombres, denominaciones, 
características físicas y psicológicas distintivas, o características de operación originales aplicados, de acuerdo con su naturaleza a alguno de los siguientes géneros:? 
 
a) Publicaciones periódicas: Editadas en partes sucesivas con variedad de contenido y que 
pretendan continuarse indefinidamente; 
b) Difusiones periódicas: emitidas en partes sucesi vas con variedad de contenido y susceptibles 
de transmitirse; 
c) Personajes humanos de caracter ización o ficticio o simbólicos; 
d) Personas o grupos dedicados a actividades artísticas; y e) Promociones publicitarias: contemplan un mecanismo novedoso y sin protección tendiente a 
promover o ofertar un bien o un servicio  con el  incentivo adicional de brindar la posibilidad 
al público en general de obtener otro bien o servicio en condiciones más favorables que en las 
que normalmente se encuentra en el comercio. 
 
De ser este el caso, ¿bajo qué figura jurídica los protege? 
 
2. ¿La Ley de Derecho de Autor prevé la protección de las expresiones del folclore? De ser este el caso, ¿qué abarca la protección de dichas expresiones? 
 
3. ¿Cuál es la duración de la prot ección del derecho de autor en Japón? 
 
4. ¿Cuál es la duración de la protecci ón de los derechos conexos en Japón? 
 
5. ¿Contempla la Ley de Derecho de Autor o alguna otra legislación disposiciones sobre 
protección jurídica y recursos jurídicos contra la acción de eludir medidas tecnológicas, así como 
contra la supresión o alteración de informaci ón electrónica sobre la gestión de derechos?  WT/TPR/M/211/Add.1 
 Page 15 
 
 
  OBSERVANCIA 
 
1. ¿Qué autoridad interpone las multas en materia de Propiedad Intelectual? 
 2. ¿De qué manera se garantiza el pago de las multas interpuestas por infracciones a los 
derechos de propiedad intelectual? 
3. Podría explicarse con mayor detalle cuál es el  procedimiento que lleva a cabo las autoridades 
de Aduanas para identificar las mercancías que in fringen los derechos de propiedad intelectual. 
 4. Con relación al procedimiento que se sigue en las aduanas para detener la mercancía 
infractora: 
 a) ¿los especialistas que consulta la autoridad a duanera, forman parte de la Oficina de Patentes 
de Japón o son abogados independientes o re presentantes de las marcas o derechos 
afectados?, 
b) Es o no obligatorio para la autoridad aduanera consultar a lo s especialistas antes de emitir su 
dictamen sobre la autenticidad de la mercancía? 
c) La autoridad aduanera cuenta con especialist as propios en materia de propiedad intelectual?, 
d) En caso de que se acredite que las mercancías que fueron detenidas son originales, ¿Quién se 
hace cargo de los gastos ocasionados al importa dor, tales como almacenaje y hasta sanciones 
por no haber entregado en tiempo la mercancía 
 
5. ¿Con base en la Ley de Abogados de Patentes,  cuáles son las funciones exclusivas de estos, 
son los únicos que pueden presentar solicitudes de  patentes y ejercer algún acto en esta materia? 
 6. ¿Cuáles son las sanciones por el in cumplimiento de la Ley de Abogados? 
 
7. ¿Ante quién se presenta el recurso contra la decisión de denegación de un examinador? Existe 
un recurso posterior a dicho recurso en caso de que se reconfirme la denegación o titular no esté 
plenamente conforme con la decisión.  8. ¿Cuáles fueron las razones que motivaron aument ar la protección de 15 a 20 años para los 
dibujos y modelos? 
 9. Podría explicarse con mayor de talle la naturaleza y funcionamiento de la sede de  política de 
propiedad intelectual.  
10. Con relación a la Ley de prevención de grab aciones no autorizadas de películas en salas de 
cine, que sanciona penalmente la gr abación de películas proyectadas en las salas  de cine sin permiso: 
 a) ¿Cuál es la pena mínima con la que se sanciona el delito? b) ¿Existe sanción alguna para la tentativa de este ilícito?, en ese caso c) ¿Cuál es la sanción y cuáles son las condiciones objetivas y subjetivas que se toman en 
consideración para determinar  que existe tentativa?, y 
d) ¿Cuál es el procedimiento que  se sigue en el caso de que se detecte a alguna persona haciendo 
grabación en el cine? 
 
I. INDICACIONES GEOGRAFICAS 
1. ¿Quién puede ser el titular de una indicación geográfica en Japón? 
 2. ¿Ante quién se presenta la solicitud de  registro de una indicación geográfica? WT/TPR/M/211/Add.1 
Page 16  
 
  3. ¿Cuál es la protección que se le otorga a una indicación geográfica extranjera? 
 
NUEVAS OBTENCIONES VEGETALES 
 
1. Clarificar el ámbito de aplicación de cada una de estas leyes, es decir, si ambas leyes (La Ley 
de Protección de Obtenciones Vegetales y de Semilla s y La Ley de Patentes) podrían aplicarse en una 
misma variedad vegetal, o si la interrelación obe dece a la eventual aplicación de tecnologías tuteladas 
bajo una patente, para la obtención de nuevas va riedades vegetales, mismas que serían protegidas al 
amparo del derecho de obtentor.  
2. Si podría proporcionarse información sobre lo s criterios o bases para el cálculo de la 
indemnización que permita resarcir el daño hacia lo s titulares del derecho de obtentor, toda vez que 
resulta un tema de gran interés y que constit uiría una referencia muy provechosa para el 
fortalecimiento del sistema de protección en México.  Informe de gobierno del Japón 
 
1) En el párrafo 8 se menciona que en junio de 2008 el gobierno adoptó una serie de medidas, 
entre ellas la reforma fiscal y económica 2008 (políticas básicas); el conjunto global de políticas inmediatas: medidas para aplacar los temores de  la población; y el conjunto de políticas económicas: 
medidas para ayudar a la población en su vida co tidiana. ¿Podría Japón dar más detalles sobre estos 
programas y los beneficios que se ha n obtenido desde su implementación? 
 
Informe de la Secretaría de la OMC 
 
2) Capítulo II 4) ii) a) El párrafo 19 del informe de la Secretaría de la OMC, menciona que la 
entrada en vigor de los diferentes acuerdos bilate rales de Japón con países de ANSEA y el ALC con 
ANSEA como bloque no conllevará a la integración de éstos en un TLC único ¿Podría Japón explicar 
los beneficios de tener acuerdos individuales y otro como bloque?  3) Capítulo III 2) i). El párrafo 16 hace referenc ia a la introducción de un Portal Común para la 
Ventanilla Única de Nueva Generación en oct ubre de 2008, ¿podría Ja pón proporcionar mayor 
información sobre este portal, el ti po de trámites que pueden realizarse? 
 4) Capítulo III 3) i). En el párrafo 68 se menc iona que en virtud del Artículo 19 de la Ley 
Arancelaria, los aranceles aplicados a las materias primas utilizadas en la producción de bienes de 
exportación por fábricas autorizadas por la Adua na pueden ser objeto de reducción, exención o 
reembolso (mediante devoluciones). ¿Podría Japón i ndicar los criterios que la oficina de aduana 
utiliza para autorizar a una fábrica ser objeto de estos beneficios?  5) Capítulo IV. 2) ii). En el párrafo 11 se indi ca que el MAFF publica en Internet los nombres de 
las empresas de las compañías o personas a las que se asignan los contingentes arancelarios. Al 
respecto, en la nota al pie de página 10 se propor ciona una liga dónde puede consultarse los nombres, 
sin embargo la liga no reporta alguna información.  
  i) ¿Podría Japón proporcionar la liga correcta donde se puede consultar esta 
información?  ii) ¿Este tipo de información en línea está di sponible para el caso de los contingentes 
con preferencia arancelaria derivados de los Acuerdos de Libre Comercio? De ser el caso favor de 
proporcionar la liga electrónica de Internet.   WT/TPR/M/211/Add.1 
 Page 17 
 
 
  Preguntas adicionales 
 
III. POLÍTICAS Y PRÁCTICAS COMERCIALES, POR MEDIDAS  
2) M EDIDAS QUE AFECTAN DIRECTAMENTE A LAS IMPORTACIONES   
vii) Normas, y medidas sanitarias y fitosanitarias 
c) Prescripciones en materia de etiquetado y envasado 
 Párrafo 61-65  1. Con relación al los productos alimenticios sujetos a etiquetado obligatorio con arreglo a la 
Norma de etiquetado de la calidad para los pr oductos alimenticios modificados genéticamente, 
aplicado desde el 1o de enero del 2007,  (a) ¿Qué información contiene la e tiqueta para dichos productos?  
(b) ¿Cuáles son los requisitos adicionales de info rmación para los productos incluidos en la lista 
[siete cultivos (habas de soja, maíz, semillas de colza, patatas,  semillas de algodón, alfalfa y 
remolacha) y 32 clases de productos alimenticios (elaborados principalmente a base de habas 
de soja o maíz, la remolacha azucarera, el ma íz con alto contenido de lisina y los productos 
alimenticios elaborados que lo contengan como ingrediente principal) para su etiquetado? 
(c) ¿Cuáles son los productos registrados en las listas?  (d) ¿Cuáles son las referencias internacionales ( acuerdos, normas y lineamientos) en la aplicación 
de este tipo de etiquetado? 
(e) En el párrafo (65) relativo al etiquetado de la calidad para los productos alimenticios 
modificados genéticamente se hace referencia  a que no se permite la importación de 
productos alimenticios modificados genéticam ente que no cumplan sus prescripciones en 
materia de inocuidad. ¿En tal situación, la autoridad de Japón está solicitando que la 
información de inocuidad se encuentre disponible  en la etiqueta o bien es un requisito de 
información en la documentación que acompaña dichos productos de ma nera independiente a 
la información contenida en la etiqueta? 
 
III. POLÍTICAS Y PRÁCTICAS COMERCIALES, POR MEDIDAS 
2) M
EDIDAS QUE AFECTAN DIRECTAMENTE A LAS IMPORTACIONES  
i) Procedimientos de despacho de aduana 
(d) Vigilancia de las importaciones  
 Párrafo 34  (1) El párrafo 34 del documento indica que mediante  el sistema de confirmación previa de datos 
sobre determinadas importaciones, con el fin de asegurar que se destinan a usos específicos, y para 
verificar la  documentación y los requisitos de or igen, en particular la información relativa a 
determinadas sustancias incluidas en el Anexo E del Protocolo de Montreal se solicita dicha 
información. ¿Con base en qué sólo  son elegibles determinadas sustancias del Anexo E del Protocolo 
de Montreal?  
(2) ¿El resto de los Anexos del Protocolo de Mont real están excluidos del sistema de vigilancia 
de importaciones?  
Preguntas adicionales 
 1. En el punto 9 del informe, donde señala: "Desde el anterior examen de Japón se han 
modificado diversas leyes sobre los derechos de Prop iedad intelectual (DPI), con miras a reforzar su 
protección (por ejemplo, aumentando las sanciones por infracción)",   ¿Podrían confirmar que estas 
modificaciones ya han sido notificadas a la OMC?  WT/TPR/M/211/Add.1 
Page 18  
 
  2. Sobre los títulos " b) Medidas Sanitarias y f itosanitarias; y  c) prescripciones en materia de 
etiquetado y envasado...", señalados en las páginas 57 y 58 del informe.  
Podrían ampliar su descripción sobre los cambios que se han implementado para el establecimiento de estas medidas sanitarias, por ejemplo en lo que se re fiere a lo establecido para la leche en polvo, 
carnes, pescado, etc. 
  
3. Podrían detallar las acciones que en materi a de fomento Japón haya implementado desde su 
último examen, ya sea para su comercio exteri or o bien hacia el interior de su país. 
 
Preguntas adicionales 
 
1. En la sección sobre Actividades multilaterales del Japón  se menciona que “en la Conferencia 
de Alto Nivel sobre la Seguridad Alimentaria Mundial organizada por la Organización de las 
Naciones Unidas para la Agricultura y la Aliment ación (FAO), en junio de 2008, el Japón exhortó a 
los países a abstenerse de impone r restricciones a las exportaciones de productos agrícolas y otras 
medidas.” Párrafo 33. En el EXAMEN DE LAS POLÍTICAS COMERCIALES Informe de la 
Secretaría, Párrafo.16. se concluye que "Japón mantie ne determinados controles sobre la exportación 
por razones de seguridad nacional y sanidad públi ca y para garantizar un abastecimiento interno 
suficiente de determinados productos agrícolas y otros productos primarios."  Podría Japón clarificar 
esta posible discrepancia? (JP exige a otros paí ses que no impongan controles a la exportación de 
productos agrícolas, cuando JP los impone o está di spuesto a imponerlos en algunas circunstancias) 
 
2. En la sección sobre Actividades regionales del Japón se menciona que "Japón se esfuerza por 
desarrollar todos los marcos de cooperación regiona l, en particular el grupo ASEAN+3 (el Japón, 
China y la República de Corea), el marco bila teral ASEAN-Japón, la cooperación tripartita Japón-
China-Corea y la recientemente establecida Cumbre de Asia Oriental (EAS), junto con estructuras 
más amplias tales como el APEC y la ASEM."  Párrafo.39 Podría mencionar Japón su opinión sobre 
el proceso de integración que se está conformando al rededor del P4 (Chile, Brunei, Nueva Zelanda y 
Singapur) más EE.UU., Australia, Perú y posiblement e Vietnam? Estaría Japón interesado en sumarse 
a esta iniciativa?   SWITZERLAND
 
 
Report by the Secretariat 
 
I.  ECONOMIC ENVIRONMENT 
 
(2) M ACROECONOMIC POLICIES  
 
(ii) Fiscal policy 
 In para. 10, the Secretariat's report indicates th at Japan's three fiscal objectives announced in its 
"Direction and Strategy" in January 2007 are:  1)  to achieve a primary balance surplus of the 
combined central and local governments by FY2011;  2) to stabilize the government debt-to-GDP ratio before reducing it in the mid-2010s and 3) to curb  expansion of the civil service.  In view of the 
substantial economic downturn that Japan is curre ntly facing, could the Japanese authorities indicate 
whether they consider that the first two of th ese objectives are still valid?  How do they intend to 
reconcile these objectives with th e present need to stabilize the economy? In this respect, what 
measures, if any, are being considered by the aut horities to stabilize the economy in the short-term ?  
Also, in a longer term perspective, do the Japanese  authorities not consider that a more aggressive 
reduction of the debt-to-GDP ratio would be warran ted than the one foreseen in the "Direction and  WT/TPR/M/211/Add.1 
 Page 19 
 
 
  Strategy", given that the extremely high current de bt-to-GDP ratio of 170 percent is likely to further 
increase in the short run as a result of the recession?   
(3) S
TRUCTURAL POLICIES  
 
(ii) Financial system and corporate reform 
 
In para. 19, the Secretariat's report indicates that the structure of the certified public accountant examination, as well as increasing the frequency of the examination (twice a year) is to be changed so 
as to make the profession more accessible, and enc ouraging and facilitating the hiring of foreign 
financial experts.  Could the Japanese authorities elaborate on how the hiring of foreign financial 
experts has been facilitated? Do th ey need to pass an examination?  Is Japan considering to accept a 
proof of professional experience as sufficient?  
II.  TRADE POLICY REGIME: FRAMEWORK AND OBJECTIVES 
 
(3) T
RADE POLICY FORMULATION AND EVALUATION  
 
(iii) Transparency 
 
In para. 15, the Secretariat's report suggests that all laws, regulations, and rules are published in the 
Government Gazette.  The Government makes ava ilable all laws, Cabinet orders, and ministerial 
ordinances on the Internet;  however, various Cabinet decisions and "understandings" are not 
available.  Could the Japanese authorities explain, first, the nature of these Cabinet decisions and 
"understandings" as well as the difference of these with Cabinet orders and,  second, the reasons for 
applying a lesser degree of transparency to Cabi net decisions and "understa ndings" than to Cabinet 
orders, and ministerial ordinances? 
 
(5) F OREIGN INVESTMENT REGIME  
 
(iii) Regulatory Regime 
 In para. 56, the Secretariat's report indicates that prior notification is required for foreign direct 
investment in a fairly large number of sectors (this poi nt is also made in Chapter IV, with respect to 
the manufacturing sector,  in para. 26).  At the same time, it notes (see Chapter I, para. 33 on foreign 
direct investment) that inward FDI into Japan re mains substantially lower than outward FDI and low 
compared to other developed economies.  Given th e low flow of inward FDI to Japan, could the 
Japanese authorities indicate whether Japan is cons idering easing FDI notification requirements?  
 
III.  TRADE POLICIES AND PRACTICES BY MEASURES  
 
(2) M
EASURES DIRECTLY AFFECTING IMPORTS  
 
(i) Customs clearance procedures 
 
With respect to paras. 13 to 17 as well as para. 69 (see Chapter III on export procedures) of the 
Secretariat's report, Switzerland would have the following question: Could the Japanese authorities 
indicate whether Japan negotiated reciprocal r ecognition of its Authorized Economic Operator 
programme with other WTO-Members, or are such negotiations under way or planned? 
 WT/TPR/M/211/Add.1 
Page 20  
 
  (v) Government procurement 
 
Para. 39:  The Secretariat's report states that gove rnment procurement is c onducted without restriction 
on suppliers' nationality or on the orig in of products or services, that it is based on the principle of 
non-discrimination, and that no price or other prefer ences are granted to domestic suppliers in tenders 
covered by the GPA.  Is it appropriate to unders tand that small and medium enterprises (SMEs) are 
fully covered by the said appreciation and that th ere is in Japan no specific measure providing to 
Japanese SMEs a treatment more favorable than the one granted to foreign suppliers and/or foreign 
SMEs ?   
Para. 41:  According to the Secretariat's report, the Government of Japan adopted in 2007 measures 
aiming at improving competitive bidding methods.  As a result of these improvements, "open tendering" seems to have increasingly replaced “single tendering” which is said to have declined from 
44.1 per cent to 32.7 per cent.  Could the Japanese authorities explain the differences between "single 
tendering" and the three tendering methods covere d by the GPA (open tendering, selective tendering 
and limited tendering) ?   
 
(vii) Standards, and sanitary  and phytosanitary measures 
 
(a) Standards, testing, and conformity assessment 
 
Voluntary standards  
Para. 49:  The JAS Law (the Law Concerning Sta ndardization and Proper Labelling of Agriculture 
and Forestry Products) incorporates ISO Guide 65 as registration criteria for certifying bodies. The authorities expect the number of Registered Over seas Certifying Bodies (ROCBs) under the JAS law 
to increase in the future. In this regard, could th e Japanese authorities indicate if compliance with ISO 
Guide 65, verified through fore ign accreditation, would be taken into account as an indication of 
adequate technical competence ? 
 
Bilateral, regional and multinational arrangements 
 Para. 55:  Japan has signed several agreements cont aining provisions relating to mutual recognition of 
conformity assessment procedures. Could Japan elaborate on the concrete outcome of such agreements, for instance the number of conformi ty assessment bodies that are recognized by the 
Japanese authorities under such agr eements? Does Japan envisage to conclude further agreements 
along those lines? 
 
Sanitary and phytosanitary measures 
 
In para. 59, the Secretariat's report notes that Japan imposes import prohibitions on beef and poultry from various countries. Since Switzerland has been classified by the World Organization for Animal 
health (OIE) as a country with "controlled BSE risk ", and beef from animals below 30 months of age 
should therefore be traded without any restrictions with regard to BSE, could Japan elaborate on the 
reasons for prohibiting Swiss beef imports or, alte rnately, present a scientific-based risk assessment 
for banning such imports?   
(3) M
EASURES DIRECTLY AFFECTING EXPORTS  
 
(iv) Export cartels 
 
In para. 72, the Secretariat's report indicates that the Japan Fair Trade Commission has recently sent a 
request to the Ministry of Land, Infrastructure and Transport to review the cartel exemption for  WT/TPR/M/211/Add.1 
 Page 21 
 
 
  shipping. Could the Japanese authorities indicate whet her the Ministry of Land, Infrastructure and 
Transport intends to follow suit to the request of the competition authorities and, if yes, over what 
time frame ?  
(4) M
EASURES AFFECTING PRODUCTION AND TRADE  
 
(i) Taxation and tax-related assistance 
 
In para. 77, the Secretariat's report suggests th at while Japan has high statutory rates for both 
corporate and personal income taxes, it also has one of the lowest tax to GDP ratios.  In particular, 
less than half of the personal income is being actua lly taxed.  Furthermore, there also seems to be 
scope for improved transparency, gi ven the apparent complexity of the local taxation system.  The 
Secretariat's report therefore concludes that there is a need for both broadening the tax base and improving the transparency of the taxation system  in order to improve tax collection given the 
budgetary problems Japan has been facing now for y ears.  Could the authorities indicate which fiscal 
reforms, if any, are being planned in this respect  and, if not, what problems are being encountered 
which have so far hampered a modernization of the Japanese taxation system ?  
(v) Regulatory reform 
 
In para. 110, the Secretariat's report notes that  "in 2008, a bill to further amend the AMA was 
submitted to the Diet, but has not yet been adopted .  The bill seeks to introduce a surcharge on, 
inter alia , exclusionary types of private monopoliza tion, abuse of dominant bargaining position, 
discriminatory pricing…".  It can be shown that price discrimination is in fact sometimes welfare 
enhancing: under certain conditions, more consumers will be served if price discrimination is allowed. 
Could the Japanese authorities indicate what types of price discrimination are prohibited under the 
Japanese AMA? 
 Referring to para. 112, Table III-9: (export cartels) of the Secretariat's report, some export cartels are 
allowed under Japanese competition law.  Are all those cartels publicly known and does Japan not 
consider that such cartels can be  detrimental in the long run? 
 
 
REPUBLIC OF KOREA
 
 
Question 1 :  Government Report, page 6, paragraph 8  
 The Government Report states that as part of its reform efforts, "the (Japanese) government will 
steadily implement the "Comprehensive Immediat e Policy Package-Easing Public Anxiety"."  
The Government Report continues by stating that, "I n addition, in view of the present financial and 
economic conditions, the Government  published the "Economic Policy Package: Measures to Support 
People's Daily Lives" on 30 October."  
In comparing the above with the Secretariat Re port, Korea notes that the Japanese Government has 
allocated ¥1.81 trillion for the "Comprehensive Imme diate Policy Package" within the supplementary 
budget for FY2008 (page 4, paragraph 5).  In light of the above, Korea seeks clarification on the following points: 
 
1) What is the figure allocated for the "Econom ic Policy Package: Measures to Support People's 
Daily Lives" published on 30 October? Is the allocated figure separate from the ¥1.81 trillion 
allocated for the "Comprehensi ve Immediate Policy Package"? 
 WT/TPR/M/211/Add.1 
Page 22  
 
  2) The Secretariat Report (page 4, paragraph 5) describes in brief the specifics of the 
"Comprehensive Immediate Policy Package." Could Japan further elaborate on the different programs 
included in this package?  3) With regards to the "Comprehensive Imme diate Policy Package", please explain how (and in 
what context) the stated purpose of "vitalizing SME, supporting local governments, strengthening of 
agriculture, forestry and fisheries, and (support) fo r housing and disaster measures" consitute 'reform', 
its intended purpose.  4) Could Japan further elaborate on the differen t programs that will be implemented within the 
context of the "Economic Policy Package: Measures to Support People's Daily Lives"? 
 5) Please confirm whether there are any measur e within both the "Comprehensive Immediate 
Policy Package-Easing Public Anxiety" and "Econo mic Policy Package: Measures to Support People's 
Daily Lives" that does not conform to the G-20 Declaration of November, 2008. 
 
Question 2
 
 
It has come to our attention that on 27 January, 2009, the Minister of Industry of Japan announced plans to provide assistance to the private sector in the form of dir ect capital infusion (as opposed to 
granting loans).  
 
With respect to this item, Korea se eks clarification on the following:  
 1) Please confirm whether such plans are under c onsideration. If yes, please provide concrete 
details of this plan, and whether this plan is i ndependent or is somehow related to the two packages 
referred to in Question 1 above. 
 2) (If this reported plan will be implemented) Please confirm how this plan conforms (or will 
conform) to the G-20 Declaration of November, 2008. 
 
Question 3
:  Government Report, page 7, paragraph 12~13  
 
Page 7, paragraphs 12 and 13 of  the Government Report describ es the efforts of the Japanese 
Government to increase inbound FDI.  On th is item, Korea has the following questions: 
 1) As a general question, is there a particular sector ("strategic sector") in which Japan would 
like to see more inbound FDI?  
 2) Could Japan elaborate on the specifics of th e program launched in J une 2006 in response to 
the goal set in May, 2006?  Please explain in deta il the specific action plans devised for each of the 
"3 Key Issues" included in the program.  
3) Could Japan provide an assessment of the program launched in J une 2006?  Has it been 
successfully implemented thus far?  Is Japan optim istic that the goal for 2010 will be attained as 
originally planned?  Are ther e plans for any adjustments? 
4) Could Japan provide in detail follow-up measures implemented subsequent to the 
recommendations provided by the 'Expert Committee on FDI Promotion' in May, 2008? 
 
5) Could Japan provide a copy of the "Progr am for the Acceleration of FDI in Japan"? 
  WT/TPR/M/211/Add.1 
 Page 23 
 
 
  Question 4 :  Government Report, page 9, paragraph 24  
 
Paragraph 24 states as follows:  "The basic principle of Japan is . . . . . Japan takes into full account 
the interests of developing countries and has made substantial offers, including those in mode 4.  
Mindful of the fact that the scheduled commitments  provide legal certainty and predictability, Japan 
continues to attach importance to the improvement of the level of, as well as to the achievement of a 
higher degree of transparency and clarity of, the scheduled commitments of the Members"  
 1) Could Japan elaborate on the "s ubstantial offers" in Mode 4? 
 
2) In light of the last sentence of in paragr aph 24, can Japan confirm whether it is willing to 
commit its existing legislation on Mode 4 in its GATS schedule of commitments?  
 
Question 5
:  Government Report, page 9, paragraph 26  
 Could Japan confirm whether a domestic system for the notification and registration of GIs (for 
wines, spirits and other goods) are in place in Japan ? Is so, could Japan elaborate on its particular 
aspects?  
Question 6
:  Government Report, page 14, paragraph 54  
 With respect to the table under para 54, Ko rea would like to raise the following questions: 
 1) From amongst the 9 EPAs in force as of today,  which EPA has had the greatest impact –either 
positively or negatively-- on the Japanese economy? Which sectors has benefited the most? Which 
sector has been adversely affected? 
 
2) What are the differences between th e Japan-ASEAN EPA and individual EPAs with 
Thailand, Indonesia, Brunei, the Philippines, and Vietnam?   3) For each of the 9 EPAs in force,  could Japan provide the following? 
 - Total coverage, AG produc ts coverage, Manufacturing pr oducts coverage, Fisheries 
Products coverage  
  * in terms of tariff lines (at HS-9 digit) and in terms of bilateral trade volume  
Question 7
:  Secretariat Report, page 5, paragraph 9  
 The Secretariat Report points out that the unwinding of the yen "carry trade" has contributed to the 
recent appreciation of the Japanese Yen.   1) What is Japan's assessment of the current situation? Does Japan fo resee further appreciation 
of the Japanese Yen in the coming months?   
2) If so, this could adversely affect the exports,  trade balance, and economic growth of Japan in 
the short term. What measures have been (or will be) implemented to cope with this situation? 
 
Question 8
 : Secretariat Report, page 5, paragraph 10  
 The Secretariat Report indicates that Japan recorded a fiscal deficit in 2007 which amounts to 2.4% as 
a percentage of GDP, and public debt amounts to 170% of the GDP.   1) Could Japan provide further information on the economic stimulus package announced by the Japanese government in August, October and No vember of 2008 (amount, scope and expected WT/TPR/M/211/Add.1 
Page 24  
 
  effect)? Are the 3 packages separate packages, or improvements of the previously announced stimulus 
packages?  2) What is Japan's estimate on the contribu tion of the aforementioned economic stimulus 
package(s) to the GDP growth rate of Ja pan for 2009? What %p increase is expected? 
 
3) In light of the existing fiscal deficit and the public debt, what plans does Japan have to relieve 
the concerns that such a large-scale economic stim ulus package may further aggravate the Japanese 
government's fiscal situation?  Question 9
:  Secretariat Report, page 15, paragraph 1  
 
Paragraph 1 states that, “The only major change in  Japan's government ministries and agencies . . . 
involves the abolition of the cabinet-level Japan Investment Council, and the establishment of the 
Expert Committee on FDI Promotion within the Cabinet Office.” 
 
Could Japan elaborate on this change? What wh ere the policy objectives of this change?  
What is Japan's assessment (as of today) on this change?  
Question 10
:  Secretariat Report, page 32, paragraph 5  
 Korea would like to request a list of exports contro l measures maintained by Japan, including its legal 
basis.  
Question 11
:  Secretariat Report, page 32, paragraph 6  
 Paragraph 6 states that, "No preferences are granted to domestic suppliers with  regard to procurement 
covered by the Agreement on Government Procurement.   Nevertheless, the share of foreign suppliers 
in the total value of government procurement was 3. 1% in 2006, the latest year for which data are 
available, down from 3.7% in 2004."  What is Japan's assessment for the downturn of the share of foreign suppliers in the GP market of 
Japan? 
 
Question 12
:  Secretariat Report, page 46~ 47, paragraph 48, Table III.4  
 
Despite the statement of the 'authorities' as described  in the Secretariat Report, it has come to our 
attention that even in cases where a product is compliant with an international standard, JIS 
compliance is required for entry into  the Japanese market. This practice is in fact indirectly proven by 
the '..' entry in the column  for "Acceptance of overseas certification" in Table III.4.  
 In light of the above, Korea would like to inquire whether Japan has any plans to improve the market 
access opportunities of its trading partners by either a) accepting overseas certification, b) introducing 
simplified procedures for obtaining JIS/JAS certif ication, or c) introduc ing support programs for 
foreign firms.  
Question 13
:  Secretariat Report, page 47- 48, paragraph 51-54, Table III.4  
 For road vehicles and electricity/gas/chemical pr oducts, it is our understanding that irrespective of 
whether a product adheres to or has already been certified under inter- national safety standards, a 
separate safety test must be performed in Japan.  As Table III.4 indicates, the acceptance of overseas 
certification is very low and limited to road vehicles.   WT/TPR/M/211/Add.1 
 Page 25 
 
 
  In light of the above, Korea would like to inquire whether Japan has any plan s to improve the market 
access opportunities of its trading partners in the near  future through either a) accepting overseas test 
results, b) introducing simplified procedures, or c)  introducing special assistance programs for foreign 
firms. 
 
Question 14 :  Secretariat Report, page 88, paragraph 52  
 
The Secretariat Report notes the relatively hi gh international call rates in Japan.  
 
What is the assessment of Japan for this situati on, what measures are being taken to address this 
issue? 
 
Question 15 :  Secretariat Report, page 89, paragraph 57  
 
Japan has made much progress in regulatory reform leading to greater market competition; the New 
Competition Promotion Program is a good example.  
 
Korea would like Japan to elaborate on this prog ram, and explain how competition in relevant 
markets is evaluated and how corrective measures ar e implemented. Especially, Korea would like to 
know what measures are taken against the market  dominance maintained by NTT Corporation. 
 Additional Questions 
 
Question 1
:  Government Report, page 14, paragraph 53~54  
 
With respect to the EPAs concluded by Japan, Korea would like to request further clarification on the 
following questions:  
 1) In Japan's perspective, how does an EPA differ in concept to a comprehensive FTA?  
 2) In Japan's EPA, the Bilateral cooperation chapter(section) is generally included in the 
Implementing Agreement, not in the main text of the Agreement. Is this practice due to Japan’s 
interpretation that the Implementing Agreement holds  the same binding power (authority) as the main 
text of the Agreement?   3) It is Korea's understanding that Japan has emphasized the importance of cooperation in its 
Economic Partnership Agreements, and most incl ude a section on SME cooperation. Could Japan 
provide concrete examples of substantive SME cooperation projects that have been devised & 
implemented within the context of its existing EPAs?  
Question 2
:  Secretariat Report, page 55, paragraph 76~77  
 
According to the Secretariat Report, "less than half the personal income is taxed, compared with an 
OECD average of over 80%".  However, it is Ko rea’s understanding that in Japan, the proportion 
(ratio) of tax revenue derived from the personal income tax vis-à-vis the total tax revenue is higher 
than the OECD average figure.  1) Please confirm whether Korea's understanding (that the proportion (ratio) of tax revenue 
derived from the personal income tax vis-à-vis the total tax revenue is higher for Japan than the 
OECD average figure) is correct.  2) (If answer to question directly above is 'y es') Could Japan explain why the ratio of the 
personal income tax to the total na tional tax revenue is higher than the OECD average while the ratio 
of taxpayers subject to personal income tax is lower than the OECD average? WT/TPR/M/211/Add.1 
Page 26  
 
  3) What is Japan's view on the statement by the S ecretariat in para 77 suggesting that Japan is in 
need of broadening the tax base and improving transparency? 
 
4) Does Japan have plans to reform its Income tax and Consumption tax system?  If so, it shall be appreciated if it could provide further information. 
Question 3
:  Secretariat Report, page 34, paragraph 18 (footnote 8)  
 
According to the Secretariat's Report, Japan has imposed temporary tariffs on 477 lines, with rates 
lower than that of general duties, until the end of 2008.  
 1) What was the purpose of imposing temporary tariffs?  2) Could Japan provide an exhaustive list of ta riff lines subject to temporary tariffs and their 
rates in the year 2008? 
 
3) Could Japan explain the procedures for the determination of temporary tariffs? 
 4) Are temporary tariffs still effective in 2009? If so, please specify the lines subject to 
temporary tariffs and their rates. 
 
Question 4
:  Secretariat Report, page 34, paragraph 18  
 
It is Korea's understanding that while in general 'a rtificial textile products for automobile seats' are 
exempt from tariffs, the tariff rate on 'autom obile mats in quadrate form (50cm×150cm or 
100cm×150cm)', usage of which is limited to automobile seats exclusively, is 9.6%.  
 
1) If it can be proven that the seat material was made specifically for automobile seats, can the 
product be granted exemption from tariffs?   2) If so, what will be necessary to demonstr ate this fact (i.e., what is the required 
documentation)? 
 
Question 5
:  Secretariat Report, page 34, paragraph 18  
 
Currently, Japan classifies herbal cigarettes as subs titutes for tobacco, and thus imposes tariffs and 
various taxes such as the tobacco tax.  However, considering that herbal cigarettes aid in smoking 
cessation, it is our view that classifying them into a different category must be reviewed.  
Furthermore, any prohibition on the advertisement of  these products and/or its function/effect should 
be removed. 
 
Could Japan explain its' view on this issue? 
 
Question 6 :  Secretariat Report, page 36, paragraph 19  
 
According to the Secretariat's Report, Japan appli es differential duties and sliding duties to 0.4% of 
the total lines.  
 
(a) Differential duty 
 
1) What is the reason for the imposition of differential duties?   2) Could Japan specify the lines subject to di fferential duties and the mechanism on which the 
imposition is based?  WT/TPR/M/211/Add.1 
 Page 27 
 
 
  3) Is there a possibility that varying the duty amount in accordance with actual prices will reduce 
predictability for taxpayers?  
(b) Sliding duty  
 1) What is the reason for the imposition of sliding duties? 
 2) Could Japan specify the lines subject to sliding duties and the mechanism on which the 
imposition is based.  
3) Is there a possibility that varying the duty amount in accordance with actual prices will reduce 
predictability for taxpayers?  
Question 7
:  Secretariat Report, page 41, paragraph 30  
 It has come to our attention that even for si mple changes in working conditions, pre-liminary 
consultations with the JHTA is necessary, causing unnecessary delays in unloading vessels.  
 In light of the heavy burden of this condition, do es Japan have any plans to ease this requirement to 
facilitate doing-business in Japan's harbors?  Question 8
:  Secretariat Report, page 50, paragraph 58  
 
Korea would appreciate Japan's explanation of its safety screening system for progeny cultivar (stack) 
in GMO products, as well as the present status of the system.  Question 9
:  Secretariat Report, page 50, paragraph 61 
 
Korea would appreciate Japan’s explanation on the requirements for, and any necessary 
documentation (if necessary) for exemption from the labeling requirements for GMO products when these products are exported into Japan.  Question 10
:  Secretariat Report, page 51, paragraph 65 
 
Does Japan have plans to revise its existing statutory regulations on GMO labeling?  If so, Korea would appreciate Japan's detailed explan ation on this matter (content of the revision, 
including the objective of the revi sion, expected timeline, etc.) 
 
Question 11
:  Secretariat Report, page 51, paragraph 65 
 
It is Korea's understanding that Japan's cosmetic re gulations prohibit the use of oriental herb extracts 
in cosmetic products, because such extracts are liste d in the Japanese Pharmacopoeia.  Accordingly, in 
order to export oriental herbal cosmetics or co smetic products containing specific oriental herb 
extracts, it is necessary to obtain a prescription specifically intended for export to the Japanese 
market.  Obtaining such prescriptions incurs extra costs and causes unnecessary difficulties for 
manufacturers.  
In light of this regulation which inhibits the export of cosmetic products with oriental herb extracts to 
Japan, would Japan consider easing this regulation in  the immediate future if such extracts have a 
history of international use?  WT/TPR/M/211/Add.1 
Page 28  
 
  Question 12
:  Secretariat Report, page 51, paragraph 65 
 
The standard process time for the review of quasi-drugs in Japan is six months.  This process time also applies for products that are identical to t hose already approved in terms of active ingredient, 
content (concentration), application met hod, dosage, standard, and test method. 
 
Does Japan have any plans to simplify the review  process for products that have the same active 
ingredient, content (concentration), application me thod, dosage, standard, and test method as products 
that are already approved?  Question 13
 
 
It is our understanding that Japan has recently adop ted a new measure as follows: allowing special 
deduction of 10 million yen (or the total amount of the long-term transfer income of the corresponding year, when the transfer income is less than 10 million yen) from long-term income 
transfers related to transfers of land in the corresponding year, in the case that an individual, holding 
proprietorship of land for more than five years, transfers domestic land acquired between Jan 1, 2009 
to Dec 31, 2010.  Could Japan provide the rationale  for adopting such new measure? 
 Question 14
:  Secretariat Report, page 9, paragraph 25 
 
As far as we know, the branches of foreign banks in Japan are not allowed to engage in both banking 
and trust activities simultaneously.  Also, as is the case in many other countries, in Japan foreign 
businesses are not allowed to engage in the air trans port industry.  According to page 9 paragraph 25 
of the Secretariat Report, however Japan has und ertaken efforts to gradually reduce regulatory 
interventions in several sectors, including th e financial services and air transport services.  
 Could Japan further elaborate on the results of the 'sustained efforts' mentioned in para 25, and provide further information if any c onsideration has been given to the restrictions in the sectors stated 
above?  Question 15
:  Secretariat Report, page 13, paragraph 33 
 
According to page 13, paragraph 33, footnote 39 of the Secretariat report, FDI inflow into Japan in 
2006 was -$6.5 billion (USD).  
 
1) What is Japan's view on this figure? What is Japan's assessment on the reason for this result 
which is vastly different from the figures registered  by the US and EC during the same period?  Is 
Japan of the view that the notion of a "c losed business culture" of Japan a factor?  
 2) Are there any measures being contemplat ed to address the notion referred to above? 
 
In 2007, FDI inflow rebounded remarkably.  3) In the view of Japan, what are the factors that contributed to this sudden turnaround in FDI 
inflow?  Question 16
:  Secretariat Report, page 30, paragraph 60 
 
Korea understands that the Japanese government  has carried out institutional reforms and 
deregulatory measures to improve the investment environment and attract investment from foreign  WT/TPR/M/211/Add.1 
 Page 29 
 
 
  businesses.  However, it is our view that complex non- institutional factors con tinue to hamper foreign 
companies' efforts to enter and participate in th e Japanese market, including in the IT industry, for 
example.  According to reports, due to existi ng tightly linked subordina te relationship between 
procuring firms and the supplying firms, many Japanese companies are prohibited, on a de-facto basis, from engaging in business with new forei gn suppliers.  In our view, these practices serve as 
barriers to market entry for foreign companies ma king it costly to penetrate the Japanese market. 
 What is Japan's view on this issue? 
 
Question 17
:  Secretariat Report, page 30, paragraph 60 
 
According to the Secretariat Report, Japan has a dopted a number of institutional reform measures 
aimed at removing obstacles to FDI. However, our suppliers face seemingly 'nuisance' regulations on 
a daily basis.  
For example, it is our understanding that for a fore ign company to register as a corporation within 
Japan, an address of the corporation is required; t hus, a lease of an office building is needed for 
registration.  However, to lease real estate in Japan, a formal corporate name (registered in Japan) is 
required.  These sort of inconveniences owing to conflicting requirements under law are being 
reported by firms doing business in Japan.  
In connection to the above, has Japan given consider ation to improving foreign investment procedures 
such as that mentioned above?   
Question 18
:  Secretariat Report, page 30, paragraph 60 
 For a foreigner to engage in corporate activities in Japan, one must receive an "Investor/ Business 
Manager" visa or an "Intra-Corporate Transfers" vi sa. But when a parent company wishes to transfer 
an employee to head a subsidiary in Japan by using the "Investor/ Business Manager" visa, the 
employee is required to own a certain portion of the parent company's capital.  So the transfer of 
capital to the employee might be needed, and such  process could cause inconvenience. Meanwhile, to 
receive an "Intra-Corporate Transfers" visa, one must  have been working in the parent company for at 
least a year. This would make it difficult for a company to send newly recruited experts directly to 
Japan.   According to paragraph 60 of page 30 of the S ecretariat Report, the regulations on movement of 
natural persons have been reformed .  Has any consideration been given to the matters stated above? 
(i.e. the easing of the capital holding requirements  or the working period conditions mentioned above) 
 
Question 19
:  Secretariat Report, page 46, paragraph 47 
 
Related to technical regulations mentioned in Pa ragraph 47 of Page 46, under the terms of the 
Electrical Appliance and Material Safety Law, expo rters of digital video recorders are required to 
obtain safety certification for their products.  Th e Japan Quality Assurance Organization (JQA) and 
other domestic organizations test such products and issue safety certificates, as do overseas organizations such as Underwriters Laboratories, Inc.(UL).  However, Japanese buyers demand that 
exporters certify their products only with the JQA, and this generates unnecessary costs.  
 
Does the Japanese government have a ny plans to designate certain foreign organizations which carry 
out the same tests and accept the results on a recipr ocal basis, in a case when foreign governments 
recognize Japan’s safety certification process? 
 WT/TPR/M/211/Add.1 
Page 30  
 
  Question 20
:  Secretariat Report, page 46, paragraph 48  
 
Related to standards mentioned in  Paragraph 48, Page 46, to sell food containers in Japan, it is 
necessary to obtain safety certification from a desi gnated organization.  Any company seeking such 
certification must become a member of the organization, and admission is granted only upon the 
recommendation of an existing member.  However, current members of the association are reluctant 
to write recommendations for foreign companies whic h will then be their competitors; this impedes 
foreign companies from obtaining the necessar y certification to enter the market.  
 Does the Japanese government have any plan s to address/rectify this situation? 
 Question 21
:  Secretariat Report, page 48, paragraph 53  
 
The Secretariat Report indicates that as of 2008 Japan  had 237 regulations pertaining to road vehicle 
safety standards, of which only 27 percent corres ponded to international st andards (compared with 
20 percent of 204 regulations in 2005).  Under this circumstance, we are of the view that it is unfair to 
apply such stringent regulations to special vehicles which operate under certain road and 
environmental conditions.   Is the Japanese government willing to allow the tempor ary operation of special vehicles on the basis 
of reciprocity? 
 
Question 22
:  Secretariat Report, page 49, paragraph 54  
 
Related to the certification system for medical de vices mentioned in Paragraph 54, Page 49, it takes 
more time to register products, including imported medical devices, with Japanese authorities 
compared with those in other advanced countries.  Furthermore, medical devices that have already 
been approved for sale in other countries must go through additional testing before the Japanese 
authorities will approve them; this makes it difficult to enter the Japanese market.  
 Does the Japanese government have pl ans to improve this process?  
 Question 23
:  Secretariat Report, page 51, paragraph 66  
 
Japanese automakers have strong control over car deal erships, which makes it difficult for dealerships 
to carry foreign cars. Also, dealerships provide wa rranties for Japanese vehicles that impede foreign 
carmakers from entering the market. Paragraph 66 of  page 51 states that Japan appears to be putting 
less emphasis on imports promotion. 
 Does Japan agree with this statement? If not, wh at measures have been taken by the Japanese 
government to promote import?   
Question 24
:  Secretariat Report, page 53, paragraph 74  
 
The Japan External Trade Organization (JETRO) has undertaken several export promotion activities 
to assist small and mid-size enterprises.   Could Japan supply the total amount of government  expenditure earmarked to support such export 
promotion activities?  
  WT/TPR/M/211/Add.1 
 Page 31 
 
 
  Question 25 :  Secretariat Report, page 63, paragraph 109  
 
Paragraph 109 of page 63  details, in an indirect manner, the difficulties foreign companies face in 
participating in government funded projects, incl uding for power generation facilities which are under 
a 'closed distribution system'. Large-scale manufact urers having distribution companies as affiliates or 
partners control the first distribution channels, and request Japanese products in their specifications. 
They also procure through their subsidiaries and require vendors to use specific technologies and to 
register similar products separately.  As a resu lt, foreign companies have limited opportunities to 
supply major facilities to Japanese electricity companies.   
What is Japan's view on this issue?  Does Jap an have any plans to rectify this practice? 
 
Question 26
:  Secretariat Report, page 79, paragraph 27  
 
Paragraph 27 states that currently there are no plan s to further liberalize th e Japanese retail market for 
electricity and the authorities plan to review the lib eralization of the electricity retail market in five 
years.   Does the Japanese government intend to promote a wholesale market for electricity to promote competition among power generation companies?  If so, what are the specifics of its plan?   
In Japan, electricity companies monopolize regional markets.  
 Does the Japanese government have a concrete  plan to change this situation? 
 
Question 27
:  Secretariat Report, page 80, paragraph 30  
 
Paragraph 30 states that under the provisions of the Foreign Exchange and Foreign Trade Law, 
foreign entities wishing to invest in the electric ity and gas industries must notify the appropriate 
authorities, including METI.  According to this stipul ation, permission to invest is only denied if the 
investment is deemed a threat to national security; such a case occurred in 2008 for the first time since 
1945.  
 
Could Japan specify under what conditions FDI in th e electricity and gas industries is permitted and 
not considered to be a threat to national security, p ublic order and/or public safety?  Please feel free to 
answer using the only case of 2008 (referred to in the Secretariat Report) as an example.  Question 28
:  Secretariat Report, page 92, paragraph 68  
 
Despite stated plans to simplify customs clearance procedures (Paragraph 25 of page 9) and reciprocal removal of restrictions on entry points (paragra ph 68 of page 92), Korean companies are presently 
facing difficulty at customs because no customs clear ance system has yet been established at Haneda 
Airport (Tokyo International Airport).  At present, eight flights operate between Haneda Airport and 
Gimpo Airport (Seoul) daily.  However, it is impos sible to clear customs at Haneda Airport and 
freight that arrives there must be transported via truck to Narita Airport, generating unnecessary costs 
in the process.  Furthermore, the journey from Hane da Airport to Narita Airport delays the customs 
clearance process by about one day, and since trucks are not loaded to full capacity there is great inefficiency and waste.  To ensure that bilateral trade is fully promoted and all the  necessary support 
system functions smoothly, it is imperative for Ha neda Airport to put in place facilities and systems 
that match the efforts of Gimpo Airport, which alr eady allows direct custom s clearance.  Korea looks 
forward to Japan taking the necessary steps at th e earliest possible juncture to establish a well 
functioning customs clearance system at Haneda Airport.  WT/TPR/M/211/Add.1 
Page 32  
 
  Korea seeks Japan's views to the above. 
 
Question 29
:  Secretariat Report, page 93, paragraph 75  
 
Paragraph 75 of page 93 indicates that questions  may arise concerning the relationship between the 
Anti-monopoly Act and the activities of associations  of qualified professionals which may require 
mandatory membership, and compliance with their rules.  On April 1, 2008, Japan revised its 
Construction Act:  when assessing the level of tec hnology offered by a construction company, Japan 
now assigns additional points to prof essionals who have completed a Ja panese construc tion supervisor 
program (or other Grade 1 technician's class).  The Ac t also stipulates that Japan must award the same 
number of points to any foreign technician deemed  to have completed an  equivalent program.  
However, foreign companies continue to face diffi culties, as there are no specific guidelines clarifying 
which programs are acceptable equivalents and whic h documents their technicians must submit as 
proof of completion.  For this reason, there are calls from our industry on the need to request Japan to set forth, in a prompt manner, specific and clear criteria on this topic. 
 
Could Japan comment on the above?  Are th ere plans to introduce such criteria? 
  
INDIA
 
 1) The secretariat report points out that the Jap anese economy slowed down since the last policy 
review and that the present TPR is prepared at the brink of a recession (Chapter 1, page 1, para.1). 
The IMF and the OECD, for example, expect Ja pan's economy to shrink by 0.2% and 0.1%, 
respectively, in 2009.  It may be useful if the Japanese authorities are able to explain which are the 
sectors of the economy that are most affected by the crisis.  The authorities may also evaluate the 
possible impacts of the present global slowdown on  the economy's external trade in goods and 
services.  Can the authorities explain in which all sectors the recession will be most affecting?  2) Although Japan's FDI inflows increased signi ficantly in 2007, the level of inward FDI 
remains low compared with other developed ec onomies.  FDI outflows increased steadily between 
2005 and 2007 (Para 3, page 3-4, chapter 1).  Japanese authorities may please explain the major 
reasons for a reduced inward FDI and also a sector wise analysis. 
 3) The One Village, One Product (OVOP) is one of  the typical approaches under this initiative. 
OVOP is a movement which supports local econom ies through the development, improvement and 
promotion of local products (foods , beverages, textiles & garments, etc.) with the participation of 
local people. (Page 19, Para 78, 79).  It may be he lpful if Japan could explain which are the products 
covered in the scheme and details  of how it is implemented? 
 4) Improvement of productivity is envisaged th rough implementation of the sector-by-sector 
productivity improvement programme, establishment of an emergency reserve budget for funding 
projects using innovative technolog y, and creation of "super specia l zones" for developing cutting 
edge medical care.  (Para 14, Page 6, Chapter 1) Jap an may explain what is meant by the super special 
zones and how they are going to be implemented?   5) Through its Project to Promote Foreign Direct Investment in Selected Areas, the Government 
supports activities conducted by selected regional gove rnments, include planning of strategies to 
attract FDI.  In FY2004, four regions were selected for such support measures;  by FY2007, 
17 regions had been selected.  In FY2008, the Gove rnment started a project to help in potential 
investors to regional exhibitions, with a view to creating further business opportunities in Japan.  
(Page 31. Para 62, Chapter 2).  It may be useful if  the authorities are able to share information which 
are the selected areas and why they prefer some areas instead at the national level?  WT/TPR/M/211/Add.1 
 Page 33 
 
 
  6) Which are the major areas in wh ich the authorities seek FDI in Japan? 
 7) It would be helpful if Japan could explain how the envisaged tax reform since the previous 
review in 2007 is going to affect the inward FDI and foreign trade of Japan?  
 
8) In FY2008, Japan's tariff schedule comprised 8,841 lines at the HS nine-digit level.  Japan has 
bound 98.8% of lines (108 lines are unbound).  Unbound lines relate mainly to fisheries (fish, crustaceans, and seaweed), petroleum oils, and wood a nd articles thereof.  It may be useful if Japan 
can explain why it keeps these important tariff lines unbound as these are important items in the 
developing countries' export basket. (Page 34 para18 chapter 3). 
 
9) Of the 8,841 tariff lines, 93.3% involve ad valorem  rates;  2.4% are specific, 3.3% alternate, 
and 0.6% are compound rates;  0.4% of tariff lines have other rates (differential duties and sliding 
duties).  A sliding duty involves a specific tariff ra te for imports valued up to a certain threshold 
(Page 36, Para 19 & footnote 10, Chapter 3).  It may be useful if the authorities can explain how the 
threshold limit of sliding duty is fixed?  
 10) According to the Secretariat report (Chapter III, Page 37 Chart 1) footwear items enjoy higher 
level of tariff where India has large export compe titiveness.  Simple average tariffs are considerably 
higher for footwear. (Para23, Page 78) Leather foot wear items are subject to quotas.  Under the TRQ 
(pooled quota) system, an import duty of 17.3% to 24% is levied on import of foot wear within the 
quota threshold.  The import exceeding this quota thres hold is subject to higher rate of import tariff of 
30%.  The TRQ system tends to limit the orders of the Japanese buyers and therefore acts as a non tariff barriers (NTB) to the export of footwear to  Japan.  Would the Japanese government inform by 
when it aims reform in these sectors?   
11) Items such as dairy products, some footwear , and textiles and clothing are not included in the 
GSP scheme for developing countries and are therefor e subject to applied MFN rates of duty.  These 
items are important for the export baskets of devel oping countries and it is useful if Japan can provide 
a clear roadmap on reforms in their present condition.  12) Though the tariff levels of non- agrarian products  of Japan is very low, the products in which 
developing countries has a competitive edge enjoys high protectionism.  Agricultural products receive 
much higher protection than non-agricultural produc ts.  The simple average for agriculture (WTO 
definition) is 18.8% compared with 3.6% for non-ag ricultural products.  It might be interesting to 
know whether Japan envisages a reform on the non ad valorem  duties imposed on agricultural inputs. 
 
13) Tariff rate quotas (TRQs) apply mainly to agri cultural products, including rice, milk and dairy 
products (whey, butter), prepared edible fat, drie d leguminous vegetables, wheat, barley, ground nuts, 
tubers of konnyaku, starches, and silk-worm cocoons  and raw silk. TRQs c over 1.7% of all tariff 
lines. (Page 72 , Para. 10, chapter IV ).  This also  impair the competitive edge of developing countries 
and does Japan have any schedule for effecting reform s in this area to assist developing countries to 
improve access to the Japanese market? 
 
14) The Japanese TRQ regime is a clear violati on of Article XI:1 of GATT, 1994 which stipulates 
that "no prohibitions or restrictions other than dutie s, taxes or other charges, whether made affective 
through quotas,.....shall be in stituted or maintained by any  contra cting party on the importation of any 
product.....".  The Japanese measure is trade rest rictive and acts as a disguise protection for its 
domestic industry. Japan is requested to explai n whether any measures are being considered to 
comply with the GATT, 1994 provisions.  15) Preferential rates of tariff are offere d under the GSP to 142 developing countries and 
15 territories, including additional preferences for 50 least developed countries. (Para 25, WT/TPR/M/211/Add.1 
Page 34  
 
  Page 37,WT/TPR/S/175/Rev.1).  It might be useful to know the criteria followed in granting the GSP 
status to various countries/commodities.  It will be useful if Japan would clarify whether it is using 
same criteria to evaluate products from LDCs and Developed Countries.  
 16) The data on tariff escalation show no overall c onsistent pattern other than that the high level 
of protection granted to agricultural products resu lts in higher overall tariff protection for primary 
products than for semi-processed products.  Tari ff escalation from semi-processed to final goods is 
present in some sectors, notably textiles, petroleum refineries, and non-electrical machinery.  In other sectors, such as food products and manufacturing,  leather products, wood a nd paper products, other 
chemicals, non-metallic mineral products, and metal products, protection for fully processed goods is 
lower than for semi-processed products, while escalation from prim ary to semi-processed and final 
products is evident only for industrial chemicals and rubber. (Table AIII.1). (Para 23, Page 36, 
WT/TPR/S/175/Rev.1).  For developing countries in ge neral and India in particular this pattern of 
tariff escalation may turn as trade distorting. It may be helpful if Japan explain how it can maintain its 
stated objectives of the trade policy in the background of the data on tariff escalation. 
 
17) Japan currently imposes import prohibitions on beef and poultry from various countries due to BSE and avian flu. (Para55. page 45) Japan may please explain which the countries from which the import is prohibited and what are the certification standards that are followed to asses the quality of 
the product?   
18) Preferential Tariffs on industrial products are zero except for sensitive industrial products 
(1,192 items at the HS nine-digit level in 78 pr oduct groups) to which various preferential rates (0%, 
20%, 40%, 60%, and 80% of MFN rates) apply up to  specified ceilings.  The ceilings are open for 
utilization by all beneficiaries.  However, preferential treatment is suspended on a monthly basis when ceilings are reached.  If preferential imports from one beneficiary exceed one-fifth of the total value or 
volume of the overall ceiling, the preferential treatment  for that beneficiary is suspended. (Para 45, 
page 25, chapter II).  It will be helpful if the au thorities are able to furnish the details on how the 
overall ceilings are prepared.   19) From the report of the secretariat it can be  understood that the total budget to import 
promotion measures are on the decline.  It is also  stated that Japan has been placing less emphasis on 
measures to import promotion. (Page 46, Para. 62).  It  will be helpful if Japan can explain what are the 
import promotion measures that exist since the last  review and what is the phase out plan for them. 
 20) Non- ad valorem  tariffs for agriculture (WTO definition) for which AVEs were not available 
concerned 93 tariff lines at HS 9-digit level;  they  included milk and dairy products, live swine and 
meat of swine, rice and cereals, fruit juices, and pr epared foods.  For example, the rate payable on 
imports of peas is among the highest in Japan's customs tariff with an ad valorem  equivalent of 
578.6% (out-of-quota rate).  Many of these products  enjoy comparative advantage for the developing 
countries.  Japan may kindly explain why they are not able to provide AVEs of these tariff lines. (Page 72,Chapter IV, Para 10)  
21) The Government implemen ts "supply-demand adjustment" measures on rice by setting a 
volume cap for rice production. (Page 74, Para13, chapte r IV).  What is the criteria followed for fixing 
the production cap of rice and other important primary pr oducts.  By fixing an artificial level of cap in 
the production of these important primary products  Japan distorts the demand supply adjustment 
mechanism of a free market equilibrium.  We woul d be pleased to have Japan's response in this 
regard.  
 22) It may be useful Japan could explain which are the modes of supply (in services trade) that 
the Japanese economy enjoys a comparative advantag e?  What are the existing barriers on Mode 2 
and Mode 4 trades in services?  WT/TPR/M/211/Add.1 
 Page 35 
 
 
  23) It is reported that given the aging popula tion of Japan, the demand for medical services is 
going to put pressure on the existing health infrastructur e in the country and this can to some extent be 
relieved by easing rules for movement of trained professionals, nurses, physicians etc from India to Japan.  It may be useful for India if the Japane se authorities could explain why there are continuing 
barriers in Mode 2 (consumption abroad) and Mode 4 (movement of natural persons) with regard to 
the trade in health services.  
 24) It would be highly beneficial if Japan could pr ovide data with regard to the import of Mode 2 
(consumption abroad) health services.  
25) The Japanese authorities may please clarify how many items are subjected to import quota 
and under import license.  26) Procurement under the basic guidelines must be ¥500 million or less per contract.  Any planned procurement exceeding this threshold must be separated or divided.  The authorities expect 
these measures to improve transpar ency in Japan's procurement pr ocess.  Japan may please explain 
how the procurement threshold leve l is fixed. (Para 42 page 44.) 
 27) It may be useful if the Japanese authorities are able to provide the details of export promotion 
schemes like Subsidies, export finance, insurance,  and guarantees etc. (Para 73 page 53).  Similar 
details of export credit will also be useful. 
 
28) Japan is a net food importer from the worl d and self-sufficiency in Japan is just 40%. 
However, still India's agricultural exports to Japan ar e not very high.  This is attributed to various 
restrictions imposed by Japan.  Indian tea, rice a nd wheat producers say that Japan imposes very strict 
regulations with regard to pesticide and chemical residues in these items.  Similarly, meat and meat 
products exports to Japan face difficulties on account of stipulations that ban use of natural and 
synthetic hormones in livestock production.  Indi a would appreciate to be  informed if these SPS 
requirements are science-based and aligned which specific international standards?  29) Although rice apparently is the most impor tant commodity, the quantum of the subsidies 
provided for rice was not made available to the Secretariat.  Japan may explain the reasons for not 
providing the details to the Secretariat.  It would be  useful if Japan can explain how the subsidies that 
are provided to various other food crops are not trade distortive.  30) In-quota imports of rice, wheat and barley, and certain milk products are handled mainly by state-trading entities.  However, certain amounts of these products may be imported by private 
entities.  It may be helpful if the authorities can explain the intention in providing the import right of 
these important commodities to state trading author ities in which the developing countries have a 
comparative advantage.  How much quantum of them  can be handled by the private entities and what 
is the criterion of division?  31) Japan was the 3
rd largest trade partner of India in 1990-91 (8.30%of India's total trade).  By 
2000-2001 Japan became the 5th trading partner of India (3.82).  By 2006-07 Japan is no where among 
the top 10 trading partners of India. (DGCIS, 2007).  What are possible reasons for this steady decline 
in Japan-India trade?  What step Japan envisages to take to regain market position it enjoyed earlier in 
India?  
32) Japan's pharma market is around US$60 billion.   Out of which around US$10 billion is being 
imported.  But for the developing countries access to Japans' market is nearly non-existent due to non-
tariff barriers.  Besides the secretariat report (Para 34, Page 32, Chapter III) poi nts out that some items 
in this category need conformation at customs as these items come under import surveillance.  Japan WT/TPR/M/211/Add.1 
Page 36  
 
  may please explain what are the possi bilities for reforms in this area  to assist pharma industry of 
developing countries to export to Japan?   33) Products of the "alternative medical system" (e .g. Ayurveda, Unani, etc.) are in high demand 
in Japan.  What is the procedure for import of these items in Japan? 
 
34) For import of cosmetics products, Japan requires obtaining a license from the Ministry of Health and Welfare.  The ministry uses a pre-define d list of items that can be used as ingredients in 
the production of these products which act as barriers.  Why manufacturers are not given the freedom to choose the ingredients as long as the ingredients c hosen are safe for human use?  Japan may please 
inform what steps are being considered in this regard. 
 35) Indian companies face barriers in the sector s like pharmaceuticals in the form of the practice 
of the requirement of partnering with Japanese en terprise/trading houses for local marketing.  This 
escalates costs for the Indian manufacturers as they do not have a product profile at the beginning.  
What are the steps proposed to be taken by th e Japanese authorities to resolve this problem?  
 36) Pharmaceutical export compani es are expected to keep an inventory of product for five years 
which result in huge losses afterwards.  More over the exporting companies feel that mandatory bio 
equivalence testing on the Japanese population fo r each generic product also increases the cost 
tremendously.  Although Japanese law allows for generic medicine substitution, in practice doctors do 
not prescribe substitution drugs.  By when is the Japanese government considering reforms in these 
areas to get the best generic products at a lo w price for the benefit of Japanese patients? 
 37) Websites, linkages to websites and informati on related to Pharmaceutical imports are all in 
Japanese language.  What are the st eps proposed to be taken by the Japanese authorities to solve this 
problem by making available vital info rmation available in English language? 
 38) Japan imposes strict quotas for import of items like squids, seaweed, mackerel, sardine, herring etc.  A number of vitamins and products c ontaining vitamins are treated as food products and 
are accordingly subjected to stringent SPS measures.  What is the justification for such a treatment?  
What are the Japanese Government plans to  initiate time bound reforms in these areas? 
 
39) The rules governing imports of fruits and vegeta bles into Japan are excessively restrictive and 
at times stricter than those applicable in other deve loped nations.  What is the justification for such a 
treatment?  
40) In case of processed food items, the presence of  additives used for preservation or enhancing 
the product quality and life and otherwise considered  safe are objected to by authorities in Japan.  
What is the justification for such a treatment?  41) Withholding tax is a major issue in service e xports to Japan.  Indian IT service companies 
have complained about the 15% withholding tax imposed by Japanese authorities on payments from 
Japanese firms to the Indian IT service compan ies labeling the same as 'fees for technical 
consultancy'.  What are the plans to repeal this tax?  42) Obtaining visa's for employees to do on-site wo rk in Japan is a problem faced especially by 
companies in the IT sector.  What steps Japan propose to take to mitigate this problem?  
  WT/TPR/M/211/Add.1 
 Page 37 
 
 
  Additional Questions 
 
Q 1. During the last Trade Policy Review Japan had informed that under its new TPPRR (Three-
year Program for Promoting Regulatory Reform) it  would take the following measures relating to 
movement of natural persons: 
 
 (a) Review its immigration control measures, including concrete measures of accepting 
those who have special knowledge and skills. 
 (b) Review the existing system for the expansion of entry of foreign IT engineers,   (c) Clarify the status of residence of "Investors/Business Managers" and make even more 
accessible the information on the status of residence of "Intra-company Transferees", 
and 
 (d) Make guidelines on the requirements for the status of residence of "Permanent 
Resident". 
 
The concrete steps taken by Japan on these measures re lating to movement of natural persons may be 
detailed.   Q 2. In the last TPR Japan had informed that, "W ith a view to facilitating the movement of natural 
persons, Japan has a list of eight trading partners  (China, Chinese Taipei, the Republic of Korea, 
Malaysia, Myanmar, the Philippines, Singapore, and Vi et Nam) whose examinations or qualifications 
of IT engineers are recognized by the Japanese  Immigration as eligibility criteria to obtain the 
residence status of "engineer"."  Japan may elucid ate the criteria for recognition of qualification by 
the concerned Japanese Ministry.  Q 3. In its Revised Offer the period of stay for an intra-corporate transferee has been reduced from 
five years to 'one or three years, which may be  extended'.  The same is the case for Contractual 
Service Suppliers and Independent Pr ofessionals.  Could Japan clarify wh at 'one or three years' means 
and why this should not be considered as a roll back?    Q 4. What are the requirements for opening up of a foreign bank branch in Japan?  The details may 
be provided.  Is there a minimum prescribed peri od for processing an appli cation for opening up of 
foreign bank branch?  
 Q 5. Are there difficulties being faced by forei gn bank branches in running their day to day 
operations in Japan?  This becomes significant b ecause as per the report of the Secretariat, "At 
end-February 2008, there were 214 banks;  64 were  foreign (Table IV.4), five fewer than at 
end-February 2006." (para 36 page 82).  Further, as per Table IV .4 (page 82) on Financial institutions, 
2008 foreign banks as a percentage of all banks in  Japan are 30% and total assets of these foreign 
banks are only around 7% of the to tal assets of all banks in Japan.  
 Q 6. It is understood that as per the ordinance of  the Japanese Ministry of Finance, establishment 
of identity of corporate in respect of loans/inv estments under KYC norms is exempted if the company 
is registered in the Stock Exchange of only some  countries.  If it is correct, Japan may explain the 
reasons for such differential treatment.  Q 7. In its Revised Offer no improvements have been  offered by Japan in the movement of natural 
persons in the area of medical services and other professional services such as R&D Services, 
recreational services etc.  Is Japan considering offering any improvements in these areas?  
 Q 8. The term "contractual services suppliers" is used  but not defined as per the plurilateral request 
on Mode 4 made to Japan.  Further, the Immi gration Control and Refugee Recognition Act is 
incorporated by reference.  Could Japan info rm whether it is considering conforming to the WT/TPR/M/211/Add.1 
Page 38  
 
  plurilateral request?  Further as per Japan's offer C ontractual Services Suppliers (CSS) is limited in its 
coverage is there any propo sal to expand the coverage?  
 Q 9. Given the fact that Japan's Immigration Control Act is much more liberal in allowing entry of natural persons (i.e. Medical Services, Researchers,  Entertainers and Skilled Labour) into Japan than 
it offer at the WTO, is Japan proposing to expand the same and if not why?  
 Q 10. It is understood that for a number of sect ors for Mode 1 there is a requirement of 
establishment.  Japan may provide detailed regulations  in English with respect to the sectors in which 
Mode 1 requires commercial establishment. 
 
Q 11. The category of Independent professionals has not been defined as per the plurilateral request 
on Mode 4 to Japan.  Further, commitments in Independent Professionals are for a very limited 
number of professions (legal, accounting, auditing and bookkeeping and taxation) which also are 
subject to domestic qualification requirements a nd procedures.  Does Japan propose to expand its 
commitments in Independent Professionals? 
 Q 12. The same restrictions in Mode 1 and 2 in Professional services apply, as was the case in the Uruguay Round except that they are listed in the Ma rket Access column.  Any plans of removing the 
restrictions?  
Q 13. In Primary Educational Services, the new c ondition that excludes nurser y schools seems to be 
a rollback since the UR commitment included kindergarte ns.  This confusion is aggravated by the fact 
that footnote 21 includes the category of kindergart ens.  We would appreciate clarification in this 
regard.  
Q 14. Is there any possibility of expanding the c overage for Independent Professionals, which is 
restricted to Legal, Accounting, Auditi ng and Bookkeeping, and Taxation services? 
 Q 15. The Secretariat's Report states that nearly 99% of all tariff lines in Japanese Tariff Schedule 
are bound.  Which are the unbound items in Japanese Tariff Schedule?  Please furnish the applied duties on these items. 
 
Q 16. It has been stated in the Secretariat's Report that in the case of agricultural products, 
accounting for 6.7% of all tariff lines, non- ad valorem  duties tend to involve high ad valorem 
equivalents.  Will Japan indicate the range of ad valorem duty incidence for these items?  Also, please 
indicate, in descending order, the ad valorem  incidence of duty on 10 top agricultural items (in terms 
of duty incidence). 
 Q 17.  The Secretariat Report states that Japan app lies some import prohibitions and quantitative 
import restrictions on certain items.   What is the nature of such prohibitions and restri ctions? Are restricted goods different from prohibited 
goods and if so, in what respect? Will Japan furnish the list of goods that are subject to prohibitions 
and restrictions? It would be useful if Japan c ould also indicate the nature of prohibitions and 
restrictions against each item.  Q 18. The Secretariat Report states that in 2006, th e average time between arrival of goods and the 
granting of import permission was 63.8 hours (2.7 days) for sea cargo and 14.4 hours (0.6 days) for 
air cargo.  In this connection, India would like to know the average time taken by the agencies 
concerned for their allotted activities which taken toge ther resulted in the dwell time of 2.7 days for 
sea cargo.    WT/TPR/M/211/Add.1 
 Page 39 
 
 
  What is the present dwell time for import cargo i.e.  the average time taken for clearance of import 
cargo?  Please apportion the time taken by the various agencies/importer. 
 
Q 19.  It has been stated that with the adoption of the amendment to the Customs and Tariff Law as 
on 31 March 2008, the overtime charge system was abo lished.  Please explain the rationale for and the 
purpose of this overtime charge system.  Does this mean that after abolition of the overtime charge 
system, no overtime charge will be collected by the Customs and other government agencies for the 
work performed beyond normal office hours and on Sa turdays/Sundays/other public holidays?  Please 
provide details.  
Q 20.  What is the eligibility criterion for the grant of  Authorized Economic Operator (AEO) status?  
Does the compliance record mentioned at pages 34  and 52 refer to importer's/exporter's compliance 
with Customs requirements or the importer's/expor ter's compliance with Customs and other allied 
laws?  What are the additional facilities granted to  the AEOs that are not available to the normal 
importers/exporters?  Is the AEO based on any international standard?  Does Japan use risk 
management techniques in the assessment of any applications for grant of AEO status? 
 
Q 21. It has been stated at the footnote 5 that Cu stoms clearance fees include an inspection fee, if 
inspection is at a place other than a designated area (¥5,000/hour).  Under Article VIII of the GATT, 1994, all fees and charges imposed on or in connection with 
importation or exportation shall be li mited in amount to the approximate cost of services rendered.  In 
this connection, India would like to know whethe r the inspection fee of ¥5,000/hour represents the 
cost of services rendered, or some other elements are al so included in this fee.  What are the other fees 
included in the customs clearance fees apart from th e inspection fee?  Further, India would like to 
know whether the Customs clearance fees are also charged for the work performed at the hours 
beyond the normal working hours and on Satu rdays/Sundays and other public holidays. 
 
Q 22.  It has been stated that written advance rulings  are issued at the written request of importers 
and other parties concerned.  In this connection,  please clarify as to what information is necessary 
from the applicant to issue an advance ruling, th e time period by which the Advance Ruling Authority 
will issue an advance ruling and the length of tim e for which the advance ruling will be valid.  Who 
can ask for an advance ruling and what are the e ligibility criteria?  What are the subjects covered 
under advance rulings?  Does advance ruling cover bo th imports and exports?  Does the Japanese law 
provide for a review by the Advance Ruling Author ity of the advance ruling or the revocation or 
modification of the advance ruling?  Please provide details. 
 
Q 23. The Secretariat Report states that the aut horities are planning to introduce the Common Portal 
for the Next Generation Single Window in October 2008.  The portal is intended to unify electronic 
application formalities among various agencies;  the authorities expect  that it will increase efficiency 
by allowing data-sharing among the agencies concerned.  Please indicate whether the said Common Portal has been introduced and if so, the details thereof may kindly be provided.  
Q 24. The Secretariat Report states that three law su its were filed in 2006 and three in 2007.  Please 
explain the nature of a law suit.  Are law suits filed against the decisions taken by the Director-General of Customs?  Can't the im porter/exporter file a law suit against Customs' decisions (lower in 
rank than DG, Customs) directly in the Japanese courts in the form of a writ?  
 
Q 25. It has been stated that impo rts are valued according to their c.i. f. value (which is taken to be 
the transaction value of the imports).  Footnote 10 at page 36 states that a differential duty involves a specific rate charged per kg of imports with the rate  varying directly with the difference between the 
standard import price set by the authorities, and actual import price.  Please explain the concepts of WT/TPR/M/211/Add.1 
Page 40  
 
  the 'standard import price set by the authorities' and the 'actual import price'.  What are the goods that 
attract differential duties?  
Q 26. Under the WTO Agreement on Customs Valuati on, the primary basis for customs value is the 
'transaction value' as defined in Article 1.  I ndia would like to know as to how the valuation method 
linking the collection of duty to the standard import price fits into the valuation methods enshrined in 
the said Agreement.  Also, please explain how the standard import price is set by the authorities. 
 Q 27. The Secretariat Report states that under Article 19 of the Customs Tariff Law, tariffs on raw materials used in the production of export goods by factories approved by Customs may be reduced, 
exempted or refunded (by a drawback scheme).  Ther e has been no change to the list of goods subject 
to tariff reduction, exemption, or refund since th e previous Trade Policy Review of Japan.  Please 
provide the details of drawback scheme.  Also, please furnish the list of goods subject to tariff 
reduction, exemption or refund, showing separatel y the goods that are subject to tariff reduction, 
exemption or refund.  
Q 28. Does the drawback scheme allow drawback of  duties and taxes paid on energy, fuel and oil 
used in the production process and catalysts which ar e consumed in the course of their use to obtain 
the exported product?  What is the methodology adopt ed for refund of input taxes under the drawback 
scheme?  Please indicate separately the methodology adopted for refund of taxes on inputs that are 
physically incorporated in the exported products a nd the inputs like energy, fuels, oil and catalysts 
which are used in the production process to obtai n the exported product.  How the drawback amount 
is calculated and refunded when a given input im ported under an invoice is used not only in export 
consignments spread over a period of time but also  in the production of goods meant for home use? 
 
 
CHINESE TAIPEI
 
 
Report by the WTO S ecretariat (WT/TPR/S/211)  
 I. ECONOMIC ENVIRONMENT 
(1) M
AIN ECONOMIC DEVELOPMENTS  
 
(page 1, Table I.1, page 4 paragraph 5 & page 5 paragraph 10) 
The fiscal deficit of Japan amounted to around 3.4%  of GDP in FY 2007, while the public debt also 
increased to reach 170.6% and 173.0% respectivel y in 2007 and 2008.  The Japanese parliament 
allocated ¥1.81 trillion for "Comprehensive Immediat e Policy Package" in the first supplementary 
budget for 2008, and the second supplementary budget of  ¥2 trillion is currently under review by the 
House of Councillors.  In the present unfavourable ec onomic climate, it will be difficult for the Japan 
government to achieve its goal of stabilizing th e debt-to-GDP ratio before reducing it in the 
mid-2010s, as announced in its "Directi on and Strategy" in January 2007.  
 
1) In this context, we would like to know whether the Japanese government is thinking of 
adjusting the above goal, and if so, to what extent?   
2) Considering the fact that Japan faces the acute  fiscal situation of a rapidly aging population, 
which requires escalating expenditure on healthcare and pensions now and in the future, if it is still to 
maintain the above-mentioned goal, what measures is Japan taking to retain the momentum of 
financial reform? 
  WT/TPR/M/211/Add.1 
 Page 41 
 
 
  II. TRADE POLICY REGIME: FRAMEWORK AND OBJECTIVES  
(2) T RADE POLICY OBJECTIVES  
 
(page 16, paragraph 8) Japan supports the "open regionalism" approach of the Asia-Pacific Ec onomic Cooperation (APEC) 
forum, and participates in various other regional tr ade fora, such as the Asia-Europe meeting (ASEM), 
the ASEAN+3, and the East Asian Summit.  
 
Could Japan please advise us of whether it intends  to join the "Trans-Pacific Strategic Economic 
Partnership Agreement" between New Zealand, Chil e, Singapore and Brunei, and of its rationale for 
joining or not joining,  whichever is the case? 
 (4) T
RADE AGREEMENTS AND ARRANGEMENTS  
(ii)  Regional agreements 
 
(pages 21-27, paragraphs 18-44) 
Japan has already signed "Economic Partnershi p Agreements" (EPAs) with Singapore, Mexico, 
Malaysia, Chile, Thailand, Indonesi a, Brunei, the Philippines, ASEAN, and Viet Nam.  It has also 
entered into EPA/FTA negotiations with the GCC,  Korea, India, Australia, and Switzerland.  
 
Could Japan please describe for us how it has work ed to achieve a balance between the multilateral 
negotiations under way in the Doha Round and the various regional trade agreements that it has 
signed, or is negotiating, without the complica tion of the so-called "spaghetti bowl effect" on the 
world trading system? 
 (page 22, paragraph 22 & page 25, paragraph 37)  
As part of Japan's trilateral cooperation with Chin a and the Republic of Korea, joint research on a 
possible FTA has been conducted.  In November 2007, a report was is sued which states that such an 
FTA would have positive effects for all the three c ountries.  Joint research on possible roadmaps for a 
trilateral FTA was conducted in 2008;  and in August 2008, the third workshop of the year was held in 
Beijing. 
 
It is our understanding that Japan and Korea also  held working-level cons ultations in June and 
December of 2008 to "consider a nd create a favourable environment for the resumption of 
negotiations."  
 1) What is Japan's position and strategy on the resumption of the Japan – Korea FTA and on the 
possible trilateral FTA between Japan, Korea and China?  
 2) Does Japan make any priority between the two FTAs?  
 
3) How can a balance be struck between the two FTAs? 
 
III.  TRADE POLICIES AND PRACTICES BY MEASURE 
(2) M
EASURES DIRECTLY AFFECTING IMPORTS  
(i)  Customs clearance procedures 
 (page 33, paragraph 13) 
We commend Japan on its efforts to reduce the cargo clearance time.  We also note that the clearance 
time measured by Japan is somewhat different fro m the WCO's Time Release Study, which estimates 
with some precision the time required for each inte rvening event of all the formalities completed 
between arrival and release of the goods, i.e. unl oading, storage, presenting the declaration, 
inspection, release and the removal of the goods to the company, etc. WT/TPR/M/211/Add.1 
Page 42  
 
  Could Japan please explain why its Customs only measures the time until the release of the goods, 
and does not measure the time between the arrival of  goods and the importer's claim for the goods and 
removal of the goods? 
 
(page 34, paragraph 16) 
We note that Japan was planning to introduce the Common Portal for the Next Generation Single Window in October 2008.  The porta l is intended to unify electroni c application formalities among 
various agencies.  The authorities expect that it w ill increase efficiency by allowing data-sharing 
among the agencies concerned. 
 We would appreciate having further information on the following aspects:  
 
1) If the Common Portal for the Next Genera tion Single Window has already been introduced, 
could Japan please provide details on how it works and which agencies are involved? 
 
2) If the Portal includes the issuance and transmis sion of electronic certificates of origin (eCOs), 
with a view to further facilitating trade, we would be interested in Japan's views on the subject of 
cross-border eCO exchanges with major trade partners. 
 
(4)
  M EASURES AFFECTING PRODUCTION AND TRADE  
(iii) State-owned enterprises, corporatization, and privatization 
 (page 56, paragraph 82) 
The government of Japan still held shares of certain  Public Corporation such as Nippon Telegraph and 
Telephone Corporation (NTT), Japan Tobacco Inc.(J T), Japan Petroleum Exploration Co. Ltd. and 
some commercial banks in March 2008.   
 
1) Is there any dominant regulation that preven ts these Public Corporations from impeding 
market competition?   Japan's government has adopted the Reorganizati on and Rationalization Plan, with 43 Public 
Corporation having been privatized since December 2001.  
2) Is it planned to set a privatization schedule for Public Corporations in the future? 
 
IV. TRADE POLICIES BY SECTOR 
(4) E
NERGY AND UTILITIES  
 (page 79, paragraph 27) 
The authorities do not currently plan to liberalize furt her the retail market for electricity.  What are the 
concerns of the Japanese authorities?  In the future , is it possible to expand the scope of liberalization 
to include 50kW or less for consumer use?  (page 80, paragraph 30) 
The report indicates that permission for foreign investment is not denied, except on grounds of 
national security.  In 2008, the authorities recomme nded against one request for such permission on 
grounds of "national security, public order a nd public safety", for the first time since 1945. 
 
Could Japan please provide further information on this case to us and other WTO Members as a 
reference for future investor s in electric and gas utilities? 
  WT/TPR/M/211/Add.1 
 Page 43 
 
 
  (5)  S ERVICES  
(iii) Telecommunications  
(Page 88, Paragraph 52) The NTT Corporation continues to dominate Japan's  telecommunications market with 91.3% share of 
the local telephone services market and 37.4% of the DSL service.   
Could Japan please provide more information on tariff regulations, in particular regulatory measures 
on leased-circuit fees and Internet service providers' (ISPs) peering fees, which aim at ensuring fair 
competition between new common carriers (NCCs) a nd NTT, as well as between Internet access 
providers (IAPs) and NTT?  (iv) Transport 
(a)  Maritime transport  
(page 91, paragraph 63) 
The amended Marine Transportation Law entere d into force on 17 July 2008, introducing, inter alia , 
"tonnage tax" in international maritime transport.  This is in order to enable Japanese shipping 
companies to compete with foreign companies on a level playing field in the international shipping market.   
 
1) We wonder whether the tonnage tax runs counter to the fairness principle of taxation, and we 
would appreciate knowing how the Transport au thority convinced the Revenue authority? 
 
2) In addition, could Japan please provide details of the regulations relating to the tonnage-tax 
and application requirements, as well as othe r related regulations, for our reference? 
 
(v) Professional services 
 
(page 93, paragraph 75) 
We note that, in addition to obta ining relevant licences, membership  in a professional association is 
compulsory for:  certified public accountants, administ rative scriveners, lawyers,  judicial scriveners, 
land and house surveyors, licensed tax accounts, public consultants on social and labor insurance, and 
patent attorneys.  
 
Is there is any specific qualification regarding nationality or residence required of the above-
mentioned professionals for them to be able to  join any of these professional associations?  
 
Report by the Japan Government (WT/TPR/G/211)
 
 
2. Trade and economic policy environment  
(3) Trends in foreign direct investment  
 
(page 7, paragraph 13 )  
In May 2008, the Expert Committee on FDI Promotion issued Five Recommendations Towards the 
Drastic Expansion of Foreign Direct Investment in Japan , one of which is entitled "Comprehensive 
studies on Foreign Direct Investment regulations".  
Is Japan intending to revise any of its Foreign Di rect Investment regulations in any of the areas 
covered by the aforementioned recommendations?  If so, could Japan please indicate to us what are 
the key points of the revision? 
 
 WT/TPR/M/211/Add.1 
Page 44  
 
  COLOMBIA
 
 
Informe de la Secretaría WT/TPR/S/211 
 I. ENTORNO ECONÓMICO 
3) P
OLÍTICAS ESTRUCTURALES  
 
"14. Está previsto mejorar la productividad me diante la aplicación del programa sectorial de 
mejora de la productividad, el establecimiento de un presupuesto de r eserva para emergencias 
destinado a financiar proyectos que utilizan tecnología innovadora, y la creación de "zonas 
superespeciales" para desarrollar un sist ema puntero de atención sanitaria.". 
 
¿En qué consiste el Programa Sectorial de Mejora de la Productividad y a qué sectores está dirigido? 
 ¿Qué son las "Zonas superespeciales" para desa rrollar un sistema puntero de atención sanitaria? 
 
¿La atención sanitaria en las zonas superespeciales incluye productos importados? o ¿Está dirigida a 
productos japoneses destinados al mercado local y/o a la exportación?  ¿Cuántas y en donde estarían ubicadas las zonas superespeciales? 
 
II. RÉGIMEN DE POLÍTICA COMERCIAL: MARCO Y OBJETIVOS 
3) F
ORMULACIÓN Y EVALUACIÓN DE LA POLÍTICA COMERCIAL  
ii) Evaluación de la Política Comercial   
"12. El 1º de octubre de 2007 se introdujo oficia lmente un procedimiento de  análisis del impacto 
de la reglamentación, cuya finalidad es predecir el efecto y las cargas derivadas de la aplicación de la 
reglamentación, con el nombre de "evaluación ex ante  de la reglamentación".  Con arreglo a la GPEA, 
los organismos administrativos deben así mismo efectuar una evaluación ex post…." 
 
¿Cuál es la experiencia de Japón en el desarrollo de l "Procedimiento de Análisis de Impacto de la 
Reglamentación" con otros países, especialmente c on países en desarrollo como Colombia?  ¿Cuál 
sería el procedimiento a seguir para conocer  la información acerca de dicho análisis? 
 
III. POLITICAS Y PRÁCTICAS COMERCIALES. POR MEDIDAS 2) M
EDIDAS  
 
"14. Con arreglo a la ley de aduanas…;  todos  los importadores deben presentar una declaración de 
aduana.  Con respecto a la mayor parte de las merc ancías, la declaración ha de presentarse después de 
que las mercancías hayan entrado a una zona Hoze i (Una zona Hozei es una zona especialmente 
designada por el Ministerio de Hacienda para almacenar mercancías importadas o mercancías  destinadas a la exportación… Hay cinco tipos de zona Hozei: zona Hozei designada, almacén Hozei, 
almacén manufacturero Hozei, zona Hozei de e xposición, y zona Hozei integrada ….".   
 
¿En qué consiste una zona Hozei in tegrada? ¿A qué derechos de a duana o cargas de cualquier otra 
clase aplicadas a la importación están sujetas las mercancías almacenadas en dichas zonas? ¿Qué 
incentivos se otorgan a quienes se establecen en dichas zonas? ¿Cómo se vigila la observancia de las 
reglas del ADPIC en dichas zonas? 
¿Cuáles son las características de los cinco tipos de zona Hozei? 
  WT/TPR/M/211/Add.1 
 Page 45 
 
 
  III. POLITICAS Y PRÁCTICAS COMERCIALES. POR MEDIDAS 
4) M EDIDAS QUE AFECTAN LA PRODUCCIÓN Y AL COMERCIO  
iv) Derechos de Propiedad Intelectual   
"85. Desde el anterior examen de las políticas co merciales del Japón se han introducido una serie 
de enmiendas a las principales leyes de protección de  los derechos de propiedad intelectual. En 2006 
se modificaron las leyes sobre propiedad industrial (esto es, Ley de Dibujos y Modelos, Ley de Patentes, Ley de Modelos de Utilidad y Ley de Ma rcas de Fábrica o de Comercio) y la Ley de 
Prevención de la Competencia Desleal;  las leyes mo dificadas entraron en vigor en abril de 2007.  La 
Ley de Dibujos y Modelos modificada aumentó el plazo máximo de protección para los dibujos y 
modelos desde los 15 a los 20 años a partir de la  fecha de su registro y aumentó la protección de 
determinadas imágenes gráficas por ordenador…."  ¿Qué imágenes gráficas por ordenador fueron objeto de una mayor protección en virtud de la Ley de 
Dibujos y Modelos?  
 
"92. El 31 de mayo de 2007 la Sede de Políti ca de Propiedad Intelectual adoptó el Programa 
estratégico sobre propiedad intelectual (IPSP) de 2007 , que, entre otras cosas, estipulaba que el Japón:  
formularía "programas estratégic os" para la protección de derec hos de propiedad intelectual en 
determinados campos (por ejemplo, las ciencias de  la vida, la tecnología de la información y las 
comunicaciones, el medio ambiente y la nanotecnologí a/los materiales);  fomentaría la armonización 
internacional del sistema de patentes a través de medidas como la normalización del modelo de 
solicitud de patentes entre las Oficinas Trilaterales (O ficina de Patentes del Ja pón, Oficina de Patentes 
y Marcas de los Estados Unidos y Oficina Europea de Patentes);  y reforzaría las medidas de observancia de la legislación relacionada con los DPI y las medidas en frontera por parte de la 
Aduana.  El 18 de junio de 2008 la Sede de Política de Propiedad Intelectual publicó el Programa 
IPSP de 2008, que revisará desde la perspectiva in ternacional la estrategia en materia de propiedad 
intelectual.  La revisión se centrará en:  fortalecer  la competitividad internacional del Japón en los 
campos estratégicos elegidos como prioritarios;  estimular la expansión de la actividad comercial 
internacional;  y ejercer el liderazgo en el tratamient o de cuestiones mundiales comunes, en particular 
aquellas a las que hacen frente los países asiáticos.".  
¿Cuál es la naturaleza jurídica de la Sede de Políti ca de Propiedad Intelectual? ¿En qué consiste el 
Programa Estratégico sobre Propied ad Intelectual (IPSP) de 2007? 
 
II. III. POLITICAS Y PRÁCTICAS COMERCIALES. POR MEDIDAS 
4) M
EDIDAS QUE AFECTAN LA PRODUCCIÓN Y AL COMERCIO  
vi) Política de Competencia c) Exención del mantenimiento del precio de  reventa con respecto a la Ley Antimonopolio. 
 "112. El sistema de mantenimiento del precio de reventa sigue estando exento de la Ley 
Antimonopolio en el caso de las obras amparadas por de rechos de autor (libros, revistas, periódicos, 
discos de vinilo, casetes musicales, grabaciones y CD).   Las autoridades consideran que, desde el 
punto de vista de la política de la competencia, de bería suprimirse esta exención;  sin embargo, no hay 
un consenso nacional, pues muchos sostienen que ta l abolición podría afectar negativamente a los 
valores culturales y/o la "vertiente pública" de las obras amparadas por el derecho de autor.". 
 ¿En qué consiste la exención al sistema de manten imiento del precio de reve nta otorgada a favor de 
las obras amparadas por el derecho de autor? 
 WT/TPR/M/211/Add.1 
Page 46  
 
  IV. POLITICAS COMERCIALES, POR SECTORES 
5) S
ERVICIOS  
i) Visión general  
"32. Con arreglo a los estudios del Gobierno sobre la productividad, si bien el crecimiento de la 
productividad del trabajo en el sector de servicios ti ende a ser inferior al sector manufacturero en la 
mayoría de los países avanzados, la diferencia de  productividad entre ambos es especialmente notable 
en el Japón.  Un estudio llevado a cabo por la Of icina del Consejo de Ministros muestra que la 
productividad del trabajo en el Japón ha quedado rezagada en comp aración con la de los Estados 
Unidos, especialmente en el ámbito del comercio mayorista y minorista, el transporte y el 
almacenamiento, los hoteles y restaurantes y los ser vicios prestados a las empresas.  Un estudio 
realizado por el Ministerio de Asuntos Internos y Comunicaciones indica que el coeficiente de crecimiento medio anual de la productividad total de los factores en el sector de la información y las 
comunicaciones fue del 2,42 por ciento entre 1995 y 2005, mientras que el promedio correspondiente a "todos los sectores" fue del -0,07 por ciento.  El cr ecimiento de la productividad total de los factores 
en otros sectores fue del:  -0,39 por ciento en transpor te;  -0,07 por ciento en el comercio minorista;  
0,04 por ciento en el comercio mayorista;  -0,03 por ciento en la construcción;  -0,41 por ciento en la 
fabricación de vehículos;  y 1,90 por ciento en la  maquinaria eléctrica.  A fin de abordar cuestiones 
horizontales en el sector de los servicios, en mayo de 2007 el sector empresarial creó una organización llamada Productividad de los Servicios e Innovación para el Crecimiento (SPRING)". 
 
¿Podría indicar cuáles son los objetivos que persigue la organización SPRING? ¿Cuál es la 
interacción de dicho organismo con el sector públic o? ¿De qué forma se articulan las actividades que 
emprende este organismo con las políticas sectoriales del Gobierno? (La página Internet suministrada 
en el informe de la Secretaría se halla escrita en caracteres e idioma japoneses). 
 
IV. POLITICAS COMERCIALES, POR SECTORES 
5) S
ERVICIOS  
iii) Telecomunicaciones  
 
"52.  El sector de las telecomunicaciones represen tó el 2,0 por ciento del PIB del Japón en 2006 
(2,1 por ciento en 2005).  En cuanto al comercio transfronterizo, las exportaciones de servicios de 
telecomunicaciones aumentaron de 50.600 millones de yenes en 2006 a 65.200 millones en 2007, en 
tanto que las importaciones crecieron de 85.100 mill ones de yenes a 121.000 millones.  Entre agosto 
de 2006 y febrero de 2008 hubo un aumento neto de 518 empresas de telecomunicaciones en el mercado, y el número total es de 14.441 empresas.   Sin embargo, la Empresa Nacional Nipona de 
Telégrafos y Teléfonos (NTT) sigue dominando el me rcado de las telecomunicaciones en términos de 
ventas y de tráfico, con excepción de l tráfico de servicios telefónicos de larga distancia.  Las tarifas 
locales de telefonía fija y las tarifas de telef onía móvil en el Japón han descendido hasta niveles 
comparables a los existentes en otros países de sarrollados, pero las tarifas de comunicaciones 
internacionales siguen siendo relativamente altas.  El  mayor crecimiento de la productividad total de 
los factores en el sector de "la información y las comunicaciones" puede atribuirse a la reciente liberalización del sector en el país, que intensific ó la competencia.  No obstante, la Comisión de 
Comercio Leal del Japón (JFTC) sostiene que el me rcado japonés de servicios de telefonía fija y 
telefonía móvil se caracteriza por "situaciones de m onopolio" (oligopolio), tal como se definen en el 
párrafo 7 del artículo 2 de la Ley Antimonopolio.   Según este párrafo la Empresa Nacional Nipona de Te légrafos y Teléfonos (NTT) domina el mercado 
de las telecomunicaciones en Japón. ¿Debe cumplir esta empresa obligaciones o condiciones 
especiales por actuar como operador dominante?  WT/TPR/M/211/Add.1 
 Page 47 
 
 
  THE EUROPEAN COMMUNITIES  
 
Report of the Government of Japan 
 Government of Japan Report, page 10, para. 30    
 1. Could Japan explain why its contributions to  the mentioned multilateral TRTA schemes have 
been fairly modest (especially when compared to  its overall ODA expenditure )?  Is Japan planning a 
meaningful contribution to the Integrated Framework for LDCs?  Government of Japan Report, page 11, para. 38     
2. We welcome the gradual expa nsion of Japan's Duty Free Quota Free treatment, now reaching 
98%, defined at the tariff line level.  
3. Could Japan explain how and when it intends to reach the 100% coverage set out in Annex F 
of the Hong Kong Declaration, and if such decision would be conditional upon the successful 
conclusion of the Doha Round ?  (See also paragraph 75 where Japan indicates that it would "steadily implement its Development Initiative for Trade re gardless of the progress of DDA negotiations".) 
 
Government of Japan Report, page 17, para. 67   
 
4. Could Japan provide more information on the "One Village, One Product" movement, in 
terms of achieved results, evaluations of the scheme by development experts and how this links with 
the Aid for Trade initiative?  Government of Japan Report, page 17, para. 68     
5. Could Japan provide more information on $2.5 billion support it intends to provide as 
financial assistance to stimulate Japanese private sector investment s in Africa under the new "African 
Investment Facility"?  Government of Japan Report, page 18, para. 73    
 
6. As regards Japan's "Development Initiative fo r Trade", we note with interest the initiative's 
focus on three stages (produce/sell/buy).  Could Japan  provide links to a more detailed description, 
website or brochures on this Initiativ e, and elaborate on how this links with the recommendations of 
the WTO Aid for Trade Task Force? 
 
WTO Secretariat's Report 
 I. ECONOMIC ENVIRONMENT  
(1)
  M AIN ECONOMIC DEVELOPMENTS  
 WTO Secretariat's Report, page 4, para. 6  
The WTO Secretariat's Report notes that "the pace of  [structural] reforms has apparently slowed 
down". 
 6. Are structural reforms still a priority in Japan at a time of increased public spending to tackle 
the economic crisis?  WT/TPR/M/211/Add.1 
Page 48  
 
  (2) M
ACROECONOMIC POLICIES  
 (ii) Fiscal policy  WTO Secretariat's Report, page 6, para. 11 
 
The WTO Secretariat's Report mentions the inten tion of the Government of Japan to introduce 
additional budget measures in the face of a global economic recession.   7. Could Japan describe whether the measures foreseen target only Japanese companies or do 
they apply to all companie s active on Japanese Territory?  
 8. Do some of these measures prioriti se companies with a trade focus?  
 The EC calls on Japan to design its economic stim ulus package in such a way that it maintains 
openness for trade and investment, in line with the pledge made by G-20 at the Summit in 
Washington in November 2008.  
(3) S
TRUCTURAL POLICIES  
 
(i) Tax reform 
 
WTO Secretariat's Report, page 7, para. 17    
The WTO Secretariat's Report presents the tax rules concerning triangular measures but the details of 
the tax rules surrounding triangular measures rema in unclear.  The EC sees them as a major 
inefficiency in Japan's strategy to promote FDI.  
 The EC urges Japan to consider how the scheme of triangular mergers could be made more attractive 
(eg. regarding tax deferral) and to expand the range of vehicles available for mergers. 
 
(ii) Financial system and corporate reform 
 
WTO Secretariat's Report, page 7, para. 19    
The WTO report describes the FSA plan for strent hening the financial and capital markets. Great 
progress has been made by Japan, especially with th e removal of firewalls between banks, insurance 
companies and securities; and with efforts towards better regulation. 
 9. The aim of the FSA plan was to attract fo reign institutions to Japan as a way to increase 
innovation and thus competitiveness of the Japanese financial sector.  Could Japan comment on the 
impact of the financial crisis on the achievment of these goals of the FSA plan?   
10. Could Japan provide furhter details on its  efforts to facilitate universal banking? 
 
WTO Secretariat's Report, page 8, para. 22  
 
11. Can Japan confirm that Japan Post Insurance entity is about to request authorisation to 
commercialise cancer insurance products? 
 12. Given recent Japanese press reporting on the government decision to temporarily freeze the 
planned sale of 70 Kampo's resort facilities, could Jap an provide an update on the state of play of the 
implementation of its plan to privatize the state-run postal services?   WT/TPR/M/211/Add.1 
 Page 49 
 
 
  The EC would like to reiterate concerns raised with the Postal Privatisation Committee (PPC) in 
December 2008 that any market expansion of th e Japan Post Group entities should take place only 
after a level playing field has been secured w ith private, including foreign, companies. 
 
WTO Secretariat's Report, page 9, para. 23  
  The WTO Report mentions improvements to the co rporate governance system.  However, the EC 
regrets that the Government of Japan has not r esponded positively to our request for amendment of 
Article 821 of the Corporate Law, which the EC believes would contribute to creating an open and predictable environment for trade and investment. Article 821 creates uncerta inity about the legality 
of foreign companies' business operations in Japan. It provides that foreign companies with a main 
office in Japan or whose primary purpose is to conduct business in Japan cannot engage in 
transactions on a continuing basis in Japan or, in a literal reading of Article 821, they face the risk of 
prosecution.  
13. Could Japan outline any movements towards an amendment of Article 821? 
 
II. TRADE POLICY REGIME:  FRAMEWORK AND OBJECTIVES 
 (1) I
NTRODUCTION  
 
WTO Secretariat's Report, page 15, para. 2   
The Secretariat's Report outlines th at: "Japan's trade policy priorities include strengthening the 
multilateral trading system, as embodied in the WTO.  Nonetheless, Japan is of the view that its regional and bilateral free-trade ag reements complement trade liberalization at the multilateral level. 
During the period under review, six additional agreem ents entered into force (with Chile, Thailand, 
Indonesia, Brunei, ASEAN, and the Philippin es); several others are being negotiated". 
 14. Could Japan elaborate further on how it inte nds to encourage sustainable development and 
core labour standards in the context of negotiations  of free-trade agreements with third countries? 
  (4) T
RADE AGREEMENTS AND ARRANGEMENTS  
 (ii) Regional agreements 
 
WTO Secretariat's Report, page 21, para. 19 
 
15. Could Japan explain what rules of origin are applied for good and services traded with countries that are members/signatories of both ASEAN and AJCEP in the context of bilateral FTAs that Japan has signed with members of ASEAN?  
(iii) Other agreements and arrangements 
 (l) Bilateral relationships with Viet Nam, India, Australia, and Switzerland  
 
WTO Secretariat's Report, page 25, para. 38    
The WTO Secretariat's Report mentions the ongoing EPA  negotiations with Switzerland.  The EPA is 
foreseen to be signed on February 19 and until  that date, the text is confidential. 
 16. Could Japan, nevertheless, give an outline of th e provisions of the agreement with respect to 
its main elements (Trade in Goods, Rules of Origin, Customs Procedures and Trade Facilitation, WT/TPR/M/211/Add.1 
Page 50  
 
  Trade in Services and Movement of Natural Person s, Investment, Intellectual Property, Government 
Procurement, Competition, Electronic Commerce and the Promotion of a closer Economic Relationship)?  
(iv) Preferential treatment 
 
WTO Secretariat's Report, page 28, para. 51  
WTO Secretariat's Report explains in paragraph 51 that Japan's GSP scheme works with various 
preferential rates and ceilings for cer tain sensitive industrial products.  
 
17. Could Japan indicate what percentage of 'elig ible' imports of sensitive products actually fall 
under the ceiling and receive GSP treatment?  
WTO Secretariat's Report, page 28, para. 52   
 Japan's imports from Least Devel oped Countries under Duty Free Quota Free treatment amount to ¥ 
62.9 billion (or approximately € 533 milli on at the current exchange rate).  
 18. Could Japan provide the figure for the tota l value of Least Developed Country imports? 
 
WTO Secretariat's Report, page 29, Table II.2    
 
Table II.2 lists the largest beneficiaries of Japan 's GSP scheme.  It shows that 68.5% of total 
preferential imports under the GSP scheme come from China.  Indonesia, which comes second on the 
list, represents only 6.2% and sev enth-placed India only 1.8%. 
 
19. Noting the high concentration of Chinese im ports under Japan's GSP scheme, could Japan 
inform whether it is considering any steps to  ensure a wider uptake of GSP preferences? 
 
(5) F
OREIGN INVESTMENT REGIME  
 
WTO Secretariat's Report, page 29, para.54    
As WTO Secretariat's Report notes, there is an imbalance between the high level of outward FDI and 
the low level of inward FDI in Japan, which also ap plies to the bilateral FDI flows between Japan and 
the EC.  Foreign businesses continue to perceive Jap an as a difficult market to penetrate.  The EC 
encourages Japan to address this situ ation aggressively and without delay. 
 
(i) Regulatory regime 
 WTO Secretariat's Report, page 29, para. 56     
Paragraph 56 of the WTO Secretariat's Report outlin es the main provisions of the Foreign Exchange 
and Trade Control Law.  20. Could Japan elaborate upon the rationale for choosing as a notification ceiling for FDI 
requiring prior authorisation the figure 10% of the stocks of a company active in a sensitive sector? 
 
21. Prior notification for inward FDI is required in a number of sectors (Table AII.3).  In 2008, 
for the first time, Japan recommended against a FDI project (in the electric utility sector).  Could Japan clarify whether it is considering reducing th e list of sectors requiring prior notification or 
publishing clear guidelines on the implementation of such restrictions?  WT/TPR/M/211/Add.1 
 Page 51 
 
 
  (ii) Investment Promotion Measures 
 
WTO Secretariat's Report, page 31, para. 61   
 
A revision of the 2006 Program for the Acceleration of Foreign Direct Investment was announced by 
the Government of Japan to be finalised on 20 December 2008.  
 22. Could Japan present the main targets to be reached, including in terms of legislative and 
regulatory changes envisaged/adopted as well as the timeline for their implementation?  
 
23. To what extent was foreign expe rience studied and taken into account?  
 24. Could Japan explain what measures it may have considered to contribute to a more balanced 
bilateral investment flow between the EC and Japan?  
25. To what extent will the present economic c ontext have an impact on the revision of the 
Program for the Acceleration of Foreign Direct Investment as finalized in mid-December 2008?  
 WTO Secretariat's Report refers to the Five R ecommendations Toward the Drastic Expansion of 
Foreign Direct Investment in Japan submitted by the newly established Expert Committee on FDI 
Promotion to the Council on Economic and Fiscal Policy on 20 May 2008. 
 
26. Could Japan explain how it intends to fo llow-up on these recommendations by the Expert 
Committee on FDI Promotion?  
III. TRADE POLICIES AND PRACTICES BY MEASURE 
 
(1) M
EASURES DIRECTLY AFFECTING IMPORTS  
 (ii) Tariffs  
 
(a) Bound tariffs 
 
WTO Secretariat's Report, page 36 and 37, para. 19 and 22  
 
Paragraph 19 and 22 of the WTO Secr etariat's Report refers to non- ad valorem  rates of duty which 
apply mainly to (inter alia) textiles and notes (in chart III.3) that the "protection for footwear and 
headgear (…) is also relatively high". 
 27. Could Japan explain the objective of tho se duties, and whether Japan envisages their 
removal?  28. Could Japan explain whether it currently has any specific trade regime for textiles? 
 
WTO Secretariat's Report, page 38, para. 23  
 
The WTO Secretariat's Report states that "tariff escalation from semi-proces sed to final goods is 
present in some sectors, notably textiles (…)". 
 
29. Could Japan please explain the reasons behind this tariff escalation?   WT/TPR/M/211/Add.1 
Page 52  
 
  WTO Secretariat's Report, page 38, para. 24   
 
The WTO Secretariat's Report explains that there is an escalation from primary to semi-processed and 
final products only for rubber and its products.  
30. Could Japan explain the reasons for this tariff escalation? 
 (c) Preferential rates 
 
WTO Secretariat's Report, page 40, para. 29   
 
The WTO Secretariat's Report notes that China rema ins the largest beneficiary of preferential access 
to the Japanese markets.  31. Could Japan specify which are the main industries concerned? 
 
(v) Government procurement 
 
32. Does Japan intend to have the General Accoun ting Law translated into English as has been 
previously requested by the EC?  WTO Secretariat's Report, page 43, para. 39  
33. Could Japan clarify whether procurement by local public corporations of the 47 Prefectures 
and the 12 designed cities lis ted under Annex 2 in the GPA, in particular in the fields of airports, 
hospitals and urban transport, are covered by Japans current commitments under the GPA? 
 
WTO Secretariat's Report, page 44, para. 41   
 
34. Could Japan outline any plans to establish a single point of access for all public procurement 
business opportunities, including local government, as is done in the EC? 
 
WTO Secretariat's Report, page 44, para. 42  
35. Does Japan have any data as to the average or  median contract value awarded by entities in 
Annex 1, 2 and 3 (broken down by services, supplies and works) for all public procurement (not only 
those covered by the GPA)? 
 
WTO Secretariat's Report, page 44, para. 43   
 
The WTO Secretariat's Report explains the shares of foreign suppliers in contracts resulting from 
open and single tenders (which, respectively, were  1.6% and 4.3% in 2006). Thus, an important area 
of government procurement, especially at the lo cal level, appears beyond the reach of foreign 
suppliers. 
 36. Could Japan outline any plans to enhance the pa rticipation of foreign suppliers in Government 
Procurement procedures, especially at the local level?   
37. Japan claims that the total value of procurement covered under the GPA amounts to 
¥1.28 trillion, which represents some 0.5% of Japan ese GDP.  Does this value take into account the 
public procurement of local authorities conducted on be half of Central Government Ministries?  How 
much procurement does Japan estimate is (a) not to be covered by the GPA, (b) below the GPA  WT/TPR/M/211/Add.1 
 Page 53 
 
 
  thresholds and c) under 100.000 SDR? What is the proportion of procurement falling above the GPA 
thresholds (e.g.15,000,000 SDR for works,  130,000 SDRs for services and supplies)? 
 38. When measuring the share of public procur ement awarded to foreign suppliers, does Japan 
include contracts awarded to Japanese subsidiaries of  foreign companies or only foreign companies 
(i.e. companies established in another country and bidding from abroad)?  If available, could Japan 
report what is the "foreign share" in comparison to all public procurement rather than just in comparison to procurement covered by the GPA?  39. Could Japan explain the decrease of the share of contracts awarded to foreign suppliers? Also, 
could Japan provide figures on the share of work s and services procurement awarded to foreign 
suppliers?  Regarding railway procurement in Japan, the EC ha s been calling for an objective and predictable use 
of the operational safety clause that applies to ur ban and railway operators as a way to improve access 
to this market segment. 
 40. Could Japan provide a detailed explanation of the full scope of the operational safety clause in 
terms of the goods, services and construction works covered, as previously requested by the EC? 
 41. Does the estimate given in table III.3 for pr ocurement of railway equipment exclude the 
contracts which are not subject to foreign comp etition because of the operational safety clause?  
 
WTO Secretariat's Report, page 46, para. 45 
 
According to paragraph 45 of the WTO Secretaria t's Report, the Office of Government Procurement 
Review is not responsible for the review of contr acts awarded by local authorities. It would seem that 
the reviews are carried out by  the authorities themselves. 
 42. How does Japan secure that review procedur es of contracts awarded by local authorities 
comply with GPA requirements?  
43. As the Cabinet Office, to whom is the Government Procurement Review Board (GPRB) 
affiliated? Is it a contracting authority itself?  44. How does Japan ensure the independen ce of the decisions taken by the GPRB? 
 
45. What sanctions are foreseen against public entities that do not comply with the decisions of 
the GPRB? 
 
(vii) Standards, and sanitary  and phytosanitary measures 
 
(a) Standards, testing, and conformity assessment  WTO Secretariat's Report, page 46, para. 47  
 
The WTO Secretariat's Report notes Japans continue d efforts towards harmonization of international 
standards.  
 
46. Is Japan seeking to bring full harmonisation of  standards in the medical devices sector with 
additional national requirements, both in terms of  Quality Management Sy stem and Good Clinical 
Practices?  WT/TPR/M/211/Add.1 
Page 54  
 
  47. As an example, on 29 May 2006 the Minist ry of Health, Labour and Welfare (MHLW) 
introduced the positive list system for agricultural chemicals remaining in foods, where maximum 
residual limits are established for 799 substances, including pesticides and veterinary drugs, at levels far lower than those allowed in other countries.  Is Japan contemplating a process of convergence in 
these limits allowed in food, towards the levels generally accepted by the international standard-
setting bodies? 
 
WTO Secretariat's Report, page 46, para. 50 
 
The WTO Secretariat's Report indicates that "currently, 25 Japanese organizations are accredited as 
JIS mark certification bodies". 
 48. Could Japan please clarify whether any of those organizations are foreign?  49. Could Japan elaborate on its plans to adapt its standards/ regulations on pharmaceuticals, 
electrical appliances, road vehicles, and chemical substances to corresponding international standards/ 
regulations?  
WTO Secretariat's Report, page 48, para. 53  
 
Paragraph 53 of the WTO Secretariat's Report d escribes Japans efforts to adapt its transport 
regulations to international standards. 
 50. Could Japan explain its plans for approxima tion of vehicle safety regulations to UNECE 1958 
standards, of which Japan is signatory?  WTO Secretariat's Report, page 48, para.54 
 
The WTO Secretariat's Report notes that 12 bodies have been registered since the Third Party Certification System for medical devices was introduced in April 2005.   51. Could Japan clarify whether any of those organizations are foreign? 
 
(b) Sanitary and phytosanitary measures  
 
WTO Secretariat's Report, page 49, para. 56     
The WTO Secretariat's Report describes developments  in SPS regulations in Japan.  It mentions 
mentioned that "new food additives have been a pproved and a revision of existing standards and 
specifications has been noted ".   In the area of food regulation, Japan still lags be hind other countries in the process of approving food 
additives.  Although in 2002, Japan committed itself to  study a list presented by the EU of 46 food 
additives whose use was forbidden in Japan (althoug h they have been assessed safe by international 
bodies) the process of approval has been incredibly sl ow. So far, after seven years, only 25 additives 
out of the 46 have been approved.   52. Can Japan explain whether internationally accepted limits for food additives are considered 
when evaluating the safety of these substances in Japan? 
 53. Does Japan plan to accelerate the approval pr ocedures in place for food additives that are 
widely used around the world but that are s till subject to lengthy and cumbersome approval 
procedures in Japan?  WT/TPR/M/211/Add.1 
 Page 55 
 
 
  WTO Secretariat's Report, page 50, para.59 
 
The Secretariat's Report indicates that Japan bans imports  on beef in order to prevent spread of BSE.  
The EC countries from which beef is prohibited are listed under the footnote number 50.  The World Organisation for Animal Health (OIE) Code prov ides for conditions under which beef and beef 
products can be safely traded from all countries.  Mo st EC countries have now been classified by the 
OIE as countries with "negligible risk" or "controlled risk".  However, Japan allows beef imports from 
a country with the OIE status of both "negligible" and "controlled risk".   54. When would Japan allow the imports of beef and other products from EC Member States and 
thus apply the same treatment as for other WTO Members? 
 The Report, in the same paragraph, also indicates that Japan currently imposes import prohibitions on 
poultry from various countries to prevent the spread of avian flu.  
55. Could Japan please confirm that it effectiv ely and correctly applies regionalisation for 
importing countries so that the trade can still ta ke place under the rules set down by the OIE 
concerning avian influenza?  (c) Labelling and packaging requirements 
 
WTO Secretariat's Report, page 50, para. 61   
 
The WTO Secretariat's Report outlines changes to th e labelling and packaging requirements that have 
been recently introduced.  
56. Introducing these new origin la belling requirements for ingredients in processed foods would 
be impracticable for business.  Would Japan agree that if some products use ingredients from many 
different countries and/or change ingredients th roughout the season, origin labelling may not be 
feasible?  
 
(4) M
EASURES AFFECTING PRODUCTION AND TRADE  
 
(i) Taxation and tax-related assistance  WTO Secretariat's Report, page 53- 54, para. 76 
 57. In paragraph 76, the WTO Secretariat's Report refers to the FY 2005 twice. Would the correct 
reference not be the FY 2006?  WTO Secretariat's Report, page 55, para. 80 
 
The last part of paragraph 80 on  taxation and tax-related assistance states that "tax treatment of 
interest received by non-residents was changed; a nd the portion of the interest income on bonds issued 
by a foreign company, which attributes to a business conducted in Japan, is now treated as a domestic 
source income and taxed as such." 
 
We understand that the last sentence should rather r ead "the portion of the interest income on bonds 
issued by a foreign company, which can be attr ibuted to a business conducted by that company in 
Japan, is now treated as domestic source income and taxed as such."  
 58. Can Japan confirm that this the accurate reading? 
 WT/TPR/M/211/Add.1 
Page 56  
 
  (iii) State-owned enterprises, corporatization, and privatization 
 WTO Secretariat's Report, page 56, para. 82   
The report mentions the planned privatisation of Narita Airport and the EC welcomes the positive 
indications regarding non-discrimination be tween foreign and domestic investors. 
 59. Could Japan confirm that this principle w ill be reflected in the revision of the Airport 
Development Law as well as the principles of transparency and proportionality? 
 (vi) Regulatory reform  
The reports make no reference to the important regu latory reforms underway in Japan in the field of 
consumer protection/safety.  
 
60. Given that these reforms may have an impact on WTO, in particular with regard to the WTO 
Agreement on Technical Barriers to Trade, could Japan  describe the main elements of these reforms?  
 There is no mention in either reports of Japan's environmental policies.  
 61. Has there been any regulatory reform in the area of environmental policy of Japan, in 
particular climate change related policy, that has an impact on WTO? 
 
(vii) Competition policy 
 
(a) Recent developments  WTO Secretariat's Report, page 63, para. 107-110  
The WTO Secretariat's Report highlights measures u ndertaken by the Japanese government to ensure 
competitive markets. However, many sectors continue  to be dominated by a small few companies. 
 
62. Does Japan foresee in the near future any fu rther specific initiatives to strengthen competition 
policy in order to bring more competition to the market place and facilitate access for new entrants, 
including foreign companies?  The WTO Secretariat's report mentioned amendments to the Anti-Monpoly Act (AMA) in 2006 and 
2008, described in paragraph 108 and 110 respec tively.  The 2008 amendment to the AMA was 
submitted to the Diet but was not approved and has been since withdrawn.  Formally, the Government 
of Japan should submit a new amendment by the end of March.   63. Will the new amendment to the Anti-Monopoly Ac t be submitted to the current Diet Session?  
Could Japan give details on the main differences  between the amendment su bmitted in 2008 and the 
amendment to be submitted in 2009? 
 
(f) Enforcement 
 
WTO Secretariat's Report, page 65, para. 113 
 
64. With regard to the thresholds used for merg er screening, could Japan indicate whether it will 
increase the target's sales threshold to ¥ 5 billion (so that for transactions falling below these sales 
minimums, parties will not be required to seek the FTC's approval in advance), with an eye toward 
further concentrating on large deals that could adversely affect competitive conditions?  WT/TPR/M/211/Add.1 
 Page 57 
 
 
  WTO Secretariat's Report, page 67, para. 119 
 
65. Could Japan indicate whether the handling of appeals of decisions by the Japan Fair Trade 
Commission will be transferred to the court system?  
66. If on cartels and bid-riggings, the possibility were offered in the new AMA amendment to be 
submitted to the Diet by the end of March 2009 for companies to attack Japan Fair Trade 
Commission's decisions in Court, is the Government of Japan confident that this would not slow down 
the implementation of competition policy and thus weak en it?  Are Courts well equipped to deal with 
competition cases (in terms of level of expertise of  the judges, speed of the proceedings etc.)? 
 
(viii) Corporate governance 
 WTO Secretariat's Report, page 69, para. 122 
 A new Corporate Governance Study Group, set up by METI early December 2008, will submit a 
report by June 2009 on issues such as the independen ce of external directors and auditors and the 
rules on introducing numbers of outside directors.   67. Could Japan clarify the working mandate given to this Corporate Governance Study Group?  
68. Can Japan confirm that the final objective of this study group is the revision of the Corporate 
Law or a listing regulation to be impl emented by the Tokyo Stock Exchange? 
 69. Could Japan assure us that importance is give n in this context to a better protection of the 
minority shareholders and present any reforms envisaged in this field? 
 
70. Could Japan provide an update on the schedule and timeline for the adoption of the International Financial Reporting Standards?   
IV. TRADE POLICIES BY SECTOR 
 
(2) A
GRICULTURE  
 (ii) Policy developments  
 
WTO Secretariat's Report, page 75, para. 16  
 71. Could Japan please give details on how it ensure s that the brand names of its premium brands 
that are often linked to regional characteristics (Kobe Beef, Yubari Melons etc.) are properly 
protected in third countries? 
 
(3) M
ANUFACTURING  
 
WTO Secretariat's Report, page 78, para.23 
 
The WTO Secretariat's Report details the footwear tariff scheme.  The current leather footwear quota 
restriction is 12,019,000 pairs according to the Jap an Tariff Association, which is exactly the same 
figure as for 1996.  Imports exceeding the quota level are being charged either at an ad valorem  duty 
of 30% or a specific amount of 4,300 ¥/pair, whichever is higher.  72. Does Japan contemplate removing or otherwise increasing the tariff quota on leather and leather footwear? WT/TPR/M/211/Add.1 
Page 58  
 
  WTO Secretariat's Report, page 79, para.25 
 
In its description of Japanese Government support to  the aeronautical industry, the report mentions 
grants by Japan to the International Aircraft Deve lopment Fund. It also notes that Japan intends assist 
the development of manufacturing, including aircraft industry. 
 
73. Could Japan explain the content of these programmes?  
(4) E
NERGY AND UTILITIES  
 
WTO Secretariat's Report, page 79, para. 30   
The WTO Secretariat's Report notes that foreign co mpanies wishing to invest in electric and gas 
utilities must register their intent, under the provisi ons of the Foreign Exchange and Foreign Trade 
Law.  In 2008, the authorities recommended against one request or permission on grounds of 
"national security" for the first time since 1945. 
 74. Could Japan explain the rationale for this refusal?  
(5) S
ERVICES  
 
(ii) Financial services  
 
(b) Insurance  
WTO Secretariat's Report, page 85, para. 40 
 The WTO Secretariat's Report notes that the Japa nese authorities maintain that there are no 
state-owned insurance companies in Japan.  75. Could Japan explain why it considers the Japan  Post Insurance Co. to be privately owned, 
although it is fully owned by a holding company under state control? 
 
WTO Secretariat's Report, page 85, para. 41 and 44 
 
The WTO Report notes the changes that have take n place in the insurance field since 2007, including 
several merger deals and the start of operations of  Japan Post Insurance Co  that resulted from the 
corporatization of Japan Post.  The EC worries that some of these developments have been 
undermining the level playing field and leading to an increasingly oligopolistic nature of the market. 
 
76. Could Japan explain how it will ensure that companies, including foreign companies, can 
compete on equal terms in the insurance market? 
 
WTO Secretariat's Report, page 85, para. 42 and 43 
 
The Mutual Insurance (Kyosai) are not regulated by Financial Service Agency (FSA).  These used to 
be small scale, mutual businesses but, according to th e Japan Cooperative Insura nce Association, they 
actually sell nearly 25% of all life insurance polic ies and account for 30% of all insurance premiums 
for non-life insurance policies in Japan. 
 
77. Does Japan plan to restore a level playing fi eld between insurances regulated by the FSA and 
the Kyosai?   WT/TPR/M/211/Add.1 
 Page 59 
 
 
  WTO Secretariat's Report, page 85, para.42 
 
78. Could Japan explain why conducting insu rance business as well as commercial presence 
per se  of insurance companies has to be aut horized by the Prime Minister himself? 
 
(c) Securities  WTO Secretariat's Report, page 86, para. 46 
 
As noted by the WTO Secretariat's Report, The Financial Instruments and Exchange Act (FIEA) 
provides that foreign securities firms are allowe d to conduct certain securities-related businesses 
through agencies or intermediary of securities firm s within Japan only on condition that the foreign 
firms make on solicitation.  
79. Could Japan explain the rationale for this restriction? 
 WTO Secretariat's Report, page 87, para. 49  
The WTO Secretariat's Report in para.49 describes  Japan's disclosure requirements in securities 
industry. 
 
80. How would Japan justify the cumbersome proc edures for companies to submit to the Prime 
Minister extra reports concerning their sales or acquisitions of securities abroad? 
 
(iii) Telecommunications 
 WTO Secretariat's Report, page 88, para.52 
 81. Are there any restrictions on the basis of dom estic legislation if foreign investors intend to 
participate in the Japanese telecommunication sector?  
WTO Secretariat's Report describes developments in Japan's telecommunications sector including 
positive trends that could be attributed to recent liberalization.  However, according to JFTC, the 
Japanese market for fixed and mobile telecom services is still characterized by "monopolistic 
situations" 
 
82. In view of such persistent monopolistic te ndencies, would Japan explain how it intends to 
reform its telecommunication sector further?  In the same paragraph, the WTO Secretariat's Re port notes that "Between August 2006 and February 
2008, there was a net increase of 518 telecommunications  carriers in the market, to 14,441 carriers".  
 83. Can Japan indicate in which services markets there is a high number of carriers?  
 
The Report goes on to note that " in terms of sales and traffic, the partially state-owned Nippon 
Telegraph and Telephone (NTT) Cor poration continues to dominate the telecommunications market, 
except for traffic in long-distance telephone services."   
 
84. Can Japan indicate what measures it plans taki ng to address the issue of the dominant position 
of NTT in the local, but also in the long distance markets? 
 85. Is Japan planning to establish a genuine independent regulator for telecommunication to 
replace the Ministry of Internal Affairs and Communications? WT/TPR/M/211/Add.1 
Page 60  
 
  PERÚ
 
 
III. OBSERVACIONES RECAPITULATIVAS 
1. Ref.: Observaciones recapitulativas (párrafo 6)  
  Se afirma que "el único cambio importante introducido en los ministerios y organismos 
gubernamentales del Japón encargado de la planif icación y evaluación de las políticas comerciales 
desde su anterior Examen de Políticas Comerciales" fue la eliminación del Consejo de Inversiones del 
Japón y el establecimiento del Comité de Expertos en  promoción de la IED, el cual depende de la 
Oficina del Consejo de Ministros. En ese sentido, el Perú quisiera conocer cuáles son las principales 
consecuencias de este cambio. ¿Cuáles son las nuevas atribuciones del Comité y cuáles de sus 
antiguas competencias ya no posee? ¿Cuál fue el prin cipal motivo de este cambio y en qué medida ha 
ayudado a una mejor inserción del Japón en  el sistema multilateral de comercio? 
 
2. Ref.: Observaciones recapitulativas (párrafo 11) 
 
 Con relación a la adopción de medidas para hacer más atractivo l as inversiones de las 
empresas extranjeras, el Perú desearía saber en qué consisten estas medidas.   Asimismo, ya que el gobierno del Japón consider a que la inversión extranjera en servicios de 
electricidad no es recomendable por motivos de orden público, seguridad pública y seguridad 
nacional, el Perú desea saber qué otros sectores son considerados de igual mane ra y, por lo tanto, la 
IED se encuentre limitada o prohibida.   
3. Ref.: Observaciones recapitulativas (párrafo 12) 
  Si bien "parece que el Japón no ha introducido nuevas medidas comerciales para proteger su 
mercado desde el comienzo de la crisis financie ra mundial", el Perú desea saber si el gobierno 
Japonés contempla la posibilidad de adoptar e implementar ciertas medidas y en caso afirmativo, cuáles serían éstas medidas, teniendo en consider ación que los Estados Unidos y las Comunidades 
Europeas, dos de los principales socios comerciale s del Japón, contraeran su demanda extranjera, lo 
que generaría un deterioro de  su balanza comercial. 
 
4. Ref.: Observaciones recapitulativas (párrafo 16);  Políticas y prácticas comerciales, por 
medidas (párrafo 71) 
 
 Dado que el Japón se reserva el derecho de aplicar controles a las exportaciones por razones 
de abastecimiento suficiente de de terminado productos agrícolas, el Perú desearía saber qué entiende 
el Japón por "abastecimiento suficiente" y cuánto significó este "abastecimien to suficiente" en los 
últimos años en diferentes productos.  Asimismo, de sea saber qué tipo de controles han sido aplicados 
a las exportaciones en estos casos y si los mismos se rían aplicables también a los países con los cuales 
el Japón ha firmado Acuer dos de Libre Comercio. 
 5. Ref.: Observaciones recapitulativas (párrafo 27) 
 
 Con relación a la liberalización del mercado de l gas, el Perú desea saber qué medidas ha 
tomado el Japón para incentivar y fomentar la competencia en este sector.  6. Ref.: Observaciones recapitulativas (párrafo 31) 
 
 Con relación al rápido envejecimiento de la  población del Japón y la consiguiente reducción 
de la población activa, con su correlato en la problem ática de las pensiones, el Perú desea saber si el  WT/TPR/M/211/Add.1 
 Page 61 
 
 
  Japón ha contemplado algún progr ama de fomento de la migración legal o regularización de 
extranjeros ilegales en el Japón con miras a incor porarlos normal y plenamente al mundo laboral del 
Japón y así evitar el mayor incremento del pr omedio de edad de la población japonesa.  
 
IV. POLÍTICAS Y PRÁCTICAS COMERCIALES, POR MEDIDAS 
i) Contratación pública 
 
 ¿Existe un portal electrónico único para la publicación de toda la información sobre las licitaciones?   
 ¿Japón aplica preferencias o bonificaciones al proveedor nacional para el caso de las 
contrataciones que no se encuentran abarcadas por el ACP?    ¿Qué régimen de contratación pública (legislación, preferencias, entre otros) es aplicado por los gobiernos locales/municipios?  
 
 ¿Existen licitaciones reservadas exclusivamente a algún sector o grupo (por ejemplo, PYMES)?    ¿Se pueden presentar ofertas electrónicas?   
 Si se supone que el mercado está abierto,  ¿Por qué motivo no se ha registrado ningún 
aumento significativo en la adjudicación de contratos a empresas extranjeras?   
V. RÉGIMEN DE POLÍTICA COMERCIAL: MARCO Y OBJETIVOS 
4) A
CUERDOS COMERCIALES  
 
iii) Otros acuerdos 
 
¿Cuál es la política de Japón respecto a la negociaci ón de capítulos de entrada temporal de personas 
naturales con compromisos de corte migratorio  en sus acuerdos comerciales bilaterales. 
 VI. POLÍTICAS COMERCIALES, POR SECTORES  
2) A
GRICULTURA  
 
 Como lo señala el Documento Preliminar del Examen de Política Comercial (EPC), la 
reforma agraria en el 2007 se concentro en las tie rras de cultivo de los principales agricultores, con 
miras a fortalecer la estructura de la agricultura japonesa y el establecimiento de la "estrategia para 
evitar el calentamiento global".    Japón viene promoviendo las exportaciones de productos agrícolas utilizando un sistema de devolución de derechos para reembolsar los aran celes de importación recaudados sobre los insumos 
utilizados en la producción de bienes de expor tación, adicionalmente, existen sistemas de 
financiación, seguro y garantía de las exportaciones.    Al respecto, se solicita una mayor una expli cación respecto al programa de estabilización de 
la gestión agrícola destinado para los agricu ltores, adoptada en el 2008. ¿Este programa de 
estabilización, pretende mantener un nivel de producción estable que garantice la seguridad 
alimentaría, mantener un adecuado nivel de empl eo en este sector; también tener algún fondo de 
estabilización de precios? WT/TPR/M/211/Add.1 
Page 62  
 
  Protección Arancelaria 
 
 El EPC indica que los productos agrícolas son los que gozan de mayor protección arancelaria, 
con un arancel NMF promedio (17.1%), mientras que los aranceles para los productos manufacturados (SA 25 a 97) son por lo general bajos (3.6%).  Adicionalmente, los aranceles no 
ad valorem  (derechos específicos, mixtos, compuestos, diferenciales y móviles) son aplicados 
principalmente a las grasas y aceites, preparaciones alimenticias, animales vivos, productos de origen 
animal, legumbres, hortalizas, entre otros (calzado,  textil, prendas de vestir y minerales) estos 
productos representan el 6.7% del total de las líneas arancelarias.  
 Los aranceles no ad valorem aplicados por Japón significan niveles de protección mucho 
mayores a los niveles de protección aplicados por el Perú.  En su equivalente ad valorem pueden llegar a tener tasas de 578.6%.  En ese sentido, sería importante conocer cuál es el tratamiento que han 
tenido dichos aranceles no ad valorem en los Acuer dos Comerciales bilaterales suscritos por el Perú. 
 
 Asimismo, el Perú solicita conocer cuáles son las medidas de sostenimiento de precio y de 
sostenimiento de ingresos vigentes en el Japón y cuál es son las reformas previstas en el marco de las 
negociaciones de la Ronda de  Doha para el Desarrollo? 
 
Contingentes arancelarios 
 
 Japón aplica contingentes arancelarios que abarcan  el 1.8% de todas las líneas arancelarias 
(159 líneas arancelarios), principalmente a productos agropecuarios entre los qu e se encuentran arroz, 
leche y productos lácteos (leche en polvo desnatad a, suero, mantequilla, aceite de mantequilla, 
preparaciones de grasas comestibles), legumbres de vaina secas, trigo, cebada, cacahuates, tubérculos de konnyaku, almidones, y capullo de seda y seda cruda.  
 
 EL MINAG solita una mayor información sobre el manejo y el volumen de los contingentes 
asignados, se entiende que es en el marco de la OMC. ¿Como es el manejo en el marco de los acuerdo bilaterales, si los volúmenes asignados son parte de los contingentes de la OMC o son volúmenes 
exclusivos asignados en el acuerdo bilateral?.  Subsidios a la Exportación  
 Japón notificó a la OMC que en el periodo comprendido entre el 1º de abril de 2006 y el 31 de 
marzo de 2007 no se habían propor cionado subvenciones a la exportación.  Podría Japón indicar si se 
han otorgado subvenciones a la expor tación para el período 1 de abr il 2007 al 31 de marzo del 2008? 
 
P
ROPIEDAD INTELECTUAL  
 
1. ¿Cuál es la política del Japón para el registro de denominaciones de origen extranjeras? ¿Qué 
denominaciones de origen extranjeras reconoce el Japón? 
 2. ¿Qué medidas se encuentra tomando el Japón para evitar la patentabilidad de productos 
biopirateados? 
 
5) S
ERVICIOS  
 iii) Telecomunicaciones  
  En el párrafo 52, se indica que "el mayor crecimi ento de la productividad total de los factores 
en el sector de la información y las comunicacione s puede atribuirse a la reciente liberalización del 
sector en el país, que intensificó la competenci a".  Desearíamos saber cuáles son las medidas pro  WT/TPR/M/211/Add.1 
 Page 63 
 
 
  competitivas que se adoptaron en el sector.  Asimismo, desearíamos conocer si el Japón permite la 
reventa y la compartición de infraestructura en telefonía.    En el párrafo 54 se hace mención al suministro de servicios universales.  Desearíamos saber cómo es que se determinan las empr esas que han de suministrar serv icios universales.  Asimismo, si 
es que existe alguna diferencia entre empresas nacional es o extranjeras en lo que refiere al suministro 
de servicios universales.   En el párrafo 28 se menciona que "el Gobierno ex aminó el empleo de medidas tributarias para 
promover la inversión (…) y hacer más competitivo en el plano internacional el sector de la 
tecnología de la información del Japón".  Quis iéramos saber si alguna de estas medidas se ha 
administrado haciendo distinción entre empresas nacionales o extranjeras. 
 
iv) Servicios de Transporte  
 
b) Transporte Aéreo 
 
En el párrafo 70, se indica que el Japón ha firmad o acuerdos bilaterales de servicios aéreos con 56 
interlocutores comerciales y que dichos acuerdos se refieren a derechos de tráfico y códigos comunes.  Desearíamos conocer si alguno de dichos acuerdos  se refiere a acuerdos de cielos abiertos.  
Asimismo, deseamos conocer cuál es la política de Japón respecto de la firma de acuerdos de cielos 
abiertos. 
 
v) Servicios Profesionales 
 
 En el párrafo 75, se señala que además de obtener  las licencias pertinentes, para las siguientes 
profesiones es obligatorio pertenecer a una asoci ación profesional:  contador público certificado, 
escribano administrativo, abogado, notario, topógrafo,  contable fiscal titulado, consultor público en 
seguros sociales y laborales y abogado especializado en  patentes.  El Perú desearía conocer si ninguna 
otra profesión exige la membresía a una asociaci ón profesional.  Asimismo, desearíamos conocer 
cómo se regula a las profesiones como la medicina y la  arquitectura. Es decir, quién otorga la licencia 
y cuáles son los requisitos para obtenerla.  
 
a) Servicios Jurídicos   En el párrafo 77 se señala que la participación extranjera en los servicios jurídicos está reglamentada por la Ley de medid as especiales sobre el ejercicio de la profesión jurídica por abogados 
extranjeros y que en virtud de dicha norma un "abogado extranjero registrado" (abogado extranjero 
titulado de acuerdo con la legislación japonesa) pue de emplear a un bengoshi (un abogado titulado de 
acuerdo con la legislación japonesa) y ambos pueden est ablecer una empresa conjunta.  Al respecto, 
desearíamos conocer si existen requisitos de reside ncia o experiencia previa en Japón para que un 
extranjero pueda obtener el registro en el Japón.   
b) Servicios de contabilidad 
  En el párrafo 78 se indica que los contadores de ben aprobar un examen nacional para obtener 
el título de contador público certificado en el Jap ón, los contadores extranjeros no titulados en el 
Japón con arreglo a la Ley de Contadores Públicos Titulados pueden prestar los servicios de auditoría 
especificados en el artículo 2-2 de dicha Ley en determinadas condiciones.  Desearíamos saber si es 
posible que un contador extranjero no titulado en el Japón puede rendir el examen nacional y obtener 
una licencia para ejercer la profesión en Japón.   WT/TPR/M/211/Add.1 
Page 64  
 
  III. POLÍTICAS Y PRÁCTICAS COMERCIALES, POR MEDIDAS 
 
1. ¿Cuáles son los principales sectores en los que Japón ha alineado sus normas técnicas con 
estándares internacionales? (Párrafo 48) 
 2. ¿Cuáles son los países y economías que han obt enido autorizaciones para el uso de marcas JIS 
(Normas Industriales Japonesas) y JAS (Normas Agrícolas Japonesas)? (Párrafo 50)  
3. ¿Pueden las instituciones de los gobiernos locales en Japón elaborar normas, reglamentos 
técnicos y procedimientos de evaluación de la conformidad? En caso sea afirmativa la respuesta, ¿están sujetas a las obligaciones del Acuerdo OT C de la OMC, incluyendo la obligación de 
notificación?  4. ¿Cuál es el estado de las notificaciones a la OMC, realizadas por Japón, respecto de sus 
reglamentos técnicos? 
 5. ¿Cuáles son los procedimientos de transparen cia utilizados por Japón para la publicación de 
sus reglamentos técnicos? ¿Posee Japón una página  web consolidada para la publicación de estos 
reglamentos?  
 
6. ¿Cuál es el periodo que Japón otorga  a los miembros de la OMC para comentarios sobre sus proyectos de reglamentos técnicos o procedimientos  de evaluación de la c onformidad? ¿Cuál es el 
periodo promedio que Japón posee entre la publicaci ón de un reglamento técnico y su entrada en 
vigor? 
 
7. ¿Posee Japón un mecanismo para la publicación de  respuestas a los comentarios recibidos de 
los miembros de la OMC a los proyectos de reglam entos técnicos o procedimientos de evaluación de 
la conformidad?  8. ¿Qué porcentaje de estos reglamentos técn icos y procedimientos de evaluación de la 
conformidad son traducidos y publicados en inglés? 
 9. ¿Existe una única institución encargada del estab lecimiento y la administración de las normas 
industriales en Japón? En caso no lo existiera, ¿cu áles son las principales instituciones encargadas? 
 
10. ¿Cuál es el enfoque usado por Japón para la supervisión de que los resultados de evaluación 
de la conformidad estén de acuerdo a reglamentos t écnicos? ¿Esta supervisión se realiza en aduanas o 
mercado interno?  11. ¿Cuáles son las principales áreas y los pr incipales medios por los cuáles Japón ofrece 
cooperación en materia de obstáculos técnicos al comercio? 
 
 
HONG KONG, CHINA
 
 Financial Services 
 
(WT/TPR/S/211, P. 83, Para. 37)  1. It is noted from the Secretariat's report that foreign banks may enter the Japanese market by establishing branches or subsidiaries after obtaining th e relevant licence.  While this reflects Japan’s 
banking regime in terms of the commercial presen ce mode of supply (Mode 3), would Japan update  WT/TPR/M/211/Add.1 
 Page 65 
 
 
  us about its regime for the provision of banking services via the cross border mode of supply 
(Mode 1)?  Is cross border supply of banking services allowed? 
 
Telecommunication 
 (WT/TPR/S/211, P. 88, Para. 52) 
 2. We are pleased to note from the Secretariat' s report that local fixed-line call charges and 
charges for mobile phone services in Japan have fa llen to levels comparable with those in other 
developed countries.  Besides, there has been a higher TFP growth in the "information and 
communications" sector, and this may be attributed to the recent liberalisation of Japan's telecom 
sector, which intensified competition.  This illustrat es well the substantive benefits that liberalisation 
would bring to individual sectors and in turn the economy as a whole.  In the light of this, we would like to know if Japan has any plan to take out fu rther liberalisation measures in the telecommunication 
service sector for the purposes of lowering cost , improving competitiveness and enhancing market 
efficiency. 
 
Maritime Transport Services 
 
(WT/TPR/S/211, P. 90, Paras. 60 and 62)  
3. We note from the Secretariat's report that in order to mitigate the decrease in the number of 
Japanese-flag carriers, th e Japanese Government provides support for Japanese-flag ca rriers under the 
International Ship Regime through various me asures, including among others, tax breaks and 
preferential tax treatment.  We would like to know more about the support measures under the 
International Ship Regime, in particular, whet her these measures would (a) discriminate against 
foreign services suppliers;  and (b) have any implic ations to Japanese's maritime transport services 
commitments in the GATS.  (WT/TPR/S/211, P. 91, Para. 65)  4. We note that Japan maintains MFN exemptions  for three sub-sectors in maritime transport 
services (cabotage services;  international freight forwarding;  and interna tional shipping services).  
For the latter two sub-sectors, market access and national treatment will be granted on a reciprocal basis.  We would appreciate Japan's advice on any plan to remove these MFN exemptions. 
 
Accounting Services 
 (WT/TPR/S/211, P. 94, Para. 78) 
 5. We note from the Secretariat's report that  a foreign accountant not qualified as a CPA in 
Japan may provide auditing services specified in Ar ticle 2-2 of the CPA Act under certain conditions.  
We would be grateful if Japan could provide more detail about this arrangement , particularly the types 
of auditing services that may be provided by such  foreign accountants and the conditions under such 
foreign accountants would be allowed to provide the relevant auditing services. 
  
SINGAPORE
 
 
Question 1  
 Paragraph 11 on page viii of the Secretariat’s Repor t notes that "for the first time under the current 
Foreign Exchange and Foreign Trade Law, the G overnment has issued a recommendation against an WT/TPR/M/211/Add.1 
Page 66  
 
  FDI proposal (for an electric utility) on the grounds  of "public order, public safety, and national 
security"."  Does this recommendation against the FD I proposal represent a change in Japan's policy 
against inward investment?  Also, are there sectors or  areas in Japan that might have stricter foreign 
investment criteria at present?  
Question 2
 
 Paragraph 56 on page 49 of the Secr etariat's Report notes that there have been several revisions to 
Japan’s food specifications and standards since 2006.   Could Japan please provide information on its 
import requirements for processed meat-based products that have undergone heat treatment (e.g. dried 
chicken, pork and beef)?  In particular, we  would appreciate information on the following: 
 (a) The complete import procedures (control, in spection and approval procedures) for export of 
processed meat products to Japan;   
(b) The relevant sanitary and phytosanitary regul ations and the relevant Domestic Law or Act 
involved; 
(c) The relevant agencies involved in the a pplication process and the responsibilities of these 
agencies;  and 
(d) The relevant documents to be submitted in the application process. 
  CANADA
 
 Report by the Government (WT/TPR/G/211)
 
 Part 2. Trade and Economic Policy Environment: (1) Japan's Economic Environment; 
paragraph 8, page 6: 
 
Japan states "On the policy front, in June 2008, th e Government reached a decision on “Economic and 
Fiscal Reform 2008 (Basic Policies)," which designates the course of economic and fiscal reforms for boosting the growth potential of the Japanese econom y and realizing prosperous and secure life for 
the people.  Reform efforts will be accelerated and deepened based on th e Basic Policies.  The 
Government will steadily implement the "Compreh ensive Immediate Policy Package -Easing Public 
Anxiety".  In addition, in view of the present financial and economic c onditions, the Government 
published the “Economic Policy Package:  Me asures to Support People's Daily Lives" on 
30 October."  
1. Could Japan elaborate on the key components of the Basic Policies, particularly as they relate 
to investment?    2. Does this policy reform include a policy on Bilateral Investment Treaties?   3. If so, could you please elaborate on what this policy entails?   
 
4. Does your stimulus package in response to th e recent financial crisis include any measures 
affecting foreign investment? 
 
Part 2. Trade and Economic Policy Environmen t: (3) Trends in Foreign Direct Investment: 
paragraph 12, page 7:  
Japan states that "In May 2006, th e Japan Investment Council (JIC), chaired by the Prime Minister, 
set a new goal to double the ratio of inward FDI stock to GDP by 2010, namely to raise it to a level of around 5%."  [The overall balance of foreign direct investment in Japan stood at about 17 trillion yen  WT/TPR/M/211/Add.1 
 Page 67 
 
 
  as of Sept. 30, or roughly equivalent to 3% of GDP .  Considering that the government has outlined the 
goal of raising this ratio to 5% by  the end of 2010, there is an evid ent need to reassess restrictions on 
such foreign investment activity.]  5. Has the government made any progress, beyond  the welcome implementation of triangular 
mergers and acquisitions policies, on reassessing restri ctions on overseas investments in Japan so as to 
raise FDI to 5% by the end of 2010?   6. How is the Japanese government working w ith private business entities such as Keidanren 
Business Federation corporate members to promote FDI into Japan by discouraging common business 
practices such as the adoption of poison pill measur es made easier by the relatively weak position of 
shareholders within the current corporate governan ce environment which is influenced significantly 
by Japanese laws and regulations? 
 
Part 5. Japan's Regional Activities: (4) Asia-Pacific Economic Cooperation (APEC): 
paragraph 49, page 13:  
7. How does Japan stand regarding the achievement  of Bogor objectives in time for the Japanese 
APEC chairmanship in 2010? 
 
Part 8. Japan's Domestic Policies; (2) Intell ectual property rights; paragraph 83, page 20: 
 
8. Could Japan please provide clarification on th e meaning of "Organization of measures for the 
promotion of the contents industry"?  9. It is very interesting that Japan has established intellectual property headquarters in 
universities.  Could more details  be provided on the activities that take place at these institutions? 
 
Part 8. Japan's Domestic Policies: (5) Competition Policy: paragraph 89, page 21: 
 
10. Has the bill been adopted during the 2008 fa ll session?  If not, what are the issues regarding 
the fact that the bill has still not been adopted? 
 
Report by the Secretariat (WT/TPR/S/211)
 
 Part I. Economic Environment: (2) Macroeconomi c Policies; (ii) Fiscal policy: paragraph 12, 
page 7: 
 The Secretariat Report states that "The Government  had decided to reduce the 31 "special accounts" 
in FY2006 to 17 by FY2010.  In April 2007, there were 28 "special accounts"… These were to be 
reduced to 21 during FY2008."  1. Could Japan indicate if its government is on track to achieve its objectives for the year 2008?  
 
Part I. Economic Environment: (3) Structural Policies; (iii) Pension reform: paragraph 24, 
page 9:  
The Secretariat Report states that "An adviso ry panel on pension reforms, which made 
recommendations to the Prime Minister regarding th e pension fund, called for:  replacement of the 
managers of the pension fund with i nvestment specialists;  diversifica tion of investments so as to get WT/TPR/M/211/Add.1 
Page 68  
 
  higher returns without increased risks
2;  and creation of smaller funds from the ¥150 trillion funds 
(each with a separate management  committee), which are expected to compete with each other in 
terms of transparency, accountability, and performance." 
 
2. What measures have been put in place to me et the recommendations of the advisory panel? 
 
Part II. Trade Policy Regime: Framework and Objectives: (1) Introduction: paragraph 2, 
page 15:  
3. What are the next steps in negotiation of fu ture bilateral Free Trade Agreements?  What 
criteria will Japan use in assessing which countries it will wish to negotiate future agreements with?  
 
Part II. Trade Policy Regime: Framework and Objectives: (1) Introduction: paragraph 6, 
page 15 and Part IV. Trade Policies by Sector : (1) Introduction: paragraph 4, page 70: 
 
The Secretariat report notes in several places that  the Government issued a recommendation against 
an FDI proposal in electric utilities on the grounds of "public order, public safety, and national security".   4. Could Japan please provide more information on what was meant by "public order, public 
safety, and national security" and how it applies to this particular investment?  Part II. Trade Policy Regime: Framework and Objectives: (3) Trade Policy Formulation and 
Evaluation; (ii) Trade policy evaluation: paragraph 11, page 19:  
The Secretariat Report states th at "In FY2007, the MOF conducte d evaluations of 62 [policy 
evaluation] projects, and as a result, allocations for some projects were reduced or eliminated in the 
FY2008 budget."  5. Of the 62 evaluations, how many assessments ha ve resulted in a reduction or elimination of 
allocations and for what amount?  Part II. Trade Policy Regime: Framework and Objectives: (4) Trade Agreements and Arrangements; (i) WTO: (a) Participatio n in the WTO: paragraph 16, page 21: 
 
6. How will Japan ensure that future Free Trad e Agreements are consistent with Article XXIV 
of the GATT?  
 
Part II. Trade Policy Regime: Framework and Objectives: (4) Trade Agreements and 
Arrangements; (iii) Other agreements and arra ngements: (m) Other b ilateral arrangements: 
paragraph 40, page 26: 
 
The Secretariat Report states that "Little progress seem s to have been made since Japan's previous 
Trade Policy Review." 
 7. What progress in trade policy does Japan foresee with Canada in the coming years? 
 
                                                     
 
2 Nearly 58% of the fund is invested in Japanese Government bonds and 18% in domestic stocks;  the 
return over the past five years has averaged 3.5% per annum.  WT/TPR/M/211/Add.1 
 Page 69 
 
 
  Part II. Trade Policy Regime: Framework and Objectives: (5) Foreign Investment Regime; 
(i) Regulatory regime: paragraph 58, page 30: 
 
The Secretariat Report states that "J apan also has BITs with Bangladesh;  China;  Egypt;  Hong Kong, 
China;  the Republic of Korea;  Russia;  Sri Lanka ;  Turkey;  Mongolia;  Pakistan;  and Viet Nam." 
 
8. What are Japan's criteria and priorities for future BIT negotiation partners?  
Part II. Trade Policy Regime: Framework and Objectives: (5) Foreign Investment Regime; 
(ii) Investment promotion measures: paragraph 61, page 31: 
 The Secretariat Report states that "The Committee's Five Recommendations Toward the Drastic 
Expansion of Foreign Direct Investment in Jap an, submitted to the Council on Economic and Fiscal 
Policy, on 20 May 2008, covered: …"   
9. What measures have been implemented or w ill be implemented as part of Budget 2009 or 
other pending legislative or regulat ory action to increase FDI in Japan? 
 
Part III. Trade Policies and Practices by Measure: (2) Measures Directly Affecting Imports; (i) Customs clearance procedures: paragraph 16, page 34:  
The Secretariat Report states that "The authorities are planning to introduce the Common Portal for 
the Next Generation Single Window in October 2008." 
 
10. Has the Common Portal been established?  
 
11. Has improvement of efficiency been observed? 
 
Part III. Trade Policies and Practices by Measure: (2) Measures Directly Affecting Imports; 
(ii) Tariffs; (b) MFN applied tariff: paragraph 21, page 37:  
The Secretariat Report states that "Since Japan's pr evious Review, there has been no change in the 
quota allocation method, which tends to be intricate." 
 12. Is Japan's intention to simplify the quota allocation method in the next few years? 
 
Part III. Trade Policies and Practices by Measu re: (2) Measures Directly Affecting Imports; 
(ii) Tariffs (c) Preferential rates: paragraph 28, page 40:  
The Secretariat report states that "nearly 150 tariff li nes, including certain meat, leather, and leather 
products, are subject to new tariff-rate quotas crea ted especially under the EPA between Japan and 
Mexico (JUMSEPA) (lines of agricultural products are not subject to tariff-rate quotas under applied 
MFN rates);  the in-quota rates are lower than the corresponding applied MFN rates." 
 
13. Could Japan provide further details on which tariff lines will be subject to the new tariff-rate 
quotas under JUMPSEPA;  the size of each quota as well as the in and out-of quota rates pertaining to each new tariff-rate quota?  Part III. Trade Policies and Practices by Measu re: (2) Measures Directly Affecting Imports; 
(v) Government Procurement: paragraph 39, page 43:  
 
14. Could Japan please provide information concer ning its green procurement policies, including 
with respect to pulp and paper?  WT/TPR/M/211/Add.1 
Page 70  
 
  Part III. Trade Policies and Practices by Measu re: (2) Measures Directly Affecting Imports; 
(v) Government Procurement: paragraph 41, page 44:  
 
The Secretariat's report states that "With a view to improving competitiveness and transparency in 
procurement procedures, the Government adopted  various measures in November 2007 including: 
adopting competitive bidding methods, (...)".  
 15. Could Japan please provide additional inform ation concerning the bidding methods adopted 
in November 2007?   
The Secretariat's report states that "The author ities state that local governments' procurement 
procedures are basically the same as those of th e central government, except for Japan's voluntary 
measures."   16. Could Japan please clarify the concept of voluntary measures?  Part III. Trade Policies and Practices by Measure: (2) Measures Directly Affecting Imports; (v) Government procurement: paragraph 44, page 45, Table III.3:  
17. Can Japan explain the declining share of foreign suppliers in the office machines and 
automatic data processing equipment category (from 5.6% in 2005 to 1.9% in 2006)? 
 Part III. Trade Policies and Practices by Measure: (2) Measures Directly Affecting Imports; (vii) Standards, and sanitary and phytosanita ry measures; (a) Standards, testing, and 
conformity assessment: paragraph 48, page 46:  
18. Of the 835 JIS items revised, the 289 withdr awn, and the 626 newly established, how many of 
them were or are comparable to international sta ndards, and how many of th em were or are aligned 
with international standards?  
Part III. Trade Policies and Practices by Measure: (2) Measures Directly Affecting Imports; 
(vii) Standards, and sanitary and phytosanitary measures: pages 46-49: 
 
Canada notes the descriptions provided for Japan’s practices vis-à-vis conformity assessment and technical regulations.  However, it is not clear as to determination of those that are subsequently 
notified under the WTO/TBT Agreement.   
19. Could Japan explain how the authorities (e.g . WTO Enquiry Point/Notification Authority) 
monitor the creation or modification of TBT techni cal regulations / conformity assessment procedures 
in its country in order to determine whether a WTO notification is required under the transparency 
obligations of the TBT Agreement?    20. When a determination is made, what is the mechanism (e.g. in terdepartmental/ inter-
ministerial collaboration) and timeline for the preparation of notifications? 
 
Part III. Trade Policies and Practices by Measure: (2) Measures Directly Affecting Imports; (vii) Standards, and sanitary and phytosa nitary measures: paragraph 60, page 50: 
 The Secretariat notes that imported food may be exempted from inspection upon importation into 
Japan if a cargo is inspected by an official insp ection organization in the exporting country and bears 
the results of the inspection.  The report also not es that these inspection bodies must be registered 
with the Government of Japan, th rough the government of the exporting country, in order to receive 
such exemption.    WT/TPR/M/211/Add.1 
 Page 71 
 
 
  21. Could Japan please provide the contact info rmation of the office responsible for this 
registration process?  
Part III. Trade Policies and Practices by Meas ure: (4) Measures Affecting Production and 
Trade; (iii) State-owned enterprises, corporatizat ion, and privatization: paragraph 84, page 56: 
 
The Secretariat Report states that "Under the plan, th e number of agencies is to be reduced to 85 by 
end-March 2011 by abolishing and merging agencies."  22. Over the last year, what progress has Japan made in this regard?  Part III. Trade Policies and Practices by Meas ure: (4) Measures Affecting Production and 
Trade; (iv) Intellectual property rights; (a) Recent developments: pa ragraph 85, page 57: 
 
23. Canada notes that the maximum term of protection for designs under the Design Act has been increased from 15 to 20 years, and would be interest ed in knowing what prompted the Japanese Patent 
Office to apply that change.  The Secretariat Report states that the protection of certain computer-related graphic images has also been increased.   
24. Could Japan please specify the measures that have been taken to increase the protection of 
these images? 
 
Part III. Trade Policies and Practices by Meas ure: (4) Measures Affecting Production and 
Trade; (iv) Intellectual property rights; (a) Recent developments: pa ragraph 93, page 59: 
 
The Secretariat Report states that "The Government ai ms to attain an average wait for the first action 
for patents to be within 30 months by  2008, and within 11 months by 2013." 
 25. What progresses has Japan made in this regard  in 2008 and what measures will be taken to 
reach its goal in 2013? 
 
Part III. Trade Policies and Practices by Meas ure: (4) Measures Affecting Production and 
Trade; (vi) Competition policy; (b) Exemptio ns from the AMA prohibition of cartels: 
paragraph 111, page 64:  
The Secretariat Report states that "On 25 March 2008, the Government decided that the MLIT would 
begin a review of the AMA exemption on agreements  by air carriers in the international aviation 
sector during 2008;  the MLIT set up an expert study group to review this exemption on 28 August 2008."  26. When will the expert study become available? 
 
Part IV. Trade Policies by Sector: (2) Agricu lture; (i) Overview, paragraph 7, page 71: 
 
27. What are the  total transfers (total support estimate) to fishery, its share of GDP and its share 
of employment?   Part IV. Trade Policies by Sector: (2) Agricu lture; (i) Overview, paragraph 9, page 72: 
 
The Secretariat Report states that "The Plan also contains a guideline to achieve a food self-sufficiency ratio (calorie based) of 45% by FY2015." WT/TPR/M/211/Add.1 
Page 72  
 
  28. What measures have been taken or are being considered to raise the self-sufficiency ratio 
from 39% to 45%? How will the Government of Japan  ensure that these measures do not raise barriers 
to trade?  
Part IV. Trade Policies by Sector: (2) Agricult ure; (ii) Policy developments: paragraph 10, 
page 72: 
 
The Secretariat Report states that "Some of th e average tariffs for the subsector may be 
underestimated, owing to the lack of estimates of AVEs for some specific duties (which tend to conceal relatively high tariffs)." 
 
29. Please provide a complete list of the tariff lines for which AVEs were not able to be calculated for inclusion in the aver ages presented in this paragraph. 
 Canada seeks clarification on the reform process concerning the "gate-price" tariff system which 
Japan maintains for pork.  A report
3 released on May 8, 2007 by the Special Committee on 
Globalization and Reform of the Council on Economic  and Fiscal Policy within the Government of 
Japan noted, inter alia , the need for streamlining of differentia l (combination) tariff systems such as 
pork "gate price" system.  In particular the report noted that wrongdoing has become apparent, in particular, under the differential (combination) tari ff system that imposes tariffs on pork and related 
products due to the complexity of the system.  The report concluded that the differential 
(combination) tariff system (including the pork "gat e price" system) should be abolished and changed 
to a simple and highly transparent system.  30. In light of the recommendations in the governmental report can Japan provide details on the reform process for the pork "gate price" syst em and outline how these reforms will create a 
streamlined, transparent, and predic table tariff regime pork imports?  
 
Part IV. Trade Polices by Sector: (2) Agricult ure; (ii) Policy developments: paragraph 11, 
page 72:  
The Secretariat has noted that the method of tariff quota administration used by Japan can be quite 
complex with restrictions on the use of produc ts and administrative requirements on companies 
seeking the right to import within quota.  On the other hand, a number of Japan's tariff quotas are persistently under filled, with fill rates of less than 50%.  
 31. Has Japan considered simplifying how it administers these tariff quotas? 
 
Part IV. Trade Policies by Sector: (2) Agricult ure; (ii) Policy developments: paragraph 12, 
page 74:  
The Secretariat Report states that besides the im port duty, Japan collects a levy or surcharge on 
imports of some commodities, and the collected levy goes to the special accounts related to 
agriculture in the Central Government. 
 32. Could Japan provide information on how these levy funds in special accounts are expended in 
agriculture? 
 
The Secretariat Report st ates that "Rice, wheat and barley remain the most heavily supported 
commodities; total subsidies provided for wheat, ba rley, and rice amounted to ¥182 billion in FY2002 
and ¥185 billion in FY2003 (the latest year for which data are available)." 
                                                     
 
3 The report can be found at:  http://www.keizai -shimon.go.jp/special/glo bal/global/02/item1.pdf  WT/TPR/M/211/Add.1 
 Page 73 
 
 
  33. Is it possible to obtain more recent data  on subsidies for wheat, barley and rice? 
 
Part IV. Trade Policies by Sector: (2) Agricult ure; (ii) Policy developments: paragraph 13, 
page 74:  
Under the "emergency measure on rice", the Japanese government purchased 0.34 million tonnes of 
domestically produced rice in 2007.  34. Could Japan please indicate the total amount of support provided through this measure?  
 
35. In addition, could Japan also indicate how this  support will be classified when it is notified to 
the World Trade Organization Committee on Agriculture?  
Part IV. Trade Policies by Sector: (2) Agricult ure; (ii) Policy developments: paragraph 13, 
page 74: 
 
36. Could Japan please indicate the total s upport provided under the "production adjustment 
programme in paddy fields" measure?   37. Could Japan also indicate how this support w ill be classified when it is notified to the World 
Trade Organization Committee on Agriculture? 
 
Part IV. Trade Policies by Sector: (2) Agricult ure; (ii) Policy developments: paragraph 16, 
page 75:  
The Secretariat Report states that “The Governme nt is promoting exports of food (including 
agricultural products); it aims to increase the valu e of Japanese food exports to ¥1 trillion by 2013.” 
 38. Given the fact that Japan wants to increase its  food self-sufficiency (39% to 45%) and at the 
same time its exports of fo od products, how will Japan ach ieve those two objectives?  
 
Part IV. Trade Polices by Sector: (2) Agricult ure; (ii) Policy developments: paragraph 18, 
page 75:   
The Secretariat Report notes that emergency tariff measures for import surges of beef and pork in 
accordance with the Temporary Customs Tariff Measur es Law were last triggered for beef in FY2003 
and for pork from FY2001 to FY2004. 
 
39. Can Japan provide details on any potential re form to the beef and pork emergency tariff 
measures that may take place?  
Part IV. Trade Polices by Sector: (2) Agricult ure; (ii) Policy developments: paragraph 20, 
page 76:  
 
The Secretariat Report states that the price suppo rt schemes for "wheat, sweet potatoes, white 
potatoes, sugar beets and sugar cane were transf ormed into a direct payment scheme" in 2007. 
 40. Could Japan provide a description, including the amount of support by product in 2007 and 
2008, of the new direct payment scheme? 
 WT/TPR/M/211/Add.1 
Page 74  
 
  Part IV. Trade Polices by Sector: (5) Services; ( ii) Financial Services: paragraph 33, page 81: 
 
The Secretariat Report states that "[o]ther reform measures adopted recently include:  allowing banks 
to sell all insurance products over the counter (22 December 2007)." 
41. What has been Japan's experience in allowing banks to sell insurance products, i.e. how has it 
affected consumer choice, pricing, and has it had any structural effects on the insurance sector?   
 
Part IV. Trade Policies by Sector: (5) Serv ices; (ii) Financial Services; (a) Banking: 
paragraph 38, page 84: 
 The Secretariat Report states that the "Government intends to review the firewall regulation between 
banking and securities (Chapter III(4)(v))."  42. Can Japan expand on the stat us and process of the review of  the firewall regulation between 
banking and securities?  What factors led to the revi ew and are there any preliminary findings that you 
could share? 
 
Part IV. Trade Policies by Sector: (5) Serv ices; (ii) Financial Services; (a) Banking: 
paragraph 39, page 84:  
The Secretariat Report states "[m]ain reform in Japan's banking sector since its previous Review include the privatization of Japan Post and incep tion of the Japan Post Bank under the Japan Post 
Holdings (Chapter I(3)(ii))."  43. Can Japan expand on the status and process of privatizing Japan Post?  For example, who will 
regulate the new entity and will there be any aspects th at remain unregulated (i.e. grandfathered under 
the old regime)? 
 
Part IV. Trade Policies by Sector: (5) Servic es; (ii) Financial services: (c) Securities: 
paragraph 51, page 87:  
The Secretariat Report states that "…the ASBJ will diminish major differences that the Committee of 
European Securities Regulators iden tified with the International Fina ncial Reporting Standards;  other 
current differences will be addressed by the ASBJ by June 2011…". 
 
44. What progress was achieved by Japan in 2008 regarding the reduction of major differences 
with the International Financial Reporting Standards?   Could Japan outline its plan to eliminate other 
differences by 2011? 
 
Part IV. Trade Policies by Sector: (5) Services; (iv) Transport; (b) Air transport: paragraph 68, page 92: 
 
It is noted that Japan has been promoting the Asia n Gateway Initiative that aims to position Japan as 
an efficient conduit for people and goods between Asia and the rest of the world. 
 45. Would Japan consider that further air libera lization would help achieve the objectives of its 
Asian Gateway Initiative? 
  WT/TPR/M/211/Add.1 
 Page 75 
 
 
  Part IV. Trade Policies by Sector: (5) Servic es; (v) Professional Services: paragraph 75, 
page 93: 
 
The Secretariat Report states that "in addition to obtaining relevant licenses, membership of a professional association is compulsory for: certif ied public accountants, administrative scriveners, 
lawyers, judicial scriveners, land and house survey ors, licensed tax accountants, public consultants on 
social and labour insurance, and patent attorneys."   46. Could Japan clarify the requirements for memb ership in those associations, and identify if 
there are different requirements for Japanese nationals and foreigners?  
Part IV. Trade Policies by Sector: (5) Servic es; (v) Professional Services; (b) Accounting 
Services: paragraph 78, page 94: 
 
The Secretariat Report indicates that amendments to  the Certified Public Accountant Act (CPA) in 
2007 permit foreign accountants not qualified as a CPA in Japan to provide auditing services specified 
in Article 2-2 of the CPA Act under certain conditions.   
 47. Could Japan clarify the conditions under whic h foreign accountants not qualified as a CPA in 
Japan are permitted to provide the specified auditing services? 
  AUSTRALIA
 
 I. ECONOMIC ENVIRONMENT  (2) M
ACROECONOMIC POLICIES  
 
(ii) Fiscal Policy  
1. Could Japan outline how its plans for fiscal consolidation have changed from the original 
target of achieving a primary balance surplus by FY2011?   
2. When is primary balance likely to be attained? 
 
II. TRADE POLICY REGIME:  FRAMEWORK AND OBJECTIVES  (1) I
NTRODUCTION  
 3. "The agreements (regional and bilateral free-trade agreement) with countries that are 
significant exporters of agricultural products tend to exclude many of these products".  
 - Can Japan please explain how these free-trade agreements meet Article XXIV.8(b) of GATT 
requiring the coverage of ‘substantially all trade’? 
 
(2) T
RADE POLICY OBJECTIVES  
 
4. We note in the Secretariat’s report that Japan views bilateral trade agreements as useful tools 
for market liberalisation and structural reform. 
 
- In its bilateral trade agreements to date (including those under negotiation), how has Japan 
applied this sentiment to its agricultural sector? 
 WT/TPR/M/211/Add.1 
Page 76  
 
  (4) T
RADE AGREEMENTS AND ARRANGEMENTS  
 (iv) Preferential treatment  
 
5. The Secretariat's report highlights that under the Generalised System of Preference Scheme 
(GSP) for LDCs the tariff line coverage has increased to 98%, which is a positive development.  For 
the remaining 2% of tariff lines, the applied MFN rates apply.  The products include, for example, 
rice, refined and centrifugal raw sugar and articles of leather and footwear. 
 - Can Japan please elaborate if it will expand LDC duty-free/quota-free treatment to all 
agricultural products, given the importance of these products to economic growth and 
development of these countries? 
 6. Australia welcomes Japan's efforts to exte nd its duty-free and quota-free (DFQF) preferential 
treatment for LDCs.  Australia notes that Japan's DFQF preferential treatment covers tariff lines 
including dairy, wheat and barley products. 
 - For these lines, does DFQF preferential treatment  entail that Japan refrain from applying any 
other border charges (such as mark-ups or surc harges) to these imports, where applicable? 
 
(5) F
OREIGN INVESTMENT REGIME  
 
7. The Ministry of Economy, Trade and Industr y's "White Paper on International Economy and 
Trade 2008" noted that the Japanese Government had adopted the expansion of inward direct 
investment as one of its major po licies, so as to double inward foreign direct investment to around 5% 
of GDP by 2010. 
 
- What changes has Japan made to its investment regulations to make investment in Japan more 
attractive for overseas investors? 
 - Australia understands that Japan's Fair Trade Commission (FTC) plans to transfer its appeals 
process to the court system.  Would Japan consid er adopting a similar proposal for appeals on 
foreign investment decisions? 
 
III. TRADE POLICIES AND PRACTICES BY MEASURE 
 (3) M
EASURES DIRECTLY AFFECTING EXPORTS  
 
(iii) Export prohibitions, restrictions, and licensing  
 
8. "Export controls (prior approval) are maintain ed to ensure national security and public safety 
and to ensure adequate domestic  supplies of certain agricultura l and other primary products".  
 
- Can Japan please list the agricultural and other primary products by tariff line covered by 
these export controls?  
 - Can Japan provide details of whether the expor t controls have been utilised in the past 5 
years, and if they have, can the value and volume  of the relevant products affected by export 
controls be provided? 
  WT/TPR/M/211/Add.1 
 Page 77 
 
 
  IV. TRADE POLICIES BY SECTOR 
 (1) I
NTRODUCTION  
 
9. The Secretariat's report highlights the con tinuing significant disparity between agricultural 
and NAMA applied tariffs – 17.1% (a griculture) vs. 3.6% (NAMA).  
 - Can Japan please explain whether it plans to implement a review and reform process to 
remove this disparity? 
10. Can Japan explain what the type and nature of non- ad valorem  duties are and how they are 
converted to ad valorem  equivalent tariff rates?  
(2) A
GRICULTURE  
 (i)  Overview 
 11. The Secretariat's report highlights that Japan's Basic Law on Food, Agriculture and Rural 
Areas contains a guideline to achieve a food self-sufficiency ratio of 45% by FY2015 (currently reported to be 39% in FY2006, down from 40% in FY2002).  - Can Japan please explain how a target of 45% was derived and how does Japan plan to reach 
the target? Also, when is this target reviewed, if at all? 
 
- Are greater levels of government interventi on planned (i.e. through MAFF or ALIC) to reach 
the desired self-sufficiency ratio? 
 - How much will the Government spend in the financial years 2008-09 and 2009-10 on import 
substitution food education campaigns? 
 12. The Secretariat's report highlights that Japan’s overall level of government support for agriculture (based on PSE/CSE figures) remains well above the OECD average;  labour productivity 
is still less than a quarter of the national average and tariff barriers remain high.  
- Is there a link in Japan between the falling le vel of food self-sufficiency, the heavy levels 
agricultural protection and the low levels of labour productivity? 
 - Will the agricultural sector continue to r eceive substantial suppor t despite this low 
productivity? 
 
13. In January 2009 the Japanese Government announ ced the establishment of a 'six ministers' 
conference on agricultural reform.  - Can Japan provide specific details of its agricultu ral reform strategy, particularly in relation to 
addressing high food prices and low labour produc tivity, and achieving its goal of 45% food 
self sufficiency? 
 14. While in May 2005, the Japanese Government  introduced new direct agricultural payment 
assistance measures and eliminated  some price support measures, the level of government support 
continues to be approximately 1% of GDP. 
 
- Can Japan explain the reasons for targeting par ticular farming groupings  ("core farmers") for 
the new direct payment assistance? WT/TPR/M/211/Add.1 
Page 78  
 
  - Can Japan please explain whether the shar p reduction of Japan’s  amber box support has 
affected its agricultural production? 
 - Furthermore, have the reforms been effective in  reducing the trade-distorting nature of Japan's 
domestic support regime, especially for rice? 
 
- What amendments has Japan made to the ne w direct agriculture pa yment assistance measures 
since they were implemented?   
 - Have these changes undermined the original policy intent of the measures to increase 
economies of scale and therefore the effici ency and competitiven ess of the Japanese 
agriculture sector? 
15. Japan uses a “historical reference amount” to determine whether farmers may receive income 
support.  
- Can Japan explain what the specified base period is, and how it is determined? 
 
(ii) Policy developments  
 
16. Japan has sizable applied tari ff peaks, with a reported applied rate of 578.6% for peas (FY08). 
This may still not provide a full picture since many other highly protected products like dairy, swine, 
rice and cereals, do not have available AVEs (93 tariff lines at the 9-digit level).  For example, the 
AVE for rice in the past has b een in the vicinity of 700%. 
 - Can Japan please justify the need to  maintain such high tariff levels? 
 
- Can Japan please explain why AVEs were not available for the 93 tariff lines, many of which 
cover products of importance to exporters from other countries, especially developing 
countries? 
 - What domestic reforms is Japan undertaking to  enable the removal of these tariff peaks? 
 
17. The Secretariat's report highlights the stri ngent requirements placed on agricultural tariff 
quotas, especially those subject to end-use restricti ons like imports for school lunches, feed purposes 
and recombining in Okinawa.  - Can Japan explain the justification for these kinds  of non-tariff barrier (NTBs) restrictions and 
how they affect the level of imports and tariff quota fill rates? 
 18. The Secretariat's report highlights the complex import arrangements involving state-trading entities, primarily MAFF and the Agriculture and Li vestock Industries Corporation (ALIC).  These 
are coupled with complex arrangements like simult aneous buy-and-sell (SBS) systems, mark-ups on 
existing tariff quotas on wheat, rice and dairy.  Un scheduled behind-the-border primary and secondary 
surcharges are also charged on sugar, operating like a tariff quota, but a 0% applied tariff on sugar is 
notified to the WTO.  - Can Japan please explain the justification for these kinds of non-tariff barrier (NTBs) 
restrictions and how they affect the leve l of imports and tariff quota fill rates? 
 
- Can Japan please explain why it doesn't notify all the additional mark-ups, surcharges and 
levies when reporting its applied tariff to the WTO Secretariat? 
  WT/TPR/M/211/Add.1 
 Page 79 
 
 
  - Can Japan please explain the legal basis for th ese kinds of duties when Article 4.2 of the 
Agreement on Agriculture requires all variable import levies, discretionary import licensing, 
and non-tariff barriers maintained by state-trad ing enterprises to be converted to ordinary 
customs duties? 
 
- Are there any requirements or obligations for sugar importers to sell or purchase imported 
sugar to or from the ALIC in order to receive preferential market access? 
 - If so, could Japan explain the related admi nistrative arrangements, including importing and 
on-selling rights, together with any pricing arrangements? 
 
- With the possible conclusion of the Doha Round in 2009 and the focus on market access and 
the option for tariff quota expansion, can Japan  ensure that any new tariff quotas resulting 
from the Doha Round will not be subject to AL IC or MAFF control, end-use requirements, 
simultaneous buy-and-sell (SBS) sy stems, surcharges and mark-ups? 
 
(5)
  S ERVICES  
 (i)  Overview  
 
19. Australia notes that the services sector is th e largest contributor to GDP and employment in 
Japan. Australia further notes inwa rd FDI in Japan is relatively lo w compared with that of other 
OECD countries.  As the WTO Secretariat Report st ates, Japan is taking measures to make itself a 
more attractive investment destination for foreign firms, in order to further benefit from this vital 
sector.  
- Will these reforms include revising Article 821 of the Corporations Law, which prohibits 
foreign companies from doing business in Japan in  branch form under certain circumstances?  
 
(ii) Financial Services 
 
(c) Securities 
 
20. The Financial Instruments and Exchange Law (FIEL) entered into force in Japan on 
30 September 2007.  Under the FIEL, the types of "other business" that firms can undertake are not defined.    
- Will Japan consider modifying FIEL to include  language that makes it clear to businesses in 
the funds management business what types of business they can engage in? 
 
(v) Other Services 
 
Education services 
 21. At the WTO Ministerial Services Signalling Conference in 2008, Japan indicated it may be 
considering new commitments on Modes 1 and 2 in Higher Education.  - Can Japan provide further details of these possible new commitments? 
 
Labour markets 
 
22. Japan's "Basic Policies 2008" released by th e Council for Economic and Fiscal Policy says 
that Japan will enhance its international hum an resources by implementing the "Plan for WT/TPR/M/211/Add.1 
Page 80  
 
  300,000 Exchange Students" in Japan  and enlarging the immigration program to accept more skilled 
foreign workers.  Australia notes that similar pr oposals have been put forward in previous CEFP 
reports, such as the "Strategy in the Globalizing Economy" of 2006.  - Could Japan provide an update of the specifi c measures which it is putting in place to realise 
this goal, including extensions of eligib le visa periods and increasing the range of 
professionals granted permission to work in Japan? 
 
 
NORWAY
 
 
WTO Secretariat's report (WT/TPR/S/211). 
 
III. TRADE POLICIES AND PRACTICES BY MEASURE 
 
Measures directly affecting imports 
 
Para. 7 states that "About 96% of Japanese I ndustrial Standards (JIS) were aligned to their 
international counterparts in 2008 (compared with 93% in 2005)".  Could Japan provide information 
if there are any plans on further enhancing the comp atibility of Japanese Industrial Standards (JIS) to 
international standards?  Are there available stat istics regarding the application and acceptance of ISO 
standards in Japan? 
 As reflected in para. 47, Japan has continued its efforts towards international harmonization of its 
standards and technical regulations.  Could Japan pl ease elaborate on the efforts that have been made 
since their last trade policy review, and i ndicate whether new initiatives are foreseen?  
 
IV. TRADE POLICIES BY SECTOR 
 Services 
 
Para. 61 states that "the government intends to re duce lead time and charges at ports by adopting 
concrete measures to realize cost-reduction target s under the Super-Hub Port Project".  Could Japan 
please shed some light on which concrete measur es will be implemented, and indicate when the 
project will be completed?  Many shipping countries face challenges in respect of recruiting national seafarers (as it is indicated in 
para. 62).  Has Japan any measures in force in orde r to stimulate the use of Japanese seafarers (i.e. 
taxation or similar measures)?  We understand from the report's para. 62 that no discr iminatory measures exist with respect to supply 
of auxiliary services, except for mode 1 and 3 of maritime freight forwarding services.  Could Japan elaborate on the discriminatory measures that exist for freight forwarding? 
 
Para. 63 gives information on a new tonnage tax sy stem.  Could Japan please provide information on 
which companies that are eligible for the tonnage tax?  Is the ne w system open for foreign flagged 
vessels and/or companies?  We would also like to know how tax liabilities from the previous tax 
system are being treated.  Do such  liabilities have to be paid, or are they suspended or remitted? 
 
Norway would also like to request information on th e requirements for a lock-in period in the tonnage 
tax system.    WT/TPR/M/211/Add.1 
 Page 81 
 
 
  Para. 64 reads as follows;  "Agreements between dom estic and foreign operators on freight rates or 
other conditions of transport (e.g. routes) are ex empt from the Anti-monopoly Act…".  These kinds of 
agreements have been restricted or banned in othe r parts of the world for various reasons during the 
last years.  Due to this fact, shipping companies ar e exposed to conflicting legi slation on certain trade 
routes.  On this background, we would like to ask  Japan if the Japanese authorities have any plans of 
reform of competition rules in the area of maritime transportation. 
 Para. 65 states that:  "In Japan's revised services offer, maritime cabotage services, international 
freight forwarding, and international shipping services are subject to MFN exemption".  In the list of 
MFN-exemptions “all countries” are listed as candida tes to which the respective measure applies.  
Could Japan shed some light on the actual use of any of these measures?  We would also kindly ask 
Japan to provide an updated list of the countries that the MFN exemption would apply to, and we would appreciate if the list could indicate any en tries of new countries to the list over the last 
10 years.  
Para. 68 describes the developments in the Japanese ci vil aviation policy.  We are pleased to note that 
Japan has started to liberalize its civil aviati on policy.  Could Japan please elaborate on the 
liberalization process, and estimate a time schedule towards a full open skies policy?   
ARGENTINA
 
 
WT/TPR/S/211, INFORME DE LA SECRETARIA  I. EL ENTORNO ECONÓMICO 3) Políticas Estructurales 
i) Reforma Fiscal 
 Párrafos 15, página 8  
El informe indica que Japón ha efectuado recientement e una reforma fiscal con el objetivo de ampliar 
la base impositiva y la racionalización del impu esto de sociedades. Asimismo, se indica que 
próximamente Japón aplicará un aumento en el impu esto sobre el consumo. Podría Japón indicar: 
 - ¿En qué consiste la reforma fiscal mencionada?  - ¿En qué medida se incrementará el impuesto sobre el consumo y a partir de cuando se 
aplicaría ese incremento? 
 
II. REGIMEN DE POLÍTICA COMERCIAL: MARCO Y OBJETIVOS 5) Regimen de Inversiones Extranjeras i) Regimen normativo   
Párrafo 57, página 34 
 
El informe indica que, en 2007, el Gobierno revisó la reglamentación de la IED directa para impedir 
que las inversiones extranjeras afectaran negativam ente a la preservación de la base industrial 
relacionada con la defensa del Ja pón y la proliferación de tecnologí as sensibles relacionadas con las 
armas de destrucción masiva.  De acuerdo con esta modificación, los productos considerados 
"transformables en material militar" se añaden a una lista de productos sujetos a notificación previa. 
Podría Japón indicar ¿Cuáles son los productos que se consideran "transformables en material 
militar"?  WT/TPR/M/211/Add.1 
Page 82  
 
  ii) Medida de fomento de las inversiones  
 Párrafo 62, página 35 
 
En el mencionado párrafo, el informe menciona que  el gobierno ha puesto en marcha un proyecto de 
promoción de la inversión extranjera directa en de terminadas administraciones regionales, y que en el 
año 2007 se habían seleccionado 17 regiones en las cuáles se aplicarán dicha promoción. 
 - ¿Podrían explicar en qué consiste est e proyecto de promoción de las IED? 
- ¿Cuál es el criterio de selectividad de las regiones que se benefician del régimen? 
 
- ¿Cuáles son los requisitos que deben cumplir las empresas extranjeras para acceder a este 
incentivo? 
 
III. POLÍTICAS Y PRÁCTICAS COMERCIALES, POR MEDIDAS 
1) Introducción  
 
- ¿Podría indicar qué medidas de orden comerc ial han sido tomadas por Japón para hacer frente 
a la crisis financiera económi ca internacional desde julio de 20 07, particularmente en materia 
de subsidios, subvenciones, nacionalizacion es u otras formas de  asistencia estatal?  
 
2) Medidas que afectan directamente las importaciones 
i) Procedimiento de despacho de aduana   Párrafo 16, página 40 
 El informe indica que las autoridades el Japón tenían  previsto introducir el Portal Común para la 
Ventanilla Única de Nueva Generación para el mes de octubre de 2008, cuya finalidad es unificar las 
formalidades de solicitud por medios electrónicos para  los distintos organismos. ¿Podrían confirmar si 
este Portal ya se encuentra en funcionamiento y de no ser así podrían indicar el grado de avance del proyecto y las fechas estimadas para que se encuentre operativo?   iii) Medidas no arancelarias en frontera 
d) Vigilancia de las importaciones  
 
Párrafo 34, página 49  
En el mencionado párrafo, el informe indica que Ja pón mantiene un sistema de confirmación previa 
con el fin de reunir datos sobre determinadas impo rtaciones, para asegurar que se destinan a usos 
específicos, y para verificar la documentación y lo s requisitos de origen. ¿Cuáles son los productos 
abarcados por este sistema de confirmación?   
4) Medidas que afectan a la producción y el comercio 
i) Tributación y ayudas fiscales  
 Párrafo 78, página 64  
En el párrafo 78, el informe menciona que los in centivos fiscales en Japón están establecidos en la 
Ley de Medidas Fiscales Especiales, la cuál se mo difica en forma anual. Como ejemplo de esta 
medida el Informe indica que se ofrecen incentivos para  la difusión de la banda ancha). ¿Podría Japón 
precisar cuáles son los incentivos fiscales que establecen esta Ley y los sectores beneficiados, así como indicar cuáles son los criterios para determ inar su aplicación y los períodos de vigencia?  WT/TPR/M/211/Add.1 
 Page 83 
 
 
  iv) Derechos de P.I.  
 
Párrafo 87, página 67 y párrafo 100, página 71 
 
En estos párrafos el Informe de la Secretaría indi ca que ahora la Aduana pue de impedir de oficio el 
tránsito de mercancías que infrinjan los de rechos de propiedad intelectual (DPI).  
 - ¿Podría Japón indicar qué derechos de P.I. se pr etende proteger mediante estas intervenciones 
de oficio?.   
- ¿Podría detallar el procedimiento seguido por la  Aduana para determinar si las mercaderías 
infringen derechos de PI y l as posibilidades que se les ofrecen a las partes involucradas para 
presentar su descargo?  
 - ¿Cuáles es el plazo máximo que dispone la  A duana para la determinación de la infracción del 
derecho?. De acuerdo a la experiencia registra da, ¿cuáles son son los plazos promedio que 
transcurren entre la detención de la mercad ería y la determinación de la infracción? 
 - ¿Este procedimiento se aplica a las mercaderías en tránsito? ¿Existe un mecanismo que 
contemple una tramitación acelerada?. 
 
Párrafo 92, página 69 y párrafo 97, página 70  
 Estos párrafos refieren a las activ idades de cooperación realizadas por  Japón y señalan además que el 
18 de junio de 2008 la Sede de Política de Propiedad Intelectual publicó el Programa IPSP de 2008, 
que revisará desde la perspectiva internacional la estrategia japonesa en materia de propiedad 
intelectual.  Dicha estrategia se centrará, entr e otros aspectos, en "ejercer el liderazgo en el 
tratamiento de cuestiones mundiales comunes, en pa rticular aquellas a las que hacen frente los países 
asiáticos".  De acuerdo al Informe el énfasis de esta estrategia está centrado en promover la armonización internacional de procedimientos de so licitud y exámen relacionados con los derechos de 
propiedad intelectual. ¿Podría Japón informar si la mencionada estrategi a internacional contempla 
otros temas, por ejemplo, los vinculados a la Age nda del Desarrollo de la OMPI o a otras iniciativas 
regionales o multilaterales?   
 
vi) Políticas de competencia  
 Párrafo 108, páginas 74-75 
 En el párrafo 108, el informe menciona que la modificación introducida en 2006 a la Ley 
Antimonopolio permitió, entre otras cosas, la creac ión de un “Programa de Indulgencia” para las 
empresas. ¿En qué consiste este programa?  
IV. POLÍTICAS COMERCIALES, POR SECTORES 
3) Sector manufacturero  
 
Párrafo 24, página 93 
 
En el párrafo 24, el informe indica que existe en  el Japón una Ley de medidas especiales para la 
revitalización del dinamismo industrial, denominad a "Ley de Revitalización Industrial", destinada a 
promover la reestructuración y la innovación, la concesión de reducciones fiscales a los planes de 
adquisición aprobados por los Ministerios competentes.  WT/TPR/M/211/Add.1 
Page 84  
 
  - ¿En qué consisten las reducciones fiscales a qué hace referencia el informe? ¿Existen otros 
beneficios fiscales? 
 - ¿Cuáles son los requisitos que debe cumplir una empresa para acceder a dichos beneficios? 
 Párrafo 26, página 93 
 
En el párrafo 26, el informe menciona que Japón exige una notificación previa para la inversión 
extranjera directa en determinados subsectores manufactureros y que además, en algunos sectores se 
requiere autorización o se exige la presentación de info rmes ex post.  Por favor indiquen los sectores 
para los cuáles se requieren notificación y aque llos para los que se requieren autorización y/o 
informes ex post.  
5) Servicios 
iv) Servicios de transporte 
a) Transporte marítimo  
 
Párrafo 63, página 107 
 
En el párrafo 63 el informe menciona que el gobier no ha modificado la Ley de Transporte Marítimo 
en 2008 y ha introducido un "impuesto sobre el  tonelaje" aplicable al transporte marítimo 
internacional.   
 - ¿Cuáles son las causas por las cuáles se comenzó a aplicar este impuesto?  - ¿Cuál es la metodología de cálculo del mismo? 
 
IV) POLÍTICAS Y PRÁCTICAS COMERCIALES, POR MEDIDAS 4) Medidas que afectan a la producción y al comercio ii) Subvenciones y otras ayudas financieras   Página 65, párrafo 81  
 
En este párrafo se menciona que el Japón ha notificado a la OMC diversos programas de 
subvenciones específicos, y que en su notificaci ón más reciente, de septiembre de 2007, el Japón 
indicó que aplicaba 86 programas de subvenciones pa ra ayudar a los sectores de la agricultura, la 
silvicultura y la pesca, la industr ia, las finanzas y el transporte.  
 
- Respecto a las subvenciones a la pesca, ¿podría el Japón informar cuáles son sus efectos en el 
comercio y en el medio ambiente, en partic ular, si se han tomado medidas para evitar que 
contribuyan al exceso de capacidad y la sobrepesca?  
 - Asimismo, más allá de lo notificado por el  Japón en el documento G/SCM/N/155/JPN de la 
OMC, de 3 de septiembre de 2007, ¿podría el gobierno del Japón especificar si los programas 
continúan aún vigentes, si se les han introducido modificaciones, y si se han agregado programas adicionales a los ya notificados? 
   WT/TPR/M/211/Add.1 
 Page 85 
 
 
  COSTA RICA  
 
Informe De La Secretaría, WT/TPR/S/211 
 
III. POLÍTICAS Y PRÁCTICAS COMERCIALES, POR MEDIDAS 
2) M EDIDAS QUE AFECTAN DIRECTAMENTE A LAS IMPORTACIONES  
vii) Normas, y medidas sanitarias y fitosanitarias 
 
- ¿Cómo funciona el sistema de fichas sobre la seguridad de los materiales? ¿Aplica a los 
productos importados desde terceros países? ¿Qué tip o de productos están cubiertos por este sistema? 
(Página 55, párrafo 51) 
 - ¿Se realiza la designación de organismos de inspección extranjeros por parte de autoridades 
japonesas sin que existan acuerdos de reconocimient o? ¿Se aplican para ello los mecanismos 
establecidos en organismos como ILAC, IAF? ¿Es suficiente la certificación emitida por organismos 
de inspección extranjeros designados para el ingr eso de los productos a Japón? (Página 56, párrafo 
54)  - ¿Qué resultados y conclusiones ha alcanzado la  Comisión de Inocuidad de los Alimentos de 
Japón en relación con las evaluaciones de la inocui dad de los alimentos modificados genéticamente, 
que han venido realizando desde el 2003? (Página 58, párrafo 58).  
 
- La Ley sobre Condiciones Sanitarias de los Alimentos de Japón establece que es posible 
eximir de la inspección a los cargamentos de alimen tos, si en el momento de su importación en el 
Japón presentan el resultado de la inspección efectua da por una organización oficial de inspección en 
el país exportador. ¿Cuál es el pr ocedimiento que debe efectuar el Gobierno del país exportador para 
beneficiarse de dicha aceptación? (Página 58, párrafo 60). 
  
CHILE
 
 
III. POLITICAS Y PRÁCTICAS COMERCIALES, POR MEDIDAS. 
2) M EDIDAS QUE AFECTAN DIRECTAMENTE A LAS IMPORTACIONES  
iv) Medidas comerciales especiales  
¿Cuál es la duración de las investigaciones por salvaguardias, dumping y subsidios? ¿Existe 
diferencia entre ellas?  3) M
EDIDAS QUE AFECTAN DIRECTAMENTE A LAS EXPORTACIONES  
v) Planes de fomento de las exportaciones 
 
¿Posee Japón alguna cuantificación del impacto de sus políticas de promoción de exportaciones?  
 
PAKISTAN
 
 
1. Japan has entered into many bilateral tr ade agreements recently with a distinctive 
phenomenon of creating new TRQs especially for these bilateral agreements.  We would appreciate if 
Japan could share the experience of using this tool  and its compatibility with WTO rules dealing with 
such bilateral agreements.    2. Could Japan please elaborate the "positive lis t" system for specifications and standards 
maintained under SPS controls? WT/TPR/M/211/Add.1 
Page 86  
 
  Additional questions 
 
III. TRADE POLICIES AND PRACTICES BY MEASURES 
 
(1) I
NTRODUCTION  
 
2. Preferential tariff rates are offered to 141 developing countries and 14 territories under 
Generalized System of Preferences (GSP), includi ng additional preferences for 49 Least Developed 
Countries (LDCs).  
 
- Could Japan explain the eligibility criteria for their GSP scheme? 
 10. In June 2007, Japan adopted a new three- year program for promoting Regulatory Reform, 
which was further revised in March 2008.  The program aims to immensely strengthen Japan's 
international competitiveness and thereby increase economic growth. 
 
- Could Japan explain the salient features of th e program and their strategy to achieve that 
desired objectives? 
 
III. TRADE POLICIES AND PRACTICES BY MEASURE 
 
(4) M
EASURE AFFECTING PRODUCTION AND TRADE  
 
92. The Intellectual Property Strategic Program (IPSP) 2007 was adopted by the Headquarters on 
31 May 2007.  It stipulated, inter alia , that Japan would formulate "strategic communications 
technology, environment, and non-technology/materi als", provide International harmonization of the 
patent system though measures such as standardi zation of patent application format among the 
Trilateral Offices (the Japanese Patent Office (JPO), United States Patent and Trademark Office (USPTO), and the European Patent Office (EPO) and strengthen IPR-related law enforcement and 
border measures by Customs.  - Japanese authorities may like to share details of their Intellectual Property Strategy Program 
(IPSP) and how it is focused on strengtheni ng Japan’s international competitiveness? 
 94. Parallel imports are allowed in Japan in accordance with the principal of “international 
exhaustion”.  
- Would Japan inform about relevant laws where parallel importation is incorporated? 
 
IV. TRADE POLICIES BY SECTOR 
 (1) I
NTRODUCTION  
 4. Electricity prices in Japan have declined and ar e not necessarily higher than those     in other 
developed countries.  - What are those factors, which resulted in  decreasing the prices of energy in Japan? 
 (2) A
GRICULTURE  
 
8. Japan food sufficiency ratio on a calori es basis was 39 % in FY 2006.  Despite the 
Government's objective of raising it to 45%, it has been a declining trend (the ratio of 40% in 
FY 2002).  The authorities consider that the major fact or behind this declining trend is the change of  WT/TPR/M/211/Add.1 
 Page 87 
 
 
  diet:  decrease in the consumption of rice, where self-sufficiency is 100% an d increased consumption 
of livestock products and oils, necessitating imports of a large amount of feed grains and oils seeds. 
 - Whether Japanese Government has any pr ogram to liberalize the rice market? 
 (ii) Policy developments 
 
10. 174% of duties to agricultural goods (WTO) definition are non- ad valorem   
 - Would Japan indicate time frame for converting non- ad valorem  duties to ad valorem  duties? 
 
16. The Government of Japan is promoting expor ts of foods (including agricultural products); it 
aims to increase the value of Japanese food export to 1 trillion yen by 2013. 
 - Could Japan inform that how they would achieve  their target with limited liberalization of 
agricultural market? 
  
THE UNITED STATES
 
 
I. ECONOMIC ENVIRONMENT 
(1) M AIN ECONOMIC DEVELOPMENTS  
 
Page 4, paragraph 6 and Page 14, paragraph 36:   The Secretariat's report notes that Japan's growth 
prospects are tied to its "ability to strike a bala nce between monetary and fiscal policies in tandem 
with structural reforms" but that, at the same time , "the pace of (structural) reforms has apparently 
slowed down."  What additional steps, beyond those al ready being implemented, is Japan prepared to 
undertake to revitalize its structural reform agenda?  In as much as Japan has identified three priority 
sectors for reform – namely, agriculture, medical and nursing services, and air transport – what major reform measures is Japan considering in the nea r- to- medium-term regarding each of these sectors? 
 
(3) S
TRUCTURAL POLICIES  
(ii) Financial system and corporate reform  
Pages 8-9, paragraph 22:
  The Secretariat's report states that "Preferential treatment that had been 
accorded to Japan Post…(was) abolished in Octobe r 2007," yet preferential treatment exists in the 
area of express delivery services.  Specifically, Japan Post's Express Mail Service (EMS, an 
international express service) still receives significan t regulatory advantages in areas such as customs 
clearance that private operators with similar services  do not receive.  Moreover, while there is a real 
possibility that non-competitive postal services are subsidizing competitive services like EMS, Japan 
Post Service is not required to make accounting disclosures in sufficient detail to examine this 
relationship.  
a) When does Japan intend to correct inequiti es in customs treatment given to Japan Post 
Service (beyond planned February 2009 changes for postal items exceeding 200,000 yen) compared 
to private international express carriers which offer a similar international express service to EMS?   
 b)  Will Japan require that Japan Post Servi ce make accounting disclosures sufficiently detailed 
so that third parties can determine whether subsid ization of Japan Post Service's competitive services 
by revenue from its non-competitive services is taking place?   c)  If there are no plans to correct inequities in  the treatment of international express services, 
what is Japan's justification in light of:  (1) Article  2 of the Japan Post privatization law that calls for WT/TPR/M/211/Add.1 
Page 88  
 
  "equivalent conditions of competition" between Japan  Post companies and private firms;  and (2) 
given that Japan Post Service's domestic express se rvices were put on a level playing field with 
domestic express carriers?  
II. TRADE POLICY REGIME:  FRAMEWORK AND OBJECTIVES 
(1) I
NTRODUCTION  
 
Page 15, paragraph 4:   The Secretariat notes Japan's progress toward increasing transparency of 
trade practices and regulatory measures.  Yet para graph 15 (page 20) highlights continuing lapses, 
such as with respect to publicizing failures to publis h cabinet decisions.  Other lapses not identified in 
the Secretariat's report include (1) some Japanes e ministries and agencies enforce regulations 
according to their own generally applicable interpreta tions of regulations that are not made public in 
advance, and (2) there continue to be numerous  cases where ministries/agencies convene advisory 
groups to make recommendations on regulatory changes where meaningful opportunities are not 
provided to all interested stakeholders to express views before final decisions are made.  Will Japan 
commit to strengthen its requirements in these two ar eas to improve transparency further in order to 
improve Japan's overall environment for business and FDI? When will Japan require all ministries and 
agencies to publish Cabinet decisions and “understandings”?  
(4) T
RADE AGREEMENTS AND ARRANGEMENTS  
(ii) Regional agreements 
 
Page 21, paragraph 19:   The Secretariat reports that "Japanese Customs applies preferential tariffs 
based upon a bilateral FTA, or the AJCEP, dependi ng upon the certificate of origin of the item 
concerned, thus adding to the complexity of Japan's rules of origin."  Which preferential tariff applies 
in cases where Japan has a bilateral FTA with another signatory of the AJCEP?  Which rules apply?  
Those contained in the bilateral FTA or in the AJCEP?  How does the govern ment use the certificate 
of origin to determine which preferential tariff applies?  
(iii) Other agreements and arrangements 
(c) Japan–Singapore Agreement for an Economic Partnership 
 
Page 23, paragraph 28:
  The Secretariat notes that some tariff lines in the JSEPA have rates higher 
than zero, "partly because it is believed that elimin ation of these tariffs would not lead to significant 
trade expansion."  Footnote 16 also states that “the authorities maintain that duties have been 
eliminated for about 21% of Japan’s tariff lines in agriculture.”  
a) Why does Japan believe that elimination of tariffs would not lead to significant trade 
expansion? Why, if more tariffs were eliminated, would there not be significant trade expansion?  If 
there is no bilateral trade in these products to begin with, why not eliminate the duties?  b) Why did Japan choose to eliminate tariffs on such a limited number of agricultural tariff lines?  
 
Pages 24-25, paragraphs 31, 33, 34 and 35:
  These paragraphs indicate that Japan's EPAs with 
Malaysia, Thailand, Indonesia and Br unei cover a high percentage of b ilateral trade, but do not outline 
the percentages of tariff lines covered.  We assume that Japan eliminated tariffs on a high percentage 
of industrial tariff lines under each of these EPAs.  Wh at percentage of its agricultural tariff lines are 
eliminated under each of these EPAs? 
 Page 25, paragraphs 37 and 38:
  Does Japan foresee a resumption of negotiations with Korea in 
2009?  Does Japan foresee active negotiations with Viet Nam, India, Australia and Switzerland in 
2009?  WT/TPR/M/211/Add.1 
 Page 89 
 
 
  (5) F OREIGN INVESTMENT REGIME  
(ii) Investment promotion measures 
 
Page 30, paragraph 60 :  The Secretariat's report states that in FY2007 Japan adopted measures 
pertaining to the expansion of "allowable consideration" for triangular mergers.  Paragraph 61 on 
page 31  further references the five recommendations  of the Expert Committee on FDI Promotion 
submitted to the Council on Economic and Fiscal Polic y on May 20, 2008.  In light of Japan’s low 
percentage of foreign investment compared to other OECD economies, will Japan follow the Expert 
Committee's recommendations in order to facilitate further cross-border merger and acquisition (M&A) activities into Japan?  If so, what  specific measures will Japan undertake? 
 
III. TRADE POLICIES AND PRACTICES BY MEASURE 
(2) M
EASURES DIRECTLY AFFECTING IMPORTS  
(v) Government procurement 
 Page 43, paragraph 39:
  Are the designated cities (shitei toshi ) that are not covered by the WTO 
Agreement on Government Procurement (GPA) require d to apply the same laws, ordinances and other 
measures in their conduct of procurement as the 12 designated cities that are covered by the GPA? 
 - The "Reorganization and Rationalization Plan for Public Corporations," adopted by the 
Cabinet in 2001, set a goal of streamlining 163 pub lic corporations through abolition, privatization 
and incorporation as Independent Administration Agencies (IAA).   
 a) What is the percentage and number of IAA that have been created since the 2001 reorganization that are covered by the GPA?  
b) Are the IAA that are covered by the GPA allowed to apply their own procurement 
procedures?  If so, how does the Government of Jap an ensure that they comply with the GPA?  
 c) The process of creating IAA is unclear.  What  criteria does Japan use to determine if a new 
entity will be covered by the GPA?  
- The United States has continuing concerns w ith the excessive use by  Japanese entities of the 
exception in GPA Appendix I, Annex 2, Note 5 and Annex 3, Note 4(a) (" procurement related to 
operational safety of transportation").  For each  Annex, please provide the number and value of 
procurements in which this exception was used from 2004 through 2008.  
Page 43, paragraph 40
 of the Secretariat's report describes Ja pan's notifications of organizational 
changes in procuring entities subject to the GPA,  since 2006.  In addition to the notifications 
described, one of the notifications that has been pending since 2003 is Japan’s proposed withdrawal of 
the National Aerospace Laboratory (NAL).  This  notification is awaiting Japan’s responses to 
questions from the United States and other GPA Part ies.  Are the entities that assumed the functions 
of the NAL conducting their procurements in acc ordance with the GPA?  Please describe the 
procurements that have been conducted by su ch successor entities, the names of the entities 
conducting the procurements, and the proc urement procedures that were used. 
 Page 44, paragraph 41 states :
  "With a view to improving comp etitiveness and transparency in 
procurement procedures, the Government adopted  various measures in November 2007 including:  
adopting competitive bidding methods;  establishing a third-party body (in each central-government 
entity) that monitors all the entity's procurement contracts;  and establishing a monitoring system within the Ministry of Internal Affairs and Communications to oversee the activities of central 
government entities and their third-party monitoring bodies."  WT/TPR/M/211/Add.1 
Page 90  
 
  a) Please describe the "competitive bidding methods" that were adopted.   
 b) Is the "third-party body" independent of th e entity that it monitors?  If so, please describe how 
it is independent.  
c) What is the scope and type of monitoring co nducted by the monitoring bodies?  Do these 
bodies issue reports?  If so, are the reports made public?  Is information obtained by the Ministry of Internal Affairs and Communications' monitoring system made available to the public?  Where 
problems are identified in monitoring, what t ypes of corrective actions may be required? 
 
Page 44, Note 25 states:
 "All central government agencies reviewed single tendering contracts and 
have increasingly been introducing open tendering."  a) What type of "review" of single tende ring contracts was undertaken by the central 
government entities?  Did the review extend to th e use of single tendering contracts by public 
corporations?   
 b) Please describe the "opening tendering" that was adopted.    c) Please describe any pre-qualification requireme nts and registration requirements that apply to 
participation in procurements  conducted under open tendering. 
 
Page 44, paragraph 42
 states:  "Procurement under the basic guidelines must be ¥500 million or less 
per contract; any planned procurement exceeding this threshold must be separated or divided."  How 
does the Government of Japan ensure that the separ ation or division of proc urements in accordance 
with this provision is consistent with GPA Article II:3? 
 
Page 44, paragraph 43:  
 
a) notes that in 2006 nearly one-third of the procurement of goods and services above 
100,000 SDRs was conducted using single tendering.  Please describe the procedures used in "open 
tendering."  What measures is the Government of Japan taking to reduce the use of single tendering? 
 
b) describes the very low level of procurements awarded to foreign suppliers.  Suppliers that 
attempt to participate in Japan’s government pr ocurement market often cite the difficulty of 
participation in Japan due to lack of transpar ency, bid-rigging, the business evaluation system, pre-
qualification requirements, and other barriers.  What  actions is the Government of Japan taking to 
reduce the barriers that prevent or discourage partic ipation by foreign suppliers in its government 
procurement?  c) states that "Firms that have central governme nt-wide unified qualification for participating in 
tendering contracts for manufacturing and sales of products total 59,629 (as of 10 March 2008);  386 
of these firms have capital wholly or partially owne d by foreigners."  Please describe the "unified 
qualification for participating in  tendering contracts for manufacturing and sales of products."  Do 
these qualification requirements apply when open tendering is used?  
(vii) Standards, and sanitary  and phytosanitary measures 
(a) Standards, testing, and conformity assessment  
Page 46, paragraph 47:
 The Secretariat's report states "Japan  has continued its efforts towards 
international harmonization of its st andards and technical regulations." 
  WT/TPR/M/211/Add.1 
 Page 91 
 
 
  a) With regard to increased conformity w ith international prac tices and guidelines on BSE 
established by the World Organization for Animal H ealth (OIE), please describe Japan's achievements 
since its 2007 TPR and any additional actions it w ill take to further enha nce harmonization with 
international practices and guidelines.   
b) With regard to conformity with intern ational practices and guidelines on avian influenza 
established by the OIE, please describe Japan's achievements since its 2007 TPR and any additional 
actions Japan will take to enhance further harmoni zation with international practices and guidelines, 
particularly with regard to low pathogenic avian influenza (LPAI).  
c) With regard to conformity with interna tional practices and guidelines on organic production 
established by CODEX, please explain how Japan's zer o tolerance policy for transgenic organisms in 
organic products complies with CODEX Guidelines for organic production which clearly states:  "Organic agricultural practices cannot ensure that products are completely free of residues, due to 
general environmental pollution.  However, methods are used to minimize pollution of air, soil and 
water."  Please explain if and how domestic organic pr oducts in Japan are tested at the same level as 
imported organic products.  (b) Sanitary and phytosanitary measures 
 
Page 49, paragraph 56:  
The Secretariat's report states that there have been several revisions to 
Japan's food specifications and standards, including residue standards. 
 a) Japan's maximum residue level (MRL) enforc ement policy penalizes an entire industry in an 
exporting country due to a violation incurred by a single supplier from that country in cases where 
MRL tolerances established in the exporting country are less restrictive than Japan's MRLs.  How 
does this policy comply with Articles II and V of the Agreement on the Application of Sanitary and 
Phytosanitary (SPS) Measures?  What scientific ev idence is available to Jap an to warrant such a 
stringent enforcement policy on imported products?  Are all domestic products similarly subject to 
30% test and hold policies after a single violation within Japan?   b) Japan provides the general public with a list of  all violations of its MRL policy by exporting 
countries on the Internet.  Please identify where Japan publicizes similar violations of the MRL policy 
by domestic suppliers.  If Japan does not publicize domestic violations, how does it ensure that its 
enforcement measures do not arbitrarily or unj ustifiably discriminate between Members where 
identical or similar conditions prevail in acco rd with Article II of the WTO SPS Agreement? 
 
Page 49, paragraph 57:  
The Secretariat's report reviews Japan's new or modified SPS measures.  
Please explain how Japan's current post-harvest fungicide policy, which classifies post-harvest fungicides as a pesticide as well as a food additiv e and thus requires a second risk assessment to be 
conducted, complies with WTO requirements, as ou tlined in Article V of the WTO SPS Agreement.  
According to Article V, SPS measures should not be more trade restrictive than required to achieve 
their appropriate level of SPS protection. 
 
Page 50, paragraph 60:
  Japan's Food Sanitation Law appears to provide broad latitude for 
regulatory agencies, specifically the Ministry of Health, Labor & Welfare (MHLW), to extend "exemption" status authorization to recognized or ganizations.  Does the Food Sanitation Law cover 
products that are inspected by MHLW?  Specifically , are there any foods for which inspection must 
be conducted by MHLW and if so, what is the basis for this policy?   
 WT/TPR/M/211/Add.1 
Page 92  
 
  (c) Labeling and packaging requirements 
 Page 50, paragraph 64
:  What is the scientific basis upon which the Food Sanitation Law provides 
for the labeling  of abalone, squid, salmon roe, or anges, kiwifruit, beef, mackerel, salmon, gelatin, 
chicken, port, peaches, yams, and apples as allergenic substances? 
 
Page 50, paragraph 65 :  Was the Agricultural Products Inspection Law which required mandatory 
inspections of rice, wheat, barley, and soybeans notified to WTO?  Since this law regulates the 
mandatory labeling of transgenic foods under the Food Sanitation Law, how did Japan take into 
consideration other countries' comment s in developing this regulation? 
 
(4) M EASURES AFFECTING PRODUCTION AND TRADE  
(iv) Intellectual property rights 
 
Page 61, paragraph 101:   The Secretariat's report describ es a significant increase of small-lot 
shipments involving IPR infringement.  Given growth in the number of incidences involving IPR 
infringement, is Japan considering additional tools to  assist in the prosecution of IPR-related crimes 
such as by granting ex officio  authority to prosecute these types of crimes? 
 
(vi) Competition policy 
 Page 63, paragraph 108
:  The Secretariat's report states that the 2006 amendment to the 
Antimonopoly Act, among other changes, "expedite d JFTC's hearing procedures."  In light of 
business community concerns that those changes to  the hearing procedures resulted in inadequate 
procedural fairness for respondents, what measures, if  any, does Japan intend to take to ensure that 
respondents in JFTC hearing proceedings are afforded  due process protections that are in line with 
international best practices? 
 
IV. TRADE POLICIES BY SECTOR 
(2) A GRICULTURE  
(i) Overview 
 Page 72, paragraph 9: 
 The Government of Japan has announced a policy of reducing imports in 
order to meet food self-sufficiency goals.  Will this  government-led effort result in border protection 
beyond what is in Japan's country schedule? How does the Government of Japan plan to implement 
policies that reduce imports without nullifying or impairing market access currently enjoyed by WTO 
members? 
 
APPENDIX TABLES 
AIV.1 Tariff quota and in-quota imports, FY2005-06 
 
Page 118, Table AIV.1:   Why are fill rates for tariff quotas for many milk products much lower than 
the fill rates for other products such as grains?  Specifically, quota fill rates for many milk products 
are below 50%, while fill rates for grains are n ear 100%.  How does Japan account for this wide 
difference?  Is it a consequence of the in-quota tari ff rates being too high?  Is  there another reason?  
Please explain.  
(ii) Policy developments 
 
Page 72, paragraph 12:
  The Secretariat's report states that information on subsidies on rice was not 
provided to the Secretariat.  Additionally, the sp ecific duty is collected by Customs on behalf of 
Japan's State Trading Enterprise (MAFF) and placed in to "special accounts related to agriculture in 
the Central Government."  WT/TPR/M/211/Add.1 
 Page 93 
 
 
  a) Please provide data on the amount of subsidies provided for rice.  Additionally, please 
provide information on the special accounts where sp ecific duties are placed, including the use of the 
funds placed into the special accounts.  b) For Japan fiscal year 2007, Japan failed to meet its full in-quota tariff rate quota (TRQ) 
quantity for rice.  The unusual conditio ns in 2007/2008 that contributed to global rice prices that were 
higher than normal, although still below Japan's do mestic prices, exposed several weaknesses in 
Japan’s administration of its TRQ system for rice.  Is Japan reconsidering whether its import system 
for rice is necessary?  If Japan pl ans to continue operating a rice state trading enterprise, will the 
government guarantee that future mini mum access commitments will be met? 
 
Page 75, paragraph 18: 
 The Secretariat's report states that Japan reserves the right to implement 
"emergency tariff measures for import surges of b eef and pork, in accordance with the Temporary 
Customs Tariff Measures Law."  What is the current stat us of this measure?  If Japan intends to retain 
this measure in the upcoming fiscal y ear, how would it be implemented?  
 
(3) M ANUFACTURING  
 
Page 78-79, paragraph 24:   Please provide information on what types of tax reductions are provided 
to manufacturers under the Law on Special Measures for the Revitalization of Industrial Dynamism? 
 
Page 79, paragraph 25:   The Secretariat Report notes that Japan "intends assist [sic.] the 
development of manufacturing, including the aircraft  industry (e.g. the Mitsubishi Rear Jet project)."  
Please outline the measures Japan intends to undertak e to assist its manufacturing industry, including 
the aircraft industry.  (ii) Financial services 
 
Page 81, paragraph 33: 
 The Secretariat's report describes a refo rm measure to allow banks to sell all 
insurance products over the counter.  Are there curre ntly any plans to liberalize further the bank sales 
channel for insurance products such as through th e removal on the limits on sales of first and third 
sector products and treatment of customer data? 
 
(b) Insurance  Page 85, paragraph 40:
  The Secretariat's report states that Japanese authorities maintain that there 
are no state-owned insurance companies in Japan.  Please clarify this statement in light of the fact that 
the Japan Post Insurance Co. Ltd is fully owned by the Japan Post Holdin g, a fully state-owned 
holding company? 
 
Page 85, paragraph 42:   The Secretariat's report states that the criteria for granting licenses and the 
requirement of solvency margins are the same fo r Japanese and foreign insurance providers.  Please 
confirm that this statement is consistent with the treatment of corporate transactions by domestic 
insurers as compared to foreign insurers?  Our unde rstanding is that insurers incorporated in Japan 
have a number of options availabl e to them, such as mergers ( shinsetsu gappei ), spin-offs ( kaisha 
bunkatsu ), policy portfolio transfers ( houkatsu iten ), and non-portfolio transfers of the company’s 
business ( jigyou no jouto ).  However, the procedures availabl e to foreign insurance companies are 
limited only to policy portfolio transfers and non-portfolio transfers of the company’s business.  
Page 85, paragraph 43:
  The Secretariat's report states th at the Insurance Business Law was 
amended to establish a framework fo r unregulated insurance cooperatives ( kyosai ) that entered into 
force on 1 April 2008.  With respect to ministry-regulated  kyosai , what are Japan's plans or measures 
to ensure a level playing fiel d is established by bringing these  kyosai  regulated by various Japanese WT/TPR/M/211/Add.1 
Page 94  
 
  ministries under the same obligations and supervision as private sector compani es to the extent that 
they compete with private insu rance companies regulated by th e Financial Services Agency?   
 
Pages 85-86, paragraph 44:
  The Secretariat's report states that  Japan Post Insurance provides life 
insurance services under the same regulations applie d to other private insurance companies under the 
Insurance Business Act and that it faces various constraints including limits on the insurance amount 
per policy holder, limits on product variety, and investment restrictions during the period from 2007 
to 2017. 
 
a) As Japan implements postal privatization from October 2007 and prior to the full privatization 
of Japan Post Insurance, what procedures are in  place to ensure consistency with its Postal 
Privatization Law principle to establish "equal co mpetitive conditions" between the postal entities and 
"other companies engaged in like business operations"?  
b) What measures or procedures are in place to  ensure that the constraints on Japan Post 
Insurance, including limiting product variety, w ill remain in place until equivalent conditions of 
competition are achieved? 
 
(iii) Telecommunications 
 
Page 88, footnote 62:
  The Secretariat's report paraphrases a governmental policy of maintaining a 
one-third equity share in NTT by noting "The au thorities maintain that the Government holds the 
share for public interest and safety reasons."  Please  explain what is meant by "public interest and 
safety" reasons.  Is the Government of Japan consid ering eliminating this re quirement?  What would 
be necessary for it to do so?  
Page 89, paragraph 57:
  The report notes the efforts of the telecommunications regulator (MIC) to 
develop a comprehensive program to institute  appropriate competition safeguards in the 
telecommunications sector.  However, there is no mention of ongoing discussions regarding (1) a 
proposed new law regarding the convergence of telecommunications and broadcasting;  and 
(2) overall structure of NTT, including proposals to break up the company into fully independent 
units.  Please explain the status of these two in itiatives, and the rationale for not addressing these 
issues in a comprehensive manner.  (For example, st ructural separation is highly relevant to how any 
competition safeguards are implemented, as it is to issues of potential market power exercised by a company owning telecommunications infrastructure wh ich may seek to enter the broadcasting sector.) 
 Page 89, footnote 69: 
 In footnote 69, the report notes the key interconnection rates offered by NTT 
wireline and mobile operators as about 2.4 cents a mi nute and 12 cents a minute, respectively.  With 
respect to the wireline rate, this appears significantly above typical tandem level rates in OECD countries (a comparable U.S. rate is about one-fo urth that amount, European, Mexican and Koreas 
rates about one-half.)  What effort is Japan maki ng to bring this rate down to internationally-
comparable levels?  With respect to NTT's mobile interconnection rate, does the regulator believe that 
voluntary efforts by NTT to reduce this rate are su fficient, given the negligible reductions in recent 
years, and the persistently high level the rate remains at?  If, as appears to be the case, NTT mobile 
falls within the definition of a “major supplier,” shoul d it not be required to offer cost-oriented rates? 
 
(iv) Transport 
(a) Maritime transport  
Pages 90 and 91 of the Secretariat’s report:
 
 
a) Under the Port Transportation Business Law, new terminal operators are required to conduct 
all terminal operations as a joint venture or under a close ties relationship with established Japanese  WT/TPR/M/211/Add.1 
 Page 95 
 
 
  operators.  Has this requirement been modified or  eliminated?  Are foreign companies permitted to 
establish their own stevedoring services operations (l oading and unloading of containers) in Japanese 
ports, based on the principle of national treatment ?  Do any non-Japanese companies (either shipping 
lines or marine terminal operating companies) operate stevedoring or marine terminal businesses in any of Japan's major ports? 
 
b) Has the power of the Japan Harbor Transpor tation Association (JHTA) to control carrier 
operations through the prior consultation mechanism been reduced or eliminated through any of 
Japan's port reform initiatives?  If JHTA's power ha s been reduced or eliminated, has such power or 
authority been transferred to or assumed by , any other entity, or ganization or person? 
 
c) How many port transport business companies, based on nationality, have been approved at 
Japan ports for each year since 2004?  For each year since 2004, please identify for each company 
which has been approved the type(s) of business(es) (e.g., marine terminal operator) and the port(s) 
for which approval was given.  What changes has the government made since 2004 in the application 
procedures or substantive qualifications for forei gn companies to establish port business companies? 
 (b) Air transport  Page 92, paragraph 71
: Regarding airport landing fees, in what ways have Japanese airports (and the 
Government of Japan, as 100% shareholder of Nar ita Airport) been guaranteeing transparency as 
recommended by ICAO? 
  
NEW ZEALAND
 
 
Section II:  Trade Policy Formulation and Evaluation   
Question 1 (WT/TPR/S/211, p.16, para 8):  Further to New Zealand's Question 5 from the 2007 
Review, could Japan please provide an update on any specific plans to pursue an intensified 
programme of bilatera l FTA/EPA negotiations? 
  
Question 2  (WT/TPR/S/211, p.16, para 8):  Ho w does Japan assess the quantitative and qualitative 
benefits to date of FTAs to which it is a party, as well as their expected effects?  
Section III:  Trade Policies and Practices by Measure 
 
Investment Promotion Measures 
 
Question 3 (WT/TPR/S/211, p.30, para 60 and WT/TPR /S/211, p.71, para 7):  Are there any policies 
in place to introduce foreign investment or particip ation specifically into Japanese agriculture to help 
raise productivity etc?  Measures Directly affecting imports: Tariffs  
Question 4 (WT/TPR/S/211, p.36, para 20):  New Zealand notes that Japan unilaterally reduced 
applied MFN tariffs on petroleum and industrial al cohol in FY2008. Could Japan please explain why 
it took these steps? 
 
Standards, and sanitary and phytosanitary measures 
 
Question 5 (WT/TPR/S/211, p.46, para 48):  To wh at extent are Japan's Agricultural Standards 
aligned with international standards? WT/TPR/M/211/Add.1 
Page 96  
 
  Question 6 (WT/TPR/S/211, pp.46-8, paras 48-54):  In 2005 we sought clarifica tion on equivalence of 
recognition of safety in 2005 (i.e. question 8, to  which Japan responded that regulatory authorities 
evaluate the comparability of conformity assessment schemes and equivalence of technical competence but that the specific ways of judgi ng the equivalence of recognition depended on each 
regulatory authority).  Can Japan please explain how  it assesses the equivalence of safety of different 
materials in construction standards?   
 Question 7 (WT/TPR/S/211, p.46, para 48):  To what  extent are Japan's Industrial Standards aligned 
with international standards?  
Question  8 (WT/TPR/S/211, p.49, para 57):  The Secretariat notes that Japan has amended its non-
quarantine pest list each year since 2006.  The list, however, is still small resulting in regular 
fumigation of imported products wh en organisms are found that are not on the list.  Is there any 
reason why the list developed by the Japanese Mi nistry for the Environment of alien species 
recognised to be established in Japan or found in  the Japanese wild (as of October 2004) cannot be 
added directly to the non-quarantine pest list?  
 
Section IV: Trade Policy by Sector: Agriculture  
Question 9 (WT/TPR/S/211, p.75, para 19):  The Secretariat's report notes that Japan's PSE is 
provisionally estimated at 45% for 2007. This  is a decrease from 55% in 2004-2006, a move 
New Zealand welcomes, although it remains well a bove the OECD average.  Does Japan intend to 
reduce the support it provides to its farming sector further over the next two years? 
 Question 10 (WT/TPR/S/211, p.74, para 14):  The S ecretariat's report notes that authorities consider 
the factors limiting the increase in farming scale in clude instability of income, prices of products, 
dispersed farmland ownership, and inclination to hold land as asset ra ther than for production.  How 
does Japan intend to deal with each of these issues to strengthen its agricultural production base? 
 Question 11 (WT/TPR/S/211, p.71, paras 8-9):  New Zealand notes that despite a small increase in 2008, Japan's food self sufficiency rate remains around the 40% level on a calorific basis.  This is 
despite the objective contained in Jap an's Basic Agricultural Plan to ra ise the food self sufficiency rate 
to 45% by 2015.  Has Japan considered strengtheni ng its trade linkages with food exporting nations to 
secure a stable supply of food?   Question 12 (WT/TPR/S/211, p.71, para 8):  What lessons has Japan drawn from the food crisis regarding the role of trade to supplemen t its limited domestic production capacity? 
  
Question 13 (WT/TPR/S/211, p.75, para 17):  We unde rstand that Japan faced a shortage of butter 
supplies during 2008, and had to conduct emergency imports of bu tter using the current access quota 
to make up for this shortage.  However, this incr ease in imports led to the automatic triggering of 
volume-based special safeguards against butter imports.  Has Japan considered taking any measures to ensure that the special safeguards are not triggered in situations where imports are essential to make 
up for a shortfall in domestic production? 
 Question 14 (WT/TPR/S/211, p.74 paras 12-13:  Are there any long-term plans for the Japanese agricultural industry to move away from setting pr oduction targets for the purpose of regulating the 
domestic supply of some products?  
 
Question 15 (WT/TPR/S/211, p.75, para 16):  New Zealand noted with interest that Japanese 
agricultural exports have continued to increase.  Could Japan please describe what trade policy issues 
it has encountered in promoting sales of  Japanese agriculture products overseas? 
  WT/TPR/M/211/Add.1 
 Page 97 
 
 
  MALAYSIA  
 
1. We note that Japan has the zero standard on melamine at 0.5ppm while in many other countries the acceptable melamine level is 2.5ppm in  food.  Zero standard of melamine is not 
practical.  Is Japan considering re vising the standard on melamine? 
 
 
ECUADOR
 
 
Reporta de la Secretaría WT/TPR/S/211 
 
I. EL ENTORNO ECONÓMICO 
 3) P
OLÍTICAS ESTRUCTURALES  
 El párrafo 14 señala que las reformas a la agricultu ra conllevarán la separación de los reglamentos 
sobre la propiedad de las tierras de los reglamentos sobre el uso de las mismas.  1. ¿Podría proporcionar mayor detalle acerca  del objetivo que se quiere obtener con esta 
medida?  II. RÉGIMEN DE POLÍTICA COMERCIAL: MARCO Y OBJETIVOS  4) A
CUERDOS COMERCIALES  
 i) OMC 
 
a) Participación en la OMC  En el párrafo 16, se hace referencia a la puesta en  marcha por parte del Japón de la Iniciativa de 
Desarrollo del Comercio, un conjunto completo de medidas de ayuda al d esarrollo destinadas a los 
países en desarrollo. 
 
2. ¿Cuál es el estado actual de esta iniciativa?  
iv) Trato preferencial 
 
El párrafo 51 se menciona la existencia de pro ductos industriales sensibles a los cuales se les aplican 
diversos tipos preferenciales hasta los límites máximos especificados.  3. ¿Cuáles son esos productos industriales sensi bles? ¿Existe un sitio electrónico donde sea 
posible encontrar esa información?  
4. ¿Cuál es el procedimiento para el establecimiento de los límites máximos especificados?  
El mismo párrafo señala que se otorga trato preferencial en el marco del esquema del SGP siempre que las mercancías cumplan las normas de origen del SGP del Japón.  5. ¿Podría proveer mayor información acerca de las normas de origen que  es necesario cumplir 
para obtener el SGP de Japón? ¿Existe un sitio electrónico donde sea posible encontrar esta 
información?  WT/TPR/M/211/Add.1 
Page 98  
 
  III. POLÍTICAS Y PRÁCTICAS COMERCIALES, POR MEDIDAS 
 2) M
EDIDAS QUE AFECTAN DIRECTAMENTE A LAS IMPORTACIONES  
 i) Procedimientos de despacho de aduana  
 
El párrafo 16 hace referencia a la intención de las autoridades de introducir el Portal Común para la 
Ventanilla Única de Nueva Generación en octubre de  2008, el cual tiene por objetivo unificar las 
formalidades de solicitud por medios electrónicos para los distintos organismos y aumentar  la 
eficiencia al permitir que los organi smos interesados compartan datos. 
 
6. ¿Podría proporcionar mayor información acerca de l funcionamiento del Portal Común para la 
Ventanilla Única de Nueva Generación así como de la reestructuración de procesos que han sido 
necesarias para su implementación?  
7. ¿La implementación del Portal Común para la Ventanilla Única de Nueva Generación se 
apega a la propuesta de Corea que está siendo di scutida en el Grupo de Negociación de Facilitación 
del Comercio?   
ii) Aranceles 
 a) Aranceles consolidados 
 En el párrafo 18 se menciona que Japón posee algunos ti pos arancelarios consolidados que exceden de 
los tipos NMF aplicados, entre otros, de los sigu ientes productos: animales vivos y productos de 
origen animal (sección I del SA), legumbres y ho rtalizas (sección II), preparaciones alimenticias, 
bebidas y tabaco (sección IV), productos de las indus trias químicas (sección VI), materias plásticos y 
caucho (sección VII), textiles y prendas de vestir (sección XI), y metales comunes (sección XV). 
 8. ¿Cuáles son las subpartidas ar ancelarias que poseen esta caract erística, principalmente en qué 
productos agrícolas y de pesca existe un arancel s obre el consolidado, así como en que cantidad 
sobrepasaría dicho consolidado, sobre la base del principio de transparencia establecido en OMC? 
 
b) Aranceles NMF aplicados  
Estructura 
 El párrafo 21 señala que el método de asignación de  los contingentes tiende a ser complejo y no ha 
variado desde el anterior examen del Japón.  9. ¿Podría detallar la manera  en la que opera la asignación de contingentes así como la 
existencia de iniciativas para modificarla?  iii) Medidas no arancelarias en frontera 
 
En el párrafo 30, se hace referencia a que Japón  aplica pocas medidas no arancelarias en frontera y 
que lo que emplea actualmente son prohibiciones y restricciones cuantitativas de las importaciones, 
por ejemplo, con relación a ciertos tipos de pescados en los cuales aplica contingentes de importación. 
 
10. ¿Cuáles son las consideraciones que dicho país utiliza para la aplicación de dichas 
prohibiciones y restricciones cuantitativas y a qué subpa rtidas se aplican los mismos, a fin de que no 
constituyan posiblemente una restricción al comercio  de conformidad con el párrafo 1 del Artículo XI 
del GATT?  WT/TPR/M/211/Add.1 
 Page 99 
 
 
  c) Contingentes de importación 
 El párrafo 33 indica que a más de determinados tipos de pescado, existen productos que están sujetos 
a contingentes de importación.   
11. ¿Cuáles son esos productos y cuál es la nor mativa que fundamenta el establecimiento de 
contingentes de importación?  
vii) Normas, y medidas sanitarias y fitosanitarias 
 a) Normas, pruebas y evaluación de la conformidad 
 
Normas voluntarias 
 
En el párrafo 48 se señala que las  autoridades indi can que alrededor del 53 por  ciento de las JIS son 
comparables a normas internacionales, y que el 96 por ciento se armonizaron con las normas 
internacionales en 2008.  12. ¿Cuál es el fundamento para afirmar que alrededor del 53 por ciento de las JIS son 
comparables a normas internacionales?  
En el párrafo 50 se establece que conformidad con la  Ley JAS, las empresas extranjeras que exportan 
productos agrícolas al Japón pueden obtener la certifi cación ROCB, lo que les autorizaría a realizar su 
propia clasificación y poner en sus productos las marcas JAS.  13. ¿Cuál es el procedimiento que debe segui r una empresa extranjera para obtener la 
certificación ROCB? 
 b) Medidas sanitarias y fitosanitarias  En el párrafo 57 se señala que se ha propuesto una nueva ley que una revisión de los niveles admisibles de cadmio y plomo que migran desde los ar tículos de vidrio, de cerámica o esmaltados, la 
vajilla de mesa y los recipientes destinados a entrar en contacto con los alimentos. 
 14 ¿En relación con los productos de cerámica o es maltados, la vajilla de mesa y los recipientes 
destinados a entrar en contacto con los alimento s, cuáles son los niveles admisibles de cadmio y 
plomo son aceptados en la actualidad? 
 
15. ¿Cuál es el fundamento que tendría esta nue va ley para revisar los niveles admisibles de 
cadmio y plomo en los productos menci onados en la anterior pregunta? 
 El artículo 60 indica que de conformidad con la Le y sobre Condiciones Sanitarias de los Alimentos, 
puede eximirse de la inspección a los cargamentos de alimentos si, en el momento de su importación 
en el Japón, son inspeccionados por una organización oficial de inspección en el país exportador y 
llevan el resultado de la inspección.   Para poder bene ficiarse de dicha exención, tales organismos de 
inspección deben estar registrados en el Gobierno del Japón a través del Gobierno del país exportador.    
 16. ¿Podría proporcionar mayor información acerca del procedimiento y de los requisitos con los 
cuales los organismos oficiales de inspección en el país del país exportador debe cumplir para poder 
obtener este beneficio?  WT/TPR/M/211/Add.1 
Page 100  
 
  c) Prescripciones en materia de etiquetado y envasado 
 El párrafo 62 señala que los el etiquetado de los al imentos está sujeto en el Japón a la Ley JAS y a la 
Ley sobre Condiciones Sanitarias de los Alimentos.    
17. ¿Existe una página web ofic ial de Japón que contenga los re quisitos de etiquetado con los 
cuales deben cumplir los alimentos?  El párrafo 63 indica que todos los vegetales orgáni cos y productos alimenticios orgánicos elaborados 
que se vendan en el Japón deben cumplir las normas JAS pertinentes y llevar la marca JAS 
correspondiente.  En ese sentido, para etiquetar un producto alimenticio como "orgánico" es necesario 
que un organismo de certificación re gistrado o un organismo de cer tificación extranjero registrado 
certifique que el producto cumple determinadas prescripciones JAS.    18. ¿Cuáles son los organismos de certificaci ón registrados con los cuales Japón trabaja? 
 
En el párrafo 64 se hace referencia a que con arre glo a la Ley sobre Condiciones Sanitarias de los 
Alimentos, en las etiquetas de los productos alim enticios elaborados deben indicarse las sustancias 
alergénicas que puedan contener y que actualmente son 25 los producto s designados para su inclusión 
en la descripción de ingredientes: en el caso de 7 de ellos la inclusión es obligatoria (huevos, leche, 
trigo, alforfón, cacahuetes, camarones y cangrejo)  y en el de los otros 18 recomendada (abulón, 
calamar, huevas de salmón, naranjas, kiwi, carne de bovino, nueces, caballa, salmón, gelatina, habas 
de soja, pollo, cerdo, setas de la especie Matsutake,  melocotón (durazno), ñame, manzana y plátano). 
 19. ¿Cuáles son los criterios aplicados por el Japón para considerar la obligatoriedad sólo en los 
primeros 7 productos mencionados y no en los 25 productos que forman parte de la Ley sobre 
Condiciones Sanitarias de los Alimentos? 
 
viii) Medidas de fomento de las importaciones 
 
El párrafo 66 señala que desde el anterior examen de sus políticas comerciales, el Japón no ha establecido ni tiene prevista ninguna nueva medi da de promoción de las importaciones  y el 
presupuesto asignado a esas medidas ha venido descendi endo en los últimos años, lo que implicaría 
que el Japón está insistiendo menos en la promoci ón de las importaciones, que  constituyó uno de los 
principales objetivos de sus políticas comerciales en los años noventa.    20. ¿Podría proporcionar mayor información acerca de los programas promoción de 
importaciones que se están implementando en la actualidad?  
 
4) M
EDIDAS QUE AFECTAN DIRECTAMENTE A LAS EXPORTACIONES  
 i) Tributación y ayudas fiscales  
ii) Subvenciones y otras ayudas financieras  
En el párrafo 81se indica que Japón ha notificado a la OMC diversos programas de subvenciones 
específicas; a saber, 86 programas de subvenciones pa ra ayudar a los sectores de la agricultura, la 
silvicultura y la pesca, la industr ia, las finanzas y el transporte. 
 
21. ¿En qué consisten estos programas, particular mente aquellos relacionados con el área agrícola 
y pesquera?    WT/TPR/M/211/Add.1 
 Page 101 
 
 
  22. ¿Qué acciones se están realizando o se prevé r ealizar a futuro para la eliminación de estos 
regímenes discriminatorios de c onformidad con lo establecido en artículo XVI, Sección B, numerales 
3 y 4 del GATT de 1994?  
v) Reforma normativa 
 
El párrafo 106 indica que en virtud de la Ley de Zonas Especiales de Reforma Estructural, se 
permiten excepciones a determinadas reglamentacion es en "zonas especiales" aprobadas, con arreglo 
a las circunstancias específicas de la zona.  
23. ¿Cuáles son las excepciones a las reglam entaciones aplicables a las “zonas especiales” 
 
IV. POLÍTICAS COMERCIALES, POR SECTORES 
 2) A
GRICULTURA  
 
ii) Evolución de las políticas 
 
El párrafo 11 señala que el derecho de asignación de  contingentes arancelario s exige en ocasiones la 
previa aprobación del MAFF y tiende a complicarse;  puede exigir, por ejemplo, diversas restricciones de uso final y muchos documentos, tal es como cuentas y planes de actividad. 
 
24. ¿Existe alguna iniciativa para simplificar  la asignación de con tingentes arancelarios? 
  
TURKEY
 
 
Report by the WTO Secr etariat (WT/TPR/S/210) 
 
I. Economic Environment (2) Macroeconomic Policies  
 
- Could Japan please explain domestic support it h as provided to various sectors in face of the 
economic crisis if there is any? 
 
II. Trade Policies and Practices by Measure (2 ) Measures Affecting Imports, Table III.4,  
page 47  
 The Secretariat's report includes the table (Table III.4) concerning various standards and technical 
regulations.  As specified at the table, there exis ts a Building Standard Law.  In this respect,  
 - Could Japan explain whether this Law also c onsists of  standards for the importation of 
building materials? If not, is there a separate regulation for this purpose?   III. Trade Policies by Measure (2) Ag riculture, Table IV.2,  page 75 
 
- Could Japan kindly elaborate on the SSG measures in 2009?   WT/TPR/M/211/Add.1 
Page 102  
 
  THAILAND
 
 
WTO Secretariat Report (WT/TPR/S/211) 
 SUMMARY OBSERVATIONS, page xi 
 
(4) T
RADE POLICIES BY SECTOR  
 
Para 28: According to the Secretariat report, Japan h as continued regulatory reform in the services 
sector by, inter alia , enhancing transparency.  One of the exam ples noted in the report is the adoption 
of the "no action letter" system.  Could Japan please provide more information about this system?   
 Para 31:  The Secretariat report observes:  "Japan's medium- and long-term growth prospects will 
depend on its ability to strike a balance between the monetary and fiscal policies in tandem with 
structural reforms.  The latter include reforms ge ared towards reducing the cost of doing business and 
thereby increasing Japan's attractiveness to inward FDI...." 
 We are interested in knowing whether Japan inte nds to attract inward FDI for any sectors in 
particular.  We would also be interested in know ing more about Japan's policies regarding enhancing 
FDI and would appreciate it if Japan could provide mo re information and also direct us to relevant 
websites.    I. ECONOMIC ENVIRONMENT  (3) S
TRUCTURAL POLICIES  
 
(iv) Regulatory Reform 
 
Para 25:   In this paragraph as well as paragraph 6 on page 15, the Secretariat report discusses Japan's 
measures to increase its attractiveness as an investme nt destination for foreig n firms.  Such measures 
include adopting tax measures to facilitate mergers and acquisitions, and provi ding them with national 
treatment.  Could Japan please provide more details on these policies for the benefit of potential Thai 
investors, including regulations concer ning inward FDI and relevant websites? 
 
Additional questions 
 WTO Secretariat Report (WT/TPR/S/211) 
 
SUMMARY OBSERVATIONS, page ix  (3) T
RADE POLICIES AND PRACTICES BY MEASURE  
 
Para 14: According to the Secretariat report, Japan ma intains quantitative import restrictions on some 
fish.  Could Japan kindly clarify the details of the fish and other products that are subject to 
quantitative restrictions, and also provide de tails regarding any quota administration?  
  WT/TPR/M/211/Add.1 
 Page 103 
 
 
  III. TRADE POLICIES AND PRACTICES BY MEASURE 
 (3) S
TRUCTURAL POLICIES  
 (vii) Standards and SPS measures 
 
- Has Japan ever imposed any provisional SPS measures? If so, please provide details 
regarding the products, origin and reasons.   
IV. TRADE POLICIES BY SECTOR 
 
(2) A
GRICULTURE  
 
Rice 
 - Regarding rice subsidies, we note that Japan's most recently notified subsidies were for fiscal 
years 2005 and 2006 (G/AG/N/JPN/132 and 137, circulated on 17/3/2008 and 1/7/2008, respectively), in which Japan notified rice subsidies under both AMS ( de minimis ) and Blue Box.  If possible, could 
Japan please provide updated information on the total am ount of trade distorting subsidies provided to 
rice farmers for fiscal years 2007 and 2008?  
- Could Japan also indicate whether it has ever re-exported rice and rice products imported 
under WTO tariff rate quotas?   
INDONESIA
 
 
WT/TPR/S/211 
 
II. TRADE POLICY REGIME:  FRAMEWORK AND OBJECTIVES 
 
(1) I NTRODUCTION  
 
 The Secretariat Report (paragraph 1, page 15) st ates that "the only major change in Japan's 
government ministries and agencies responsible for the formulation, implementation, and evaluation 
of its trade policies since its previous Trade Polic y Review was the abolition on 28 December 2007 of 
the Cabinet-level Japan Investment Council, and the establishment of the Expert Committee on FDI 
Promotion within the Cabinet Office".  Could the Japanese Government explain the reasons of the abolition of the Cabinet-level Japan Investment  Council, and the establishment of the Expert 
Committee on FDI Promotion within the Cabinet Office?   Are there any effects of these decisions to 
Indonesia particularly the shift of Japanese investment from Indonesia?  
 The Secretariat Report (paragraph 8, page 16) states that "concurrently, Japan has been 
intensifying its pursuit of bilateral/regional arra ngements involving free-trade agreements;  the 
authorities state that this is not just in areas c overed by existing WTO Agreements, but also in areas 
like trade facilitation, investment, movement of na tural persons, competition policy, and improvement 
of the business environment.  The authorities cons ider that Japan's regional and bilateral trade 
arrangements complement the multilateral system, and are useful tools for market liberalization and 
structural reform".  As indicated on this stat ement, the Japanese Govern ment has been actively 
pursuing EPAs negotiations, which reflects its st rategy of increasing leverage for promoting 
multilateral trade liberalization.  Could the Japan ese Government provide more details of the 
guidelines used for choosing EPA negotiating partners ?  In addition, we know that the Japanese WT/TPR/M/211/Add.1 
Page 104  
 
  Government has an EPA with several ASEAN countries.   In this regard, what is the reason that the 
Japanese Government also negotiates an EPA under ASEAN JAPAN EPA?  
(4) T
RADE AGREEMENTS AND ARRANGEMENTS  
 (h) Japan–Indonesia bilateral relationship 
  The Secretariat Report (paragraph 34, page 23) states that "the Agreement between Japan and 
Indonesia for an Economic Partnership (JIEPA), si gned on 20 August 2007, entered into force on 
1  July 2008.  The overall simple average app lied preferential tariff in FY2008 is 3.5%.  Many 
agricultural products and some industrial products  (e.g. rice and rice products, meat and meat 
products, fish and fish products, dairy products, pi neapples, products of milling industry, leather, 
leather products and footwear, and wood products) have been excluded from the agreement.  The 
authorities indicate that the JIEPA eliminates tariffs on some 92% of the total value of bilateral trade, 
based on 2005 data.  Are there any possibility to in clude agricultural products and some industrial 
products into the agreement on the occasion of genera l review of the implementation of JIEPA in the 
fifth calendar year following the entered into force JIEPA, e.g. on 1 July 2013? 
 
III. TRADE POLICIES AND PRACTICES BY MEASURE   (1) I
NTRODUCTION  
 
 The Secretariat Report (paragraph 3, page 32) notes that "Japan has few non-tariff border 
measures.  Those currently applied involve so me import prohibitions and quantitative import 
restrictions (for example, on some fish).  In add ition, imports of some goods are subject to licensing 
requirements to ensure national security, safeguard  consumer health and well-being, or preserve 
domestic plant and animal life and the environment.  Some import prohibitions are in place in 
accordance with United Nations Security Council resoluti ons".  In this matter, we would appreciate to 
have further explanation regarding non-tariff bor der measures applied by the Japanese Government? 
Is that any assistance given to developing coun tries to handle the case of non-tariff barriers? 
 
(2) M EASURES DIRECTLY AFFECTING IMPORTS  
  The Secretariat Report (paragraph 60, page 50) states that "In accordance with the Food 
Sanitation Law, imported food may be exempted fr om inspection upon importation into Japan if a 
cargo is inspected by an official inspection organi zation in the exporting country and bears the result 
of the inspection.  Such inspection bodies must be registered with the Government of Japan, through 
the government of the exporting country, in order to  receive such exemption.  In September 2008, 
3,503 such laboratories were registered with the Go vernment of Japan".  May we have some details 
regarding the mechanism to obtain such exempted inspection?   The Secretariat Report (paragraph 26, page 39) states that "Preferential rates of tariff are offered under the GSP to 141 developing countries a nd 14 territories, including additional preferences 
for 49 least developed countries.  In addition to  the existing preferential access for imports from 
Singapore, Mexico, and Malaysia, under free-trade ag reements (or economic partnership agreements 
(EPAs)), Japan has granted preferential access fo r imports from:  Chile under the JCEPA, since 
September 2007;  Thailand under the JTEPA, si nce November 2007;  Indonesia under the JIEPA, 
since July 2008;  and Brunei under the JBEPA, also since July 2008".   Indonesia wishes to have 
clarification as to whether the Japanese governme nt has had a program to extend this program, 
particularly GSP preferential rates to Indonesia.   The Secretariat Report (paragraph 27, page 39) st ates "the simple average tariff rates under all 
preferential arrangements (GSP, LDC, and the seven EPAs) are lower than the simple average applied  WT/TPR/M/211/Add.1 
 Page 105 
 
 
  MFN rates, although there are wide variations from one product group to another.  In particular, while 
the overall simple average preferential rates range from  0.5% to 4.9%, agriculture is subject to rates 
from 1.8% to 16.0% (Table III.2).  Tariffs unde r these arrangements are also high for certain 
processed and industrial goods, such as leather, rubbe r, footwear and travel goods, and textiles and 
clothing imports (under GSP);  items such as dairy products, some footwear, and textiles and clothing 
are not included in the GSP scheme for developing  countries and are therefore subject to applied 
MFN rates of duty".  Indonesia wishes to have clarification as to whether the Japanese government 
has not included products such as dairy products, so me footwear, and textiles and clothing, in the GSP 
scheme for developing countries.  WT/TPR/G/211 
 
Japan's Trade-Related Assistance Schemes - TRTA 
 
 The Government Report (paragraph 79, page 19) states that "Japan supports this movement, 
especially the exports of developing countries a nd least developed countries through technical 
cooperation such as the dispatch of experts, educational and training programs to create competitive products, and support through internati onal organizations.  In addition, Japan has held exhibitions and 
trade fairs inviting buyers and has also opened shops  (OVOP markets) in Japan's international airports 
in order to introduce products and encourag e shopping".  Under MIDEC cooperation in JIEPA, 
OVOP is included in MIDEC. Related to this matter, what is the implementation progress so far? 
Could the Japanese government expedite the impl ementation of such cooperation in order for 
Indonesia to reap benefit from JIEPA?   
GUATEMALA
 
 
1. En el Informe de Gobierno, Sección 2.1, se señala que el Gobierno ha adoptado reformas 
económicas y fiscales destinadas a estimular el potencial de crecimiento de la economía de Japón y asegurar al pueblo japonés una vida próspera y se gura.  ¿Podría Japón ofrecer mayores detalles 
respecto al contenido y alcance de el "Conjunto glob al de políticas inmediatas: medidas para aplacar 
los temores de la población" y del "Conjunto de políticas económicas: medidas para ayudar a la 
población en su vida cotidiana"? 
 2. En el Informe de Gobierno en la sección 3,  párrafo 13, páginas 6 y 7 Japón expresa que se 
estableció un Comité de Expertos pa ra promoción de la Inversión Ex tranjera Directa (IED).  ¿Podría 
Japón explicar cómo está conformado dicho Comité, cuáles son sus funciones y sí  el mismo aún está 
vigente?  En ese mismo párrafo, se enumeran 5 re comendaciones que dicho Comité realizó para el 
incremento de la IED en Japón en el corto plazo.  ¿Podría Japón explicar cuáles son las acciones concretas que se han diseñado para implementar di chas recomendaciones?  ¿Se ha establecido algún 
sistema para la evaluación de dichas acciones?  3. En el Informe de Gobierno Sección 3.9, Ja pón reconoce que el Programa de Doha para el 
Desarrollo debería contribuir a facilitar la integrac ión de los países en desarrollo en el sistema 
multilateral de comercio mediante una respuesta eficaz a los intereses y preocupaciones de esos 
países.  ¿Considera Japón que una apertura sustancial y real de los mercados agrícolas mundiales de los países industrializados contribuiría a la integr ación de los países en desarrollo en el sistema 
multilateral de comercio? 
 
4. En el Informe de Gobierno, sección 6, 1)  Acuerdos de Libre Comercio y Asociación 
Económica, párrafo 53, página 15 Japón indica que ha fortalecido sus políticas comerciales regionales 
y bilaterales como complemento al sistema multilate ral del comercio, en particular mediante la 
negociación de Acuerdos de Asoc iación Económica que incluyen elem entos de Acuerdos de Libre WT/TPR/M/211/Add.1 
Page 106  
 
  Comercio y Desarrollo Institucional.  Podría Ja pón detallar el contenido de los Acuerdos de 
Asociación Económica, en particular aquellos elemen tos que van más allá de los Acuerdos de Libre 
Comercio?  Asimismo, ¿Podría Japón explicar si en  lo que se refiere a los temas de Libre Comercio, 
éstos acuerdos incluyen las disciplinas tradiciona les de acceso a mercado de bienes, pero también 
otros elementos como servicios, inversión y propied ad intelectual?  ¿Podría Japón indicar cuáles son 
los criterios que utiliza para determinar con qué so cios comerciales emprende  este tipo de Acuerdos? 
 5. En el Informe de Gobierno Sección 8.4, Ja pón detalla que uno de los objetivos de política 
adoptados por el Consejo de Ministros para el s ector agrícola comprende "utilizar plenamente la 
capacidad productiva potencial de la agricultura y desarrollar la agricultura como un sector de 
importancia estratégica para el siglo XXI".  ¿P odría Japón explicar qué medidas concretas se han 
adoptado para la consecución de este objetivo particular? 
 
III)  POLITICAS Y PRÁCTICAS, POR MEDIDAS  
 6. En el informe de la Secretaria, sobre Norm as y medidas sanitarias y fitosanitarias, literal a) 
párrafo 49,  se indica  que "En virtud de la Ley JAS (Ley sobre la normalización y el etiquetado 
correcto de los productos agropecuarios y forestal es), se faculta a organizaciones de terceros a 
certificar a los operadores (por ejemplo, los fabricantes) para que puedan utilizar marcas JAS.".  ¿Podría Japón indicar el procedimiento, requisitos y el plazo para certificar a los operadores o ser un 
organismo certificador, indicando si los plazos y requisitos difieren de nacionales y extranjeros?  
También indicar cuántas solicitudes han sido recibid as y cuántos organismos certificadores han sido 
aprobadas?   
IV) POLÍTICAS COMERCIALES, POR SECTORES 
 
7. En el Informe de la Secretaria, en el numer al 2, Agricultura, inciso iii) Evolución de las 
Políticas, párrafo 11, se indica que: “Se aplican con tingentes arancelarios, que abarcan el 1,8 por 
ciento de todas las líneas arancelarias, principalmen te a productos agropecuarios,  a saber:  arroz, leche 
y productos lácteos (leche en polvo desnatada,  suero, mantequilla, aceite de mantequilla, 
preparaciones de grasa comestible), legumbres de vaina secas, trigo, cebada, cacahuetes, tubérculos de 
konnyaku, almidones, y capullos de seda y seda cruda.
4  El grado de utilización de los contingentes 
arancelarios difiere según el producto (cuadro AIV.1).  Los porcentajes de utilización de los 
contingentes arancelarios son inferiores al 50 por ciento  en el caso de la leche en polvo desnatada, el 
suero preparado para alimentos de lactantes, la mantequilla y el aceite de mantequilla, el suero 
mineral concentrado, los tubérculos de konnyaku  y los capullos de seda y la seda cruda.  La 
administración de los contingentes arancelarios no ha experimentado cambios desde el examen 
anterior.  El derecho a asignación de contingente exige en ocasiones la previa aprobación del MAFF y 
tiende a complicarse;  puede exigir, por ejemplo, diversas restricciones de uso final y muchos documentos, tales como cuentas y planes de activ idad.  ¿Podría Japón indicar las razones por las 
cuales hay subutilización de los contingentes arancelario s y si tiene previsto introducir en el corto 
plazo mejoras al sistema de administración para ga rantizar la plena utilización de los contingentes? 
 
8. A continuación en el párrafo 18, el informe indica que "Desde el anterior examen de sus 
políticas comerciales, el Japón no ha utilizado medidas arancelarias de emergenc ia para los aumentos 
súbitos de las importaciones de carne de vacuno y de  porcino, de conformidad con la Ley de Medidas 
Arancelarias Temporales.
5  Las medidas permiten aumentar los derechos de aduana al nivel 
                                                      
4 Documento G/AG/N/JPN/134 de la OMC, de 28 de marzo de 2008. 
5 Se activaron medidas arancelarias de emergencia, para la carne de vacuno en el ejercicio fiscal 
de 2003 y para la carne de porcino en los ejercicios de 2001 a 2004.  La Ley de Medidas Arancelarias Temporales dispone excepciones temporales a la Ley so bre Aranceles Aduaneros y a la Ley sobre Aduanas, y 
ajustes a los derechos aduaneros con que están gravadas  ciertas mercancías.  Se trata de exenciones de los  WT/TPR/M/211/Add.1 
 Page 107 
 
 
  consolidado en la OMC (el 50 por ciento en el caso de la carne de vacuno) a partir del nivel que el 
Japón redujo unilateralmente más allá de su compromiso  (38,5 por ciento en el caso de la carne de 
vacuno).  ¿Podría Japón listar los productos, a nive l de 9 dígitos del SA, de acuerdo a la Ley de 
Medidas Arancelarias Temporales, las líneas arancelari as que durante el ejercicio 2008 estaban sujetas 
a tipos temporales? 
 
 
                                                                                                                                                                     
derechos de aduanas, derech os de aduana especiales de emergencia, la reducción de los gravámenes aduaneros y 
otros derechos preferenciales (en el contexto, por ejemplo, de los acuerdos de libre comercio y los acuerdos de asociación económica).  En el ejercicio de 2008, 477 líneas (con inclusión de tipos dentro de los contingentes) a 
nivel de 9 dígitos del SA están sujetas a tipos temporales. WT/TPR/M/211/Add.1 
Page 108  
 
  FOLLOW-UP AND ADDITIONAL QUESTIONS 
 
CHINA
 
 
Question 1 
 Information indicates that Japan will implement a "Pet  Food Safety Act" on June 1st, 2009.  The Act 
will set registration requirements for enterprises produci ng pet food to be exported to Japan.  It will 
also set detailed safety and labelling requ irements for pet food. If it is the case, 
 a) Would Japan please provide detailed inform ation on the registration process and other 
requirements? 
 b) Does the Japanese government plan to solic it opinions from interested parties including 
foreign enterprises before the implementation of this new act? 
 c) When does Japan plan to make notifications to the WTO? 
 
Question 2 
 
China would appreciate it if Japan could provide the following information.  
a) Is there any market acce ss requirement on electronic products (including both imported 
products and products produced in Japan) for the purpose of environmental protection? 
 
b) Would Japan please brief us about its implementation of the Basel Convention on the Control 
of Trans-boundary Movements of Hazardous Wastes and Their Disposal ? In this regard, what 
laws, regulations and other administrative me asures have been formulated and enforced? 
 
c) What technical standards have been a dopted respectively in the above two areas? 
  THE EUROPEAN COMMUNITIES
 
 
Additional question  
 
WTO Secretariat's Report (WT/TPR/S/211)  
II. TRADE POLICIES AND PRACTICES BY MEASURE 
 (1) M
EASURES DIRECTLY AFFECTING IMPORTS  
 
(ii) Tariffs 
 WTO Secretariat's Report, page 34  
 
1. As part of its settlement with Canada, the EC, and the US of the Liquor Tax case, Japan has 
commited to apply a tariff of zero from 1 April 2002 for spirits from the EC.  While Japan has 
implemented the zero tariff on a permanent basis for brown spirits, the duty exemption for white 
spiritis is subject to annual renewal.  Could Japan  inform how it intends to deal with the annual 
renewal of duty exemption for white spirits and whet her it is considering to make this duty exemption 
permanent, as is the case for brown spirits?   WT/TPR/M/211/Add.1 
 Page 109 
 
 
  Follow-up questions  
 
WTO Secretariat's Report (WT/TPR/S/211) 
 
III. TRADE POLICIES AND PRACTICES BY MEASURE 
 
(1) M EASURES DIRECTLY AFFECTING IMPORTS  
 (iv) Government procurement 
 
2. With reference to Q35 as previously submitte d by the EC, we find some of the figures which 
Japan has provided in response difficult to understand.   a) Could Japan clarify whether the table fo r Annex 1 entities (central government) includes 
construction services under the heading "Services"? 
 
b) For procurement of Annex 2 entities, the av erage provided appears to fall far below the 
thresholds of the GPA for both architectural services and construction services. 
 3. With reference to Q36, could Japan clarify why the Action Program on Government 
Procurement does not include Annex 2 entities? 
 4. Following-up on Q40 on the operational safety clause:  a) Does the scope of the operational safety clause vary over time?  
 
b) Could Japan provide concrete example of what is covered under "Supplies forming railway 
facilities"? Does that include, for instance, signalling equipment?  
 c) Could Japan clarify what it implies by "Besid es, whether to apply this clause or not should be 
judged by each product or service"? Does it imply that other products or services could fall 
under the scope of the operational safety clause? 
 5. Following-up on Q42, could Japan clarify what is the difference between review procedures 
for Annex 1 and Annex 2?   
6. With reference to Q43, does Japan consid er that the Council on Government Procurement 
Review is an "impartial and in dependent review body with no interest in the outcome of the 
procurement" within the meaning of Article XX (6) of the GPA?  7. Could Japan provide an answer to Q44 of the EC questionnaire?  
8. Regarding the reply to our qu estion nr 17 on the percentage of 'eligible' imports of sensitive 
products actually falling under the ceiling and receive  GSP treatment, the information provided is 
only available in Japanese. Would it be possible to gi ve a short transcript or explain some key figures?  
 
Government of Japan Report  
 9. The EC welcomes the fact that Japan has realized upon its commitment to provide DFQF 
market access for at least 97% of products orig inating from LDCs.  However, we deduct from your 
answer to Q18 that  only some 8%  of LDC imports entered duty-free (Y 62,9 bio compared to total 
LDC imports of Y 789 bio).  We therefore remain interested to learn in what manner and timeframe 
Japan intends to progressively build on  the current 98% to achieve the 100%
 coverage set out in WT/TPR/M/211/Add.1 
Page 110  
 
  Annex F a) i) of the Hong Kong Declaration.  The need to cover all products  is important given the 
concentration of LDC exports on a relatively limite d number of tariff lines.  Furthermore, providing 
meaningful market access to LDCs is particularly acute in the context of the financial and economic 
crisis.  
 
THAILAND
 
 
WTO Secretariat Report (WT/TPR/S/211) 
 
I. ECONOMIC ENVIRONMENT  (3) S
TRUCTURAL POLICIES  
 (iv) Regulatory Reform 
 Thailand thanks Japan for its second-day responses to Thailand' question on tax measures facilitating 
mergers and acquisitions.  Could Japan please provi de more details on the condition of these tax 
measures, especially when compared to the former  tax system mentioned in paragraph 25?  Do the 
new tax measures only apply to businesses, or do they also cover other investments?  II. TRADE POLICY REGIME: FRAMEWORK AND OBJECTIVES  (5) F
OREIGN INVESTMENT REGIME  
 (ii) Investment promotion measures 
 Paragraph 56
 of the Report mentions that in April 2008 Japan issued a recommendation against an 
electronic utilities FDI proposal on the ground of "public order, public security, and national 
security."  Could Japan please provide clarification on what types of activities or businesses could be 
considered to be against the public order, public security, and national security, and also indicate how 
foreign investors can access this information?   
 
Paragraph 59  states that Japan does not have any tax meas ures aimed specifically at FDI promotion.  
What are the incentives or benefits foreign invest ors would enjoy as a result of doing business in 
Japan?  
Paragraph 61
 refers to the Expert Committee on FDI Prom otion that was established in the Cabinet 
Office in January 2008 following the abolishment of the Japan Investment Council.  Is the Expert 
Committee Japan’s investment promot ion agency?  We are also interested in learning more about the 
Expert Committee's Five Recommendations Toward  the Drastic Expansion of Foreign Direct 
Investment in Japan.  In addition to the medical  device industry mentioned in Japan's second-day 
responses to Thailand's FDI questions, could Japan list other priority or target sectors covered by the 
Recommendations? 
 
III. TRADE POLICIES AND PRACTICES BY MEASURE  (2) M
EASURES DIRECTLY AFFECTING IMPORTS  
 
(vi) State trading 
 
Paragraph 46  mentions Japan's current state-trading activiti es, which include rice and other products.    WT/TPR/M/211/Add.1 
 Page 111 
 
 
  - We would appreciate it if Japan could explain the principle, methodology and results of state-
trading activities relating to these products, particularly rice, for the past 3 years. 
 - Which mechanism does Japan utilize to set and stabilize prices of imported products, 
especially rice? 
 
- Does Japan notify the state trading activities and price-stabilizing mechanisms mentioned 
above to the WTO?  If so, please provide references.  
 
III. TRADE POLICIES AND PRACTICES BY MEASURE 
 
(4) M
EASURES AFFECTING PRODUCTION AND TRADE  
 (iv) Intellectual property rights 
 As noted in paragraph 85
 of the Report, Japan has extended the Design Act's maximum term of 
protection from 15 years to 20 years from the date of registration.  Could Japan please provide the 
main reasons for this extension?  Furthermore, because the extension provides more exclusive rights 
for the right holders, how does Japan prevent risk of monopoly?   Paragraph 85
 also mentions that Japan has eased the time limit for multiple patent applications to up 
to 30 days.  Does this time limit apply to appli cations from outside of Japan?  If not, please provide 
information on the time limits for applications from outside of Japan.   Paragraph 90
 of the Report discusses the Act on the Preventi on of Unauthorized Recording of Movies 
in Theatres which was adopted in May 2007.  We would appreciate it if Japan could provide 
information about this measure’s impact on allevi ating the problem of illegal recording in movie 
theatres, e.g., statistics on arrests as well as freque ncy of unauthorized recordi ngs, before and after the 
measure was introduced.  We would also appreciat e it if Japan could provide details on any other 
administrative measures it has enacted to prevent the illegal recording of movies in theatres.  
 
IV. TRADE POLICIES BY SECTOR 
 
(2) A GRICULTURE  
 (i) Overview  
Paragraph 6
 states that Japan introduced new direct  payment assistance to "core farmers" on 
1 April 2007, and that certified farmers may receive  income support based on "historical reference 
amounts."  
 - Could Japan please provide more details on the ope ration of this type of payment assistance?  
We are particularly interested in learning how it operates for rice.   
 
- Does Japan notify this payment to the WTO?  If so, please provide references. Under which 
category of domestic support does this payment fall? 
 
- Could Japan provide examples of how "his torical reference am ounts" are calculated?  
 
Paragraph 20
 discusses Japan's shift away from price s upport schemes to direct payment schemes for 
wheat, sweet potatoes, white potatoes, sugar beets and sugar cane.  WT/TPR/M/211/Add.1 
Page 112  
 
  - Please provide more details about these new payment schemes and how they are 
implemented.  We would also appreciate more  information on the difference between price 
support and direct payment.   
 - Does Japan notify these schemes to the WTO?  If so, please provide references.  Under which 
category of domestic support do these schemes fall?  
 - Will the transformation of price support to direct  payment schemes affect domestic prices and 
the importation of sugar and flour into Japan?  How so? 
 
 
THE UNITED STATES
 
 
Q A2-3:  While it is mentioned in Japan's response to  Q2-2 that "Japan does not believe they provide 
the same services in the same market as of this moment" with respect to EMS and international 
express carrier services, how does Jap an justify that view in light of a report by Japan's competition 
policy authority, the Japan Fair Trade Commission , in April 2006 on the competitive relationship 
between postal express services and private express services?  That report found many similarities in the services and analyzed the international expr ess market as one that includes EMS and private 
services alike (a conclusion that was similarly drawn with respect to Japan Post's and private domestic 
express services)? 
 
Q-6:  Japan says that it is of the view that many Members involved in RTA negotiations are "under 
the general assumption" that duty elimination needs to cover at least 90% of trad e between the Parties.  
However, Japan has not indicated any source, nor ar e we aware of, any such "general assumption" in 
RTA negotiations concerning the requirement unde r GATT Article XXIV that tariffs are to be 
"eliminated on substantiall y all the trade."  Nor do we see the relevance of the alleged "at least 90%" 
threshold, given that Japan has failed to pledge to el iminate even 90% in all of its agreements.  In any 
event, however, the United States does not concur that 90% duty elimination per se satisfies the 
Article XXIV requirement.  Indeed, we find it difficu lt to believe that a plain reading of the term 
"substantially all trade" permits anything less than virtually total elimination of all tariffs, and not 
simply 90%.   
 
In light of this reading of the "substantially all trade" requirement in Article XXIV and according to 
the WTO Secretariat’s Factual Presentation of the Japan-Mexico EPA (WT/REG198/4), it would 
appear that Japan's unwillingness to liberalize as much  as its developing country partner Mexico calls 
into question the consistency of that agreemen t with GATT Article XXIV.  Does Japan envision 
taking steps to eliminate duties on more products w ith a view to bringing this agreement under the 
terms of GATT Article XXIV?  Q 9-2:  Japan stated in its respon se to Q9-2, that 86 of 100 IAAs are covered by the GPA, and in its 
response to Q9-4 that 50 IAAs had been added to  Annex 3 of the GPA.  Were the other 36 IAAs 
added to another Annex of the GPA?  If not, pl ease explain how they are covered by the GPA? 
 
Q 9-5(2):  Does the Ministry of Land, Infrastruct ure, Transport and Tourism (MLIT) review each 
proposed use of Note 4(a) ("procurement related to  operational safety of transportation") by Annex 3 
entities?  Given Japan's report of the extensive use of the comparable Note 5 by Annex 2 entities, does 
MLIT intend to engage in a more diligent review of the use of the Note by Annexes 2 and 3 entities 
and to undertake efforts to reduce its use? 
 Q10:  In its response to Q10, Japan states that the Japan Aerospace Exploration Agency (JAXA) has 
assumed the functions of the National Aerospace  Laboratory (NAL), and asserts without any 
discussion that the withdrawal of NAL would have  “negligibly-small” effect on coverage.  Please  WT/TPR/M/211/Add.1 
 Page 113 
 
 
  describe the NAL functions that were assumed by J AXA, and the basis for Japan's assertion that they 
would have a negligible effect on mutually agreed coverage.  Q11 and Q14-2:  In responses to both Q11 and Q 14-2, which asked for descriptions of "competitive 
bidding methods" and "open tendering", Japan only re ferred to its Accounts La w.  The United States 
again repeats its request for a description of these procurement methods, including the qualification 
requirements for participation in these tendering procedures.   Q 16-2:  Why were construction, architectural, e ngineering and other technical services excluded from 
the extension of the tendering period?  
 
Q16-3:  From Japan's response to Q16-3 ("The uni fied qualifications are applied to open tendering 
and designated bidding for the manufacturing and sale of products."), is it correct to understand that 
the same qualifications requirements are applied to both open tendering and designated bidding? 
 
Q A23:  Please provide further information on the a pparent inconsistency in Japan's approach to the 
use of ex officio  authority with regard to copyrights as it appears, from Japan’s answer to Q23, that 
ex officio  authority is only applied to tr ademark and patent infringement?  
 Q A32:  In Japan's answer to Q32, it states that Japan Post Insura nce was "privatized" in 
October 2007, when Japan Post Holdings took ownershi p of the entity.  Is it true that Japan Post 
Holdings is fully owned by the Government of Japan?   If so, how is this situ ation consistent with the 
statement that the transfer of Japan Post Insurance to ownershi p by Japan Post Holdings was a 
"privatization"?  Q A33:  Given the apparent inconsistency, as d escribed in Japan's answer to Q33, between the 
treatment of foreign insurance companies incorporated  in Japan and the treatment of foreign insurance 
companies that operate in Japan w ith sub-branches, is there any plan to update the relevant laws to 
address this?  The United States wishes to thank Japan for the an swers provided regarding agriculture and matters 
related to the Agreement on the Application of Sa nitary and Phytosanitary (SPS) measures and would 
appreciate further clarification regarding several responses.  
 SPS Q1:  Organics:    With regard to Japan's organics program, the govern ment states that Japan "prohibits using seeds, 
seedlings, manure, fertilizer or other agricultural ma terials modified using DNA technology," but it is 
not clear how this policy ensures compliance with  guidance from CODEX that "organic agriculture 
practices cannot ensure that products are completely  free of residues, due to general environmental 
pollution."  Last week, the United States provided Japan with a legal clarification from CODEX at 
Japan’s request explaining that th ere are "no specific residues of pesticides or any other substance in 
organic products" covered by the international or ganic guidelines.  Please explain how Japan's zero 
tolerance policy for transgenic organisms complies with Codex Guidelines in light of this guidance 
from CODEX?  Further, please explain how often domestic products are tested and how Japanese regulatory agencies ensure that organic products pr oduced in Japan are completely free of residues 
despite environmental pollution?  
SPS Q2:  MRL Enforcement Program: 
 Article II of the SPS Agreement states that Members have a right "to take SPS measures necessary for 
the protection of human, animal or plant life or heal th," that "measures are applied only to the extent 
necessary," "based on scientific principles and cannot  be "maintained without sufficient scientific WT/TPR/M/211/Add.1 
Page 114  
 
  evidence."  In light of this, can Japan please expl ain how it justifies its stringent policy regarding 
enforcement of maximum residue levels which pe nalizes an entire industry in an exporting country 
due to a violation incurred by a single supplier from that country?  Second, could Japan please explain how it justifies its  enforcement regime in light of Article 5.6 of 
the Agreement?   
 In Japan's response to Question 18-3, the governme nt acknowledges that domestic violations are not 
subject to the same inspection systems as for im port foods and that control measures follow Japan 
MRL policy and laws.  How does Japan justify its policy of subjecting domestic and imported 
horticultural products to different rules in light of  Article 2.3 of the SPS Agreement?  (Article 2.3 
states that "Members shall ensure that their SPS measures do not arbitrarily or unjustifiably discriminate between Members where identical or si milar conditions prevail, including between their 
own territory and that of other Members.")  Fina lly, violations by importers are immediately posted 
on MHLW's website.  Please provide the informatio n on the number of domestic pesticide tolerance 
violations that have occurred since January 20 06 under your enforcement program and why MHLW 
does not publish these violations  in a consolidated list as it does in the case of imports?  
 SPS Q3.  Post Harvest Fungicides:   The United States wishes to thank Japan for its explanation of specific provisions of the Food 
Sanitation law.  The law requires two risk assessments  for the same product.  In light of Article V of 
the SPS Agreement, how does Japan justify this requi rement and the requirement that each assessment 
be conducted by different ministries in Japan?    WT/TPR/M/211/Add.1 
 Page 115 
 
 
  REPLIES PROVIDED BY JAPAN 
 BRAZIL
 
 Q1. Brazil takes note of Japan's statement in document WT/TPR/G/211 that Regional Trade 
Agreements will serve as building blocks to reach higher trade liberalization at the multilateral level 
and that, in doing so, Japan will take into consid eration their possible influences on the WTO system 
and the world economy (para. 5-6).  In that contex t, what are the specific initiatives Japan foresees for 
the near future in the Latin American regi on, in particular with Mercosur countries? 
 
A. Japan signed a bilateral investment treaty with  Peru in November, 20 08.  Japan is currently 
considering the possibility of an EPA with Peru.   Japan concurred with Colombia in November 2008 t hat the two countries would launch negotiations 
for concluding a bilateral investment treaty. 
 
Q2. Concerning Agriculture in the Doha Deve lopment Agenda, Japan states in document 
WT/TPR/G/211 that difference in tariff structur es, the multifunctionality of agriculture, and food 
security are taken into account (para.20). In what measure those factors could influence a successful 
outcome of the negotiations that are intended to bri ng liberalization for trade in agricultural products? 
 
A. Japan, as the world largest net food import er of agricultural produc ts, has constructively 
committed to the DDA agriculture negotiations, call ing for a balanced outcome which is acceptable 
for all Members.  Such an outcome should take account  of the differences in tariff structure among the 
Members and the importance of the multi-functiona lity of agriculture and food security, in line with 
the guiding principle, "the coexistence of various  types of agriculture."  As the global food crisis 
deepens, we believe that Japan’s argument that agr iculture is the foundation of society and should be 
maintained and developed, not only in competitive ex port countries, but in all countries, is becoming 
more and more relevant and legitimate. 
 
Q3. The Report by the Secretariat (document WT/TPR/S/211) indicates that approximately 99% 
of tariff lines are bound and that non-ad valorem duti es represent 6.7% of all tariff lines.  What are 
Japan's intentions towards binding the totality of its tariff lines, as we ll as to fully express them in ad 
valorem terms, with a view to offering more tran sparency and predictability to trading partners? 
 
A. Some tariff lines are not bound, and non-ad valorem duties are applied to certain items. 
Unbound tariffs and non-ad valorem tariffs in Japan's tariff schedule are consistent with WTO 
Agreements.  As explained in the Report by the Secretariat (para 2, page 32), Japan's ta riff schedule has a high 
degree of predictability.  
Japan will continue to engage in discussion in th e WTO in a constructive manner and set appropriate 
types and levels of tariffs, while considering the progress and results of DDA negotiations.  
 
Q4. In document WT/TPR/G/211, Japan indicates that it has implemented since April 2007 duty-free and quota-free market access for approxima tely 98% of products originating in least 
developed countries (para74).  What are Japan's inte ntions, if any, to exte nd the product coverage to 
100%, and in what timeframe?  
A. Since 1 April 2007, Japan has expanded duty-free and quota-free (DFQF) market access to 
the Least-Developed countries (LDCs), covering appr oximately 98% of all tariff lines, thereby 
realizing its commitment to provide DFQF mark et access for at least 97 percent of products WT/TPR/M/211/Add.1 
Page 116  
 
  originating from LDCs, as stated in the WTO Hong Kong Ministerial Declaration. (See 
WT/COMTD/N/2/Add.14 for detail)  Japan will continue to apply its ta riffs in an appropriate manner. 
 
 
CHINA
 
 
Q1. Would the Delegation of Japan please share w ith us the latest statistics regarding Japan’s 
economic growth rate of 2008?  What is the forecast for 2009? 
 
A. The GDP growth rate at constant prices (r eal GDP growth) in FY2008 is estimated to be 
around negative 0.8%;  the GDP growth rate at cu rrent prices (nominal GDP growth) is forecast to 
be around negative 1.3%.  In FY2009, the real GDP gr owth rate is expected to be around 0.0%;  the 
nominal GDP growth rate is projected to be around 0.1%.    
The real GDP growth rate for FY2008 (actual figures)  is set to be announ ced around mid-May 2009. 
Please refer to "Fiscal 2009 Economic Outl ook and Basic Stance for Economic and Fiscal 
Management".  (Cabinet decision on January 19, 2009). 
Note:  The Fiscal Year in Japan spans from April to next March.  
Q2. Japan established the Expert Committee on FD I Promotion within the Cabinet Office to 
replace Japan Investment Council, whic h was abolished on 28 December 2007. 
 
Would the Delegation of Japan please elaborate th e organizational structur e and function of the 
Expert Committee on FDI Promotion?   
A. The Expert Committee on FDI Promoti on, composed of academics, Japanese and 
non-Japanese businesspersons etc., is an advisory body  for the Minister of State for Economics and 
Fiscal Policy.  The Expert Co mmittee was established in January 2008 and its main functions are 
gathering information for improving Japan’s inve stment environment for foreign capital and 
examining government policies related to the prom otion of investments.  The Expert Committee 
published "Five Recommendations Towa rd the Drastic Expansion of Foreign Direct Investment in 
Japan" in May 2008.  The Recommendations are available at:  http://www5.cao.go.jp/invest-
japan/index.html. 
 
Appendix 
 Members of the Expert Committee for FDI Promotion  (Chair) Haruo Shimada  President, Chiba University of Commerce  
Chairman, Fujitsu Research Institute  
 Mitsue Aizawa  Attorney-at-Law, Bingham McCutchen Murase, Sakai Mimura Aizawa –Foreign  Law Joint Enterprise  
 
Allan D. Smith  
President, American Chamber of Commerce in Japan   Takatoshi Ito  Professor, Faculty of Economics and Graduate School of Public Policy, University of Tokyo  
  WT/TPR/M/211/Add.1 
 Page 117 
 
 
  Shujiro URATA  
Professor, Graduate School of Asia-Pacific Studies, Waseda University   Toshiko Oka  Chief Executive Officer, Abeam M&A Consulting Ltd.  
 
YAN Hao  President and CEO, EPS Co., Ltd.   Masaharu Shibata,  
Chairman, NGK Insulators, Ltd.  
 Uichiro Niwa,  Chairman of the Board, Itochu Corporation   
Yasuo Hayashi  
Chairman and CEO, Japan External Trade Organization   Shigeki Morinobu Professor, Chuo Law School   
Tetsuzo Yamamoto  
Professor, School of Comm erce, Waseda University  
 Richard Collasse  Chairman, European Business Council in Japan  
 
Robert Alan Feldman  Managing Director, Morgan Stanley Japan Securities Co., Ltd. 
 
Q3. The Secretariat Report notes that "Since Ma rch 2007, administrative organs have been 
required to conduct ex-ante evaluation of regulations". 
 
Would the delegation of Japan please elaborate th e mechanism and procedure for this  "ex-ante 
evaluation"?  
A. In March 2007, the Government of Japan am ended the "Cabinet Order for Enforcement of 
the Government Policy Evaluations Act," to legally  obligate each administrative organ to conduct an 
ex-ante evaluation of the regulations they intend to in troduce, abolish or change if the regulations are 
based on laws or cabinet orders pursuant to laws created after 1 October 2007.  For regulations not 
subject to the compulsory application of ex-ante eva luation, the "Basic Guidelines for Implementing 
Policy Evaluation" prescribes that each administrative organ shall make efforts to conduct ex-ante evaluation proactively on a voluntary basis. 
 
In August 2007, the Ministry of Internal Affairs and Communications (MIC) drew up  "Implementation Guidelines for ex-ante Evaluation of Regulations" that pr ovides standard guidance 
on the type of analysis that should be conducted,  what procedures are necessary and other related 
matters to the ex-ante evaluation of regulations, in order to ensure smooth and efficient 
implementation.  The reported items of evaluati on reports and the deadline for the publication of 
evaluation reports, etc., are identified in the "Imp lementation Guidelines for ex-ante Evaluation of 
Regulations". WT/TPR/M/211/Add.1 
Page 118  
 
  (Reported Items) 
1. Purpose, contents and necessity of the regulation 2. Analysis of costs and benefits 3. Analysis of cost-benefit relationship 4. Comparison with alternatives 
5. View of experts and other related matters 
6. Time or Condition for reviews  (Publication)  
If a regulation is enacted, revised or abolished by  law, an evaluation report, etc., shall be made 
public no later than the Cabinet's approval of the dra ft law.  If it is enacted, revised or abolished by a 
cabinet order, or ordinance equivalent or inferior to a cabinet order, an evaluation report, etc. shall 
be made public no later than the commen cement of public hearing procedures. 
 
For more information on the "Implementation Gu idelines for ex-ante Evaluation of Regulations," 
please refer to the following URL.  http://www. soumu.go.jp/hyouka/seisaku_n/pes/implementation.pdf 
 
Q4. Would the Delegation of Japan please explain how it can ensure equal treatment to domestic and imported agricultural products in the inspection procedures, given that they are inspected by 
different government agencies, where different insp ection methods and approaches might be adopted?  
 
A. With regards to inspection methods and approaches in both domestic and imported 
agricultural products, they are based on "The Guid eline for Implementation of the Monitoring and 
Guidance under the Food Sanitation Law (Ministry of Health, Labour and Welfare Public Notice 
No. 301, 2003)".  
 
Therefore, local and central governments inspect a ccording to the same inspection methods and 
approaches provided for in the said guideline under the Food Sanitation Law.  
 
Q5. Japan committed to open its maritime aux iliary services in its GATS Schedule, yet foreign 
shipping companies are not allowed to conduct port op erations directly.  Instead, they are required to 
register a company in Japan to conduct port transaction business.  
This requirement creates unnecessary burden and extra operation costs to foreign shipping companies.  
 Q5a. Would the Delegation of Japan please explain the rationale for this requirement?   A. If shipping companies acquire permission through the Port Transport Business Law to 
operate port transport businesses, they can op erate port transport businesses in Japan. 
 
Q5b. Does Japan have the plan to consider removi ng or modifying this requirement with a view to 
facilitating trade?  A. Please see the answer to Q5a. 
 
 
MEXICO
 
 Q1. It is stated in paragraph 31 that Japan submitted its revised conditional offer in services on 
24 June 2005.  In this connection, Mexico would like to know whether Japan plans to eliminate the 
MFN exemptions granted for maritime services, cab otage services, international freight forwarding 
and international shipping services.   WT/TPR/M/211/Add.1 
 Page 119 
 
 
  A. The right of maritime cabotage has been estab lished internationally from the viewpoint of 
sovereignty and national security of individual countries.   As with many maritime nations, Japan has 
restricted maritime cabotage to Japanese vessels bas ed on the Ship Law and has no plan to relax the 
regulation.  
With regard to international shipping services,  Japan maintains MFN exemption because Japanese 
shipping companies suffered unreasonable loss due to  a unilateral sanction in the past and there still 
remains the risk of such a unilateral sanction.  Consequently, the possibility of withdrawing MFN 
exemption depends on the outcome of this round of negotiations. 
 
The reason why Japan has listed the international freight forwarding services in its MFN exemption 
list is to ensure fair business activities in this s ector that has a variety of regulations in foreign 
countries and to grant operation permission or  registration on a reciprocity principle.  
 With regard to MFN exemption, the treatment of this measure will depend on the outcome of this 
round of negotiations.  
Q2. In paragraph 37, it is stated that the centre piece legislation governing the operation of banks is 
the Banking Law, which stipulates that a licence is  required to operate a bank in Japan.  After 
obtaining a licence, foreign banks may enter the Japanese market by establishing branches or 
subsidiaries.  Mexico would like to know what th e requirements are for obtaining a licence to operate 
a foreign bank in Japan. 
 
A. The Banking Act provides licensing requiremen ts for banks for prudential reasons. Article 4 
provides licensing requirements for banks incorporated  in Japan, including subsidiaries of foreign 
banks. Article 47 provides licensing requirements fo r foreign banks' branches. Both articles provide 
that, in issuing banking licenses, the Financial Services Agency shall examine (1) whether the 
applicant has adequate financial capa city to carry out sound and e fficient banking business, and the 
prospective income and expenses of its business opera tions will be satisfactory, (2) whether the 
applicant, in respect of its personnel composition, etc., has the relevant knowledge and experience to 
carry out banking business appropriately, fairly  and efficiently, and possesses adequate social 
credibility. 
 
Q3. Paragraph 52 refers to the fact that the highe r growth of total factor productivity (TFP) in the 
"information and communications" sector may be attributed to the recent liberalization of Japan's telecom sector, which intensified competition.  N onetheless, the Japan Fair Trade Commission (JFTC) 
maintains that the Japanese market for fixed and mobile telecom services is characterized by 
"monopolistic situations" (oligopolistic) as defi ned in paragraph 7, Article 2 of the 
Anti-Monopoly Act.  Mexico would like to know what  form was taken by the recent liberalization of 
the sector referred to.  
A. Japan released the New Competition Promo tion Program 2010 in September 2006 as a 
specific action plan to develop an environment for fair competition in the broadband market by 2010, 
and has begun addressing the interconnection charge  calculation method for fixed telephony, the 
system of designated telecommunication facilities, a nd other relevant competition rules to ensure fair 
competition.  Japan has been applying the results from such reviews and steadily promoting the 
liberalization of the telecommunication field. Th e following is the relevant press release URL: 
Revision to New Competition Promotion Program 2010 and Release of New Competition Promotion 
Program 2010 Progress Report (Primary). 
http://www.soumu.go.jp/joho_tsusin/eng/Rele ases/Telecommunications/news071023_2.html 
 With respect to mobile telephony, a new system  for number portability was introduced in 
October 2006 and the competition is becoming much more active than before.  WT/TPR/M/211/Add.1 
Page 120  
 
  Up to this point, the Japan Fair Trade Commi ssion has never expressed its views that fixed and 
mobile telecommunication businesses meet all the co nditions of "monopolistic situations" defined in 
the Anti-monopoly Act. 
 
Q4. According to paragraph 60, the authorities ma intain that there are no discriminatory measures 
affecting foreign participation in international maritime services and that Japan's bilateral agreements 
on passenger or cargo shipping provide national treatment  to partners on a reciprocal basis.  Japan 
would like to know what are the differences in the requirements applicable to a foreign company 
providing international maritime transport services under a bilateral agreement and outside such an 
agreement. 
 
A. As shown in the revised offer by Japan,  there are no discriminatory measures affecting 
foreign participation in international maritime services.  With regard to cabotage, the right to access cabotage can be granted exceptionally from the 
viewpoint of national security and through agreem ents between Japan and other requesting or 
requested countries. 
 
Q5. In paragraph 134, it is stated that there are no restrictions on foreigners wanting to operate 
ports or provide auxiliary port services, such as pilotage, towing, cargo ha ndling and warehousing. 
Mexico wishes to know what are the requirements under which foreign companies may provide such 
services. 
 
A. With regard to towing services, there are no discriminatory restrictions on foreign service 
providers.  
In addition, pilotage services and towing services are available to international maritime transport 
suppliers on reasonable and nondiscriminatory terms and conditions.  If companies get permission by the Port Transport Business Law to operate port transport business, 
they can operate port transport business in Japan.  
Warehousing service providers must be registered with the Minister of Land, Infrastructure, 
Transport and Tourism in Japan. 
 
Q6. It is stated in paragraph 75 that, in addition to obtaining relevant licences, membership  of a 
professional association  is compulsory for:  certified public accountants, administrative scriveners, 
lawyers, judicial scriveners, land and house survey ors, licensed tax accountants, public consultants on 
social and labour insurance, and patent attorneys.   Mexico wishes to know whether these requirements 
apply equally to fo reign professionals. 
 
A. Any person with qualifications to b ecome: a certified public accountant / certified 
administrative procedures specialist / registered fo reign lawyer / judicial scrivener / land and house 
surveyor / certified public tax accountant / public cons ultant on social and labor insurance or patent 
attorney is required to register with a relevant  professional association before starting his/her 
business as a specialist.  This requirement also applies to those from other countries in accordance 
with relevant law.   
 Q7. Paragraph 77 refers to the fact that foreign participation in the sector is regulated by the 
Practising Attorney Law and the Act on Special Me asures concerning the Handling of Legal Services 
by Foreign Lawyers.  Under the law, a "registere d foreign lawyer" (a foreign lawyer qualified under 
Japanese law) can employ a Bengoshi (a lawyer qua lified under Japanese law) and a joint enterprise  WT/TPR/M/211/Add.1 
 Page 121 
 
 
  involving the two is allowed.  Mexico would like to  know what are the requirements for a lawyer to 
obtain qualification under Japanese legislation.  
A. The conditions to be qualified as a "Bengoshi" are as follows*: 
(I) The applicant must pass the national bar exa mination run by the Government of Japan, 
(II) The applicant must complete the le gal apprentice training course, and  
(III) The applicant must be registered  in the roster of attorneys of the Japan Federation of Bar 
Associations (Nihon Bengoshi Rengo-kai). *Any person specified below will not be qualified to be a "Bengoshi": 
 (i) Any person who has been sentenced  to imprisonment or other more severe 
punishment; 
 (ii) Any person who has received a judicial decision of dismissal from the Court of 
Impeachment; 
 (iii) Any person who has not gone three yea rs since he/she has received any of the 
following measures through disciplinary action: 
  - disbarment as a "Bengoshi" or  as a "registered foreign lawyer," 
  - prohibition from practicing as a patent attorney,   - revocation of his/her registration as a certified public accountant,    -prohibition from practicing business as a licensed tax accountant, or   - dismissal from his/her office as a public servant  (iv) Any person who has been subject to an order for commencement of guardianship of 
an adult ward or curatorship; or 
 (v) Any person who has been declared bankr upt and has not had his/her rights restored. 
 To become a registered foreign lawyer, a foreign la wyer must be recognized by the Minister of Justice 
as a registered foreign lawyer* and register with  the Japan Federation of Bar Associations. 
*The conditions for granting recognition by the Minister of Justice are as follows: 
 (i) The service supplier is qualified as a lawyer in the jurisdiction. 
 (ii) The service supplier has engaged himself as a lawyer for at least 3 years in the 
jurisdiction. 
 (iii) The service supplier is not subject to  such conditions of disqualification in the 
jurisdiction which, if applied to Beng oshi, would disqualify the Bengoshi. 
 (iv) The service supplier possesses the intention to undertake the profession in good faith. 
 (v) The service supplier po ssesses plans, residence and a financial basis to perform his 
functions properly and steadily. 
 (vi) The service supplier possesses the capability to compen sate for damages caused to 
the client, if any. 
 
Q8. Paragraph 79 states that, with a view to f acilitating the movement of natural persons, Japan 
has a list of eight trading partners (China, Ch inese Taipei, the Republic of Korea, Malaysia, 
Myanmar, the Philippines, Singapore and Viet Na m) whose examinations or qualifications of 
IT engineers are recognized by the Japanese Immigra tion as eligibility criteria to obtain the residence 
status of "engineer".  Mexico wishes to know whet her Japan plans to include more countries in this 
list of trading partners. 
 
A. The Revised Three-Year Plan for the Promo tion of Regulatory Reform (approved in the 
Cabinet meeting held on March 25, 2008) states th at the Government of Japan will review the system 
relating to the acceptance of foreign nationals, including the criteria for landing permission for IT 
engineers, and will continue to take necessary measu res.  In the future, the list will be expanded to 
include foreign examinations and qualifications mut ually certified in Japan and designated by the 
Minister of Justice in the Official Gazette  based on the result of mutual certification. 
 
 WT/TPR/M/211/Add.1 
Page 122  
 
  SWITZERLAND
 
 
Q1,2,3,4. In para. 10, the Secretariat's report indi cates that Japan's three fiscal objectives announced in 
its "Direction and Strategy" in January 2007 are:  1) to achieve a primary balance surplus of the 
combined central and local governments by FY2011;  2) to stabilize the government debt-to-GDP 
ratio before reducing it in the mid-2010s and 3) to cu rb expansion of the civil service. In view of the 
substantial economic downturn that Japan is curre ntly facing, could the Japanese authorities indicate 
whether they consider that the first two of th ese objectives are still valid?  How do they intend to 
reconcile these objectives with th e present need to stabilize the economy?  In this respect, what 
measures, if any, are being considered by the au thorities to stabilize the economy in the short-term?  
Also, in a longer term perspective, do the Japanese  authorities not consider that a more aggressive 
reduction of the debt-to-GDP ratio would be warran ted than the one foreseen in the "Direction and 
Strategy", given that the extremely high current debt-to-GDP ratio of 170% is likely to further 
increase in the short run as a result of the recession?   
Q1. In view of the substantial economic downtur n that Japan is currently facing, could the 
Japanese authorities indicate whether they consider th at the first two of these objectives are still valid? 
 
A. The Japanese economy and tax revenue are declining at an unexpectedly-rapid rate as a 
result of the global financial crisis and economic deteri oration.  The target of achieving a primary 
balance surplus for the central and local governme nts by FY2011 now appears difficult to achieve. 
 The target is a milestone toward "fiscal consolidatio n."  It remains necessary to achieve this target as 
soon as possible while flexibly responding to unprecedented and uncertain economic conditions 
inside and outside Japan.  While it is  difficult to accurately predict the future economic situation amid 
such fluid and unclear conditions , Japan will make efforts to restore its fiscal health, placing top 
priority on economic recovery.  Furthermore, the target continues to be extremely important to ensu re prevention of a surge of public 
debt (the ratio of debt of the central and local government to GDP) as well as the steady reduction of 
that debt. Japan will carry out disciplined economic and fiscal management with an aim to achieve 
this important target by the mid-2010s.   
Q2. How do they intend to reconcile these objec tives with the present need to stabilize the 
economy?  A. Japan will implement decisive economic  and fiscal management through a fundamental 
stance that entails being bold over the short-term  and responsible over the medium-term.  In the 
short-term, Japan will steadily implement ec onomic recovery measures totaling as much as 
¥75 trillion.  At the same time, the government will implement a fundamental reform of the tax system, 
specifically, in accordance with the "Mid-term Program" (Cabinet decision on December 24, 2008). 
 
Through all of this, Japan will strive to estab lish a mid-term framework of responsible public 
finances, strengthen the reliability of the soci al security system and enhance international 
competitiveness.  Based on th ese measures, a sustained expansi on in domestic demand will be 
achieved. 
 Q3. What measures, if any, are being considered  by the authorities to stabilize the economy in the 
short term?   
A.  Japan has already formulated three econom ic policy packages and implemented parts of 
these packages. 
  WT/TPR/M/211/Add.1 
 Page 123 
 
 
  "Immediate Policy Package to Safeguard People's Daily Lives" 
http://www5.cao.go.jp/keizai1/2008/081224summary-english.pdf  "Economic Policy Package: Measures to Support People's Daily Lives" http://www5.cao.go.jp/keizai1/2008/081201outline-english.pdf 
 
"Comprehensive Immediate Policy Pack age – Easing Public Anxiety" 
http://www5.cao.go.jp/keizai1/2 008/0918summary-english.pdf 
 
Q4. Do the Japanese authorities not consider that a more aggressive reduction of the debt-to-GDP 
ratio would be warranted than the one foreseen in  the "Direction and Strategy", given that the 
extremely high current debt-to-GDP ratio of 170% is  likely to further increase in the short run as a 
result of the recession?  
A.  Government debt is expected to reach about 150.4% of the GDP in FY2009.  The Japanese 
fiscal situation is one of the most severe among leading advanced countries and the burden of this 
situation is currently being pushed on to future generations.   In light of this, ensuring the prevention of a surge of the ratio of central and regional governmental 
debt to the GDP, and the stable reduction of said ratio in order to secure fiscal sustainability, are two 
extremely important goals.  Japan will carry out disciplined economic and fiscal management with 
the aim to restore fiscal health by the mid-2010s.   
Q5. In para. 19, the Secretariat's report indicat es that the structure of the certified public 
accountant examination, as well as increasing the frequency of the examination (twice a year) is to be 
changed so as to make the profession more accessibl e, and encouraging and facilitating the hiring of 
foreign financial experts.  Could the Japanese au thorities elaborate on how the hiring of foreign 
financial experts has been facilitated?  Do they need  to pass an examination?  Is Japan considering to 
accept a proof of professional experience as sufficient?  
A. Japan has been encouraging and facilitating the hiring of foreign financial experts by not 
establishing any limitations in terms of qualifications and examination systems.   
Japan is responding to the issue of "foreign financia l experts" as the question applies to certified 
public accountants.    In Japan, providing accounting-related services,  which includes compiling financial documents and 
consulting services relating to finance (but not incl uding attestation of financial statements), are 
permitted for those who do not have Japanese CPA qua lifications.  There are a number of persons 
who provide such accounting services in Japan. In  addition, the 2007 amendments to the CPA Act 
enabled such persons to become partners of audit firms, provided that certain conditions are met.  
 In order to conduct audits of financial statements in Japan, the CPA Act requires persons to (i) pass 
the Japanese CPA examination, (ii)complete the prac tical training course, and (iii) have worked in 
audit-related services for a certain number of years.  The FSA permits the experience of working in 
audit-related services in foreign jurisdictions to be  valid in calculating candidates' experience. 
 
Q6-1,6-2. In para. 15, the Secretariat's report s uggests that all laws, regulations, and rules are 
published in the Government Gazette .  The Government makes availabl e all laws, Cabinet orders, and 
ministerial ordinances on the Internet; however, various Cabinet decisions  and "understandings" are 
not available.  Could the Japanese authorities explain, first, the nature of these Cabinet decisions and 
"understandings" as well as the difference of these with Cabinet orders and,  second, the reasons for 
applying a lesser degree of transparency to Cabi net decisions and "understa ndings" than to Cabinet 
orders, and ministerial ordinances? WT/TPR/M/211/Add.1 
Page 124  
 
  Q6-1. Could the Japanese authorities explain… the nature of these Cabinet decisions and 
"understandings" as well as the difference of these with Cabinet orders  
A. Cabinet "decisions" are made on issues that  require decisions by the cabinet in accordance 
with the Constitution or laws, or on particularly important issues. 
 
Cabinet "understandings" are made on issues within th e portfolio of a ministry or agency, which need 
the consent of the cabinet as a whole because of the effects on other ministries and agencies concerned.  
Cabinet "orders" are made in accordance with laws. 
 
Q6-2. Could the Japanese authorities explain… the reasons for applying a lesser degree of 
transparency to Cabinet decisions and "understa ndings" than to Cabinet orders, and ministerial 
ordinances? 
 
A. Cabinet decisions and “understandings” concerning various policies do not possess a lesser 
degree of transparency.  These decisions are published on the website, and in the publications of, each ministry and agency. 
 Q7. In para.56, the Secretariat's report indicates that  prior notification is required for foreign direct 
investment in a fairly large number of sectors (this poi nt is also made in Chapter IV, with respect to 
the manufacturing sector, in para. 26). At the same time, it notes (see Chapter I, para. 33 on foreign direct investment) that inward FDI into Japan re mains substantially lower than outward FDI and low 
compared to other developed economies.  Given th e low flow of inward FDI to Japan, could the 
Japanese authorities indicate whether Japan is c onsidering easing FDI notification requirements? 
 
A. Under the Foreign Exchange and Foreign Tr ade Act (FEFTA), Japan has regulations on 
inward direct investment that comply with in ternational rules including the OECD Code of 
Liberalization of Capital Movements.  The scope  of the regulation under FEFTA is clearly identified 
in the government notice.  Since the regulation is less restrictive than that of other countries which 
don’t disclose the scope of regulation, it is not considered as an obstacle to the FDI. 
 The government notice of the Ministry of Fi nance:  http://www.mof.go.jp/hourei/kokuji/KO-
20070907-0001-15.pdf 
 Q8. With respect to paras. 13 to 17 as well as pa ra. 69 (see Chapter III on export procedures) of 
the Secretariat's report, Switzerland would have  the following question:  Could the Japanese 
authorities indicate whether Japan negotiated reci procal recognition of its Authorized Economic 
Operator programme with other WTO-Members, or  are such negotiations under way or planned? 
 
A. Japan Customs agreed to mutual recogn ition of on Authorized Economic Operator 
programme with NZ in 2008.  Currently, J apan is negotiating with the US and the EC. 
 
Q9. Para. 39 The Secretariat's report states th at government procuremen t is conducted without 
restriction on suppliers' nationality or on the origin  of products or services, that it is based on the 
principle of non-discrimination, and that no pri ce or other preferences are granted to domestic 
suppliers in tenders covered by the GPA.  Is it appropriate to understand that small and medium 
enterprises (SMEs) are fully covered by the said a ppreciation and that there is in Japan no specific 
measure providing to Japanese SMEs a treatment mo re favorable than the one granted to foreign 
suppliers and/or foreign SMEs ?    WT/TPR/M/211/Add.1 
 Page 125 
 
 
  A. Government procurement in Japan is basically conducted th rough open tendering 
procedures.  However, with respect to procur ement contracts between the government and a 
Cooperative Association or Federation of Cooperati ve Associations of small and medium enterprises 
(SMEs), the government may use limited tendering pr ocedures as an exception, in line with "Special 
Provisions for the Cabinet Order Concerning the Budget, Auditing and Accounting (Imperial 
Ordinance 558, November 22, 1946)". 
 As another part of its SME promotion policies, Ja pan enacted the "Law on Ensuring the Receipt of 
Orders from the Government and Other Public Ag encies by Small and Medium Enterprises" 
(hereinafter "the Law") in 1966, before conclusion of the "Agreement on Government Procurement" 
(hereinafter "GPA"). 
 The Law states that the Government, local authorities and other public agencies shall endeavor to expand procurement opportunities for SMEs, by impl ementing such means as the provision of 
information on procurement plans. 
 
In order to ensure that the Government can implem ent its policy in accordance with existing national 
laws and regulations and the GPA, Japan has notes rel ated to SMEs, they are Note 3 to Annex 1, 
Note 3 to Annex 2 and Note 2 to Annex 3 of Appendix I of the GPA.  
Q10. Para. 41:  According to the Secretariat's re port, the Government of Japan adopted in 2007 
measures aiming at improving competitive bidding methods.  As a result of these improvements, 
"open tendering" seems to have increasingly repla ced "single tendering" which is said to have 
declined from 44.1% to 32.7%.  Could the Japan ese authorities explain the differences between 
"single tendering" and the three tendering methods  covered by the GPA (open tendering, selective 
tendering and limited tendering)?   
 
A. Single tendering is a contract method that sel ects a specific contractor based on clause 4 or 
clause 5 of Article 29.3 of the accounts law.  It  corresponds to limited tendering in the agreement on 
government procurement.   Regarding single tendering in the accounts law, at tempts to ensure correspondence between the GPA 
and domestic law involve taking the necessary measures to ensure unity with limited tendering under 
the GPA.   
 
Q11. Para. 49 The JAS Law (the Law Concer ning Standardization a nd Proper Labelling of 
Agriculture and Forestry Products) incorporates ISO Guide 65 as registration criteria for certifying 
bodies.  The authorities expect the number of Re gistered Overseas Certif ying Bodies (ROCBs) under 
the JAS law to increase in the fu ture.  In this regard, could th e Japanese authorities indicate if 
compliance with ISO Guide 65, verified through fo reign accreditation, would be taken into account as 
an indication of adequate technical competence?  
A. During the accreditation of a certifying body, a va riety of factors are evaluated, such as the 
applicants' relationship with producers and compliance with ISO Guide 65.  Even if compliance with 
ISO Guide 65 is verified through foreign accredita tion, a decision cannot be made immediately 
concerning whether the certifying body has the techni cal competence equivalent to that of accredited 
certifying bodies under the JAS law. 
 Q12. Para. 55:  Japan has signed several agreem ents containing provisions relating to mutual 
recognition of conformity assessment procedures. C ould Japan elaborate on the concrete outcome of 
such agreements, for instance the number of confor mity assessment bodies that are recognized by the 
Japanese authorities under such agreem ents?  Does Japan envisage to  conclude further agreements 
along those lines? WT/TPR/M/211/Add.1 
Page 126  
 
  A. In regard to mutual recognition, Japan has signed agreements mainly on electrical products 
and on telecommunications equipment.  With regard to electrical products, Japan signed an Agreement on Mutual Recognition with the 
European Community in 2001 and an Agreement w ith the Republic of Singapore for a New-Age 
Economic Partnership in 2002.  The law on Implem entation of the Mutual Recognition between Japan 
and Foreign States in Relation to Results of Conformity Assessment Procedures of Specified 
Equipment has been enacted in a ccordance with the provisions of the said Agreements.  Based on the 
Agreement with the European Community, there is at  present no conformity assessment body in Japan 
and the EC.  Based on the Agreement with the Republic of Singapore, there is at present no 
conformity assessment body in Japan  and 1 conformity assessment body in the Republic of Singapore.  
 In regard to telecommunications equipment, J apan signed an Agreement on Mutual Recognition with 
the European Community in 2001 and an Agreement with the Republic of Singapore for a New-Age 
Economic Partnership in 2002, as well as an Agreemen t with the United States in 2007.  Based on the 
Agreement between Japan and the European Community, there are at present 6 organizations in the 
EC and 2 organizations in Japan regist ered as conformity assessment bodies. 
 Japan's basic position concerning the conclusion of mutual recognition agreements or agreements 
including the chapter for mutual recognition is to ne gotiate (1) based on industry's requests; (2) with 
countries or regions where technical barriers to trad e will be truly expected to be reduced and;  (3) 
on the premise that the compatibility of both sid es' regulation and the equality of both sides' 
competence in accreditation and supervision are con firmed.  When needed, Japan will consider 
conclusion of further agreements on a case-by-case basis according to the criteria stated above. 
 
Q13. In para. 59, the Secretariat's report notes that Japan imposes import prohibitions on beef and 
poultry from various countries.  Since Switzerland h as been classified by the World Organization for 
Animal health (OIE) as a country with "controlled BSE risk", and beef from animals below 30 months 
of age should therefore be traded without any restri ctions with regard to BSE, could Japan elaborate 
on the reasons for prohibiting Swiss beef imports or, alternately, present a scientific-based risk 
assessment for banning such imports?  A. In regard to imports of bovine meat and offa l from BSE infected countries, Japan, with the 
intension of setting out the trade requirements, requires a risk assessment that takes due account of 
the OIE code.  The process of the lifting import ban on beef originated from Switzerland is to be carried out 
following the same steps as those for other WTO Members.  This process includes technical 
consultations, consideration of im port requirements, the implementatio n of risk assessment, and so 
forth.  Currently, Japan is working with the Government of Switzerland towards science-based 
solutions for the resumption of beef import from Switzerland. 
 
Q14. In para.72, the Secretariat's report indi cates that the Japan Fair Trade Commission has 
recently sent a request to the Ministry of Land, Infrastructure and Transport to review the cartel 
exemption for shipping.  Could the Japanese aut horities indicate whether the Ministry of Land, 
Infrastructure and Transport intends to follow suit to  the request of the competition authorities and, if 
yes, over what time frame ?  A. The International Maritime Transport Sub-co mmittee, a special group under the Maritime 
Affairs Section of the Council for Transport Policy,  which is a ministerial advisory body for the 
Minister of Land, Infrastructure, Transpor t and Tourism, considered in 2007 whether the 
antimonopoly exemption for international shipping  activities remained necessary.  After careful 
consideration, the Council recommended in December 2007 that further consideration be given to  WT/TPR/M/211/Add.1 
 Page 127 
 
 
  this issue from the viewpoint of ensuring a comp etitive international shipping market as well as 
ensuring stable and reliable maritime transport.  Acco rdingly, the Ministry of Land, Infrastructure, 
Transport and Tourism intends to make further studi es on this issue from the following four points of 
view which were described in  the above recommendation: 
 
1. The antimonopoly policies taken by other nations and the impact of those policies on the 
Japanese shipping industry 
2. The development of the int ernational shipping market including the emergence of large 
shipping companies 
3.  Whether the agreements among shipping companies function to supply a stable shipping 
service 
4. The impact of the abolition of the an timonopoly exemption on the Japanese economy 
 
Q15. In para. 77, the Secretariat's report suggests that while Japan has high statutory rates for both 
corporate and personal income taxes, it also has one of the lowest tax to GDP ratios.  In particular, 
less than half of the personal income is being actua lly taxed.  Furthermore, there also seems to be 
scope for improved transparency, gi ven the apparent complexity of the local taxation system.  The 
Secretariat's report therefore concludes that there is a need for both broadening the tax base and improving the transparency of the taxation system  in order to improve tax collection given the 
budgetary problems Japan has been facing now for y ears.  Could the authorities indicate which fiscal 
reforms, if any, are being planned in this respect  and, if not, what problems are being encountered 
which have so far hampered a modernization of the Japanese taxation system ? 
 
A. In regard to broadening the tax base, it is s tipulated in the FY2009 tax reform bill, which is 
still being deliberated upon by the Diet as of  February 2009, that when considering future 
fundamental reform of the taxation system, Japan will consider broadening the corporate tax base as 
well as reducing the effective corporate tax rate.  A broadening of the personal income tax base is 
also left to future consideration.  On the other hand, Japan does not consider its lo cal tax system to be complicated or lack 
transparency just because it is comprised of 23 di fferent taxes.  In most countries having federal 
systems, it is difficult to systematically grasp their loca l taxation system.  This is attributed to the fact 
that these systems are established at the state level.  Japan's local tax system is integrated into the 
"Local Tax Law," meaning that, in general, all the taxes imposed by local authorities across the 
nation are connected into a single law.  Therefore, it is not appropr iate to regard Japan's taxation 
system as complicated because it is just composed of many tax items. 
 Q16. In para. 110, the Secretariat's report notes th at "in 2008, a bill to further amend the AMA was 
submitted to the Diet, but has not yet been adopted .  The bill seeks to introduce a surcharge on, 
inter alia,  exclusionary types of private monopoliza tion, abuse of dominant bargaining position, 
discriminatory pricing…".  It can be shown that price discrimination is in fact sometimes welfare 
enhancing:  under certain conditio ns, more consumers will be serve d if price discrimination is 
allowed.  Could the Japanese authorities indicate wh at types of price discrimination are prohibited 
under the Japanese AMA? 
 
A. Under the Antimonopoly Act, price discriminati on could be considered an infringement as a 
private monopolization or an unfair trade practice.  
Private monopolization is defined as "such bus iness activities, by which any entrepreneur, 
individually or by combination or conspiracy wi th other entrepreneurs, or by any other manner, 
excludes or controls the business activities of oth er entrepreneurs, thereby causing, contrary to the 
public interest, a substantial restraint of competition in any particular field of  trade" (Article2-5 of 
the Act).  Therefore, any price discrimination, wh ich causes a substantial restraint of competition, WT/TPR/M/211/Add.1 
Page 128  
 
  shall constitute an infringe ment.  Even price discrimination whic h does not bring about a substantial 
restraint of competition but tends to impede fair competition, shall be considered an unfair trade 
practice, which is defined as the act of "unjus tly supplying or accepting goods or services for a 
consideration which discriminates between regions or between parties" (Designation of Unfair Trade 
Practices, Article 3). 
 
Q17. Referring to para. 112, Table III-9: (export car tels) of the Secretariat's report, some export 
cartels are allowed under Japanese competition law.  Are all those cartels publicly known and does 
Japan not consider that such cartels can be detrimental in the long run? 
 A. The Export and Import Transaction Law requires  that prior notification be given to the 
Minister of Economy, Trade and Industry for the est ablishment of an export cartel.  However, such 
cartels have not been registered since 1999.  In general, the exemption systems are limited to th e absolute minimum, with a view towards greater 
utilization of market mechanisms.  
 
KOREA
 
 
Q1-1. What is the figure allocated for the "Econom ic Policy Package:  Measu res to Support People's 
Daily Lives" published on 30 October? Is the allocated figure separate from the ¥1.81 trillion 
allocated for the "Comprehensi ve Immediate Policy Package"? 
 
A. The size of the second supplementary budget for FY2008 aimed at implementing the 
"Economic Policy Package:  Measures to Suppor t People's Daily Lives" is approximately 
¥4.8 trillion, which is separate from the first supplementary budget (¥1.81 trillion) for FY2008 aimed 
at implementing the "Comprehensive Immediate Policy Package." 
 
Q1-2. The Secretariat Report (page 4, paragraph 5) describes in brief the specifics of the 
"Comprehensive Immediate Policy Package."  Co uld Japan further elaborate on the different 
programs included in this package? 
 
A. Please refer to the English summary of the package (available on the Cabinet Office's 
website) for further information.  Note that th e "fixed-term tax reduction amounting to ¥2 trillion" 
mentioned in the Secretariat report has been replaced by the same amount as a "fixed-sum benefit" in 
the second policy package published in last October.  
 
Q1-3. With regards to the "Comprehensive Imme diate Policy Package", please explain how (and in 
what context) the stated purpose of "vitalizing SME, supporting local governments, strengthening of agriculture, forestry and fisheries, and (suppor t) for housing and disaster measures" constitute 
'reform', its intended purpose.  A. This policy package aims at achieving three objectives, namely: 1) alleviating the anxiety of the people, 2) accelerating transformation to a "sus tainable society" and 3) facilitating adaptation to 
a new cost structure, there by boosting growth po tential. Please refer to the English summary of the 
package (available on the Cabinet Office's website) to find a basic explanation of the three objectives.  
 Q1-4. Could Japan further elaborate on the differen t programs that will be implemented within the 
context of the "Economic Policy Package:  Measures to Support People's Daily Lives"?   WT/TPR/M/211/Add.1 
 Page 129 
 
 
  A. Please refer to the summary of the package (available on the Cabinet Office's website) for 
information on other measures.  http://www5.cao.go.jp/keizai/index-e.html 
 
Q1-5. Please confirm whether there are any measur e within both the "Comprehensive Immediate 
Policy Package-Easing Public Anxiety" and "Eco nomic Policy Package:  Measures to Support 
People's Daily Lives" that does not conform to the G-20 Declaration of November, 2008.  
A. The measures in the two policy packages conform to the Declaration at the Summit on 
Financial Markets and the World Economy held in November 2008.  These policies uphold two 
principles confirmed in the Declaration, "st abilizing financial markets" and "supporting economic 
growth," and will contribute to the recovery of th e Japanese economy, which in effect will contribute 
to the stabilization of the world economy. 
 
Q2-1. Please confirm whether such plans are under c onsideration. If yes, please provide concrete 
details of this plan, and whether this plan is i ndependent or is somehow related to the two packages 
referred to in Question 1 above.  
A. On February 3, the Ministry of Economy, Tr ade and Industry of Japan submitted a revised 
bill, the "Industrial Revitalization Law" to an ordi nary session of the Diet.  In this revised bill, Japan 
plans to provide assistance to the private sector in th e form of direct capital infusion.  While this plan 
is under review, Japan can not reveal its details. Howeve r, an example scenario of this policy is as 
follows.  First of all, this is not a policy in which public funds are directly invested in  to private companies.  A 
company certified by the Minister of the Ministry of  Economy, Trade and Industry may be invested in 
to by private financial organizations (ex. The Devel opment Bank of Japan).  After a certain number of 
years (usually three years), should these financia l organizations suffer a loss, the Japan Finance 
Corporation will compensate for a part of said loss. Public funds are used for this compensation. 
Japan also intends to impose some requirements on the companies receiving financing.  For example, 
they should be companies which have established a business plan to recover or increase their profit. 
This policy is not related to the two packages referred to in Question 1. 
 
Q2-2. (If this reported plan will be implemented) please confirm how this plan conforms (or will 
conform) to the G-20 Declaration of November, 2008.  
A. This policy is not in contravention with th e Declaration issued at the Summit on Financial 
Markets and the World Economy in November 2008, as this program will be open to foreign 
capital-affiliated companies conducting operations in Japan. This program seeks to contribute to the 
recovery of the Japanese economy, which in effect w ould contribute to the stabilization of the world 
economy. 
 
Q3-1. As a general question, is there a particular  sector ("strategic sector") in which Japan would 
like to see more inbound FDI?  
 
A. In May 2008, Expert Committee on FDI Promo tion, which was established as an advisory 
body for the Minister of State for Economic and Fiscal Policy in our organization, issued "Five 
Recommendations Toward the Drastic Expansion of Foreign Direct Investment in Japan." 
 
One of the Five Recommendations was the "Establishm ent of priority strategies by sector."  The 
medical device industry was chosen as an import ant sector and an action program was formulated in 
December 2008 to improve the environment so that  the development of medical devices could be WT/TPR/M/211/Add.1 
Page 130  
 
  promoted in Japan.  Japan will c ontinue to choose some industri es as important sectors and attempt 
to expand FDI in those fields.  The said recommendations are available at: http://www5.cao.go.jp/invest-japan/index.html 
 
Q3-2 Could Japan elaborate on the specifics of the program launched in June 2006 in response to 
the goal set in May, 2006?  Please explain in deta il the specific action plans devised for each of the 
"3 Key Issues" included in the program.  
A. To achieve the goal set in May 2006, in June 2006 the Japan Investme nt Council launched a 
new program called the "Program for the Promotion of FDI in Japan" which focuses on 3 key issues:  
(1) the promotion of investment in local regions (2) the improvement of the comprehensive investment 
environment with sense of urgency (3) the pr omotion of greater understanding through public 
information activities.  Japan is promoting the in crease of FDI by practicing policies written on the 
program steadily.  
The Expert Committee on FDI Promotion publis hed "Five Recommendations Toward the Drastic 
Expansion of Foreign Direct Investment in Japan" in May 2008 to promote further FDI into Japan. 
Then, Japan revised "the Program for the Accelerati on of Foreign Direct Investment in Japan" in 
December 2008 in order to incorporate the Five Re commendations in the program.  Measures from 
Five Recommendations were distributed to  each sector as "3 Key issues." 
 Q3-3. Could Japan provide an assessment of th e program launched in J une 2006?  Has it been 
successfully implemented thus far?  Is Japan optim istic that the goal for 2010 will be attained as 
originally planned?  Are ther e plans for any adjustments? 
 
A. Japan has followed up "the Program for the Acceleration of Foreign Direct Investment in 
Japan" periodically, once a year.  Furthermore,  Japan revised the program in December 2008, and 
related ministries steadily implemented measures to in crease FDI into Japan.  It might be difficult for 
Japan to double FDI stock by 2010, because of the global financial crisis.  However, the Government 
of Japan, uniting its efforts, will continue to invite FDI in to Japan as one body through the 
implementation of the program steadily in order to achieve the goal.  
 Q3-4. Could Japan provide in detail follow- up measures implemented subsequent to the 
recommendations provided by the "Expert Committee on FDI Promotion" in May 2008?  
A. After the committee published the "Five Reco mmendations Toward the Drastic Expansion of 
Foreign Direct Investment in Japan" in May 2008, the Corporate Value Study Group published the 
report about comprehensive studies on M&A (takeover ru les).  The Cabinet Office held a meeting for 
a comprehensive study on Foreign Direct Investme nt regulations, which consisted of director 
generals from related ministries, and started the study in December 2008.  Regarding the establishment of priority strategies by sector, Japan has set the medical devices sector as a priority 
sector, and the Ministry of Health, Labour and We lfare decided on the Action program to dissolve 
"Device Lag" in December 2008.  Furthermore, th e Cabinet Office produced the FDI promotion DVD 
to strengthen Japan's message to  welcome FDI into Japan.  The DVD is available at Japanese 
embassies and JETRO overseas offices.  
 
Q3-5. Could Japan provide a copy of the "Pro gram for the Acceleration of FDI in Japan"? 
  WT/TPR/M/211/Add.1 
 Page 131 
 
 
  Program for Acceleration of Foreign Direct Investment in Japan (Provisional Name)  
Issue Measures that Should Be or Will Be Taken Ministries and Other 
Organizations Concerned 
1. Regional-Oriented Economic Growth  and Quality of Life Improvement 
 ○ The national government and JETRO will, in addition to cooperating with local 
governments, utilize networks with private s ector financing institutions and advisory 
agencies to ascertain the needs and desires of foreign corporations and local 
communities. They will coordinate with  the Industrial Cluster Project and SME 
measures, and take measures for special  zones and regional revitalization into 
account, in order to provide support th at extends seamlessly from identifying 
candidate businesses, to establishing enterprises, to expanding business. Cabinet Secretariat, 
METI, JETRO 
 ○ Develop information related to regiona l investment (information on industrial 
clusters in the local area , the specialized personnel, thebusinesses, and the 
infrastructure). Develop a Web site for par ties interested in investing that provides 
this information with further enhan cements tailored to their interests. METI, JETRO 
 ○ Improve internationally competitive resear ch and educational centers by applying 
measures to promote more focused invest ment, according to competitive principles, 
to those organizations that are aiming to become top world-level centers of excellence. In this way, aim to create about 30 research centers that are recognized as top world-level centers of excellence. CAO, MEXT 
 ○ Seek regional revitalization by means of "programs to revitalize regional centers of 
knowledge" that work by revitalizing a nd utilizing universities and other such 
organizations that are regional centers of knowledge. CAO, MEXT, Ministries 
and Agencies Concerned 
 ○ Promote international excha nge at the bilateral government level and in the private 
sector, making use of diplomatic channels  and JETRO, in order to create links 
between domestic and overseas industrial clus ters. Aim also for cooperation related to 
business tie-ups, joint research and de velopment activities, and international 
investment. MOFA, METI 
 ○ Achieve the goal of attracting 10 million fo reign visitors to Japan by the year 2010 
through steady implementation of the Vis it Japan Campaign and related programs. 
Aim to make Japan a "major power in tourism that stands open to the world." MLIT 
 ○ Reevaluate the special zone system with  a view to introducing a bill to the next 
regular Diet session, taking into considerati on locally originated proposals such as the 
Forum of Local Governments for Forum of  Local Authorities for the Promotion of 
Foreign Direct Investment in Japan 
○ Working on the assumption of active involvement by local communities, facilitate 
the formation of special zones to promote FDI in Japan that provide packages of 
regulatory exceptions and other such incentives for FDI. Cabinet Secretariat 
2. Improvement of an Investment Environment Capable of Overcoming Global Competition, Etc. 
A. Improvement of Environment for Corporate Business, Etc. 
A-1. Promote mergers, acquisitions, and other such reorganization as well as increased flexibility in 
organizational form to enable more effective use of management resources by corporations. At the 
same time, improve the lateral business environmen t for smoother securing of human resources and 
flow of personnel and goods, smoother transfer of  funds, improvement of technological and related 
infrastructure, and so on. 
  
 Increase Flexibility for Restruct uring and Organizational Form 
○ Steadily implement the portions of the Cor porate Law relating to the easing of rules 
on compensation for mergers, etc., by the summer of 2007. Also examine and reach a 
conclusion regarding related tax measures before implementation in terms of the 
appropriateness and fairness of taxation, and with a view to  preventing tax avoidance. 
Examine related legal systems as necessa ry to enable smoother reorganization.  
MOJ, MOF (METI), 
Ministries and Agencies 
Concerned 
 ○ Ascertain the actual status of utiliza tion of the limited liability company (LLC) 
system and limited liability partnership (LLP) system. METI 
 ○ Market oversight functions will seek to improve corporate transparency and 
reliability in order to enab le scrutiny of and ruling on corporate governance by 
providing for enhanced information disclo sure in listed corporations. This will 
involve review of the restrictions on take over bid (TOB) transactions and the system 
of large shareholding reports as well as th e adoption of a quarterly report system and 
strengthening of internal controls relating to financial statements and other such 
activities. FSA 
 ○ Promote disclosure of the status of exercise of shareholder voting rights by 
institutional investors in order to strengthen fiduciary responsibility. FSA, Ministries and 
Agencies Concerned 
  Cont'd WT/TPR/M/211/Add.1 
Page 132  
 
  Issue Measures that Should Be or Will Be Taken Ministries and Other 
Organizations 
Concerned 
 Develop Human Resources 
○ Take steps to secure creative, well-qualif ied personnel by improving the mobility of 
intellectual specialists, for example by th e broad-based adoption of a fixed-term 
system, the use of open recruitment for hiring researchers, and the promotion of 
personnel exchange among industry, academia, and government organizations. MEXT, METI 
 ○ Foster the development of personnel w ho have acquired speci alized knowledge as 
well as ability in the English language a nd skills in presentation, planning and 
management required in the world community, and who are able to engage in 
international activity. To this end, prom ote the enhancement of English language 
instruction, exchanges with foreign students,  and other such measures in primary and 
secondary education. MOFA, MEXT 
 ○ Make greater efforts to train personnel who can be adaptable and resourceful in 
both management and engineering, and pe rsonnel who are highly capable in foreign 
languages. To that end, utilize professional graduate schools to enhance education in 
fields such as technology management  and business, and support outstanding 
measures for educational programs at such  institutions. Take steps for the gradual 
adoption of accreditation systems to guara ntee the quality of universities and other 
institutions that provide education in these areas. MEXT, METI 
 Expand Acceptance of Foreign Personnel 
○ Take active measures to receive high quality human resources, including exchange 
students and research personnel, from Asia n and other countries. These will include 
strengthening the research and developmen t infrastructure, expanding scholarships 
and other support for receiving exchange stude nts, promoting empl oyment in Japan, 
improving the environment for foreigners in the universities and other institutions, 
and improving an environment to enable en counters by them with top-level Japanese 
personnel, facilitating a new cross fertilizati on of human resources. Work to attract 
overseas research and development center s, including foreign corporations, and 
expedite the inflow of human resources from other countries so as to develop 
internationally competitive research and development and educational centers in 
Japan and promote the conduct of inn ovative research and development. MOFA, MEXT, METI 
 Improve the Working Environment 
○ Recognizing the necessity to have fair and transparent civil rules for labor contracts 
defined clearly, conduct an examination of  the desired form of the law governing 
labor contracts. MHLW 
 ○ Taking the status of the implementation of  the defined contribution pension system 
into account, conduct an examination of sy stems with even greater ease of use. MHLW 
 ○ Expedite negotiations for agreements on so cial security with other countries in 
order to avoid dual membership in public pe nsions and other such social security 
systems, with the resulting wasted premium payments. MOFA, MHLW 
 Increase Efficiency of Flow of People and Goods, Etc. 
○ Bring a common government-wide portal into operation by 2008 as a next-
generation single-window system in accord ance with the operations and system 
optimization plan for imports, exports, and airport and seaport procedures. MOFA, MLIT, MJ, 
MHLW, MAFF, METI 
 ○ Move towards greater efficiency in the international flow of people and goods by 
improving facilities to expand the capacity of Narita, Haneda, and other airports and 
improve access to them by fiscal year 2009.  Also work to establish scheduled 
international service at Haneda Airp ort, and improve connections between 
international and domestic lines at  hub airports near major cities. MLIT 
 ○ Expedite the improvement of port and har bor bases and facilitate their operation on 
a 24-hour basis in order to strengthen the pe rformance of ports and harbors that are 
international transport hubs. Lower port a nd harbor costs and reduce lead times in 
super hub ports by fiscal year 2010. MLIT  
 Facilitate International Capital Movements, Etc. 
○ Improve international tax systems, to include amendment of tax conventions, in 
order to eliminate double taxation and levy appropriate taxes. MOFA, MOF 
  Cont'd  WT/TPR/M/211/Add.1 
 Page 133 
 
 
  Issue Measures that Should Be or Will Be Taken Ministries and Other 
Organizations 
Concerned 
 Institute Improvements Related to Technol ogy, Intellectual Property, Standards, 
Qualifications, Land Use, Etc. 
○ Work toward strategic prioritization of  science and technology in accordance with 
the Basic Plan for Science and Technology and comprehensive strategies for creating 
innovation. Stimulate development of scien ce and technology to the highest world 
level by conducting rigorous evaluation of se lected key projects while also steadily 
taking measures to expand competitive f unding, drastically strengthen review 
systems, and strengthen industry -academia-government collaboration. CAO (MEXT, METI) 
 ○ Create an intellectual property strategy th at includes active patent applications in 
other countries in order to promote colla boration between foreign corporations and 
Japanese universities. Improve funding for overseas patent applications by 
universities and other institutions while also improving international business-
academia collaboration and information disse mination functionality by measures such 
as setting up international coordinators  (provisional name) and reinforcing 
international negotiating capabilities. Also  expand international legal capabilities 
relating to contracts, and by such measures  strengthen the international functions of 
university intellectual property offices. CAO, MEXT, , METI 
 ○ Realize prompt, accurate patent examination at the highest world level by 
promoting structural reform of the patent application and examination process. Work 
to improve personnel systems and examination efficiency. METI 
 ○ Facilitate the basing of foreign corpora tions in Japan in sectors that require 
assessment of conformity in products, serv ices, personnel, and so on, by promoting 
mutual recognition of such assessment by  the countries concerned, and taking the 
circumstances of both countries into consideration. Ministries and Agencies 
Concerned 
 ○ Unify the specifications and standards fo r products and services that differ from 
country to country in order to prom ote international standardization. Ministries and Agencies 
Concerned 
 ○ Reevaluate the duration of fixed-term leas eholds for corporations with a view to 
long-term utilization of property by busine sses without ownership of that property. MJ, MLIT 
A-2. Promote measures that will contribute to  improved productivity and enhancement of public 
services for the nation through the use of fore ign corporations' know-how and capabilities in the 
various individual areas of service.  
 Public Services, Etc. 
○ Improve the environment for effective u tilization of the Private Finance Initiative 
(PFI) system in ways that are easier for fo reign corporations to make use of, in order 
to promote even better use of the vitality of  the private sector in the public service 
sectors. Also adopt a market testing sy stem, publicize the third-party contractor 
system in water supply and related operati ons, promote the Peace of Mind House Plan 
("Anshin House Plan" in Japanese) of good qua lity housing for the elderly, and so on.  
Ministries and Agencies 
Concerned 
 ○Support entry into Japan by top-level overseas  service corporations with a view to 
raising productivity. JETRO(Ministries and 
Agencies Concerned) 
 Pharmaceuticals and Medical Devices 
○ Conduct follow-up on the three-year plan fo r nationwide revitalization of clinical 
trials in order to move toward further im provement of the environment for clinical 
testing. In light of the results from fo llow-up, study measures for improving that 
environment. MHLW 
 ○ Further improve the handling of clinical trial consultations and approval review in 
the Pharmaceuticals and Medical Devices Agency, an independent administrative 
institution, by raising operational efficien cy, making use of outsi de personnel, and 
other such measures to  improve operations and strengthen structure. MHLW 
 ○ As regards approval of foreign manufacturers of medical devices according to the 
Pharmaceutical Affairs Law, the range of  manufacturers required to obtain approval 
and the documentation that must be submitted with applications will be considered on 
the assumption that safety will be as sured and personal information will be 
safeguarded. Given these considerations, work  to encourage still greater foresight for 
business operators by taking measures to make procedures more transparent, such as by clarifying operating criteria. Publish the stat us of progress made in this direction in 
fiscal year 2008. MHLW 
 ○ State the criteria involved in administra tion of the general nomenclature list of 
medical devices (JMDN) in order to increas e foresight in regard to the necessary 
procedures and documentation for specifi c approval review or examination for 
certification when placing new medical devices, and especially low-risk medical 
devices, on the market. MHLW 
  Cont'd WT/TPR/M/211/Add.1 
Page 134  
 
  Issue Measures that Should Be or Will Be Taken Ministries and Other 
Organizations 
Concerned 
 ○ Facilitate the utilization of foreign clin ical data, post-marketing utilization data, and 
other such data in approval review of dr ugs, for instance in the case of drugs for 
treating serious illnesses that afflict a sm all number of patients. Consider also 
methods for facilitating the utilization of data  from international collaborative trials, 
while assuring safety. Publish the status of pr ogress made in both efforts in fiscal year 
2008. MHLW 
 Food Products 
○ Publish the status of progress with respect  to the evaluation of food additives in 
appropriate form in order to im prove transparency and foresight. MHLW 
 
 Educational Services 
○ Provide guidance as needed regarding the purpose and meaning of standards for 
establishing specialized training colleges and miscellaneous schools when the Japan 
campuses of foreign universities want to be  designated as such colleges or schools. 
The fact that the authority to approve su ch establishment lies with the prefectures 
should be taken into consideration, as we ll as the economic situation of the Japan 
campuses. MEXT 
 Legal Services 
○ Aim for an annual level of 3,000 candida tes who pass the national bar examination 
in 2010, in light of the Program for Pr omoting Justice Syst em Reform. Further 
improve the training system for judicial a pprentices, given the increasing number of 
apprentices. Work to further the develo pment of high-quality legal personnel in 
Japan. MJ 
 
B. Review Administrative Procedures B-1. Improve information provision and simplify pr ocedures so that foreign corporations and 
investors can more readily obtain informa tion related to investment in Japan.  
 Provide Information Re lated to Investment 
○ JETRO and the other ministries and agenci es concerned operate the Office of Invest 
Japan where information is provided on pro cedures for various kinds of investment 
involved when establishing companies, conducting mergers and acquisitions, and 
establishing plants and shops. The invest ment information provided also includes 
information on markets and companies.  
All Ministries and 
Agencies Concerned, 
JETRO 
 ○ The ministries and agencies concerned are enhancing their provision of English-
language information related to investme nt on their Web sites. JETRO is also 
enhancing its provision of services and in formation in foreign languages other than 
English. Work will also go forward on the English-language translation of some 200 laws and ordinances under the plan for preparation of translations. All Ministries and 
Agencies Concerned, 
JETRO, Cabinet 
Secretariat 
 Simplify Procedures and Put Them On-Line 
○ Steadily implement action plans for the pr omotion of on-line service utilization and 
other such measures to further simplify pr ocedures and make them more available on-
line. Ministries and Agencies 
Concerned 
B-2. Assist investor foresight by further fac ilitating the active use of public comment procedures 
and pre-filing inquiry procedures, which clarify inte rpretations of laws and ordinances about which 
investors have queries.  
 ○ To further increase the utilization of pr e-filing inquiry procedures, determine the 
status of utilization and, as necessary, study issues and measures for further 
promoting utilization of these procedures. JETRO will provide su pport for pre-filing 
inquiries, as required, for corporations th at are considering investment in Japan, 
taking the needs of such corporations into account. All Ministries and 
Agencies Concerned, 
JETRO 
 ○ To further increase the utilization of public comment procedures, ascertain the 
status of implementation and act to broa den and deepen the use of this system. All Ministries and 
Agencies Concerned 
B-3. Strengthen Coordination within the Government  
 ○ Create a database of projects and measures  related to FDI to Japan and share that 
information within the government. CAO, All Ministries and 
Agencies Concerned 
 ○ Coordinate with the Council for the Promotion of Japan as a Tourism Leader, the 
Council for the Promotion of Privatizati on and Regulatory Reform, the Headquarters 
for the Promotion of Special Zones for Structural Reform, the Headquarters for 
Regional Revitalization, the Council for Sc ience and Technology Policy, and other 
organizations concerned to work toward mo re effective implementation of policies. Ministries and Agencies 
Concerned 
 
 
  Cont'd  WT/TPR/M/211/Add.1 
 Page 135 
 
 
  Issue Measures that Should Be or Will Be Taken Ministries and Other 
Organizations 
Concerned 
C. Improve the Living Environment 
C-1. Improve the systems for entry to and residence in Japan. (Reevaluate the situation in light of 
various issues involving resident status contro l for foreigners and the problems they face when 
living in Japan.)  
 ○ Improve the environment for business travel, including use of the APEC Business 
Travel Card, to smooth the process of entry to Japan for short visits for business 
purposes. MOFA 
 ○ Study the various issues involved in cons tructing an effective system for foreign 
resident status control. These include how  to develop arrangements for mutual access 
to and provision of information by the minist ries and agencies concerned with foreign 
resident status, what form the amended Alien Registration Law should take, whether 
the organizations that bring in personnel from other countries should also be made 
responsible for reporting, and so on. Reach  conclusions within fiscal year 2006. Ministries and Agencies 
Concerned 
C-2. Improve the educational environment for fo reign children resident in Japan by developing 
systems related to international schools a nd Japan campuses of foreign universities.  
 ○ Implement a system of low-interest lo ans for the improvement of international 
schools that meet certain requirements. METI, MEXT, 
Development Bank of 
Japan 
(OBJ) 
 ○ Provide guidance as needed regarding the purpose and meaning of standards for 
establishing specialized training colleges and miscellaneous schools when the Japan 
campuses of foreign universities want to be  designated as such colleges or schools. 
The fact that the authority to approve su ch establishment lies with the prefectures 
should be taken into consideration, as we ll as the economic situation of the Japan 
campuses. (Repeated entry) MEXT 
 
C-3. Improve the living environment for foreign reside nts by measures to deal with medical care for 
foreigners, the building of multicultural so ciety in regional communities, and so on.  
 ○ Support requests to bring foreign physicians  into Japan as appropriate in order to 
make medical care more convenient for foreigners residing in this country. MHLW 
 ○ Take steps for all of Japan's prefectur es and those cities designated by Cabinet 
Order to formulate their own guidelines or plans for the construction of multicultural 
society within fiscal year 2006, pattern ing them after the Regional Multicultural 
Society Promotion Plans formulated by the Ministry of Internal Affairs and 
Communications as guidelines for Japan's local regions. MIC 
 ○ Questions of medical care, education for ch ildren, friction with local residents, and 
other such real problems that foreigners face as residents in Japan will be taken up in 
the Liaison Council of Ministries and Agenci es Concerned with the Issue of Foreign 
Workers. The current situation will be analyzed w ith attention to the desired 
allocation of costs for resolu tion of these problems, and comprehensive measures will 
be compiled in organized form within 2006.  Steps will also be taken for collaborative 
study by the ministries and agencies concer ned in order to impr ove Japanese language 
education, to strengthen measures addr essing the issue of children not attending 
school, for example by providing directions  on school attendance, to increase the 
number of signs and markers in foreign la nguages, and to take other such measures. Ministries and Agencies 
Concerned 
3. Vigorous Conduct of Domestic and Inte rnational Public Relations Activities  
A. Domestic Public Information Programs to Further Deepen the Unde rstanding of the General 
Public  
 ○ Make use of regional Japan Investment C ouncils and other such means to provide a 
forum where leaders of local government can directly express and clarify their 
commitment to attracting foreign corpor ations. The national government will also 
provide active support so that  promotion of foreign direct  investment in Japan will 
become a nationwide program with regional roots. Regions that are engaging actively 
in programs to attract foreign corpora tions, therefore, will conduct their own 
campaigns to disseminate and enhance popular  awareness of the specific effects of 
FDI. CAO, METI, JETRO 
 ○ Gather together specific success storie s about investment and use them to 
disseminate and enhance popular awareness of  the effects foreign direct investment 
has had in Japan. Collect figures and perf orm statistical analysis on the effects of 
M&A, the contributions made to local em ployment, and so on. Publicize these in 
widely understandable form using all public information media. CAO, METI, JETRO 
  Cont'd WT/TPR/M/211/Add.1 
Page 136  
 
  Issue Measures that Should Be or Will Be Taken Ministries and Other 
Organizations 
Concerned 
 ○ Conduct studies to determine what kind of statistics on FDI are wanted in order to 
obtain a more accurate grasp of such investment and its effects. Take account of the 
status of statistical development in ot her countries, IMF and other international 
standards, and related considerations. MOF (METI) 
 ○ Conduct surveys of specific success stories of investment in other countries, the 
effects of FDI inducement, FD I inducement systems, and so on, in order to develop a 
body of objective data concerning the influen ce of such direct investment on Japan's 
economy. MOFA, METI, JETRO 
B. Overseas Publicity Campaigns  
 ○ Make Japan's welcoming stance to inve stment more widely known through sales 
campaigns conducted at the highest level by  Cabinet ministers and local government 
leaders. Investment missions will also be  dispatched. Implement permanent publicity 
programs by Japanese amba ssadors and other personnel at overseas diplomatic 
missions to attract FDI. CAO, MOFA, METI, 
JETRO 
 ○ Organize large-scale Japan i nvestment seminars in other countries with a view to 
providing occasions for Cabinet ministers a nd local government leaders from Japan to 
conduct high-level sales campaigns as well as  for inducing corporations to relocate in 
Japan and for forming business partnerships. 
 MOFA, METI, JETRO 
 ○ Develop information related to regiona l investment (information on industrial 
clusters in the local area, th e specialized personnel, the businesses, the infrastructure). 
Develop a Web site for parties interested in  investing that provides this information 
with further enhancements tailored to  their interests. (Repeated entry) 
 METI, JETRO 
 ○ Promotion of foreign tourism, particular ly as it increases the number of foreign 
visitors to Japan, is a contribution to increased international understanding. Public 
information campaigns will therefore be c onducted in other countries in coordination 
with the Visit Japan Campaign. 
 CAO, METI, MLIT, 
JETRO 
 ○ Provide information and other such  support in cooperation with activities 
conducted by chambers of commerce and si milar organizations in other countries. METI, JETRO 
 
Q4-1. Could Japan elaborate on the "substantial offers" in Mode 4?  
A. Japan has made substantial offers in Mode 4.  In the initial offer, Japan additionally offered 
commitments on the status of residence of "Lega l/Accounting Services," "Engineer" and "Specialist in 
Humanities/International Services"  under the Immigration Control and Refugee Recognition Act.   
 In the revised offer, Japan newly added four new serv ice suppliers: judicial scrivener,  administrative 
scrivener,  certified social insurance and la bor consultant, and land and house surveyor. 
 
Q4-2. In light of the last sentence of in paragr aph 24, can Japan confirm whether it is willing to 
commit its existing legislation on Mode 4 in its GATS schedule of commitments?   
A. Japan is considering the offer, which is relevant to the interests of developing countries.  
 Q5. Could Japan confirm whether a domestic system  for the notification and registration of GIs 
(for wines, spirits and other goods) are in place in Jap an? Is so, could Japan elaborate on its particular 
aspects?  
A. Japan has provided the "Labeling Standard Concerning Geographical Indications" based on 
the "Law Concerning Liquor Business Association and Measures for Securing Revenue from Liquor 
Tax." in order to protect the following geographi cal indications (GIs) identifying liquors (wines, 
spirits and Sake(Seishu)) which include:  1) a place of origin of wines and spirits pr otected in the territory of WTO Members;   WT/TPR/M/211/Add.1 
 Page 137 
 
 
  2) a place of origin of wines and spirits in  Japan designated by the Commissioner of the 
National Tax Agency 
3) a place of origin of Sake (Seishu) desi gnated by the Commissioner of the National Tax 
Agency 
 
(As of February 2009, five GIs are designated in Japan, including "IKI" (spirits), "KUMA" (spirits), 
"RYUKYU" (spirits), "SATSUMA"(spirits), and "HAKUSAN" (Sake (Seishu)).)  Japan does not have any other domestic system for th e notification and registration of GIs other than 
the aforementioned one. 
Korea 20  
Q6-1. From amongst the 9 EPAs in force as of today, which EPA has had the greatest impact – either positively or negatively- on the Japanese eco nomy?  Which sectors has benefited the most? 
Which sector has been adversely affected? 
 
A. Each EPA, in general, has contributed to the strengthening of the economic relationship 
between Japan and the other party of the agreemen t, thus positively contributing to the Japanese 
economy.  The EPA's direct impact upon individual ec onomic sectors is hard to identify and quantify.   
 
Q6-2. What are the difference between the Japa n-ASEAN EPA and individual EPAs with Thailand, 
Indonesia, Brunei, the Philippines, and Viet Nam? 
 
A. From a legal point of view, the Agreement on Comprehensive Economic Partnership among 
Japan and Member States of the Association of Sout heast Asian Nations (the AJCEP Agreement) and 
the individual bilateral EPAs are completely se parate agreements.  One co ncrete difference, for 
example, is that some chapters of the bilatera l EPAs, on such matters as Intellectual Property, 
Competition and Government Procurement, are not included in the AJCEP Agreement. 
 
Q6-3 For each of the 9 EPAs in force,  could Japan provide the following? 
- Total coverage, AG products c overage, Manufacturing products coverage, Fisheries Products 
coverage 
* in terms of tariff lines (at HS-9 digit) and in terms of bilateral trade volume 
 
A. For each of the 9 EPAs in force, tariffs on items that are traded between both sides will be 
eliminated by approximately the following percen tage within 10 years (based on outgoing and 
incoming trade values); 
Singapore: 99% 
Mexico: 96%  Malaysia: 97%  Chile:  92% Thailand:  95% Indonesia: 92% 
Brunei:  99% 
ASEAN: 92% Philippines: 94% 
 
Q7-1. What is Japan's assessment of the current situation?  Does Japan foresee further appreciation 
of the Japanese Yen in the coming months? 
 
A. The world financial crisis, along with the global recession, has recently affected the 
movements of foreign exchange markets.  Carry trade  has been unwound by the current economic and  WT/TPR/M/211/Add.1 
Page 138  
 
  financial situation.  Generally speaking, excessive volatility in the exchange rate is undesirable for 
economic and financial stability. 
 
Q7-2. If so, this could adversely affect the exports,  trade balance, and economic growth of Japan in 
the short term. What measures have been (or will be) implemented to cope with this situation? 
 
A. Japan will be watching carefully the various effects of the unwinding of the yen "carry trade" 
on exports, trade balance, and economic growth carefully. 
 
Q8-1. Could Japan provide further information on the economic stimulus package announced by the 
Japanese government in August, October and No vember of 2008 (amount, scope and expected 
effect)?  Are the 3 packages sep arate packages, or improvement s of the previously announced 
stimulus packages?  
A. Please refer to the English summaries of the three packages (available on the Cabinet 
Office's website) published in August, October and December 2008 for information on their amount 
and the scope.  The combined impact of these three economic packages on the Japanese real GDP 
growth for FY2009 is estimated to be around 1.0 p ercentage point.  As already answered in question 
1, the first and the second policy packages are suppo rted by independent supplementary budgets.  The 
third package includes the second package hence partly supported by the second supplementary 
budget for FY2008 (the remaining part is supported by  the annual budget and the tax reform for 
FY2009).  
Q8-2. What is Japan's estimate on the contri bution of the aforementioned economic stimulus 
package(s) to the GDP growth of Japan for 2009?  What % increase is expected? 
 A. Based on the available data, the economic policy packages (the "Comprehensive Immediate 
Policy Package –Easing Public Anxiety-", "Econom ic Policy Package:  Measures to Support People's 
Daily Lives" and "Immediate Policy Package to Sa feguard People's Daily Lives") are expected to 
have an impact of approximately 1.0 percentage poi nt on Japan's real GDP growth rate in FY2009. 
. 
Q8-3. In light of the existing fiscal deficit and the public debt, what plans does Japan have to relieve 
the concerns that such a large-scale economic stim ulus package may further aggravate the Japanese 
government's fiscal situation?  
A. Japan will implement decisive economic  and fiscal management through a fundamental 
stance that entails being bold over the short-t erm and responsible over the medium-term. Regarding 
the efforts for the restoration of fiscal health , the mid-term policy will be achieved through 1) 
continuing expenditure reform, 2) Continuing fundamental reform of the tax system, and 3) a growth policy, among other measures.  Specifically,  1) The government will intensively allocate budgetary resources to appropriate targets taking 
into account social and economic changes while  continuously maintaining the basic direction 
of on-going expenditure reform. 
2) The government will implement a fundamental reform of the tax system including the 
consumption tax in accordance with th e "Mid-Term Program" (Cabinet Decision on 
December 24, 2008). 
3) The government will make intensive effort s to attain economic growth, thereby supporting 
economic recovery and realizing Japan's mid- an d long-term economic goals.  This is 
expected to alleviate the fiscal burden being pushed onto current a nd future generations. 
 
Q9. Could Japan elaborate on this change? What where the policy objectives of this change?  
What is Japan's assessment (as of today) on this change?  WT/TPR/M/211/Add.1 
 Page 139 
 
 
  A. At the end of 2007, the Chief Cabinet Secret ary gave instructions to  reduce the number of 
councils of which the Prime Minister and the Chie f Cabinet Secretary were members.  Consequently, 
the Japan Investment Council was abolished in Dece mber 2007.  However, Japan needed to continue 
to endeavor to meet the goal to double FDI by 2010 and newly established the Expert Committee on 
FDI Promotion, an advisory body for the Minister of State for Economic and Fiscal Policy, in 
January 2008.  The committee published "the Five Recommendations Toward the Drastic Expansion 
of Foreign Direct Investment in Japan (Shimada Report)" in May 2008.  The committee is highly 
evaluated both at home and abroad. 
 
Q10. Korea would like to request a list of exports  control measures maintained by Japan, including 
its legal basis.  
 
A. To maintain both national and international  peace and security, Japan controls exports of 
arms and certain dual-use items in accordance w ith the Foreign Exchange and Foreign Trade Act.  
This measure is based on United Nations S ecurity Council Resolution 1540 and other relevant 
international commitments such as in ternational export control regimes.   
 In order to implement other int ernational agreements such as the Convention on International Trade 
in Endangered Species of Wild Fauna and Flora, Japan control exports in accordance with the Foreign Exchange and Foreign Trading Act.   
Please refer to the following website for the complete list of controlled items. 
Export Control Order:  Appended Table 1 and Table 2 http://www.cas.go.jp/jp/seisaku/hourei/data/ETCO.pdf 
 
Q11. What is Japan's assessment for the downturn  of the share of foreign suppliers in the GP 
market of Japan? 
 
A. The share of foreign suppliers awarded procu rement through the Action Program, in terms of 
monetary value, slightly decreased by 0.6% from 2004 to 2006.  Meanwhile, in terms of the number of 
contracts, that ratio was 3.0% in 2006, increasing from 2.0% in 2004.  The government of Japan has no further detailed analysis on these statistical trends. 
 
Q12. In light of the above, Korea would like to i nquire whether Japan has any plans to improve the 
market access opportunities of its trading partners by either a) accepting overseas certification, b) 
introducing simplified procedures for obtaining JI S/JAS certification, or c) introducing support 
programs for foreign firms. 
 
A. (1) JIS 
The JIS Mark scheme itself is vo luntary unless it is required to obtain JIS Marks for selling products 
in Japan according to regulation.  The JIS Mark scheme is an internationally harmoni zed scheme, based on ISO/IEC Guide 65.  Under 
the scheme, foreign conformity assessment bodi es can receive accreditation from Japan and can 
certify manufactures.  At present, there are three accredited certification bodies outside Japan: two of them are based in 
Korea, the "Korean Standards Associ ation" and the "Korea Testing and Research Institute."  Korean 
manufactures can obtain JIS Mark certification fr om these Korean certification bodies.  There are 
239 Korean JIS Mark certified manufactures, which is  the second largest number for any country in 
the world. 
 
Hence, the JIS Mark scheme creates no unn ecessary obstacle to international trade.  WT/TPR/M/211/Add.1 
Page 140  
 
  (2) JAS 
JAS compliance is not required for entry of products  into Japanese market.  Therefore the JAS mark 
scheme is not an obstacle for international trade. B esides, the JAS law does al low for overseas firms 
to obtain JAS certification through Registered Ce rtifying Bodies (RCBs) or Registered Overseas 
Certifying Bodies (ROCBs) through the same c onditions as those app lied to domestic firms. 
 
Q13. In light of the above, Korea would like to in quire whether Japan has any plans to improve the 
market access opportunities of its trading partners in the near future thro ugh either a) accepting 
overseas test results, b) introducing simplified pr ocedures, or c) introducing special assistance 
programs for foreign firms. 
 
A. (1) Road vehicles 
 In regard to regulations and certification for road vehicles, ever since signing the Agreement on 
Uniform Technical Prescriptions for Vehicles (t he 1958 Agreement), Japan has been actively 
promoting this Agreement, with the intention of disseminating safer and more environmentally 
friendly vehicles standards and promoting more efficient  international distribution of vehicle parts 
and equipments.  For example, Japan has been active in ensuring the international harmonization of 
regulation and the appropriate implementation of the mutual recognition of certifications.  Currently, 
Japan has applied 38 Regulations under the Ag reement (UNECE Regulations) to its domestic 
regulations, and implements the mu tual recognition of certifications. 
 
Japan intends to apply UNECE Regulations in th e order corresponding to the priorities of Japan, 
taking into account various elements such as domestic and international requests, the impact on 
safety and the environment, the economic ramifications of harmonization, and so forth. In order to do 
this, Japan will actively promote the application of  UNECE Regulations and,  as appropriate, propose 
necessary amendments to said Regulations to reflect  the traffic situation in Japan, when the World 
Forum for Harmonization of Vehicle Regulations is held by the UN.  (2) Electricity/gas/chemical products  Foreign manufactures of electric products and c onsumer products have been allowed to undergo 
conformity assessments and certific ations conducted in foreign countries by the Foreign Registered 
Conformity Assessment Bodies, in accordance with  respectively related laws (Electrical Appliance 
and Material Safety Law, Consumer Product Safety Law).    In addition, foreign manufactures of containers and designated equipment for high pressure gas 
which are registered with the Japanese government have been allowed to testify to the conformance of 
their products by themselves under the High Pressure Gas Safety Law. 
 Foreign producers who export electric products, c onsumer products and gas related products to 
Japan have also been given the same opportunities to  receive conformity assessments by CABs or to 
testify on the conformity of their products by themselves. 
 
As for Chemical products, under the Law concern ing Examination and Re gulation of Chemical 
Substances and Regulation of their Manufacture, Japan accepts the test data developed in other countries for the purpose of notifying to regulat ory authorities using OECD Test Guidelines and 
OECD GLP principles, in accordance with the "Decision of the Council concerning the Mutual 
Acceptance of Data in the Assessment of Chemicals" made by the OECD Council. 
 
Q14. What is the assessment of Japan for this s ituation, what measures are being taken to address 
this issue?   WT/TPR/M/211/Add.1 
 Page 141 
 
 
  A. International call rates have been steadily decreasing since 1996; for example, the rate of a 
phone call between Japan and the U.S. in 2006 was a pproximately one seventeenth of that of 1996. 
 Japan has been implementing various measures to further promote competition in the field of 
telecommunications under the "New Competition Promotion Program 2010," which is the roadmap 
for the implementation of measures by the early 2010s.  Through further liberalization in the field of 
telecommunications with such approaches, Japan beli eves that appropriate standards will be ensured 
for the international calling rate (See the respon se in Q15 for more details of this program). 
 
0100200300400500
Nov. 1996- Oct. 1999- Dec. 2000-      Dec. 2004-      International Call Rate (Japan - U.S.)
(Three-minutes, weekday, day-time rate)
KDD:  450 yen
JT:  440 yen
1 4 3 2KDDI:  27 yen
SBT:  26 yenDeutsche Telekom:  75 yen Fusion:  45 yenJT:  180 yenKDDI:  180 yen
NTT Com:  160 yen
 
 
Q15. Korea would like Japan to elaborate on this program, and explain how competition in relevant 
markets is evaluated and how corrective measures ar e implemented.  Especially, Korea would like to 
know what measures are taken against the market  dominance maintained by NTT Corporation. 
 
A. To further promote competition in tel ecommunications markets and secure user benefits, 
Japan released the "New Competition Promotion Progr am 2010" in September 2006 as a roadmap of 
measures to be implemented by the early 2010s.  The Program includes the following measures:  
 
i) Promotion of Facility-based Competition ii) Review of Designated Telecommunications  Facilities System (Dominant Regulations)  
iii) Review of Calculation Method for In terconnection Charges of NTT East/West 
iv) Promotion of Competition in the Mobile Communications Market 
v) Development of Environment Conducive to Implementation of IP-enabled Communication 
Terminals 
vi) Review of Tariff Policies vii) Review of Universal Service System viii) Development of Suitable Envir onment to Ensure Network Neutrality 
ix) Strengthening Dispute Settlement Functions 
x) Enhancing Consumer Protection Measures 
xi) Others  WT/TPR/M/211/Add.1 
Page 142  
 
  Japan has been applying the results from such revi ews and introducing new measures based on the 
Program.  Furthermore, in October 2007, Japan  revised the Program in response to the rapid 
changes in the market environment and compiled the report on the progress made that year.  The 
detailed contents of the Program are made public in the following URL:  
http://www.soumu.go.jp/joho_tsusin/eng/Relea ses/Telecommunications/news071023_2.html(Eng.)  
 
Regarding the evaluation of the relevant markets,  Japan has been conducti ng annual competition 
reviews in the telecommunications business field si nce FY2003 so that Japan can reflect into its 
policies the market situations that continues to c hange in accordance with the transition to IP-based 
networks and the progress of br oadband penetration.  
 
Based on the results from such reviews, Japan recogni zes that certain providers are deemed to have 
potentially significant market power either alone or jointly with other providers in the relevant 
markets excluding the CATV Internet market and the ISP market, but appropriate regulations are 
properly installed so that such significant powers are not exercised in the market.  The following are 
the relevant newsletter and press release: 
http://www.soumu.go.jp/joho_tsusin/eng/Relea ses/NewsLetter/Vol19/Vo l19_09/Vol19_09.pdf  
(English news letter)  http://www.soumu.go.jp/joho_tsusin/eng/Releases/ Telecommunications/news080917_3.html  (English 
press release)  
 
Concerning the last part of the question, market  dominance in the telecommunication markets are 
regulated mainly based on the "Designated Teleco mmunications Facilities System," and based on this 
system, Japan applies service regulations, restrictions on prohibited acts, as well as interconnection 
rules.  Especially, to ensure fair competiti on against the NTT Group, Japan can apply certain 
conditions on NTT East and NTT West in the app roval procedures of the regulatory frameworks 
pertaining to the authorization of business activities using facilities, technologies, or staff of NTT East and NTT West;  they must ensure the smooth operations  of local telecommunications activities as well 
as ensure that they do not interfere with the fair competition environments in the telecommunications 
market. In this regard, Japan can introduce certain requirements for each relevant approval.  At the 
same time, to further promote competition, Japan introduced the "Competition Safeguard System" in 
2007 in order to systematically organize such requi rements for fair competition and review them 
regularly, and to review facilities to be desi gnated under the "Designated Telecommunications 
Facilities System."  
 
INDIA
 
 
Q1. Can the authorities explain in which all sectors the recession will be most affecting? 
 
A. According recent national statistics, the I ndustrial Production indices for "electric parts," 
"devices" and "transport equipment" showed subs tantial decreases in the fourth quarter of 2008 
(October-December).   
Q2. Although Japan's FDI inflows increased signi ficantly in 2007, the level of inward FDI 
remains low compared with other developed ec onomies.  FDI outflows increased steadily between 
2005 and 2007 (Para 3, page 3-4, chapter 1).  Japanese authorities may please explain the major 
reasons for a reduced inward FDI and also a sector wise analysis.  
A. Some of the reasons for the lower level of  FDI into Japan compared to other developed 
countries are the geographic element, the problem of  language, and so on. In addition, obstacles for 
decrease of business cost, deregulation, system re form, and increasing of transparency are needed for  WT/TPR/M/211/Add.1 
 Page 143 
 
 
  further inward FDI.  Members of  the Expert Committee on FDI Promotion pointed out that the 
biggest obstacle is the weakness of Japan ese economic growth, and provided specific 
recommendations written in the "Five Recommenda tions Toward the Drastic Expansion of Foreign 
Direct Investment in Japan."  
For further information about the recomme ndations, please see following website: 
http://www5.cao.go.jp/invest-japan/index.html 
 
Q3. The One Village, One Product (OVOP) is one of  the typical approaches under this initiative. 
OVOP is a movement which supports local econom ies through the development, improvement and 
promotion of local products (foods , beverages, textiles & garments, etc.) with the participation of 
local people. (Page 19, Para 78, 79).  It may be he lpful if Japan could explain which are the products 
covered in the scheme and details  of how it is implemented? 
 
A. The One Village One Product Initiative was announced as one of the measures of Japan’s 
Development Initiative at the WTO Hong Kong Mini sterial Meeting in 2005.  Through the One 
Village One Product Initiative, Japan provides a ssistance for Least Developed Countries (LDCs) and 
other developing countries to enhance their ability to identify, improve and export their products to 
the Japanese market.  The OVOP enables countries to reap greater benefits from the multilateral free 
trade system embodied by WTO agreements.  
With that purpose in mind, Japan is sending experts to assist with the development and marketing of 
products exported to Japan.  Local products such as natural s oap, stationery, clothing, and cut fl ower are covered by this scheme. 
These products are introduced at expos itions in Japan, and in the shops  of the international airports 
of Narita and Kansai.  These expositions and shops pr ovide opportunities for Japan's importers and 
consumers to touch and handle the goods. 
 
Q4. Improvement of productivity is envisaged th rough implementation of the sector-by-sector 
productivity improvement programme, establishment of an emergency reserve budget for funding 
project using innovative technology,  and creation of "super special z ones" for developing cutting edge 
medical care. (Para 14, Page 6, Chapter 1)  
 Japan may explain what is meant by the super special zones and how they are going to be implemented?  A. In order to overcome any impediment to the development of innovative technologies, Japan 
has established a "Super Special Consortia," where in tegral and efficient adm inistration of research 
funds and discussions with regulatory authorities at the early stages of development are experimentally implemented.  The special zone is not a usual special zone ba sed on a certain administrative area.  Rather, the 
consortia are characterized by the composition of special zones established for the purpose of 
promoting efficient development of relevant resea rches by connecting researchers who study in a 
similar field but reside in different locations.  In FY2008, Japan for the first time established the "Super Special Consortia to support the 
development of cutting-edge medical care" in or der to promote cutting-edge regenerative medical 
care and the development of drugs and medical devices.  In November 2008, we adopted 24 projects. 
 WT/TPR/M/211/Add.1 
Page 144  
 
  Q5. Through its Project to Promote Foreign Direct Investment in Selected Areas, the Government 
supports activities conducted by selected regional gove rnments, include planning of strategies to 
attract FDI.  In FY2004, four regions were selected for such support measures;  by FY2007, 17 regions had been selected.  In FY2008, the Gove rnment started a project to help in potential 
investors to regional exhibitions, with a view to creating further business opportunities in Japan.  
(Page 31. Para 62, Chapter 2). It may be useful if  the authorities are able to share information which 
are the selected areas and why they prefer some areas instead at the national level?  
A. The purposes of promoting FDI in Japan are "regional activation" and "improving 
productivity and the quality of life."   Japan supported the expansion of  FDI to promote the creation of 
new business using regional resources up until FY2007 .  Japan has supported the creation by 
potential foreign investors' and companies creation of further business opportunities with local 
governments at regional exhibitions since FY2008.  The Ministry of Economy, Trade and Industry (METI) has been supporting foreign companies 
investment in Japan by encouraging business matc hing with Japanese companies, inviting companies 
to Japan, and by helping foreign com panies to establish a business in Japan. 
 Business Matching events at expositions in Japan in 2008 are as follows.  1. JAIMA 2008  
Industry: Manufacturers of analytical instruments 
 2. ENVIRONMENT&TECHNO LOGY EXHIBITION 2008 
Industry: Environment, New energy  
3. Nagoya ECO car clean Fair 2008 
Industry: Automotive  4. The Hokkaido Technical Information and Business Exchange Fair Industry: IT, Environment , Biotechnology,  Machinery and  so  on.  
5. Tokyo Industry Exhibition 2008 
Industry: Information, Environment, Me dical care, Welfare, Machinery and Metals. 
 6. SEMICON JAPAN 2008 Industry: IT 
 
Q6. Which are the major areas in wh ich the authorities seek FDI in Japan? 
 
A. In May 2008, an Expert Committee on FDI Prom otion, which was established as an advisory 
body for the Minister of State for Economic and Fiscal Policy, issued "Five Recommendations 
Toward the Drastic Expansion of Foreign Direct Investment in Japan."  
 
One of the Five Recommendations was the "Establishm ent of priority strategies by sector."  The 
medical device industry was chosen as an import ant sector and an action program was formulated in 
December 2008 to improve the environment so that  the development of medical devices could be 
promoted in Japan.  Japan will c ontinue to choose some industri es as important sectors and attempt 
to expand FDI in those fields.  The said recommendations are available at: 
http://www5.cao.go.jp/invest-japan/index.html 
 
Q7. It would be helpful if Japan could explain how the envisaged tax reform since the previous 
review in 2007 is going to affect the inward FDI and foreign trade of Japan?   WT/TPR/M/211/Add.1 
 Page 145 
 
 
  A. It is difficult to evaluate quantitatively the effect of tax reforms since the previous review on 
the inward FDI and foreign trade of Japan.  Japan has introduced taxation measures that contribute 
to promoting inward FDI, such as taxati on measures following the expansion of allowable 
considerations for mergers and other reorganiza tion (triangular mergers) under the new Corporate 
Law, that was introduced in FY2007 tax reform. 
 
Q8. In FY2008, Japan's tariff schedule comprised 8,841 lines at the HS nine-digit level.  Japan has 
bound 98.8% of lines (108 lines are unbound).  Unbound lines relate mainly to fisheries (fish, crustaceans, and seaweed), petroleum oils, and wood a nd articles thereof.  It may be useful if Japan 
can explain why it keeps these important tariff lines unbound as these are important items in the 
developing countries’ export basket. (Page 34 para18 chapter 3). 
 
A. As stated in the Report by the Secretar iat, 108 tariff lines are unbound in Japan's tariff 
schedule.  These unbound tariffs are c onsistent with WTO Agreements. 
 
Japan will continue to engage in discussion in th e WTO in a constructive manner and set appropriate 
types and levels of tariffs, while considering the progress and results of DDA negotiations.  
Q9. Of the 8,841 tariff lines, 93.3% involve ad valorem  rates;  2.4% are specific, 3.3% alternate, 
and 0.6% are compound rates;  0.4% of tariff lines have other rates (differential duties and sliding 
duties).  A sliding duty involves a specific tariff ra te for imports valued up to a certain threshold 
(Page 36, Para 19 & footnote 10, Chapter 3).  It may be useful if the authorities can explain how the 
threshold limit of sliding duty is fixed?  
 
A. The threshold is set based on the market tr ends, balance between protection for domestic 
producers and benefits for users/consumers, and other fact ors involving the related products.  Sliding 
duties are applied consistently  with the WTO Agreements. 
 
Q10. According to the Secretariat report (Chapter III, Page 37 Chart 1) footwear items enjoy higher 
level of tariff where India has large export competiti veness. Simple average tariffs are considerably 
higher for footwear. (Para23, Page 78) Leather foot wear items are subject to quotas.  Under the TRQ 
(pooled quota) system, an import duty of 17.3% to 24% is levied on import of foot wear within the 
quota threshold.  The import exceeding this quota thres hold is subject to higher rate of import tariff of 
30%. The TRQ system tends to limit the orders of the Japanese buyers and therefore acts as a non 
tariff barriers (NTB) to the export of footwear to  Japan.  Would the Japanese government inform by 
when it aims reform in these sectors?  
A. The tariff rate quota system is consistent w ith WTO Agreements and should therefore not be 
considered as a NTB. 
 With regard to tariff quotas (TQs) on leather and leather footwear, Japan has no concrete plan to 
reform the existing TQs due to historic and social difficulty conf ronting this sector.  
 
Q11. Items such as dairy products, some footwear , and textiles and clothing are not included in the 
GSP scheme for developing countries and are therefor e subject to applied MFN rates of duty.  These 
items are important for the export baskets of devel oping countries and it is useful if Japan can provide 
a clear roadmap on reforms in their present condition.  
A. Japan grants preferential tariff treatment under its GSP scheme to 141 developing countries 
and 14 territories for 337 agricultural and fishery products  and 3,217 industrial products at the nine-
digit tariff line level.  Japan will continue to examine  all aspects of the GSP scheme, in a preparation 
for a possible revision of the scheme, which is scheduled for 2011.  
 WT/TPR/M/211/Add.1 
Page 146  
 
  Q12. Though the tariff levels of non-agrarian products  of Japan is very low, the products in which 
developing countries has a competitive edge enjoys high protectionism.  Agricultural products receive 
much higher protection than non-agricultural produc ts.  The simple average for agriculture (WTO 
definition) is 18.8% compared with 3.6% for non-ag ricultural products.  It might be interesting to 
know whether Japan envisages a reform on the non- ad valorem  duties imposed on agricultural inputs. 
 
A. The application of non-ad valorem tariffs  on certain agricultural products in Japan is 
consistent with WTO Agreements.  Japan will conti nue its efforts to set appropriate tariff types and 
levels in line with the results of DDA negotiations. 
 Q13. Tariff rate quotas (TRQs) apply mainly to ag ricultural products, including rice, milk and dairy 
products (whey, butter), prepared edible fat, drie d leguminous vegetables, wheat, barley, ground nuts, 
tubers of konnyaku, starches, and silk-worm cocoons  and raw silk.  TRQs cover 1.7% of all tariff 
lines. (Page 72 , Para. 10, chapter IV ).  This also  impair the competitive edge of developing countries 
and does Japan have any schedule for effecting reform s in this area to assist developing countries to 
improve access to the Japanese market? 
 
A. TRQs for agricultural products are administ ered appropriately and in a fair and transparent 
manner by considering the characteristics of ea ch product.  They do not necessarily disadvantage 
exporting countries, including developing countries.  In addition, Japan has been assisting developing 
countries to improve market access through its "Development Initiative for Trade" since 
December 2005.  
Q14. The Japanese TRQ regime is a clear violati on of Article XI:1 of GATT, 1994 which stipulates 
that "no prohibitions or restrictions other than dutie s, taxes or other charges, whether made affective 
through quotas,.....shall be in stituted or maintained by any contr acting party on the importation of any 
product.....".  The Japanese measure is trade rest rictive and acts as a disguise protection for its 
domestic industry.  Japan is requested to explai n whether any measures are being considered to 
comply with the GATT, 1994 provisions.  
A. Japan is convinced that the Japanese TRQ regime is consistent with WTO Agreements 
including the GATT 1994. The Japanese TRQ regime is implemented in line with Japan's schedules of 
tariff concessions (Section IB and Section II) .  
Q15. Preferential rates of tariff are offere d under the GSP to 142 developing countries and 
15 territories, including additional preferences for 50 least developed countries. (Para 25, Page 37, 
WT/TPR/S/175/Rev.1).  It might be useful to know the criteria followed in granting the GSP status to 
various countries/commodities.  It will be useful  if Japan would clarify whether it is using same 
criteria to evaluate products fro m LDCS and Developed Countries. 
 
A. Japan offers reduced tariff rates for products from developing countries and territories, 
including LDCs, for the purpose of contributing to  the development of those countries and territories. 
 
In regard to the evaluation, Japan uses the same cr iteria for the evaluation of products from LDCs 
and products from developed countries.  
 
Q16. The data on tariff escalation show no overall c onsistent pattern other than that the high level 
of protection granted to agricultural products resu lts in higher overall tariff protection for primary 
products than for semi-processed products.  Tari ff escalation from semi-processed to final goods is 
present in some sectors, notably textiles, petroleum refineries, and non-electrical machinery.  In other sectors, such as food products and manufacturing,  leather products, wood a nd paper products, other 
chemicals, non-metallic mineral products, and metal products, protection for fully processed goods is 
lower than for semi-processed products, while escalation from prim ary to semi-processed and final  WT/TPR/M/211/Add.1 
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  products is evident only for industrial chemicals and rubber. (Table AIII.1). (Para 23, Page 36, 
WT/TPR/S/175/Rev.1).  For developing countries in ge neral and India in particular this pattern of 
tariff escalation may turn as trade distorting. It may be helpful if Japan explain how it can maintain its 
stated objectives of the trade policy in the background of the data on tariff escalation.  A. Japan sets an appropriate level of tariff rate on each product by taking into account the situations of domestic industries. Issues including  tariff escalation are one of the elements of the 
agriculture and NAMA negotiations, Japan will c onsider the result of the DDA negotiations, when 
addressing these issues in the future. 
 Q17. Japan currently imposes import prohibitions on beef and poultry from various countries due to 
BSE and avian flu. (Para55. Page 45) Japan ma y please explain which the countries from which the 
import is prohibited and what are the certification standards that are followed to assess the quality of 
the product?  A. Regarding countries from which Japan prohibits the import of bovine meat and offal due to 
BSE, please refer to Footnote 50, page 50. Those countries are Austria, Belgium, Czech Republic, 
Denmark, Finland, France, Germany, Greece, Irel and, Israel, Italy, Liechtenstein, Luxembourg, 
Netherlands, Poland, Portugal, Slovakia, Slov enia, Spain, Sweden, Switzerland, and the 
United Kingdom.  Risk assessment by the Food Saf ety Commission is required for lifting the import 
ban on beef set due to BSE. 
 
Regarding countries or regions from which Japan pr ohibits the import of poultry due to avian flu, 
please refer to the website of Animal Quarantine Service of Japan: http://www.maff.go.jp/aqs/english/ 
news/hpai.html.  In case of being requested to lift import ban on poultry products, Japan will conduct 
a risk assessment in accordance with the proce dure titled "Standard procedure for consideration on 
requests for import of designated items to be quar antined into Japan," which has been notified as 
"G/SPS/N/JPN/207." 
 
Q18. Preferential Tariffs on industrial products are zero except for sensitive industrial products 
(1,192 items at the HS nine-digit level in 78 pr oduct groups) to which various preferential rates (0%, 
20%, 40%, 60%, and 80% of MFN rates) apply up to  specified ceilings.  The ceilings are open for 
utilization by all beneficiaries.  However, preferential treatment is suspended on a monthly basis when 
ceilings are reached.  If preferential imports from one beneficiary exceed one-fifth of the total value or volume of the overall ceiling, the preferential treatment  for that beneficiary is suspended. (Para 45, 
page 25, chapter II).  It will be helpful if the au thorities are able to furnish the details on how the 
overall ceilings are prepared. 
 
A. Under Japan's current GSP scheme, which is effective until 31 March 2011, ceilings based on 
Temporary Tariff Measures Law are provided as fo llows:  the limit value or volume for FY2001 was 
established as 103% of the preferential import valu e or volume of a product in FY 1999.  Since 
FY2002, the limit value or volume has been increased  each year by 3% of the previous year's limit. 
 Q19. From the report of the Secretariat it can be understood that the total budget to import 
promotion measures are on the decline.  It is also  stated that Japan has been placing less emphasis on 
measures to import promotion. (Page 46, Para. 62).  It will be helpful if Japan can explain what are th e import promotion measures that exist since the last 
review and what is the phase out plan for them. 
 
A. The import promotion measures by the J apan External Trade Organization (JETRO) and of 
the foreign access zones (FAZs) had already been abolis hed as of the previous review.  Those of the 
MIPRO still remain. WT/TPR/M/211/Add.1 
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  Q20. Non- ad valorem  tariffs for agriculture (WTO definition) for which AVEs were not available 
concerned 93 tariff lines at HS 9-digit level;  they  included milk and dairy products, live swine and 
meat of swine, rice and cereals, fruit juices, and pr epared foods.  For example, the rate payable on 
imports of peas is among the highest in Japan's customs tariff with an ad valorem  equivalent of 
578.6% (out-of-quota rate).  Many of these products  enjoy comparative advantage for the developing 
countries. Japan may kindly explain why they ar e not able to provide AVEs of these tariff lines. 
(Page 72,Chapter IV, Para 10)  
A. Ad valorem equivalents (AVEs) of non-ad valo rem duties are automatically calculated along 
with the duty, import value and volume.  For examp le, the AVE of a specific duty can be calculated 
using the following formula:  "specific duty on an item/(import value/im port quantity)×100 (%)."  
Therefore, AVEs of some tariff lines can not be pr ovided in cases where the re are no imports or de 
minimus imports of the lines for the year. 
 
Q21. The Government implem ents "supply-demand adjustment" measures on rice by setting a 
volume cap for rice production. (Page 74, Para13, Ch apter IV).  What is the criteria followed for 
fixing the production cap of rice and other important pr imary products.  By fixing an artificial level of 
cap in the production of these important primary products Japan distorts the demand supply 
adjustment mechanism of a free market equilibrium .  We would be pleased to have Japan's response 
in this regard.   A. The volume cap for rice production (annual  demand estimate) is calculated by the 
Government based on the recent demand trend.  Th e target volume fro the raw milk supply is 
calculated by a producer group based on the domestic  demand projected by private entities.  The 
supply-demand adjustment for rice and raw milk  is conducted by producers and farmers’ 
organizations based on annual demand estimates and the market trend. 
 
Q22. It may be useful Japan could explain which are the modes of supply (in services trade) that Japanese economy enjoys a comparative advantage?  What are the existing barriers on Mode 2 and 
Mode 4 in services?  
A. The liberalization of all Modes is valuable for the economic development, not only of Japan, 
but also of all Members.  Especially the liberaliza tion of Mode 3, which leads to the development of 
the infrastructure forming the basis of each country's economic activity and the facilitation of 
technology transfer. It also stabilizes financing from abroad, creates employment, and leads to the 
economic growth of importing count ries. Some countries still retain many limitations on Mode 3. 
Japan would like to request those countries to eliminate and relax those restrictions. 
 
With regard to the Japan’s commitments on M ode 2, Japan makes commitments without any 
restrictions in 31 sub-sectors and partially makes co mmitments in 9 sub-sectors out of 55 sub-sectors 
of Collective Request in cross border supply, whic h is deemed as a high level offer.  Commercial 
presence requirements on Mode 2 (especially prof essional services) are rese rved for the purpose of 
consumer protection, such as necessity of prompt action in case of malfeasance including fraud.  
 
There are no requirements for ENT or numerica l ceilings on Japan’s comm itments on Mode 4. 
Commitments on Mode of 4 are based on measures of  immigration laws and regulations.  Information 
on immigration laws is available at the following URL:  http://www.immi-moj.go.jp/english/hourei/index.html 
 
Q23. It is reported that given the aging popula tion of Japan, the demand for medical services is 
going to put pressure on the existing health infrastructur e in the country and this can to some extent be 
relieved by easing rules for movement of trained professionals, nurses, physicians etc from India to Japan.  It may be useful for India if the Japane se authorities could explain why there are continuing  WT/TPR/M/211/Add.1 
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  barriers in Mode 2 (consumption abroad) and Mode 4 (movement of natural persons) with regard to 
the trade in health services.   
A. If medical services are not provided appropr iately, the public will be exposed to serious and 
apparent risks for their lives and bodies.  Because of th e public’s high concern, in order to assure the 
confidence of our nationals for medical servi ces, Japan cannot easily accept Mode 4. 
As for Mode 2, Japan believes there is no barrier. 
 
Q24. It would be highly beneficial if Japan could provide data with regard to the import of Mode 2 
(consumption abroad) health services. 
 
A. There is no data on the import of Mode 2 health services. 
 
Q25. The Japanese authorities may please clarify how many items are subjected to import quota and under import license. 
 
A. As of February 1, 2009, among the items restricted by the Foreign Exchange and Foreign 
Trade Act, the number of items prescribed by the HS  classification (Four digit base) are as follows: 
 - Items subjected to import quota: 8 (marine products) - Items under import license: 51 (medicines and ch emical products, weapons , nuclear material, 
and so on) 
 In addition, there are items not prescribed by the HS classification, which are the substances listed in 
the Annex of the Montreal Protocol on Substances that Deplete the Ozone Layer and the animals and 
the plants listed in the Appendix of the Convention on International Trade in Endangered Species of 
Wild Fauna and Flora as well as their parts and derivatives.  
Q26. Procurement under the basic guidelines must be \500 million or less per contract. Any planned procurement exceeding this threshold must be separated or divided.  The authorities expect 
these measures to improve transpar ency in Japan's procurement pr ocess.  Japan may please explain 
how the procurement threshold level is fixed. 
 
A. The target of the guidelines is informa tion systems development procurement to cost 
800,000 SDR or more (¥140 million as of January 2009)  per contract.  The guidelines describe that 
information systems with an estimated designing a nd developing cost of ¥500 million or more are to 
be the target of separating or dividing procurement. 
 
Japan is promoting the optimization of its busin ess and information systems. Ministries have created 
optimization plans for this purpose.  Generally sp eaking, the cost of designing and developing an 
information system is 4 or 5 times that of its op erating cost.  Japan decided this threshold to cover 
procurement regarding optimization plans which a re created for information systems that need 
100 million yen or more as an annual operating cost. 
 
Q27. It may be useful if the Japanese Authorities ar e able to provide the details of export promotion 
scheme like subsidies, export finance, insurance, a nd guarantees etc-(Para73 pa ge 55).  Similar details 
of export credit will also be useful.  A. In regard to export promotion schemes, J apan provides export credits based on the terms and 
condition of the OECD arrangement on officiall y supported export credit.  In regard to export 
finance, please refer to the Japan Bank for International Cooperation (JBIC) website 
(http://www.jbic.go.jp/en/finance/export/index.html). In  regard to export insurance, please refer to the WT/TPR/M/211/Add.1 
Page 150  
 
  Nippon Export and Investment Insurance (NEXI) we bsite (http://www.nexi.go.jp/e/ps/index2_ 
frame.html). 
 
Q28. Japan is a net food importer from the worl d and self-sufficiency in Japan is just 40%.  
However, still India's agricultural exports to Japan ar e not very high.  This is attributed to various 
restrictions imposed by Japan. Indian tea, rice a nd wheat producers say that Japan imposes very strict 
regulations with regard to pesticide and chemical residues in these items.  Similarly, meat and meat 
products exports to Japan face difficulties on account of stipulations that ban use of natural and 
synthetic hormones in livestock production.  Indi a would appreciate to be  informed if these SPS 
requirements are science-based and aligned which specific international standards? 
 
A. Japan's positive list system fo r the regulation of agricultural chemicals (pesticides, veterinary 
drugs including hormones, and feed additives) has been introduced fo r the protection of consumer 
health, based on scientific and technical considerations.  This regulation is equally applied to all food 
items, without distinction between  domestic and imported products.  
 
Maximum residue limits (MRLs) established in the process of implementing the system are based on 
Codex standards and other legitimate international standards.  At each stage of consideration of 
MRLs, Japan has published draft documents and sought comments fr om inside and outside the 
country.  Japan notified the WTO of these documents  as G/SPS/N/JPN/145, in accordance with the 
WTO/SPS Agreement.  Following this procedure, Japan has given detailed explanations about the 
system to foreign countries before and aft er implementation of the regulation.  
 Given the scientific validity of the system and in ternational harmonizati on of Japan's standards, 
Japan does not believe that the regulation system has  created any trade barriers.  Japan would like to 
ask Indian competent authorities to help domestic  producers and distributors of foods ensure their 
products comply with Japan’s standards.  
 Regarding "natural and synthetic hormones," it is not clear what individual substances are being 
referred to. Japan's regulations allow for residue  level occurring in nature for Estradiol 17 β, 
Progesterone and Testosterone.  For Trenbolone ac etate, Melengestrol acetate and Zeranol, which 
are synthetic hormones, Japan provides MRLs. 
 
If the Indian agricultural industry has any requ est for addition of MRLs for other substances than 
these compounds or any other revision of the current standard, please contact with the Ministry of 
Health, Labor and Welfare (MHLW) of Japan throu gh the Indian Embassy in Tokyo.  The MHLW has 
drawn up a guidance procedure for requesting required data sets.  
 
Q29. Although rice apparently is the most impor tant commodity, the quantum of the subsidies 
provided for rice was not made available to the Secretariat.  Japan may explain the reasons for not providing the details to the Secretariat.  It would be  useful if Japan can explain how the subsidies that 
are provided to various other food crops are not trade distortive.  A. The details of domestic support for all relev ant food crops are notified to the Secretariat in 
accordance with the agreed format.  As for the details of domestic support for rice in Japan, please 
refer to the relevant notifications (G/AG/N/JPN/137) .  Among the various support programs, we think 
that the ones notified as Green Box are not trade di stortive as they meet the criteria provided in 
Annex 2 of the Agreement on Agriculture. 
 
Q30. In-quota imports of rice, wheat and barley, and certain milk products are handled mainly by state-trading entities.  However, certain amounts of these products may be imported by private 
entities.  It may be helpful if the authorities can explain the intention in providing the import right of 
these important commodities to state trading author ities in which the developing countries have a  WT/TPR/M/211/Add.1 
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  comparative advantage.  How much quantum of them  can be handled by the private entities and what 
is the criterion of division?  
A. Almost the entire volume of rice, wheat, barley and a certain portion of dairy products are 
imported through state trading.  The annual import q uota for dairy products for private entities is set 
to approximately 1,539,000 tons (raw milk equivale nt).  These treatments, including the volume of 
quotas allotted to the private entities, are in line with Japan's schedule. 
 
Q31. Japan was the 3rd largest trade partner of India in 1990-91 (8.30% of India's total trade).  By 2000-2001 Japan became the 5th trading partner of India (3.82).  By 2006-07 Japan is no where 
among the top 10 trading partners of India.(DGCIS ,2007).  What are the possible reasons for this 
steady decline in Japan-Indi a trade?  What steps does Japan envisag e it will take to regain the market 
position it previously enjoyed in India?  
A. As the Japanese economy entered in to a dec ade-long recession triggered by the collapse of 
the bubble economy in the 1990s, the increase in trade between Japan and India during the times 
mentioned was accordingly sluggish compared with that of trade between India and the rest of the 
world.  Although the trade volume between Indi a and Japan has increased threefold during the past 
couple of decades, the trade volume between Indi a and the rest of the world has increased 9.6 times, 
thus resulting in a relative decline in  the percentage of Japan-India trade. 
 
It may be said that Japan and India, which boast the largest and 3rd largest economies in Asia 
respectively, have not been able to  make full use of their potentia l. However, the Japanese business 
community's interest in India has sharply risen in recent years.  According to Japanese statistics, the 
trade volume between Japan and India reached US$10.3 billion in 2007, which represents an 
increase of approximately 22% from the previous year.  Also in 2007, the amount of Japanese foreign 
direct investment (FDI) in India was ¥17.82 billion,  which equates to a threefold increase from the 
previous year.  As of October 2008, 840 branc h offices of Japanese companies were operating in 
India.  Three years ago, less than half that number were doing so.  Japan and India share the same views on the impor tance of further deepening bilateral economic 
relations.  Both governments are working towards the earliest possible conclusion of the highly 
valued and mutually beneficial Economic Partnership  Agreement, the improvem ent of infrastructure 
for facilitating Japanese private sector investment in India, and the development of human resources 
in India's manufacturing industry.  Japan will work steadily and closely with the government of India, 
in line with the recommendations submitted by Japanese and Indian business leaders advocating the 
further strengthening of bilateral economic relations , which were made on the occasion of the visit to 
Japan in October 2008 by the Prime Minister of India, Dr. Manmohan Singh.   
Q32. Japan's pharma market is around US$60 billion.   Out of which around US$10 billion is being 
imported.  But for the developing countries access to  Japans' market is nearly non-existent due to 
Non- tariff barriers.  Besides the secretariat report (Para 34, Page 32, Chapter III) points out that some 
items in this category need conformation at cust oms as these items come under import surveillance.  
Japan may please explain what are the possibilities fo r reforms in this area to assist pharma industry 
of developing countries to export to Japan?  
A. Japan considers it inappropriate to reform this  area solely for export facilitation from 
developing countries, since pharmaceutical regulations  are implemented in order to safeguard public 
health in Japan.  
Q33. Products of the "alternative medical system" (e .g. Ayurveda, Unani, etc.) are in high demand 
in Japan.  What is the procedure for import of these items in Japan? 
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Page 152  
 
  A. If "products of the 'alternative medica l system' (e.g. Ayurveda, Unani, etc.) fall under 
categories of regulated products in the Pharmaceu tical Affairs Law (pharmaceuticals, quasi-drugs, 
cosmetics and medical devices), the Law is  applied to the procedure for import. 
 
Q34. For import of cosmetics products, Japan requires obtaining a license from the Ministry of 
Health and Welfare.  The ministry uses a pre-define d list of items that can be used as ingredients in 
the production of these products which act as barriers.  Why manufacturers are not given the freedom to choose the ingredients as long as the ingredients chosen are safe for hum an use? Japan may please 
inform what steps are being considered in this regard.  A. For preservatives, UV absorbers and tar colors,  the use of unapproved ingredients is 
prohibited.  There are also restrictions for the use of approved ingredients. 
 Regarding cosmetic ingredients other than preserva tives, UV absorbers and tar colors, manufacturers 
can freely choose and use ingredients if the sa fety of the ingredients is confirmed. 
 
For further details, please refer to the we bsite on the Standards for Cosmetics: 
http://www.mhlw.go.jp/english/topics/cosmetics/index.html 
 
Q35. Indian companies face barriers in the sector s like pharmaceuticals in the form of the practice 
of the requirement of partnering with Japanese en terprise/trading houses for local marketing.  This 
escalates costs for the Indian manufacturers as they do not have a product profile at the beginning. 
What are the steps proposed to be taken by th e Japanese authorities to resolve this problem?  
 
A. In order to market medical products such as pharmaceuticals and medical devices in Japan, 
it is necessary to obtain licenses to ensure quality  and safety under the Pharmaceutical Affairs Law 
("PAL").  A minimum requirement for the acquisition of such licenses is comp liance with the various 
standards of PAL. It is not possible to mitigate these requirements for a specific exporting country’s 
sake, as they are in place to safeguard the safety of public health. 
 
Q36. Pharmaceutical export compan ies are expected to keep an inventory of product for five years 
which result in huge losses afterwards.  More over the exporting companies feel that mandatory bio 
equivalence testing on the Japanese population fo r each generic product also increases the cost 
tremendously.  Although Japanese law allows for generic medicine substitution, in practice doctors do 
not prescribe substitution drugs.  By when is the Japanese government considering reforms in these 
areas to get the best generic products at a lo w price for the benefit of Japanese patients? 
 A. The government plans to expand the share of generic medicine in the pharmaceutical sector 
up to more than 30% by the year 2012.  To reach the 30% target share by 2012, the Ministry of 
Health, Labour and Welfare has proposed an "Action pr ogram for generic medicine."  This program 
is a work plan for both the government and for the industry, one which aims to enable generic medicine to be used by patients and the hea lth care professionals with confidence.  Unless the 
prescription carries a prescri ber's signature in a column entitled, "Dispense As Written," the patient, 
by request, can receive generic medici ne as a substitution at a pharmacy. 
 With generic medicine, it is necessary to keep an inve ntory of a product for at least five years in order 
to maintain a stable supply.  Bio equivalence tes ting for each generic product is essential for assuring 
therapeutic equivalence. 
 
Q37. Websites, linkages to websites and information related to Pharmaceutical imports are all in Japanese language.  What are the st eps proposed to be taken by the Japanese authorities to solve this 
problem by making available vital info rmation available in English language? 
  WT/TPR/M/211/Add.1 
 Page 153 
 
 
  A. The Pharmaceuticals and Medical Devic es Agency’s (PMDA) website has related 
information in English.  The PMDA continues its effort to make related information available in 
English. English books on pharmaceutical re gulations have already been published. 
For details, please consult the PMDA website:  http://www.pmda.go.jp/english/index.html 
 Q38-1. Japan imposes strict quotas for import of items like squids, seaweed, mackerel, sardine, 
herring etc.  A number of vitamins and products c ontaining vitamins are treated as food products and 
are accordingly subjected to stringent SPS measures.  What is the justification for such a treatment? 
 
A. The IQ system plays an important role in the conservation and management of fishery 
resources in waters adjacent to J apan.  This system is consistent with WTO Agreements.  Japan will 
continue to implement this system in an appropriate manner. 
 
Q38-2. What are the Japanese Government plan s to initiate time bound reforms in these areas? 
 A. The Food Sanitation Law defin es food additives as substances u sed in or on food in the 
process of manufacturing the food, or substances used for the purpose of processing or preserving 
food.  The Law regulates the manufacturing, distribution,  and usage of food additives to prevent adverse 
health effects caused by their impurities or cont aminants which have arisen in the manufacturing 
process. 
 Vitamins added to food for maintaining or improv ing nutritional qualities meet the definition of food 
additives, and therefore shall be regulated in the same manner as additives under the Food Sanitation 
Law. 
 
Japan recognizes that not only Japan but also other countries, such as the EU and the United States, have similar regulations on vitamins. 
 
Q39. The rules governing imports of fruits and vege tables into Japan are excessively restrictive and 
at times stricter than those applicable in other deve loped nations.  What is the justification for such a 
treatment? 
 
A. Inspection measures for imported agricultu ral products under the Japanese Food Sanitation 
Law are conducted based on the compliance histories of those products and monitoring inspection results at import and control measures for agricultu ral chemicals carried out on the export country's 
side.  
 In regard to plant quarantine measures, in order to prevent introduction of pests foreign to Japan that 
could cause serious damage to Japanese agricu lture, Japan takes plant quarantine measures based 
on scientific evidence, in accordance with the WTO/SPS Agreement, the International Plant 
Protection Convention (IPPC) and relevant inter national standards established by the IPPC. 
 
Q40. In case of processed food items, the presence of additives used for preservation or enhancing 
the product quality and life and otherwise considered  safe are objected to by authorities in Japan. 
What is the justification for such a treatment?   A. In Japan, food additives are not permitted fo r use unless they are designated by the Minister 
of Health, Labour and Welfare as substances which are unlikely to cause adverse health effects.  
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Page 154  
 
  To ensure food safety, every new food additive is author ized only after a risk a ssessment, even if it is 
used in other countries.  Japan recognizes that not only Japan but also other countries, such as the EU and United States, have similar regulations. 
 
Q41. Withholding tax is a major issue in service exports to Japan.  Indian IT service companies 
have complained about the 15% withholding tax imposed by Japanese authorities on payments from 
Japanese firms to the Indian IT service compan ies labeling the same as 'fees for technical 
consultancy'.  What are the plans to repeal this tax?  
A. When a Japanese company entrusts software development to an Indian IT service company, 
according to the provisions concerning royalties a nd fees for technical services of the tax treaty 
between India and Japan (paragrap h 2 of Article 12), fees paid by the Japanese company for the 
software development may be taxed in Japan, Japan being the source country of the payments.  With 
regard to this provision of the treaty, in the c ourse of negotiation, the Indian delegation strongly 
insisted on leaving the provisi on unchanged while the Japanese delega tion requested its deletion, and 
as a result, it was determined to reduce the tax rate from 20% to 10%. Japan understands that both 
sides reached a mutual understanding concerning ta xation on fees for technical services (including 
software development) in the pr otocol amending the tax treaty. 
 
Q42. Obtaining visa's for employees to do on-site work in Japan is a problem faced especially by 
companies in the IT sector.  What steps Japan  propose to take to mitigate this problem? 
 
A. The nature of the 'problem' mentioned in the question is not specific but ambiguous.  First of 
all, Japan is promoting the acceptance of IT E ngineers from abroad und er the 'e-Japan Priority 
Policy Program.'   
The Criteria for the Status of Residence of ‘E ngineer’ was partially amended in December 2001 to 
ease the standards for accepting IT engineers from  abroad.  Namely, foreign nationals who have 
passed foreign examinations or ob tained qualifications on inform ation processing skills, which are 
mutually certified by Japanese IT-related examinations  or qualifications and are designated by the 
Minister of Justice in the Officia l Gazette, may enter Japan irrespective of whether or not they satisfy 
the criteria for landing permission for 'Engineer', i.e.  having graduated from or completed a course at 
a college or acquired equivalent education, or having at least 10  years' work experience in the field. 
 An 'Engineer' visa may be issued  within five working days upon bona fide application, in the case that 
the aforementioned eased requirements are fulfilled,  at Japanese Embassies/Consulates, to a foreign 
IT engineer who holds a 'Certificate of Eligibility' and is employed by an IT company in Japan. 
 
In the case that an IT engineer employed by a fo reign based company makes a short term business 
trip in order to install or ma intain machines/systems in Japan, a 'Temporary visitor visa' may be 
issued within five working days upon bona fide a pplication.  If such an engineer meets certain 
requirements, multiple entry visa can be issued. 
 
 
THE SEPARATE CUSTOMS TERRITORY OF TAIWAN, PENGHU, KINMEN AND  
MATSU (CHINESE TAIPEI)  
 
Q1.2. (page 1, Table I.1, page 4 paragraph 5 & page  5 paragraph 10) 
 1) In this context, we would like to know whether the Japanese government is thinking of 
adjusting the above goal, and if so, to what extent?  
  WT/TPR/M/211/Add.1 
 Page 155 
 
 
  A. Ensuring the prevention of a surge of public debt  (the ratio of debt of the central and local 
government to GDP) as well as the steady reduction of that debt is an extremely important criterion. 
Japan will carry out disciplined economic and fiscal management with an aim to achieve the important objectives by the mid-2010s. 
 
2) Considering the fact that Japan faces the acute  fiscal situation of a ra pidly aging population, 
which requires escalating expenditure on healthcare and pensions now and in the future, if it is still to 
maintain the above-mentioned goal, what measures is Japan taking to retain the momentum of 
financial reform?  
A. In regard to efforts being made for the rest oration of fiscal health, Japan will take following 
measures:  
1) Japan will maintain the areas of budget allocation responding to the economic and social 
changes, and continue the existing expenditure reform. 
2) Japan will carry out a fundamental reform of the tax system, including the consumption tax, 
as stated in the "Mid-Term Program" (appro ved in the Cabinet meeting on December 24, 
2008) 
3) Japan will focus on a strategy for economic gr owth that alleviates future public burden and 
supports the economy as well as achieves mid- and long-term economic growth. 
 
Q3. (page 16, paragraph 8) 
 
Could Japan please advise us of whether it intends  to join the "Trans-Pacific Strategic Economic 
Partnership Agreement" between New Zealand, Chil e, Singapore and Brunei, and of its rationale for 
joining or not joining, whichever is the case?  A. Japan has deep interest in this initiative.  Japan will seriously examine the possibility of 
engaging in this initiative in line with exis ting policy on possible EPAs in the future.  
 
Q4. (pages 21-27, paragraphs 18-44)  Could Japan please describe for us how it has work ed to achieve a balance between the multilateral 
negotiations under way in the Doha Round and the various regional trade agreements that it has 
signed, or is negotiating, without the complica tion of the so-called "spaghetti bowl effect" on the 
world trading system?  
A. Japan considers the maintenance and strengtheni ng of the multilateral free trade system 
under the WTO to be the core of its external economic  policy.  From this position, Japan promotes its 
regional and bilateral trade policies through ec onomic partnership agreements (EPAs) intended to 
complement the multilateral free trade system.   It is inevitable that the level of complication in creases as entry into force of the EPAs progress, since 
the rules applied for specific goods are different among EPAs due to the results of each negotiation.  
However, Japan makes every effort to  make agreements much easier to use by trying to adopt similar 
rules between EPAs and avoiding complication among respective rules to the g reatest extent possible. 
 
Q5.6.7. (page 22, paragraph 22 & page 25, paragraph 37)   
1) What is Japan's position and strategy on the resumption of the Japan – Korea FTA and on the 
possible trilateral FTA between Japan, Korea and China?  
2) Does Japan make any priority between the two FTAs?  3) How can a balance be struck between the two FTAs? WT/TPR/M/211/Add.1 
Page 156  
 
  A.1. The Japan-Korea FTA 
 At a bilateral summit meeting in October 2003, Japan  and Korea agreed to launch negotiations for a 
Japan - Korea Economic Partnership Agreement ( EPA).  Six rounds of negotiations were held 
between December 2003 and November 2004, when ne gotiations were suspended.  At a summit 
meeting in April 2008, the leaders of the two c ountries reconfirmed the importance of the bilateral 
EPA and agreed to hold working level consultations in June for the resumption of negotiations.  The 
leaders of the two nations also agreed to furth er advance joint consideration towards Japan – Korea 
EPA negotiations at a bilateral summit meeting in January 2009.  
Japan considers the conclusion of the Japan – Kore a EPA as important not only for strengthening 
bilateral relationship but also for prom oting economic partnerships in East Asia. 
 Japan and Korea held working-level consultation mee tings in June and December 2008.  Japan hopes 
that the consultation meetings will lead to  an early resumption of the negotiations. 
 
2. The possible trilateral FTA between Japan, Korea and China   Japan attaches importance to the enhancement of ec onomic relations with Asian countries including 
Korea and China.  To this end, Japan continues to monitor carefully the Trilateral Joint Studies for a 
possible FTA among Japan, China and Korea, which are conducted by experts from each country. 
 
The Japan-Korea EPA and the trilateral FTA among the three countries are at different stages of 
development.  Official negotiations between J apan and Korea on the EPAs have already begun, 
whereas the trilateral FTA is still in the stage of joint studies by represen tative institutes.  The 
relationship between these two FTAs is being cons idered within the joint study on the trilateral FTA 
conducted by private institutes.  If it is found to be  necessary, the relationship will also be studied at 
the governmental level at an appropriate time. 
 
Q8. (page 33, paragraph 13)  Could Japan please explain why its Customs only measures the time until the release of the goods, 
and does not measure the time between the arrival of  goods and the importer's claim for the goods and 
removal of the goods?  
A. In Japan, it is customary to keep goods in a hozei area after an import permit is issued by 
Customs.  A hozei area is not only the place for customs clearance but also a distribution base.  The 
time of removal of the goods is decided by the ow ner, so Customs does not measure the time between 
the arrival of goods and the removal of the goods.  Customs has conducted the survey in the same way si nce 1991 so as to retain the continuity of the 
survey. 
 Q 9.10. (page 34, paragraph 16) 
 1) If the Common Portal for the Next Genera tion Single Window has already been introduced, 
could Japan please provide details on how it works and which agencies are involved? 
 A. Japan Customs has been developing a Single Wi ndow system in Japan, in which information 
and communication technology can be used in co- operative arrangements between Customs and other 
border agencies (Ministry of Justice;  Ministry of  Land, Infrastructure and Transport;  Ministry of 
Agriculture, Forestry and Fisheries;  Ministry of Economic, Trade, and Industry;  Ministry of Health, Labor and Welfare) to enable all the parties in  an import/export and vessel clearance transaction to  WT/TPR/M/211/Add.1 
 Page 157 
 
 
  use a Single Electronic Window.  Through this wi ndow, relevant official boarder agencies can share 
prescribed control data and provide traders in a streamlined "one stop shop" release/clearance 
processing system.  The border agencies concerned have been jointly developing the Common Portal, which is the portal 
for the "Single Window," which was introduced in October 2008.  
2) If the Portal includes the issuance and transmis sion of electronic certificates of origin (eCOs), 
with a view to further facilitating trade, we would be interested in Japan's views on the subject of cross-border eCO exchanges with major trade partne rs.  The issuance and transmission of electronic 
certificates of origin (eCOs) are not included in the Single Window System (common portal).  
However, organizations in charge of the issuance a nd acceptance of certificates of origin (the Ministry 
of Economy, Trade and Industry and Japan Cust oms) have started to examine the possible 
introduction eCOs recently.  A. The portal has unified applicant ID systems,  electronic application processes and data input 
processes, all of which previously had different sp ecifications among the agencies concerned.  The 
portal has also enabled data-sharing among the agen cies concerned, and helped applicants to save 
work by allowing them to reuse basic informa tion they have submitted to the Common Portal.  
Furthermore, these highly convenient services a re provided through a user-friendly interface. 
 Q11.12. (page 56, paragraph 82) 
 1) Is there any dominant regulation that preven ts these Public Corporations from impeding 
market competition ?  A. Japan holds a certain number of shares in NTT.  NTT has been privatized and is in no way a 
"Public Corporation."  That said, in the telecommunications market, where NTT demonstrates significant market power, 
Japan has been introducing mainly dominant regulations based on the Designated Telecommunications Facilities System against dominant service provider. 
 
Through this system, Japan regulat es NTT West/East as "Category I designated telecommunications 
facilities," applying service regulations, behavior regulations, and regulations related to 
interconnection.  Japan also regulates the NTT Docomo group as "Category II designated 
telecommunications facilities. 
 
At the same time, Japan tries to ensure fair competition and the effectiveness of the Designated 
Telecommunications Facilities System through measures such as the "Direction concerning 
promoting competition in the teleco mmunications sector".  "The fair  competitive guideline is related 
to the business enlargement of NTT East and West ."  Japan also introduced a competition safeguard 
system in 2007 in order to systematically organi ze and regularly review requirements for fair 
competition. 
 There is no dominant regulation that prevents Japan Petroleum Exploration Co. Ltd. from impeding 
market competition.  
There are no non-competing regulations between financial institutions that have received public 
funding and those that have not.  In regard to tobacco related businesses, in Japan, im portation, wholesale or retail sale are allowed 
for any person provided that the person registers th e specific sale of imported manufactured tobacco WT/TPR/M/211/Add.1 
Page 158  
 
  on their own for the wholesale of manufactured toba cco, or obtains permission for the retail sale of 
manufactured tobacco, in accordance wi th the Tobacco Business Law.   
 
2) Is it planned to set a privatization sche dule for public Corporation in the future ? 
 A. There are no plans to set a new privatiza tion schedule for Public Corporations.  The 
Government of Japan will continue to implem ent the Reorganization and Rationalization Plan for 
Public Corporations adopted in December 2001. 
 
Q13. (Page 79, paragraph 27) 
 
The authorities do not currently plan to liberalize furt her the retail market for electricity.  What are the 
concerns of the Japanese authorities?  In the future , is it possible to expand the scope of liberalization 
to include 50kW or less for consumer use?  A. Since the implementation of partial libera lization, the share of PPS (power producer and 
supplier) in electric power sales in  the liberalized sector has been increasing, but it remained at about 
2.35% as of November 2008.  There are several rea sons for the stagnation of the PPS share. 
According to the survey of large industrial customer s, they are generally sa tisfied with their present 
contracts.  Additionally, electricity providers ot her than local general power utilities have failed to 
provide sufficient information for comparison or  consideration to become alternative options. 
 
As a result, it cannot be said that customers in the liberalized sector have adequate choice.  Therefore 
the preconditions for expanding the scope of liberaliza tion of the electricity retail market are not yet 
readied.   
After the implementation of system reforms to develop the environment for competition in the 
liberalized market, and after a certain period of time (somewhere around 2013), the status of customers' choice and other conditions in the liberalized  market will be reviewed.  And on the basis of 
the results, whether the scope fo r liberalization of the electricity retail market should be expanded 
will be considered again. 
 Q14. (Page 80, paragraph 30) 
 Could Japan please provide further information on this case to us and other WTO Members as a reference for future investor s in electric and gas utilities? 
 A. Based on the Foreign Exchange and Fo reign Trade Act (FEFTA), Japan reviewed a 
notification submitted by a foreign investor on 15 Jan uary, 2008 regarding a pl anned investment to a 
wholesale electric power company.  After a thor ough review, it was determined that, if the investment 
was implemented, there was a possibility of it having an adverse effect on the construction and 
operations of nuclear power plants under constructi on at the time and, consequently, on the stable 
supply of electric power and nuclear  and nuclear fuel-cycle policies.  Thus, Japan recommended that 
the foreign investor discontinue the planned invest ment on 16 April 2008.  Since the foreign investor 
refused to accept the recommendation on 25 April 2008, Japan orders for the foreign investor to 
discontinue the planned investment on 13 May 13 2008.  
 
Q15. (page 88, paragraph 52) 
 
Could Japan please provide more information on tariff regulations, in particular regulatory measures 
on leased-circuit fees and Internet service providers' (ISPs) peering fees, which aim at ensuring fair competition between new common carriers (NCCs) a nd NTT, as well as between Internet access 
providers (IAPs) and NTT?  WT/TPR/M/211/Add.1 
 Page 159 
 
 
  A. The meaning of "tariff regulations" here is not  clear in this context, but regarding the fees 
indicated in the question, the leased-circuit and in terconnection fees are stipulated in the reference 
interconnection offers which are submitted by the do minant carriers to obtain authorization from the 
Minister for Internal Affairs and Communication an d then made public.  Concerning tariff policies, 
Japan has been adopting the price cap system for telephone subscription fees offered by NTT East 
and NTT West since FY 2000.  Japan does not appl y particular measures for ISP's peering fees. 
 Japan is now further promoting competition by u ndertaking reviews of calculation methods for 
interconnection charges, dominant regulations, and tariff policies based on the New Competition 
Promotion Program 2010, a r oadmap of measures to be implemented by the early 2010s. 
 
Release of New Competition Prom otion Program 2010, Progress Report (Primary) is posted at 
http://www.soumu.go.jp/joho_tsusin/eng/Rele ases/Telecommunications/news071023_2.html. 
 
Q16.17. (Page 91, paragraph 63) 
 
1) We wonder whether the tonnage tax runs counter to the fairness principle of taxation, and we 
would appreciate knowing how the Transport au thority convinced the Revenue authority? 
 
A. In order to level tax regime with other c ountries as well as to strengthen international 
competitiveness of Japanese-flagged vessels and J apanese seafarers, Japan has introduced the 
tonnage tax.  
2) In addition, could Japan please provide details of the regulations relating to the tonnage-tax 
and application requirements, as well as othe r related regulations, for our reference? 
 A. 1. Outline of the tonnage tax  A shipping company may calculate and pay its cor porate tax upon the assumed profit per net tonnage 
of Japanese flagged vessels for international trade operated by the company provided that the 
company obtains approval of the Minister of L and, Infrastructure, Trans port and Tourism (MLIT). 
 
2. How to calculate the amount of taxation 
 1) If (i) exceeds (ii), then the difference is calculated as a loss,  and if (ii) exceeds (i), then the 
difference is calculated as a profit 
 (i) The actual income of shipping business gained from Japanese flagged vessels 
 (ii) The profits calculated from the follo wing formula:  The assumed profit per 100 net 
tonnage per day * the number of net tonnage * days of operations 
2) The level of the assumed profit will be set  taking into account those of other countries 
 3. The period of tax application  
1) The deadline of application of the plan: From the day of the entry into force of the amended 
law to March 31, 2010 
2) The period of tax application:  Five years from the first accounting year that starts after the 
plan has been approved.  When the final year of  the plan comes, MLIT will assess the plan 
performance, and may re-approve the plan for n ext five years. (Total: Ten accounting years) 
 
Q18. (Page 93, paragraph 75)  Is there is any specific qualification regard ing nationality or residence required of the 
above-mentioned professionals for them to be able to join any of these professional associations?  WT/TPR/M/211/Add.1 
Page 160  
 
  A. There is no specific qualification regarding nationality for membership to relevant 
professional associations, which are required for certified public accountants certified administrative 
procedures specialists, registered foreign la wyers judicial scriveners, land and house surveyors, 
certified public tax accountants, and public consultant on social and labor insurance/patent attorney. 
 
The conditions of residence are as follows: 
 Certified Public Accountants There is no specific qualification regarding residence required to join the Japanese Institute of 
Certified Public Accountants. 
 
Administrative Scriveners  There is no specific qualification regarding residence required to join the national association for administrative scriveners.  
Lawyers  
Residence is required to be recognized as a registe red foreign lawyer by the Minister of Justice. In 
addition, a registered foreign lawyer is required to stay in Japan not less than 180 days in a year. 
 Judicial Scriveners There is no specific qualification regarding reside nce required to join the association but a 
professional must establish an office in Japan. 
 Land and House Surveyors There is no specific qualification regarding residence to join the association, but a professional must 
establish an office in Japan. 
 
Certified Public Tax Accountant There is no specific qualification regarding reside nce required to join the association but a 
professional must establish an office in Japan.  Public Consultants on Social and Labor Insurance 
For membership into the association, a foreign professional has to submit to the association his/her 
"Certificate of Registered Matters" provided for in th e Alien Registration Law, which will be issued at 
the request of a foreign national who has registered at  the municipal office of the city, town or village 
in which his/her residence is located.   
Patent Attorney 
There is no qualification regarding residence required to  join the Japan Patent Attorneys Association. 
 
Q19. (Page 7, paragraph 13)  Is Japan intending to revise any of its Foreign Di rect Investment regulations in any of the areas 
covered by the aforementioned recommendations? If so, could Japan please indicate to us what are the 
key points of the revision?   
A. In order to conduct comprehensive reviews on a desirable form of Foreign Direct Investment 
regulations, the Cabinet Office and relevant minist ries held a director general level meeting in 
December 2008.  Since then, Japan has been c ontinuing comprehensive reviews on an appropriate 
form of Foreign Direct Investment regulations as an exception to the principle of non-discrimination between domestic and foreign investors. As of toda y, the meeting has not yet reached any concrete 
conclusion.  WT/TPR/M/211/Add.1 
 Page 161 
 
 
  COLOMBIA  
 
Q1-1. What, exactly, is the sector-by-sector pr oductivity improvement programme, and what sectors 
does it target? 
A. The Cabinet Office analyzed issues which are necessary to overcome in order to improve 
productivity of some important industries of whic h the service industry was the main.  As a result, 
industry productivity was found to be affected by firm size, introduction of information technology, 
regulation and globalization.  In addition, at the open hearing on producti vity improvement, the 
following tasks were pointed out: revision of regulation and commercial practices, transparency of 
trade, standardization of format, application of  information technology and organizational reform 
through the use of supply chain management, sy stematic analysis and design on business processes, 
international cooperation, academic-industry allia nce and alliance between various industries, 
development of human resources.  By sharing these common views, the sector-by-sector productivity 
improvement program viewed various policies on main sectors supervised by the authorities. 
 
In addition to the issues pointed out in the "Eco nomic and Fiscal Reform 2007," from the aspect of 
productivity and its growth rate by sector, the ratio  of the number of persons engaged in the sector, 
the sector’s importance in terms of social infrastr ucture, the following eight industries are targeted. 
 Information technology 
Telecommunication, broadcasting and contents 
Construction, housing and real estate Lodging and travel Retailing Food production 
Logistics 
Personnel services  The Ministry of Economy, Trade and Industry (METI )'s Industrial Structure Council also proposed a 
sector-by-sector productivity impro vement program in eleven service sectors.  Excluding two sectors 
which are included in the sector-by-sector producti vity improvement program, such as information 
technology, which corresponds to software and info rmation service in the METI's program, and 
retail, we raise nine industries are listed below.  Research and development services Authentication services 
Plant engineering 
Plant maintenance General trading companies Personal services Business process outsourcing Environment equipment servicing 
Automobile sales  
 Q1-2. What are the "super special zones" for developing cutting-edge medical care?  
Q1-3. Does medical care in the super special zon es include imported products, or is it directed 
towards Japanese products destined for th e local market and/or exportation? 
 Q1-4. How many super special zones would there be and where will they be located? 
 WT/TPR/M/211/Add.1 
Page 162  
 
  A. 
- In order to overcome any impediment to th e development of innovative technologies, Japan 
has established a "Super Special Consortia," where in tegral and efficient adm inistration of research 
funds and discussions with regulatory authorities at the early stages of development are experimentally implemented. 
- The special zone is not a usual special zone based on certain administrative area.  Rather, the 
consortia are characterized by the composition of special zones established for the purpose of 
promoting efficient development of relevant resea rches by connecting researchers who study in a 
similar field but reside in different locations. - In FY2008, Japan for the first time establishe d the "Super Special Consortia to support the 
development of cutting-edge medical care" in or der to promote cutting-edge regenerative medical 
care and the development of drugs and medical devices.  - In November 2008, we adopted 24 projects. 
 Q2. What is Japan's experience in developing th e "procedure for regulatory impact analysis" with 
other countries, particularly developing countries like Colombia?  What would be the procedure for 
obtaining information concerning this analysis?  
A. 1. The Ministry of Internal Affairs and Telecommunications (MIC) had conducted a study group 
in order to organize what elements the Government  of Japan should consid er when conducting the 
ex-ante evaluation.  In addition, each adminis trative organ had been conducting RIA experimentally 
in order to develop evaluation method.  Thereafter,  the MIC drew up "Implementation Guidelines for 
ex-ante Evaluation of Regulations" that provide standard guidance for what kind of analysis should 
be conducted, what procedures ar e necessary and other related matters to ex-ante evaluation of 
regulations for its smooth and efficient implem entation.  Based on these actions, the ex-ante 
evaluation has become obligatory since October 2007. 
 If Colombia could provide Japan with the current status of policy evaluation system in Colombia, 
Japan would be ready to give advices. 
 
2. Each administrative organ conducts ex-ante evaluation of regulations and publicizes the 
evaluation reports that are m ade public in its own website. 
 For more information on the "Implementation Gu idelines for ex-ante Evaluation of Regulations," 
please refer to the following webs ite, which is written in English. 
http://www.soumu.go.jp/hyouka/seisaku_n/pes/implementation.pdf 
 
Q3-1. What is an integrated hozei area?  What  import duties or charges of any other kind are 
imposed on goods stored in these areas?  What incen tives are granted to firms located in these areas?  
How is compliance with the TRIPS rules monitored in these areas? 
 
An Integrated hozei area is a portion of land, building or other facility approved by the Director 
General of Customs in which all types of func tions, such as loading and unloading, transport, 
long-term storage, processing/m anufacturing and the exhibition of foreign goods are carried out. 
 There are no import duties or charges of any other kind imposed on goods stored in these area. 
 
In our view, it is not prohibite d under the TRIPS Agreement for cust oms authority to seize infringed 
goods stored in a hozei area.  Japan believes that th e monitoring of such goods by Customs in the 
hozei area is not inconsistent with the TRIPS Agreement. 
  WT/TPR/M/211/Add.1 
 Page 163 
 
 
  Q3-2. What are the characteristics of th e five different types of hozei areas? 
 
A. The characteristics of the five differen t types of hozei areas are asa follows; 
 
Types Main functions Storage period 
Designated Hozei Area Loading and unloadi ng, transport, temporary storage of 
foreign cargo 1 month 
Hozei Warehouse Loading and unloading, transport, and long-term storage 
of foreign cargo 2 years (can be extended) 
Hozei Manufacturing Warehouse Processing and manufacturing with raw materials from 
foreign cargoes 2 years (can be extended) 
Hozei Display Area Exhibition/use of forei gn Cargo Period designated by the Director-
General of Customs 
Integrated Hozei Area Loading and unloa ding, transport, long-term storage, 
processing, manufacturing and exhibition of foreign cargo 2 years (can be extended) 
 
Q4. What computer-related graphic images were  granted increased protection under the Design 
Act?  
A. By the amendment to the Desi gn Act in 2006, graphic images u sed on a screen for the operation of 
an article (limited to the operations carried out in or der to enable the article to perform its functions) 
are now protected.  Graphic images "on a multi-use screen used in an integr ated manner with the 
article" are also protected in addition to gr aphic images "on a screen on the article itself."  
 The examination of these graphic images as well as ot her articles is conducted from the viewpoint of 
novelty and creativity and is based on the Design Examination Standard.  
 
Q5. What is the legal status of the IP Headquart ers?  What, exactly, is the Intellectual Property 
Strategic Programme (IPSP) 2007?  
A. The IP headquarters is an organization whic h was established based on Article 24 of the 
Intellectual Property Basic Act. 
 
The Article 23 of the Intellectual Property Basic Ac t stipulates that the Intellectual Property Policy 
Headquarters shall develop a promotion program on  the creation, protection and exploitation of 
intellectual property.  
For details of the Intellectual Property Strategi c Programme (IPSP) 2007, please visit the website 
below:   http://www.kantei.go.jp/jp/singi/titeki2/keikaku2007_e.pdf  
Q6. "112. The resale price maintenance (RPM) syst em continues to be exempted from the AMA for 
copyrighted works (books, magazines, newspapers , and music cassettes, records, and CDs).  The 
authorities consider that the RPM exemption shoul d be abolished from the viewpoint of competition 
policy;  however, there is a lack of national c onsensus, as many argue that such abolition might 
adversely affect cultural values and/or th e 'public aspect' of copyrighted works." 
 
A. "Copyrighted products", as defined in Par agraph 4, Article 23 of the Antimonopoly Act, is 
understood to cover the following 6 items:  books, m agazines, newspapers, records, music tapes and 
music CDs. 
 WT/TPR/M/211/Add.1 
Page 164  
 
  Q7-1,7-2. What are the objectives of SPRING?  How does it interact with the public sector?  How do 
its activities fit in with government sectoral policies?  (The Internet page provided in the Secretariat 
report is written in Japanese, using Japanese characters).  Q7-1. What are the objectives of SPRING? 
 
A. The objective for setting up this organization is to support the resolution of the various 
problems which the service industry is facing.  Fo r the purpose of supporting dynamic growth in the 
service industry by increasing the level of produc tivity and innovation, the organization provides 
information on innovative management tools, offers of opportunities for effect ive knowledge sharing, 
and support for the independent actions of private firms.   
Q7-2. How does it interact with the public sector ?  How do its activities fit in with government 
sectoral policies?  (The Internet page provided in the Secretariat report is written in Japanese, using 
Japanese characters). 
 
A. The Ministry of Economy, Trade and Industry and other relevant government agencies are 
working with SPRING as observers.  Experts fr om public, academic and public sectors have been 
discussing SPRING's activities and sharing inform ation on improving productivity in the service 
industry. 
 Q8. According to this paragraph, the Nip pon Telegraph and Telephone  (NTT) Corporation 
dominates the telecommunications market in Jap an.  Does NTT have to fulfil any particular 
obligations or conditions  in order to act as the dominant operator? 
 
A. Dominant regulations in the telecommunica tions market in Japan are mainly based on the 
designated telecommunications facilities system.  The system is operated by designating Type 1-
designated telecommunications facilities for fixed-line markets and Type 2-designated telecommunications facilities for mobile markets.   Certain facilities of NTT East and NTT West a re currently designated as Type 1-designated 
telecommunications facilities. Without using Type 1-designated telecommunications facilities, it is 
very difficult for competitive operato rs to provide telecommunications services.  In this regard, the 
Type 1-facilities are essential for competitive operators' service prov ision, and therefore NTT East 
and NTT West should comply with certain obliga tions and restrictions under the designated 
telecommunications facilities system, which include service regulations such as ensuring competitive 
operators access to Type 1-facilities,  interconnection rules such as setting cost-oriented tariff rates, 
and prohibition of acts such as unduly discriminating against competitive operators.  
 Type 2-designated telecommunications facilities currently include NTT DOCOMO's facilities.  In 
designating Type 2-facilities, market power is estim ated based on market s hares and other factors. 
When the share of terminals in an operating region exceeds 25 percent, the obligation to make 
reference interconnection offers and to make them pub lic is applied.  When market share in an 
operating region exceeds 25%, restrictio ns on prohibited ac ts similar to those for Type 1-facilities are 
imposed by the authority.  NTT DOCOMO must co mply with such obligations and restrictions. 
  BRAZIL ADD.1
 
  
Q1. Japan has not mentioned some IP elemen ts of TRIPS Council ne gotiations on outstanding 
implementation under the Doha work programme.  Brazil would like Japan to elaborate on the 
mandated review of 27.3(b) and, more specifica lly, the relationship between the TRIPS Agreement  WT/TPR/M/211/Add.1 
 Page 165 
 
 
  and the UN Convention on Biological Diversity(CBD );  as well as the protection of traditional 
knowledge and folklore.  
A. Japan understands that Brazil's question c oncerns the discussion on the review of the 
provisions of Article 27.3(b) of the TRIPS Agreem ent, the relationship between the TRIPS Agreement 
and the Convention on Biological Diversity and prot ection of traditional knowledge and folklore. 
Japan has actively participated in the discussion on  the relationship between the TRIPS Agreement 
and the Convention on Biological Diversity as an outstanding implementation issue pursuant to 
paragraph 12(b) of the Doha Ministerial Declaration.   Japan has also actively participated in the 
discussion at the TRIPS council on the review of the provisions of Article 27.3(b), the relationship 
between the TRIPS Agreement and the Conventi on on Biological Diversity and protection of 
traditional knowledge and folklore, pursuant to parag raph 19 of the Doha Ministerial Declaration. 
Japan has contributed to these discussions, for example , by submitting its proposal for a database on 
genetic resources and will continue to participat e in the discussion in a constructive way. 
 Q2. Which concrete measures in the field of IP R enforcement does Japan intend to seek under the 
ASEM Trade Facilitation Action Plan?  
A. Japan takes part in ASEM activities under TFAP,  which aims at promoting broad-ranging 
dialogue among ASEM partners and an enhanced und erstanding of the application of intellectual 
property rules in public and private sectors.  Japan  has not sought concrete measures in the field of 
IPR enforcement under TFAP.  
Q3. How is IP addressed within the Japan-China  Economic Partnership Consultation?  How does 
such initiative differ from bilateral dialogues with other such as the EC and the US?  
 A. Under the Japan-China Economic Partnership Consultation, the Government of Japan raises 
bilateral IP issues and concerns to China.  As this  Consultation is an inter-governmental consultation 
between Japan and China, there is no difference from  other bilateral governmental dialogues, in 
terms of its framework.   
 
Q4. Brazil would like Japan to provide figures on the patent and trademark backlog of the JPO. 
 
A. As of the end of CY2007, the latest fixed number of the patent backlog at the JPO is 888,000 
and that of the trademark backlog is 70,000. 
 
Q5. Brazil would like to know which measures th e JPO is taking to prevent misappropriation of 
common generic names of the biodiversity through the granting of trademark rights, despite the lack 
of distinctiveness.  
A.   
1. Under the Japanese Trademark Act, tradema rks which are recognized in the Japanese 
market, as these indicate common names, raw material s, or qualities of the designated goods, are not 
eligible for trademark registration;  therefore, such common generic names of biodiversity are not 
entitled to trademark registration.  2. In the case of services, the names of articl es used for providing su ch services are not entitled 
to registration as trademarks. 
 
3. In addition, any party c oncerned may file an opposition to a trademark registration or 
request a trial for the invalidation of a trademark registration.  WT/TPR/M/211/Add.1 
Page 166  
 
  4. Please note that the list of common generic names of biodiversity  in Brazil provided by the 
Brazilian government is used as reference material  in the trademark examination conducted by the 
JPO. 
 
Q6. "During the review period, the authorities placed emphasis on the promotion of selected 
industries, for example, additional assistance was introduced for the production of aircraft" 
The Mitsubishi Jet project has received a large cove rage by the press, starting in 2007 and throughout 
2008, including information about financial support from the Government and pre-orders agreed 
between the manufacturer and Japanese air lines.    
In March 2008 the Brazilian Embassy formally re quested to be informed, under the rules of 
ASCM/WTO, about the official support program, especially the project known as "Environment-Friendly, High Performance Small Aircraft" from NEDO ("New  Energy  and Industrial Technology 
Development Organization", linked to the Ministry of  Economy, Trade and Industry of Japan), but no 
answer has been provided.   
 
Even though the Mitsubishi Jet project is supposed to be completed in few years, since 2003, according to the press, this official mechanism of s upport has been operational. It might be interesting 
to know whether the Japanese government envisages to  make public such information, under the 
ASCM/WTO, in order to allow its consiste ncy to be appropriately verified.   
 
The lack of information from the Japanese authorities regarding such an important issue is of great 
concern to Brazil.  Transparency is one of the f ounding principles of the WTO system as a whole, and 
of the SCM Agreement in particular.  Brazil s ees this Trade Policy Review as an opportunity for 
Japan to provide the necessary info rmation to the WTO membership. 
 
Can Japan provide a reply to Brazil's queries? 
 
A. Japan's policies for the development of the manufacturing industry, including those towards 
the Mitsubishi Regional Jet project, are fully co mpatible with its obligations under the WTO 
Agreement.  Japan's subsidies related to aircr afts can be found in Japan's notification 
(G/SCM/N/155/JPN), pursuant to Article 25 of the Agreement on Subsidies and Countervailing 
Measures. The most recent status of the subsidies are as follows: 
 - The annual amount budgeted for "Subsidy of Ex pense to Investigate the Development of Next 
Generation Airplanes" is:  - Fiscal year 2006 (final results): ¥165 million; and 
 - Fiscal year 2007 (final results): ¥155 million. 
 - The annual amount budgeted for "Assistance for Development of Civil Aircraft" is:  - Fiscal year 2006 (final results): ¥834 million; and  - Fiscal year 2007 (final results): ¥1,050 million. 
 Q7. Could Japan clarify if among the measures to tackle the crisis is there any which can directly 
affect the foreign trade, such as the adoption of non- automatic licenses, or the increase of tariff rates.   
 
A. Given the current economic crisis, it is necessa ry to counter the emergence of protectionism. 
Japan has therefore made a standstill commitment agai nst the introduction of new measures intended 
to protect the Japanese market, as has been stated in declarations made at the Summit on Financial 
Markets and the World Economy, APEC Economic Leaders' Meeting, and Japan-China-ROK 
Trilateral Summit.  
  WT/TPR/M/211/Add.1 
 Page 167 
 
 
  Q8. "(…) In FY2008, Japan unilaterally reduced  applied MFN tariffs on petroleum products and 
industrial alcohol;  for example, the applied MFN rates are 16.9% (20.3% in FY2007) for industrial 
alcohol, and between ¥434 to ¥1,614 pe r kilolitre for petroleum products."   
Enacted in May 2006, the Japanese new policy on Energy allows the use of up to 3% of ethanol on gasoline.  However, the high duties imposed on alcohol reduce significantly its competitiveness 
regarding fossil fuels.  This policy seems to be  in contradiction with the general purpose of a 
"balanced and stable supply of  energy resources" traditionally implemented by the Japanese 
government.    Considering the importance it attaches to fulfilling the Kyoto Protocol obligations, Brazil wishes to 
know whether the Japanese government intends to accelerate the schedule of reduction of tariffs on 
ethanol imports.  The present legislation stipul ates the progressive reduction until 2010 of import 
duties on ethanol imports, although there is no expect ation of its total elimination.  Given the very 
limited capacity of production of ethanol in Japan, Brazil asks whether there is an intention to reduce 
these levies to zero.   
 
A. Japan has already decided to gradually re duce applied MFN tariffs on industrial alcohol 
(2207.10-190) to 10% by FY2010 (FY2008:16.9% FY2009:13.4% FY2010:10%), although the report 
by the secretariat only states that Japan reduced app lied MFN tariffs on industrial alcohol to 16.9% 
in FY2008 (Chapter III, paragraph 20). 
 Q9. Could Japan inform what is the percen tage of agricultural imports conducted under 
preferential rate agreement?  
A. Data on the percentages of agricultura l imports conducted und er Japan's EPAs is not 
available.  
 
Q10. Could Japan inform, in terms of the Harm onized System, what products are subject to the 
import quotas indicated in the paragraph above mentioned? 
 
A. The items which are subject to the import quot as are, as the page 42 of the report describes, 
the specific marine products (they are eight items  at the HS classification 4-digit level) and 
substances listed in the Annex of the Montreal Prot ocol on Substances that Deplete the Ozone Layer. 
 
Q11. Which Japanese entities are authori zed to issue certificates of origin? 
 
A. For the purposes of implementing Japan's exi sting EPAs, the Ministry of Economy, Trade and 
Industry (METI) functions as the competent governme ntal authority in charge of the issuance of 
certificates of origin.  METI, in this capacity, d esignates  issuing bodies.  METI has thus far 
designated the Japan Chamber of Commerce and Industry (JCCI) as an issuing body for said certificates of origin. 
 
Q12. Brazil would like to clarify the amendment to its Customs Law regarding the prevention of 
the transit of goods infringing IPR.  In light of  which legislation does Japanese Customs judge the 
legality of IPRs of goods in tran sit being shipped to third market s?  Is there a possibility that, 
according to the Japanese legislation, a consignmen t of goods meant for third markets deemed illegal 
for infringement of IPRs in Japan, even if the goods are legal in the market where they are meant for? 
 A. We have amended the Customs laws in order to prohibit the placement of goods infringing 
intellectual property rights (IPR) into custom s areas for transshipments and customs transit. 
 Whether or not goods in transit infringe IPR is  judged in accordance with Japan's national IPR 
related laws (e.g. the Trademark Act, Copyright La w and the Patent Act).  Even if the goods in transit WT/TPR/M/211/Add.1 
Page 168  
 
  violate only Japan's national IPR related laws and not violate IPR related laws in the third countries 
where the goods meant for, the transit is prohibited. 
 
Q13. The Patent Act was amended in order to a llow increased period for filing appeals against an 
examiner's refusal.  Do the amendments provide fo r increased for filing opposition to patent requests? 
 
A. No, because the Patent Act does not set a period for filing an opposition.  The opposition 
system was integrated with the trial system in 2003, and under the Trial system any party who 
opposes the patent of another party can request an invalidation trial at anytime after the grant of a patent. 
 
Q14. "(...) 17,4 %  of  duties  ap plied  to agricultural goods are non- ad valorem .  More specifically, 
59,6 % (Table  IV.1) of sugar and s ugar confectionery are subject to non- ad valorem  tariffs.  Brazilian 
exports of sugar have been hindered and reduced due to that restriction.  Considering that Japan does 
not produce substantive amounts of sugar, the main result of applying non- ad valorem  duties is an 
unnecessary burden on consumers' prices.  Are there any plans to advance in the tariffication process?   
 Sugar producers from developing countries are heavily affected by non- ad valorem  duties that are 
biased against low-price competitive exporters.    It might be interesting to know whether th e Japanese government envisages a reform on the 
non-ad valorem  duties imposed on agricultural imports.   
 
A. The application of non-ad valorem tariffs  on certain agricultural products in Japan is 
consistent with the WTO agreements.  Applying a n on-ad valorem tariff in itself is not necessarily a 
burden on consumers, and it has certain advantages;  for example, tax base can be easily examined 
by the quantity or weight of impor ted goods.  Japan will c ontinue its efforts to set appropriate tariff 
types and levels in line with the results of DDA negotiations. 
 
Q15. Please specify the amount and type of subsidies granted to rice producers.  The same paragraph also states that rice, wheat and barley  "remain the most heavily supported commodities".  
Could Japan provide updated information on total subsidies provided for those commodities?    
 
A. The amount and type of domestic support fo r rice, wheat and barley in 2006 are as follows: 
Rice:  70.1 billion yen as a Blue Box programme and 2.3 billion yen as the de minimis  Wheat:  92.6 billion yen as AMS Barley:  11.1 billion yen as AMS 
 
For further details, please refer to the relevant notifications (G/AG/N/JPN/137). 
 
Q16. "(...) The simple average applied MFN tari ff for imported industrial products (HS 25-97) is 
3.6% (FY2008), compared with 15.7% for agricultu ral products (HS 01-24).  Simple average tariffs 
are considerably higher for footwear and hea dgear than for other manufactured goods."   
 
On the other hand, Japanese imports of leather are fr ee from restrictions.  As a consequence, Brazilian 
exports of leather have increased, but Brazilian produ cers of footwear's access to the Japanese market 
have lost market share.    
Would the Japanese government inform whet her it envisages any reform on the non- ad valorem  
duties on footwear?   WT/TPR/M/211/Add.1 
 Page 169 
 
 
  A. Non-ad valorem duties applied in Japan are set to be consistent with WTO agreements.  
Japan will continue to engage in discussion in th e WTO in a constructive manner and set appropriate 
tariffs, while considering the progress and results of DDA negotiations.  
 
Q17. "(…) Japan also intends to assist the deve lopment of manufacturing, including the aircraft 
industry (e.g. the Mitsubishi Rear Jet project)". 
 Please provide details on the policies as they we re not made available by the Secretariat. 
A. Japan's policies for the development of the manufacturing industry, including those towards 
the Mitsubishi Regional Jet project, are fully co mpatible with its obligations under the WTO 
Agreement.  Japan's subsidies related to aircrafts can be found in Japan's 
notification(G/SCM/N/155/JPN, pursuant to Article 25 of the Agreement on Subsidies and Countervailing Measures.  The most recent st atus of the subsidies are as follows: 
 - The annual amount budgeted for "Subsidy of Ex pense to Investigate the Development of Next 
Generation Airplanes" is: 
 - Fiscal year 2006 (final results): ¥165 million; and  - Fiscal year 2007 (final results): ¥155 million.  - The annual amount budgeted for "Assistance for Development of Civil Aircraft" is:  - Fiscal year 2006 (final results): ¥834 million;  and 
 - Fiscal year 2007 (final results): ¥1,050 million.  
Q18. "The centerpiece legislation governing the ope ration of banks is the Banking Law;  the Law 
stipulates that a license is required to operate a ba nk in Japan..."  The footnote quoted (#44) in that 
paragraph stresses that banks licensed in Japan de pend on ministerial authorization to operate their 
agencies.  Which of the two requirements are co nsidered by Japanese government to allow this 
operation?  
A. In order for a foreign bank to conduc t banking businesses in Japan, it may follow the 
following methods:  
1. It is required to obtain a banking license to  conduct banking businesses by establishing a 
branch in Japan (Article 4-11based on  Article 47-1 of the Banking Act).  It is also required to obtain 
a banking license to conduct banking businesses as a domestic juridical person under Article 4 of the 
Banking Act.  
2. A foreign bank, which has a licensed branch or banking subsidiary in Japan within its group, 
may conduct business by entrusting it to the said branc h or subsidiary in Japan.  In this case, the 
branch or subsidiary in Japan has to be perm itted to do so as the foreign bank's agency service 
(Article 52-2 of the Banking Act). 
 
Q19. It is stated that "there are no state-owned insurance companies in Jap an."  However, in the 
same paragraph, it is also declared that "the Japan  Post Insurance Co. Ltd is fully owned by...a fully 
state-owned holding company".  Please e xplain this apparent contradiction. 
 
A. Japan Post Insurance started its business in October 2007, when Japan Post was privatized. 
Under the Law of the Privatization of Postal Service s, Japan Post Holdings is obliged to dispose of 
all of the shares it holds in Japan Post Insurance no later than 30 September 2017. 
  WT/TPR/M/211/Add.1 
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  EUROPEAN COMMUNITIES
 
 
Q1-1. Could Japan explain why its contributions to the mentioned multilateral TRTA schemes have 
been fairly modest (especially when co mpared to its overall ODA expenditure)?  
 
A. It is true that more importance has been a ttached to bilateral cooperation than to multilateral 
schemes in Japanese trade related t echnical assistance programs.  
 Japan is, however, increasing its level of coopera tion through multilateral schemes.  For example, 
Japan has approved the utilization of a part of th e Japanese voluntary contribution fund to the ADB 
for AFT projects in Asia.  Funds will be utilized for review meetings, among ot her things.  Japan has 
also increased its multilateral contributions for AFT th rough international organi zations such as EIF, 
WCO and ITC.    Japan has steadily implemented the "Development Initia tive for Trade," and intends to continue to 
proactively provide economic assistance to developi ng countries, through multilateral schemes as 
well as bilateral cooperation. 
 
Q1-2. Is Japan planning a meaningful contribution to the Integrated Framework for LDCs?  A. Japan will continue to contribute to the (E nhanced) Integrated Framework through bilateral 
cooperation as well as through the multilateral trust fund, in line with the report of the Task Force on 
EIF (WT/IFSC/W15).  In regard to the multilatera l trust fund, Japan will disburse 300,000 USD by 
the end of FY 2009, almost the double the amount of previous year, assuming that Japan's Diet approves the national bu dget for FY2009.  
 
Q2. Could Japan explain how and when it intends to reach the 100% coverage set out in Annex F 
of the Hong Kong Declaration, and if such decision would be conditional upon the successful 
conclusion of the Doha Round?  (See also paragra ph 75 where Japan indicate that it would "steadily 
implement its Development Initiative for Trade re gardless of the progress of DDA negotiations". 
 A. Since 1 April 2007, Japan has expanded duty-free and quota-free (DFQF) market access to the Least-Developed countries (LDCs), covering appr oximately 98% of all tariff lines, regardless of 
the progress of DDA negotiations.  Through this measure, Japan has realized upon its comm itment to provide DFQF market access for at 
least 97% of products originating fr om LDCs, as is stated in para. 36 (a) (ii) of the Annex F of the 
WTO Hong Kong Ministerial Declaration. (See WT/COMTD/N/2/Add.14 for details).   Japan will continue to apply its ta riffs in an appropriate manner. 
 
Q3. Could Japan provide more information on the "One Village, One Product" movement, in 
terms of achieved results, evaluations of the scheme by development experts and how this links with 
the Aid for Trade initiative?  
A. The One Village One Product (OVOP) Initiati ve was announced as one of the measures of the 
Japan's Development Initiative at the WTO Hong Kong Ministerial Meeting in 2005.  Through the 
One Village One Product Initiative, Japan provides a ssistance for Least Developed Countries (LDCs) 
and other developing countries to enhance their ability  to identify, improve and export their products 
to the Japanese market.  The OV OP Initiative enables countries to reap greater benefits from the 
multilateral free trade system embodied by WTO agr eements.  Japan considers the OVOP Initiative to 
be a concrete example of Aid for Trade.    
  WT/TPR/M/211/Add.1 
 Page 171 
 
 
  With that purpose in mind, Japan is sending experts to assist with the development and marketing of 
the products exported to Japan.  As  a result of projects that provided marketing advice to producers 
of cut flowers in Kenya, Ethiopia, and Tanzania, the volume of exports to Japan has rapidly increased 
since 2006.  As another example, as a result of prov iding technical assistance to Indonesian craftsmen 
of Galuchat goods to help them develop products  for export to the Japanese market, Galuchat 
products enjoy high popularity at a stationery shop dealing in luxury goods in Ginza, Tokyo.     
 
Q4. Could Japan provide more information on $2.5 billion support it intends to provide as 
financial assistance to stimulate Japanese private sector investment s in Africa under the new "African 
Investment Facility"? 
A. In order to foster Japanese private busin ess operations in Africa, the Japan Bank of 
International Cooperation (JBIC) Facility for Af rican Investment (FAI) will be established in 
April 2009.  Under the FAI, JBIC, in addition to the direct lending of hard-currency, will make equity 
investments and guarantees for the loans of private banks, as well as provide local currency financing 
to projects in African countries. 
 
Q5. As regards, Japan's "Development Initiative fo r Trade", we note with interest the initiative's 
focus on three stages (produce/sell/buy).  Could Japan  provide links to a more detailed description, 
website or brochures on this Initiativ e, and elaborate on how this links with the recommendations of 
the WTO Aid for Trade Task Force.  A. Please refer to presentation materials for de tails on the "Development Initiative for Trade." 
The materials may be found at http://www.mofa.go.jp/policy/economy/wto/min05/initiative.html.  The "Development Initiative for Trade" is a comprehen sive package of measures intended to promote 
the empowerment of developing countries and help them to reap the benefits of the multilateral 
trading system.  It includes various types of supports extended through Official Development 
Assistance (ODA), which is defined as "Aid fo r Trade (AFT)" by the Report of the Task Force 
(WT/AFT/1).  Japan has already made clear its  position on AFT, and presented some experiences with AFT through 
the Initiative, during the AFT Symposium in Septem ber 2008 and in other meetings.  Please refer to 
Japan's presentation material for details.  They ar e located at http://www.wto.org/english/tratop_e 
/devel_e/a4t_e/sym_sept08_presentations_htm,   Japan will explain the results of the Initiative, at the AFT review meetings which are scheduled for 
later this year. 
 
Q6. Are structural reforms still a priority in Japan at a time of increased public spending to tackle 
the economic crisis?  
A. The structural reforms that were implem ented have contributed to the recovery from the 
stagnation that occurred after the collapse of Japan's overheated stock and real estate markets. 
However, Japan now faces new challeng es due to the global finance crisis. 
 In the short term, Japan gives top priority to th e recovery of the economy within three years through 
the implementation of an economic policy package  amounting to 75 trillion yen.  In addition, Japan 
plans to construct a sustainable social secur ity system and ensure fiscal consolidation by 
implementing "the mid-term program" while aimi ng at achieving economic gr owth through reforms 
by drawing up and boldly implementing a scenario for future growth.  
 WT/TPR/M/211/Add.1 
Page 172  
 
  Q7.8. The WTO Secretariat's Report mentions the intention of the Government of Japan to 
introduce additional budget measures in th e face of a global economic recession.  
 Could Japan describe whether the measures foreseen target only Japanese companies or do they apply 
to all companies active on Japanese Territory?  
Do some of these measures prioriti es companies with a trade focus? 
 
A. In general, openness around trade and invest ment is one of the most important policy 
priorities of the Japanese government, and Japan engag es in various economic measures in line with 
such a policy. 
 
Q9. The WTO report describes the FSA plan for st rengthening the financial and capital markets. 
Great progress has been made by Japan, especially with the removal of firewalls between banks, insurance companies and securities; and w ith efforts towards better regulation. 
 
The aim of the FSA plan was to attract foreign institutions to Japan as a way to increase innovation 
and thus competitiveness of the Japanese financial se ctor.  Could Japan comment on the impact of the 
financial crisis on the achievement of these goals of the FSA plan?  
A. Japan has developed a lot of reforms in financ ial services. For example, the revision of the 
Financial Instruments and Exchange Acts, in whic h relevant provisions were revised as necessary, 
and the revision of measures for realizing Better Re gulations, based on "the Plan for Strengthening 
the Competitiveness of Japan's Financial and Capital Markets" were introduced. 
 Although measures for securing discipline in financi al markets have been taken internationally in 
response to the recent financial turmoil, Japan belie ves that these measures will not have a harmful 
effect to its some efforts aimed at fulfilling financ ial intermediary function appropriately in a manner 
contributing to the develop ment of Japan's economy. 
 Japan also holds the view that, in implementing th ese measures, it is necessary to continue to make 
progress, taking into account less ons provided by recent financial markets and necessity of ensuring 
consistency with international efforts.  
 
Q10. Could Japan provide further details on its efforts to facilitate universal banking? 
 
A. In terms of responding to requests for comprehensive service supply and risk management in 
financial groups, "the Bill for Amendment of th e Financial Instruments and Exchange Act, etc," 
promulgated on 13 June 2008, includes the revision of firewall regulations among securities, banking, 
and insurance and the expansion of business scope in banking an d insurance groups. 
 The revision of firewall regulations will come into effect from 1 June 2009. 
 The expansion of business scope in banking and insu rance groups came into effect on 12 Dec 2008. 
 
With regard to whether or not there is a necessity to  aim at universal banking, it is necessary to study 
carefully from the viewpoint of securing bank ing soundness of banking system by conducting 
securities business simultaneously, the effects on depos itor protection, and the possibility of the abuse 
of dominant bargaining positions.  
 
Q11. Can Japan confirm that Japan Post Insuran ce entity is about to request authorization to 
commercialize cancer insurance products?   WT/TPR/M/211/Add.1 
 Page 173 
 
 
  A. Japan has not received any requests regardi ng cancer insurance products from Japan Post 
Insurance.  
 
Q12. Given recent Japanese press reporting on th e government decision to temporarily freeze the 
planned sale of 70 Kampo's resort facilities, could Jap an provide an update on the state of play of the 
implementation of its plan to privatize the state-run postal services? 
 
A. Japan Post was privatized on 1 October 2007.  The privatization of Japan Post is proceeding 
in line with its original plan so far. 
 Q13. The WTO Report mentions improvements to the corporate governance system.  However, the 
EC regrets that the Government of Japan has not  responded positively to our request for amendment 
of Article 821 of the Corporate Law, which the EC  believes would contribute to creating an open and 
predictable environment for trade and investment.  Article 821 creates uncertainity about the legality 
of foreign companies' business operations in Japan.  It provides that foreign companies with a main 
office in Japan or whose primary purpose is to conduct business in Japan cannot engage in 
transactions on a continuing basis in Japan or, in a literal reading of Article 821, they face the risk of 
prosecution.  Could Japan outline any movements towards an amendment of Article 821?  A. Japan does not plan to amend Article 821 of the Companies Act at this stage. 
 While Japan continuously watches for any impacts c aused by Article 821 of the Companies Act, it has 
not recognized any actual pr oblem caused by the said provision.  The said provision regulates only "a 
foreign company which is constituted or organized under the law of the foreign country, and has its 
head office in Japan or whose main purpose is to conduct business in Japan" (a so called "pseudo-
foreign company").  This provision is stipulated to  avoid situations such as one where a company is 
established under foreign laws for the purpose of circumventing the application of Japanese laws.  
Therefore, Japan does not consider that Article 821 of the Companies Act prevents foreign companies 
which are duly conducting business outside J apan from establishing a branch in Japan. 
 Q14. Could Japan elaborate further on how it inte nds to encourage sustainable development and 
core labour standards in the context of negotiations  of free-trade agreements with third countries? 
 
A. Japan's EPAs so far have not included chapt ers on the environment or on labor.  However, 
most EPAs address the issue of sustainable  development and labor standards through the 
implementation of such provisions as by the rea ffirmation of the rights and obligations of other 
existing international agreements, as well as the various economic cooperati on activities described in 
cooperation chapters.  In addition, some of Japan's EPAs stipulate in chapters on Investment that it 
would be inappropriate to  encourage investment through a relaxat ion of the environmental measures 
or by weakening or reducing the protect ions afforded in domestic labor laws. 
 Q15. Could Japan explain what rules of origin are applied for goods and services traded with 
countries that are members/signatories of both ASEAN and AJCEP in the context of bilateral FTAs that Japan has signed with members of ASEAN?   
A. The AJCEP Agreement and the individual bi lateral EPAs with members of ASEAN are 
completely separate agreements with no order of prio rity as legally binding documents.  The rules of 
origin applied for goods depend upon which agreement each user d ecides to use when exporting. 
 
Q16. Could Japan, nevertheless, give an outline of the provisions of the agreement with respect to 
its main elements (Trade in Goods, Rules of Origin, Customs Procedures and Trade Facilitation, WT/TPR/M/211/Add.1 
Page 174  
 
  Trade in Services and Movement of Natural Person s, Investment, Intellectual Property, Government 
Procurement, Competition, Electronic Commerce and the Promotion of a closer Economic Relationship)?  
A. The Agreement on Free Trade and Economic Partnership between Japan and the Swiss 
Confederation (JSFTEPA) will mark a new era  of economic partnership between Japan and 
Switzerland and will provide a solid basis for the fu rther strengthening of the bilateral relationship 
between the two countries, particularly thr ough trade and investment.  Although more detailed 
information of the Agreement can be provided on ce the Agreement is signed, the major elements of 
the JSFTEPA which the Government of Japan  can provide now are as follows:  
 
Regarding "Trade in Goods," both si des will eliminate or reduce tar iffs on industrial, agricultural, 
forestry and fishery products comprehensively.  Custom s duties for more than 99% of the total volume 
of trade between Japan and Switzerland will be free within ten years of the Agreement's entry into 
force.  
 
Regarding "Rules of Origin," the JSFTEPA will provid e a framework for origin declarations by 
approved exporters, for which Japan will introduce a new system.  Regarding "Customs Procedures and Trade Facilita tion," both sides will promote trade facilitation 
and effective enforcement against illicit goods or goods infringing intellectual property rights, 
through the simplification of customs procedu res, cooperation between authorities and exchanges of 
information.   Regarding "Trade in Services and Movement of Natural Persons," the JSFTEPA will provide a 
framework for liberalization of trade in services bas ed upon a "negative list" approach, and facilitate 
the movement of natural persons for business purposes between the two countries.  
 Regarding "Investment," the JSFTEPA will provid e a framework for further expansion and the 
facilitation of cross-border investment between th e two countries through commitments on national 
treatment, most-favored nation treatment, and enhanced protection of investors and investments, 
including the provision of a mechanism for dispute settlement between state and investor.  
 
Regarding "Intellectual Property," both sides will protect all categories of intellectual property rights covered by the TRIPS Agreement and th e new varieties of plants, provide measures for enforcement of 
intellectual property rights and cooperate in promoting adequate and effective enforcement of intellectual property rights.  
 
Regarding "Government Procurement," the JSFTEPA w ill provide a framework for the exchange of 
information through contact points and a mechanism fo r further dialogue with a view to maximize 
access to the government procuremen t market of the two countries.  
 Regarding "Competition," the JSFTEPA will provide a fr amework for effective enforcement of the 
competition laws and regulations through the devel opment of a cooperative relationship between the 
competition authorities of the two countries.   Regarding "Electronic Commerce," the JSFTEPA contains a chapter on electronic commerce, a first, countries.  The chapter describes a comprehensive set of  provisions including those related to digital 
products, services transmitted electronically, el ectronic signatures and the protection of online 
consumers with a view to encourage and facilita te electronic commerce between both countries.  
  WT/TPR/M/211/Add.1 
 Page 175 
 
 
  Regarding the "Promotion of Closer Economic  Relationship," the JSFTEPA will provide a 
mechanism for the promotion of closer economic  relationship between Japan and Switzerland, with 
the participation of the governments and the business sectors of the two countries. 
 
Q17. Could Japan indicate what percentage of 'e ligible' imports of sensitive products actually fall 
under the ceiling and receive GSP treatment? 
 
A. It is not possible to calculate the overall p ercentage of 'eligible' imports of sensitive products 
that fall under the ceiling because each ceiling is de termined item by item based on import volume or 
weight.  
 
The actual results of the ceiling each year are publis hed in an official gazette.  As for the actual 
performance of the ceiling in 2008, please refer to the following link (Japanese only) http://www.customs.go.jp/tokkei/tokkei.pdf. 
 Q18. Could Japan provide the figure for the to tal value of Least Developed Country imports? 
 
A. The total value of imports from LDCs  in CY2008 was approximately 789 billion yen. 
 
Q19. Noting the high concentration of Chinese imports under Japan's GSP scheme, could Japan 
inform whether it is considering any steps to  ensure a wider uptake of GSP preferences? 
 
A. Japan prepares systems, for the graduation of  advanced beneficiaries" and "competitiveness-
focused, product-by-exclusion" to ensu re a wider uptake of GSP preferences. 
 
For further information, please ref er to the following website:   
http://www.mofa.go.jp/policy/economy/gsp/explain.html#06   
Q20. Could Japan elaborate upon the rationale for choosing as a notification ceiling for FDI 
requiring prior authorisation the figure 10% of the stocks of a company active in a sensitive sector? 
 
A. There are cases where investo rs possessing around 10% of a company's shares exert their 
influence over the management of the company.   
Q21. Prior notification for inward FDI is required in  a number of sectors (Table A II.3).  In 2008, 
for the first time, Japan recommended against a FDI project (in the electric utility sector).  Could Japan clarify whether it is considering reducing th e list of sectors requiring prior notification or 
publishing clear guidelines on the implementation of such restriction? 
 
A. Under the Foreign Exchange and Foreign Tr ade Act (FEFTA), Japan has regulations on 
inward direct investment that comply with in ternational rules including the OECD Code of 
Liberalization of Capital Movements.  The scope  of the regulation under FEFTA is clearly identified 
in the government notice. Since the regulation is le ss restrictive than that of other countries which 
don't disclose the scope of regulati on, it is not considered as an obstacle to the FDI.  The criterion for 
screening the notification is clearly lis ted under the FEFTA (Article 27-3-1) 
FEFTA:  http://www.cas.go.jp/jp/seisaku/hourei/data/FTA_2.pdf The notice of MOF:  http://www.mof.go. jp/hourei/kokuji/KO- 20070907-0001-15.pdf 
 Q22. Could Japan present the main targets to be reached, including in terms of legislative and 
regulatory changes envisaged/adopted as well as the timeline for their implementation?  
 
A. Japan set the main targets on the strategic dissemination of  information by governments and 
by regional collaboration between local governments,  the improvement of the investment environment WT/TPR/M/211/Add.1 
Page 176  
 
  through measures such as those to facilitate M& As and international capital flow, and active 
publicity to welcome foreign companies toward domestic and foreign areas.  Japan revised the 
"Program for the Acceleration of Foreign Direct Invest ment in Japan" by reflecting these targets into 
the program in December 2008. 
 Q23. To what extent was foreign experience studied and taken into account? 
 
A. Japan revised "The Program for the Accelerati on of Foreign Direct Investment in Japan" by 
reflecting "The Five Recommendations Toward the Drastic Expansion of Foreign Direct Investment in Japan" into the program. 
 
"The Five Recommendations Toward the Drastic Expansion of Foreign Direct Investment in Japan" 
was proposed in May 2008 by the Expert Co mmittee on FDI Promotion which includes several 
foreign experts such as the Chairman of the Europe an Business Council in Japan and the President of 
the American Chamber of Commerce in Japan.  During the consultation process, the committee 
referred to information including examples in foreign countries.   
 
Q24. Could Japan explain what measures it may have  considered to contribute to a more balanced 
bilateral investment flow between the EC and Japan?   
A. Japan revised the "Program for the Acceleration of Foreign Direct Investment in Japan" in 
December 2008.  Japan would like to promote international capital flow through implementation of 
the revised program. 
 
Q25. To what extent will the present economic c ontext have an impact on the revision of the 
Program for the Acceleration of Foreign Direct Investment as finalized in mid-December 2008?  
 
A. Japan revised the "Program for the Acceleration of Foreign Direct Investment in Japan" in 
December 2008.  Japan would like to deal with  the present worsen econo mic situation through 
implementation of the revised program, acceptance of  foreign capital and technique, and creation of 
employment. 
 Q26. Could Japan explain how it intends to fo llow-up on these recommendations by the Expert 
Committee on FDI Promotion?  
A. In December 2008, Japan revised the "Pr ogram for the Acceleration of Foreign Direct 
Investment in Japan" in order to incorporate five recommendations into it. Japan is able to check the 
progress against the timeline for their implemen tation through periodically follow-ups of the 
program.  
 
Q27. Could Japan explain the objective of t hose duties, and whether Japan envisages their 
removal?  A. Like many countries, Japan has set appropriate types and levels of tariffs for each product, 
taking into consideration such elements as th e characteristics of th e product and the tariff’s 
consistency with WTO Agreements.  Japan will conti nue to engage in discussion in the WTO in a 
constructive manner and set appropria te types and levels of tariffs, while considering the progress 
and results of DDA negotiations.  
 
Q28. Could Japan explain whether it currently has any specific trade regime for textiles? 
 
A. Currently, Japan does not have any specific trade regime for textiles. 
  WT/TPR/M/211/Add.1 
 Page 177 
 
 
  Q29. Could Japan please explain the reasons behind this tariff escalation?  
 Q30. Could Japan explain the reasons for this tariff escalation?  
A. Japan sets an appropriate level of tariff ra te on each product by taking into account  
situations of domestic industries.  Issues includi ng tariff escalation are one of the elements of the 
agriculture and NAMA negotiations.  Japan will cons ider the results of the DDA negotiations when 
addressing these issues in the future. 
 
Q31. Could Japan specify which are the main industries concerned? 
 
A. Among the objects covered in the objects of  Japan's GSP scheme, the main import products 
from China in terms of import value are as follows:  bags, toys, cokes, Ferro-silico-manganse, 
electric conductors, toilet linen, kitchen linen, and plastic goods. 
 Q32. Does Japan intend to have the General Acc ounting Law translated into English as has been 
previously requested by the EC?  
A. At present, there is no specific plan to trans late the "General Accounting Law," although the 
Government of Japan continues to revise the Translation Development Program every fiscal year. 
 Q33. Could Japan clarify whether procurement by lo cal government by local public corporations of 
the 47 Prefectures and the 12 designated cities listed unde r Annex 2 in the GPA, in particular in the 
fields of airports, hospitals and urban transport are covered by Japans current commitments under the 
GPA?  A. Procurement, which is referred to in the qu estion, for projects operated by the 47 prefectures 
and the 12 designated cities, including their local pu blic corporations of an amount even above the 
GPA thresholds, is conducted in accordance with the GPA. 
 
Q34. Could Japan outline any plans to establish a single point of access for all public procurement 
business opportunities, including local government, as is done in the EC? 
 
A. There is no single electronic portal which covers all entities in Japan's Annexes of the GPA.  
For the central government entities, th ere is a single portal where relevant information is available in 
English. Local governments covered by the GPA publish notices of intended procurements in 
accordance with provisions of the agreement.  A lthough no specific plan has been drafted yet, the 
Government of Japan has an intention to enhance access points.  
Q35. Does Japan have any data as to the average or median contract value awarded by entities in 
Annex 1, 2 and 3 (broken down by services, supplies and works) for all public procurement (not only 
those covered by the GPA)?  A. (1) The average contract values of goods and services awarded by entities in Annex 1 and 3 of the GPA in 2006 under the Action Program* a re 93 million yen and 131 million yen respectively. 
Please refer to the table below. 
 
Procurement by entities in Annex 1 and 3 (Year 2006) 
 Value (A) (100 million yen) Number of Co ntracts (B) Average(A/B) (million yen) 
Goods 7,865.1 8,420 93 million yen 
Services 4,960.2 3,776 131 million yen 
 WT/TPR/M/211/Add.1 
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  * The Action Program covers in principle procurement contracts made by entities in Annex 1 and 3 of 
the GPA, and goods and services of which values a re equal to or above 100,0 00 SDR.  Also, please 
note that procurement for public works (including architectural planning and consultancy) is 
excluded from the program.  
(2) The average contract values of goods, arch itectural, engineering and other technical services, 
construction services and other services awarded by entiti es in Annex 2 of the GPA in 2006 under the  
Agreement, respectively, are 78 million yen, 2,097 million yen, 3,119 million yen and 193 million yen. 
Please refer to the table below. 
 
Procurement** by entities in Annex 2 (Year 2006) 
 Value (A)  (100 million yen) Number of Contracts (B) Average (A/B) (million yen) 
Goods 2,371.6 3,037 78 million yen 
Architectural, Engineering and 
Other Technical Services 104.9 5 2,097 million yen 
Construction Services 2,370.6 76 3,119 million yen 
Other Services 3,687.1 1,912 193 million yen 
 
** The categories of procurement a re those covered by Japan’s Annex 2 of the GPA. The threshold of 
entities in Annex 2 of the GPA is 200,000 SDR for goods and other services, 1,500,000 SDR for 
architectural, engineering and other technical services and 15,000,000 SDR for construction services. 
 
Q36. Could Japan outline any plans to enhance the pa rticipation of foreign suppliers in Government 
Procurement procedures, especially at the local level?   A. Japan has no rules or regulations that  discriminate against foreign suppliers, goods, or 
services in government procurement covered by GPA.  Japan has been making efforts to ensure non-discri minatory, transparent, and fair procurement 
procedures by implementing additional measures bey ond the obligations of the GPA.  For example, 
under the Action Program on Government Procurement,  in order to encourage the participation of 
foreign suppliers, the 40-day tendering period of the GPA is extended to 50 days when entities in Annexes 1 and 3 of the GPA proc ure goods and services (excluding construction work, architectural, 
engineering and other technical services).  The governme nt of Japan will continue to make efforts to 
encourage the participation of foreign suppliers. 
 Q37. Japan claims that the total value of procurement covered under the GPA amounts to 
¥1.28 trillion, which represents some 0.5% of Japan ese GDP.  Does this value take into account the 
public procurement of local authorities conducted on be half of Central Government Ministries?  How 
much procurement does Japan estimate is (a) not to be covered by the GPA, (b) below the GPA 
thresholds and c) under 100.000 SDR?  What is the proportion of procurement falling above the GPA 
thresholds (e.g.15,000,000 SDR for works,  130,000 SDRs for services and supplies)? 
 
A.37(1)  The Action Program covers in principle pr ocurement contracts made by entities in Annexes 1 
and 3 of the GPA. The value referred to in the qu estion does not include procurement contracts made 
by local governments. 
 
A.37(2) (a) There are no statistics on procurement whic h is not covered by the GPA, other than that 
below the GPA threshold by entities in Japan's Ann ex 1. (b) The total amount of procurement below 
the threshold by entities in Annex 1 was 15.8 billi on SDR in 2006. (c) The Action Program covers in 
principle procurement contracts of goods and services (excluding procurement for public works and  WT/TPR/M/211/Add.1 
 Page 179 
 
 
  architectural planning and consultancy services) which are valued at 100,000 SDR or above.  It is 
difficult to estimate the procurem ent value under this threshold. 
  A.37(3) Procurements of more than the threshold of the GPA are composed of four categories, Goods, 
Architectural Services, Construc tion Services and Other Services.  
 
The numbers, values and their proportions to the total for each category of procurements by Annex 1 
and 2 entities in 2006 are as follows. 
Annex 1 
Category Number % Value 
(million SDR) % 
Goods 2,442  51.0  2,305  30.2  
Architectural, engineering and other technical 
services covered by the GPA 39  0.8  40  0.5  
Construction Services 272  5.7  3,469  45.5  
Other Services 2,032  42.5  1,813  23.8  
Total 4,785  100 7,627  100.0  
 
Annex 2 
Category Number % Value 
(billion yen) % 
Goods 3,037  60.4  237  27.8  
Architectural, engineering and other technical 
services covered by the GPA 5  0.1  10  1.2  
Construction Services 76  1.5  237  27.8  
Other Services 1,912  38.0  369  43.2  
Total 5,030  100 853  100.0  
 
Q38. When measuring the share of public procur ement awarded to foreign suppliers, does Japan 
include contracts awarded to Japanese subsidiaries of  foreign companies or only foreign companies 
(i.e. companies established in another country and bidding from abroad)?  If available, could Japan 
report what is the "foreign share" in comparison to all public procurement rather than just in 
comparison to procurement covered by the GPA?  
A. The Action Program defines a foreign suppli er as "a corporation in which approximately 
more than 50% of shares are owned by foreign investo rs/capitals."  Meanwhile, it covers in principle 
procurement contracts made by entities in Annex 1 and 3 of the GPA, and goods and services 
(excluding procurement for public works including arch itectural planning and consultancy) of a value 
above 100,000 SDR.  Since it doesn’t cover all pub lic procurement, it is difficult to answer the 
question. 
 
Q39. Could Japan explain the decrease of the shar e of contracts awarded to foreign suppliers?  
Also, could Japan provide figures on the share of wo rks and services procurement awarded to foreign 
suppliers?  
A. The share of contracts awarded to foreign suppliers under the Action Program, in terms of 
value, slightly decreased by 0.6% from 2004 to 2006.  However, that share, in  terms of the number of 
contracts, was 3.0% in 2006, increasing from 2. 0% in 2004.  The government of Japan possesses no 
further detailed analysis on these statistical tre nds.  Under the program, the ratio of services 
procurement awarded to foreign suppliers was 4.9% in terms of value and 3.5% in terms of the WT/TPR/M/211/Add.1 
Page 180  
 
  number of contracts.  Procurement for public  works (including architectural planning and 
consultancy) is excluded from the program. 
 
Q40. Could Japan provide a detailed explanation of the full scope of the operational safety clause in 
terms of the goods, services and construction works covered, as previously requested by the EC? 
 
A. In regard to the scope of the clause, Japan considers it to apply to the following five 
categories.  Whether to apply this clause or not should be judged on an individual basis for each product or service.  
1) Supplies forming railway facilities 
2) Rolling stocks and supplies for rolling stocks 3) Supplies and equipments for maintenance 4) Construction, reformation and repair of railway facilities themselves 5) Construction, reformation and repair works whic h are carried out right above or right below 
the railway tracks 
 
Q41. Does the estimate given in Table III.3 for procurement of railway equipment exclude the contracts which are not subject to foreign co mpetition because of the operational safety clause? 
 
A. Yes, the estimate does not include the contracts. 
 
Q42. How does Japan secure that review procedures of contracts awarded by local authorities comply with GPA requirement?  
A. Local governments in Japan covered by the GPA have their own review bodies, as provided 
for in paragraph 6 of Article XX of the GPA, and th eir own guidelines, which deal with complaints 
about procurement procedure in accordance with each paragraph of Article XX of the GPA.   
 
Q43. As the Cabinet Office, to whom is the Government Procurement Review Board (GPRB) 
affiliated?  Is it a contracting authority itself?  A. The Government Procurement Review B oard (GPRB) is held under the Council on 
Government Procurement Review (CGPR). 
 
Q44. How does Japan ensure the independen ce of the decisions taken by the GPRB? 
 
Q45. What sanctions are foreseen against public entities that do not comply with the decisions of 
the GPRB?  
A. The public entity is required, as a rule, to follow the recommendations of the GPRB.  If the 
public entity decides not to comply with the recomm endations, it must report to the GPRB with the 
reasons within 10 days after receiving the GPRB's re commendations (or within 60 days in the case of 
a complaint pertaining to public works).  The GP RB shall then immediately send a copy of the 
reasons to the CGPR. 
 
Q46. Is Japan seeking to bring full harmonisation of  standards in the medical devices sector with 
additional national requirements, both in terms of  Quality Management Sy stem and Good Clinical 
Practices? 
 
A. Japan has been and will be actively taking part in the Global Harmonization Task Force 
(GHTF), and is intent on establishing the interna tional harmonization of medical device regulations.   WT/TPR/M/211/Add.1 
 Page 181 
 
 
  In the regulation of Quality Management System s (QMS) Ministerial Ord er, which is based on 
Japanese Pharmaceutical Affairs Law, Japan has in troduced an internati onal standard, ISO13485. 
Japan is planning to ensure further international c onsistency of medical devices regulation such as 
QMS through its activities in GHTF.   
With regard to Good Clinical Pr actices, Japan is paying careful attention to the revision of ISO14155 
which is currently underway.  
 
Q47. As an example, on 29 May 2006 the Mini stry of Health, Labor and Welfare (MHLW) 
introduced the positive list system for agricultural chemicals remaining in foods, where maximum 
residue limits established for 799 substances, including pesticides and veterinary drugs, at levels far 
lower than those allowed in other countries.  Is Jap an contemplating a process of convergence in these 
limits allowed in food, towards the levels genera lly accepted by the international standard-setting 
bodies?  A. Residue standards (maximum residue limits: MR Ls), which were provisionally established in 
the process of introducing the positive list system  are based on the following standards in descending 
priority.  Codex standards; Registration withholding limits based on the Agri cultural Chemicals Regulation Law (Law No. 82, 
1947), limits of determination (LODs) for veterinary drugs at the time when they were authorized 
based on Pharmaceutical Affaires Law (Law No. 145,  1960), or LODs for feed additives at the time 
when they were authorized based on the Law for Safety Assurance and Quality Improvement of 
Animal Feed (Law No. 35, 1953);  
Standards established by countries where MRLs are a ssumed to be established based on toxicity study 
data equivalent in quality to those used in scien tific evaluations by JMPR (Joint FAO/WHO Meeting 
on Pesticide Residues) and JECFA (Joint FAO/WHO  Experts Committees on Food Additives).  These 
countries are Australia, Canada, EU, New Zealand, and United States.  Japan is systematically conducting risk evaluatio n for the chemicals for which MRLs were 
provisionally established at the introduction of th e new system, and is reviewing the MRLs as needed 
on the basis of the risk evaluation. 
 
Q48. The WTO Secretariat's Report indicates th at "currently, 25 Japanese organizations are 
accredited as JIS mark certification bodies". 
 
Could Japan please clarify whether any of those organizations are foreign?  
A. At present, there are three foreign accred ited certification bodies under the JIS marking 
scheme:  two in Korea, the "Korean Standards Association" and "Korea Testing and Research 
Institute," and one in Australia, the "AWPA Test Centre Association Inc." 
 
Q49. Could Japan elaborate on its plans to adapt its standards/ regulations on pharmaceuticals, electrical appliances, road vehicles, and chemical substances to corresponding international standards/ 
regulations?  A. (1) Pharmaceuticals  Although JIS do not apply to pharmaceutical standa rds/regulations, Japan, the EU and the US are 
working in the International Conference on Harmonization toward the harmonization of 
pharmaceutical standards/regulations. WT/TPR/M/211/Add.1 
Page 182  
 
  (2) Electrical appliances 
 The technical regulations listed  under the Electrical Appliance a nd Material Safety Law have been 
adjusted to the corresponding IEC standards assuming that these IEC standards exist. 
 
(3) Road vehicles 
 Japan intends to apply Regulations under the UN 1958 Agreement (UNECE Regulations) in 
accordance with its priorities, taking into acc ount such elements as domestic and international 
requests, the impact on safety and the environment, the economic ramifications of harmonization, and 
so forth.  Japan will actively promote the applicat ion of UNECE Regulations  and, as appropriate,  
propose necessary amendments to said  Regulations in order to reflect the traffic situation in Japan, 
when the World Forum for Harmonization of Vehicle Regulations is held by the UN.  (4) Chemical substances 
 
Under the Law concerning Examination and Regula tion of Chemical Substances and Regulation of 
their Manufactures, Japan accepts the test data d eveloped in other countries for the purpose of 
notifying to regulatory authorities using OECD Test  Guidelines and OECD GLP principles, based on 
the "Decision of the Council concerning the Mut ual Acceptance of Data in the Assessment of 
Chemicals" made by the OECD Council. 
 
Q50. Could Japan explain its plans for approxima tion of vehicle safety regulations to UNECE 1958 
standards, of which Japan is signatory?  
A. With regard to the Regulations under th e UN 1958 Agreement, Japan intends to apply 
UNECE Regulations in an order corresponding to th e priorities of Japan, taking into account such 
elements as domestic and international requests, the impact on safety and the environment, the 
economic ramifications of harmoniza tion, and so forth.  Japan will actively promote the application 
of UNECE Regulations and, as appropriate, propose necessary amendmen ts to said Regulations in 
order to reflect the traffic situation in Japan, when the World Forum for Harmonization of Vehicle 
Regulations is held by the UN. 
 
Q51. Could Japan clarify whether any of those organizations are foreign?  
A. All of the 12 registered certification bodies are located in Japan.  5 of them are foreign 
affiliated companies. 
 
Q52. Can Japan explain whether internationally accepted limits for food additives are considered 
when evaluating the safety of these substances in Japan.  Q53. Does Japan plan to accelerate the approval procedures in place for food additives that are 
widely used around the world but that are s till subject to lengthy and cumbersome approval 
procedures in Japan. 
 
A. For the designation of food additives, evaluatio ns on the health effects of food by the Food 
Safety Commission (FSC) and subsequent discussions on specifications and standards at the Ministry 
of Health, Labour and Welfare (MHLW), including those at Pharmaceutical Affairs and Food 
Sanitation Council are necessary.  
 The food additive safety evaluation by the FSC has been steadily implemen ted referring to scientific 
evaluations performed by the FAO/WHO Joint Expert Committee on Food Additives (JECFA) and the 
latest information available from inside and outside Japan.   WT/TPR/M/211/Add.1 
 Page 183 
 
 
  Various other efforts are also being undertaken by the MHLW, such as the improvement of the 
efficiency of Council meeting procedures, in ord er to accelerate the designation procedures for the 
approval of food additives. 
 
Q54. When would Japan allow the imports of beef and other products from EC Member States and 
thus apply the same treatment as for other WTO Members? 
 
A. The process of lifting the import ban on beef originated from EC Member States is to be 
carried out following the same steps as those for other WTO Members.  
In regard to imports of bovine meat and offal from  BSE affected countries, Japan, with the intension 
of setting out as the trade requirements, requires a risk assessment that takes due account of the OIE 
code.  Japan has already presented the necessary steps to the EC and is currently working with 
several EC Member States that have requested the lifting of import bans towards science-based 
solutions.  
Considering that the progress of discussion varies among Member States and that the issues to be 
discussed depend on the various requests of the Me mber States and on answers to questionnaires, we 
are unable to indicate any timeframe. 
 
Q55. Could Japan please confirm that it effectiv ely and correctly applies regionalisation for 
importing countries so that the trade can still ta ke place under the rules set down by the OIE 
concerning avian influenza? 
 
A. In regard to the application of regionalisation for avian influenza, taking into account the 
OIE code, Japan requires that assessments be made regarding the effectiveness of sanitary measures 
under consideration.  These assessme nts take into account the epid emiology of avian influenza, 
environmental factors, applicable biosecurity measures and the Veterinary Services authorities, 
including laboratories.  When requested to appl y regionalisation for avian influenza, Japan will 
conduct a risk assessment in accordance with the procedure entitled "Standard procedure for 
consideration on requests for import designated items to be quarantined into Japan," which has been 
notified as "G/SPS/N/JPN/207."  
 Q56. The WTO Secretariat's Report outlines chang es to the labelling and packaging requirements 
that have been recently introduced.  Introducing these new origin labelling requirements for ingredients in processed foods would be 
impracticable for business.  Would Japan agree th at if some products use ingredients from many 
different countries and/or change ingredients th roughout the season, origin labelling may not be 
feasible?  
A. Japan has introduced new requirements that ca ll for producers of packed or bottled green tea 
beverages and fried peanuts to label the place of th e origin of main ingredient of their products, 
following the Quality Labeling St andard for Processed Foods.  Before introducing the requirements, 
Japan fully discussed their feasibility among domestic  stakeholders, including consumers, producers, 
distributers and academic experts.  Japan also notified these changes to WTO Members for consultation on 29 May 2007 (G/TBT/N/JPN/208) and took into account comments on the 
introduction. 
 
Furthermore, due to high public interest in orig in labeling, the possibility and feasibility of the 
alternative method of origin labelling for ingredient s is currently being discussed in the Joint Meeting 
on Food Labelling. 
 WT/TPR/M/211/Add.1 
Page 184  
 
  Q57. Paragraph 76, the WTO Secret ariat's Report refers to the FY  2005 twice.  Would the correct 
reference not be the FY 2006? 
 
A. It is not clear why the WTO Secretariat refer s to the number of FY2005.  Japan can confirm 
that the ratio of the direct tax revenue to the total tax revenue was 60.3% in FY2005 (settlement 
account) and 59.4% in FY2006.   
Q58. The last part of paragraph 80 on taxation and tax-related assistance states that "tax treatment 
of interest received by non-residents was changed;   and the portion of the interest income on bonds 
issued by a foreign company, which attributes to  a business conducted in Japan, is now treated as a 
domestic source income and taxed as such." 
 We understand that the last sentence should rather r ead "the portion of the interest income on bonds 
issued by a foreign company, which can be attri buted to a business conducted by that company in 
Japan, is now treated as domestic source income and taxed as such."  
 
Can Japan confirm that this is the accurate reading?  
A. The reading made by the EC is com patible with the understanding of Japan. 
 
Q59. Could Japan confirm that this principle w ill be reflected in the revision of the Airport 
Development Law as well as the principles of transparency and proportionality? 
 
A. Japan intends to privatize the Narita Inter national Airport Corporation on a step by step 
basis and to introduce a non-discriminatory regulation for large capital control. 
 Q60. Given that these reforms may have an impact on WTO, in particular with regard to the WTO 
Agreement on Technical Barriers to Trade, could Japan  describe the main elements of these reforms?  
 
A. The basic plan for promoting consumer policy, including the establishment of a new 
"Consumer Affairs Agency," was endorsed by the Cabine t on June 27, 2008.  Based on this plan, the 
bills for the establishment of the agency submitted to the Diet on September 29. 
 
The "Consumer Affairs Agency" is planned to be a governmental organization that acts as a control 
tower for consumer policy.  It will concrete with ot her Ministries on the jurisdiction of laws related to 
consumer policy.  
 Q61. Has there been any regulatory reform in the area of environmental policy of Japan, in 
particular climate change related policy, that has an impact on WTO?  
A. Japan has not introduced any regulatory reforms  in the area of climate change policy that 
have had an impact on WTO activities since the previous Trade Policy Review.  The only regulatory reform taken in the area of climate change policy si nce the last Review was an amendment to the "Act 
on Promotion of Global Warming Countermeasures" adopted on 13 June, 2008.  This act does not 
have any impact on trade. 
 
Q62. Does Japan foresee in the near future any fu rther specific initiatives to strengthen competition 
policy in order to bring more competition to the market place and facilitate access for new entrants, 
including foreign companies? 
 
A. The JFTC has increasingly strengthened comp etition policy through the strict enforcement of 
the Antimonopoly Act and the development of an effecti ve competition regime in order to promote fair 
and free market competition.  With a view to pursu e further effective and rigorous enforcement, the  WT/TPR/M/211/Add.1 
 Page 185 
 
 
  JFTC will submit to the Diet in this session an amendment bill of the Antimonopoly Act which 
includes measures to enlarge of the scope of surcharges, apply 50% higher rates to ring-leaders of 
cartels and bid-rigging operations and introduc e pre-notification system for business mergers 
occurring through share acquisition. 
 Q63. Will the new amendment to the Anti-Monopoly Act be submitted to the current Diet Session?  
Could Japan give details on the main differences  between the amendment su bmitted in 2008 and the 
amendment to be submitted in 2009?  
A. The new amendment to the Antimonopoly Act w ill be submitted to this ordinary session of the 
Diet in 2009.  In regard to this amendment bill, J apan is now considering, am ong other proposals, to 
review current hearing procedures, in addition to the proposals made in the amendment bill submitted 
to the Diet in 2008. 
 
Q64. With regard to the thresholds used for me rger screening, could Japan indicate whether it will 
increase the target's sales threshold to ¥5 billion (so that for transactions  falling below these sales 
minimums, parties will not be required to seek the FTC's approval in advance), with an eye toward 
further concentrating on large deals that could adversely affect competitive conditions? 
 
A. The JFTC is now planning to increase the ta rget's sales threshold to ¥5 billion and is 
coordinating within the Government so that it can submit the new Antimonopoly amendment bill to 
the current Diet session in 2009.   
Q65. Could Japan indicate whether the handling of appeals of decisions by the Japan Fair Trade 
Commission will be transferred to the court system?  A. The JFTC is now reviewing the hearing procedure that is to be reflected in the new Antimonopoly Act amendment bill.  The JFTC is exam ining the pros and cons of the procedure, and 
taking into consideration various comments from relevant sectors. 
 
Q66. If on cartels and bid-riggings, the possibility were offered in the new AMA amendment to be 
submitted to the Diet by the end of March 2009 for companies to attack Japan Fair Trade 
Commission's decisions in Court, is the Government of Japan confident that this would not slow down 
the implementation of competition policy and thus w eaken it? Are Courts well equipped to deal with 
competition cases (in terms of level of expertise of  the judges, speed of the proceedings etc.)? 
 
A. The JFTC is reviewing the hearing procedu res and trying to establish an appropriate system 
which would not slow down or weaken the implementation of Japan's competition policies.  Yes, the 
courts are well equipped to deal with competition cases. 
 
Q67. Could Japan clarify the working mandate given to this Corporate Governance Study Group?  
A. Working mandate is not given to the Corpor ate Governance Study Group.  This study group 
was established within the Ministry of Economy, Trade and Industry with the cooperation of the 
Financial Service Agency, Ministry of Justice and To kyo Stock Exchange, Inc. in order to submit a 
report on an issue of corporate governance in Japanese corporations.  Since this study group is still 
holding discussions, the final content of the report of the study group has not been decided at this moment.  
 
Q68. Can Japan confirm that the final objective of this study group is the revision of the Corporate 
Law or a listing regulation to be impl emented by the Tokyo Stock Exchange? 
 WT/TPR/M/211/Add.1 
Page 186  
 
  A. As stated above, this study group was establis hed in order to submit a report on the issue of 
corporate governance within Japanese corporations.  Japan can not confirm that the final objective of 
the study group is the revision of the Corporate Law or a listing regulation to be implemented by the 
Tokyo Stock Exchange.  
 Q69. Could Japan assure us that importance is give n in this context to a better protection of the 
minority shareholders and present any reforms envisaged in this field? 
 
A. Japan cannot present any envisaged reform of la ws or regulations.  As stated above, this 
study group was established in order to submit a re port on the issue of corporate governance within 
Japanese corporations.  Although im proving corporate governance in order to protect the interests of 
minority shareholders is one of the issues of this study group, the study group is still having 
discussions, and the final content of the report has not been decided at this moment.  
 
Q70. Could Japan provide an update on the schedule and timeline for the adoption of the 
International Financial Reporting Standards? 
 
A. Since October 2008, Japan has been deliberating the use of IFRS, including its time schedule 
at the Business Accounting Council, an advisory bod y to the Commissioner of the Financial Services 
Agency (FSA).  On 4 February 2009, Japan released a draft interim report for public consultation.  
 Q71. Could Japan please give details on how it ensures that the brand names of its premium brands 
that are often linked to regional characteristics (Kobe Beef, Yubari Melons etc.) are properly 
protected in third countries?  
A. Within FY 2009, Japan is preparing to estab lish the system to monitor the applications for 
trademark registration in third countries.  
Q72. The WTO Secretariat's Report details the footwear tariff scheme.  The current leather footwear quota restriction is 12,019,000 pairs acco rding to the Japan Tariff Association, which is 
exactly the same figure as for 1996.  Imports exceeding the quota level are being charged either at an 
ad valorem  duty of 30% or a specific amount of 4,300 ¥/pair, whichever is higher. 
 
Does Japan contemplate removing or otherwise increasing the tariff quota on leather and leather footwear?  
A. In regard to the tariff quota on leather and leather footwear, Japan has no concrete plan to 
reform the existing tariff quota or increase its current volume due to the historic and social difficulties 
confronting this sector.  
 
Q73. Could Japan explain the content of these programmes?  
A. Japan's policies for the development of the m anufacturing industry are fully compatible with 
its obligations under the WTO Agreement.  Japan's subsidies related to aircrafts can be found in 
Japan's notification(G/SCM/N/155/JPN), pursuant to Article 25 of the Agreement on Subsidies and 
Countervailing Measures.  The most recent st atus of the subsidies are as follows: 
 - The annual amount budgeted for "Subsidy of Ex pense to Investigate the Development of Next 
Generation Airplanes" is: 
 - Fiscal year 2006 (final results): ¥165 million; and  - Fiscal year 2007 (final results): ¥155 million.   WT/TPR/M/211/Add.1 
 Page 187 
 
 
  - The annual amount budgeted for "Assistance for Development of Civil Aircraft" is: 
 - Fiscal year 2006 (final results): ¥834 million; and  - Fiscal year 2007 (final results): ¥1,050 million. 
 
Q74. Could Japan explain the rationale for this refusal? 
 
A. Based on the Foreign Exchange and Fo reign Trade Act (FEFTA), Japan reviewed a 
notification submitted by a foreign investor on 15 Jan uary, 2008 regarding a pl anned investment to a 
wholesale electric power company.  After a thor ough review, it was determined that, if the investment 
was implemented, there was a possibility of it having an adverse effect on the construction and 
operations of nuclear power plants under constructi on at the time and, consequently, on the stable 
supply of electric power and nuclear  and nuclear fuel-cycle policies.  Thus, Japan recommended that 
the foreign investor discontinue the planned invest ment on 16 April 2008.  Since the foreign investor 
refused to accept the recommendation on 25 April 2008, Japan orders for the foreign investor to 
discontinue the planned investment on 13 May 13 2008.  
 
Q75. Could Japan explain why it considers the Japan  Post Insurance Co. to be privately owned, 
although it is fully owned by a holding company under state control?  
A. Japan Post Insurance started its business in October 2007, when Japan Post was privatized. 
Under the Law of the Privatization of Postal Service s, Japan Post Holdings is obliged to dispose of 
all of the shares it holds in Japan Post Insurance no later than 30 September 2017.  
Q76. Could Japan explain how it will ensure that  companies, including foreign companies, can 
compete on equal terms in the insurance market?  A. Japan Post Insurance (JPI) is subject to the same laws and regulations ,including the Insurance Business Law, applied to private insu rance companies.  In addition, the Law of the 
Privatization of Postal Services imposes busin ess restrictions on JPI during the privatization 
transition period.  Under the law, the Prime Minister and the Minister of Internal Affairs and Communications shall approve business expansions if it determined that  there is no risk of impairing 
fair competitive relationships and appropriate provis ion of service to users, taking into consideration 
circumstances affecting competitive rela tionships and JPI's business conditions. 
 
Q77. The Mutual Insurance (Kyosai) are not regul ated by Financial Service Agency (FSA). These 
used to be small scale, mutual businesses but , according to the Japan  Cooperative Insurance 
Association, they actually sell nearly 25% of all life insurance policies and account for 30% of all 
insurance premiums for non-life insurance policies in Japan. 
 Does Japan plan to restore a level playing field between insurances regulated by the FSA and the 
Kyosai?  
A. The kyosai activities conducted by cooperati ves are based on a system of mutual aid 
associations composed of me mbers circumscribed by region or workplace, which contribute 
premiums and utilize businesses between each other.  The kyosai activities are conducted as a part of 
wide range of reciprocal help activities (joint proj ect, loan, welfare service) of members.  Therefore, 
these activities are of a different nature from those of commercial insurance businesses that target the 
general public.  Thus, it is not a ppropriate to apply the Insurance Business Law to kyosai providers as 
in the case with private insurers.  These kyosai activities are subject to regulatory supervision by the 
competent authorities within the confines of the relevant laws. 
 
Q78. Could Japan explain why conducting insuran ce business as well as commercial presence per 
se of insurance companies has to be auth orized by the Prime Minister himself? WT/TPR/M/211/Add.1 
Page 188  
 
  A. Japan takes particular note of securing th e sound and appropriate m anagement by persons 
who conduct insurance business, considering the pub lic nature of insurance business.  Therefore, 
Japan has adopted a license system for insurance bus iness, from the view point of policyholder 
protection.  When a person who conducts insurance business abroad, pursuant to foreign laws and 
regulations, conducts its business in  Japan, Japan will examine said person's financial basis, based 
on our license criteria.     
Q79. As noted by the WTO Secretariat's Report,  The Financial Instruments and Exchange Act 
(FIEA) provides that foreign securities firms ar e allowed to conduct certain securities-related 
businesses through agencies or intermediary of secur ities firms within Japan only on condition that 
the foreign firms make no solicitation. 
 Could Japan explain the rationale for this restriction?  
A. When foreign securities brokers conduct financ ial instruments business with Japanese 
residents as customers or their counterparties, they need  to register in principl e the same way as like 
domestic securities brokers. (Article 29 in FIEA)  Therefore, foreign securities brokers (persons which are governed by the laws and regulations of a 
foreign state and which engage in securities-relate d business in a foreign state) can not conduct 
business with a person in Japan as their counterparty  unless they register a principal branch as the 
financial instruments business base domiciled in Japan. (2 of 58 in FIEA) 
 However, there is an exceptional provision.  Non-registered foreign securities brokers who do not 
have bases in Japan are allowed to conduct secu rities-related business through an agency or 
intermediary service of domestic s ecurities companies without soliciting domestic customers.  (The 
Order of FIEA Article17 3-2) 
 This means that if their counterpart is a secu rities company, the Financial Services Agency can 
supervise them through the securities companies without their registration.  Therefore, there is no 
problem for investor protection.  
However, to soliciting domestic customers is within  the scope of conductin g financial instruments 
business with the person domiciled in Japan as a c ounterpart.  In such a case, Japan requires the 
foreign securities broker to regist er the same way as like domestic  financial instruments business 
operators.  
 Q80. The WTO Secretariat's Report in para. 49 describes Japan's disclosure requirements in 
securities industry.  How would Japan justify the cumbersome procedures for companies to submit to the Prime Minister 
extra reports concerning their sales or acquisitions of securities abroad? 
 A. When a corporation that must submit financia l statement reports offers or sells securities 
abroad, it is not obliged for such a corporatio n to submit extra reports.  However, when a 
corporation that must submit financial statement rep orts offers or sells abroad securities of such a 
corporation, the corporation is required to submit to  the Prime Minister, without delay, extra reports 
describing the content of the offering or selling in the light of investor protection. 
 
Q81. Are there any restrictions on the basis of do mestic legislation if foreign investors intend to 
participate in the Japanese telecommunication sector?   WT/TPR/M/211/Add.1 
 Page 189 
 
 
  A. Foreign capital participation in the teleco mmunications market in Japan is basically open 
and non-discriminatory, and no less favorable treatm ent is accorded to fo reign investors except for 
investments in NTT.  As NTT East and NTT West  retain the paramount telecommunications networks 
which are essential for securing people's lives an d indispensable for assuring national security, 
foreign capital restriction applies to the NTT holding company, which owns all of NTT East and NTT 
West shares, based on the Law Concerning Nippon Telegraph and Telephone Cor poration, Etc. (Law 
No. 85 of 1984).  
 
Q82. WTO Secretariat's Report describes developments in Japan's telecommunications sector including positive trends that could be attributed to recent liberalization.  However, according to 
JFTC, the Japanese market for fixed and mob ile telecom services is still characterized by 
"monopolistic situations".  In view of such persistent monopolistic tendencies, would Japan explain how it intends to reform its 
telecommunication sector further? 
 
A. Japan released the New Competition Promo tion Program 2010 in September 2006 as a 
roadmap of measures to be implemented by the earl y 2010s.  The Program aims to further promote 
competition in telecommunications markets, and incl udes a review of designated telecommunications 
facilities systems, a review of calculation methods  for interconnection charges of NTT East and NTT 
West, development of interconnection rules for the Next Generation Network established by NTT East 
and NTT West, and other relevant measures.  Taki ng account of the results  from the competition 
reviews in the telecommunications sector which have been taking place since FY 2003, Japan aims to 
further ensure a fair competition environment thr ough the steady implementation of the Program.  
 Up to this point, the JFTC has never expressed its views that fixed and mobile telecommunication 
businesses meet all the conditions of "monopolistic s ituations" defined in the Anti-monopoly Act. 
 
Q83. In the same paragraph, the WTO Secretar iat's report notes that "Between August 2006 and 
February 2008, there was a net increase of 518 telecommunication carriers in the market, to 14,441 carriers."  
Can Japan indicate in which services markets there is a high number of carriers? 
 
A. In accordance with Article 9 or Article 16,  paragraph 1 of the Telecommunications Business 
Law, telecommunications carriers a re required to register with or notify the Ministry of Internal 
Affairs and Communications.  Japan does not keep an accurate record of the individual services 
markets, and therefore can not specify the servi ces markets with high numbers of carriers.  
 
Q84. The Report goes on to note that "in terms of  sales and traffic, the partially state-owned 
Nippon Telegraph and Telephone (NTT)  Corporation continues to dominate the telecommunications 
market, except for traffic in long-distance telephone services." 
 
Can Japan indicate what measures it plans taking to address the issue of the dominant position of NTT 
in the local, but also in the long distance markets? 
 
A. In order to properly reflect the market situa tions into the telecommunications policies, Japan 
has been conducting a competition reviews in the telecommunications sector since FY 2003.  The 
results of the competition review in 2007 for loca l and long-distance telephone services pointed out 
that the NTT Group, which includes NTT East, NTT West, and NTT Communications still has significant market power either alone or jointly in su ch markets based on the number of contracts, but 
that such power will not be exercised as there exi st potential competition p ressures by the carrier-pre-
selection system, low-cost 050-IP-based telephony, and such.  WT/TPR/M/211/Add.1 
Page 190  
 
  Japan released the New Competition Promotion Progr am 2010 in September 2006 in order to further 
promote competition in the telecommunications sector which includes a review of designated 
telecommunications facilities systems and a review of calculation methods for interconnection 
charges of NTT East and NTT West.  Taking acc ount of the results from the competition review, Japan 
aims to further ensure a fair competition envir onment through the steady implementation of the 
Program.  
 
Q85. The Report goes on to note that "in terms of  sales and traffic, the partially state-owned 
Nippon Telegraph and Telephone (NTT)  Corporation continues to dominate the telecommunications 
market, except for traffic in long-distance telephone services." 
 
Is Japan planning to establish a ge nuine independent regulator for telecommunication to replace the 
Ministry of Internal Affairs and Communications?  
A. The Ministry of Internal Affairs and Comm unications (MIC) is legally and structurally 
independent and, as stipulated in Article 5 of the Telecommunications Reference Paper of the Fourth 
Protocol to the GATS, it is ensured that MI C is separate from, and not accountable to, any 
telecommunications services suppliers.  Taking a ccount of the current situation of the 
telecommunications sector in Japan, fair compe tition is properly ensured and significant progress has 
been made in the telecommunication market under th e current administrative structure.  Thus, Japan 
is not planning to review the current government al structures related to telecommunications. 
 
 
PERU  
 
Q1. Summary Observations (paragraph 6)  It is stated that "the only major change in Japan 's government ministries and agencies responsible for 
the formulation, implementation and evaluation of its trade policies since its previous Trade Policy 
Review" was the abolition of the Japan Investme nt Council and the establishment of the Expert 
Committee on FDI Promotion.  Peru would like to know what are the main consequences of this 
change.  What are the new functions of the Comm ittee and which of its previous responsibilities does 
it no longer exercise?  What was the main reason for th is change and to what extent has it contributed 
to improving Japan's integration in to the multilateral trading system? 
 
A. At the end of 2007, the Chief Cabinet Secret ary gave instructions to  reduce the number of 
councils of which the Prime Minister and the Chie f Cabinet Secretary were members.  Consequently, 
the Japan Investment Council was abolished in Dece mber 2007.  However, Japan needed to continue 
to endeavor to meet the goal to double FDI by 2010 and newly established the Expert Committee on 
FDI Promotion, an advisory body for the Minister of State for Economic and Fiscal Policy, in 
January 2008.  The change was simply an organizational reform without policy alteration.  Japan 
continues to implement measures in order to ac hieve the goal to double FDI into Japan by 2010. 
 The main function of the committee is gathering information on the improvement of the Japanese 
investment environment and studying policies relevant to the promotion of investment.  The Expert 
Committee published "Five Recommendations To ward the Drastic Expansion of Foreign Direct 
Investment in Japan" in May 2008 to promote furth er FDI into Japan.  Please refer to the website 
below for more information. http://www5.cao.go.jp/invest-japan/index.html 
 
Q1-2. Summary Observations (paragraph 11) 
  WT/TPR/M/211/Add.1 
 Page 191 
 
 
  1) Concerning the adoption of measures to make investment more attractive for foreign firms, 
Peru would like to know what those measures are.  2) Moreover, since the Government of Japan cons iders that investment in electricity services is 
not desirable on grounds of public order, public safety and national security, Peru wishes to know 
what other sectors are treated in the same way and therefore made subject to the limitation or 
prohibition of FDI.  
A. 1) To achieve the goal that was set in March 2006 to double FDI amounting to around 5% of 
GDP in five years by the end of 2010, in June 2006 Japan launched a program  called the "Program 
for the Promotion of FDI in Japan" which focu ses on 3 key issues: (1) Promote investment in local 
regions (2) Improve comprehensive investment en vironment with sense of urgency (3) Promote 
greater understanding by pub lic information activity.  
 To promote further FDI into Japan, in May 2008, Japan issued "Five Recommendations Toward the 
Drastic Expansion of Foreign Direct Investment in Japan" and in December 2008 revised "the 
Program for the Acceleration of Foreign Direct Investme nt in Japan" in order to incorporate the Five 
Recommendations in the program.  The recommendations and the program are available at:  http://www5.cao.go.jp/invest-japan/index.html 
 
2) Although the Foreign Exchange and Foreign Trade  Act requires notification of investment in 
sectors listed on Table A II.3, it does not prohibit the foreign direct investment.  Concerning telecommunication, broadcasting and airline secto rs, foreign direct investments by foreigners or 
foreign-controlled enterprises are limited based on relevant individual sector-specific laws. 
 
Q1-3. Summary Observations (paragraph 12)  Although "it would appear that Japan has not intr oduced new trade measures to protect its market 
since the onset of the global financial crisis", Peru wishes to know whether the Japanese Government 
is envisaging the possibility of adopting and implem enting certain measures, and if so, what those 
measures would be, given the contraction of demand from the United States and the European 
Communities, two of Japan's main trading partners, which would generate a de terioration in its trade 
balance.  
A. Given the current economic crisis, it is necessa ry to counter the emergence of protectionism. 
Japan has therefore made a stands till commitment against the introduc tion of new trade measures 
intended to protect the Japanese market, as has been stated in declarations made at the Summit on 
Financial Markets and the World Economy, APEC Ec onomic Leaders' Meeting, and Japan-China-
ROK Trilateral Summit.  
 
Q1-4. Summary Observations (paragraph 16);  Trade Policies and Practices by Measure 
(paragraph 71) 
 Since Japan reserves the right to apply export cont rols to ensure adequate supplies of certain 
agricultural products, Peru would like to know what  Japan takes "adequate supplies" to mean and 
what significance was attached to "a dequate supplies" of different products in recent years.  It also 
wishes to know what types of controls have been  applied to exports in these cases and whether they 
would also be applicable to countries with which Japan has signed free trade agreements. 
 
A. The main purposes of Japan’s export controls  are to preserve limited natural resources and 
ensure national security. The achievem ent of these goals requires that export controls be applied to WT/TPR/M/211/Add.1 
Page 192  
 
  certain products. With regard to agricultural products , a very limited range of products, such as by-
products used for animal feed, are subject to the exp ort controls. Export controls are also applied to 
products going to countries which have si gned free trade agreement with Japan.  
 
Q1-5. Summary Observations (paragraph 27) 
 
Concerning the liberalization of the gas market, Peru  is interested to know what measures Japan has 
taken to promote and provide incentives for competition in this sector. 
A. In order to invigorate the gas market and pr omote competition, it was necessary to promote 
the construction of pipeline networks and connectio ns between independent networks, while further 
facilitating the use of pipeline networks by third par ties in a fair and transparent manner.  For this 
reason, the Government of Japan established "wheel ing services" in 1999, which enabled the utilities 
without their own pipelines to enter the gas market  and to supply gas.  Also, the gas supply business 
conducted by way of large-capacity pipelines was established as a new business category under the 
name of "gas pipeline service business" in 2003.  As for third party access (TPA) on LNG terminal, 
the Government of Japan sets the guidelines whic h require LNG terminal owners to define the 
negotiation rules on TPA, as well as the adequate discl osure of information on terminal operation.  
 
Q1-6. Summary Observations (paragraph 31)  With regard to Japan's rapidly ageing population a nd the consequent decline in the labour force, with 
attendant problems in the area of pensions, Pe ru wishes to know whether Japan has envisaged 
adopting any programme to promote legal migration or the regularization of the situation of illegal 
immigrants with a view to fully incorporating them  into Japan's mainstream labour market and thus 
avoiding any further increase in the average age of the Japanese population. 
 A. In Japan's view, it is not appropriate to accept foreign workers to cope with the labor 
shortage resulting from the falling birth rate and aging population.   First and foremost, it is 
important to facilitate the entry of senior citizens and women in the labor market through the 
improvement of the employment environment,  labor saving, efficiency, and management.  
 In addition, it is not appropriate to grant stat uses of residence uniformly to foreigners staying 
illegally in Japan, because it may cause an infl ow of more illegal entrants and an increase of 
overstayers in the future.  
 
Q2-1 Is there a single electronic portal for th e publication of all information on tenders? 
 A. There is no single electronic portal which covers all entities in Japan's Annexes of the GPA. 
For the central government entities, th ere is a single portal where relevant information is available in 
English.  Local governments covered by the GP A publish notices of intended procurements in 
accordance with the provisions of the agreement.  Although no specific plans have been drafted yet, 
the Japan does intend to enhance access points. 
 Q2-2. Does Japan grant preferences or credits to national suppliers in case where procurements are 
not covered by the GPA?  
A. Open tendering is the basic bidding procedu re for government procurement in Japan.  This 
principle is equally applied whether the procurem ent is covered by the GPA or not.  In addition, 
Preferences or credits are not granted to national suppliers.  
Q2-3. What type of government procurement scheme (legislation, preference, etc.) is applied by 
local/municipal governments?  WT/TPR/M/211/Add.1 
 Page 193 
 
 
  A. Procurements by local governments are c onducted pursuant to the "Local Autonomy Law" 
and other related regulations. 
 
Q2-4. Are any types of tendering reserved exclusivel y to a specific sector or group (e.g. SMEs)? 
 A. Government procurement in Japan is usually conducted through open tendering.  As an exception, 
Note 3 in the Annex 1 and Note 3 in Annex 2 to Japan's Appendix I under the Agreement on 
Government Procurement provides t hat, "This Agreement shall not apply to contracts to be awarded 
to co-operatives of associations in accordance with laws and regulations existing at the time of the 
entry into force of this Agreement for Japan." 
 
In regard SMEs, Japan enacted the "Law on Ensuring the Receipt of Orders from the Government 
and Other Public Agencies by Small and Medium Enterprises" (hereinafter "the Law") as a SME promotion policy.  The Law states that the Ce ntral Government, local authorities and other public 
agencies shall endeavor to expand procurement opportunities for SMEs.  Japan also sets a "Policy of 
contracts by the Government and other public age ncies" based on the Law every year, and requests 
local authorities to apply pursuant to the policy.  However, there is no te ndering that exclusively 
reserved for SMEs. 
 
Q2-5. Can bids be submitted electronically?  A. Electronic procurement is available for the entities in Japan's Annex 1.  Electronic bidding 
systems for tendering and opening bidding procedu res have been installed at each government 
ministry's website.  Japan will further develop a unified system that will integrate these separate ministerial e-bidding 
systems and introduce digitized contract procedures.  The details of the design of the new system are 
expected to be finalized by the end of FY2008.  Operation of the new system will be started in FY2009 at the earliest.  
 
Q2-6. Assuming that the market is an open one, why has there been no significant increase in the 
award of contracts to foreign companies? 
 
A. In regard to the Action Program referred to in  the report by the secretariat, the ratio of 
foreign supplier's awards, in terms of value, s lightly decreased by 0.6%  from 2004 to 2006. 
Meanwhile, in terms of the number of contracts, that ratio was 3.0% in 2006, increasing from 2.0% in 2004.  The government of Japan has no further detailed analysis of these statistical trends. 
 
Q3. What is Japan's policy regarding the nego tiation of temporary entry clauses for natural 
persons under short-term migr ation commitments in its b ilateral trade agreements? 
 
A. Regarding the basic policy on the said point in EPA negotiations, Japan holds the view that it 
is important to take into account whether or not  the acceptance of professional or technical workers 
could be further promoted between the negotiati ng parties, thereby stimulating Japan's economy and 
society and promoting its further internationalization. 
 
Q4-1. As is pointed out in the preliminary trade policy review (TPR) document, agrarian reform in 
2007 concentrated on the farmland of principal farm ers in order to strengthen the structure of 
Japanese agriculture and the establishment of th e "strategy for preventing global warming". 
 Japan is promoting exports of agricultural products  by means of a drawback scheme to refund import 
tariffs levied on inputs used in the production of  goods for export.  Export finance, insurance and 
guarantees are also available. WT/TPR/M/211/Add.1 
Page 194  
 
  In this connection, further information is re quested about the farm management stabilization 
programme for farmers adopted in 2008.  Does this stabilization programme seek to maintain a stable 
level of production in order to guarantee food security , maintain an adequate level of employment in 
this sector, and also to provide a price stabilization fund?  A. The new direct payment system (the manage ment stabilization programme for farmers), 
introduced in 2007, seeks to promote efficient and st able agricultural management.  For the detailed 
information, please refer to the Report by  the Secretariat (page 71, paragraph 6). 
 
Q 4-2. Peru also wishes to know what price and in come support measures are in force in Japan.  
 
A. The main price support schemes are indicated in  Table IV.3 (page78).  Japan maintains price 
supports for beef/veal and the meat of swine, which is mentioned in para 20 (page76) of the Report by 
the Secretariat.  
In addition, as a main income support measure, the new direct payment system was introduced in 
April 2007 for rice, wheat, barley, soybean, s ugar beet and potato for starch.  For detailed 
information, please refer to the Report by the Secretariat (page71, paragraph 6). 
 
Q4-3. Peru also wishes to know what reforms are planned in the context of the Doha Development 
Round negotiations.  
 
A. Japan is going to examine various aspects surrounding agriculture and rural areas in Japan, 
in order to strengthen the capacity of the food su pply, promote the rural economy and safeguard food 
safety and consumer confidence.  
 Q4-4. The Peruvian Ministry of Agriculture (MINAG) requests fuller information about the 
management and volume of allocated quotas, in  the WTO framework.  How are quotas managed 
under bilateral agreements:  do the allocated vol umes form part of the WTO quotas or are they 
exclusively allocated under the bilateral agreement? 
 
A. TRQs under FTAs (EPAs), are sets in each ag reement, and are different from the quotas set 
as TRQs in the WTO.  The TRQ for agricultu ral products under FTAs (E PAs) is appropriately 
administrated, and is cons istent for each FTA (EPA). 
 
Q4-5. Japan notified the WTO that in the period between 1 April 2006 and 31 March 2007 no export subsidies had been provided.  Could Japan indicat e whether export subsidies were granted during the 
period from 1 April 2007 to 31 March 2008? 
 
A. Japan granted no export subsidies between 1 April 2007 and 31 March 2008 for agricultural 
products. 
 
Q5-1. What is Japan's policy regarding the regist ration of foreign appellations of origin?  What 
foreign appellations of origin are recognized by Japan? 
 
A. A place of origin for Sake (seishu) in the territory of any WTO Member other than Japan may 
be designated as a geographical indication(GI) by the Commissioner of the National Tax Agency if it fulfills the following requirements: 
 
(1) The place of origin meets the definition of GI  referred to in paragraph 1 of Article 22 of the 
TRIPS Agreement. 
(2) The place of origin is protected as  a GI in the territory of a WTO Member. 
  WT/TPR/M/211/Add.1 
 Page 195 
 
 
  In terms of places of origin for wines and spir its, the Commissioner of the National Tax Agency may 
designate places of origin only in Japan.  A lthough Japan does not have a designation system for 
places of origin for foreign wines and spirits, GIs fo r wines and spirits in the territories of other WTO 
Members are protected according to the provisi ons of Article 23 of the TRIPS Agreement. 
 
Additionally, Japan recognizes some foreign indications for spirits as GIs referred to in paragraph 1 
of Article 22 of the TRIPS Agreement in  some Economic Partnership Agreements. 
 (As of February 2009, Japan agreed to six GIs, in cluding "Tequila" (Mexico), "Mezcal" (Mexico), 
"Sotol" (Mexico), "Bacanora" (Mexico), "Charanda"  (Mexico) and "Pisco Chileno (Chilean Pisco)" 
(Chile).)  
Q5-2. What measures is Japan taking to prevent the patentability of pirated biological products? 
 
A. In Japan, examiners refuse applications if ap plications, including applic ations on biological 
products, do not have novelty and inventive step.  
 In order for examiners to judge pa tentability, prior arts which are publicly known, publicly worked, 
or described in a distributed public ation in Japan or a foreign country prior to the filing of the patent 
application, are taken into account. 
 Q6-1. In paragraph 52, it is stated that "t he higher TFP growth in the 'information and 
communications' sector may be attributed to the re cent liberalization of Japan's telecom sector, which 
intensified competition".  We would like to know what pro-competition measures have been adopted 
in the sector.  We would also like to know whethe r Japan authorizes resale and infrastructure sharing 
in the field of telephony. 
 
A. Since the late 1990s, Japan has been developi ng competition rules so that market mechanisms 
will properly function in the telecommunications sect or. Japan relaxed relevant restrictions including 
foreign investment regulations, introduced rules for access to NTT East and NTT West networks, and 
restructured NTT.  Furthermore, Japan reformed entry regulations dramatically and deregulated 
price and tariff regulations in 2004, as well as es tablished the annual competition review scheme in 
the telecommunications business fields.  All of these are a shift from ex-ante regulations to ex-post 
regulations.  Japan is now further promoting competition in the telecommunications market by undertaking 
reviews of designated telecommunications facilities systems, calculation methods for interconnection 
charges of NTT East and NTT West, and other relevant rules, based on the New Competition 
Promotion Program 2010, which was set in Sept ember 2006 as a roadmap of  measures to be 
implemented by the early 2010s.  The resale of infrastructure is permitted in Japan and  is principally based on the market mechanisms. 
Therefore, there is no detailed rule concerning res ale except for Article 6 (Fairness in Use) and 
Article 29 paragraph1 (x) (Order to Improve Bu siness Activities) under the Telecommunications 
Business Law.  As for the common use of infrastructure, in addition to the rules for access to NTT East and NTT West 
networks, collocation rules are in place so as to enable telecommuni cations carriers to collocate their 
equipment within NTT East or NTT West’s buildings , or install their cables and lines within NTT East 
or NTT West's buildings, condu its, cable tunnels, or telephone poles under certain circumstances. 
 WT/TPR/M/211/Add.1 
Page 196  
 
  Q6-2. Paragraph 54 refers to the provision of universal services.  We would like to know how 
determinations are made as to which companies are to provide universal servic es, and whether there is 
any difference between domestic and foreign firms with  regard to the provision of universal services. 
 
A. Under the current universal service scheme in Japan, subscriber lines, public telephones and 
emergency calls are defined as the scope of the universal service, as th ey are seen as indispensable to 
people's lives and nationwide provision is necessary.  On the other hand, due to rapid changes in 
market situations such as wide  broadband penetration, Japan is revi ewing not only the scope of the 
scheme, but also the scheme as a whole thr ough implementing the "New Competition Promotion 
Program 2010."  
 
Under the scheme, telecommunicatio ns operators who benefit from interconnecting to NTT East and 
NTT West share cost burdens, and there is no discriminatory treatment against foreign operators.   
 
Q6-3. In paragraph 58, it is stated that "the Government reviewed the use of tax measures to 
promote investment ( ... ) and strengthening the in ternational competitiveness of Japanese companies 
[in information systems]".  We would like to kn ow whether a distinction has been made between 
domestic and foreign companies in the ad ministration of any of these measures. 
 
A. The tax system for strengthening informati on infrastructure is applicable to companies that 
file Blue Return Forms.  There is no distin ction between domestic and foreign companies.  
 
Q7. According to paragraph 70, Japan has signed b ilateral air services agreements with 56 trading 
partners and these agreements concern traffic rights and code sharing.  We wish to know whether any 
of these agreements refer to open skies agreements .  We would also like to know what policy is 
followed by Japan with respect of th e signing of open skies agreements. 
 
A. Japan is not engaged in any so-called "ope n-sky" agreements.  Japan, however, is promoting 
an aviation liberalization policy based on the "A sian Gateway Initiative" which aims to remove 
restrictions reciprocally on entry points, and the number of flights related to third and fourth freedom traffic, except for routes linked to metropolitan airports  in Japan due to limited airport capacity.  As 
of 2009, seven Asian countries and regions have en joyed the liberalization based on their existing 
bilateral air service agreements with Japan. Further negotiations with other Asian countries 
concerned will follow.  
 
Q8. It is stated in paragraph 75 that, in additi on to obtaining relevant licences, membership of a 
professional association is compulsory for:  certif ied public accountants, administrative scriveners, 
lawyers, judicial scriveners, land and house survey ors, licensed tax accountants, public consultants on 
social and labour insurance, and patent attorneys.  Peru would like to know whether membership of a 
professional association is compulsory for any other profession.  We would also like to know how professions such as medicine and architecture are regulated.  That is to say, who grants the relevant licences and what are the requirements for obtaining them? 
 
A. There is no profession which requires registra tion with a relevant professional association 
before starting business as a specialist in accor dance with relevant laws, except for certified public 
accountants, certified administrative procedures sp ecialists, registered foreign lawyers, judicial 
scriveners, land and house surveyors, certified public tax accountants, public consultants on social 
and labor insurance, patent attorneys. 
 
A person intending to become a doctor in Japan must pass the Japanese National Medical Examination and obtain a license from the Minister of Health, Labour and Welfare.   WT/TPR/M/211/Add.1 
 Page 197 
 
 
  Those intending to obtain a kenchikushi (a national qualification of architect and building 
engineer)license must pass the qualifying examination and obtain a license from the Minister of Land, 
Infrastructure, Transport and Tourism.  There a re no citizenship requirements for the qualifying 
examination and there is a special measure for academic qualification obtained overseas under the 
kenchiikushi Act. 
 
Q9. Paragraph 77 refers to the fact that foreign participation in the sector is regulated by the 
Practising Attorney Law and the Act on Special Me asures concerning the Handling of Legal Services 
by Foreign Lawyers.  Under the law, a "registere d foreign lawyer" (a foreign lawyer qualified under 
Japanese law) can employ a Bengoshi (a lawyer qua lified under Japanese law) and a joint enterprise 
involving the two is allowed.  In this connection, we would like to know whether any requirements of 
residency or previous experience in Japan have to  be met for a foreigner to obtain registration in 
Japan.  
A. To become a registered foreign lawyer, a forei gn lawyer must be recognized by the Minister 
of Justice as a registered foreign lawyer and be  registered of the Japan Federation of Bar 
Associations.  The conditions for granting recognition by th e Minister of Justice are as follows: 
(i) The service supplier is qualified as  a lawyer in the jurisdiction. 
(ii) The service supplier has engaged himself as a lawyer for at least three years in the 
jurisdiction. 
(iii) The service supplier is not subject to such  conditions of disqualification in the jurisdiction 
which, if applied to Bengoshi, would disqualify the Bengoshi. 
(iv) The service supplier possesses the intention to  undertake the profession in good faith. 
(v) The service supplier possesses plans, residence and financial basis to perform his or her 
functions properly and steadily. 
(vi) The service supplier possesses the capability to co mpensate for damages caused to a client, if 
any. 
 
Q10. According to paragraph 78, accountants must  pass the national examination to qualify as a 
certified public accountant in Japan, while a forei gn accountant not qualified as a CPA in Japan may 
provide auditing services specified in Article 2-2 of  the CPA Act under certain conditions.  We should 
like to know whether it is possible for a foreign account ant not qualified in Japan to take the national 
examination and obtain a licence to act as an accountant in Japan.  
A. The Japanese Certified Public Accountant Ex amination is open to all regardless of 
nationality.  In order to become CPA in Japan, th e CPA Act requires persons to (i) pass the Japanese 
CPA examination, (ii) complete the practical tr aining course, and (iii) work in audit-related services 
for a certain number of years.  The FSA permits the experience of working in audit-related services in 
foreign jurisdictions to be valid in  calculating candidates' experience. 
 In Japan, providing accounting-related services, including compilations of financial documents and 
consultation services relating to finance (but not incl uding the attestation of financial statements), is 
permitted to those who do not have Japanese CPA qualifications;  there are a number of foreign nationals who provide such accounting services in J apan.  In addition, the 200 7 amendments to the 
CPA Act enabled such persons to become partners of  audit firms, provided that certain conditions are 
met.  
 
Q11-1. What are the main sectors in which Jap an has aligned its technical standards with 
international standards?  (Paragraph 48)  
A. Japan has been aligning JIS and JAS to corresponding international standards in all sectors. WT/TPR/M/211/Add.1 
Page 198  
 
  For JIS, Japan has been aligning it to corresponding international standards which exist or if they 
are to be newly established, ensuring compliance with the WTO/TBT Agreement. 
 For JAS, Japan Agricultural Standards Law stipul ates that, in order to establish or revise JAS 
standards, international standards, such as C odex standards, must be taken into account. 
 
Q11-2. What are the countries and economies that  have been certified to affix JIS (Japanese 
Industrial Standards) marks and JAS (Japan Ag ricultural Standards) marks?  (Paragraph 50) 
A. (1) JIS 
 
There are three foreign regi stered certification bodies under the JIS mark scheme: two in Korea, the 
"Korean Standards Association" and "Korea Testi ng and Research Institute," and one in Australia, 
"AWPA Test Centre Association Inc."   There are 432 foreign JIS mark certified manufactu res in 15 countries and economies.  In Korea, 
239;  in China, 75;  in Chinese Taipei, 37;  in Thailand, 27;  in Indonesia, 24;  in all other 
countries, 30.  (2) JAS  Any producer in any countries can attached JAS mark  to its products if certified by a certifying body 
(there are 22 certifying bodies, please refer to the following website for details: 
http://www.maff.go.jp/soshiki/syokuhin/hinshitu/e _label/file/JAS/List_RCO&RFCO.pdf) registered by 
the Minister of Agriculture, Forest ry and Fisheries under the JAS Law. 
 
Q11-3. Can local government institutions in Japan elaborate standards, technical regulations and 
conformity assessment procedures?  If so, are they su bject to the obligations laid down in the WTO's 
TBT Agreement, including the notification obligation?  
A. Local governments in Japan comply with the WTO/TBT Agreement, including Article 3 of the 
Agreement.  
 Q11-4. What is the status of Japan's WTO no tifications regarding its technical regulations? 
 
A. Japan complies with Article 2.9.2 of th e WTO/TBT Agreement and pursues notification in 
accordance with this Article.  
 Q11-5. What transparency procedures are used by Japan for the publication of its technical 
regulations?  Does Japan have a consolidated web page for the publication of such regulations? 
 
A. Japan complies with Article 2.9.1 of th e WTO/TBT Agreement and publishes technical 
regulations through Japan External Trade Organiza tion (JETRO).  Please refer to the following 
website for further details:  http: //www.jetro.go.jp/notice/comment.  
 
Q11-6. What is the period granted by Japan to WTO Members for comments on its draft technical regulations or conformity assessment procedures?  What is the average length of time between 
publication of a technical regulation and its entry into force in Japan? 
 A. Although Japan does not maintain statisti cs on the actual average length of time, Japan 
sincerely implements Article 2.10 of the WTO/TBT Agreement.  
  WT/TPR/M/211/Add.1 
 Page 199 
 
 
  Q11-7. Does Japan have a mechanism for publishing replies to the comments received from WTO 
Members on draft technical regulations or conformity assessment procedures?  
A. Japan does not have such a mechanism for the publishing of its replies to comments by WTO 
members.  When Japan receives comments from WTO Members, J apan responds to them writing and 
submits them to the relevant memb ers through the Japanese Embassy.  
 
Q11-8. What percentage of tec hnical regulations and c onformity assessment procedures are translated 
and published in English?  A. Japan complies with Article 10.5 of WTO/TBT Agreement.  The docume nts or summaries of 
all WTO notifications are available, upon request. 
 
Q11-9. Is there a single institution responsible fo r establishing and administering industrial standards 
in Japan?  If not, what are the main institutions with such responsibilities? 
 
A. The Japan Industrial Standards Committee (JISC) is responsible for establishing and 
administering industrial standards (JIS), based on Industrial Standardization Law.  For further details, please refer to  the following website:  http://www.jisc.go.jp/eng/index.html 
 Q11-10. What supervisory approach is used by Jap an to ensure that the results of conformity 
assessments comply with technical regulations?  Is such supervision conducted at customs or in the 
domestic market?  
A. Responsible agencies monitor the results of  conformity assessments and compliance with 
technical regulations.  Such monitorings are c onducted in customs or in the domestic market, 
depending on the nature of each technical regulation.  
 
Q11-11. What are the main areas and the main means by which Japan offers cooperation in respect of 
technical barriers to trade?  A. Against technical barriers to trade, Japan is hosting a program to help experts from various 
countries, better understand the international standardization activities including technical regulations/standards and compliance with the TBT Agreement, through the Japan International 
Cooperation Agency (JICA).  
The Association for Overseas Technical Scholarship  (AOTS) has also been providing the same 
technical training programs for experts from private sector.   HONG KONG, CHINA
 
 
Q1. It is noted from the Secretariat's report that  foreign banks may enter the Japanese market by 
establishing branches or subsidiaries after obtaining the relevant licence.  While this reflects Japan's 
banking regime in terms of the commercial presen ce mode of supply (Mode 3), would Japan update 
us about its regime for the provision of banking services via the cross border mode of supply 
(Mode 1)?  Is cross border supply of banking services allowed? 
 
A. To conduct banking business in Japan, foreign banks are required under the Banking Act to 
obtain a banking license and to establish a branch or  subsidiary in Japan.  The services allowed 
under Mode 1 are in line with the Japan’s sche dule on specific commitments and there has been no 
change on those. WT/TPR/M/211/Add.1 
Page 200  
 
  Q2. We are pleased to note from the Secretariat' s report that local fixed-line call charges and 
charges for mobile phone services on Japan have falle n to levels comparable with those in other 
developed countries.  Besides, there has been a higher TFP growth in the "information and communications" sector, and this may be attributed to the recent liberalization of Japan's telecom sector, which intensified competition.  This illustrat es well the substantive benefits that liberalization 
would bring to individual sectors and in turn the economy as a whole.  In the light of this, we would 
like to know if Japan has any plan to take out fu rther liberalization measures in the telecommunication 
service sector for the purposes of lowering cost , improving competitiveness and enhancing market 
efficiency. 
A. Based on the "New Competition Promotion Program 2010" (issued September 2006, revised 
October 2007), Japan has implemented the followi ng measures: promotion of facility-based 
competition, review of calculation method for in terconnection charges of NTT East and NTT West, 
review of designated telecommunications facilities system (dominant regulations), promotion of 
competition in the mobile communications market, and so forth.  Japan is promoting further 
liberalization of the telecommunications sector by guaranteeing fair competition through the steady 
implementation of the Program.  
Q3a. We note from the Secretariat's report that in order to mitigate the decrease in the number of 
Japanese-flag carriers, th e Japanese Government provides support for Japanese-flag ca rriers under the 
International Ship Regime through various me asures, including among others, tax breaks and 
preferential tax treatment.  We would like to know more about the support measures under the 
International Ship Regime, in particular, whet her these measures would (a) discriminate against 
foreign services suppliers;  and (b) have any implic ations to Japanese's maritime transport services 
commitments in the GATS.  
A. The preferential tax measures under the International Ship Regime apply only to ship owners, 
not to service suppliers.  Therefore, these measures would not discriminate against foreign services 
suppliers.  
 
Q3b. We note from the Secretariat's report that in order to mitigate the decrease in the number of 
Japanese-flag carriers, th e Japanese Government provides support for Japanese-flag ca rriers under the 
International Ship Regime through various me asures, including among others, tax breaks and 
preferential tax treatment.  We would like to know more about the support measures under the 
International Ship Regime, in particular, whet her these measures would (a) discriminate against 
foreign services suppliers;  and (b) have any implic ations to Japanese's maritime transport services 
commitments in the GATS.  A. The preferential tax measures under the International Ship Regime apply only to ship owners, 
not to service suppliers.  Therefore, these measures would not discriminate against foreign services suppliers.  These measures are not inconsistent w ith the obligation of ma rket access or national 
treatment under the GATS.  Accordingly, these measur es are not stipulated in Japan's revised offer. 
 
Q4. We note that Japan maintains MFN exemptions  for three sub-sectors in maritime transport 
services (cabotage services;  international freight forwarding;  and interna tional shipping services).  
For the latter two sub-sectors, market access and national treatment will be granted on a reciprocal basis.  We would appreciate Japan’s advice on any plan to remove these MFN exemptions.  
A. The right of maritime cabotage has been estab lished internationally from the viewpoint of 
sovereignty and national security of individual countries.   As with many maritime nations, Japan has 
restricted maritime cabotage to Japanese vessels bas ed on the Ship Law and has no plan to relax the 
regulation.   WT/TPR/M/211/Add.1 
 Page 201 
 
 
  With regard to international shipping services,  Japan maintains MFN exemption because Japanese 
shipping companies suffered unreasonable loss due a unilateral sanction in the past and there still 
remains the risk of such a unilateral sanction.  Consequently, the possibility of withdrawing MFN 
exemption depends on the outcome of this round of negotiations. 
 
The reason why Japan has listed international freight forwarding services in its MFN exemption list is 
to ensure fair business activities in this sector whic h has a variety of regulations in foreign countries 
and to grant operation permission or registration on a reciprocity principle.   With regard to MFN exemption, the treatment of this measure will depend on the outcome of this 
round of negotiations.  
Q5. We note from the Secretariat's report that  a foreign accountant not qualified as a CPA in 
Japan may provide auditing services specified in Ar ticle 2-2 of the CPA Act under certain conditions.  
We would be grateful if Japan could provide more detail about this arrangement , particularly the types 
of auditing services that may be provided by such  foreign accountants and the conditions under such 
foreign accountants would be allowed to provide the relevant auditing services. 
 
A. The amendments to the CPA Act in 2007 permit those who do not hold Japanese CPA 
qualification to be partners of audit firms.  This en ables them to work for audit firms as partners, but 
does not permit them to conduct audits on behalf of the firms;  audit reports are invalid unless they 
are signed by qualified auditors who hold Japanese CPA qualification.  However, Article 2-2 of the 
CPA Act allows those who do not have Japanese CP A qualification including foreign accountants, to 
provide accounting services such as compiling financial documen ts and consulting services relating 
to finance.  
 
SINGAPORE
 
 
Q1. Does this recommendation against the FDI pr oposal represent a change in Japan's policy 
against inward investment?  Also are there sectors or  areas in Japan that might have stricter foreign 
investment criteria at present? 
 
A. It is Japan's fundamental policy to continue  liberalization of investment and to promote 
investment. Japan's policy to promote Foreign Dire ct Investment is unchanged.  Under the FEFTA, 
all notifications submitted in  the past have passed the review, except for that case.  
 
There are no sectors or areas in Japan that might hav e stricter foreign investment criteria at present. 
 
Q2a,b,c,d. Paragraph 56 on page 49 of the Secret ariat's Report notes that there have been several 
revisions to Japan's food specifications and sta ndards since 2006.  Could Japan please provide 
information on its import requirements for processed meat-based products that have undergone heat 
treatment (e.g. dried chicken, pork and beef)?  In particular, we would appreciate information on the 
following:  (a) The complete import procedures (control, in spection and approval procedures) for export of 
processed meat products to Japan; 
(b) The relevant sanitary and phytosanitary regul ations and the relevant Domestic Law or Act 
involved; 
(c) The relevant agencies involved in the a pplication process and the responsibilities of these 
agencies; and 
(d) The relevant documents to be submitted in the application process. 
 WT/TPR/M/211/Add.1 
Page 202  
 
  A. The import of heat-treated meat products is regulated by the Food Sanitation Law as well as 
the Domestic Animal Infectious Disease Control Law.   (1) Food Sanitation Law  
The Food Sanitation Law defines meat product standards .  Please refer to relevant documents on the 
following website for more informatio n on meat product standards (I-D8)  
http://www.jetro.go.jp/en/reports /regulations/pdf/testing-e.pdf 
 Under Article 27 of the Food Sanitation Law, tho se who wish to import food, food additives, 
apparatuses, or container/packages for sale or for us e in business, must notify  the Minister of Health, 
Labour, and Welfare about each import.  The imported foods and related products must not be used for sale without import notification.   A "Notification Form for the Importation of Foods, etc." should be submitted to a Quarantine Station 
of the Ministry of Health, Labour and Welfare, where food sanitation inspectors carry out 
documentary examination as well as inspection of pr oducts in order to confirm compliance with the 
Food Sanitation Law.   In the case of imported meat products, health certificates issued by exporting countries shall be 
submitted to the Quarantine Stations  with notification Forms.  Also, the products must comply with 
the standards of the Japanese Food Sanitation Law. 
 The relevant information of the import procedure is available in English on the following website. 
http://www.mhlw.go.jp/englis h/topics/importedfoods/1.html 
 
(2) Domestic Animal Infectious Disease Control Law. 
 In regard to the import of heat-treated meat prod ucts, inspection from animal health viewpoint is 
required in accordance with the Domestic Animal Inf ectious Disease Control Law.  In terms of this 
import inspection, the Ministry of Agriculture, Forestry and Fisheries has the overall responsibility 
for animal health and the actual inspection is carri ed out by Animal Quarantine Services.  Please 
refer to the following website of the Animal  Quarantine Service of Japan for details. 
http://www.maff.go.jp/aqs/english/index.html.   CANADA
 
 
Questions and answers on the Report of Japan  Q1. Could Japan elaborate on the key components of the Basic Policies, particularly as they relate 
to investment? 
 
A. The key components of the Basic Policy are th e implementation of a comprehensive strategy 
to enhance growth potential, making every effort to  establish a low carbon society, the reform of 
public finance and administration in the best interest of people, the establishment of a sustainable social security system, and an improvement of the quality  of life in Japan. In regard to the FDI policy, 
the following measures were me ntioned in the Basic Policy. 
 <Excerpt from the "Basic Policies for Economic  and Fiscal Management and Structural Reform 
2008">    WT/TPR/M/211/Add.1 
 Page 203 
 
 
  Expansion of foreign direct investment in Japan  
 Japan will expand Foreign Direct Investment in Japan and make Japan a country that is growing 
along with the global economy.  For this purpose, Japan will revise the "Program for Acceleration of 
Foreign Direct Investment in Japan" by fall 2008 and implement it steadily with periodical reviews.  
 
- Japan will identify and clarify the approval desi rable form of M&A (Mergers & Acquisitions) 
by summer 2008. (The Corporate Value St udy Group published the report on comprehensive 
studies of M&A (Mergers & Acquisitions) in June 2008.) 
- Japan will advance comprehensive studies on d esirable form of Foreign Direct Investment 
regulations as exception to the principle of  nondiscrimination between domestic and foreign 
investors in FY2008. (The Cabinet Office held  a director-general level meeting for the 
establishment of a comprehensive study on FDI regulations and began the study in 
December 2008.) 
- Japan will formulate an "Action Plan" to speed up the review for approval of medical devices 
by fall 2008. (The Ministry of Health, Labor  and Welfare formulated an Action Program in 
December 2008 intended to dissolve "Device Lag".) 
- Japan will take measures to reduce business cost s by studying the desirable from of the 
effective corporate tax rate as part of fundamental tax reform. (It is stipulated in the FY2009 tax reform bill, which is still being deliberated up on by the Diet as of February 2009, that in 
future fundamental reforms of the taxation system, the Government will consider broadening 
the corporate tax base as well as reduci ng the effective corporate tax rate.)  
 
<http://www.keizai-shimon.go.jp/english/publicat ion/pdf/080627_basic_policies_summary.pdf> 
 
Q2. Does this policy reform include a policy on Bilateral Investment Treaties? 
 
A. The Basic Policy 2008 includes a poli cy on Bilateral Investment Treaties. 
 
Q3. If so, could you please elaborate on what this policy entails?  A. The policy states that Japan will promptly a nd flexibly negotiate on Bilateral Investment 
Treaties based on actual demand, and consider whic h possible partner countries and regions deserve 
strategic priority.  Q4. Does your stimulus package in response to th e recent financial crisis include any measures 
affecting foreign investment? 
 
A. In our economic packages, we took some  measures encouraging private investment. 
"Immediate Policy Package to Safeguard People's Daily Lives" http://www5.cao.go.jp/keizai1/2008/081224summary-english.pdf  "Measures to Support People's Daily Lives" 
http://www5.cao.go.jp/keizai1/2008/081201outline-english.pdf 
 "Comprehensive Immediate Policy Package" http://www5.cao.go.jp/keizai1/2 008/0918summary-english.pdf 
 Q5. Has the government made any progress, beyond  the welcome implementation of triangular 
mergers and acquisitions policies, on reassessing restri ctions on overseas investments in Japan so as to 
raise FDI to 5% by the end of 2010?    WT/TPR/M/211/Add.1 
Page 204  
 
  A. Japan aims to make the Japanese market more attractive through the steady improvement of 
the investment environment, including the field  of M&A and international capital flow.  To 
accomplish this, Japan revised the "Program for th e Acceleration of Foreign Direct Investment in 
Japan" in December 2008. 
 Q6. How is the Japanese government working w ith private business entities such as Keidanren 
Business Federation corporate members to promote FDI into Japan by discouraging common business 
practices such as the adoption of poison pill measur es made easier by the relatively weak position of 
shareholders within the current corporate governan ce environment which is influenced significantly 
by Japanese laws and regulations? 
A. The Government of Japan makes foreign direct  investment promotion policy referring to the 
comments of private business entities - through co mmittees and councils such  as the Council on 
Economic and Fiscal Policy and so on. 
 
Q7. How does Japan stand regarding the achievement  of Bogor objectives in time for the Japanese 
APEC chairmanship in 2010? 
 
A. In preparation for assuming APEC Chairmans hip in 2010, Japan is currently considering 
how to assess the achievement of the Bogor Goals. 
 
Q8. Could Japan please provide clarification on the meaning of "Organization of measures for the 
promotion of the contents industry"? 
 
A. "Organization of measures for the promoti on of the contents industry" means "organized 
measures to promote the contents industry."  
Japan has taken measures for the promotion of the contents industry which include the following:  
 - Enactment of the "Law Concerning Promotion of Creation, Protection,  and Exploitation of 
Content (the Contents Promotion Law)" whic h indicates the fundamental principles on the 
promotion of creation, protection and ex ploitation of content (June 2004) 
- Enactment of the "Act on the Prevention of Un authorized Recording of  Movies in Theatres" 
(August 2007) 
- The JAPAN International Contents Festival held every year since 2007  
- Establishment of broadcasting contents mark et through "International Drama Festival in 
TOKYO" which have been held since 2007 
 Q9. It is very interesting that Japan has est ablished intellectual property head quarters in 
universities.  Could more details  be provided on the activities that take place at these institutions? 
 
A. With the enactment of the National University  Corporation Law in 2004, in principle, the 
ownership of research results and findings shifted from individual researchers to institutions. 
 
Additionally, Japan has provided assistance to model universities (includi ng personnel and business 
or activity expenses from FY2003 to FY2007), to th e tune of ¥13 billion, with the purpose of 
comprehensively consolidating intellectual pr operty creation, management, and utilization into a 
single integrated system.  
 
In recent years, universities have ac tively and strategically conducted a diverse range of activities, in 
order to effectively utilize their distinct char acteristics for cooperati ve activities among industry, 
academia, and the government.   WT/TPR/M/211/Add.1 
 Page 205 
 
 
  Major achievements made through the intellect ual property headquarters at universities are as 
follows:  - nurturing and maintaining intellectual property specialists at an international standard. - reinforcing the function of international law and preventing conflict 
- strengthening the function of disseminatin g information for international activities of 
industry, academic and public cooperation. 
 For details on each university's activities, please vi sit their intellectual property pages at the websites 
listed below. 
 
Hokkaido University http://www.mcip.hokudai.ac.jp/eng/  Tohoku University 
http://www.tohoku.ac.jp/eng lish/sangaku/sangaku1-1.htm 
 The University of Tokyo http://www.ducr.u-tokyo.ac.jp/en/index.html  Tokyo Medical and Dental University 
http://www.tmd.ac.jp/tlo/e_index.html 
 Tokyo University of Agriculture and Technology http://www.tuat.ac.jp/~crc/  
Tokyo Institute of Technology 
http://www.sangaku.titech.ac.jp/english/index.html  Keio University http://www.ipc.keio.ac.jp/english/index.html  
Tokyo University of Science 
http://www.tus.ac.jp/tlo/english/index.html  Waseda University http://tlo.wul.waseda.ac.jp/ENG/index.html 
 
University of Yamanashi http://www.ucip.jp/?xoops_theme_select=E501  Niigata University http://www.niigata-u.ac.jp/gakugai/jo/index.html (Japanese only) 
 
Nagoya University http://suishin.jimu.nagoya-u.ac.jp/eng_top.html  Kyoto University 
http://www.saci.kyoto-u.ac. jp/index.php?cat=4&lang=en 
 Osaka University http://www.uic.osaka-u.ac.jp/index.html (Japanese only)  WT/TPR/M/211/Add.1 
Page 206  
 
  Nara Institute of Science and Technology 
http://ipw.naist.jp/sankan_en/index.html  Hiroshima University http://www.hiroshima-u.ac.jp/en/sangaku/ 
 
Kyushu University http://www.astec.kyushu-u.ac.jp/eng/index.html 
Q10. Has the bill been adopted during the 2008 fa ll session?  If not, what are the issues regarding 
the fact that the bill has still not been adopted? 
 
A. The amendment bill was not deliberated at the last Diet session and has not been enacted. 
 
Questions and answers on the Report of Secretariat  
Q1. Could Japan indicate if its government is on track to achieve its objectives for the year 2008? 
 
A. The achievements of Japans objectives for 2008 are progressing well.  
The numbers of special accounts in FY2 008 were 21 compared to 31 in FY2006. 
 
Q2. What measures have been put in place to me et the recommendations of the advisory panel? 
 
A. Japan has been studying extensively the va rious perspectives on the way public pension 
reserve fund investment should be carried out. *The recommendation referred to in the WTO Secretaria t's report is a part of the second report of the 
"Globalization Reform Research Committee / Fi nancial and Capital Markets Working Group" to the 
"Council on Economic and Fiscal Policy"  
Q3. What are the next steps in negotiation of fu ture bilateral Free Trade Agreements?  What 
criteria will Japan use in assessing which countries it w ill wish to negotiate future agreements with? 
 
A. Japan continues to be actively engaged in negotiations with the Gulf Cooperation Council 
(GCC), India and Australia.  Japan is also consulting the Republic of Korea about the early 
resumption of EPA negotiations and considering the possibility of an EPA with Peru.  
 As for future EPAs, Japan continues to examine, in a comprehensive manner, possible EPA partners, 
giving with due consideration to various viewpoints such as creation of an international environment 
beneficial to Japan, ensuring Japan's economic interest  as a whole, the current situation of possible 
partner countries and regions as well as the feasibility of each EPA. 
 
Q4. The secretariat report notes in several places that the Government issued a recommendation 
against an FDI proposal in electric utilities on the gr ounds of "public order, publ ic safety, and national 
security".  Could Japan please provide more inform ation on what was meant by "public order, public 
safety, and national security" and how it applies to this particular investment? 
 
A. The reasons for restriction such as "public order, public safety, and national security" are in 
complete compliance with interna tional rules including the OECD Code of Liberalization of Capital 
Movements.  
 
Japan reviewed the notification based on the Foreign Exchange and Foreign Trade Act (FEFTA) 
submitted by a foreign investor on 15 January 2008  regarding a planned investment to a wholesale 
electric power company.  After the review, it was deemed that the proposed investment could have  WT/TPR/M/211/Add.1 
 Page 207 
 
 
  adverse effects on the construction and operation of  the companies' nuclear power plants currently 
under construction, thereby causing negative impacts on the stable supply of electric power in Japan 
as well as on Japan's nuclear energy and fuel- cycle policies.  Thus, Japan recommended the foreign 
investor to discontinue the planned investment on 16 April 2008. Since the foreign investor refused to 
accept the recommendation on 15 April 2008, Japan or dered the foreign investor to discontinue the 
planned investment on 13 May 2008.  
Q5. Of the 62 evaluations, how many assessments ha ve resulted in a reduction or elimination of 
allocations and for what amount? 
A. In FY2007, the Ministry of Finance c onducted budget execution surveys on 62 projects. 
7 of the 62 surveys resulted in an abolishment of all or a part of the project.  These 7 surveys and the 
other 45 surveys have resulted in a reduction of government expenditure of ¥30.7 billion in the 
FY2008 budget. In addition, one survey resulted in  an increase to the government revenue of 
¥3.5 billion in the FY2008 budget. 
 Q6. How will Japan ensure that future Free Trad e Agreements are consistent with Article XXIV 
of the GATT?  
A. While GATT Article XXIV paragraph 8 do es not specify a quantitative benchmark of 
"substantially all the trade", the Government of J apan is of the view that many members have been 
involved in RTA negotiations under the general perception that duty e limination needs to cover at 
least 90% of trade between the par ties and that no exclusion of a major sector is allowed in respect of 
RTA's consistency with the said provision.  Under the EPAs which Japan has alre ady concluded, tariffs are eliminated at the time of entry into 
force for most of the goods and tariffs will be e liminated within 10 years for the goods which account 
at least 90% of trade value between parties.  In  addition, there is no exclusion of a major sector.  
Therefore, Japan's EPAs are consistent with Artic le XXIV of the GATT, and Japan will ensure WTO 
consistency by continuing to be engaged in future EPA negotiati ons based on the aforementioned 
position. 
 
Q7. What progress in trade policy does Japan foresee with Canada in the coming years? 
 
A. In November 2008, the Trade and Investment Dial ogue (TID) was held for the first time. The 
establishment of the TID was decided by Deputy Ministers of both countries at the 21
st meeting of the 
Canada-Japan Joint Economic Committee (JEC) in J anuary 2008 with the intention of promoting 
trade and investment betw een Canada and Japan.  
 Through such strengthened dialogue, Japan expects that existing trade and investment relations 
between the two countries will further deepen in  the coming years.  The TID provides a precious 
opportunity for relevant officials in each government  to exchange information on bilateral, regional 
and international trade and investment policies as  well as relevant developments, including WTO 
negotiations, approaches to regional economic in tegration, respective strategies on Economic 
Partnership Agreements/Free Trade Agreements (EPAs /FTAs), Bilateral Investment Treaties (BIT) 
and other topics of mutual interest.  The TID is held annually. 
 Q8. What are Japan's criteria and prior ities for future BIT negotiation partners? 
 
A. Regarding the criteria and priorities for futu re BIT negotiations, taking into account the 
actual needs of its business community, Japan has adopted the following key elements to be 
considered in a comprehensive and strategic manner wh en deciding priority countries/regions for BIT 
negotiations: WT/TPR/M/211/Add.1 
Page 208  
 
  1) the actual track record of investment between Japan and the country and future incremental 
prospects for bilateral investment, 
2) the necessity of improving investment envi ronment of the country, and requests from the 
Japanese business community, 
3) the importance of the country as a supplier of  energy, foods and other primary materials and 
products, 
4) the governance capacity and political stability of the country, and 5) the political and diplomatic significance for Japan 
 
Q9. What measures have been implemented or w ill be implemented as part of Budget 2009 or 
other pending legislative or regulat ory action to increase FDI in Japan? 
 
A. The budget for FY2007 is currently being deliberated upon by the Diet. 
The budget for the Japan External Trade Organization (JETRO) to invite foreign firms into Japan and 
hold "Invest-Japan Symposium" in Japan and overseas is included in the bill, in addition to the 
budgets of various ministries. 
 Regarding legislative or regulatory actions to increase FDI in Japan, Japan is determined to continue 
to implement individual measures through a p eriodical follow-up of the "Program for the 
Acceleration of Foreign Direct Investment in Japan" which was revised in December 2008.  
 Q10. Has the Common Portal been established? 
 
A. The single window (common portal) was established in October 2008. 
 
Q11. Has improvement of efficiency been observed? 
 
A. There has been a unification of the applicant  ID system and the system for electronic 
application and data input that previously had d ifferent specifications among different agencies. 
Additionally, a system for Data-sharing among th e agencies has been started, which enables 
applicants to save work by reusing the basic information submitted to the Common Portal. 
Accordingly, this user-friendly interface provides highly convenient services that meet applicants' 
needs.  
Q12. The Secretariat Report states that "Since Jap an's previous Review, there has been no change 
in the quota allocation method, which tends to be in tricate."  Is Japan's intention to simplify the quota 
allocation method in the next few years? 
 
A. Japan is convinced that its administration of tariff quotas is  appropriate, and is conducted in 
a fair and transparent manner, based on the characteristics of each product. 
 Therefore, Japan has no concrete plan to change the existing quota allocation method. 
 Q13. The Secretariat report states that "nearly 150 tariff lines, including certain meat, leather, and 
leather products, are subject to new tariff-rate quot as created especially under the EPA between Japan 
and Mexico (JUMSEPA) (lines of agricultural prod ucts are not subject to tariff-rate quotas under 
applied MFN rates);  the in-quota rates are lo wer than the corresponding applied MFN rates." 
 
Could Japan provide further details on which tariff lines will be subject to the new tariff-rate quotas 
under JUMPSEPA;  the size of each quota as well as the in and out-of quota rates pertaining to each 
new tariff-rate quota?   WT/TPR/M/211/Add.1 
 Page 209 
 
 
  A. Please refer to Table AII.1 of Annex II of  "Factual Presentation –Economic Partnership 
Agreement between Japan and Mexico (Goods  and Services)" by the WTO Secretariat 
(WT/REG198/4, 15 September 2008). 
 
Q14. Could Japan please provide information con cerning its green procurement policies, including 
with respect to pulp and paper?  A. A Revision of the Basic Policy under the Law on Promoting Green Purchasing was approved at the Cabinet Meeting of February 13, 2009, and will be effective from April 2009. 
 In the new criteria for copier paper (ppc), use of  eco-friendly material besides recycled fiber is 
additionally admitted (including material from independently-verified proved sustainably managed 
forests). 
 In this new criteria, the manufacturer evaluates its  paper products by a point rating system provided 
by the government with additional points for br ightness and basis weight.  Items with overall 
evaluation points meeting certain standards w ill be selected for green purchasing.  
 
Q15. Could Japan please provide additional info rmation concerning the bidding methods adopted 
in November 2007?  
A. In November 2007, Japan decided that each mini stry must carry out strict reviews of single 
tendering, checking procurement cont racts for the following points: 
 
1) When the contracts are switched to th e competitive bidding methods, the competitive 
procedures must be appropriate accordi ng to the content of the contracts. 
2) After contracts are switched to competiti ve bidding methods, the possibility of expressing 
competitiveness should not be blocked, e.g. by putting limited qualifications on the contracts. 
3) The contracts which are supposed to use onl y single tendering procedures should be enforced 
appropriately according to the law and other government regulations. 
4) Especially, contracts with public service co rporations which ministries oversee should be 
enforced with adequate attention given to compliance with the law and other government 
regulations. 
 Q16. Could Japan please clarify the concept of voluntary measures? 
 
A. Voluntary measures are designed to ensure non-discriminatory, transparent, fair and open 
competition within the government procurement pro cess.  For example, Procurement contracts of 
products and services by central government entities and all other entities are placed above 
130,000 SDR in the GPA.  For voluntary measures, procurement contracts above 100,000 SDR and 
below 130,000 SDR are also handled in line with the GPA.  Furthermore, the period of the receipt of 
tenders in the GPA is over 40 days, while fo r voluntary measures it is over 50 days. 
 
Q17. Can Japan explain the declining share of  foreign suppliers in the office machines and 
automatic data processing equipment category (from 5.6% in 2005 to 1.9% in 2006)? 
 
A. The share of foreign suppliers in the office machines and automatic data processing 
equipment fields, in terms of value, decreased by  3.7% from 2005 to 2006.  The government of Japan 
has no further detailed analysis about this statistical trend. 
 Q18. Of the 835 JIS items revised, the 289 withdr awn, and the 626 newly established, how many of 
them were or are comparable to international sta ndards, and how many of th em were or are aligned 
with international standards? WT/TPR/M/211/Add.1 
Page 210  
 
  A. Out of 626 newly established JIS items, th ere are 438 items comparable to international 
standards and all of them are aligned with international standards.   There are also 428 revisions aligned with intern ational standards out of 443 items which are 
comparable to international standards. 
 
As for the withdrawal of JIS items, there were 99 ite ms aligned with international standards out of 
101 items which were comparable to international standards.  
 
Q19, 20. Could Japan explain how the authorities (e.g. WTO Enquiry Point/Notification Authority) 
monitor the creation or modification of TBT techni cal regulations / conformity assessment procedures 
in its country in order to determine whether a WTO notification is required under the transparency 
obligations of the TBT Agreement?     When a determination is made, what is the mech anism (e.g. interdepartmental/ inter-ministerial 
collaboration) and timeline for the preparation of notifications? 
 
A. Each responsible authority has its own speciali zed division which monitors all of its technical 
regulations and conformity assessment procedures and gives advice to other relevant divisions at the 
onset of the formulation of regulati ons/ conformity assessment procedures. 
 
If the necessity of WTO notifications is not clear enough, responsible authorities ask the WTO-TBT 
enquiry point whether they need to notify, and the enquiry point gives the final decision.   When necessary, the division in charge of a regulatio n, with the help of the monitor division, prepares 
a draft for notification.  After peer review by the WTO-TBT enquiry point, the draft is sent to the WTO 
office.  No specific statistics for the timeline are kept; however, draft preparation is undertaken well 
in advance its entry into force. 
 
Q21. Could Japan please provide the contact in formation of the office responsible for this 
registration process?  A. The office in charge of the reg istration of overseas laboratories is: 
Office of Quarantine Station Administration, Policy Planning and Communication Division, Department of Food Safety, Pharmaceutical and F ood Safety Bureau, Ministry of Health, Labour and 
Welfare. 
 Q22. Over the last year, what progress has Japan made in this regard? 
 
A. In accordance with the "Reorganization and Rationalization Plan for Incorporated 
Administrative Agencies", "Japan Green Resources Agency" was dissolved in March 2008, and the 
"Nippon Automated Cargo Clearance System Operations Organization" was privatized in October 2008.  In addition, in December 2008, it was decided that the "Employment and Human 
Resources Development Organization" woul d be dissolved in December 2008. 
 
Q23. Canada notes that the maximum term of prot ection for designs under the Design Act has been 
increased from 15 to 20 years, and would be interest ed in knowing what prompted the Japanese Patent 
Office to apply that change. 
 
A. Attractive designs may be a source of added value for a long term.  In fact, as of the end of 
2004, almost 16% of registered design right still exist on the 15
th year from the date of registration. 
Therefore, it was concluded that the duration of pr otection of design right should be extended to more 
than 15 years from the date of registration.  WT/TPR/M/211/Add.1 
 Page 211 
 
 
  On the other hand, in the case that the duration of protection would be extended to more than 
20 years, the extended duration stipulated by the amended Act would be quite different from the 
duration stipulated by the previous Act, thus c ausing an imbalance between  applicants who can enjoy 
only the previous duration and those who can enjo y the extended duration.  For these reasons, we 
considered it appropriate to extend the duration from  "15 years from the date of registration" to 
"20 years from the date of registration".  
Q24. The Secretariat Report states that the protection of certain computer-related graphic images has also been increased.  Could Japan please specify the measures that have been taken to increase the 
protection of these images? 
 
A. By the amendment of Design Act in 2006, a graphic image used on a screen for the operation 
of an article (limited to the operations carried out  in order to enable the article to perform its 
functions) is now protected.  Graphic images " on a multi use screen used in an integrated manner 
with the article” are also protected in addition to  graphic images “on a screen on the article itself".  
 
The examination of these graphic images is conducted from the viewpoint of novelty and creativity 
and is based on the Design Examination Standard, as are the examinations of other articles.  
 
Q25. The Secretariat Report states that "The Governme nt aims to attain an average wait for the first 
action for patents to be within 30 months by 2008, and within 11 months by 2013." 
 
What progresses has Japan made in this regard in 2008 and what measures will be taken to reach its 
goal in 2013?  
A. The first action pendency in 2008 was 28-29 months and the target for 2008 was achieved.  
To achieve the goal for 2013, Japan will further increase the number of examinations by taking the 
following measures.  1. Increasing the Outsourcing of Prior Art Searches  To improve the efficiency of patent examination,  the JPO has introduced and has been expanding the 
outsourcing of prior art searches.  The JPO outs ources part of the prior art searches necessary for 
first actions to search organizations ("registered search organizations").  Currently, there are eight 
registered search organizations and the numb er of outsourced searches in FY 2007 was about 
213,000 (67% of the first actions).  
There are two types of search outsou rcing.  One is the "report by paper" type, in which search results 
are reported to examiners only by the search reports.  The other is the "report by dialog" type, in 
which search results are reported to examiners by both oral explanations and search reports, and the 
examiners can instruct the searchers to conduct addi tional searches if necessary.  "report by dialog" 
type is more efficient than "report by paper" type, therefore most of the outsourced searches are 
"report by dialog" type.  In FY 2007, the number of "report by di alog" type outsourced searches was 
about 169,000 (79% of the total outsourced searches). 
 To achieve the goal for 2013, the JPO will continue  to improve and expand the outsourcing of prior 
art searches (especially "report by dialog" type).  
2. Increasing the number of examiners 
 In order to increase the examination capacity, the JPO has been increasing the number of examiners. 
Especially from FY 2004 to FY 2008, the JPO hired 480 fixed-term examiners, in addition to increasing the number of regular examiners. WT/TPR/M/211/Add.1 
Page 212  
 
  The JPO will continue to make efforts to  secure the necessary num ber of examiners. 
 3. Promoting International Cooperation in Patent Examination  When one patent application is filed in several countries respectively, prior art searches and 
examinations for the same application would be dup licated.  Among the Trilateral Offices (the JPO, 
the USPTO and the EPO), the number of such overlapping applications reaches about 240,000/year 
and how the offices can efficiently examine these applica tions has become a common issue.  From this 
perspective, the JPO, together with other patent offices, promotes cooperation in patent examinations 
through measures such as the Patent Prosecution Hi ghway, PCT, so that the patent offices can use 
the prior art search results and exa mination results of other patent offices in order to reduce the 
examination workload.  
 
Q26. The Secretariat Report states that "On 25 March 2008, the Government decided that the MLIT would begin a review of the AMA exemption on agreements by air carriers in the international 
aviation sector during 2008;  the MLIT set up an e xpert study group to revi ew this exemption on 
28 August 2008."  When will the e xpert study become available? 
 
A. The expert study group aims to reach a conclusion by around FY 2009. 
 
Q27. What are the total transfers (total support estim ate) to fishery, its share of GDP and its share 
of employment? 
 
A. The total transfer of Japan to fishery in 2006 (including enforcement, research and 
infrastructure), as reported to OECD, is ¥227,224 million.  It accounts for 0.04% of the Japanese 
GDP.  The number of people employed in the Jap anese fishery industry including those involved in 
marine fishery activities in 2006 was 212,000.  It is difficult to calculate the share of employment.   
 
Q28. What measures have been taken or are bei ng considered to raise the self-sufficiency ratio 
from 39% to 45%?  How will the Government of Japan ensure that these measures do not raise 
barriers to trade? 
 
A. To attain the target of food self-sufficiency, 
 
(1) on the consumption side, Japan carries out a nationwide campaign on plain and practical 
“food education”. The campaign include the  prom otion of a "Balanced diet guide" to reduce 
left-over food and, 
(2) on the production side, Japan encourages production to meet consumers' needs by 
strengthening ties between the food industry and farmers and by supporting core farmers who possess 
a better sense of business management. 
 Japan has no intention to address the issue by raising barriers to trade. 
 
Q29. Please provide a complete list of tariff lines for which AVEs were not able to be calculated for inclusion in the averages presented in this paragraph.  
A. Major tariff lines for which AVEs were not po ssible to calculate due to no imports or 
de minimus imports are referred in Chapter 4, paragraph 10 of the Secretariat Report. 
 
Q30.  In light of the recommendations in the gove rnmental report can Japan provide details on the 
reform process for the pork "gate price" syst em and outline how these reforms will create a 
streamlined, transparent, and pred ictable tariff regime pork imports? 
  WT/TPR/M/211/Add.1 
 Page 213 
 
 
  A. In accordance with the "Report of the Expert Committee on Reforms Addressing 
Globalization" and the "Economic and Fiscal Reform 2007" (the Cabinet decision on 
June 19th, 2007), the current gate price system w ill be "examined in the framework of the WTO 
negotiations".  This was decided after the discl osure multiple cases of abuse of the said system. 
 
It would be highly appreciated if exporting countri es would inform their pork exporters of Japanese 
laws and regulation in a timely manner.  
Q31. The Secretariat has noted that the method of tariff quota administration used by Japan can be 
quite complex with restrictions on the use of pr oducts and administrative requirements on companies 
seeking the right to import within quota.  On the other hand, a number of Japan's tariff quotas are 
persistently under filled, with  fill rates of less than 50%. 
 Has Japan considered simplifying how it administers these tariff quotas?  A. The administration of TRQ is formulated appropriately based on the characteristics of each product. TRQs are reviewed annually.  Japan is not  planning to change the current scheme at the 
present time. 
 
Q32. The Secretariat Report states that besides th e import duty, Japan collects a levy or surcharge 
on imports of some commodities, and the collected  levy goes to the special accounts related to 
agriculture in the Central Government. 
 Could Japan provide information on how these levy funds in special accounts are expended in 
agriculture?  A. The levy on out-of-quota imports of rice goes to a special account and is spent on work 
towards the achievement of vari ous objectives, including the purchase of domestic and imported rice 
by the government.  
 
Q33. Is it possible to obtain more recent da ta on subsidies for wheat, barley and rice?  
 A. The amount and type of domestic support fo r rice, wheat and barley in 2006 are as follows: 
Rice:  70.1 billion yen as a Blue Box programme and 2.3 billion yen as the de minimis  Wheat:  92.6 billion yen as AMS Barley:  11.1 billion yen as AMS  
For further details, please refer to the relevant notifications (G/AG/N/JPN/137). 
 
Q34. Under the "emergency measure on rice", the Japanese government purchased 
0.34 million tonnes of domestically produced rice in 2007.  Could Japan please indicate the total amount of support provided through this measure?  
 
A. The final figure of the expenditure made for the purchase of 0.34 million tonnes of rice is not 
available yet. 
 
Q35. In addition, could Japan also indicate how th is support will be classified when it is notified to 
the World Trade Organization Committee on Agriculture?  
 
A. Please refer to Japan's future notificati ons on domestic support wh ich Japan is going to 
submit. 
 WT/TPR/M/211/Add.1 
Page 214  
 
  Q36. Could Japan please indicate the total s upport provided under the "production adjustment 
programme in paddy fields" measure?  
 
A. The amount of support provided under the "production adjustment programme in paddy 
fields" is as mentioned in paragraph 13, page 74 of the Secretariat report. 
Q37. Could Japan also indicate how this support w ill be classified when it is notified to the World 
Trade Organization Committee on Agriculture?  
 
A. The support has been notified to the World Trade Organization Committee on Agriculture as 
a "green box" measure since it is classified as "payments under environmental programmes" in 
accordance with the Ag reement on Agriculture. 
 
Q38. Is there a contradiction between the fact th at Japan wants to increase its food self-sufficiency 
(39% to 45%) and at the same time its exports of food products? How will Japan achieve those two 
objectives?  
 A. Japan defines the "food self-sufficiency ratio" as  all domestic food production, including food 
exported, divided by domestic food consumption.  Japan's food pro duct exports contribute to Japan's 
food self-sufficiency ratio through the in crease of Japan’s domestic food production. 
 
Q.39 Can Japan provide details on any potential re form to the beef and pork emergency tariff 
measures that may take place?  
A. Temporary tariff laws are reviewed and ext ended annually.  In regar d to Emergency tariff 
measures for beef and pork, the Council on Customs, Tariff, Foreign Exchange and other 
Transactions submitted a report last December to the Finance Minister, recommending the 
application of same measures for FY2009 as applied in  FY2008.  Following the report, related bills 
were been submitted to the Diet. 
 Q40. Could Japan provide a description, includi ng the amount of support by product in 2007 and 
2008, of the new direct payment scheme ?  
A. Please refer to the Report by the Secretariat (p71, paragraph 6) for the new direct payment 
scheme.  Japan is planning to notify the amount of support for 2007 and 2008 to the Secretariat in 
due course.  
Q41. The Secretariat Report states that "[o]ther reform measures adopted recently include: allowing 
banks to sell all insurance products ove r the counter (22 December 2007)." 
 What has been Japan's experience in allowing banks to sell insurance products, i.e. how has it affected 
consumer choice, pricing, and has it had any structural effects on the insurance sector? 
 
A. Banning selling of all insurance products over the counter by all banks has been gradually 
removed since April 1, 2001, considering the negat ive effect it had had.  The ban was completely 
removed on December 22, 2007.  While the total sal es of insurance products has been decreasing, the 
sales of certain insurance products, such as variable annuity, have been increasing through the 
banking channels, which has contributed to improv ing national convenience.  Also, Japan holds the 
view is considered that these measures have pr ovided the opportunity for foreign insurance 
companies, which have turned over variable annuity abroad, to enter the insurance market in Japan. 
 
Q42. The Secretariat Report states that the "Government intends to review the firewall regulation 
between banking and securities (Chapter III(4)(v))."  WT/TPR/M/211/Add.1 
 Page 215 
 
 
  Can Japan expand on the status and process of the review of the firewall re gulation between banking 
and securities?  What factors led to the review and are there any preliminary findings that you could share?  
A. The aim of firewall regulations among secur ities, banking, and insurance businesses is to 
prevent negative effects from conflicts of int erest and to prevent the abuse of dominant bargaining 
positions.  However, as financial groups have been  developing, various problems have been pointed 
out, such as barriers to universal services supply,  comprehensive risk management and customer 
convenience.   
Various discussions were hold at the Financial Syst em Council. As a result, "the Bill for Amendment 
of the Financial Instruments and Exchange Act, et c." including the revamp of firewall regulations 
among securities, banking and insurance compani es, was promulgated on 13 June 2008.  
Furthermore, relevant edicts and Cabinet Offic e Ordinaces were promulgated on 23 January 2009.  
These will come into effect on 1 June 2009. 
 
Q43. Can Japan expand on the status and process of privatizing Japan Post?  For example, who will 
regulate the new entity and will there be any aspects th at remain unregulated (i.e. grandfathered under 
the old regime)?  
A. On 1 October 2007, Japan Post was priva tized and Japan Post Bank was established as a 
corporation which inherited the function of J apan Post's postal savings and the Incorporated 
Administrative Agency Management Organization for Postal Savings and Postal Life Insurance was established as a corporation wh ich engaged in management of  the previous postal savings. 
 Japan Post Holdings currently owns all the stocks of  Japan Post Bank.  According to the Law of the 
Privatisation of the Postal Services, Japan Post Hold ings shall dispose of all the stocks step by step 
during the 10-year privatisation transition period.  Because Japan Post Bank was established as a bank under the Banking Law, Japan Post Bank is 
subject to the same laws, including the Banking Law, as are applied to other private banks and is subject to inspection and supervision by the Financia l Services Agency.  In addition, the Law of the 
Privatisation of the Postal Services imposes busin ess restrictions on Japan Post Bank during the 
privatisation transition period.  Expansion of Japan Post Bank's business scope during the above transition period must go through 
transparent and fair procedures.  The Prime Minist er (whose power is delegated to the Commissioner 
of the Financial Services Agency.  The same sha ll apply hereinafter) and the Minister for Internal 
Affairs and Communications, upon hearing an opini on of the Postal Services Privatization 
Committee, shall decide on such expansions.  The Pr ime Minister and the Minister of internal Affairs 
and Communications shall approve these business ex pansions when they find there is no risk of 
impairing fair competitive relationships and approp riate provision of service to users, taking into 
consideration the circumstances a ffecting competitive relationships and the business conditions of 
Japan Post Bank respectively. 
 On 19 December 2007, the Prime Minister and the Mini ster for Internal Affairs and Communications 
approved the diversification by Japan Post Bank in terms of asset management, including syndicated 
loans ("participation-type").  On 18 April 2008, th e two ministers also approved the expansion of 
Japan Post Bank's business, including credit card bu siness, sales of life insurance products such as 
individual variable annuity, and brokerage  such as allied bank’s housing loans. 
 WT/TPR/M/211/Add.1 
Page 216  
 
  Incorporated Administrative Agency Management Organization for Postal Savings and Postal Life 
Insurance which engages in management of the previ ous postal savings which it  inherited from Japan 
Post is subject to inspection and supervision by th e Ministry of Internal Affairs and Communications. 
 
Q44. The Secretariat Report states that "…the ASBJ will diminish major differences that the 
Committee of European Securities Regulators identi fied with the International Financial Reporting 
Standards;  other current di fferences will be addressed by the ASBJ by June 2011…". 
 What progress was achieved by Japan in 2008 rega rding the reduction of major differences with the 
International Financial Reporting Standards?  Could Japan outline its plan to eliminate other 
differences by 2011? 
 
A. In 2008, the ASBJ finalized its project aime d at eliminating the significant differences, as 
suggested by the Committee of European Securiti es Regulators (CESR), in accordance with the 
project time-table set in December 2007.  The ac hievement brought Japanese accounting standards in 
line with the IFRSs, and they were assessed as equi valent to the IFRSs by the European Commission 
in December 2008.    In addition, the ASBJ and the IASB agreed in th e Tokyo Agreement of 2007 that by June 2011 they 
will work towards bringing about convergence on the remaining differences between Japanese GAAP 
and IFRSs that have been identified by the boards, but that were not part of the 2008 projects. 
 
Q45. It is noted that Japan has been promoting the Asian Gateway Initiative that aims to position 
Japan as an efficient conduit for people and goods between Asia and the rest of the world.  Would 
Japan consider that further air liberalization woul d help achieve the objectives of its Asian Gateway 
Initiative? 
 
A. The formation of a strategic international  aviation network through aviation liberalization 
with other Asian countries is recognized as one of 10 priority factors in realizing the Asian Gateway 
Initiative, since aviation is a strategic infrastruc ture for promoting the exchange of people, goods and 
money.  Enhancing the aviation network is a prerequisite for Japan to become an Asian and 
international gateway. 
 
Q46. The Secretariat Report states that "in addition to obtaining relevant licenses, membership of a 
professional association is compulsory for:  certif ied public accountants, administrative scriveners, 
lawyers, judicial scriveners, land and house survey ors, licensed tax accountants, public consultants on 
social and labour insurance, and patent attorneys."  
 
Could Japan clarify the requirements for membership  in those associations, and identify if there are 
different requirements for Japan ese nationals and foreigners?  
 
A. There is no specific qualification regarding nationality for the membership of relevant 
professional association,  which are required for a certified public accountan t/certified administrative 
procedures specialist/ registered foreign lawyer/ judicial scriveners/land and house 
surveyors/certified public tax accoun tant/public consultant on soci al and labor insurance/patent 
attorney.  The conditions of residence are as follows: 
 
Certified Public Accountants There is no specific qualification regarding residence required to join the Japanese Institute of 
Certified Public Accountants.   WT/TPR/M/211/Add.1 
 Page 217 
 
 
  Administrative Scriveners  
There is no specific qualification regarding residence required to join the national association for administrative scriveners.  Lawyers  
Residence is required to be recognized as a registe red foreign lawyer by the Minister of Justice. In 
addition, a registered foreign lawyer is required to stay in Japan not less than 180 days in a year. 
Judicial Scriveners  There is no specific qualification regarding reside nce required to join the association but a 
professional must establish an office in Japan. 
 Land and House Surveyors There is no specific qualification regarding residence to  join the associaton, but a professional must 
establish an office in Japan. 
 
Certified Public Tax Accountant There is no specific qualification regarding reside nce required to join the association but a 
professional must establish an office in Japan.  Public Consultants on Social and Labor Insurance 
For membership of association, a foreign profess ional has to submit to the association his/her 
"Certificate of Registered Matters" provided for in th e Alien Registration Law, which will be issued at 
the request of a foreign national who has registered at  the municipal office of the city, town or village 
in which his/her residence is located.  
 Patent Attorney There is no qualification regarding residence required to  join the Japan Patent Attorneys Association. 
 
No person, who meets any of the following conditions, can join the association.  Foreign Lawyer - if the person has a mental or physical disorder. - if the person who was subject to the disciplinary action stipulated in item (iii) of Article 7 of 
the Attorney Act submits a request after three yea rs from the date of the disciplinary action. 
 Certified Public Tax Lawyer - if the person falls under any of the categories stipulated in Article 24 of the CPTA Law  
Patent Attorney 
- When there is a risk that it will be inappropria te to permit the person to perform professional 
duties as a patent attorney due to  mental or physical disorder 
- When there is a risk that the person will damage the reputation of patent attorneys 
 Q47. The Secretariat Report indicates that amendments to the Certified Public Accountant 
Act (CPA) in 2007 permit foreign accountants not qu alified as a CPA in Japan to provide auditing 
services specified in Article 2-2 of the CPA Act under certain conditions.  Could Japan clarify the conditions under which fo reign accountants not qualified as a CPA in Japan 
are permitted to provide the specified auditing services? 
 
A. The amendments to the CPA Act in 2007 permit those who do not hold Japanese CPA 
qualification to be partners of audit firms.  This en ables them to work for audit firms as partners, but WT/TPR/M/211/Add.1 
Page 218  
 
  does not permit them to conduct audits on behalf of the firms;  audit reports are invalid unless they 
are signed by qualified auditors who hold Japanese CPA qualification.  However, Article 2-2 of the 
CPA Act allows those who do not have Japanese CP A qualification including foreign accountants, to 
provide accounting services such as compiling financial documen ts and consulting services relating 
to finance. 
 
 AUSTRALIA
 
 
Q1,2. Could Japan outline how its plans for fiscal consolidation have changed from the original 
target of achieving a primary balance surplus by FY2011?  
A. The target is a milestone toward "fiscal cons olidation."  It remains necessary to achieve this 
target as soon as possible while flexibly responding to unprecedented and uncertain economic 
conditions inside and outside Japan .  While it is difficult to accura tely predict the future economic 
situation amid such fluid and unclear conditions, J apan will make efforts to restore its fiscal health, 
placing top priority on economic recovery.  
Q3. Can Japan please explain how these free-trade agreements meet Article XXIV.8(b) of GATT 
requiring the coverage of 'substantially all trade'? 
 A. While GATT Article XXIV paragraph 8 do es not specify a quantitative benchmark for 
"substantially all trade," the Government of Japan is of the view that many members have been 
involved in RTA negotiations under the assumption that duty elimination needs to cover at least 90% 
of trade between the parties and that no exclusion of a major sector is allowed for the RTA to be 
consistent with the said provision. 
 
Under the EPAs which Japan has alre ady concluded, tariffs are eliminated at the time of entry into 
force for most of the goods, and tariffs for the goods which account for at least 90% of trade value 
between parties are set to be eliminated within 10 years.  In addition, there is no exclusion of any 
major sector.  In this way, Japan's EPAs are consistent with Article XXIV of the GATT. 
 Q4. We note in the Secretariat's report that Japan views bilateral trade agreements as useful tools 
for market liberalization and structural reform.  In its bilateral trade agreements to date (including 
those under negotiation), how has Japan applied this sentiment to its agricultural sector? 
 
A. Japan actively engages in EPA negotiations, while following a policy of "protect what should 
be protected."  Japan recognizes the impact of EPAs on domestic agriculture, and gives due 
consideration to food security and the ongoing pr ogress of the structural reform of domestic 
agriculture when negotiating an EPA. 
 
Q5. Can Japan please elaborate if it will expand LDC duty-free/quota-free treatment to all agricultural products, given the importance of these products to economic grow th and development of 
these countries? 
 
A. Since 1 April 2007, Japan has expanded duty-free and quota-free (DFQF) market access to 
the Least-Developed countries (LDCs), covering appr oximately 98% of all tariff lines, thereby 
realizing upon its commitment to provide DFQF market access for at least 97% of products 
originating from LDCs, as is stated in the WTO Hong Kong Ministerial Declaration.  (See 
WT/COMTD/N/2/Add.14 for details)  Japan will con tinue to apply its tariffs in an appropriate 
manner. 
  WT/TPR/M/211/Add.1 
 Page 219 
 
 
  Q6. Australia welcomes Japan's efforts to exte nd its duty-free and quota-free (DFQF) preferential 
treatment for LDCs.  Australia notes that Japan's DFQF preferential treatment covers tariff lines 
including dairy, wheat and barley products.  For these lines, does DFQF preferential treatment enta il that Japan refrain from applying any other 
border charges (such as mark-ups and surcha rges) to these imports, where applicable? 
 
A. No border charge is collected, for the goods originating from LDCs, which are covered by 
DFQF preferential treatment. 
 Q7-1. What changes has Japan made to its investment  regulations to make investment in Japan more 
attractive for overseas investors?   
A. Japan strives to make the Japanese market more attractive through the strategic 
dissemination of information by local governme nts and by regional collaboration between local 
governments, the improvement of the investment environment through measures such as those to 
facilitate M&As and international capital flow, an d active publicity in domestic and foreign areas to 
welcome foreign companies.  To accomplish th ese measures, Japan revised the "Program for the 
Acceleration of Foreign Direct Investment in Japan" by reflecting those actions into the program in 
December 2008. 
 Q7-2. Australia understands that Japan's Fair Trad e Commission (FTC) plans to transfer its appeals 
process to the court system.  Would Japan consider adopting a similar proposal for appeals on foreign 
investment decisions?  
A. Under the Foreign Exchange and Foreign Trade Act, there is no appeals system like the one 
under the Act on Prohibition of Private Monopolization and Maintenance of Fair Trade.  
Q8-1. Can Japan please list the agricultural and othe r primary products by tariff line covered by 
these export controls?  
A. The agricultural and other primary produc ts under export controls are as follows: 
 
(1) Wheat bran, rice bran, oat bran, fish flour, and fish waste (2) Feed mixtures (3) Seminal roots and seedlings of mint, and the mycelia of lentinus edodes (4) Seeds of larix leptolepis 
(5) Logs of kalopanax pictus, betulaceae, and quercus (including hewn squares and lumber 
having at least 30% curvature at the minimum cross-section) 
(6) Eels (fry for fish culture) (7) Frozen baby clams, hard clams and sea mussels  These products are not prescribed by tariff line. 
 
Q8-2. Can Japan provide details of whether the e xport controls have been utilised in the past 
5 years, and if they have, can the value and volum e of the relevant products affected by export 
controls be provided?  A. To maintain national as well as internati onal peace and security, Japan controls exports of 
arms and certain dual-use items.  This measure is based on United Nations Security Council 
Resolution 1540 and other relevant international co mmitments such as international export control 
regimes.  In order to implement other inter national agreements such as the Convention on WT/TPR/M/211/Add.1 
Page 220  
 
  International Trade in Endangered Species of Wild  Fauna and Flora, Japa n controls exports in 
accordance with the Foreign Exchange and Foreign Trade Act.   With respect to the value and volume of the relevant  products, appropriate statistics are not available. 
 Q9. The Secretariat's report highlights the con tinuing significant disparity between agricultural 
and NAMA applied tariffs – 17.1% (a griculture) vs. 3.6% (NAMA).  
 Can Japan please explain whether it plans to implemen t a review and reform process to remove this 
disparity? 
 
A. The tariff level of a product is determin ed appropriately in accordance with a series of 
elements such as the level of th e product's domestic consumption, production and distribution.  Even 
if there is a disparity between the simple averages of agricultural and NAMA applied tariffs, that does 
not mean that the difference should be eliminated.  In any case, Japan will continue to make efforts to 
review and improve the tariff levels of agricultural products, taking into account of the result of DDA 
negotiations. 
 
Q10. Can Japan explain what the type and nature of non- ad valorem  duties are and how they are 
converted to ad valorem equivalent tariff rates? 
 A. In Japan, there are several types of non-ad valo rem duties, such as specific duties, selective 
duties, compound duties, price differential duties, and sliding duties.   The natures of these duties are as follows: (1) Specific duty: The tax base is set using a quan tity such as the number, volume, or weight of 
the import product. 
(2) Selective duty:  The ad valorem duty and non-ad  valorem duty are separately provided for the 
product, and one of the duties is applied. 
(3) Compound duty:  The ad valorem duty and the non-ad valorem duty are separately provided 
for the product, and the sum of duties is applied. 
(4) Price differential duty:  The tariff amount is  set as the difference between the import price 
and the threshold. 
(5) Sliding duty:  Beyond the threshold of the import price, duties are removed using a  
smoothing adjustment. 
 
The methods used to calculate the ad valo rem equivalents (AVEs) of these duties are: 
 
(1) Specific duty:  Specific duty/ (import value/import quantity)*100 
(2) Selective duty:  The AVE for the specific duty is calculated using method (1) if it is to be 
applied. 
(3) Compound duty:  the sum of the AVE for the specific duty is calculated using method (1) and 
the ad valorem duty. 
(4) Price differential duty and sliding duty: 
 First, the unit customs value is calculated based  on the import quantities and values. Then, the AVE is 
calculated for the difference between the unit customs value and the reference import price. 
 Q11-1. Can Japan please explain how a target of 45% was derived and how does Japan Plan to reach 
the target? Also, when is this target reviewed, if at all?   WT/TPR/M/211/Add.1 
 Page 221 
 
 
  A. The target rate for self-sufficiency of 45% by  FY2015 was set based on the estimated levels of 
production and consumption that c ould be achieved through various efforts described in the Basic 
Plan for Food, Agriculture and Rural Area(hereinafter "the Basic Plan"). 
 
To attain the target of food self-sufficiency, (1) on the consumption side, Japan carries out a nationwide campaign on plain and practical 
"food education".  The campaign include the  promotion of a "Balanced diet guide" to reduce 
left-over food and, 
(2) on the production side, Japan encourages production to meet consumers' needs by 
strengthening ties between th e food industry and farmers and by supporting core farmers who 
possess a better sense of business management. 
 
The target food self-sufficiency ratio is set as a part  of the Basic Plan, which is revised approximately 
every 5 years.  As 4 years have passed  since the last review, Japan has began consideration to revise 
the Basic Plan.  
Q11-2. Are greater levels of Government interv ention planned (i.e. through MAFF or ALIC) to reach 
the desired self-sufficiency ratio? 
 
A. In order to promote agricultural produc tion corresponding to consumer demand, Japan has 
been taking the necessary measur es to ensure the prices of farm products properly reflect the 
supply/demand situation and a qua lity of the products, as stipulated in the Basic Law on Food, 
Agriculture and Rural Areas. Japan will continue to pursue measures which comply with the WTO 
agreements.  
Q11-3. How much will the Government spend in th e financial years 2008-09 and 2009-10 on import 
substitution food education campaigns? 
 
A. Japan has budgeted 1.7 billion yen for FY2008 and FY2009 with the intent to promote 
domestic agricultural products, but there is no program or ca mpaign for import substitution. 
 
Q12-1. The Secretariat's report highlights that  Japan's overall level of government support for 
agriculture (based on PSE/CSE figures) remains well above the OECD average;  labour productivity 
is still less than a quarter of the national average and tariff barriers remain high. 
 Is there a link in Japan between the falling level of  food self-sufficiency, the heavy levels agricultural 
protection and the low levels of labour productivity?  
A. Japan considers the main reason for the fall of the food self-sufficiency ratio to be a decline 
of domestic productive power due mainly to the c hanges in diet styles of Japanese consumers and to 
the increase of imports of agricultural products through the opening of the domestic agricultural 
market. 
 
It is true that the labour productivity of the agric ultural sector is lower than the national average in 
Japan.  However, similar situations can be observed in other developed countries. 
 
In addition, the average tariff rate of agricultura l products in Japan is 12 % (OECD definition) in 
Japan, which is relatively low compared to that of other countries.  Furthermore, the level of 
Aggregate Measurement of Support (AMS) of  Japan is very low among the developed member 
countries.  
 WT/TPR/M/211/Add.1 
Page 222  
 
  Q12-2. The Secretariat's report highlights that  Japan's overall level of government support for 
agriculture (based on PSE/CSE figures) remains well above the OECD average;  labour productivity 
is still less than a quarter of the national average and tariff barriers remain high.  Will the agricultural sector continue to receive substantial support despite  this low productivity? 
 
A. Under the circumstances where the number of  undernourished people remains increasing and 
the global food supply and demand is projected to be tightened in the long-term, to leave land laying 
waste without producing any crops cannot be justifie d in terms not only of environmental concerns 
but also of our responsibility in the internationa l community.  Japan will therefore continue necessary 
fiscal and technical support in order to ensure su stainability of rural areas and agricultural sectors 
which not only supply food, but also offer various economic and social value. 
 
Q13. In January 2009 the Japanese Government a nnounced the establishment of a 'six ministers' 
conference on agricultural reform. 
 
Can Japan provide specific details of its agricultura l reform strategy, particularly in relation to 
addressing high food prices and low labour productiv ity, and achieving its goal of 45% food self 
sufficiency?  
A. Japan is going to examine agricultural policy,  and give careful consideration to the various 
factors surrounding agriculture and rural areas in Japan , such as the strengthening of the capacity of 
the food supply, promoting the rural economy, securing the food safety and consumer confidence. 
 
Q14-1. Can Japan explain the reasons for targeting particular farming groupi ngs ("core farmers") for 
the new direct payment assistance? 
 
A. To promote efficient and stable manageme nt, the new direct payment targets producers 
having operations of a certain scale who make effo rts in reforming their agricultural management. 
 
Q14-2. Can Japan please explain whether the sh arp reduction of Japan's amber box support has 
affected its agricultural production?  
 
A. As the new direct payment measures have put into operation as from FY2007, sufficient data 
are not made available in order to analyse the eff ect of these measures on agricultural production.    
 
Q14-3. Furthermore, have the reforms been effectiv e in reducing the trade-distorting nature of Japan's 
domestic support regime, especially for rice?  
 
A. Japan is now examing how to classify the new direct payment measures for covered crops, 
including rice.  The Committee on Agriculture will be  notified of the final classification decision.  
 
Q14-4. What amendments has Japan made to ne w direct agriculture payment assistance measures 
since they were implemented? 
 
A. The measure introduced in April 2007 were amended in April 2008.  With the amendment,  
farmers approved as "core farmers" by munici palities could receive support through the measure 
regardless of their farming scale. 
 
Q14-5. Have these changes undermined the origin al policy intent of the measures to increase 
economies of scale and therefore the efficiency  and competitiveness of the Japanese agriculture 
sector?   WT/TPR/M/211/Add.1 
 Page 223 
 
 
  A. This amendment does not change the original intention of the policy as the purpose of the 
amendment was only to take into account further the different situations in each area.  This measure 
still targets farmers who make efforts in  reforming their agricultural management. 
 
Q15. Japan uses a "historical reference amount" to  determine whether farmers may receive income 
support. 
Can Japan explain what the specified ba sed period is, and how it is determined? 
 
A. In consideration of the various planting syst ems used in different regions, the based period 
has been set as the previous 3 years before the measure was introduced (from 2004 to 2006).  
 
Q16-1. Japan has sizable applied tariff peaks, with  a reported applied rate of 578.6% for peas (FY08). 
This may still not provide a full picture since many other highly protected products like dairy, swine, rice and cereals, do not have available AVEs (93 tariff lines at the 9-digit level).  For example, the AVE for rice in the past has b een in the vicinity of 700%. 
 
Can Japan please justify the need to maintain such high tariff levels? 
 
A. Japan sets an appropriate tariff rate on each product, taking into consideration the situation 
of respective domestic sectors.  This is consistent  with WTO Agreements.  Japan will continue to set 
appropriate tariffs while considering the results of DDA negotiations.  
 
Q16-2. Can Japan please explain why AVEs were not available for the 93 tariff lines, many of which cover products of importance to exporters from other countries, especially developing countries? 
 
A. The application of non ad valorem tariffs on certain agricultural products in Japan is 
consistent with the WTO agreements.  Applying a n on-ad valorem tariff in itself is not necessarily a 
burden on consumers, and it has certain advantages;   for example, duty amounts can be easily 
calculated by the quantity or weight of importe d goods.  Japan will continue its efforts to set 
appropriate tariff types and levels in line with the results of DDA negotiations. 
 
Q16-3. What domestic reforms is Japan undertaki ng to enable the removal of these tariff peaks? 
 
A. Japan maintains and implements its tariffs  in line with Japan 's Schedule and WTO 
agreements.  Regarding domestic reforms in agric ulture, Japan has implemented these reforms to 
strengthen the capacity of the food supply, to promote rural economies and ensure food safety and 
consumer confidence.  Japan will encourage the stru ctural reform of the agricultural sector, and 
there by foster the competiti veness of domestic farmers. 
 
Q17. Can Japan explain the justification for these ki nds of non-tariff barrier (NTBs) restrictions and 
how they affect the level of imports and tariff quota fill rates?  
A. The tariff rate quota system charges a lower duty rate or exempts customs duties on imports 
for certain products, within a certain quantity, in or der to allow consumers to  enjoy less expensive 
imported products.  It is for this reason that J apan maintains allocation requirements, in order to 
fulfil the needs. 
 
Q18-1. Can Japan please explain the justificati on for these kinds of non-tariff barrier (NTBs) 
restrictions and how they affect the leve l of imports and tariff quota fill rates? 
 
A. In regard to imports of agricultural pr oducts, Japan has been implementing all relevant 
measures in accordance with Japan's schedule and WTO agreements.  In Japan, there exists a strong WT/TPR/M/211/Add.1 
Page 224  
 
  concern about food security in the grand public, th ese measures are therefor e necessary to secure 
stability between the supply and demand of these products.  
 
Q18-2. Can Japan please explain why it doesn't no tify all the additional ma rk-ups, surcharges and 
levies when reporting its applied tariff to the WTO Secretariat? 
 
A. The additional measures which Australia ref ers to are implemented in accordance with 
Japan's schedule and the WTO agreements.  Japan has already fulfilled its WTO notification 
obligations on this matter.  Japan will continue  to implement appropriate measures, taking into 
account the result of DDA negotiations. 
 
Q18-3. Can Japan please explain the legal basis fo r these kinds of duties when Article 4.2 of the 
Agreement on Agriculture requires all variable im port levies, discretionary import licensing, and 
non-tariff barriers maintained by state-trading enterp rises to be converted to ordinary customs duties? 
 A. Japan is convinced that the additional measu res which Australia points out are implemented 
in accordance with the Japan's schedule and are consistent with WTO agreements.  
 
Q18-4. Are there any requirements or obligations  for sugar importers to sell or purchase imported 
sugar to or from the ALIC in order to receive preferential market access?  
If so, could Japan explain the related administrativ e arrangements, including importing and on-selling 
rights, together with any pricing arrangements?  
A. All importers who import sugar that is affect ed by the levy need to follow the appropriate 
procedures of the ALIC.  
 
The quantity limitation and the exemption from the secondary levy is established in correspondence 
with the actual imports of the previous year and th e domestic production capacity as set out by the 
Sugar and Starch Price Adjustment Law.  The procedure under this law doesn't impose any restriction on importing or selling rights. 
 
Q18-5. With the possible conclusion of the Doha  Round in 2009 and the focus on market access and 
the option for tariff quota expansion, can Japan en sure that any new tariff quotas resulting from the 
Doha Round will not be subject to ALIC or MAFF control, end-use requirements, simultaneous buy-
and-sell (SBS) systems, surcharges and mark-ups? 
 
A. Japan is convinced that the current Japanese tariff quota regime is consistent with WTO 
Agreements and implemented appropriately in line w ith Japan's tariff schedules.  In regard to DDA 
new tariff quotas, Japan has not yet decided how to  administer them as the DDA negotiations are still 
in progress.  In any case, Japan will implement th e quotas appropriately, based on the results of DDA 
negotiations. 
 
Q19. Australia notes that the services sector is th e largest contributor to GDP and employment in 
Japan. Australia further notes inwa rd FDI in Japan is relatively lo w compared with that of other 
OECD countries.  As the WTO Secretariat Report st ates, Japan is taking measures to make itself a 
more attractive investment destination for foreign firms, in order to further benefit from this vital 
sector. 
 Will these reforms include revising Article 821 of th e Corporations Law, which prohibits foreign 
companies from doing business in Japan in branch form under certain circumstances? 
  WT/TPR/M/211/Add.1 
 Page 225 
 
 
  A. Japan does not plan to amend Article 821 of the Companies Act at this stage. 
 While Japan continuously watches for any impacts c aused by Article 821 of the Companies Act, it has 
not recognized any actual pr oblem caused by the said provision.  The said provision regulates only "a 
foreign company which is constituted or organized under the law of the foreign country, and has its 
head office in Japan or whose main purpose is to conduct business in Japan" (a so called "pseudo-
foreign company").  This provision is stipulated to  avoid situations such as one where a company is 
established under foreign laws for the purpose of circumventing the application of Japanese laws.  
Therefore, Japan does not consider that Article 821 of the Companies Act prevents foreign companies 
which are duly conducting business outside J apan from establishing a branch in Japan. 
 
Q20. The Financial Instruments and Exchange Law (FIEL) entered into force in Japan on 
30 September 2007.  Under the FIEL, the types of "other business" that firms can undertake are not defined.    
Will Japan consider modifying FIEL to include langu age that makes it clear to businesses in the funds 
management business what types of business they can engage in?  
A. The investment management business is to c onduct any of the following businesses,  as 
provided for in the Financial Instruments and Exc hange Act: Asset Investment Business of Investment 
Corporation (Article 2-8 (xii) (a)), Discretionary Inv estment Contract Business (Article 2-8 (xii) (b)), 
Business Entrusted Investment Trust (Article 2-8 (xiv)), and Self-Investment (Article 2-8 (xv)). 
 Investment management business operators can conduct business corresponding to Financial 
Instruments Business adding to its businesses, whose scope   is provided for by the Act (Article 35-1). 
Moreover, by notifying the FSA in  advance, they can conduct certain business, whose scope is also 
provided by the Act. (Article 35-2, 3) 
 With respect to the businesses other than these, they can conduct such business by obtaining 
authoritative approval.  However, the Prime Mi nister may choose not to approve only where the 
implementation of the business pertai ning to the application is found to  go against the public interest 
or hinder the protection of investors due to the difficu lty in management of the risks of loss arising 
from the business. (Article 35-5) 
 In conclusion, the business of investment manageme nt operators is explicitly defined in the Act and 
Japan does not intend to revise the Act. 
 Q21. At the WTO Ministerial Services Signalli ng Conference in 2008, Japan indicated it may be 
considering new commitments on Modes 1 and 2 in Higher Education.  Can Japan provide further details of these possible new commitments?  
A. While Japan refrains from answering this questi on in writing, Japan holds the view that it is 
important to preserve the outcome of the WTO Mini sterial Services Signalling.  Conference of 2008 
as a good basis for further negotiation.  With this in mind, Japan would like to actively participate in service negotiations and hopes that the "service clus ter meeting" from the end of March will be a 
good restart for the negotiations with capital-based participation from as m any Member countries as 
possible.  
 
Q22. Japan's "Basic Policies 2008" released by the Council for Economic and Fiscal Policy says 
that Japan will enhance its international hum an resources by implementing the "Plan for 
300,000 Exchange Students" in Japan  and enlarging the immigration program to accept more skilled WT/TPR/M/211/Add.1 
Page 226  
 
  foreign workers.  Australia notes that similar pr oposals have been put forward in previous CEFP 
reports, such as the "Strategy in the Globalizing Economy" of 2006.  Could Japan provide an update of the specific measures which it is putting in place to realize this goal, 
including extensions of eligible visa periods and increasing the rage of professionals granted 
permission to work in Japan. 
 
A. In July 2008, six related ministries, including the Ministry of Education, Culture, Sports, 
Science and Technology (MEXT), formulated the fram ework of a plan to accep t 300,000 international 
students.  Toward the goal to accept 300,000 in ternational students into  Japan by around 2020, the 
related ministries and institutions will be co llaborating and developing diverse measures ranging 
from inspiring students to want to study in J apan to assisting with their career paths following 
graduation or obtaining a degree.  In order to promote acceptance of highly-skilled foreign workers to Japan, Japan has held meetings 
of "the Council on the Promotion of Accepti ng Highly-Skilled Foreign Workers."  The council, 
composed of economic and labor leaders, and schola rs, as well as government members, was founded 
based on "Basic Policies 2008."  Japan is planning to formulate an action program on the acceptance of foreign skilled workers by the 
summer of 2009 based on the discussions and decisions of the council. 
 
 
NORWAY
 
 All the questions are related to the WTO Secretariat's report (WT/TPR/S/211). 
 Q1. Para. 7 states that "About 96% of Japanese I ndustrial Standards (JIS) were aligned to their 
international counterparts in 2008 (compared with 93% in 2005)".  Could Japan provide information 
if there are any plans on further enhancing the comp atibility of Japanese Industrial Standards (JIS) to 
international standards?  Are there available stat istics regarding the application and acceptance of ISO 
standards in Japan?  
A. Japan has been making every effort to align JIS to international standards so far.  Presently, 
there are no concrete plans to further enhance compatibility. 
 
There are no available statistics which can show the mentioned application of ISO standards, and 
Japan is not planning to set up such statistics.  However, it is possible to respond to specific inquiries. Please contact the TBT enquiry point of Japan.   
 
Q2. As reflected in para. 47, Japan has continue d its efforts towards international harmonization 
of its standards and technical regulations.  Could Jap an please elaborate on the efforts that have been 
made since their last trade policy review, a nd indicate whether new initiatives are foreseen?  
 A. Japan has been aligning its existing standards  and technical regulations to international 
standards, and ensuring compliance with th e WTO/TBT Agreement when standards are newly 
established or revised.  Japan will continue such efforts. 
 Q3. Para. 61 states that "the government intends to reduce lead time and charges at ports by 
adopting concrete measures to realize cost-reducti on targets under the Super-Hub Port Project".   WT/TPR/M/211/Add.1 
 Page 227 
 
 
  Could Japan please shed some light on which concre te measures will be implemented, and indicate 
when the project will be completed.  
A. The concrete measures are as follows: the development of deep  berths and large yards to 
handle large-sized container vessel s, improvement of accessibility, and the improvement of efficiency 
of the container terminal management and operations  by private enterpris es.  The Super-Hub Port 
Project will accomplish its goal by FY 2010.   
 
Q4. Many shipping countries face challenges in r espect of recruiting national seafarers (as it is 
indicated in para. 62).  Has Japan any measures in force in order to stimulate the use of Japanese 
seafarers (i.e. taxation or similar measures)?  
A. Japan is trying to increase the number of Japanese seafarers by diversifying training courses 
for them.  
Q5. We understand from the report's para.62 that no discriminatory measures exist with respect to 
supply of auxiliary services, except for mode 1 and 3 of maritime freight forwarding services.  Could 
Japan elaborate on the discriminatory measu res that exist for freight forwarding? 
 
A. The reason why Japan introduces a reciprocity principle in freight forwarding services 
concerned in international freight transport is to  ensure fair business activities in this sector which 
has a variety of regulations in foreign countries.  Therefore, foreign forwarders are examined based 
on the principle of reciprocity. If the regulations  in the foreign countries are more rigorous than those 
in Japan, they will be taken into considerati on, and similar restrictions may be imposed. 
 Q6. Para. 63 gives information on a new tonnage tax system. Could Japan please provide 
information on which companies that are eligible fo r the tonnage tax?  Is the new system open for 
foreign flagged vessels and/or companies? We w ould also like to know how tax liabilities from the 
previous tax system are being treated.  Do such li abilities have to be paid, or are they suspended or 
remitted?  
A. A shipping company may calculate and pay its corporate tax upon the assumed profit per net 
tonnage of Japanese flagged vessels for international trade operated by the company provided that 
the company obtains approval from the Minister of Land, Infrastructure, Transport and Tourism 
(MLIT).  The tonnage tax applies only to Japanese flagged ve ssels.  Foreign flagged vessels, even if operated 
by approved companies, are not eligible for the tonnage tax system. 
 No deferred tax liability is underta ken for the previous tax system in the case that the company adopts 
the tonnage tax system. 
 
Q7. Norway would also like to request informati on on the requirements for a lock-in period in the 
tonnage tax system. 
 
A. The company may not select the previous cor porate tax system for five accounting years after 
the tonnage tax system has been applied.  
Q8. Para. 64 reads as follows;  "Agreements betw een domestic and forei gn operators on freight 
rates or other conditions of transport (e.g. rout es) are exempt from the Anti-monopoly Act…".  These 
kinds of agreements have been restricted or banne d in other parts of the world for various reasons 
during the last years.  Due to this fact, shipping  companies are exposed to conflicting legislation on WT/TPR/M/211/Add.1 
Page 228  
 
  certain trade routes.  On this background, we w ould like to ask Japan if the Japanese authorities have 
any plans of reform of competition rules in the area of maritime transportation.  A. The International Maritime Transport Sub-co mmittee, a special group under the Maritime 
Affairs Section of the Council for Transport Policy,  which is a ministerial advisory body for the 
Minister of Land, Infrastructure, Transpor t and Tourism, considered in 2007 whether the 
antimonopoly exemption for international shipping  activities remained necessary.  After careful 
consideration, the Council recommended in December 2007 that further consideration be given to 
this issue from the viewpoint of ensuring a comp etitive international shipping market as well as 
ensuring stable and reliable maritime transport.  Acco rdingly, the Ministry of Land, Infrastructure, 
Transport and Tourism intends to make further studi es on this issue from the following four points of 
view which were described in  the above recommendation: 
 1) The antimonopoly policies taken by other nations and the impact of those policies on the 
Japanese shipping industry 
2) The development of the int ernational shipping market including the emergence of large 
shipping companies 
3) Whether the agreements among shipping companies function to supply a stable shipping 
service 
4) The impact of the abolition of the anti-monopoly exemption on the Japanese economy  
Q9. Para. 65 states that:  "In Japan's revised  services offer, maritime cabotage services, 
international freight forwarding, and international shipping services are subject to MFN exemption".  
In the list of MFN-exemptions "all countries" are listed as candidates to which the respective measure 
applies.  Could Japan shed some light on the actua l use of any of these measures?  We would also 
kindly ask Japan to provide an updated list of the countries that the MFN exemption would apply to, 
and we would appreciate if the list could indicate any entries of new countries to the list over the last 
10 years.  A. The right of maritime cabotage has been estab lished internationally from the viewpoint of 
sovereignty and national security of individual countries.   As with many maritime nations, Japan has 
restricted maritime cabotage to Japanese vessels ba sed on the Ship Law, except in cases otherwise 
provided for in other laws or treaties.  In a ccordance with the above regul ation, maritime cabotage 
may be granted exceptionally on a case-by-case basis  upon individual application in accordance with 
bilateral agreements such as treaties of amity , commerce and navigation.  Therefore Japan can not 
specify the countries to which MFN exemption would apply.  With regard to international shipping services,  Japan maintains MFN exemption because Japanese 
shipping companies suffered an unreasonable loss by a unilateral sanction in the past and there still remains the risk of such a unilateral sanction.  C onsequently, the possibility of withdrawing the MFN 
exemption depends on the outcome of this round of negotiations.  Therefore Japan can not specify the 
countries to which MFN exemption would apply.  The reason why Japan has listed the international freight forwarding services in its MFN exemption 
list is to ensure fair business activities in this s ector which has a variety of regulations in foreign 
countries and to grant operation permission or  registration on a reciprocity principle.  
 With regard to MFN exemption, the treatment of this measure will depend on the outcome of this 
round of negotiations.  Therefore Japan can not specify the countries to which MFN exemption would apply. 
  WT/TPR/M/211/Add.1 
 Page 229 
 
 
  Q10. Para.68 describes the developments in the Japanese civil aviation polic y.  We are pleased to 
note that Japan has started to liberalize its civil aviation policy.  Could Japan please elaborate on the 
liberalization process, and estimate a time schedule towards a full open skies policy?  
A. Japan is promoting an aviation liberalizati on policy based on the "Asian Gateway Initiative."  
As of February 2009, Japan has concluded bilate ral negotiations with seven Asian countries and 
regions (the Republic of Korea, the Kingdom of  Thailand, the Macau SAR, the Hong Kong SAR, 
Viet Nam, Malaysia and Singapore) to remove re strictions reciprocally on entry points, and the 
number of flights related to third and fourth freed om traffic, except for routes linked to metropolitan 
airports in Japan due to limited airport capacity.  Further negotiations with  other Asian countries will 
follow to achieve the above goal.  
 
ARGENTINA
 
 
Q1-1. According to the report, Japan recently introdu ced a tax reform with a view to broadening the 
tax base and rationalizing corporate tax.  The report also indicates that Japan will soon be raising the 
consumption tax rate.  What does this tax reform consist of? By how much will the consumption tax rate  be raised and when will this happen? 
 A. Japan has kept, and will keep, reviewing special taxation measures in light of their objectives 
and effects as well as their appropriateness as a policy tool.  A fundamental reform of the taxation system, which includes a revision of consumption tax, will be 
implemented on condition that an upturn in the economy will be achieved through economic stimulus 
measures.  Concrete measures to be taken in this  reform, including how much the consumption tax 
rate will be raised, and how this reform w ill be implemented are still under discussion. 
 
Q1-2. The report states that in 2007, the Government revised regulations concerning FDI in order to prevent foreign investments form adversely affect ing the maintenance of Japan's defense-related 
industrial base and the proliferation of sensitive t echnologies related to weapons  of mass destruction. 
Under the revision, products that are deemed "conver tible to military equipment" are added to a list of 
products subject to prior notification.  What are th e products that are deemed "convertible to military 
equipment"?   
A. Please refer to the following list of the public notice of 2007 including the products that are 
deemed "convertible to military equipment". 
 Appended Table 1 (i) Manufacturer of the following products  (a) Weapons or products designed exclusively for activities (including transportation, 
communication, supply, search and rescue) to support use of any weapons or for 
defense against armed attacks 
 (b) Airplanes  (c) Satellites (including flying objects launc hed outside the orbit around the earth and 
artificial objects placed in celestial objects.  Hereinafter the same), devices or 
propellants designed exclusively for rockets, their launches, tracking and control, or 
use, or materials for such devices and propellants 
 (d) Nuclear reactors, nuclear turbines, power generators for nuclear plants, nuclear 
source materials or nuclear fuel materials WT/TPR/M/211/Add.1 
Page 230  
 
   (e) Accessories for products listed in (a) to  (d); components of products listed in (a) to 
(d) and of their accessories; material s exclusively designed to be used for 
manufacturing them or devices, tools, equi pment to measure, examine or test them; 
(ii) Mechanical repair services pertaining to produc ts listed in (a) to (e) in the preceding item 
(iii) Software services related to programs exclusivel y designed for the use of products listed in 
(a) or (b) of item (i) 
(iv) Software services related to programs exclus ively designed for satellites, rockets or their 
launches, tracking, control or use 
(v) Manufacturers listed in 2 to 4 of the Appende d Table 1 of the Import Trade Control Order 
(Cabinet Order No. 378 of 1949) 
(vi) Manufacturers listed in paragraph 5, (iii), (v) to  (viii), (xiv), (xvi), and (xviii), paragraph 6, 
(i) to (iv), (vi) or (vii), paragraph 7 (i), (vi), (vii), (ix) and from (xvi) to (xix), paragraph 8-
middle column, paragraph 9 (i), (iii) and from (vi)  to (xi), paragraph 10, from (i) to (iv), (vi), 
(vii), (ix) and (xi), paragraph 12, (i), (ii) , (v) and (vi), paragraph 13, (v) and paragraph 
15-middle column, of the Appended Table 1 of the Import Trade Control Order. 
 
Q2. The report states in this paragraph that th e Government introduced a project to promote 
foreign direct investment in selected regional govern ments, and that in 2007, 17 regions had been 
selected for the application of such measures.  1) What, exactly, is this project to promote FDI? 
2) What are the criteria for selecting the re gions that will benefit from this regime? 
3) What requirements do foreign companies have to meet in order to be eligible for this 
incentive? 
 
A.1. This project aims to promote FDI in local regions. 
2. The Government of Japan selects the regions by  judging whether or not a local government 
has a plan to make effective use of local resources. 
3. Our requirement for foreign companies is only to have a plan to establish a company in 
Japan. 
 
Q3. What trade measures have been  taken by Japan in response to the international financial and 
economic crisis since July 2007, particularly in th e area of subsidies, nationalization and other forms 
of State support?    
A. Given the current economic crisis, it is necessa ry to counter the emergence of protectionism. 
Japan has therefore made a standstill commitment agai nst the introduction of new measures intended 
to protect the Japanese market, as has been stated in declarations made at the Summit on Financial 
Markets and the World Economy, APEC Economic Leaders' Meeting, and Japan-China-ROK 
Trilateral Summit.   
Q4. According to the report, the Japanese author ities planned to introduce the Common Portal for 
the Next Generation Single Window in October 2008 with the intention of unifying electronic 
application formalities among various agencies.  C ould you please confirm whether this Portal is 
already in operation, and if not, what is the status of the project and the estimated date of entry into 
operation?  
A. The single window (common portal) was established in October, 2008. 
 
Q5. In this paragraph, the report states that Jap an maintains a system of prior confirmation to 
collect data on certain imports, to ensure that th ey are for specific uses, and to verify documentation 
and origin requirements.  What products are covered by this confirmation system? 
  WT/TPR/M/211/Add.1 
 Page 231 
 
 
  A. The articles under prior confirmation are th e chemicals used for testing and research and the 
substances which are listed in the Annex of the Montreal Protocol on Substances that Deplete the 
Ozone Layer and which are assumed to be restriction exceptions (those used as raw materials in the 
manufacturing process of other substances, used  for testing and research or analysis, and those used 
for medical purposes placed under quarantine duri ng import and export), tuna, and so on. Please 
refer to the following website for further details.  
http://www.cas.go.jp/jp/seisaku/hourei/data/ITCO.pdf   
 
Q6. The report states in paragraph 78 that tax incentives in Japan are set out in the Special 
Taxation Measures Law, which has be en amended annually.  As an example, the report states that tax 
incentives are offered for broadband dissemination.  What exactly are the ta x incentives provided for 
in this Law and what sectors benefit from them?  What  are the criteria for their application, and what 
is their time-frame?  
A. The Special Taxation Measu res Law provides various special and provisional tax measures 
such as a special tax rate, the reduction and exempti on of tax, or special treatment regarding the due 
date of tax return, that are designed in accordan ce with various policy objectives.  These measures 
are applicable equally to taxpayers meeting objective requirements, as is stipulated clearly in laws 
and regulations.  Each measure has different re quirements and employs time-frame in accordance 
with the respective purposes of the measu res, in addition to other elements.  
 Q7-1. What IPRs are these ex offi cio intervention meant to protect? 
 
A. Japan Customs has ex officio authority to suspend goods infringi ng trademarks, copyrights 
and related rights, patents, industrial designs, utility model rights, lay-out designs, plant breeders' rights and goods constituting unfair co mpetition such as imitation goods. 
 
Q7-2. What is the procedure by which Customs determined whether the goods are infringing IPRs 
and what possibilities are the parties involved given to defend their cases?  
A. Japan Customs has the authority to judge infringement of IPR in the identification 
procedures.  In the procedures, it provides rights holders and importers/exporters with enough 
opportunities to submit their opinions and evidence.  It makes a decision on infringement by carefully 
examining their opinions and evidence. 
 
Q7-3. What is the maximum time within which Cu stoms must determine whether there has been an 
infringement?  On the basis of the experience gained so far, what is the aver age time taken to identify 
the infringement?  
 
A. The maximum time of the procedure is not de fined by law but the procedure usually takes a 
month.  
Q7-4. Does this procedure apply to goods in transit? Is there a fast track mechanism? 
 
A. The identification procedures do not apply to goods in transit. In cases where imported goods 
are the subject of applications for suspension s ubmitted by rights holders and the goods are suspected 
of goods infringing trademarks, copyrights and relat ed rights, plant breeders' rights or constituting 
unfair competition such as imitation goods, Japan Customs take simplified identification procedures. 
 
Q8. These two paragraphs refer to Japan's coopera tion activities and state that on 18 June 2008, 
the IP Headquarters issued the Intellectual Prope rty Strategic Programme (IPSP) for 2008, which was 
to review Japan's intellectual property strategy from an international perspectiv e.  This review would 
focus, inter alia , on "exercising leadership in coping with common global issues, particularly issues WT/TPR/M/211/Add.1 
Page 232  
 
  facing Asian countries."  According to the report, the strategy aims above all to promote international 
harmonization of IPR application a nd examination procedures.  Will th is international strategy cover 
other areas as well, for example issues relates to th e WIPO Development Agenda  or other regional or 
multilateral initiatives?   A. The Intellectual Property Strategic Progra mme (IPSP) for 2008 aims to strengthen the 
intellectual property strategy from a global viewpoi nt. International aspect of the strategy address 
measures including capacity building, ta king account of development aspects.  
 For the details of specific issues, pl ease see pages 17 to 21 of the IPSP 2008. 
http://www.kantei.go.jp/jp/singi/titeki2/keikaku2008_e.pdf  
Q9. Paragraph 108 states that, among other th ings, the 2006 amendment of the Anti-Monopoly 
Act introduced a "leniency programme" for companies.  What is this programme?  A. A "leniency program" is a system whereby surcharges are immunized or reduced on the 
condition that the entrepreneurs wh ich have been involved in cartels or bid riggings, voluntarily 
inform the JFTC of their in volvement in such matters.  
 
Q10. According to paragraph 24, Japan has a Law on Special Measures for the Revitalization of Industrial Dynamism (Industrial Revitalization Law), intended to promote restructuring and 
innovation, such as granting of tax reduction to ac quisition plans approved by competent ministries. 
 What are the tax reduction referred to in the report?   Are there other tax benefits?  What are the 
eligibility requirements?  A. Japan extends accreditation to companies appl ying under one of six types of business 
revitalization plans.  These types are A plan (Self- Restructuring Plan), B plan (Business Transfer & 
Restart Plan), C plan (Co-Restructuring Plan), D plan (Pilot Investment Plan,). E plan (Technical Innovation Plan) and F plan (Managerial Resources Integration Plan.)  Companies can implement D 
plan and another of the 5 plans at the same time.   Japan provides following four tax reductions to 
accredited applicants under the Industrial Rev. Law:  (1) A deduction of registration and license taxes 
to the accredited applicants of A, B, C, E, F.  (2) 20% or 30 % accelerated depreciation to the 
accredited applicants of all plans.  (3) The accredited applicants of A, B, C may treat depreciation in 
property value as a loss.  (4) A deduction of rea l property acquisition tax to the accredited applicants 
of A, B, C, E, F. 
 
Requirements (Target setting)  For all plans (other than D) 
1. interest-bearing liability to cash-flow ratio and 2. current income must be greater than or equal to 
current expenditure  
For plans of A and E 
1. a return on equity or 2. asset turno ver ratio or 3. added Value per employee 
 
For plans of B, C and F (Measure in business unit) 
1. return on assets or 2. asset turnover ratio or 3. added Value per employee 
 Q11. Could you please tell us what sectors require notification and what sectors require permission 
and/or ex post reporting? 
  WT/TPR/M/211/Add.1 
 Page 233 
 
 
  A. Since the regulatory regime on inward FDI varies depending on relevant laws and 
regulations, it is difficult to generalize it by sectors. 
 
Q12. Paragraph 63 of the report states that the Government amended the Maritime Transportation 
Law in 2008, and introduced a "tonnage tax" app licable to international maritime transport. 
 a) Why was this tax introduced? 
 b) What is the methodology used for its calculation?  
A. a) In order to level tax regime with other countries as well as to strengthen international 
competitiveness of Japanese-flagged vessels and Japanese seafarers, Japan has introduced 
the tonnage tax. 
b) 1.  If (i) exceeds (ii), then the difference is calculated as lo sses, and if (ii) exceeds (i), then the 
difference is calculated as profits.  
 (i) The actual income of shipping business gained from Japanese flagged vessels 
 (ii) The profits calculated from the follo wing formula:  The assumed profit per 100 net 
tonnage per day × the number of net tonnage × days of operations 
 2.  The level of the assumed profit will be set  taking into account those of other countries. 
 
Q13-1. On the subject of fisheries subsidies, what  is their impact on trade and the environment, and 
in particular, have measures been taken to ensure that they do not contribute to overcapacity and 
over-fishing? 
 
A. Japan is of the view that its fisheries subsid y programs, which are notified in accordance with 
SCM Agreement, do not cause any trade distortion. Japan also considers that its fishery subsidies do 
not lead to overcapacity or overfishing, as Japan ese fisheries are under the control of various 
management mechanisms. 
 
Q13-2. In addition to what Japan notif ied the WTO in document G/SCM/N/155/JPN on 
3 September 2007, could the Japanese Government please tell us whether the programmes are still in 
force, whether there have been any amendments, and whether any new programmes have been added 
to those already notified ?  A. Japan is now preparing to submit a new and full notification, in a timely manner and in 
compliance with its obligations under Article XV I:1 of the General Agreement on Tariff and Trade 
1994 and Article 25 of the Agreement on Subsidies and Countervailing Measures.  With respect to the 
enquired notification, please refer to the new docum ent, which will be submitted in due course. 
  
COSTA RICA
 
 
Q1. How does the system of material safety data  sheets work?  Does it apply to products imported 
from third countries?  What types of products does the system cover? (Page 47-48, paragraph 51) 
 
A. In Japan, there are several laws reauiring th e use of Material Safety Data Sheets (MSDSs). 
The Industrial Safety and Health Law, which is one  example of such a law, reauires transferors and 
suppliers, including importers, to utilize MSDSs even  for products imported from  third party countries 
as far as they are transferred or supplied in Japan.  Currently, 640 chemical and other substances, excl uding products made fo r the use of private 
consumers, are subject to MSDSs according to the Industrial Safety and Health Act.  
 Q2. Are foreign inspection bodies designated by the Japanese authorities without there being any 
recognition agreements? WT/TPR/M/211/Add.1 
Page 234  
 
  Are the mechanism provided for in bodies such as ILAC and the IAF applied?  
 Is the certification delivered by designated fore ign inspection bodies sufficient for products to enter 
Japan?  A. (1) The Electrical Appliance and Material Safety Law, Consumer Safety Law and Gas Utility 
Law and High Pressure Gas Safety Law. 
Under the Electrical Appliance and Material Safety Law, Consumer Safety Law and Gas Utility 
Industry Law (hereafter refer to as "Laws") a foreign  conformity assessment body can be registered 
by the Government of Japan as a conformity assessment body which can perform conformity 
assessments and certifications according to the La ws, whether or not the body’s home country 
concluded a MRA with Japan.  To the extent cove red under the Laws, certification delivered by those 
designated foreign inspection bodies is su fficient for products to enter Japan.  
 In addition, foreign manufactures of containers and Designated Equipment for high pressure gas 
which are registered by the Japanese government have b een allowed to testify the legal compliance of 
their products independently under the High Pressure Gas Safety Law. 
 
The above-mentioned schemes are equally provided  for all applicants which meet the criteria 
stipulated in the respective Laws , whether they are affiliated with ILAC or the IAF or not.  
 
Therefore, foreign producers which export electri c products, consumer pr oducts and gas related 
products to Japan enjoy the same opportunities for c onformity assessments by  CABs or independent 
testification of compliance of their products, as  Japanese domestic producers, not only in Japan but 
also in the countries where Foreign Registered Conf ormity Assessment Bodies or manufactures exist.  
 
(2) The Industrial Health Safety and Health Law 
 Foreign inspection bodies can be designated by  the Japanese authorities without any recognition 
agreements between their countries and Japan.  There is no available mechanism for bodies such as ILAC and the IAF to appoint as "designated 
foreign bodies for inspection."  Only the Ministry of Health, Labour and Welfare can designate an 
inspection body.  "Designated foreign bodies for inspection" certify th at a product complies with Japanese regulation 
standards in foreign countries (inspection must be done for each product individually).  Items 
inspected and certified by "designated foreign bodies fo r inspection," are exempted from inspection in 
Japan. 
 
Q3. What were the results and conclusions reach ed by the Japanese Food Safety Commission with 
respect to the safety assessments of geneti cally modified foods conducted since 2003? 
 A. The Food Safety Commission has been undert aking safety assessments of Genetically 
Modified (GM) foods in accordance with Cod ex guidelines since July 2003.  The Food Safety 
Commission has assessed the safety of 39 GM crops, 13 food additives and 17 types of feed. 
 For details, please consult the website:  http: //www.fsc.go.jp/hyouka/hy_s inkaihatu_idensi.html 
 
Q4. According to Japan's Food Sanitation Law, imported food may be exempted from inspection if, upon importation into Japan, it bears the result of  the inspection conducted by an official inspection  WT/TPR/M/211/Add.1 
 Page 235 
 
 
  organization in the exporting country.  What is the required procedure for the government of the 
exporting country to be able to benefit from this acceptance?  (Page 50, paragraph 60) 
 
A. It is not obligatory to attach the test results obtained in the exporting country to the import 
notification forms at the point of entry.  In th e case that importers conduct tests voluntarily or 
following administrative consultation, these tests can be done at the Ministry of Health, Labour and 
Welfare (MHLW) registered overseas laboratories.  This treatment will not be applied to the test 
items such as bacteria and mycotoxins, since the state of these items are liable to change during 
transportation.  
To be registered with the MHLW, laboratories mu st be capable of conducting tests using AOAC 
methods approved by AOAC International, or be ca pable of using equivalent methods, and should be 
either  1) Laboratories under the direct control of the national or state government of the exporting 
country (official laboratories);  or 
 
2) Laboratories certified or designated by the national or state government of the exporting 
country (designated laboratories). 
  CHILE
 
 
Q1. What is the duration of safeguard, anti-dum ping and subsidy investigations?  Are there 
differences between them?  A. Those investigations are to be concluded with in one year of the date of their initiation, and 
only in cases where there are special circumstan ces in which a time extension is deemed to be 
necessary, will such an extension be granted.  This is in accordance with domestic law, which is 
consistent with the WTO Agreements. 
 
Q2. Does Japan have any quantitative data concerni ng the impact of its export promotion policies? 
 
A. The Ministry of Economy, Trade and Indust ry implemented a quantitative analysis of export 
promotion policies as the policy assessment in 2006 .  Please refer to the following website for the 
further information (Japanese only). http://www.meti.go.jp/policy/policy_managemen t/17fy-jigo-hyoka/bouekishinkou/17FY-JIGO-
bouekishinkou.htm. 
  PAKISTAN
 
 Q1. Japan has entered into many bilateral tr ade agreements recently with a distinctive 
phenomenon of creating new TRQs especially for these bilateral agreements.  We would appreciate if 
Japan could share the experience of using this tool  and its compatibility with WTO rules dealing with 
such bilateral agreements.  A. While GATT Article XXIV paragraph 8 do es not specify a quantitative benchmark for 
"substantially all trade," Japan is of the view  that many members have been involved in RTA 
negotiations with the general belief that duty elimi nation needs to cover at least 90% of the trade 
between the parties and that no exclusion of a major sect or is allowed, if the RTA is to be consistent 
with the mentioned provision.  WT/TPR/M/211/Add.1 
Page 236  
 
  Under the EPAs which Japan has alre ady concluded, tariffs are eliminated at the time of entry into 
force for most goods, and tariffs on the goods which account for at least 90% of the trade value 
between parties are set to be eliminated within 10 years.  In addition, there is no exclusion of any 
major sector.   
In this way, Japan's EPAs are consis tent with Article XXIV of the GATT. 
 On this basis, Japan introduces, if neces sary, tariff rate quotas under an EPA. 
 
Q.2 Could Japan please elaborate the "positive lis t" system for specifications and standard 
maintained under SPS controls? 
 
A. Japan's positive list system fo r the regulation of agricultural chemicals (pesticides, veterinary 
drugs including hormones, and feed additives) has been introduced fo r the protection of consumer 
health, and is based on scientific and technical consid erations.  This Regulatio n is equally applied to 
all food items, without distinction be tween domestic and imported products.  
 Maximum residue limits (MRLs) established in the process of implementing the system are based on 
Codex standards and other legitimate internati onal standards.  At each stage during the 
consideration process for MRLs, Japan published dra ft documents and sought comments from inside 
and outside the country.  Japan also notified the MRLs  to the WTO in accordance with the WTO/SPS 
Agreement.  Through this procedure, Japan explained  the system in detail to foreign countries before 
and after implementation of the regulation.   MHLW Japan provides positive list system information on the web page below: 
http://www.mhlw.go.jp/english/topics/fo odsafety/positivelist060228/index.html 
 
 
UNITED STATES OF AMERICA
 
 
Q1-1. What additional steps, beyond those alread y being implemented, is Japan prepared to 
undertake to revitalize its structural reform agenda? 
 
A. Japan intends to achieve economic growth thr ough reforms.  The government will specify the 
measures of the following agenda and formulat e an "Economic and Fiscal Reform 2009" policy, 
through discussion in the CEFP (Council on Econom ic and Fiscal Policy) over the next several 
months. 
 1) Social security and employment: promoting new strategies. 2) Economic growth policy:  drawi ng up a scenario for future growth 
3) Tax and fiscal policy:  the specific issue of  the thorough reform of the tax system, and the 
FY2010 budget 
4) Agricultural reform: the framework of a thorough reform of agricultural policy.  
Q1-2. Inasmuch as Japan has identified three pr iority sectors for reform – namely, agriculture, 
medical and nursing services, and air transport – what major reform measures is Japan considering in the near - to – medium – term regarding each of these sectors? 
 
A. For the agriculture sector, various measures have been mentioned in the latest report of the 
Council for the Promotion of Regulatory Reform (C PRR), which was submitted to the Prime Minister 
in December 2008.  The report stated, there are me asures such as a reconsideration of barriers of 
which restricts corporate entry into the farming.  
  WT/TPR/M/211/Add.1 
 Page 237 
 
 
  For the medical and nursing services sector, further advancement of medical services is expected by, 
inter alia, utilizing information technology.  Th e report proposes that a detailed report of medical 
charges should be created that utilizes information technology, this will be done through such things 
as, for instance, creating unified codes for diseases.  
For the air transport sector, in order to strengthe n Japan's international competitiveness, various 
measures have been proposed in the rep ort, such as the further internationalization of Haneda airport 
and disclosure of each airport's financial accounts. 
 
Q2-1. When does Japan intend to correct inequiti es in customs treatment given to Japan Post 
Service (beyond planned February 2009 changes for postal items exceeding 200,000 yen) compared 
to private international express carriers which offe r a similar international express service to EMS? 
 
A. With regard to customs clearance, J apan considers it appropriate to apply different 
procedures to international postal items including EMS items from those app lied to general cargos 
that mainly comprise goods for commercial use, sin ce the majority of international postal items 
including EMS items are small-lot goods for pers onal use unilaterally dispatched by senders.  
 Also referring to similar treatment in other c ountries, Japan has recently revised the related customs 
laws and regulations (the new system  started on 16 February 2009), so as to, in principle, apply the 
duty declaration system, to international postal items including EMS items whose value exceeds 
200,000 yen. 
 Japan understands that this method of setting the criteria for applying the duty declaration system 
based on a specific value, instead of on a specific  type of service, is generally adopted in other 
countries. 
 
Since the revised rules have just b een implemented, for the time bei ng, sound establishment of the new 
rules is of utmost importance. 
 
Q2-2. Will Japan require that Japan Post Servi ce make accounting disclosures sufficiently detailed 
so that third parties can determine whether subsid ization of Japan Post Service's competitive services 
by revenue from its non-competitive services is taking place? 
 
A. Article 11 of the Japan Post Service Com pany Law draws a distinction between businesses 
defined by the Postal Law and other businesses an d mandates the disclosure of each revenue and 
expenditure.  The existing law does not require accounting disclosure which separates EMS from 
other postal services defined by the Postal Law.  
EMS is a part of the postal services stipulated in  the Universal Postal Convention.  In Japan, 
according to the Postal Law, EMS is considered a part of the postal services which are subject to 
universal service.  Therefore, Japan considers that the concept of cross-subsidization between EMS 
and other postal services does not apply. 
 
Q2-3. If there are no plans to correct inequities in  the treatment of international express services, 
what is Japan's justification in light of:  (1) Article  2 of the Japan Post privatization law that calls for 
"equivalent conditions of competition" between Japan  Post companies and private firms;  and (2) 
given that Japan Post Service's domestic express se rvices were put on a level playing field with 
domestic express carriers? 
 
A. Article 2 of the Japan Post privatization law requires equivalent conditions of competition 
between Japan Post companies and other private fir ms which provide similar services and products. 
Japan has been advancing postal privatiza tion processes based on this concept. WT/TPR/M/211/Add.1 
Page 238  
 
  In general, when Japan assesses a market circum stance, it is necessary to  identify a market where 
there are similar services and products that are competing with each oth er.  If it is identified, then 
Japan has to investigate the conditions of business deployment for each firm in order to judge 
whether there is inequality among them. 
 At the moment, there is no data which illustrates and confirms the fact that the international postal 
services (including EMS) and commercial courier service s are competing in the same market.  While 
EMS is a universal service under Japan's Postal La w and Japan understands that the user category of 
each service is different, Japan does not believe they provide the same services in the same market as 
of this moment.  
 
Q3. The Secretariat notes Japan's progress toward increasing transparency of trade practices and 
regulatory measures.  Yet paragraph 15 (page 20) high lights continuing lapses, such as with respect to 
publicizing failures to publish cabinet decisions.  Othe r lapses not identified in the Secretariat's report 
include (1) some Japanese ministries and agenci es enforce regulations according to their own 
generally applicable interpretations  of regulations that are not made public in advance, and (2) there 
continue to be numerous cases where ministries/ agencies convene advisory groups to make 
recommendations on regulatory changes where meaningful opportunities are not provided to all 
interested stakeholders to express views before final decisions are made.  Will Japan commit to 
strengthen its requirements in these  two areas to improve transparency further in order to improve 
Japan's overall environment for business and FDI?  When will Japan require all ministries and 
agencies to publish Cabinet decisions and "understandings"?  A. Advisory groups are administered by relevant  ministries and agencies in accordance with the 
respective laws and regulations concerning their establishment, and the Cabinet Decision, "Basic Plan for the Rationalization of Councils, etc." (April 1999) and other guidelines and regulations.  In accordance with these laws and regulations, th ese groups, if necessary, have opportunities to hear 
opinions from interested parties. 
 
Relevant cabinet decisions and understandings are made  public on each Ministry's website and in the 
publications.  However, as of right now, there is  no need and plan to require ministries and agencies 
to publish cabinet decisions and understandings.  Relevant cabinet decisions and understandings a re made public on th e website and in the 
publications.  However, as of now, there is no need and schedule in the future to require all ministries 
and agencies to publish cabine t decisions and understandings. 
 
Q4. The Secretariat reports that "Japanese Cu stoms applies preferential tariffs based upon a 
bilateral FTA, or the AJCEP, depending upon the cer tificate of origin of the item concerned, thus 
adding to the complexity of Japan's rules of origin ."  Which preferential tariff applies in cases where 
Japan has a bilateral FTA with another signatory of the AJCEP?  Which rules apply?  Those contained 
in the bilateral FTA or in the AJCEP?  How does the government use the certificate of origin to 
determine which preferential tariff applies?  A.  The AJCEP Agreement and the individual bila teral EPAs are completely separate agreements 
with no order of priority as lega lly binding documents.  The rules of origin applied for certain goods 
depend on which agreement each user chooses to use when exporting. 
 
Q5-1. Why does Japan believe that elimination of tariffs would not lead to significant trade expansion?  Why, if more tariffs were eliminated, would there not be significant trade expansion?  If 
there is no bilateral trade in these products to begin with, why not eliminate the duties? 
  WT/TPR/M/211/Add.1 
 Page 239 
 
 
  A. Japan believes, in principle, that the elimina tion of tariffs will lead to  trade expansion.  As 
indicated in the Report, since the JSEPA eliminated tariffs on over 98% of the total value of bilateral 
trade (based on 2005 data), it can be  said that the current JSEPA eliminates tariffs on substantially 
all the trade between the two countries.  On the other hand, duties on certain tariff lines are maintained through a consideration of the EPA's possible impact on certain domestic industries. 
 
Q5-2 Why did Japan choose to eliminate tariffs on such a limited number of agricultural tariff 
lines?  
A. Japan took into account the following facto rs in deciding which agricultural tariff lines to 
eliminate under the JSEPA:  First of all, the JSEPA  should be consistent with the WTO Agreement. 
Thus, the JSEPA should meet the requirements for a free trade agreement as set out in Article 24 of 
GATT, i.e. the elimination of tariffs on substantia lly all the trade. However, certain tariff lines were 
excluded from elimination, given the possible impac ts on the agricultural industry they may cause. 
 Q6. These paragraphs indicate that Japan's EPAs with Malaysia, Thailand, Indonesia and Brunei 
cover a high percentage of bilateral trade, but do not outline the percentages of tariff lines covered.  
We assume that Japan eliminated tariffs on a high percentage of industrial tariff lines under each of these EPAs.  What percentage of its agricultural tariff lines are eliminated under each of these EPAs? 
 
A. The Government of Japan is of the view t hat many members have b een involved in RTA 
negotiations under the general assumption that duty e limination needs to cover at least 90% of trade 
between the parties and that no exclusion of a major s ector is allowed in for a RTA to be considered 
consistent with GATT Ar ticle XXIV paragraph 8. 
 Under the EPAs which Japan has already concluded, ta riffs are to be eliminated within 10 years for 
goods which account for at least 90% of  all trade value between parties.  
 Percentages of tariff elimination by sectors in terms of tariff lines under Japan's EPAs are not 
available.  The schedules for the four EPAs are available on the following website:  http://www.mofa.go.jp/policy/economy/fta/index.html. 
 Q7-1. Does Japan foresee a resumption of negotiations with Korea in 2009? 
 
A. At a bilateral summit meeting in Oct ober 2003, Japan and Korea agreed to launch 
negotiations for a Japan - Korea Economic Partners hip Agreement (EPA).  Six rounds of negotiations 
were held between December 2003 and November 2004 , when negotiations were suspended.  At a 
summit meeting in April 2008, the leaders of th e two countries reconfirmed the importance of the 
bilateral EPA and agreed to hold working level consultations in June for the resumption of 
negotiations.  The leaders of the two countries al so agreed to further advance joint consideration 
towards Japan – Korea EPA negotiations at a bilateral summit meeting in January 2009.    
Japan considers the conclusion of the Japan – Kore a EPA as important not only for strengthening 
bilateral relationship but also for prom oting economic partnerships in East Asia. 
 Japan and Korea held working-level consultation mee tings in June and December 2008.  Japan hopes 
that the consultation meetings will lead to  an early resumption of the negotiations. 
 
Q7-2. Does Japan foresee active negotiations with Viet Nam, India, Australia and Switzerland in 2009?  WT/TPR/M/211/Add.1 
Page 240  
 
  A. Yes. With India and Australia, Japan will con tinue to be actively e ngaged in negotiations in 
2009.  Japan has already signed an EPA with Vi et Nam in December 2008 and intends to sign an 
EPA/FTA with Switzerland in February 2009. 
 
Q8. In light of Japan's low per centage of foreign investment co mpared to other OECD economies, 
will Japan follow the Expert Committee's recommenda tions in order to facilitate further cross-border 
merger and acquisition (M&A) activities into Jap an? If so, what specific measures will Japan 
undertake?   A. Following the Expert Committee's recomme ndations, Japan published a report entitled 
"Takeover Defense Measures in Light of Recent En vironmental Changes" created by the Corporate 
Value Study Group in June 2008.  Japan also revise d the "Program for the Acceleration of Foreign 
Direct Investment in Japan" in December 2008 for the promotion of M&A. Japan will continue to 
implement measures through periodical follow-ups to the program.  
Q9-1. Are the designated cities ( shitei toshi ) that are not covered by the WTO Agreement on 
Government Procurement (GPA) re quired to apply the same laws, ordinances and other measures in 
their conduct of procurement as the 12 designated cities that are covered by the GPA?  
A. All of the designated cities, regardless of wh ether they are covered by the GPA or not, are 
supposed to comply with the same laws, or dinances and other measures for procurements. 
 
Q9-2. What is the percentage and number of IAA that have been created since the 2001 reorganization that are covered by the GPA?  
A. As of 1 October 2008, 86 (86%) of 100 IAAs are covered by the GPA. 
 
Q9-3. Are the IAA that are covered by the GPA a llowed to apply their own procurement procedure?  
If so, how does the Government of Japan en sure that they comply with the GPA? 
 
A. The IAAs covered by the GPA apply their own service manual, whic h includes procurement 
procedures.  The "Act on General Rules for Incorporated Administ rative Agency" (Act No.103 of 
1999) provides for ministerial approval of the service  manual.  The compliance of the IAAs with the 
GPA is ensured throug h this approval by the responsible ministers. 
 
Q9-4. The process of creating IAA is unclear.  What  criteria does Japan use to determine if a new 
entity will be covered by GPA? 
 
A. In the past, Japan added into Annex 3 mo re than 50 IAAs.  These IAAs were created to 
perform undertakings that had been operated by th e central government entities covered by the GPA.  
Similar consideration would be given when a new IAA is created. 
 
Q9-5. The United States has continuing concerns with the excessive use by  Japanese entities of the 
exception in GPA Appendix I, Annex 2, Note 5 and Annex 3, Note 4(a) (" procurement related to 
operational safety of transportation").  For each  Annex, please provide the number and value of 
procurements in which this exception was used from 2004 through 2008.  
A. (1) In regard to procurement over the threshold of the GPA, the entities in Japan's Annex 2 used 
Note 5 of the Annex from 2004 through 2006 as follows.   WT/TPR/M/211/Add.1 
 Page 241 
 
 
  Year Number Value (100 million yen) 
2004 183 244 
2005 221 273 
2006 150 200 
 
(2) There is no statistical data available on the application of the Note  as regards entities in 
Japan's Annex 3.  However, in order to assu re proper application, the Ministry of Land, 
Infrastructure, Transport and Tour ism (MLIT) is, as appropriate, requesting the procuring entities 
(incorporated administrative agencies and special companies) listed in Annex 3 to apply the Note 
strictly, and to refer to the MLIT in advance when qu estions arise in deciding on the applications of 
the Note. 
 
Q10. Page 43, paragraph 40 of Secretariat's repor t describes Japan's notifications of organizational 
changes in procuring entities subject to the GPA,  since 2006.  In addition to the notifications 
described, one of the notifications that has been pending since 2003 is Japan's proposed withdrawal of 
the National Aerospace Laboratory (NAL).  This notification is awaiting Japan's responses to 
questions from the United States and other GPA Part ies.  Are the entities that assumed the functions 
of the NAL conducting their procurements in acc ordance with the GPA?  Please describe the 
procurements that have been conducted by su ch successor entities, the names of the entities 
conducting the procurements, and the proc urement procedures that were used. 
 
A. The NAL has been abolished and the Japan Aerospace Exploration Agency ("JAXA") has 
been established. The Activities of JAXA include those previously undertaken by the NAL. Change 
that would be brought about by th e withdrawal of the NAL in the level of mutually agreed coverage 
under the GPA, if any, is negligibly-small. 
 
Q11. Please describe the "competitive bidding methods" that were adopted.    
A. That is open tendering, as stipulated in the Accounts Law. 
 Q12. Is the "third-party body" independent of th e entity that it monitors?  If so, please describe how 
it is independent.   
A. Yes.  The following are examples of the way it is independent:  
 1) Each procurement organization must est ablish guidelines regarding the formation and 
operation of the third-party body. Also, the gui delines have to be disclosed to the public. 
2) The members of the third-party body have to  be persons, such as scholars, lawyers or 
accountants, who are qualified to objectively revi ew the contracts in a fair and neutral way. 
 
Q13. What is the scope and type of monito ring conducted by the monitoring bodies?   
 
Do these bodies issue reports?  If so, are the reports made public?  Is information obtained by the Ministry of Internal Affairs and Communications’ m onitoring system made available to the public?  
Where problems are identified in monitoring, what  types of corrective actions may be required? 
 
A. The Ministry of International Affairs and Communications (MIC) executed an investigation, 
"Administrative Evaluation and Inspection Concerni ng Appropriate Execution of Contracts" for all 
offices and ministries from January 2008, and finished the investigation on December 16 of the same 
year.  The full text of the report on the investigation is available on the MIC homepage. 
 WT/TPR/M/211/Add.1 
Page 242  
 
  As a result of this investigation, some problems b ecame clear.  For example, the private contracts 
were identified that needed to be shifted to co mpetition contracts.  There were also instances of 
contracts being awarded under lim ited conditions in which there was only one bidder.  Based on this 
result, Minister for Internal Affairs and Communications recommended that the ministers of each office and ministry improve the situation.  
 
This investigation is not executed regularly.  Please refer to the following URL for the text of the report. http://www.soumu.go.jp/hyouka/hyouk a_kansi_n/ketsuka_nendo_20.html 
 
Q14-1. What type of "review" of single te ndering contracts was undertaken by the central 
government entities?  Did the review extend to th e use of single tendering contracts by public 
corporations? 
A. In that review, all contracts made by each mi nistry, in principle, were assumed to shift to the 
open tendering, excluding when single tendering is n ecessarily unavoidable.  The use of the term 
"public corporations" is not clear, but the review did extend to Independent Administrative Institutions. 
 
Q14-2. Please describe the "opening tendering" that was adopted.    A. That is open tendering, as stipulated in the Accounts Law. 
 
Q14-3. "All central government agencies reviewed  single tendering contracts and have increasingly 
been introducing open tendering." 
 
c) Please describe any pre-qualification requireme nts and registration requirements that apply to 
participation in procurements  conducted under open tendering. 
 
A. The "unified qualification for participating in tendering contracts for manufacturing and 
sales of products" was introduced in 2001 for th e purpose of lessening the burden of enterprises 
through the simplification and streamlining of offic e work, qualifications were previously decided 
individually by each ministry or agency.  The de tailed contents of the qua lification are made public on 
the following website:  http://www.chotatujoho.go .jp/va/com/KOUJI.html.  Only available in 
Japanese. 
 
Q15. "Procurement under the basic guidelines must be ¥500 million or less per contract; any 
planned procurement exceeding this threshold must be separated or divided."  How does the 
Government of Japan ensure that the separation or division of procurements in accordance with this 
provision is consistent with GPA Article II:3?  
A. The provision about separated/divided proc urement in the basic guidelines is aimed at 
ensuring fair competition and the transparency of  information procurement, by conducting 
separated/divided procurement for information system with designing and development costs of 
¥500 million or more.  Japan does not consider the prov ision for separated/divided procurement to be 
against GPA Article II:3.  Japan does not assume that  procurement for the development of large-scale 
information systems costing ¥500 million or more is  separated or divided into some units under 
GPA's threshold to avoide application of the GPA. 
 
Q16-1. (1) Please describe the procedures used in  "open tendering."  (2) What measures is the 
Government of Japan taking to reduce the use of single tendering?   WT/TPR/M/211/Add.1 
 Page 243 
 
 
  A. (1) Sealed tenders must be submitted to the d esignated place before the deadline, all of which 
is specified by a notice in the official gazette Kanpo, or in its equivalents at the local level.  Tenders 
may be submitted in person, by proxy, or by mail, provided that the submission be completed before 
the deadline for receipt of tenders.  Tenders, onc e submitted, must not be replaced, modified or 
canceled. Tenders can be submitted by Internet to so me procuring entities.  (2) Ministries reviewed 
the use of single tendering contracts, and follow up on that review every year. 
 
Q16-2. Suppliers that attempt to participate in Ja pan's government procurement market often cite the 
difficulty of participation in Japan due to lack of transparency, bid-rigging, the business evaluation 
system, pre-qualification requirements, and other barri ers.  What actions is the Government of Japan 
taking to reduce the barriers that prevent or disc ourage participation by foreign suppliers in its 
government procurement?  
A. Japan has no rules or regulations that  discriminate against foreign suppliers, goods, or 
services in government procurement covered by the G PA.  As a matter of fact, the Government of 
Japan has been making efforts to ensure non-discri minatory, transparent, and fair procurement 
procedures by implementing additional measures bey ond the obligations of the GPA.  For example, 
under the Action Program on Government Procuremen t, to facilitate the participation of foreign 
suppliers, the 40-day tendering period of the GPA was extended to 50 days for entities in Annexes 1 
and 3 of the GPA attempting to procure contra cts for goods and services (excluding construction 
work, architectural, engineering and other technical s ervices).  The government of Japan continues to 
make efforts on this issue.  
Q16-3. States that "Firms that ha ve central government-wide unified qualification for participating in 
tendering contracts for manufacturing and sales of products total 59,629 (as of 10 March 2008);  
386 of these firms have capital wholly or partially ow ned by foreigners."  Please describe the "unified 
qualification for participating in  tendering contracts for manufacturing and sales of products."  Do 
these qualification requirements appl y when open tendering is used? 
 
A. In regard to "unified qualific ation for participating in tendering contracts for manufacturing and 
sales of products," please refer to the answer to the question "Page 44, Note 25 states C". 
 
The unified qualifications are applied to open  tendering and designated bidding for the 
manufacturing and sale of products. 
 
Q17-1. With regard to increased conformity with international prac tices and guidelines on BSE 
established by the World Organization for Animal H ealth (OIE), please describe Japan's achievements 
since its 2007 TPR and any additional actions it w ill take to further enha nce harmonization with 
international practices and guidelines.  
A. Regarding BSE, Japan has taken measures ba sed on the risk assessmen t undertaken by the 
Food Safety Commission (FSC).  Any lifting of import  bans or review of th e import requirement on 
beef is also examined based on risk assessment by the FSC. 
 
Japan has been discussing bilaterally with the countries about lifting the import bans or reviewing of 
the import requirement. 
 
Regarding the issue with the U.S., since the 2007 TPR, the verification period to evaluate compliance 
with the Bovine Exporting Verification (BEV) program  carried out by U.S. establishments has been 
terminated and the U.S. and Japan have reached a shared understanding on U.S. compliance with such requirements.  In response to the U.S. request on discussing beef import requirements in light to WT/TPR/M/211/Add.1 
Page 244  
 
  the U.S.  BSE risk status recognized as "controlled," both governments held a technical working 
group in the summer of 2007.  Japan will continue  to work with the U.S. towards science-based 
solutions for this issue. 
 
Q17-2. With regard to confor mity with international practi ces and guidelines on avian influenza 
established by the OIE, please describe Japan's achievements since its 2007 TPR and any additional 
actions Japan will take to enhance further harmoni zation with international practices and guidelines, 
particularly with regard to low pathogenic avian influenza (LPAI).  
A. With regard to imports of poultry and poultry meat from the United States, for cases of LPAI, 
Japan has been applying regionalisation, defining a state as the minimum unit since 2002.  Japan has 
not amended any regulation or requirem ent on this issue since the 2007 TPR.  
 Japan continues to work with the U.S. toward s science-based solutions.  Both governments hold 
active discussions on technical matters in cluding avian influenza as needed. 
Q17-3. With regard to conformity with intern ational practices and guide lines on organic production 
established by CODEX, please explain how Japan's zer o tolerance policy for transgenic organisms in 
organic products complies with CODEX Guidelines for organic production which clearly states:  "Organic agricultural practices cannot ensure that products are completely free of residues, due to 
general environmental pollution.  However, methods are used to minimize pollution of air, soil and 
water."  Please explain if and how domestic organic pr oducts in Japan are tested at the same level as 
imported organic products. 
 
A. The Japanese Agricultural Standard for Or ganic Plants prohibits using seeds, seedlings, 
manure, fertilizer or other agricultural materials m odified using DNA technology.  It is consistent 
with the Codex organic guideline. 
 
The PCR (Polymerase Chain Reaction) method has been used as the analytical method for both 
domestic and imported JA S-organic products.  
 
Q18-1. Japan's maximum residue level (MRL) enfo rcement policy penalizes an entire industry in an 
exporting country due to a violation incurred by a single supplier from that country in cases where 
MRL tolerances established in the exporting country are less restrictive than Japan's MRLs.  How 
does this policy comply with Articles II and V of the Agreement on the Application of Sanitary and 
Phytosanitary (SPS) Measures?  What scientific ev idence is available to Jap an to warrant such a 
stringent enforcement policy on imported products?  Are all domestic products similarly subject to 
30% test and hold policies after a single violation within Japan? 
 
A. Equivalence measures are provided for in  Article 4 paragraph 1 of the Agreement on 
Sanitary and Phytosanitary (SPS) Measures.  The conferment of equal recognition is held in 
paragraph 2 of this Article.  An "Appopriate Oppor tunity" as described in Article 4 paragraph 1 of 
the SPS Measures, is given at the time of import.  Fu rthermore, "conferment" is carried out from start 
to finish indicated in paragraph 2 of the same article. 
 
Domestic products are inspected by each local go vernment in accordance with a plan of inspection 
and guidance which is based on Article 24 of the Food Sanitation Law of Japan. Regarding domestic 
violations, Japan does not apply the same inspection systems as for import food.  Control measures 
follow Japan's MRL policy and laws.  Local go vernments investigate the cause of every individual 
violation and take corrective actions immediately.  
Q18-2. Japan provides the general public with a list of all violations of its MRL policy by exporting 
countries on the Internet.  Please identify where Japan publicizes similar violations of the MRL policy  WT/TPR/M/211/Add.1 
 Page 245 
 
 
  by domestic suppliers.  If Japan does not publicize domestic violations, how does it ensure that its 
enforcement measures do not arbitrarily or unj ustifiably discriminate between Members where 
identical or similar conditions prevail in acco rd with Article II of the WTO SPS Agreement? 
 
A. Domestic products are inspected by local go vernments.  For cases of domestic violation, each 
local government, in accordance with Article 63 of Food Sanitation Law, officially announce the 
names of the violators on the internet.  For furhter information on violations , please refer to the following URL. 
http://www.mhlw.go.jp/topics/bukyoku/iy aku/syoku-anzen/kaisyu/index.html 
 
Q19. The Secretariat's report reviews Japan's ne w or Modified SPS measures.  Please explain how 
Japan's current post-harvest fungici de policy, which classifies post-harv est fungicides as a pesticide as 
well as a food additives and thus requires a second risk assessment to be conducted, complies with 
WTO requirements, as outlined in Article V of th e WTO SPS Agreement.  According to Article V, 
SPS measures should not be more trade restrictive than  required to achieve thei r appropriate level of 
SPS protection.  
A. The Food Sanitation Law defines food additives as: 
 1) substances used in or on food during the manufacturing process 
2) substances used for the purpose of processing or preserving food. 
 Even if a compound is used for the prevention of tain t or deterioration by mold or other microbes 
after harvesting, it is classified as a food additi ve according to the definition above.  Therefore, 
post-harvest fungicide is classified as a food additive. 
 
The Ministry of Health, Labour and Welfare is in charge of setting MRLs, which are based on the 
results of risk assessment undertaken by the Food Safety Commission independently.  
 
Q20. Japan's Food Sanitation Law appears to pr ovide broad latitude for regulatory agencies, 
specifically the Ministry of Health, Labor & Welfare (MHLW), to extend "exemption" status 
authorization to recognized organizations.  Does the Food Sanitation Law cover products that are 
inspected by MHLW?  Specifically, are there any foods for which inspection must be conducted by 
MHLW and if so, what is the basis for this policy?  
A. The Quarantine Stations of the MHLW inspect imported food in accordance with the Food 
Sanitation Law.  Under Article 26 of the Law, when  the Minister of the Health, Labour and Welfare 
deems it necessary, in order to prevent any food sanitation hazards , the Minister may order importers 
to receive inspections at each import to confir m that their products comply with the Law. 
 
Q21. What is the scientific basis upon which th e Food Sanitation Law provides for the labeling of 
abalone, squid, salmon roe, oranges, kiwifruit, beef , mackerel, salmon, gelatin, chicken, port, peaches, 
yams, and apples as allergenic substances?  A. The Ministry of Health, Labour and Welfare in Japan is now carrying out studies to elucidate 
the actual circumstances of food allergies and potential allergens under its Immunity & Allergy 
Research Program.  Based on the results of studi es up to this point, in which there were cases 
reported of drops in blood pressure, respiratory di stress, loss of consciousness, and so forth, the 
Ministry has designated "Specified ingredients" as  ingredients containing a llergens clearly identified 
within foods consumed by such patients concerned at the time of distress.  Specified ingredients so far 
designated include 25 items:  shrimp/prawn, crab, wheat, buckwheat, eggs, peanuts, abalone, squid, WT/TPR/M/211/Add.1 
Page 246  
 
  salmon roe, oranges, kiwifruit, beef, tree nuts,  salmon, mackerel, soybeans, chicken, bananas, pork, 
"Matsutake" mushrooms, peaches, yams, apples and gelatine.    It is important that information be provided so that allergic pat ients can make informed choices of 
what food does or does not contain allergens to which he/she may react.  When publishing 
information concerning specified ingredients in foods and setting standards for "Ingredient labeling 
for foods containing allergens," due to the fact that  the severity and frequency of  allergic cases differ, 
such ingredients are separated into two categori es.  One is "mandatory labeling" by ministerial 
ordinance, and the other is "labeling recommended" by notice.   
The former category, designated mandatory by ministerial ordinan ce consisted of the seven items: 
shrimp/prawn, crab, wheat, buckwheat, eggs, milk and peanuts.  The latter listed 18 items:  abalone, 
squid, salmon roe, shrimp/pra wn, oranges, crab, kiwifruit, beef, tree nuts, salmon, mackerel, 
soybeans, chicken, bananas, pork, "Matsutake" mush rooms, peaches, yams, apples and gelatine are 
recommended for labeling by notice. 
 
Q22. Was the Agricultural Products Inspection La w which required mandatory inspections of rice, 
wheat, barley, and soybeans notified to WTO?  Si nce this law regulates the mandatory labeling of 
transgenic foods under the Food Sanitation Law, how did Japan take into consideration other 
countries' comments in developing this regulation?  A. The agricultural Products Inspection Law does not have any provisions regulating the 
labeling of the transgenic foods covered  by the Food Sanitation Law.  
 
Q23. The Secretariat's report describes a significan t increase of small-lot shipments involving IPR 
infringement.  Given growth in the number of incidences involving IPR infringement, is Japan 
considering additional tools to assist in the pro secution of IPR-related crimes such as by granting 
ex officio  authority to prosecute these types of crimes? 
 
A. The import or export of goods infringing inte llectual property rights is a violation of the 
Customs law.  Japan Customs has the authority to send such cases of Customs law violation to 
prosecutors without a complaint from the right holders.   In order to prevent the import of infringing 
goods by small-lots shipment, Japan Custom s utilizes a database and checks the past records of 
importers.  Additionally, under the Patent, Utility Model, Desi gn, and Trademark Acts, ex officio authority is 
granted for prosecution:  the Patent Act (Article  196), the Utility Model Act(Article 56), the Design 
Act (Article 69) and the Trademark Act (Article 78) do not require a complaint from the right holder 
for prosecution. 
 
Q24. The Secretariat's report states that th e 2006 amendment to the Antimonopoly Act, among 
other changes, "expedited JFTC's hearing procedures. "  In light of business community concerns that 
those changes to the hearing procedures resulted in  inadequate procedural fairness for respondents, 
what measures, if any, does Japan intend to take  to ensure that respondents in JFTC hearing 
proceedings are afforded due process protections that  are in line with international best practices? 
 
A. The 2006 amendment of the Antimonopoly Act r eviewed hearing procedures and as a result, 
abolished the recommendation system and provided a person to be the addressee of the said case an 
opportunity to express any his or her opinions and to  submit evidence before the issuing of a cease 
and desist order and a surcharge payme nt order by the JFTC.  Also, it enabled those dissatisfied with 
JFTC orders to request that the JFTC initiate a hear ing.  In this manner, the hearing procedure does 
not treat respondents unjustly.  Even before the amendment in 2006, the JFTC ensured the due 
process of hearing procedure, by, for exa mple, securing defense rights for respondents.  WT/TPR/M/211/Add.1 
 Page 247 
 
 
  Q25. The Government of Japan has announced a po licy of reducing imports in order to meet food 
self-sufficiency goals.  Will this government-led effo rt result in border protection beyond what is in 
Japan's country schedule?  How does the Government of Japan plan to implement policies that reduce 
imports without nullifying or impairing market access currently enjo yed by WTO Members? 
 
A. To attain the target rate of food self-sufficiency, 
(1) on the consumption side, Japan carries out a nationwide campaign on plain and practical 
"food education".  The campaign include the  promotion of a "Balanced diet guide" to reduce 
left-over food and, 
(2) on the production side, Japan encourages production to meet consumers' needs by 
strengthening ties between th e food industry and farmers and by supporting core farmers who 
possess a better sense of business management. 
 
Such efforts do not undermine our schedul ed commitments in border protection. 
 Q26. Why are fill rates for tariff quotas for many m ilk products much lower than the fill rates for 
other products such as grains?  Specifically, quota fill rates for many milk products are below 50%, 
while fill rates for grains are near 100%.  How does Japan account for this wide difference?  Is it a 
consequence of the in-quota tariff rates being too high?  Is there another reason?  Please explain. 
 A. Japan considers the tariff quota filling rate of  a product to accurately reflect the balance 
between the products quota size and the actual dema nd for import products in the domestic market.  
 
Q27-1. The Secretariat's report states that inform ation on subsidies on rice was not provided to the 
Secretariat.  Additionally, the specific duty is collect ed by Customs on behalf of Japan's State Trading 
Enterprise (MAFF) and placed into "special ac counts related to agriculture in the Central 
Government."  Please provide data on the amount of subsidies provided for rice.  Additionally, please provide 
information on the special accounts where specific duties are placed, including the use of the funds 
placed into the special accounts. 
 
A. The amount and type of domes tic support for rice in 2006 was 70.1 billion yen as a Blue Box 
programme and 2.3 billion yen in the de minimis support.  For further details, please refer to the notification (G/AG/N/JPN/137). 
 
The levy for rice collected at local agricultural administration offices is placed in the special account 
of the government and spent on work towards the ac hievement of various objectives, including the 
government purchase of domestic and imported rice. 
 
Q27-2. For Japan fiscal year 2007, Japan failed to  meet its full in-quota tariff rate quota (TRQ) 
quantity for rice.  The unusual conditio ns in 2007/2008 that contributed to global rice prices that were 
higher than normal, although still below Japan's do mestic prices, exposed several weaknesses in 
Japan’s administration of its TRQ system for rice.  Is Japan reconsidering whether its import system 
for rice is necessary?  If Japan pl ans to continue operating a rice state trading enterprise, will the 
government guarantee that future mini mum access commitments will be met? 
 
A. There is no plan to abolish the current import syst em for rice.  Japan will continue to work 
for the fulfillment of its WTO obligations. 
 
Q28. The Secretariat's report states that Japan r eserves the right to implement "emergency tariff 
measures for import surges of beef and pork, in  accordance with the Temporary Customs Tariff WT/TPR/M/211/Add.1 
Page 248  
 
  Measures Law."  What is the current status of this measure?  If Japan intends to retain this measure in 
the upcoming fiscal year, how would it be implemented?  
 
A. Temporary tariff laws are reviewed and ext ended annually.  In regar d to Emergency tariff 
measures for beef and pork, the Council on Customs, Tariff, Foreign Exchange and other 
Transactions submitted a report last December to the Finance Minister, recommending the 
application of same measures for FY2009 as applied in  FY2008.  Following the report, related bills 
were been submitted to the Diet. 
 
Q29. Please provide information on what types of  tax reductions are provided to manufacturers 
under the Law on Special Measures for the Revitalization of Industrial Dynamism? 
 
A. Japan extends accreditation to companies appl ying under one of six types of business 
revitalization plans.  These types are A plan (Self- Restructuring Plan), B plan (Business Transfer & 
Restart Plan), C plan (Co-Restructuring Plan), D plan (Pilot Investment Plan,). E plan (Technical 
Innovation Plan) and F plan (Managerial Resources Integration Plan.)  Companies can implement 
D plan and another of the 5 plans at the same tim e.  Japan provides following four tax reductions to 
accredited applicants under the Industrial Rev. Law:  (1) A deduction of registration and license taxes 
to the accredited applicants of A, B, C, E, F.  (2) 20% or 30 % accelerated depreciation to the 
accredited applicants of all plans.  (3) The accredited applicants of A, B, C may treat depreciation in 
property value as a loss.  (4) A deduction of rea l property acquisition tax to the accredited applicants 
of A, B, C, E, F.  
Q30. The Secretariat Report notes that Japan "intends assist [sic.] the development of manufacturing, including the aircraft industry (e.g. the Mitsubishi Rear Jet project)."  Please outline the measures Japan intends to undert ake to assist its manufacturing i ndustry, including the aircraft 
industry. 
 
A. Japan's policies for the development of the manufacturing industry, including those towards 
the Mitsubishi Regional Jet project, are fully co mpatible with its obligations under the WTO 
Agreement. Japan's subsidies related to ai rcrafts can be found in Japan's notification 
(G/SCM/N/155/JPN), pursuant to Article 25 of the Agreement on Subsidies and Countervailing 
Measures.  The most recent status of the subsidies are as follows: 
 - The annual amount budgeted for "Subsidy of Ex pense to Investigate the Development of Next 
Generation Airplanes" is:  - Fiscal year 2006 (final results): ¥165 million; and 
 - Fiscal year 2007 (final results): ¥155 million. 
 - The annual amount budgeted for "Assistance for Development of Civil Aircraft" is:  - Fiscal year 2006 (final results): ¥834 million; and  - Fiscal year 2007 (final results): ¥1,050 million. 
 Q31. The Secretariat's report describes a reform measure to allow banks to sell all insurance 
products over the counter.  Are there currently any plans to liberalize further the bank sales channel 
for insurance products such as through the removal on the limits on sales of first and third sector 
products and treatment of customer data?  A. The Government of Japan has been monitori ng the current measures to prevent the negative 
effects of implementing, in December 2007, flat cance llation of these measures, and in the light of the 
monitoring results, Japan will review the current meas ures in three years from the perspective of both  
policyholder protection and convenience. 
  WT/TPR/M/211/Add.1 
 Page 249 
 
 
  Q32. The Secretariat's report states that Japanese au thorities maintain that there are no state-owned 
insurance companies in Japan.  Please clarify this st atement in light of the f act that the Japan Post 
Insurance Co. Ltd is fully owned by the Japan Post Holding, a fully state-owned holding company?  
A. Japan Post Insurance started its business in October 2007, when Japan Post was privatized. 
Under the Law of the Privatization of Postal Service s, Japan Post Holdings is obliged to dispose of 
all of the shares it holds in Japan Post Insurance no later than 30 September 2017. 
 
Q33. The Secretariat's report states that the cr iteria for granting licenses and the requirement of 
solvency margins are the same for Japanese and fore ign insurance providers.  Please confirm that this 
statement is consistent with the treatment of corp orate transactions by domestic insurers as compared 
to foreign insurers?  Our understanding is that in surers incorporated in Japan have a number of 
options available to them, such as mergers ( shinsetsu gappei ), spin-offs ( kaisha bunkatsu ), policy 
portfolio transfers ( houkatsu iten ), and non-portfolio transfers of the company's business ( jigyou no 
jouto ).  However, the procedures available to forei gn insurance companies are limited only to policy 
portfolio transfers and non-portfolio transfers of the company’s business. 
 
A. In principle, as described in the Trade Policy Review Report by the Secretariat, Japan 
secures that foreign insurance companies are treated equally as domestic companies.  
 Foreign insurance companies are able to conduct in surance business in Japan in two ways, i.e. 
incorporating in Japan and establishi ng sub-branches of native companies. 
 In the case of incorporating in Japan they recei ve the same treatment regardless of whether the 
insurance companies are domestic or foreign.  Therefore, foreign insurance companies can have 
options such as mergers, spin-offs, policy portfo lio transfers, and non-portfolio transfers of the 
company’s business.  However, the provisions on mergers and spin-offs with regard to sub-branches 
are not stipulated in the Corporate Act, wh ich stipulates restructuring and organizational 
restructuring in general, so the Insurance Business Act does not have a special provision on mergers 
and spin-offs as well.  
 
Q34. The Secretariat's report states that the In surance Business Law was amended to establish a 
framework for unregulated insurance cooperatives ( kyosai) that entered into force on 1 April 2008.  
With respect to ministry-regulated kyosai, what are Japan's plans or measures to ensure a level 
playing field is established by bringing these kyosai  regulated by various Japanese ministries under 
the same obligations and supervision as private sector  companies to the extent that they compete with 
private insurance companies regulated  by the Financial Services Agency? 
 
A. The kyosai activities conducted by cooperati ves are based on a system of mutual aid 
associations composed of me mbers circumscribed by region or workplace, which contribute 
premiums and utilize businesses between each other.  The kyosai activities are conducted as a part of 
wide range of reciprocal help activities (joint proj ect, loan, welfare service) of members.  Therefore, 
these activities are of a different nature from those of commercial insurance businesses that target the 
general public.  Thus, it is not a ppropriate to apply the Insurance Business Law to kyosai providers as 
in the case with private insurers.  These kyosai activities are subject to regulatory supervision by the 
competent authorities within the confines of the relevant laws. 
 
Q35. The Secretariat's report states that Japan Po st Insurance provides life  insurance services under 
the same regulations applied to other private in surance companies under th e Insurance Business Act 
and that it faces various constraints including lim its on the insurance amount per policy holder, limits 
on product variety, and investment restrictions during the period from 2007 to 2017.  WT/TPR/M/211/Add.1 
Page 250  
 
  A) As Japan implements postal privatization fro m October 2007 and prior to the full privatization 
of Japan Post Insurance, what procedures are in  place to ensure consistency with its Postal 
Privatization Law principle to establish "equal co mpetitive conditions" between the postal entities and 
"other companies engaged in like business operations"?  
B) What measures or procedures are in place to  ensure that the constraints on Japan Post 
Insurance, including limiting product variety, w ill remain in place until equivalent conditions of 
competition are achieved?  
A. Japan Post Insurance (JPI) is subject to the same laws and regulations, including the 
Insurance Business Law, applied to private insu rance companies.  In addition, the Law of the 
Privatization of Postal Services imposes busin ess restrictions on JPI during the privatization 
transition period.  Under the law, the Prime Minister and the Minister of Internal Affairs and Communications shall approve business expansions if it is determined that there is no risk of 
impairing fair competitive relationships and approp riate provision of service to users, taking into 
consideration circumstances affecting competiti ve relationships and JPI's business conditions. 
 
Q.36 The Secretariat's report paraphrases a government policy of maintaining a one-third equity share in NTT by noting "The authorities maintain  that the Government holds the share for public 
interest and safety reasons."  Please explain what is meant by "public interest and safety" reasons.  Is 
the Government of Japan considering eliminating th is requirement? What would be necessary for it to 
do so? 
 
A. NTT holds all of the shares of NTT East and NTT West, which are key telecommunications 
carriers in Japan.  NTT undertakes a public role  which includes providing universal services, 
promoting R&D and disseminating its results. In add ition, communications for national defense and 
public order, which must be secured in times of emergencies and natural disasters, depend 
significantly on NTT East and NTT West.  In view of these facts, the NTT Law obligates Japan to  hold at least one third of the issued shares of 
the NTT Holding Company to en sure stable operation in order to  prevent any domination of NTT 
management or abuse of shareholder rights by a specific entity. 
 
While Japan has no plan to eliminate this requiremen t, Japan will review the overall structure of NTT 
in FY 2010, and aims to reach conclusions as early as possible. 
 
Q37. The report notes the efforts of the tel ecommunications regulator (MIC) to develop a 
comprehensive program to institute appropriate competition safeguards in the telecommunications 
sector.  However, there is no mention of ongoing discussions regarding (1) a proposed new law regarding the convergence of telecommunications and broadcasting;  and (2) overall structure of NTT, 
including proposals to break up the company into fully independent un its.  Please explain the status of 
these two initiatives, and the rationale for not a ddressing these issues in a comprehensive manner. 
(For example, structural separation is highly relevant to how any competition safeguards are 
implemented, as it is to issues of potential market power exercised by a company owing 
telecommunications infrastructure which may seek to enter the broadcasting sector.)  
 
A. Japan is conducting reforms in telecomm unications and broadcasting fields based on the 
"Process Program for the Reform of the Co mmunications and Broadcasting Field" which was 
compiled in September 2006 as a detailed implem entation plan for the "Agreement between the 
Government and the Ruling Parties on Regulatory Frameworks for Communications and Broadcasting."  This program includes plans for th e development of fair competition rules including 
competition safeguards in the telecommunications se ctor, the establishment of comprehensive legal  WT/TPR/M/211/Add.1 
 Page 251 
 
 
  systems for telecommunications and broadcasting, review s of the overall structure of NTT, and other 
relevant issues.  Thus the reform is being un dertaken steadily in a comprehensive manner. 
 As to (1), based on the Program, Japan is planning to submit a b ill to the ordinary Diet session in 
2010.  Currently, the Committee on the Comprehen sive Legal System for Communications and 
Broadcasting under the Telecommunications Council is  addressing the details of legal systems for the 
convergence of the two fields and compiled th e "Agenda to be Examined concerning the 
Comprehensive Legal System for Communications and Broadc asting" in December 2008.  
 Concerning (2), this is referred to  in the "Agreement between the Government and the Ruling Parties 
on Regulatory Frameworks for Communications and Broadcasting" as well as  in "Economic Fiscal 
Reform 2006."  Japan intends to examine the overall  structure of NTT in 2010 and to conclude the 
discussions swiftly, taking into consideration th e latest relevant policy reforms in the 
telecommunications sector and the results of the annual competition reviews in the telecommunications business field. 
Q38. In footnote 69, the report notes the key in terconnection rates offered by NTT wireline and 
mobile operators as about 2.4 cents a minute and 12 cen ts a minute, respectively.  With respect to the 
wireline rate, this appears significantly above t ypical tandem level rates in OECD countries (a 
comparable U.S. rate is about one-fourth that amount.  European, Mexican and Koreas rates about 
one-half.)  What effort is Japan making to bring th is rate down to internationally-comparable levels? 
With respect to NTT's mobile interconnection rate, does the regulator believe that voluntary efforts by 
NTT to reduce this rate are sufficient, given th e negligible reductions in recent years, and the 
persistently high level the rate remains at?  If, as a ppears to be the case, NTT mobile falls within the 
definition of a "major supplier," should it not be required to offer cost-oriented rates?  
 
A. Japan has been promoting further competition in the field of telecommunications under the 
"New Competition Promotion Program 2010," which is  a roadmap of measures to be implemented by 
the early 2010s.  As one of the approaches in the pr ogram, Japan has been reviewing the calculation 
methods for fixed interconnection rates including ta ndem level rates.  The actual cost method was 
introduced in 1997 for calculating interconnecti on rates among telecommunications carriers, and the 
Long-Run Incremental Costs (LRIC) method in 2000.  Through such review of calculation methods, 
the interconnection tariff has been lowered. As a result, in terms of tandem (IC) level rates, for 
example, the interconnection rates for 2007 were about one-third of those of 1994. 
 Japan recognizes that NTT DOCOMO's interconnection tariff for mobile phones has been lowered in 
a phased manner, and is now among the lowest in the developed countries.  Pursuant to the 
Telecommunications Business Law, interconnecti on rates of the telecommunications carriers who 
install Category II-designated telecommunications facilities should not be more than "the sum of 
reasonable costs and reasonable profit under efficie nt management" (Article 34, paragraph (3), 
item (iv)).   As part of such measures to improve cost me thodologies of telecommunications services, it was 
decided that incentives for the sales of terminal s and those for the sales of communications services 
should now be recorded separately. Incentives for the sales of terminal s should not  be included in the 
operating expenses of the operating profit and loss in  the telecommunications business.  They should 
therefore not be accounted as costs for mobile int erconnection. This accountin g rule is to be applied 
from FY 2008. 
 
Moreover, in the 2007 review of competition in the telecommunications business field, which was 
published in September 2008, the NTT DOCOMO Group was evaluated as being in a position to 
exercise its market power by itself.  On the oth er hand, however, the review pointed out that the WT/TPR/M/211/Add.1 
Page 252  
 
  exercise of such significant power is unlikely and  could be repressed due to the existing active 
competition among operators under the current regulation and market environment.  
 
Q39-1a.  Under the Port Transpor tation Business Law, new terminal  operators are required to conduct 
all terminal operations as a joint venture or under a close ties relationship with established Japanese 
operators.  Has this requirement b een modified or eliminated?   
 
A. There is no such clause in the Port Transpor t Business Law.  The permission requirement is 
stipulated in Article 6.1 of the Port  Transport Business Law as follows: 
- To have adequate facilities and workers at each  port and for each type of port transport 
business 
- To have appropriate plans to  implement port transport business 
- To have a management system whose scope of responsibility is specified 
- To ensure the accounting foundation of the business 
 Q39-1b. Are foreign companies permitted to establish their own stevedoring services operations 
(loading and unloading of containers) in Japanese por ts, based on the principle of national treatment? 
A. If companies acquire permission in accordan ce with the Port Transport Business Law to 
operate port transport businesses, they can opera te port transport businesses in Japan.  
 
Q39-1c. Do any non-Japanese companies (either shipping lines or marine terminal operating 
companies) operate stevedoring or marine term inal businesses in any of Japan's major ports?  
 
A. There are no foreign companies operating port  transport businesses in Japan's major ports. 
 
Q39-2. Has the power of the Japan Harbor Trans portation Association (JHTA) to control carrier 
operations through the prior consultation mechanism been reduced or eliminated through any of 
Japan's port reform initiatives?  If JHTA's power ha s been reduced or eliminated, has such power or 
authority been transferred to or assumed by, any other entity, orga nization or person?  
 
A. The Japan Harbour Transport Association only intervenes shippers and port transportation 
labor union in the prior consultation mechanism. 
 
Q39-3a. How many port transport business companies,  based on nationality, ha ve been approved at 
Japan ports for each year since 2004?  For each year since 2004, please identify for each company 
which has been approved the type(s) of business(es) (e.g., marine terminal operator) and the port(s) 
for which approval was given.   
 
A. Fourteen Japanese companies have been approved  since 2004.  The types of businesses are 
general port transportation businesses, port st evedoring businesses and barge transportation 
businesses.  The ports in which companies have be en approved was given are Kanmon, Nagasaki, 
Hannan, Osaka, Chiba, Akitaf unakawa, Mitajiri-nakanoseki, Am agasaki-nishinomiya-ashiya, 
Higashiharima, Kagoshima, Yatsushiro and Hime ji ports.  If companies acquire permission in 
accordance with the Port Transport Business Law to operate port transport businesses, they can 
operate port transport businesses in Japan. 
 
Q39-3b. What changes has the government made since 2004 in the application procedures or 
substantive qualifications for foreign compan ies to establish port business companies?  
 
A. The supply and demand adjustment regulation was eliminated, and the entry system was 
deregulated from a license standard to a permit standard in all ports in May 2006. 
  WT/TPR/M/211/Add.1 
 Page 253 
 
 
  Q40. Regarding airport landing fees,  in what ways have Japanese airports (and the Government of 
Japan, as 100% shareholder of Narita Airport) been guaranteeing transparency as recommended by 
ICAO?    
A. Regarding the airports under the administra tion of the government, transparency is ensured 
through the notification of the landing fee. 
 Moreover, airport fees in Japan's three major int ernational airports, Nar ita, Kansai, and Chubu are 
not charged by the government, but rather by each airport company. 
 
In establishing airport landing fees, each air port company has explained the reasons for the 
calculation and negotiated agreements with represen tative airlines (IATA) in an open and transparent 
manner, based on the actual cost of providing services as per ICAO reco mmendation.  Therefore, 
requests from the United Stat es have been already ensured. 
 
 
MEXICO ADD.1
 
 
Q1-1. Does the Copyright Law provide for the protection of titles, names, appellations, distinctive physical and psychological characteristics, or orig inal operating characteristics, applied to any of the 
following categories in accordance with their nature? 
 I. Periodical publications:  published in successive pa rts with a variety of content, with a view 
to indefinite continuation; 
II. Periodic broadcasts:  emitted in successive parts with a variety of content and capable of 
further transmission; 
III. Character-based, fictional or symbolic human personalities; IV. Persons or groups engaged in artistic activities;  and 
V. Promotional advertising:  involving a novel and unprotected mechanism for the purpose of 
promoting or offering a good or a service with th e additional incentive of giving the general 
public the chance to obtain another good or ser vice on more favourable conditions than are 
available in the ordinary course of trade. 
 If this is the case, under what legal provision are they protected?  
A. Please refer to Article2(1)(i), Article10, Ar ticle12, Article 56 of the Copyright Law including 
the provisions about serial publications, which a re likely to be related to your questions. 
 Informal translation of the Copyright Law of Japan:  http://www.cric.or.jp/cric_e/clj/clj.html 
 
Q1-2. Does the Copyright Law provide for the prot ection of expressions of folklore?  If so, how 
extensive is the protection of such expressions? 
 
A. If the expression of folklore meets the requi rements for "work" under the Copyright Law, it 
could be protected under the Copyright Law.  P erformance of the expression of folklore could be 
subject to protection by neighboring rights, even if the performed expression of folklore itself does not 
qualify as "work." 
 
Q1-3. What is the duration of copyright protection in Japan?  
A. The general term of protection for works is the life of the author and fifty years after his or 
her death.  For details, please refer to Section 4 of the Copyright Law. 
 WT/TPR/M/211/Add.1 
Page 254  
 
  Q1-4. What is the duration of the protection of related rights in Japan? 
 
A. The term of protection for related rights is fifty  years.  For details, please refer to Section 6 of 
the Copyright Law. 
 Q1-5. Does the Copyright Law or any other legisl ation contain provisions  on legal protection and 
legal remedies against the circumvention of technol ogical measures, as well as against the removal or 
alteration of electronic rights management information?  
A. Regarding the circumvention of technological protection measures (TPMs) as defined under 
Article2(1)(xx) of the Copyright Law, the Law provides measures that prevent unauthorized copying 
of protected works, and provides criminal penal ty under certain conditions (Article 2(1)(xx), 
Article 30(1)(ii) and Article 120bis(i)(ii)).  Additionally, the Unfair Competition Prevention Ac t also has relevant provisions. Although the 
purpose of the Act is to ensure fair competiti on among business operators, the Act provides civil 
remedies against the trafficking of devices or pr ograms whose sole function is to circumvent 
technological measures defined as ‘technological rest riction measures' under the Act  (Article 1, 2 
(1) (x)(xi), (7), Article 3( 1) (2) and Article 4).  
 
Q2-1. Which authority is responsible for imposi ng fines in respect of intellectual property? 
 
A. Regardless of whether or not it is an intellect ual property rights infringement, in general, 
fines for criminal penalty are, in accordance with the judicial decision by the court, executed by the 
order of the prosecutor. 
 Q2-2. How is the payment of fines for infringement of intellectual property rights guaranteed? 
 
A. Regardless of whether or not it is an intell ectual property rights infringement, the judicial 
decision with regard to monetary penalties including fines is, in principle, paid by those who are obliged to do so on a voluntary basis.  That said, when such a voluntary payment cannot be expected, 
including when the person who is obliged to make the payment does not  do so despite the fact that 
said person possesses enough assets, the money is collected on a com pulsory basis.  In such a case, 
the order of the prosecutor has the same e ffect as a compulsory title of obligation.  
 In addition, if said person is indi gent and cannot complete the payme nt, that person shall be detained, 
under supervision of the prosecutor, in a workhouse for the duration of a period which will be notified 
in advance by the court.   
Q2-3. Please explain in more detail what proce dure is followed by the customs authorities to 
identify goods that infringe intellectual property rights.  
A. Japan Customs has the authority to judge infringement of IPR in the Identification 
Procedures.  In the procedu res, it provides right holders and importers/exporters with enough 
opportunities to submit their opinions and evidence.  It makes a decision on infringement by carefully 
examining their opinions and evidence. 
 
Q2-4. Wiith regard to the procedure used  by Customs to detain infringing goods: 
 
(a) Do the experts consulted by the customs aut hority work for the Japan Patent Office, or are 
they independent lawyers or representati ves of the marks or rights affected? 
(b) Is the customs authority obliged to cons ult experts before issuing its opinion on the 
authenticity of the goods?  WT/TPR/M/211/Add.1 
 Page 255 
 
 
  (c) Does the customs authority have its  own intellectual property experts? 
(d) If it is found that the goods detained are orig inal goods, who is res ponsible for defraying the 
expenses incurred by the importer, such as storag e or even penalties for failure to deliver the 
goods on time. 
 A. (a) IPR experts are lawyers, patent attorneys and sc holars.  They are not officials of the Japan 
Patent Office. 
(b) Consultation with the IPR experts is not mandatory procedures. (c) IPR experts are not customs officers. (d) In order to compensate for such damage, Cu stoms has the authority to order rights holders to 
provide security. If security has not been provid ed, in principle, the importer should bear the 
cost. 
 
Q2-5. Under the Patent Attorneys Act, what are th e exclusive functions of patent attorneys?  Do 
they have the sole right to submit patent app lications and take any action in this field? 
 
A. Only a patent attorney or a lawyer can perform the business of representing others for 
procedures of patent application and so forth before the Japan Patent Office. 
 In principle, only a lawyer can act as counsel in  litigation regarding intellectual property.  However, 
a patent attorney may act as counsel in specific cases such as litigation rescinding a trial decision. 
 
Q2-6. What are the penalties for non-co mpliance with the Attorneys Act? 
 
A. Japan understands this question to be about  the Patent Attorney Act and answers this 
question to this effect. 
 
A person who is in violation of the Patent Attorney Act, will be punished with imprisonment with work 
or a fine.  In addition, this person will be subjected to disciplinary action by the Minister of Economy, 
Trade, and Industry if this person is a patent attorney. 
 
Q2-7. With whom may an appeal be lodged against an  examiner's refusal?  Can a subsequent appeal 
be made in the event that the refusal is confir med or the person concerned does not fully accept the 
decision.  
A. An applicant who is dissatisfied with an exami ner's decision of refusal may file an appeal 
against the decision of refusal by submitting a writte n request for appeal to the Commissioner of the 
Japan Patent Office (JPO).  Appeal examinations a re carried out by a collegial body of three or five 
appeal examiners in the JPO.  An applicant who is dissatisfied with a decision of ref usal of an appeal against an examiner's decision 
of refusal may appeal to the Intellectual Property High Court (IP High Court).  An applicant who is 
dissatisfied with an appeal decision of the IP High Court may further appeal to t e Supreme Court. 
 
Q2-8. On what grounds was the maximum term for protection of designs increased from 15 to 
20 years?  
A. Japan understands this question to be relat ed to the amendment to the Design Act. 
 
Attractive designs may be a source of added value fo r a long term. In fact, as of the end of 2004, 
almost 16% of registered designs still exist in the 15
th year from the date of registration.  Therefore, it 
was concluded that the duration of protection of design right should be extended to more than 
15 years from the date of registration.  WT/TPR/M/211/Add.1 
Page 256  
 
  On the other hand, in the case that the duration of protection would be extended to more than 
20 years, the extended duration stipulated by the amended Act would be quite different from the 
duration stipulated by the previous Act, thus c ausing an imbalance between  applicants who can enjoy 
only the previous duration and those who can enjoy the extended duration.  For these reasons, Japan 
considered it appropriate to extend the duration from  "15 years from the date of registration" to 
"20 years from the date of registration."  
Q2-9. Please explain in greater detail the natu re and operations of the Intellectual Property 
Headquarters.  A. In order to promote measures for the creati on, protection and exploitation of intellectual 
property in a focused and systematic manner, th e Intellectual Property Strategy Headquarters was 
established in the Cabinet. (Art. 24, the Intellectual  Property Basic Act).  The Headquarters consist of 
the Director-General, the Vice Dire ctor-Generals, and Members.  The post of the Director-General is 
served by the Prime Minister.  The posts of the Vice Director-Generals are appointed from among the 
Ministers of State.  The posts of the Members are filled by all Ministers of State other than the 
Director-General and Vice Director-Generals, and by  those having superior insights into the 
creation, protection and exploitation of intellectual  property who have been appointed by the Prime 
Minister.  The Headquarters develop a strategic program for the creation, protection and exploitation of intellectual property. (Art. 23, the Intellectual Property Basic Act) Related government ministries 
and agencies implement their measures in accordance with the program. 
 
Q2-10. With regard to the Act on the Prevention of  Unauthorized Recording of Movies in Theatres, 
which provides for criminal penalties for such unauthorized recording:  (a) What is the minimum penalty for this offence? 
(b) Is there any penalty for attempting to carry out this offence?  If so, 
(c) What is the applicable penalty and what objective and subjective conditions are taken into 
account for determining that such an attempt has been made, and 
(d) What procedure is followed if someone is detected while making a recording in a cinema? 
 
A. a) The punishment is imprisonment for a term  not exceeding ten years, or a fine not to exceed 
ten million yen, or both. 
b), c) None. d) The Copyright Law requires a complaint fr om the right holder for the prosecution of 
copyright infringements.   
After the complaint is made, a gen eral criminal procedure is carried out as stipulated in the Code of 
Criminal Procedure.  The complaint is received by  either a prosecutor or a judicial police officer, 
who, in general, conducts investigation.  The judi cial police officer, after conducting investigation, in 
principle, sends the case to th e prosecutor.  The pr osecutor decides wheth er he/she will initiate 
prosecution. 
 Q3-1. Who is entitled to own a geographical indication in Japan? 
 
A. Additional protection for geographical indicati on (GI) identifying liquors (wines, spirits and 
Sake (Seishu)) pursuant to Article 23 of the TRIPS Agreement is under the jurisdiction of the National 
Tax Agency in correspondence with footnote 4 of th e TRIPS agreement stating "Notwithstanding the 
first sentence of Article 42, Members may, with respect to these obligations, instead provide for 
enforcement by administrative action." 
 
Q3-2. With whom is a request for registration of a geographical indication filed? 
  WT/TPR/M/211/Add.1 
 Page 257 
 
 
  A. A place of origin for Sake (seishu) in the territory of any WTO Member other than Japan may 
be designated as geographical indication(GI) by the Commissioner of the National Tax Agency if it 
fulfills following requirements:  (1) The place of origin meets the definition of GI  referred to in paragraph 1 of Article 22 of the 
TRIPS Agreement. 
(2) The place of origin is protected as a GI in the territory of the WTO Member. 
 In terms of the places of origin for wines and spir its, the Commissioner of the National Tax Agency 
may designate the places of origin as GIs for wines and spirits only in Japan.  Although Japan does 
not have the designation system for the places of or igin for foreign wines and spirits, any GIs for 
wines and spirits in the territories of the oth er WTO Members are protected according to the 
provisions of Article 23 of the TRIPS Agreement. 
 
Q3-3. What protection is provided for foreign geographical indications? 
 
A. Any GIs for wines and spirits in the territori es of WTO Members are protected according to 
the provisions of Article 23 of the TRIPS Agreement. 
 
Q4-1. Please clarify the scope of each of these laws , that is to say, whether both laws (the Plant 
Variety Protection and Seed Act and the Patent La w) could apply to the same plant variety, or 
whether the relationship between them is governed by a possible application of patented technologies 
for the breeding of new plant varieties, which would be protected by plant breeders' rights.  
A. Inventions of plants and seeds are subjects of the Patent Act.  The Patent Act and the Plant 
Variety Protection and Seed Act cover different subject s.  However, both aim to protect intellectual 
property regarding plants and seeds and  are complimen tary to each other.  Theoretically, new 
varieties of plants can be protected by both plant breeder's rights and patent rights.  However, as the requirements for novelty or inventive step shall be  satisfied in order to obtain patent rights, new 
varieties of plants cultivated with conventional b reeding techniques may not fulfill the requirement for 
inventive step.  Therefore, new varieties of plants  are mainly protected by plant breeder's rights. 
 Q4-2. Please provide information on the criteria or  basis for the calculation of compensation for 
damage caused to the holders of plant breeders' rights, since this is a subject of particular interest and would provide a useful reference for the strengthening of the system of protection in Mexico.  
A. The methods to presume amount of damages are provided in Article 102 of the Patent Act or 
Article 34 of the Plant Variety Protection and Seed Act. 
  NEW ZEALAND
 
 Q1. Further to New Zealand's Question 5 from  the 2007 Review, could Japan please provide an 
update on any specific plans to pursue an intensif ied programme of bilate ral FTA/EPA negotiations? 
 
A. Japan's basic policy for EPA negotiations as a whole has not changed since the time of the 
2007 TPR.  Based on the existing EPA policy, Japan launched negotiations for the establishment of 
bilateral EPAs with Viet Nam, India, Australia and Switzerland in 2007.  In December 2008, an EPA 
with Viet Nam was signed.  An EPA with Switzerland will be signe d in February 2009. 
 
Q2. How does Japan assess the quantitative and qualitative  benefits to date of FTAs to which it is 
a party, as well as their expected effects? 
 WT/TPR/M/211/Add.1 
Page 258  
 
  A. Each EPA, in general, has contributed to the strengthening of the economic relationship 
between Japan and the other party of the agreemen t, thus positively contributing to the Japanese 
economy.  However, the EPA's direct effects upon ea ch party's economy are not easily identified and 
quantified.   
 Q3. Are there any policies in place to introduce fo reign investment or participation specifically 
into Japanese agriculture to help raise productivity etc? 
 
A. In regard to the introduction of foreign cap ital to Japan's agricultu ral sector, Japan handles 
such application in an appropriate manner. 
 
Japan does not have in place any scheme designed to attract foreign investment or capital the 
agricultural sector. 
 
Q4. New Zealand notes that Japan unilaterally reduced applied MFN tariffs on petroleum and 
industrial alcohol in FY 2008.  Could Japan please explain why it took these steps? 
 
A. In line with tariff elimination on crude o il in April 2006, Japan decided to reduce applied 
tariffs on petroleum products gr adually until FY2011. (FY2008: ¥4 34 to ¥1,614 per kilolitre FY2009:  
¥405 to ¥1,229 per kilolitre FY2010:  ¥375 to ¥99 5 per kilolitre FY2011:  ¥249 to ¥934 per kilolitre) 
 
With regard to industrial alcohol, since April 2006, the industrial alcohol market has been liberalized 
in accordance with the abolition of Alcohol Mono poly Law.  Japan decided to reduce applied MFN 
tariff on industrial alcohol ( 2207.10-190) to 10% gradually un til FY2010 (FY2008: 16.9% FY2009: 
13.4% FY2010: 10%).  
Q5. To what extent are Japan's Agricultural St andards aligned with international standards? 
 
A. Japan Agricultural Standards Law stipulates that in order to establish or revise JAS 
standards, the current conditions of and future pr ospects for the quality, production, transaction, 
usage and consumption of the products  in question, as well as inter national standards, such as Codex 
standards, must be taken into account. 
 
Q6. In 2005 we sought clarification on equiva lence of recognition of safety in 2005 (i.e. 
question 8, to which Japan responded that regulat ory authorities evaluate the comparability of 
conformity assessment schemes and equivalence of technical competence but that the specific ways of 
judging the equivalence of recognition depended on  each regulatory authority).  Can Japan please 
explain how it assesses the equivalence of safety of different materials in construction standards? 
 
A. If there are any specific cases that New Ze aland is referring to, please contact Japan's TBT 
enquiry point for information on the matter. 
 
Q7. To what extent are Japan's Industrial Sta ndards aligned with international standards? 
 
A. Japan has been aligning the JIS to correspond to  international standards which exist or will 
be newly established and has been working to en sure their compliance with  the WTO/TBT Agreement. 
 
Japan will continue such efforts. 
 
Q8. The Secretariat notes that Japan has amende d its non-quarantine pest list each year since 
2006.  The list, however, is still small resulting in  regular fumigation of imported products when 
organisms are found that are not on the list.  Is  there any reason why the list developed by the  WT/TPR/M/211/Add.1 
 Page 259 
 
 
  Japanese Ministry for the Environment of alien speci es recognised to be establis hed in Japan or found 
in the Japanese wild (as of October 2004) cannot be  added directly to the non-quarantine pest list? 
 
A. The invasive alien species desi gnated under the Invasive Alien Species Act are not subject to 
phytosanitary measures under the Plant Protection Act.  For more detail, please refer to 1c of the 
Section 2: Principles concerning the selection of IAS of the BASIC POLICY FOR PREVENTING 
ADVERSE EFFECTS ON COSYSTEMS CAUSED BY INVASIVE ALIEN SPECIES (Cabinet Decision as of October 15, 2004, please refer to the following website for details: http://www.env.go.jp/en/nature/as/041108.pdf). 
 
Q9. The Secretariat's report notes that Japan's PSE is provisionally estimated at 45% for 2007. 
This is a decrease from 55% in 2004-2006, a move New Zealand welcomes, although it remains well 
above the OECD average.  Does Japan intend to reduce the support it provides to its farming sector 
further over the next two years?   A. Japan is going to examine its agricultural policy, and give careful consideration to the various factors surrounding agriculture and rural areas in Japan, such as the strengthening of the capacity of the food supply, promoting the rural economy and safeguarding food safety and consumer 
confidence. 
 
Q10. The Secretariat's report notes that authorities consider the factors limiting the increase in farming scale include instability of income, prices  of products, dispersed farmland ownership, and 
inclination to hold land as asset rather than for pr oduction.  How does Japan intend to deal with each 
of these issues to strengthen its agricultural production base?  
 
A. Japan is currently considering amendments to  relevant laws.  The main purposes of these 
amendments will be as follows:  - to tighten regulations on the conversion of farmlands to other uses in order to prevent 
productive farmlands' from being converted in an reckless manner; 
- to review regulatory measures against the leasi ng of farmlands, to ensure that various types 
of producers will be able to engage in agricultural activities; 
- to establish systems to facilitate th e merger/grouping of dispersed farmlands. 
 In addition, a new direct payment system to core fa rmers was introduced in April 2007 with the intent 
of promoting efficient and stable farm management. 
 
Q11. New Zealand notes that despite a small incr ease in 2008, Japan's food self sufficiency rate 
remains around the 40% level on a calorific basis.  Th is is despite the objective contained in Japan's 
Basic Agricultural Plan to raise the food self sufficien cy rate to 45% by 2015.  Has Japan considered 
strengthening its trade linkages with food exportin g nations to secure a stable supply of food? 
 
A. The Basic Law on Food, Agriculture and Rural A reas, as well as the Basic Plan, stipulates 
that a stable supply of food should be ensured through a proper combination of increased domestic 
production, imports and stockpiling.  In regard to imports, the Basic Plan points out the necessity to strengthen collection and analysis 
methods regarding information on the international food supply, international demand and trade, and 
pursue information exchanges with food exporting c ountries.  Japan is required to make further 
efforts to secure stable and multiple sources of im ports, and to remove possible obstacles to trade 
such as export restrictions and export taxes. 
 WT/TPR/M/211/Add.1 
Page 260  
 
  Q12. What lessons has Japan drawn from the food cr isis regarding the role of trade to supplement 
its limited domestic production capacity?  
A. The recent food crisis reaffirmed the importan ce of the policy laid out in the Basic Law and 
the Basic Plan, which is explained in the answer to Q11. 
 Moreover, Japan made a proposal in coopera tion with Switzerland on the more effective 
implementation of Article 12 of the Agreement on Agriculture, "Disciplines on Export Prohibitions 
and Restrictions."  
 
Q13. We understand that Japan faced a shortage of  butter supplies during 20 08, and had to conduct 
emergency imports of butter using the current access  quota to make up for this shortage.  However, 
this increase in imports led to the automatic tri ggering of volume-based special safeguards against 
butter imports.  Has Japan considered taking any me asures to ensure that the special safeguards are 
not triggered in situations where imports are essential to make up for a shortfall in domestic 
production? 
A. The volume-based special safeguard was applie d against butter imports, as the total volume 
of butter imported exceeded the trigger level.  Re cently out-quota imports of dairy product have been 
increasing, a trend which may affect our domestic dairy industry.  The special safeguards mechanism 
has been applied, being consistent with the WT O agreements.  For the shortage of domestic dairy 
products supplies, Japan c onducted additional in-quota import, wh ich was out of subject of the 
special safe guards.    
Q14. Are there any long-term plans for the Jap anese agricultural industry to move away from 
setting production targets for the purpose of re gulating the domestic supply of some products? 
 
A. As for rice, the supply-demand adjustm ent is conducted by farmers and farmers' 
organizations based on the annual demand estimate pr ovided by the government.  There is no plan to 
abolish this system.  For milk, there is a producer group which manages a voluntary supply control system for raw milk 
production.  The government has not received any indication from said producer group that it will 
abolish this system. 
 
Q15. New Zealand noted with interest that Jap anese agricultural exports have continued to 
increase.  Could Japan please d escribe what trade policy issues it h as encountered in promoting sales 
of Japanese agriculture products overseas?  A. The major issues Japan has encountered in prom oting the export of agricultural products are 
as follows. 
 
Stable export cannot be maintained because of changes in the global economic situation and 
fluctuations in exchange rates.  
It is difficult to hold adequate level of quality and freshness during the transportation of some 
agricultural products.  
  WT/TPR/M/211/Add.1 
 Page 261 
 
 
  MALAYSIA  
 
Q1. We note that Japan has the zero standard on melamine at 0.5 ppm while in many other countries the acceptable melamine level is 2.5 ppm in  food.  Zero standard of melamine is not 
practical.  Is Japan considering re vising the standard on melamine. 
 
A. In Japan, the use of specific food additives (i ncluding melamine) is prohibited, in accordance 
with Article 10 of the Food Sanita tion Law.  All melamine positive cases discovered during testing 
method whose limit of detection (LOD) was 0.5 ppm  were caused by the intentional addition of 
melamine to food or food additives. Japan has no in tention of reconsidering the current standard for 
melamine.   KOREA ADD.1
 
 
Q1-1. In Japan's perspective, how does an EPA  differ in concept to a comprehensive FTA? 
 
A. The meaning of "Concept to a comprehensi ve FTA" is not clear.  Japan's Economic 
Partnership Agreements are, in  general, comprehensive in scope, covering not only trade and 
investment but also such fields as intellectual pr operty, competition or cooperation.  Japan's EPAs 
are made with the aim to enhance overall econom ic partnership with the partner countries.  
Q1-2. In Japan's EPA, the Bilateral cooperation chapter (section) is generally included in the 
Implementing Agreement, not in the main text of the Agreement.  Is this practice due to Japan's 
interpretation that the Implementing Agreement holds  the same binding power (authority) as the main 
text of the Agreement? 
 
A. In Japan's EPAs, the Chapter on Cooperation is normally included in the main text as well as 
in the Implementing Agreement.  They are equally legally binding.  
 
Q1-3. It is Korea's understanding that Japan h as emphasized the importance of cooperation in its 
Economic Partnership Agreements, and most incl ude a section on SME cooperation.  Could Japan 
provide concrete examples of substantive SME cooperation projects that have been devised & 
implemented within the context of its existing EPAs?  
A. Through its Economic Partnership Ag reements, Japan has been carrying out SME 
cooperation projects, using our expertise in the matter to meet the needs of all interested parties, and 
promote the SMEs of both sides.  Specifically, Japan has provided such assistance as the dispatch of 
experts for capacity-building and information exchange related to policies for SMEs. 
 
Q2-1. Please confirm whether Korea's understanding (that the proportion (ratio) of tax revenue 
derived from the personal income tax vis-à-vis the total tax revenue is higher for Japan than the 
OECD average figure) is correct. 
 (If answer to question directly above is 'yes') C ould Japan explain why the ratio of the personal 
income tax to the total national tax revenue is higher than the OECD average while the ratio of 
taxpayers subject to personal income ta x is lower than the OECD average? 
 
A. According to the Japanese statistics, the proportion of revenues from the individual income 
tax to the total tax revenue of Japa n is lower than the OECD average 
 
Q2-2. What is Japan's view on the statement by the Secretariat in para 77 suggesting that Japan is in 
need of broadening the tax base and improving transparency? WT/TPR/M/211/Add.1 
Page 262  
 
  A. With regard to broadening the tax base, as shown below, it is stipulated in the FY2009 tax 
reform bill, subject to the Diet deliberation as  of February 2009, that in the future fundamental 
reform of the taxation system, the Government will consider broadening the corporate tax base as 
well as reducing the effective corporate tax rate . And it is an issue in the future to broaden the 
personal income tax base. 
 
On the other hand, Japan does not consider that Japan's local tax system is complicated and not 
transparent just because it compri ses 23 different taxes.  In most of federal system countries, it is 
difficult to systematically recognize th eir local taxation systems, which is  attributed to the fact that 
these systems are stipulated by each of state.  Meanwh ile, Japan's local taxation is integrated into the 
"Local Tax Law", meaning that in general all of the tax items in local au thorities across the nation 
are accessible in one law.  Therefore, Japan doesn't think it right to regard Japan's taxation system as 
complicated because it is composed of many tax items.  
 
Q2-3. Does Japan have plans to reform its Income tax and Consumption tax system?  If so, it shall 
be appreciated if it could provide further information. 
 
A. The FY2009 tax reform bill, which is still bei ng deliberated upon by the Diet as of February 
2009, indicates the basic direction for fundamental tax reform in the future.  Amongst the overall 
reform of many taxes:   
 
The Government will consider, in regard to personal income tax:    - reviewing various tax credits and the structure of tax rates, with th e intent to redress 
disparities and restore the income redistribu tion function of the income tax system;  
- increasing the tax burden for those with hi gh-incomes;  through measures such as the 
measures such as the modification of the ma ximum tax rate and the maximum amount for 
income tax deduction; 
- decreasing the tax burden for lower and medi um income families.  Japan will take a 
comprehensive approach to this point that a cknowledges such issues as the financial burden 
imposed on families by child care and considers such budget expenditures as the issuing of 
refundable tax credits;   
- further promoting the convergence of financial income taxation.  
In regard to corporate income tax, with a view to  ensue consistency with international standards and 
strengthen the competitiveness of Japanese companies, Japan will consider reducing the effective tax 
rate as well as broadening tax base, taking in to consideration the subs tantial financial burden 
already imposed upon companies, including social security contributions.  
 With regard to consumption tax,  the Government will consider: 
 - changing the consumption tax rate, on the conditio n that the rate is clarified in the national 
budget and account settlement that  all revenue generated by consumption tax is spent on 
social security benefits (established pensi ons, medical care and nursing care) and on 
countermeasures against Japan’s falling birthrate, in order that it be clarified that the 
burdens of consumption tax will be cert ainly returned to the taxpayers;    
- giving consideration to those with low inco mes through a comprehensive approach that will 
recognize the budgetary expenditures of said people,  and consider such measures as multiple 
tax rates.  
 
Q3. According to the Secretariat Report, Japan has imposed temporary tariffs on 477 lines, with 
rates lower than that of general duties, until the end of 2008.   WT/TPR/M/211/Add.1 
 Page 263 
 
 
  1) What was the purpose of imposing temporary tariffs? 
2) Could Japan provide an exhaustive list of ta riff lines subject to temporary tariffs and their 
rates in the year 2008? 
3) Could Japan explain the procedures for the determination of temporary tariffs? 
4) Are temporary tariffs still effective in 2009? If so, please specify the lines subject to 
temporary tariffs and their rates. 
 
A.  
1) Temporary tariffs are enacted in order to achieve specific policy aims.  For example, 
environmental and industrial policies, due c onsideration is given to the results of 
negotiations, as well as the WTO ag reements, establishing these tariffs.  
2) Please refer to the following website for info rmation on the tariff lines subject to temporary 
tariffs;  http://www.customs.go.jp /english/tariff/2008_4/index.htm 
3) Please refer to the following website fo r the determination of temporary tariffs; 
http://www.customs.go.jp/english/c-answer_ e/imtsukan/ippanim/0 18ippanim1114_e.htm 
4) The current temporary tariffs found in 2) a re effective until 31 March 2009.  Japan has just 
submitted a revised draft of the Temporary Tar iff Measure Law to the Diet.  This draft 
includes the extension of the period of availability on the temporary tariffs, excluding HS5005.00, from 31 March 2009 to 31 March 2010. 
 
Q4. It is Korea's understanding that while in gene ral 'artificial textile products for automobile 
seats' are exempt from tariffs, the tariff rate on 'a utomobile mats in quadrate form (50cm×150cm or 
100cm×150cm)',usage of which is limited to automobile seats exclusively, is 9.6%. 
 If it can be proven that the seat material was made  specifically for automobile seats, can the product 
be granted exemption from tariffs? 
 
If so, what will be necessary to demonstrate this fact (i.e. what is the required documentation)? 
 
A. No. 
 Parts of seats are classified in HS  Subheading.940 1.90, only if the shape or other specific features are 
deemed to be designed solely or principally for seats.  This is described in the general Explanatory 
Note to Chapter 94, which is an o fficial interpretation by the HS Committee.  In Japan, parts of seats 
which are not made of leather under HS Subheading 9401.90 receive a tariff rate of zero (3.8% in the 
case of leather).  
HS does not stipulate that sheets of textile or ot her materials are regarded as parts of machinery for 
motor vehicles or other equipment. 
 
Q5. Currently, Japan classifies he rbal cigarettes as substitutes for tobacco, and thus imposes tariffs 
and various taxes such as the tobacco tax.  However,  considering that herbal cigarettes aid in smoking 
cessation, it is our view that classifying them into a different category must be reviewed.  
Furthermore, any prohibition on the advertisement of  these products and/or its function/effect should 
be removed.  Could Japan explain its' view on this issue?  
A. Japanese quasi-drugs stipulated in the Ph armaceutical Affairs Law (PAL) have active 
ingredients that affect, even if only mildly, hu man bodies and prevent (cure) diseases as a result of 
pharmacologic action. As the statement, "herbal ciga rettes" implies, herbal cigarettes are out of the 
scope of the PAL, as they only give psychological satisfaction as a substitute  and help to kill time WT/TPR/M/211/Add.1 
Page 264  
 
  without affecting human bodies.  Products are consid ered to be out of the scope of the PAL unless 
claims are made about pharmaceutical-like e ffects or functions in product advertisement. 
 According to the Tobacco Business law, subs titutes for manufactured tobacco are defined as 
"products other than manufactured tobacco wh ich are used for smoking," although pharmaceuticals 
and quasi-drugs stipulated in the PAL are excluded fro m this definition.  Since herbal cigarettes fall 
under the definition of a manufactured tobacco subs titutesuch definition but have not been approved 
as pharmaceuticals or quasi-drugs as stipulated in  the PAL, they are classified as substitutes for 
manufactured tobacco.  
Q6. According to the Secretariat Report, Japan applies differential duties and sliding duties to 
0.4% of the total lines. (a) 1) What is the reason for the imposition of sliding duties? 2) Could Japan specify the lines subject to sliding duties and the mechanism on which the 
imposition is based? 
3) Is there a possibility that varying the duty amount in accordance with actual prices will reduce 
predictability for taxpayers? 
 (b) 1) What is the reason for the imposition of differential duties? 
2) Could Japan specify the lines subject to di fferential duties and the mechanism on which the 
imposition is based? 
3) Is there a possibility that varying the duty amount in accordance with actual prices will reduce 
predictability for taxpayers? 
 A. (a) 1) The objective of sliding duties is to main tain a balance between protection for domestic 
producers and benefits for users/consumers, as a cer tain amount of tariff may be imposed if 
import prices go down but may not be imposed if the prices rise. 
2) The lines subject to sliding duties are; 0703.10ex, 7402.00, 7403.11, 7403.12, 7403.13, 
7403.19, 7403.22, 7403.29, 7801.10, 7801.91ex, 7801.99ex, 7901.11 and 7901.12, based on 
HS2007.  The duties are removed using a smoot hing adjustment beyond the threshold(b) of 
the import price. The mechanism is described in the following diagrams: 
  
 
CIF0ｔ ｈｒｅｓｈｏｌｄ(a)CIF＋ｔａｒｉｆｆ
ｔｈｒｅｓｈｏｌｄ(b)ｔａｒｉｆｆ
0CIF＋ｔａｒｉｆｆ
ｔａｒｉｆｆ
ｔｈｒｅｓｈｏｌｄ(a)ｔｈｒｅｓｈｏｌｄ(b) 
  WT/TPR/M/211/Add.1 
 Page 265 
 
 
  3) Japan doesn't think that there is the mentione d possibility, as the duty amount in accordance 
with the actual prices can be easily calculated utilizing the Customs Tariff Law and Temporary Tariff Measures Law. 
 (b) 
1) The object of differential duties is to keep  the balance between protection for domestic 
producers and benefits for users/consumers.  While a certain amount of tariff may be imposed 
if import prices go down, lower levels of tariff may be imposed if the prices rise. 
2) The lines subject to differential duties a re; 0103.92, 0203.11ex,  0203.12ex, 0203.19ex, 
0203.21ex, 0203.22ex, 0203.29ex, 0206.30ex, 0206.49ex, 0210.11, 0210.12, 0210.19, 
0210.99ex, 1602.41ex, 1602.42ex and 1602.49ex, ba sed on HS2007.  The tariff amount is set 
as the difference between the import prices and the standard import price.  The mechanism 
can be described in the following diagram: 
 
  
standard  
import 
price 
  
 
  threshold
  CIF
  CIF  tariff  
  
tariff 
threshold  
  
 
 
3) Japan doesn't think that there is the men tioned possibility, as the duty amount in accordance 
with actual prices can be easily calculated utilizing the Temporary Tariff Measures Law. 
 Q7. It has come to our attention that even for simple changes in worki ng conditions, pre-liminary 
consultations with the JHTA is necessary, causing unnecessary delays in unloading vessels.  
 
In light of the heavy burden of this condition, do es Japan have any plans to ease this requirement to 
facilitate doing-business in Japan’s harbors?  
A. The prior consultation procedures are a system based on an agreement among private 
companies at the request of shipping com panies, and issues regarding its improvement or 
abolishment should be discussed among the persons concerned.  These prior consultation proce dures were much improved in terms of the facilitation and 
transparency of procedures by an agreement among the persons concerned in October 1997.  As a 
result, conventional prior consultation matters thr ough the Japan Harbor Transportation Association 
have decreased by more than 95%, and shipping  companies have expressed their gratitude. 
 WT/TPR/M/211/Add.1 
Page 266  
 
  Additionally, another procedure, which does not involve the Japan Harbor Transportation 
Association, has been established.  Therefore, it depends on the decision of shipping companies 
whether to involve the Japan Harbor Transportation Association or not. 
 
Q8. Korea would appreciate Japan's explanati on of its safety screening system for progeny 
cultivar (stack) in GMO products, as well as the present status of the system. 
 
A. The safety assessment is  mandatory for every food (including stack) and food additive 
produced by recombinant DNA techniques (hereafter "G M foods"), as stated in the Food Sanitation 
Law. 
 
The Ministry of Health, Labour, and Welfare recei ves applications, and the Food Safety Commission 
evaluates the safety of GM foods in terms of human health.  
 
Q9. Korea would appreciate Japan's explanation on the requirements for, and any necessary 
documentation (if necessary) for exemption from the labeling requirements for GMO products when 
these products are exported into Japan.  
A. Genetically modified foods entering Japan sh all be subject to labeling requirements under 
Food Sanitation Law as well as under the Quality Labeling Standard for Gene tically Modified Foods, 
at the selling stage in Japan. 
 
However, labeling is not required for the following processed foods for the time being, for the reasons 
cited respectively.   
- Foods in which recombinant DNA and the resulting proteins from such DNA have been 
eliminated or broken down. 
 
 Examples of such foods are soy sauce, soybean oil, corn oil,  cornflakes, and mashed potatoes. 
It is technically difficult to determine if they are genetically modified foods or not. 
 
- Products in which genetically  modified ingredients do not constitute main ingredients: 
 Labeling is legally required only for products in which genetically m odified ingredients are 
among the three main ingredients and account for five percent or more of the product’s total 
weight.  
 
Q10. Does Japan have plans to revise its exis ting statutory regulations on GMO labeling? 
 
If so, Korea would appreciate Japan's detailed explanation on this matter (control of the revision, including the objective of the revi sion, expected timeline, etc) 
 
A. Japan is not considering a revision of the Qua lity Labeling Standard fo r Genetically Modified 
Foods.  Japan has no plan to revise the section of the Food Sanitation Law on GMO labeling. 
 
Q11. It is Korea's Understanding that Japan’s cosmet ic regulations prohibit the use of oriental herb 
extracts in cosmetic products, because such ex tracts are listed in the Japanese Pharmacopoeia. 
Accordingly, in order to export oriental herbal cosmetics or cosmetic products containing specific 
oriental herb extracts, it is necessary to obtain a prescription specifically intended for export to the 
Japanese market. Obtaining such prescriptions incurs extra costs and causes unnecessary difficulties 
for manufacturers.   WT/TPR/M/211/Add.1 
 Page 267 
 
 
  In light of this regulation which inhibits the export of cosmetic products with oriental herb extracts to 
Japan, would Japan consider easing this regulation in  the immediate future if such extracts have a 
history of international use?   
A. Whether there is a "history of internati onal usage" or not, th e Japanese Standards for 
Cosmetics do not allow the inclusion of drugs in cosmetics unless the Minister of Health, Labour, and 
Welfare approves it.  Since the herbs listed in Japanese Pharmacopoeia are categorized as drugs, 
extracts of herbs are not allowed in cosmetics unle ss approved by the Minister.  If you wish to use 
them in cosmetics, an application must be filed w ith the required documents in accordance with the 
notification PFSB/ELD No. 0325019, which was issued  on March 25, 2009 ("Handling of the medical 
ingredients to be included in cosmetics").  Japan will examine the subm itted documents, determine 
whether it is appropriate for the materials to be in cluded in the category of cosmetics, and revise the 
standards of cosmetics, if necessary. 
 
Q12. The standard process time for the review of qu asi-drugs in Japan is six months.  This process 
time also applies for products that are identical  to those already approved in terms of active 
ingredient, content (concentration), applicati on method, dosage, standard, and test method. 
 Does Japan have any plans to simplify the review  process for products that have the same active 
ingredient, content (concentration), application me thod, dosage, standard, and test method as products 
that are already approved? 
  
A. In regard to the application of quasi-drugs  that are recognized to have identical approval 
contents of existing quasi-drugs, applicati on documents can be omitted except those on 
physiochemical properties, specifications and te sting methods (documents on the origin or 
background of discovery, and conditions of use in foreign countries should be attached if necessary). 
 
For these quasi-drug applications, although application documents have been simplified, it is difficult 
to change the standard processing time for approval due to a large number application and limited 
resources, including manpower. 
 
Q13. It is our understanding that Japan has recen tly adopted a new measure as follows:  allowing 
special deduction of 10 million yen (or the total am ount of the long-term transfer income of the 
corresponding year, when the transfer income is less than 10 million yen) from long-term income 
transfers related to transfers of land in the corresponding year, in the case that an individual, holding proprietorship of land for more than five years, transfers domestic land acquired between Jan 1, 2009 
to Dec 31, 2010. 
 
Could Japan provide the rationale  for adopting such new measure? 
 
A. Taking into account the current economic and financial environment and contribute to 
economic recovery, Japan is planning to take several tax-reduction measures.  
To support the flagging land market, it is necessary  to stimulate demand for land and through to 
promotion of liquidation and effective utilization.  In this context, Japan will introduce the new 
measure mentioned in the question.   
 
Q14. As far as we know, the branches of foreign ba nks in Japan are not allowed to engage in both 
banking and trust activities simultane ously.  Also, as is the case in many other countries, in Japan 
foreign businesses are not allowed to engage in th e air transport industry.  According to page 9 
paragraph 25 of the Secretariat Report, however Japan has undertaken efforts to gradually reduce 
regulatory interventions in several sectors, includi ng the financial services and air transport services.  
 WT/TPR/M/211/Add.1 
Page 268  
 
  Could Japan further elaborate on the results of the ‘sustained efforts’ mentioned in para 25, and 
provide further information if any c onsideration has been given to the restrictions in the sectors stated 
above?  
A. As for foreign banks to conduct trust business in  Japan, they used to be required to obtain a 
banking license, based on the Banking Act.  However,  owing to the revision of the Trust Business Act 
in December 2003, a person who is governed by th e laws and regulations of a foreign state and who 
engages in Trust Business in a foreign state (excluding trust companies), in other words, foreign trust 
business operators (Article 2-5 in the Trust Bu siness Act), can conduct trust business at their 
principal branch and their other branches establis hed in Japan only if they have certified the license 
of the branches as the bases of trust business in J apan. (Article 53-1 in the Trust Business Act)  
However, even in this case, the branches of foreign banks in Japan are not allowed to engage in both 
banking and trust activities simultane ously. (Article 21 in the Trust Business Act and Article 12 in the 
Banking Act)  
In the air transport service sector, Japan is promo ting aviation liberalization policy based on the 
"Asian Gateway Initiative", and has agreed with seven  Asian countries and regions (the Republic of 
Korea, the Kingdom of Thailand, the Macau SAR, the Hong Kong SAR, Viet Nam, Malaysia and Singapore), as of February 2009.  Also, with re gard to PEX fares applied to air tickets directly sold 
by airlines to individual customers, Japan has remo ved the restriction on the minimum floor (30% of 
the IATA PEX fares) in FY 2008. 
 
For further improvements in various  areas, the latest Council for the Promotion of Regulatory Reform 
(CPRR) report, submitted to the Prime Minister last  December, presents plenty of recommendations 
including regulatory reforms in financial and air transport industries.  As for financial services, for 
example, it states that Japanese government should consider what kind of regulation Japan should 
impose against foreign entities in a comprehensive manner.  
Q15. According to page 13, paragraph 33, footnot e 39 of the Secretariat report, FDI inflow into 
Japan in 2006 was -$6.5 billion (USD).  1) What is Japan's view on this figure?  What is  Japan's assessment on the reason for this result 
which is vastly different from the figures re gistered by the US and EC during the same 
period? Is Japan of the view that the notion of a "closed business culture" of Japan a factor? 
2) Are there any measures being contemplat ed to address the notion referred to above? 
 In 2007, FDI inflow rebounded remarkably. 3) In the view of Japan, what are the factors that contributed to this sudden turnaround in FDI 
inflow? 
 
A. 1) Japan recognizes that the level of FDI into  Japan remains lower than that other countries. 
Some of the reasons for this would be the geographic element, the language barrier, and so forth.  In addition, a decrease of business cost, regulatory and systemic reform, and an 
increase of transparency are need ed to increase inward FDI.  While not a few Japanese 
companies still feel resistant towads regarding the takeover of domestic companies by foreign 
companies, Japan will try to open the Japanese market and make it more attractive. 
2) Members of the Expert Committee on FDI Prom otion provided specific recommendations in 
the "Five Recommendations Toward the Drastic  Expansion of Foreign Direct Investment in 
Japan." 
 
For further information about the recommendati ons, please refer to the following website: 
http://www5.cao.go.jp/invest-japan/index.html   WT/TPR/M/211/Add.1 
 Page 269 
 
 
  In December 2008, Japan revised the "Program for th e Acceleration of Foreign Direct Investment in 
Japan" in order to incorporate the five reco mmendations.  Japan considers that the steady 
implementation of these measures and periodical foll ow-up of the program will further increace FDI 
into Japan.  
3) Members of the Expert Committee on FDI Promo tion pointed out that the biggest obstacle is 
the weakness of Japan's economic growth potential. 
 
Q16. Korea understands that the Japanese govern ment has carried out institutional reforms and 
deregulatory measures to improve the investment environment and attract investment from foreign 
businesses.  However, it is our view that complex non- institutional factors con tinue to hamper foreign 
companies' efforts to enter and participate in th e Japanese market, including in the IT industry, for 
example.  According to reports, due to existi ng tightly linked subordina te relationship between 
procuring firms and the supplying firms, many Japanese companies are prohibited, on a de-facto basis, from engaging in business with new forei gn suppliers.  In our view, these practices serve as 
barriers to market entry for foreign companies ma king it costly to penetrate the Japanese market. 
 What is Japan's view on this issue?  
A. Japan is focusing on the following actions as its main targets:  the strategic dissemination of 
information by local governments and by regional  collaboration between local governments, the 
improvement of the investment environment through  measures such as those to facilitate M&As and 
international capital flows and active publicity to  welcome foreign compani es in domestic and foreign 
areas.  Japan revised the "Program for the Accele ration of Foreign Direct Investment in Japan" by 
reflecting those targets into the program in December 2008.  Japan will continue to implement 
measures through periodical follow-up of the program. 
 
Q17. According to the Secretariat Report, Japan  has adopted a number of institutional reform 
measures aimed at removing obstacles to FDI.  Ho wever, our suppliers fa ce seemingly ‘nuisance’ 
regulations on a daily basis.  For example, it is our understanding that for a fore ign company to register as a corporation within 
Japan, an address of the corporation is required;  thus, a lease of an office building is needed for 
registration.  However, to lease real estate in Japan, a formal corporate name (registered in Japan) is 
required.  These sort of inconveniences owing to conflicting requirements under law are being 
reported by firms doing business in Japan  
In connection to the above, has Japan given consider ation to improving foreign investment procedures 
such as that mentioned above?  
A. Japan does not plan to amend the Compani es Act regarding the registration of foreign 
companies.  
Under the Companies Act, a foreign company sha ll register (i) the address of a representative if the 
company does not have any business office in Japan or  (ii) the address of the business office where 
the company has a business office.  Thus, a forei gn company may register as a foreign company even 
if it does not have a business office in Japan. 
 Q18. For a foreigner to engage in corporate ac tivities in Japan, one must receive an "Investor/ 
Business Manager" visa or an "Intra-Corporate Transf ers" visa.  But when a parent company wishes 
to transfer an employee to head a subsidiary in Japan by using the "Investor/Business Manager" visa, 
the employee is required to own a certain portion of th e parent company's capital.  So the transfer of 
capital to the employee might be needed, and such process could cause inconvenience.  Meanwhile, to WT/TPR/M/211/Add.1 
Page 270  
 
  receive an "Intra-Corporate Transfers" visa, one must  have been working in the parent company for at 
least a year.  This would make it difficult for a co mpany to send newly recruited experts directly to 
Japan.   According to paragraph 60 of page 30 of the S ecretariat Report, the regulations on movement of 
natural persons have been reformed .  Has any consideration been given to the matters stated above? 
(i.e. the easing of the capital holding requirements  or the working period conditions mentioned above) 
 
A. Japan assumes that reforms of regulations on movement of natural persons referred to in the 
Secretariat Report mean that designated research ac tivities, designated data processing activities, 
and other actives were added to the activities in whic h it is authorized to be engaged in under the 
status of residence of "Designated Activities."  The measures mentioned above are aimed at expanding the acceptance of highly-skilled fo reign workers such as foreign researchers and 
engineers;  they are not related to the status of residence of "Investor/Business Manager" or "Intra-
company Transferee." 
 
Regarding the status of residence of "Investor/Business Manager," foreign nationals are required to 
have invested a sufficient amount of money in cases where they are to set up an office in Japan as a 
basis for their business activities and commence th e operation of their bu siness.  However for 
example, in cases where an applicant is to operate  the business on behalf of a foreign national who 
has invested in such a business in Japan, the applicant  concerned is also eligible for the status of 
residence of "Investor/Business Manager."  In this ca se, the applicant is not required to have invested 
a sufficient amount of money.  Moreover, even if an applic ant is not eligible for the status of residence 
of "Investor/Business Manager," the applicant may ent er and stay in Japan provided that this person 
meets the requirements of the status of residence of  "Specialist in Humaniti es/International Services" 
or "Engineer." 
 
Regarding the status of residence of "Intra-com pany Transferee," the reason why the applicant must 
have been employed at the main office, a branch o ffice or other office outside of Japan for at least a 
year immediately prior to the transfer (*Note) is  to prevent a foreign company from transferring its 
new employee who does not have any specialized knowle dge or skills pertaining to the activities of the 
company concerned only for the purpose of securing its labor force in Japan.  Therefore Japan has no 
plan to ease this criterion.  
 *Note: Japan understands that Korea also has a similar requirement. 
 
Q19. Related to technical regulati ons mentioned in Paragraph 47 of Page 46, under the terms of the 
Electrical Appliance and Material Safety Law, expo rters of digital video recorders are required to 
obtain safety certification for their products.  Th e Japan Quality Assurance Organization (JQA) and 
other domestic organizations test such products and issue safety certificates, as do overseas organizations such as Underwriters Laboratories, Inc.(UL).  However, Japanese buyers demand that 
exporters certify their products only with the JQA, and this generates unnecessary costs.  
 
Does the Japanese government have a ny plans to designate certain foreign organizations which carry 
out the same tests and accept the results on a recipr ocal basis, in a case when foreign governments 
recognize Japan's safety certification process?  
A. Japan has no any intention to oblige exporters to  certify their products with the JQA.  Which 
conformity assessment body is c hosen by a private company for certification of its products is a 
business matter.  Japan is not in a position to comment on this issue.      WT/TPR/M/211/Add.1 
 Page 271 
 
 
  Under the Electrical Appliance and Material Safety Law, a foreign conformity assessment body can 
be registered by Japan as an organization wh ich can perform conformity assessments and 
certifications, whether or not its c ountry concludes a MRA with Japan.  
 Therefore, foreign producers which export electric pr oducts to Japan, have the same opportunities in 
terms of conformity assessments as Japanese dom estic producers, as long as foreign registered 
conformity assessment bodies exist in their home countries. 
 
Q20. Related to standards mentione d in Paragraph 48, Page 46, to sell food containers in Japan, it is 
necessary to obtain safety certification from a desi gnated organization.  Any company seeking such 
certification must become a member of the organization, and admission is granted only upon the 
recommendation of an existing member.  However, current members of the association are reluctant to write recommendations for foreig n companies which will then be th eir competitors;  this impedes 
foreign companies from obtaining the necessar y certification to enter the market.  
 
Does the Japanese government have any plan s to address/rectify this situation? 
 A. We are not aware of the occurrence of such cases.  If there is a concrete case Korea is referring 
to, please contact Japan's TBT enquiry point about the matter.  Q21. The Secretariat Report indicates that as of 2008 Japan had 237 regulations pertaining to road 
vehicle safety standards, of which only 27% corres ponded to international standards (compared with 
20% of 204 regulations in 2005).  Unde r this circumstance, we are of th e view that it is unfair to apply 
such stringent regulations to special vehicles wh ich operate under certain road and environmental 
conditions.  
Is the Japanese government willing to allow the tempor ary operation of special vehicles on the basis 
of reciprocity?  
A. Regardless of whether a vehicle concerned is a special vehicle, or whether the vehicle is 
operated under limited conditions, vehicles operated on public roads in Japan are required to comply 
with domestic regulations which have been deve loped in consideration of the specific traffic 
conditions of Japan, and with an intent to ensu re their safety and environmental friendliness. 
 Japan is proactively promoting the international har monization of domestic regulations on vehicles to 
comply with the Regulations annexed  to the 1958 Agreement of the UN. 
 Q22. Related to the certification system for medical devices mentioned in Para 54, page 49, it takes 
more time to register products, including imported medical devices, with Japanese authorities compared with those other advanced countries.  Fu rthermore, medical devices that have already been 
approved for sale in other countries must go throug h additional testing before the Japanese authorities 
will approve them: this makes it difficult to enter the Japanese market.  
Does Japanese Government have plans to improve this process? 
 
A. The establishment of a faster and better approval  system is an important issue, and Japan is 
making every effort to achieve it.    
Japan requires a minimum amount of essential data necessary to ensure the safety and effective 
performance of a medical device at a premarke t review, and does not require unreasonable additional 
testing.  
 WT/TPR/M/211/Add.1 
Page 272  
 
  Q23. Japanese automakers have strong control over car dealerships, which makes it difficult for 
dealerships to carry foreign cars.  Also, dealer ships provide warranties for Japanese vehicles that 
impede foreign carmakers from entering the market. Paragraph 66 of page 51 states that Japan appears 
to be putting less emphasis on imports promotion.  
Does Japan agree with this statement?  If not, what measures have been taken by the Japanese 
government to promote import?  
A. The mentioned statement does not correctly re flect the current situation of the Japanese auto 
market.  
 
There is no restriction on entering the Japanese market for foreign automakers.  Any Japanese 
automaker can build sales networks, and make a contra ct with dealers to sell only cars produced by 
the automaker.  Foreign automakers can also build  their own sales networks, and some makers 
actually do have sales networks in Japan.  Sales contracts made by Japanese automakers do not 
exclude foreign automakers from en tering the Japanese market.  
 With respect to the promotion of imports of veh icles, "the Preferential Handling Procedure for 
Imported Motor Vehicles" (the PHP) is designe d to be a vehicle certification system.  The PHP 
applies only to imported vehicles which possess a small market share in Japan.  The PHP uses even a 
simpler procedure than the Type Designation Syst em, because the requirement to submit sample 
vehicles for each imported type has been om itted, and the documentation has been simplified. 
Regarding the sale of cars, there is no regul ation to discriminate between a Japanese car and an 
imported car. 
 
Q24. The Japan External Trade Organization (J ETRO) has undertaken several export promotion 
activities to assist small and mid-size enterprises.  
 Could Japan supply the total amount of government  expenditure earmarked to support such export 
promotion activities?   
A. Japan's expenditure for export-promotion rel ated activities to assist small and mid-size 
enterprises through JETRO is about 900 million yen in FY2008.  
Q25. Paragraph 109 of page 63 details, in an indirect manner, the difficulties foreign companies 
face in participating in government funded project s, including for power generation facilities which 
are under a ‘closed distribution system'.  Large-s cale manufacturers having distribution companies as 
affiliates or partners control the first distribu tion channels, and request Japanese products in their 
specifications.  They also procure through their subsidiaries and require vendors to use specific 
technologies and to register similar products separat ely.  As a result, fore ign companies have limited 
opportunities to supply major facilities to Japanese electricity companies.   What is Japan's view on this issue?  Does Jap an have any plans to rectify this practice? 
 
A. Power generation projects which are subsidi zed by the government are implemented fairly 
and properly.  Japanese electricity companies are pr ivate, and the Japanese government is not in a 
position to comment on any such business activiti es as procurement by private companies. 
 Q26. a) Paragraph 27 states that currently there ar e no plans to further liberalize the Japanese retail 
market for electricity and the auth orities plan to review the liberalization of the electricity retail 
market in five years.    WT/TPR/M/211/Add.1 
 Page 273 
 
 
  Does the Japanese government intend to promote a wholesale market for electricity to promote 
competition among power generation companies?  If so, what are the specifics of its plan?   b) In Japan, electricity companies monopolize regional markets.   
Does the Japanese government have a concrete  plan to change this situation? 
 
A. a) Japan has discussed measures to increase li quidity and vitalize the competitive environment 
of the power generation and wholesale electric power markets, because they contribute to the 
vitalization of the retail market as well as to a st able supply through the effective utilization of the 
power supply capacity on a nationwide scale. 
 The concrete measures that will be implemented for the vitalized trading in the wholesale electric 
power market are as follows:  - Expansion of trading menu (invigoration of fo rward transactions, establishment of a market 
which provides possibility for transaction after the gate closure of the day ahead market) 
- Improvement of trading rules - Establishment of trade expansion goal s to be shared among participant 
- Promotion of transactions surveillance on the exchange  b) After the implementation of system reforms to  develop the environment for competition in the 
liberalized market, and after a certain period of time later (somewhere around 2013), the status of 
customers' choice and other conditions in the liberalized  market will be reviewed.  And on the basis of 
the results, whether the scope fo r liberalization of the electricity retail market should be expanded 
will be considered. 
 Q27. Could Japan specify under what conditions FDI in the electricity and gas industries is 
permitted and not considered to be a threat to na tional security, public order and/or public safety?  
Please feel free to answer using the only case of 2008 (referred to in the Secretariat Report) as an example.  
A. Japan reviews whether or not respective cases have the possibility of disturbing national 
security, public order or public sa fety depending on their specific situations.  In the case of 2008, 
Japan reviewed the notification based on the Foreign Exchange and Foreign Trade Act (FEFTA) submitted by a foreign investor on 15 January 2008  regarding a planned investment to a wholesale 
electric power company.  After the review, it was deemed that the proposed investment could have 
adverse effects on the construction and operation of  the companies' nuclear power plants currently 
under construction, thereby causing negative impacts on the stable supply of electric power in Japan 
as well as on Japan's nuclear energy and fuel-cycle policy.  Thus, the Japanese government 
recommended the foreign investor to discontinue th e planned investment on 16 April 2008.  Since the 
foreign investor refused to accep t the recommendation on 25 April 2008, Japan ordered the foreign 
investor to discontinue the planned investment on 13 May 2008.  
 Q28. Despite stated plans to simplify customs cl earance procedures (Paragraph 25 of page 9) and 
reciprocal removal of restrictions on entry points (paragraph 68 of page 92), Korean companies are 
presently facing difficulty at customs because no custom s clearance system has yet been established at 
Haneda Airport (Tokyo international Airport).  At  present, eight flights operate between Haneda 
Airport and Gimpo Airport (Seoul) daily. However,  it is impossible to clear customs at Haneda 
Airport and freight that arrives there must be tr ansported via truck to Narita Airport, generating 
unnecessary costs in the process.  Furthermore, the journey from Haneda Airport to Narita Airport delays the customs clearance process by about one day, and since trucks are not loaded to full 
capacity there is great inefficiency and waste.  To en sure that bilateral trade is fully promoted and all 
the necessary support system functions smoothly, it is  imperative for Haneda Airport to put in;  lace WT/TPR/M/211/Add.1 
Page 274  
 
  facilities and systems that match the efforts of Gimp o Airport, which already allows direct customs 
clearance.  Korea looks forward to Japan taking the n ecessary steps at the earliest possible juncture to 
establish a well functioning customs clearance system at Haneda Airport.  Korea seeks Japan's views to the above. 
 
A. Japan Customs has adequately implemented custom s procedures that keep up with the trends 
in demands for customs clearance.  At Haneda sub- branch customs, located in the Haneda Airport, 
customs clearance officers are engaged in the clea rance of commercial cargo.  In 2008, Haneda 
sub-branch customs dealt with approximately 8,00 0 import and export declarations.  It has been 
learned that international freight facilities in and around Haneda Airport have been developing their 
services for the internationalization of the airport by 2010.  In case the actual demand for customs 
clearance in Haneda Airport increases, Japan custom s will consider making relevant arrangement in 
order to react to such demands. 
 Q.29 Paragraph 75 of page 93 indicates that questions may arise concerning the relationship 
between the Anti-monopoly Act and the activities of  associations of qualified professionals which 
may require mandatory membership, and compliance with their rules.  On April 1, 2008, Japan 
revised its Construction Act:  when assessing the level of technology offered by a construction 
company, Japan now assigns additional points to professionals who have completed a Japanese 
construction supervisor program (or other Grade 1 technician's class).  The Act also stipulates that 
Japan must award the same number of points to any foreign technician deemed to have completed an 
equivalent program.  However, foreign companies co ntinue to face difficulties, as there are no specific 
guidelines clarifying which programs are accepta ble equivalents and which documents their 
technicians must submit as proof of completion.  For this reason, there are calls from our industry on the need to request Japan to set forth, in a prom pt manner, specific and clear criteria on this topic. 
 
Could Japan comment on the above? Are ther e plans to introduce such criteria? 
 
A. When evaluating the level of technology offered  by a construction company in judging matters 
for management, it is appropriate to make a detaile d evaluation taking into consideration not only the 
number of engineers, but their skills, their efforts to  continuously learn, and so forth.  Therefore, 
additional points are given for management e ngineers who have attended the management engineer 
course that management engineers must undergo once every five years. 
 At present, there are no plans to establish criteri a. However, should foreign companies apply, the 
Ministry of Land, Infrastructure, Transport and To urism will conduct appropriate  evaluation from the 
viewpoint of the non-discriminatory principle, taki ng into consideration the equivalence between the 
management engineer course system in Japan and those in foreign countries. 
 
 
MEXICO ADD. 2, 3, AND 4
 
 
Add. 2  Q1. Paragraph 8 refers to the adoption by the Gove rnment, in June 2008, of a series of measures, 
including the Economic and Fiscal Reform 2008 (B asic Policies);  the Comprehensive Immediate 
Policy Package – Easing Public Anxiety;  and th e Economic Policy Package:  Measures to Support 
People's Daily Lives.  Could Jap an provide more details on th ese programmes and the benefits 
derived from their implementation?  
A. The Government of Japan have formulated three economic policy packages in face of the 
current financial situation since august 2008.  Plea se refer to website below for more information.  WT/TPR/M/211/Add.1 
 Page 275 
 
 
  These packages will promote employment and cor porate financing, and th us improve Japanese 
economy as a whole.  (Immediate Policy Package to Safeguard People's Daily Lives) http://www5.cao.go.jp/keizai1/2008/081224summary-english.pdf 
 
(Measures to Support People's Daily Lives) http://www5.cao.go.jp/keizai1/2008/081201outline-english.pdf  (Comprehensive Immediate Policy Package) 
http://www5.cao.go.jp/keizai1/2 008/0918summary-english.pdf 
 
Q2. Chapter II(4)(ii)(a). Paragraph 19 of the WTO Secretariat Report states that the entry into 
force of Japan's different bilateral agreements with ASEAN countries and the FTA with ASEAN as a 
bloc will not lead to their integration into a singl e FTA.  Could Japan explain the benefits of having 
individual agreements and a separate bloc agreement? 
 
A. Bilateral EPAs may include detailed provisions  for trade related rules, including those on the 
liberalization of trade in goods and services as well  as tariff concessions tailored to the particular 
needs of both Japan and the other party.  In com parison, as an agreement with ASEAN as a whole, 
AJCEP enhances the strategic relations between J apan and all of the members of ASEAN.  It also 
strengthens the production network covering Japan and ASEAN through the establishment of common 
rules. 
 
Q3. Chapter III(2)(i).  Paragraph 16 refers to th e introduction of a Common Portal for the Next 
Generation Single Window in October 2008.  Could Japan provide more information on this portal 
and the type of formalities that can be carried out? 
 
A. Japan Customs has been developing Single Window system in Japan, in which information 
and communication technology in co-operative arrangements between Customs and other border 
agencies (Ministry of Justice;  Ministry of Land, Infrastructure and Transport;  Ministry of 
Agriculture, Forestry and Fisheries;  Ministry of Economic, Trade, and Industry;  Ministry of Health, 
Labor and Welfare) to enable all the parties in  an import/export and vessel clearance transaction to 
use a Single Electronic Window.  Through this wind ow relevant official boar der agencies can share 
prescribed control data and provide traders with a streamlined "one stop shop" release/clearance 
processing system.  
The border agencies concerned have been jointly developing the Common Portal, which is the portal 
for the "Single Window," which was introduced in October 2008.  The portal has unified applicant ID system, elect ronic application process and data input processes 
all of which previously had different specifications  among the agencies concerned.  The portal has 
also enabled data-sharing among the agencies c oncerned, and helped applicants to save work by 
allowing them to reuse basic information they ha ve submitted to the Common Portal.  Furthermore, 
these highly convenient services are provid ed through a user-friendly interface. 
 
Q4. In paragraph 68, it is stated that, under Artic le 19 of the Customs Tariff Law, tariffs on raw 
materials used in the production of export goods by factories approved by Customs may be reduced, 
exempted or refunded (by a drawback scheme).  C ould Japan indicate what cr iteria the customs office 
uses to authorize factories to receive these benefits?  
A. When deciding the subjects for the abovemen tioned tariff reduction, refund or exemption, 
Japan takes into account the need to of lighten the burden of these tariffs from the viewpoint to of WT/TPR/M/211/Add.1 
Page 276  
 
  encouraging the import of raw materials and promoti ng the export of goods at the same time.  Scope 
is determined by the Cabinet Order for enforcement of Customs Tariff Law. 
 
Q5. In paragraph 11, it is stated that the MAFF re leases on the Internet the names of companies or 
persons that are allocated tariff rate quotas.  In th is connection, footnote 10 gives a link at which the 
names may be consulted.  However, the link provides no information. 
 (i) Could Japan provide the correct link at which this information is available? (ii) Is this type of online information availabl e in respect of preferential tariff rate quotas under 
free trade agreements?  If so, please pr ovide the electronic Internet link. 
 
A. The names and addresses of importers who receive quota certificates are made public on the 
website of the Ministry of Agriculture, Forestry and Fisheries. Please refer to the following websites.  
(TRQ except FTA)  
http://www.maff.go.jp/j/kokusai/boueki/triff/t_kanwari/04/index.html  (Japan-Mexico TRQ) http://www.maff.go.jp/j/kokusai/boueki/triff/t_mex/04/index.html  
(Japan-Chile TRQ) 
http://www.maff.go.jp/j/kokusai/boueki/triff/t_chl/04/index.html  (Japan-Thai TRQ) http://www.maff.go.jp/j/kokusai/boueki/triff/t_tha/04/index.html 
 
(Japan-Indonesia TRQ) http://www.maff.go.jp/j/kokusai/boueki/triff/t_idn/04/index.html  (Japan-Philipines TRQ) http://www.maff.go.jp/j/kokusai/boueki/triff/t_phl/04/index.html 
 
Add. 3  Q1. With relation to the subject food products to obligatory labeling in accordance with the Norm 
of labeling of the quality for the food products modi fied genetically, applied since the 1o of January 
of the 2007, 
 (a) What information contains the label for you said products? (b) Which are the additional requirements of info rmation for the products included in the list 
[seven cultivations (beans of so y, corn, seeds of rape, potatos, seeds of cotton, alfalfa and 
beet) and 32 classes of food products (elaborate ch iefly based on beans of soy or corn, the 
sugar beet, the corn with highly contained of  lisina and the elaborate food products that 
contain it as main ingredient) for their labeling? 
(c) Which are the registered products in the lists? (d) Which are the international references (agreeme nts, norms and features) in the application of 
this type of labeling? 
(e) In the paragraph (65) dealing with quality labelling for genetically m odified foods, reference 
is made to the fact that imports of GM foods  that do not meet the safety requirements are not 
permitted.  This being the case, does the Japanes e authority call for safety information to be 
set out on the label or does the information requirement apply to the accompanying documentation, independently of the information on the label?  WT/TPR/M/211/Add.1 
 Page 277 
 
 
  A. 
(a) Please refer to the following website for details:   http://www.maff.go.jp/soshiki/syokuhi n/hinshitu/e_label/Lalel-GMO.htm 
 (b) and (c)  Please refer to the attached table 1, 2 and 3 on the following website:  
 http://www.maff.go.jp/soshiki/syokuhin/ hinshitu/e_label/file/Labeling/QLS_GMO.pdf 
 (d) There are no international standard references.  (e) Under the Food Sanitation Law, genetically modified foods can be marketed only when their 
safety has been authorized, and they must be  labeled when they are used as foods. 
 In Japan, there is no obligation to label foods with information on their inocuity.  At the time of import notification, based on Artic le 27 of the Food Sanitation Law, the Quarantine 
Stations of the Ministry of Health, Labour and Welfare do not require that the packages bear a label 
of genetically modified foods nor notification of inocuity. 
 
Q2. Paragraph 34 of the document indicates that the sy stem of prior confirmation is used to collect 
data on certain imports, to ensure that they are for specific uses, and to verify documentation and 
origin requirements, particularly in respect of cer tain substances listed in Annex E of the Montreal 
Protocol.  On what basis are only certain substances in Annex E of the Montreal Protocol covered by 
this system?  Are the other annexes of the Montreal Protocol  excluded from the import surveillance system? 
 A. What is described in page 42 of the report is merely an example.  The substances listed in the 
Annex of the Montreal Protocol on Substances that Deplete the Ozone Layer that are subject to prior conformation are imports for the use that is allo wed to be an exceptional case in the protocol.  The 
details are as follows:   - when used as raw materials in the manufactur ing process of other substances, the substances 
listed in Annex A, B, C, and E of the Montreal Protocol 
- when used for testing and research or analysis,  the substances included in Group I of Annex 
A of the Montreal Protocol, and the substances listed in Annex B, C, and E of the Montreal Protocol. 
- when used for quarantine upon import and export of goods, the substances listed in E of the 
Montreal Protocol. 
 
Add. 4  Q1. In paragraph 9 of the report, it is stated th at:  "Various laws on intellectual property rights 
(IPRs) have been amended since Japan's previous  Review with a view to strengthening their 
protection (e.g. by increasing penalties for infringement)".  Could Japan confirm that these 
amendments have already been notified to the WTO?  
A. The industrial property acts (the Design Act,  the Patent Act, the Utility Model Act, and 
Trademark Act), and the Unfair Competition Preven tion Act were amended in  2006.  Through those 
amendments, the maximum term of impris onment and the cap of monetary penalty 
(including against 
juridical persons ) for industrial property rights and trade secret infringements were pulled up. 
 WT/TPR/M/211/Add.1 
Page 278  
 
  Additionally, taking account of increasing penalties fo r infringement of industrial property rights, 
penalties for copyright infringement were increased in 2006 and penalties for infringing on plant 
breeder's right or other rights infringement were  increased in 2007 through amendments to the 
Copyright Law and the Plant Variety Protection and the Seed Act respectively.  
Some of the Amended Acts have already been notified to WTO.  
Q2. Concerning sections III(2)(vii)(b) on sanitary and phytosanitary measures and III(2)(vii)(c) on 
labelling and packaging requirements,  set out on pages 49 and 50 of the report, could Japan elaborate 
on its description of the changes implemented for th e adoption of sanitary measures, for example in 
respect of milk powder, meat, fish, etc. 
 
A. The recent revisions of regulations re garding sanitary and phytosanitary measures and 
labeling and packaging requirements have been notifie d as SPS or TBT notifications, so Japan would 
like you to refer Mexico to those notific ations for details of the revisions. 
 
If Mexico has any additional questions or requires any further details regarding individual matters, 
please contact the relevant authority th rough the Mexican Embassy in Japan. 
 
Q3. Could Japan provide details of promotional me asures taken since its last Review, whether for 
purposes of foreign trade or in the domestic context? 
 
A. The import promotion measures by the Japan External Trade Organization (JETRO) and 
foreign access zones (FAZs) had already been abolishe d at the time of the previous review.  However, 
such measures by MIPRO still remain.  
Regarding the export promotion, for instance, J apan provides export credits based on the terms and 
condition of the "OECD Arrangement  on Officially Supported Export C redit."  With regard to export 
finance, please refer to the JBIC website (http:/ /www.jbic.go.jp/en/finance/export/index.html) for 
more information.  With regard to export in surance, please refer to the NEXI website  
(http://www.nexi.go.jp/e/ps/index2_f rame.html) for more information.  WT/TPR/M/211/Add.1 
 Page 279 
 
 
  ADDITIONAL REPLIES PROVIDED BY JAPAN 
 
TURKEY  
 
Q1. Could Japan please explain domestic support it has provide to various sector in face of the 
economic crisis if there is any?  
 
A. Japan began formulating three economic poli cy packages in August 2008 in order to respond 
to the current financial situation.  Please refer to websites below. 
 
"Immediate Policy Package to Safeguard People's Daily Lives" 
http://www5.cao.go.jp/keizai1/2008/081224summary-english.pdf  "Economic Policy Package: Measures to Support People's Daily Lives" http://www5.cao.go.jp/keizai1/2008/081201outline-english.pdf 
 
"Comprehensive Immediate Policy Pack age – Easing Public Anxiety" 
http://www5.cao.go.jp/keizai1/2 008/0918summary-english.pdf 
 
Q2. The Secretariat's report includes the table (T able III.4) concerning various standards and 
technical regulations.  As specified at the table, ther e exists a Building Standard Law.  In this respect;  
Could Japan explain whether this Law also consis ts of standards for the importation of building 
materials?  If not, is there a seperate regulation for this purpose?  
A. The Building Standard Law does not contain standards for the importation of building 
materials.  There are no laws or regulations excl usively pertaining to the importation of building 
materials.  
Q3. Could Japan kindly elaborate on the SSG measures in 2009?  
A. The SSG measures will be applied by Japan in  line with Article 5 of the Agreement of 
Agriculture and the Temporary Tar iff Measures Law in 2009, as was the case in previous years. 
 
 CHINA ADD.1
 
 Q1. With regard to Table II.1 on Page 17, woul d the Delegation of Japan please provide copies of 
the following legislations or their summaries in E nglish, or indicate their reference numbers if they 
have been notified to the WTO?   1) The Export and Import Transaction Law (1952 Law No. 299, 2007 amendment), Export 
Control Order (1949 Order No. 378, 2007 amendment), Import Trade Control Order (1949 
Order 414, 2003 amendment), Cabinet Order on Inward Direct Investment (1980 Order No. 
261, 2007 amendment)  
2) The Act on Special Measures Concerning the Ha ndling of Legal Servi ces by Foreign Lawyers 
(1986 Order No. 66, 2003 amendment) 
3) Access to the International Trade Insu rance Law (1950 Law No. 67, 2008 amendment) 
4) The Design Act (1959 Law No. 125, 2007 amendment)  
 
A. Based on the Translation Development Program  (Chapter II. Paragraph 15 on page 20 
Fn. 10), Japan provides English translations of la ws and regulations online.  The translations are 
available on the Cabinet Secretariat’s Website (h ttp://www.cas.go.jp/jp/seisaku/hourei/data1.html).  
 WT/TPR/M/211/Add.1 
Page 280  
 
  At present, the following translations are available on the website. 
 
 Laws and regulations Sectio ns available on the website 
1) Export and Import Transaction Law (1952 Law No. 299, 
2007 amendment) Not available 
 Export Control Order (1949 Order No. 378, 2007 
amendment) Export Trade Control Order (1949 Order No. 378, revisions of 
Cabinet Order No. 304 of 2006 (Effective 1 January 2007)) 
 Import Trade Control Order (1949 Order 414, 2003 
amendment) Import Trade Control Order (1949 Order 414, revisions of Cabinet 
Order No. 284 of 2003 (Effective 6 June 2003)) 
 Cabinet Order on Inward Direct Investment (1980 Order 
No. 261, 2007 amendment)  Cabinet Order on Inward Direct Investment (1980 Order No. 261, 
revisions of Cabinet Order No. 42 of 2006 (Effective 1 May 2006)) 
2)  Act on Special Measures Concerning the Handling of Legal 
Services by Foreign Lawyers (1986 Order No. 66, 2003 
amendment) The Act on Special Measures Concerning the Handling of Legal 
Services by Foreign Lawyers (1986 Act  No. 66, revisions of Act 
No. 128 of 2003 (Effective 1 April 2004)) 
3) Access to the International Trade Insurance Law (1950 Law 
No. 67, 2008 amendment) Not available 
4) Design Act (1959 Law No. 125, 2007 amendment)  The De sign Act (1959 Act No. 125, revisions of Act No. 55 of 
2006 (Effective 1 April 2007)) 
 
Q2. How does Japan plan to provide more mark et access on these products, particularly on those 
of export interests to developing Members?  
A. Japan takes into account the situations of ea ch domestic industry to set an appropriate level 
of tariff on each product that is consistent with WTO Agreements.  Japan will continue to engage in 
discussion in the DDA negotiations in a constructive manner. 
 
Q3. China would like to know how quotas are allocated in Japan on the basis of MFN principle? Please provide detailed explanations using rice as an example.  
A. Rice import tenders are conducted following the consideration of market information such as 
domestic demand, export countries’ su pply capacity and so forth.   
 
Q4. Would the Delegation of Japan please provide the latest information regarding the evaluation 
process?  
A. The Food Safety Commission (FSC) is a risk assessment organization which is independent 
from the risk management organizations of the Ministry of Health, Labour and Welfare (MHLW) and 
Ministry of Agriculture, Forestry and Fisheries  (MAFF).  The MHLW is responsible for setting 
residue limits on positive list items such as pesticid es according to the results  of risk assessments. 
 As for positive list items, the MHLW has requested  risk assessments for 257 items, and the FSC has 
performed assessment on 104 ite ms as of 10 February 2009. 
 
 
  WT/TPR/M/211/Add.1 
 Page 281 
 
 
  Flow of Assessment / Risk Communication
Risk Management Agencies
Risk Assessment Requests
Information Exchange 
Meetings as NecessaryHearing of Assessment Request Reasons
Deliberation in Export Committee
Collation of Deliberation Findings / Creation of Assessment Report (Draft)
Collection of Public Opinion and Information (Normally 30 Days)
Deliberation in Export Committee as Necessary
Deliberation / Assessment Findings Decisions
Risk Management AgenciesNotification of Assessment Findings
 
 
 Q5. Would the Delegation of Japan please explain the rationale for such a disparity in the  
maximum residue limits of the two products?  
How does Japan justify its compliance w ith the SPS Agreement in this regard? 
 
A. Japan's residue standards for pesticides in foods have been established according the residue 
data available in Japan and in foreign countries.  Thus, the standards vary from crop to crop and 
depend on residue amounts.  
When finalizing these standards, Japan notifies them to the WTO in accordance with the WTO/SPS 
Agreement and seeks comments from member countri es.  Japan observes international procedures 
when setting regulations. 
 
Q6. Would the delegation of Japan please explain ho w these requirements are in consistency with 
the national treatment principle?  
 WT/TPR/M/211/Add.1 
Page 282  
 
  A. For domestic violations, Japan does not ap ply the same inspection system as it does for 
import food, because Japan's MRL c ontrol measures are enforced by law.  Furthermore, measures 
such as "Mandatory inspection" are not necessary because local government s investigate causes for 
every individual violation and take corrective action immediately. 
 Q7. Could the Delegation of Japan please indicate wh ether they plan to publicize the draft of the 
law and solicit opinions from relevant enterprises and in terested parties before enactment in order to 
avoid the possible disturbance to trade brought by the new system?  
A. Japan made a request for public comments on the draft report that pointed out that the 
Chemical Management Policy Law (Act on the Eval uation of Chemical Substances and Regulation of 
Their Manufacture, etc.) should be revised, for about one month at the end of 2008.  Japan revised the 
draft based on the comments, and the revised dra ft as well as the comments are available on the 
following website:  http://www.me ti.go.jp/press/20081222004/ 20081222004.html. 
 Q8. What kind of measures has this organization adopted to promote services trade?  
 
A. JETRO provides general information in res ponse to inquiries from companies or individuals 
concerning services trade. 
 
Q9. Would the Delegation of Japan please provide  detailed information regarding these measures 
of the regulatory reform concerning the services sectors? 
 
A. The latest revised "Three–Year Plan for th e Promotion of Regulatory Reform" issued in 
March 2008, covers over 750 measures, which include  the following:  For the medical and nursing 
services sector, further advancemen t of medical services is expected through the utilization of 
information technology, such as improving the qua lity of reviews on detailed reports of medical 
charges.  For the financial sector, firewall regul ations between banking and securities businesses, 
such as lifting the ban on interlocking officers and empl oyees, will be revamped.  For the labor and 
employment sector, reconsideration of the prerequi sites for the examination for certification in 
childcare as well as the overall training program w ill be examined.  For the education sector, the 
distribution rule of public funds to universities w ill be reconsidered in order to improve the quality of 
education and research.  
Q10. Would the Delegation of Japan please provide the following information about this organization?  
1) Objective for setting up this organization; 
2) Functions of this organization; 3) Coordination of SPRING with services authorities.  
A.1) The objective for setting up this organizati on is to support the resolution of the various 
problems which the service industry is facing.  For the purpose of supporting dynamic growth 
in the service industry by increasing the level of productivity and innovation, the organization 
provides information on innovative management tools, offers of opportunities for effective 
knowledge sharing and support for the i ndependent actions of private firms.  
 2) For the resolution of the various problems in  the service industry, the organization assumes 
the role and responsibilities for providing a pl atform where highly experienced and deeply 
knowledgeable experts with high aspirations from private, academic and public sectors 
gather for discussion.  
  WT/TPR/M/211/Add.1 
 Page 283 
 
 
  3) The Ministry of Economy, Trade and Industry and other relevant government agencies are 
working with SPRING as observers.  Experts from public, academic and public sectors have been discussing SPRING’s activities and sharing information on improving productivity in 
the service industry. 
 Q11. Please explain the meaning of "subject to the compulsory coverage by the Government". 
Please explain the rationale behind this requirement. Is there any plan to change this requirement? 
 
A. There is no such reservation in Japan's revised offer.  
 Q12. Please explain what this limitation spec ifically means and the rationale behind it. 
 
A. There is no such reservation in Japan's revised offer. 
 
Q13. Does Japan have any plan to improve its visa ad ministration with regard to short-term stay in 
the spirit of promoting the liberalization of trade in services? 
 
A. In order to facilitate visa issuance to Chinese business persons, Japan pro-actively reviewed 
its visa policy in May 2008.  Under the new po licy, Chinese business persons whose companies have 
continual transactions with Japanese compani es listed on the Japanese stock exchange, and who 
intend to stay in Japan for no more than 90 da ys without conducting remunerative activities became 
eligible to apply for multiple entry visas valid for 1–5 years.  Therefore, Chinese business persons 
who meet the requirements above do not need to apply fo r a single entry visa each time they enter into 
Japan if they have multiple entry visas.  Furthermore, to make the visa  process more transparent, convenient, and foreseeable, Japan 
publicized its Criteria of Visa Issuance on the website of the Ministry of Foreign Affairs of Japan as 
well as set the average processing period as five wo rking days after accepting the visa application at 
Japanese Embassies or Consulates.  
 
Q14. China would like to know what exact measure s Japan has taken to encourage competition in 
the financial services sector including insurance, given that the FDI level in this sector in Japan is still 
low and the number of foreign service-providers in the life insurance sector is still limited. 
 
A. There are no limitations to foreign investment  in the Japanese insurance market.  There are 
46 life insurance companies, including 4 foreign life in surance companies in the form of branches and 
13 foreign life insurance companies in the form of locally-incorporated companies in Japan.  There 
are also 51 non-life insurance companies, including 21 foreign non-life insurance companies in the 
form of branches and 4 foreign non-life insurance companies in the form of locally-incorporated 
companies.  Therefore, Japan has ensured that  the Japanese insurance markets are liberalized 
competitive markets.  In addition, in the Plan for Strengthening the Competitiveness of Japan's 
Financial and Capital Markets, aiming for the d evelopment of urban infrastructure suitable for an 
international financial center, Japan has promoted the construction of an urban environment where 
both domestic and international players can take active roles in the markets safely and comfortably.  
Q15-1,15-2. China would like to know the expected ro le of the new Japan Post Insurance Company in 
the insurance sector and whether the new company w ould enjoy de facto advantageous status, given 
the special status of the Japan Po st Insurance. Ltd as a fully owned entity by the Japan Post Holdings, 
a fully state-owned holding company. 
 Also, China wonders if Japan Post Insurance would operate as an insurance intermediary as well.  If 
so, would foreign insurers be able to have access to Japan Post Insurance as insurance agents or 
distribution channels for their products? WT/TPR/M/211/Add.1 
Page 284  
 
  A. Japan Post Insurance (JPI) started its business as a corporation which inherited the function 
of Japan Post's postal life insurance when Japan Post was privatized.  Under the Law of the 
Privatization of Postal Services, Japan Post Holdings is  obliged to dispose of all of the shares it holds 
in Japan Post Insurance no later than 30 September 2017.  
JPI is subject to the same laws and regulations applied to private insurance companies including the 
Insurance Business Law, as JPI was established as an insurance company under said law.  In 
addition, the Law of the Privatization of Postal Services imposes business restrictions on JPI during 
the privatization transition period.  Insurance polic ies taken after privatization are no longer subject 
to government guarantee and, as with other life insurance policies, are protected under the life 
insurance policyholders protection system. 
 JPI needs to obtain approval under the Law of the Privatization of Postal Services as well as under 
the Insurance Business Law when it represents businesses or carries out services on behalf of other 
insurance companies including foreign insurers.  Th e Prime Minister and the Minister for Internal 
Affairs and Communications approved JPI's bro kerage of corporate insurance products in 
April 2008, and JPI has been selling insurance products of other insurance companies including 
foreign-affiliated insurers since June 2008. 
 
Q16. China would like to know whether foreign ser vice-providers would be treated equally as their 
domestic counterparts under such measures. 
 
A. Foreign insurance companies and Japanese domest ic insurance companies have been treated 
equally with respect to allowing banks to sell a ll insurance products over the counter and lifting the 
ban on insurance companies conducting agent business.   
Japan has maintained non-discriminatory treatment through said measures.  
 
Q17. Would the Delegation of Japan please give its views on the reason of the decrease of trade volume in the insurance service sector?  
A. The Financial Services Agency does not anal yze or research the trade volume of the 
insurance market and does not know th e specific reason for its decrease. 
 
Q18. Would the Delegation of Japan please describe how the current financial and economic crisis 
has affected the Japanese economy?  
What measures has the Japanese Government taken in face of it? 
 
A. The Japanese economy is worsening rapidly:  
 - Exports and Industrial producti on are decreasing substantially.  
- Corporate profits are falling sharply and business investment is decreasing.  
- The employment situation is worsening rapidly.  
- Private consumption has decreased recently.  
 
In terms of short-term prospects, the Japanese ec onomy is likely to continue worsening for the time 
being, and the rapid reduction of  production might require a sign ificant employment adjustment. 
Attention must be given to the possibility that  the economy may lag even more due to the worsening 
global financial crisis, concerns over further slowdo wn in overseas economies and the effects of high 
volatility in stock and foreign exchange markets.    WT/TPR/M/211/Add.1 
 Page 285 
 
 
  Since August 2008, Japan has been formulating three economic policy packages in face of the current 
economic and financial situation.  Please refer to the websites below for more information. 
 "Immediate Policy Package to Safeguard People's Daily Lives" http://www5.cao.go.jp/keizai1/2008/081224summary-english.pdf 
 
"Measures to Support People's Daily Lives" http://www5.cao.go.jp/keizai1/2008/081201outline-english.pdf  "Comprehensive Immediate Policy Package" 
http://www5.cao.go.jp/keizai1/2 008/0918summary-english.pdf 
  ECUADOR
 
 Q1. Could Japan provide more detail on the objectiv e sought to be achieved by this measure? 
 
A. The objective of the reform is to encourage the efficient utilization of farmland through the 
promotion of farmland leases Japan envisages that these leases will enlarge the operational scale of 
core farmers and accelerate the merging and grou ping of farmlands and restoration of abandoned 
farmland.  
Q2. What is a current status of this initiative?  
A. On announcing  the "Development Initiative fo r Trade" in 2005, Japa n has pledged, inter 
alia, financial assistance of 10 billion USD and dis patching and accepting a total of ten thousand 
experts and trainees respectively over the course of  the following three years, as well as the 
implementation of Duty-Free Quota-Free market access for essentially all products originating from 
LDCs.  The amount of financial assistance for developing countries in 2006 and 2007 was 4.6 billion USD 
and 4.4 billion USD respectively, making it virtually certain that the 10 billion mark will be surpassed 
during the third year.  In terms of experts and trainees, there were 2003 experts dispatched from Japan to developing countries and Japan has accepted 11,482 trainees from those countries in 2006.  There were also 
2,578 experts dispatched from Japan to developi ng countries and Japan has accepted 14,780 trainees 
from those countries in 2007.  As for the Duty-Free Quota-Free market acc ess for goods from LDCs, Japan has already 
implemented it for approximately 98% of products originating there as from 1 April 2007.  As a 
result, Imports from LDCs increased by 5.4% in 20 07, and increased by 30.9% in 2008, compared to 
the same period of 2006 (April-December) respectively. 
 Japan will inform WTO Members of results of the Initiative at AFT review meetings which are scheduled for later this year. 
 Q3. What are these sensitive industrial products?  Is  there a website on which this information is 
available?  
A. Japan's GSP (Generalized System of Preferen ces) applies reduced tariffs to designated 
import goods originating from  developing countries or territories, w ith the aim to help them increase 
export income, advance industrializatio n and promote economic development. WT/TPR/M/211/Add.1 
Page 286  
 
  In regard to industrial products, a ll industrial products are in principle given duty-free treatment, 
with the exception of some products (ceiling system- applied items) designated as special in light of 
domestic industrial conditions.  Please refer to the following website for inform ation on Japan's GSP (Generalized System of 
Preferences) http://www.customs.go.jp /english/c-answer_e/pdf/FAX1501e.pdf. 
 
Q4. What is the procedure for establishing the specified ceilings?    
A. Under Japan's current GSP scheme, which is effective until 31 March 2011, ceilings based on 
the Temporary Tariff Measures Law are provided as follows: the ceiling for FY2001 was established 
as 103% of the preferential import value or vo lume of a product in FY1999.  Since FY2002, the 
ceiling has been increased each year by 3% of the previous year's limit. 
 
Q5. Please provide more information concerning the ru les of origin that have to be fulfilled to 
meet Japan's GSP requirements.  Is there a website where this information can be found? 
 
A. For detailed information in English on Rules of Origin under Japan's Generalized System of 
Preferences, please refer to the website  of the Ministry of Foreign Affairs. 
http://www.mofa.go.jp/policy/economy/gsp/index.html 
 Q6. Could Japan provide more information about the functioning of the Common Portal for the 
Next Generation Single Window and the reorganization of processes necessary for its implementation?  
A. Japan Customs has been developing the Single Window system in Japan, in which 
information and communication technology in co- operative arrangements be tween Customs and other 
border agencies (Ministry of Justice;  Ministry of  Land, Infrastructure and Transport;  Ministry of 
Agriculture, Forestry and Fisheries;  Ministry of Eco nomy, Trade, and Industry;  Ministry of Health, 
Labor and Welfare) to enable all the parties in  an import/export and vessel clearance transaction to 
use a Single Electronic Window.  Through this wi ndow, relevant official boarder agencies can share 
prescribed control data and provide traders with a streamlined "one stop shop" release/clearance 
processing system. 
 The border agencies concerned have been jointly developing the Common Portal, which is the portal 
for the "Single Window," which was introduced in October 2008. 
 
The portal has unified applicant ID systems, el ectronic application process and data input processes 
all of which previously had different specifications  among the agencies concerned.  The portal has 
also enabled data-sharing among the agencies c oncerned, and helped applicants to save work by 
allowing them to reuse basic information they ha ve submitted to the Common Portal.  Furthermore, 
these highly convenient services are provid ed through a user-friendly interface. 
 Q7. Is there a connection between implementation of the Common Portal for the Next Generation 
Single Window and the proposal by Korea whic h is being discussed in the Trade Facilitation 
Negotiating Group?  
A. The single-window service (Common Portal) has unified applicant ID systems, electronic 
application processes and data input processes among d ifferent government agencies.  The portal has 
also enabled data-sharing among the agencies concerned, and he lps applicants to save work by 
reusing basic information submitted to the Common Portal.    WT/TPR/M/211/Add.1 
 Page 287 
 
 
  Korea's proposal on the establishment of a single window system has been discussed within the Trade 
Facilitation Negotiation Group (TFNG) meeting.  In  our view, Korea's proposal will probably be 
revised in due course to reflect member comments  posted during the TFNG meeting.  Therefore it is 
difficult to conclude whether or not Japan's Common Portal corresponds to Korea’s proposal at this 
stage. 
 
Q8. To which tariff subheadings does this apply, and in particular on which agricultural and fish 
products is there a tariff above the bound rate and by what amount does it exceed the bound rate, 
based on the WTO principle of transparency?  A. Some of Japan's bound rates exceed its applied MFN rates, as described in the Secretariat report. Please refer to Japan's Schedule on the Japan Customs website for further details. 
http://www.customs.go.jp/english/tariff/2008_4/index.htm 
 
Q9. Please provide details of the way in which quota allocation operates and the existence of any 
initiatives to amend the system. 
 
A. Japan is convinced that it is conducting the administration of tariff quotas in a fair and 
transparent manner, appropriate to the characteristics of each product. 
 Therefore, Japan has no concrete plan to change the existing quota allocation method. 
 
Q10. What are the factors governing the app lication of those prohibitions and quantitative 
restrictions and to which subheadings do they ap ply, so as to ensure that they do not possibly 
constitute a restraint of trade pursuant to Article XI.1 of the GATT?  A. The items which are subject to the import quotas  are, as described on page 42 of the report, 
the specific marine products (they are eight items  at the HS classification 4-digit level) and the 
substances listed in an Annex of the Montreal Prot ocol on Substances that Deplete the Ozone Layer. 
This control is based on the Foreign Exchange and Foreign Trading Act.  The import quota system of our country serves the impor tant functions of conserving and managing of 
fishery resources in waters adjacent to Japan an d observing the treaties whic h Japan has concluded. 
Moreover, this system is based on the WTO Agreeme nt.  Please refer to the following website for a list 
of tariff lines (http://www.cas.go.jp/jp/seisaku/hourei/data/ITCO.pdf). 
 
Q11. What are those products and what is the ru le governing the establishment of import quotas? 
 
A. Import quota allocations have been established for the following products in accordance with 
Article 3 of the Import Trade Control Order and the Foreign Exchange and Foreign Trade Act. ("Ex" 
indicates that only a part of the item is covered by import quota allocations.)   HS No.  Description of Goods 
 ex 03.01    Herring, Cod, Yellow tail, Mackerel, Sardine, Horsemackerel,  
 ex 03.02    Saury, roes of Cod and Niboshi (small boiled and dried fish       for seasoning), live, fresh, ch illed, frozen, dried, salted or in brine 
 ex 03.03     ex 03.04    
 ex 03.05    
 ex 03.07  Scallops, adductors of shell-fish, cuttlefish and squid    (excluding "Mongo ika")  ex 12.12    Edible seaweeds and its preparations   ex 21.06    WT/TPR/M/211/Add.1 
Page 288  
 
  Q12. What is the basis for the assertion that about  53% of JIS are comparable to international 
standards?  
A. At the end of FY2007, Japan had 10,064 JIS items and 5,147 of them were comparable to 
International Standards.  The ratio of standards  comparable to the international standards is 
approximately 53%.  
Q13. What procedure must be followed by a fore ign enterprise in order to be certified as an 
ROCB?  A. The outline of the procedure fo r registration is as follows: 
 Step 1: Submit an application form to the Mini ster of the Ministry of Agriculture, Forestry and 
Fisheries (MAFF). 
Step 2: After MAFF confirms the submission of  the required documents and the payment of the 
registration fee and registration license tax, th e Incorporated Administrative Agency, the 
Food and Agricultural Materials Inspection Ce nter (hereafter as to "FAMIC"), carries out 
documentary examination and on-site inspection in  order to decide whether the applicant 
conforms to registration criteria.  FAMIC th en reports the result of the examination to the 
Minister of MAFF. 
Step 3: If FAMIC reports that the applicant conf orms to registration criteria and the MAFF confirms 
the report, the applicant will be registere d as an ROCB by the Minister of MAFF. 
 
Q14. Concerning ceramic and enamel ed equipment, and utensils and containers used for food, what 
levels of cadmium and lead are currently permitted?  A. The revised specifications by material categor ies and testing methods are as shown in the 
appendix, which is in English. 
 
Appendix  
 Following text is a provisional translation of an excerpt from "Standards and specifications for food, 
food additives etc.", the Announcement No. 370 of the Ministry of Health and Welfare (1959), 
reflected The 31st July 2008 revision  Glass, ceramic or enameled equipments and contai ners shall meet the requirements when tested by 
the following methods.  
I. Test sample whose depth is 2.5 cm or deeper when filled with liquid - excluding enameled 
ones with the capacity*1 of 3 L and over -  (1) Preparation of test solution   After washing the test sample well with water, fill it with 4% acetic acid solution*2, and leave 
it at ordinary temperature*3 in a dark place fo r 24 hours.  Transfer this solution into a 
beaker, and use it as the test solution.  
(2) Migration test for Cadmium and lead  
 a) Generation of calibration curves    Dilute Cadmium Standard Solution and Le ad Standard Solution with 4% acetic acid 
into appropriate concentrations, determine the concentrations by atomic absorption 
spectrophotometry or inductively coupled pl asma atomic emission spectrometry, and 
generate respective calibration curves.  
 b) Quantification method    When the concentrations of cadmium and lead leached in the test solution are 
determined by atomic absorption spectr ophotometry or inductively coupled plasma 
atomic emission spectrometry, the amount le ached per unit area shall be equal to or  WT/TPR/M/211/Add.1 
 Page 289 
 
 
  less than the limits given in Columns 2 for cadmium and Column 3 for lead, for 
corresponding category given in Column 1 of the following table. 
 
Column 1  Column 2 Column 3 
Heat-cooking ware  0.05 μg/ml 0.5 μg/ml 
Capacity less than 600 ml 0.5 μg/ml 1.5 μg/ml 
Capacity 600 ml and over and less 
than 3 L  0.25 μg/ml 0.75 μg/ml Glass equipment and 
containers  Those other than heat-
cooking ware  
Capacity 3 L and over  0.25 μg/ml 0.5 μg/ml 
Heat-cooking ware  0.05 μg/ml 0.5 μg/ml 
Capacity less than 1.1 L  0.5 μg/ml 2 μg/ml 
Capacity 1.1 L and over and less 
than 3 L  0.25 μg/ml 1 μg/ml Ceramic equipment and 
containers  Those other than heat-
cooking ware  
Capacity 3 L and over  0.25 μg/ml 0.5 μg/ml 
Heat-cooking ware whose capacity is less than 3 L  0.07 μg/ml 0.4 μg/ml Enameled equipment 
and containers  Those other than heat-cooking ware whose capacity is less than 
3 L  0.07 μg/ml 0.8 μg/ml 
 
II. Test sample that cannot be filled with liquid, or test sample whose depth is less than 2.5 cm 
when filled with liquid, or enameled test sample with the capacity of 3 L and over -  
(1) Preparation of test solutions   After washing the test sample (for enameled  products with the capacity of 3 L and over, 
prepare flat pieces of the test sample and use it as test sample) well with water, leave it at 
ordinary temperature in a dark place for 24 hours using 4% acetic acid solution as solution 
for simmering.  
(2) Migration test for Cadmium and lead  
 a) Generation of calibration curves    Dilute Cadmium Standard Solution and Le ad Standard Solution with 4% acetic acid 
into appropriate concentrations, determine the concentrations by atomic absorption 
spectrophotometry or inductively coupled pl asma atomic emission spectrometry, and 
generate respective calibration curves.  
 b) Quantification method    Determine the concentration (C μg/ml) of cadmium and lead respectively in the test 
solution by atomic absorption spectrophot ometry or inductively coupled plasma 
atomic emission spectrometry. Obtain the amount of migration per unit area for each 
element by the formula given below, in wh ich the surface area of the sample product 
is expressed as S (cm2) and the total volume of the solution used to elute the element 
as V (ml). The amount leached per unit area shall be equal to or less than the limits 
given in Columns 2 for cadmium and Colu mn 3 for lead, for corresponding category 
given in Column 1 of the following table.  
 
Amount of migration per unit area ( μg/cm2) = (C×V)/S  
 
Column 1  Column 2 Column 3 
Glass equipment and containers  0.7 μg/cm2 8 μg/cm2 
Ceramic equipment and containers  0.7 μg/cm2 8 μg/cm2 
Heat-cooking ware  0.5 μg/cm2 1 μg/cm2 Those that cannot be filled 
with liquid, or those whose 
depth is less than 2.5 cm 
when filled with liquid  Products other than heat-
cooking ware  0.7 μg/cm2 8 μg/cm2 Enameled equipment and 
containers  
Those whose depth is 2.5 cm or deeper when filled with 
liquid and have the capacity of 3 L or over  0.5 μg/cm2 1 μg/cm2 
 WT/TPR/M/211/Add.1 
Page 290  
 
  (Notes by translator)  
*1: By "capacity", internal capacity is meant.  *2: By "solution", aqueous solution is meant.  *3: By "ordinary temperature", 15 degrees Celsius to  25 degrees Celsius is meant, as it is in the 
Japanese Pharmacopoeia. 
 
Q15. What basis would this new law have for revi sing the permissible levels of cadmium and lead 
in the above-mentioned products?  
A. On 31 July 2008, the Ministry of Health, Labour and Welfare (MHLW) revised the migration 
specifications for lead and cadmium in glass, cera mic, or enameled equipment and containers that 
come into contact with food.   The amendment specifies the adoption of the followi ng International Organization for Standardization 
(ISO) standards:  ISO4531 for vitreous and po rcelain enameled products;  ISO6486 for ceramic 
ware, glass-ceramic ware and glass dinnerw are; and ISO7086 for glass hollowware. 
 
Q16. Please provide more information concerning th e procedure and the requirements that have to 
be satisfied by official inspection bodies in the expor ting country in order to benefit from this facility. 
 
A. The test results obtained by the exporting coun try may be attached to the import notification 
forms at the point of entry.  In the case that importers conduct tests voluntarily or following 
administrative consultation, these tests may be done  at the Ministry of Health, Labour and Welfare 
(MHLW) registered overseas labo ratories.  This scheme does not cover such items as bacteria and 
mycotoxins, as the state of these items is  liable to change during transportation.  
 
To be registered with the MHLW, laboratories mu st be capable of conducting tests using AOAC 
methods approved by the AOAC International, or be capable of using equivalent methods, and be 
either of the following:  Laboratories under the direct control of the nationa l or state government of the exporting country 
(official laboratories) 
 
Laboratories certified or designated by the nationa l or state government of the exporting country 
(designated laboratories). 
 
Q17. Is there an official Japanese website whic h sets out the labelling requirements applicable to 
foods? 
 
A. Please refer to the following website for information on food labeling based on the JAS law: 
http://www.maff.go.jp/soshiki/syok uhin/hinshitu/e_label/index.htm  
 All genetically modified foods to be marketed in Japan are subject to labeling requirements under the 
Food Sanitation Law. 
 Please refer to the following websites for informatio n regarding national regulations on the labeling 
of food derived from biotechnology, as specified in the Food Sanitation Law. http://www.jetro.go.jp/en/marke t/regulations/pdf/food-e.pdf 
http://www.mhlw.go.jp/english/topics/qa/gm-food/gm1.html  
Q18. With which registered certifying bodies does Japan cooperate?   WT/TPR/M/211/Add.1 
 Page 291 
 
 
  A. The list of Registered Overseas Certifying Bodi es for organic foods is as follows as of  
February 2009:  - Australian Certified Organic - BCS Oeko-Garantie GmbH 
- Control Union Certifications 
- CERES, CERtification of Environmental Standards, GmbH - Institute for Marketocology, IMO - Istituto per la Certificazione Etica e Ambientale - CCPB-SRL 
- Bioagricert Srl 
- Global Organic Alliance, Inc. - BioGro New Zealand ltd - AsureQuality Limited - I.M.C. (Instituto Mediterraneo di Certificazione) 
- Canadian Seed Institute (CSI) 
 In addition, there are about 60 domestic Re gistered Certifying Bodies in Japan. 
 
Q19. What criteria are applied by Japan to determ ine obligatory inclusion status for only the first 
seven above-mentioned products, rather than all 25 of the products covered by the Food Sanitation 
Law? 
 
A. It is important that information be provid ed to allow allergic pa tients to make informed 
decisions about what food he/she should eat, taking into account which foods contain allergens to which he/she reacts.  When setting standards co ncerning specified ingredients in foods for the 
"Ingredient labeling for foods containing allergens" regulation, Japan gave due consideration to the 
fact that the severity and frequency of allergic ca ses differ, and therefore, ingredients were separated 
into two categories:  "mandatory labeling" by ministerial ordinance and "labeling recommended" by 
notice.   The former category, "mandatory labeling" by mi nisterial ordinance, consists of seven items: 
shrimp/prawn, crab, wheat, buckwheat, eggs, m ilk and peanuts.  The latter category, "labeling 
recommended" by notice, consists of 18 items: abalone, squid, salmon roe, shrimp/prawn, oranges, 
crab, kiwifruit, beef, tree nuts, salmon, ma ckerel, soybeans, chicken, bananas, pork, "Matsutake" 
mushrooms, peaches, yams, apples and gelatine. 
 Q20. Could Japan provide more information a bout the import promotion programmes that are 
currently being implemented?  
A. The import promotion measures of Japan External Trade Organization (JETRO) and foreign 
access zones (FAZs) were already abolished at the point of the previous review.  The measures of MIPRO still exist. 
 
Q21. What is the content of the programmes concer ned, particularly those relating to agriculture 
and fisheries?  Q22. What actions are being take n or are planned in the future to eliminate these discriminatory 
regimes in accordance with the provisions of Artic le XVI, Section B, paragraphs 3 and 4 of the 
GATT 1994?  
A.  Japan has no export subsidies for agricultural and fishery products. 
 WT/TPR/M/211/Add.1 
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  Q23. What exemptions from regulations ar e applicable to the "special zones"? 
 
A. Special Zones for "Structural Reform" promote structural reforms in different areas by setting 
up special zones where regulatory exce ptions are established in acco rdance with the zones’ local 
characteristics, based on independe nt proposals by municipal bodies, private-sector enterprises, and 
so forth.  By publicizing successful examples of those reforms in special zones, structural reforms can 
be extended to the whole country, and the econom y of Japan as a whole can be stimulated.  
Regulatory exceptions in special zones cover many fields, for instance, e ducation, agriculture, 
forestry and fisheries, medical care, environment and industrial promotion, among others.  The 
typical example of a special zone is the one for Nigori-zake, "Doburoku."  In the special zone of 
"Doburoku," the regulation concerning the lo west manufactured amount of liquors (6k ℓ) is not 
applied to allow the farmers managing Farm Gues t Houses and Farmers' Restaurants to brew 
"Doburoku" sake, which is out of rice cultivated by the farmers themselves. 
 
Q24. Are there any initiatives to simplify quota allocations? 
 
A. TRQs are appropriately administered taking into  consideration the characteristics of each 
product.  The procedure for TRQs is reviewed annually . At the present time there is no plan to change 
the current procedure.   
MEXICO ADD.5
 
 
Q1. In the first section of Japan's report, "Overv iew of Japan's Economic Re lationships", under the 
heading "The Multilateral Trade System", paragraph 2,  it is stated that Japan has lowered technical 
barriers to trade.  Could Japan indicate how it c ontributed to this goal during the review period? 
 
A. In the face of the current economic and financ ial crisis, Japan has taken a firm stance against 
rising protectionism.  Japan has made a great contribution to the discussions held in the Summit on Financial Markets and World Economy and also in the APEC Economic Leaders' Meeting last November, in which World Leaders committed to refrain  within the next 12 months from raising new 
barriers to investment or to trade in goods an d services, imposing new export restrictions or 
implementing WTO inconsistent meas ures in all areas, including those that stimulate exports.  
 During the review period, Japan has been working rigorously towards the early conclusion of the 
DDA negotiations, which would certainly contribute to  the lowering of technical barriers to trade in 
the future. 
Q2. In Chapter III of the Secretariat report, "Trade Policies and Practices by Measure", 
paragraph 9 of the introduction, it is stated that "Various laws on intellectual property rights (IPRs) 
have been amended since Japan's previous Review  with a view to strengthening their protection 
(e.g. by increasing penalties for infringement)".  Coul d Japan confirm that the amendments introduced 
have been notified to the WTO, or provide details of which laws have been amended with a view to 
protecting intellectual property? 
 
A. Major IPR-related laws and regulations that  have been enacted or amended since 2006 for 
the purpose of strengthening protection are listed below.  Some of the amendments in 2006 have 
already been notified to the WTO.  
 
2006 1. Amendment to the Design Act and others. The industrial property acts (the Design Act, the Patent Act, the Utility Model Act, and the Trademark 
Act) and the Unfair Competition Prevention Act were amended.   WT/TPR/M/211/Add.1 
 Page 293 
 
 
  By these amendments, the maximu m term of the design right was extended and a subject for the 
protection of graphic images on a screen which are provid ed for the use in the operation of an article 
was enlarged in the Design Act.  In the Patent Act,  time restriction on the division of applications was 
relaxed.  In the Trademark Act, a mark that is used for retail services or wholesale services can be registered as a service mark. 
 
In industrial property acts, exporting was added to the definition of "working" or "use" of industrial 
property rights (patent right, utility model right, design right and trademark right) and exporting of a 
counterfeit product was incorporated into the in fringement of industrial property rights.  
 
Moreover, under the industrial property acts and the Unfair Competition Prevention Act, the 
maximum term of imprisonment and cap of moneta ry penalty (including against juridical person) for 
industrial property rights and trade secret infringement was pulled up.  2. Amendment to the Customs Law/Customs Tariff Law 
 - Establishment of procedures to consult with appointed IPR experts (e.g. IP lawyers) 
 - Expansion of the scope of customs enfo rcement to the exported goods infringing IPR 
(plant breeders' rights, patents, trademarks and others). 
 3. Amendment to the Copyright Law Reflecting the increase of penalties for infringeme nt of industrial property rights, penalties for 
copyright infringement were also increased. 
 In addition, the Copyright Law was amended to  prevent the exportation of pirated goods. 
 2007 
1. Amendment to the Act on Special Measures Concerning the Recovery of Industrial Vitality 
A specific non-exclusive license registration system  was established for licensees' protection for 
certain kinds of comprehensive non-exclusive licenses c oncerning patent rights or utility model rights. 
Under this system, once a non-exclusive license grant ed by the "comprehensi ve license agreement" 
has been registered in the JP O, the licensee may assert the lic ense against anyone subsequently 
acquiring these patent rights or utility model rights. 
 
2. Amendment to the Patent Attorneys Law In order to maintain and enhance the quality of patent attorneys, a practical training system for 
people intending to be registered as patent atto rneys was introduced, in order to secure their 
capability in practice, such as the ability to prepar e actual application documen ts.  Registered patent 
attorneys are obliged to participate in periodi cal training concerning the latest laws and 
technological trends.  In addition, new kinds of disciplinary action were set out, the reasons thereof were defined, and 
"name-lending" was prohibited in order to clar ify the responsibilities of patent attorneys, whose 
qualification allows them exclusive business. 
 
The scope of patent attorneys' service was expanded so as to allow them to respond to the diversifying 
needs for their professional knowledge.   In order to contribute to better user choice among  patent attorneys, information concerning patent 
attorneys in the government or th e Japan Patent Attorneys Associa tion was made available to the 
public, and the provision of information by patent atto rneys themselves was promoted. 
 WT/TPR/M/211/Add.1 
Page 294  
 
  3. Amendment to the Customs Law 
Expanding the scope of Customs enforcement of ex ported goods infringing,copyrights and related 
rights.  4. Amendment to the Plant Variety Protection and Seed Act 
Facilitation of damage compensation through civil suit e.g., by the addition of an article that enables 
right holders to calculate the amount of damage fr om their profit, strengthening of penalties against 
such as the infringement of plant breeders' rights and provisions to ensure the credibility of a mark of 
protected variety such as by the introduction of articles to encourage to display the "mark of 
protected variety" and prohibit false marking. 
 
5. Act on the Prevention of Unauthorized  Recording of Movies in Theatres 
This Act was implemented to prevent the unauthor ized recording of movi es which are screened at 
theaters or any other places with similar functions.  
2008 
1. Amendment to the Customs Law Extension of customs enforcement to in clude the transit of infringing goods. 
 2. Amendment to the Patent Act and others. The current Patent Act and other Acts have a licen se registration system, which enables licensees to 
oppose the license to a third party when the patent ri ght is assigned to a new assignee.  The amended 
Act establishes the pre-grant licen se registration system, and it restricts the disclosure of registered 
items including the licensee's name only to those with  a legitimate interest in the registered license. 
 The amended Act includes clauses concerning the reduction of fees charged for registration and 
maintenance of patent and trademark rights, an d the extension of the period allowed for filing 
appeals against the examiner's decision. 
 
Q3. In Chapter IV, "Trade Policies by Sector", para graph 3, it is stated that "non-tariff barriers … 
are few".  Please indicate what non-ta riff barriers are currently applied? 
 A. Japan does not believe that any NTBs exist at the present time. 
 
Q4. In Chapter III, under the heading "Standard s, and sanitary and phytosanitary measures", 
subheading "Standards, testing, and conformity assess ment", it is stated in paragraph 48 on voluntary 
standards that there are Japanese Industrial Standard s (JIS) and Japan Agricultural Standards (JAS).  
Please explain whether the same revision, revocati on, harmonization and othe r procedures apply to a 
JIS as to a JAS. 
A. The JIS standards review procedure and those of the JAS are different. 
 (1) JIS  
Japan has been reviewing JIS items every five ye ars and, when necessary, taking appropriate 
procedures to revise or withdraw a part of th em, based on the Industrial Standards Law.    
Regarding harmonization of JIS with international  standards, Japan has been following appropriate 
procedures based on Annex 3 "Code of Good Practice" of the WTO/TBT agreement.   WT/TPR/M/211/Add.1 
 Page 295 
 
 
  (2) JAS 
 All JAS Standards are to be subject to review proced ure within five years after their establishments or 
revisions.  The procedure is as follows:  
Step 1: The Ministry of Agriculture, Forest ry and Fisheries (MAFF) consults with domestic 
stakeholders and conducts surveys on the current situation and future prospects for 
production, transactions and c onsumption.  Following these consultations and surveys, 
MAFF makes the first draft revision. 
Step 2: The Subcommittee of the JAS Council, a body comprised of consumers, producers, academic 
experts and other members, discusses the draft m ade by MAFF and makes modifications to it 
if necessary.  
Step 3: MAFF calls for public comments and also notifies the draft to the WTO secretariat for 
member consultation in line with the WTO/ TBT agreement. 
Step 4: After the approval of General Assembly of  JAS Council, the final draft will be published in 
government gazettes and implemented. 
 
Q5. In the same chapter, paragraph 49 concerni ng entitlement to certify operators, please explain 
what registration procedure is applied by th e Government to foreign certifying bodies. 
 
A. An outline of the procedure for registration is as follows: 
 
Step 1: Submit an application form to the Mi nister of Agriculture, Forestry and Fisheries (MAFF). 
Step 2: After MAFF confirms the submission of  required documents as well as the payment of 
registration fees and registration license taxes, th e Incorporated Administrative Agency, the 
Food and Agricultural Materials Inspection Center (hereinafter as to FAMIC), carries out 
document examination and on-site inspection in order to decide whether the applicant 
conforms to registration criteria.  Then, FAMIC  reports the result of its examination to the 
Minister of Agriculture, Forestry and Fisheries. 
Step 3: If FAMIC reports that the applicant confor ms to registration criteria and MAFF confirms it, 
the applicant will be registered as a ROCB by  the Minister of Agriculture, Forestry and 
Fisheries. 
 Q6. In the same chapter, under the heading "Ma ndatory technical regula tions", paragraph 54, 
reference is made to a set of inspection bodies.  Could Japan provide a list of the 26 inspection 
bodies?  A. The 26 inspection bodies designated by the Ministry of Economy, Trade and Industry mentioned in paragraph 54, page 48–49 of the secretariat’s report, are as follows:      
 
Consumer Product Safety Law 
(Cribs) Japan Recreation And Miscellaneous  Goods Safety Laboratory 
(Portable LASER applied appliances 
Japan Quality Assurance Organization UL Japan, Inc. Cosmos Corporation (Warm water circulation system for bathtub) 
Japan Electrical Safety& Environment Technology Laboratories 
Japan Gas Appliances Inspection Association UL Japan, Inc. Japan Heating Appliances Inspection Association Cosmos Corporation WT/TPR/M/211/Add.1 
Page 296  
 
  Electrical Appliance and Material Safety Law 
<Domestic Registered Inspection Bodies> Japan Electrical Safety & Environment Technology Laboratories Japan Quality Assurance Organization  Japan Electric Cable Technology Center 
TUV Rheinland Japan 
Cosmos Corporation UL Japan, Inc. <Foreign Registered Inspection Bodies> Underwriters Laboratories Inc. 
UL international Demko A/S 
Intertek Testing Services Hong Kong TUV Rheinland product safety GMBH TUV Rheinland Hong Kong TUV Rheinland Taiwan 
China Quality Certification Center  
Law Concerning the Securing of Safety and Optimizat ion of Transaction of Liquefied Petroleum Gas 
(Open flue type Instantaneous water heaters, Open fl ue type space heaters, Open flue type bath tub 
water heaters, Burners for bath tub water heaters,  Portable cookers using LPG canisters, Heating 
bodies for bath tubs) 
Japan Gas Appliances Inspection Association 
 (Gas valve for LPG appliances) Japan Gas Appliances Inspection Association Japan L.P.Gas Instrument Inspection Association 
 
Gas Utility Industry Law (Open flue type instantaneous water heaters, Open flue type space heaters, Open flue type bath tub 
water heaters, Burners for bath tub water heaters) Japan Gas Appliances Inspection Association 
 Q7. In the same chapter, under the heading "Labelling and packaging requirements", 
paragraph 65, reference is made to matters concer ning the labelling, regulatio n, import and inspection 
of genetically modified foods.  Could Japan elabor ate a little on the changes made in the adoption of 
measures on this issue, such as in relation to m ilk powder, meat and fish, among other products? 
 A. Genetically modified foods can be marketed only when they have been authorized as safe 
under the Food Sanitation Law, and they should be labeled when they are used as foods in accordance with the Food Sanitation Law as well as the Quality Labeling Standard for Genetically 
Modified Foods.  Regarding gene tically-modified powdered milk, meat , and fish, they are not subject 
to GM labeling since these products have not yet been distributed in Japan. 
MEXICO ADD.6
 
 
Q1. In the section on Japan's multilateral activities, refe rence is made to the fact that "Japan called 
upon countries to refrain from instituting restrictions  on agricultural exports and other measures at the 
High-Level Conference on World Food Security, hoste d by the Food and Agriculture Organization of 
the United Nations (FAO), in June 2008" (paragraph 33).  In the TPR Secretariat Report, 
paragraph 16, it is stated that "Japan maintains cer tain export controls on national security and public 
safety grounds and to ensure adequate domestic s upplies of certain agricultural and other primary 
products".  Could Japan clarify this possible discrepancy?  (Japan requires other countries not to  WT/TPR/M/211/Add.1 
 Page 297 
 
 
  impose export controls on agricultural products, wher eas it imposes such controls or is prepared to 
impose them in certain circumstances.)  
A. The main purpose of Japan’s proposal on expor t restriction was to clarify the interpretation 
and ensure strict implementation of export prohibitions or restrictions specified  in Article XI of the 
GATT.  Japan has proposed restraint on the export restrictions to clarify the definition "export 
prohibitions or restrictions temporar ily applied to prevent or relieve critical shortages of foodstuffs or 
other products essential to the exporting contrac ting party."  On the other hand, Japan's export 
controls were introduced to preserve limited natur al resources and to ensure national security, not 
because of the recent global food crisis.  In add ition, with regard to agricultural products, a very 
limited range of products, such as  the by-products used for animal feed, are subject to the export 
approval system and none of the agric ultural products for consumption are subject to this system.  
 
Q2. In the section on Japan's regional activities, ther e is a reference to the fact that "Japan is 
endeavouring for the further development of all regional cooperative frame works, including ASEAN 
Plus Three (Japan, China and the Republic of Korea), ASEAN-Japan, Japan-China-Korea tripartite 
cooperation and the newly established East Asia Summ it (EAS), along with larger organizations such 
as APEC and ASEM" (paragraph 39).  Could Japan gi ve its opinion on the integration process that is 
taking shape around the P4 (Chile, Brunei, New Z ealand and Singapore) plus the United States, 
Australia, Peru and possibly Viet Nam?  Would Jap an be interested in joining this initiative? 
 A. Japan has deep interest in this initiative.  Japan will seriously examine the possibility of 
engaging in this initiative in line with exi sting policy on possible EPAs in the future. 
  BRAZIL ADD.2
 
 
Q1. Please provide further details on the changes ma de by the Tax Reform for the tax treatment of 
interest rates received by non-residents.  
A. The portion interest income on bonds issued by a foreign company, which are attributed to a 
business conducted by that company in Japan, is now treated as a domestic source of income and 
taxed as such.   THAILAND
 
 
Q1. According to the Secretariat report, Japan has continued regulatory reform in the services 
sector by, inter alia,  enhancing transparency.  One of the exam ples noted in the report is the adoption 
of the "no action letter" system.  Could Japan pl ease provide more information about this system? 
 A. The "no action letter" system refers to the pro cedure by which a private enterprise or other 
organization confirms in advance with the admin istrative agency having jurisdiction to enforce 
certain laws and regulations whether specific actions  in connection with business activities that the 
enterprise or other organization seeks  to realize are subject to the provisions of the regulations 
concerned.  As a general rule, each government al department shall respond to an inquirer within 
30 days.  This system was introduced in March 2001 as a Cabinet Decision. 
 For details of the Cabinet Decision, please refer to the appendix. 
 
Q2. We are interested in knowing whether Japan in tends to attract inward FDI for any sector in 
particular.  We would also be interested in know ing more about Japan's policies regarding enhancing WT/TPR/M/211/Add.1 
Page 298  
 
  FDI and would appreciate it if Japan could provide mo re information and also direct us to relevant 
websites.   
A. In May 2008, the Expert Committee on FDI Pr omotion, which was established as an advisory 
body for Minister of State for Economic and Fiscal Policy in our organization, issued "Five 
Recommendations Toward the Drastic Expansion of Foreign Direct Investment in Japan."  
 One of the Five Recommendations, "E stablishment of priority strategi es by sector," sited the medical 
device industry as an important sector and an action  program was formulated in December 2008 to 
improve the environment for the d evelopment of medical devices in J apan.  We are will continue to 
choose some industries as important sectors and Ja pan welcomes FDI in board fields including the 
above-mentioned field.   To achieve the goal that was set in March 2006 to double FDI, amounting to around 5% of GDP, in five years by the end of 2010, in June 2006 Japa n launched a program called the "Program for the 
Promotion of FDI in Japan" which focuses on three key issues:  (1) the promotion of investment in 
local regions (2) the improvement of comprehensive investment envir onment with sense of urgency (3) 
the promotion of greater understandi ng through public information ac tivity.  To promote further FDI 
into Japan, Japan revised the "Program for the Acceleration of Foreign Direct Investment in Japan" 
in December 2008 in order to incorporat e the Five Recommendations in the program. 
The recommendations and the program are available at: 
http://www5.cao.go.jp/invest-japan/index.html  
Q3. The Secretariat report discusses Japan's measures to increase its attractiveness as an 
investment destination for foreign firms.  Such measures include adopting tax measures to facilitate 
mergers and acquisitions, and providi ng them with national treatment.  Could Japan please provide 
more details on these policies for the benefit of potential Thai investors, including regulations 
concerning inward FDI a nd relevant website?  
 
A. Japan revised the "Program for the Acceleration of Foreign Direct Investment in Japan" and 
included some policies like the strategic disseminati on of information by each local government and 
wide-area collaboration of local governments, th e improvement of the investment environment 
through measures such as those to facilitate M& As and international capital flow, and active 
publicity to welcome foreign companies toward  domestic and foreign areas into the program.  
Regarding the adoption of tax measur es to facilitate M&A, Japan has permitted so-called triangular 
mergers with tax deferral since 1 May 2007.  
For further information about the program, please see the following website: http://www5.cao.go.jp/invest-japan/index.html. 
  
INDONESIA
 
 Q1. Could the Japanese Government explain the r easons of the abolition of the Cabinet-level 
Japan Investment Council, and the establishment of  the Expert Committee on FDI Promotion within 
the Cabinet Office?  Are there any effects of thes e decisions to Indonesia particularly the shift of 
Japanese investment from Indonesia?   A. At the end of 2007, the Chief Cabinet Secret ary gave instructions to  reduce the number of 
councils of which the Prime Minister and the Chie f Cabinet Secretary were members.  Consequently, 
the Japan Investment Council was abolished in Dece mber 2007.  However, Japan needed to continue 
to endeavor to meet the goal to double FDI by 2010 and newly established the Expert Committee on 
FDI Promotion, an advisory body for the Minister of State for Economic and Fiscal Policy, in  WT/TPR/M/211/Add.1 
 Page 299 
 
 
  January 2008.  The change was simply an organizational reform without policy alteration.  Japan 
continues to implement measures in order to ac hieve the goal to double FDI into Japan by 2010. 
 The main function of the committee is gathering information on the improvement of the Japanese 
investment environment and studying policies relevant to the promotion of investment.  The Expert 
Committee published "Five Recommendations To ward the Drastic Expansion of Foreign Direct 
Investment in Japan" in May 2008 to promote furth er FDI into Japan.  For further information, 
please access following website http: //www5.cao.go.jp/invest-japan/index.html. 
 Japan has not changed its attit ude in that it welcomes investment from Indonesia. 
 
Q2. As indicated on this statement, the Japan ese Government has been actively pursuing EPAs 
negotiations, which reflect its strategy of incr easing leverage for promoting multilateral trade 
liberalization.  Could the Japanese Government provide more detail of the guidelines used for 
choosing EPA negotiating partners?  In addition, we  know that the Japanese Government has an EPA 
with several ASEAN countries.  In this regard, wh at is the reason that the Japanese Government also 
negotiates an EPA under ASEAN JAPAN EPA?  
A. For the purpose of identifying possible EPA partners, Japan continues to examine, in a 
comprehensive manner, possible EPA partners, giving with due consideration to various viewpoints 
such as creation of an international environmen t beneficial to Japan, en suring Japan's economic 
interest as a whole, the current situation of po ssible partner countries and regions as well as the 
feasibility of each EPA.  Japan has already concluded bilat eral EPAs with some ASEAN member countries as well as with 
ASEAN as a whole.  This is based on viewpoint t hat bilateral EPAs may include detailed provisions 
for trade related rules, including those on the libera lization of trade in goods and services as well as 
tariff concessions tailored to the particular needs of both Japan and th e other party.  In comparison, 
as an agreement with ASEAN as a whole, AJCEP enhances the strategic relations between Japan and 
all of the members of ASEAN.  It also strengthe ns the production network covering Japan and ASEAN 
through the establishment of common rules. 
 Q3. Are there any possibility to include agricultural products and some industr ial products into the 
agreement on the occasion of general review of the implementation of JIEPA in the fifth calendar year following the entering into force JIEPA, e.g. on 1 July 2013?   
A. As stipulated in Article 151 of the Agre ement between Japan and the Republic of Indonesia 
for an Economic Partnership, "The Parties shall und ertake a general review of the implementation 
and operation of this Agreement in the fifth calendar  year following the calendar year in which this 
Agreement enters into force, and every fi ve years thereafter, unless otherw ise agreed by the Parties."  
In addition, paragraph 2 of Article 20 of Chapter 2 (Trade in Goods) s tipulates that "upon the request 
of either Party, the Parties shall negotiate on issues such as improving market access conditions on 
originating goods designated for negotiation in the Schedule in Annex 1, in accordance with the terms 
and conditions set out in such Schedule."  Japan cann ot prejudge the outcome of the general review at 
this stage.  
Q4. In this matter, we would appreciate to have  further explanation regarding non-tariff border 
measures applied by the Japanese Government?  Is that any assistance given to developing countries 
to handle the case of non-tariff barriers. 
 
A. Japan does not believe that any NTBs exist at the present time. 
 
Q5. May we have some details regarding the mechanism to obtain such exempted inspection WT/TPR/M/211/Add.1 
Page 300  
 
  A. Test results obtained in the exporting country may be attached to the import notification 
forms at the point of entry.  In the case that importers conduct tests voluntarily or following administrative consultation, these tests may be done  at the Ministry of Health, Labour and Welfare 
(MHLW) registered overseas labo ratories.  This scheme does not cover such items as bacteria and 
mycotoxins, since the state of these items are liable to change during transportation.  
 
To be registered with the MHLW, laboratories mu st be capable of conducting tests using AOAC 
methods approved by AOAC International or equi valent methods, and be either of the following: 
 Laboratories under the direct control of the nationa l or state government of the exporting country 
(official laboratories) 
 Laboratories certified or designated by the nationa l or state government of the exporting country 
(designated laboratories) 
 Q6. Indonesia wishes to have clarification as to whether the Japanese government has had a 
program to extend this program, particular ly GSP preferential rates to Indonesia.  
 
A. Japan shall undertake a review of the implementation and operation of the Agreement 
between Japan and the Republic of Indonesia for an Economic Partnership, and negotiate upon 
request, issues such as improving market access conditions on originating goods designated for 
negotiation, in accordance with the provisions in the said Agreement.  Japan grants preferential tariff 
treatment under its GSP scheme to 141 developing  countries and 14 territories for 337 agricultural 
and fishery products and 3,217 industr ial products at the nine-digit tariff line level.  Japan will 
continue to consider all aspects of the GSP schem e, in preparation for a possible revision of the 
scheme in 2011. 
 
Q7. Indonesia wishes to have clarification as to whether the Japanese government has not 
included products such as dairy products, some footwear, and textiles and clothing, in the GSP 
scheme for developing countries?  
A. Taking into account the situation of each domestic industry, Japan has not included certain 
products in its GSP scheme.  
Japan will continue to consider all aspects of th e GSP scheme, in preparation for a possible revision 
of the scheme in 2011. 
 Q8. Under MIDEC cooperation in JIEPA, OVOP is in cluded in MIDEC.  Related to this matter, 
what is the implementation progress so far?  Could the Japanese government expedite the 
implementation of such cooperation in order for Indonesia to reap benefit from JIEPA.  
 A. Japan has shared on various occasions with  the Government of Indonesia progress regarding 
the OVOP project that is being implemented under the MIDEC scheme, in accordance with the 
Agreement between Japan and the Republic of Indo nesia for an Economic Partnership.  The progress 
was shared most recently during the meeting held in Jakarta in December 2008.  Furthermore, the 
latest developments of the OVOP Project were shared and discussed among the members of the working group of the project during a meeting in January 2009.  As such, Japan will continue to 
support this OVOP movement with the full cooperation from the Indonesian government. 
 
  WT/TPR/M/211/Add.1 
 Page 301 
 
 
  REPLIES PROVIDED BY JAPAN TO OU TSTANDING AND FOLLOW-UP QUESTIONS 
 
 
INDIA ADD.1  
 
Q1. During the last Trade Policy Review Jap an had informed that under its new TPPRR 
(Three-year Program for Promoting Regulatory Re form) it would take the following measures relating 
to movement of natural persons:  
a) Review its immigration control measures, including concrete measures of accepting those 
who have special knowledge and skills. 
b) Review the existing system for the expansion of entry of foreign IT engineers,  c) Clarify the status of residence of "Investors/Business Managers" and make even more 
accessible the information on the status of residence of "Intra-company Transferees", and 
d) Make guidelines on the requirements for the st atus of residence of "Permanent Resident". 
 
The concrete steps taken by Japan on these measures re lating to movement of natural persons may be 
detailed.  
A.  
a) Japan published the "Basic Plan for Immigr ation Control (3rd Edition)" in March 2005, 
which specified major issues and guidelines for Immigration Control Administration Services 
including concrete measures on promoting the acceptance of foreign workers in professional 
or technical fields.(For more information, please visit 
 http://www.moj.go.jp/ENGLISH/information/bpic3rd.html.) 
b) More foreign examinations and qualifications mutually certified in Japan and designated as 
such by the Minister of Justice in the Officia l Gazette will be included based on the results of 
mutual certification in the future. 
c) Japan gave an explanation of the statuses of residence such as “Investors/Business Manager" 
and "Intra-company Transferee" as well as th e links between these statuses in 2004 at 
http://www.immi-moj.go.jp/english/keiziban/happyou/sougou.pdf. 
d) Japan announced the "Guidelines for Permi ssion for Permanent Residence" on 31 March 
2006 at:  http://www.immi-moj.go.jp/english/te tuduki/index.html.  In the Annex of MNP of 
GATS, it said that the agreement shall not  apply to measures regarding residence on a 
permanent basis. 
 
Q2. In the last TPR Japan had informed that, "With  a view to facilitating the movement of natural 
persons, Japan has a list of eight trading partners  (China, Chinese Taipei, the Republic of Korea, 
Malaysia, Myanmar, the Philippines, Singapore, and Vi et Nam) whose examinations or qualifications 
of IT engineers are recognized by the Japanese  Immigration as eligibility criteria to obtain the 
residence status of "engineer"."  Japan may elucid ate the criteria for recognition of qualification by 
the concerned Japanese Ministry. 
 
A. Following reports from the Ministry of Econom y, Trade and Industry, which is the competent 
authority for mutual recognition of qualification for IT engineers, foreign examinations and 
qualifications on information-processing skills designat ed by the Minister of Justice have been added 
to the Official Gaze tte whenever necessary. 
 
Q3. In its Revised Offer the period of stay for an  intra-corporate transferee has been reduced from 
five years to 'one or three years, which may be  extended'.  The same is the case for Contractual 
Service Suppliers and Independent Pr ofessionals.  Could Japan clarify wh at 'one or three years' means 
and why this should not be considered as a roll back?   
 WT/TPR/M/211/Add.1 
Page 302  
 
  A. The amendment of the period of stay for an intra-corporate transferee from "for a period not 
exceeding 5 years" to "for a period of one or three ye ars, which may be extended" is not a roll back. 
Previously, intra-corporate transferees were allowe d to stay in Japan only for a period not exceeding 
5 years in all with extensions of periods of stay fo r six months or one year.  In accordance with the 
revision of the Ordinance for Enforcement of the Immigration Control and Refugee Recognition Act 
in 1999, Japan reflected the abolition of the provision "for a period not exceeding 5 years" and 
incorporated the revised provision of "for a peri od of one or three years" into the revised offer. 
 
Q4. What are the requirements for opening up of a foreign bank branch in Japan?  The details may 
be provided.  Is there a minimum prescribed peri od for processing an appli cation for opening up of 
foreign bank branch? 
 
A. The Banking Act provides licensing requiremen ts for banks for prudential reasons. Article 4 
provides licensing requirements for banks incorporated  in Japan, including subsidiaries of foreign 
banks.  Article 47 provides licensing requirements for branches of foreign banks. Both articles 
provide that, in issuing banking licenses, the Fi nancial Services Agency shall examine whether (1) the 
applicant has adequate financial capa city to carry out sound and e fficient banking business, and the 
prospective income and expenses of its business opera tions will be satisfactory, (2) the applicant, in 
respect of its personnel composition, etc., has th e relevant knowledge and experience to carry out 
banking business appropriately, fairly and effic iently and possesses adequate social credibility. 
 
In applying for a license to join the banking business, Japan must endeavor to judge whether or not to 
give a banking license within a month.  There are no requirements in terms of nationality. (Article 40 
in the Ordinance of Banking Act) 
 
Q5. Are there difficulties being faced by forei gn bank branches in running their day to day 
operations in Japan?  This becomes significant b ecause as per the report of the Secretariat, "At 
end-February 2008, there were 214 banks; 64 were  foreign (Table IV.4), five fewer than at 
end-February 2006." (para 36 page 82).  Further, as per Table IV .4 (page 82) on Financial institutions, 
2008 foreign banks as a percentage of all banks in  Japan are 30% and total assets of these foreign 
banks are only around 7% of the to tal assets of all banks in Japan. 
 A. Both domestic banks and foreign bank branc hes conducting banking businesses in Japan 
must obtain banking licenses.  However, the day-to- day operations of each bank are different.  
Therefore, the Financial Services Agency is not awa re of what difficulties are being faced by foreign 
banks in running their day-to- day operations in Japan. 
 Q6. It is understood that as per the ordinance of  the Japanese Ministry of Finance, establishment 
of identity of corporate in respect of loans/inv estments under KYC norms is exempted if the company 
is registered in the Stock Exchange of only some  countries.  If it is correct, Japan may explain the 
reasons for such differential treatment.  
A. In regard to companies listed in the st ock markets of certain foreign countries, the 
identification of the company itself is not required because the existen ce of the company is confirmed 
through an examination of the listing eligibility of the company.  If the customer for a loan/investment is such a co mpany as mentioned above, the identification of a 
natural person who actually takes charge of tr ansactions on behalf of the company must be 
confirmed, so that the natural person may be deemed as the customer for the transaction.  
 
Q7. In its Revised Offer no improvements have been  offered by Japan in the movement of natural 
persons in the area of medical services and other professional services such as R&D Services, recreational services etc.  Is Japan considering offering any improvements in these areas?   WT/TPR/M/211/Add.1 
 Page 303 
 
 
  A. Japan is not considering offering improvemen ts for the services referred  to in the question 
from India.  Additionally, Japan considers that R& D services are covered by CSS in its revised offer.  
 
Q8. The term "contractual services suppliers" is used  but not defined as per the plurilateral request 
on Mode 4 made to Japan.  Further, the Immi gration Control and Refugee Recognition Act is 
incorporated by reference.  Could Japan info rm whether it is considering conforming to the 
plurilateral request?  Further as per Japan's offer C ontractual Services Suppliers (CSS) is limited in its 
coverage is there any propo sal to expand the coverage?  
 
A. Japan will refrain from answering this question in  writing at this moment, as it is related to 
the 2nd revised offer.  Japan, however, holds the vi ew that it is important to preserve the offer 
indicated at the WTO Ministerial Services Signaling Conference in 2008 as a good basis for further negotiation.  With this in mind, Japan would like to activel y participate in service negotiations and 
hopes that the "service cluster meeting" starting at  the end of March will be a good restart for the 
negotiations with capital-based participation from as many Member States as possible.  
 
Q9. Given the fact that Japan's Immigration Contro l Act is much more liberal in allowing entry of 
natural persons (i.e. Medical Services, Researchers,  Entertainers and Skilled Labour) into Japan than 
it offer at the WTO, is Japan proposing to expand the same and if not why?  
A. No.  Regarding the acceptance of foreign natio nals, it should be decided on after taking 
situations such as the Japanese economy and society in to consideration.  Therefore, it is not possible 
to make Japan's current Immigration Control Ac t a comprehensive inter national commitment. 
 
Q10. It is understood that for a number of sectors for Mode 1 there is a requirement of establishment.  Japan may provide detailed regulations  in English with respect to the sectors in which 
Mode 1 requires commercial establishment. 
 
A. In principle, The sectors (or sub-sectors) in Mode 1 which require commercial establishment 
and their related laws are as follows:  Sector:  Professional Services 
Related Law:  Attorney Act, Chapters 3, 4, 4- 2 and 5; Act on Special Measures Concerning the 
Handling of the Legal Services by Foreign lawyer s, Chapter 4;  Patent Attorney Law, Chapters 6 
and 8;  Notary Law, Chapters 2 and 3;  Judicial Scrivener Law, Chapters 3, 4, 5, and 7;  Certified Public Accountant Law, Chapters 5-2 and 7;  Cer tified Public Tax Accountant Law, Chapters 3, 4, 
5-2, 6 and 7;  Enforcement Regulation on Certifie d Public Tax Accountant Law; Architect and/or 
Building Engineer Law, Chapter 6;  Certified Social Insurance and Labor Consultant Law, 
Chapters 2-2, 4-2 and 4-3;  Certified Administrative Procedures Specialist Law, Articles 6, 6-2, 8 
and 19;  Land and House Surveyor Law, Chapters 3, 4, 5 and 7.   Sector:  Real Estate Related Law:  Building Lots and Buildings Tr ansaction Business Law Chapter 2, Real Estate 
Syndication Law, Chapter 2; Law Concerning Impr oving Management of Condominiums, Chapter 3. 
 Sector:  Real Estate Appraisal Services  Related Law:  Law Concerning the Appraisal of Real Estate, Chapter 3.  
Sector:  Measuring Services 
Related Law:  Measurement Law, Chapters 3, 5,  6, and 8; Regulations on Measurement Law;  
Ministerial Ordinance for Designated Inspection Bo dy;  Designated Verification Body;  Designated 
Measurement Certification Inspection Body; Sp ecified Measurement Certification Accreditation 
Body. WT/TPR/M/211/Add.1 
Page 304  
 
  Sector:  Business Services  
Related Law:  Employment Security Law, Chapter 3;  Law Concerning Securing the Proper 
Operation of Worker Dispatching Undertakings and Improved Wo rking Conditions for Dispatched 
Workers, Chapter 2;  Port Labor Law, Chapter 4; Ma riners' Employment Security Law, Chapter 3;  
Law Concerning the Improvement of Employme nt of Construction Workers, Chapters 5 and 6. 
 
Sector:  Mining Related Law:  Mining Law, Chapters 2 and 3.  Sector:  Automobile Maintenance Business 
Sub-Sector:  Motor Vehicle Disassembling Repair Business 
Related Law:  Road Vehicle Law, Chapter 6.  Sector:  Surveying Services Related Law:  Survey Law, Chapter 6. 
 
Sector:  Construction Related Law:  Construction Business Law, Chapter 2;  Law Concerning Recycling of Construction 
Materials, Chapter 5.  Sector:  Wholesale and Retail Trade 
Sub-Sector:  Livestock 
Related Law:  Livestock Dealer Law   Sector:  Vocational Skills Test under the Human Resources Development Promotion Law 
Related Law:  Human Resources Development Promotion Law, Chapter 5. 
 
Sector:  Credit Management and Collection Business Related Law:  Special Measures Act Law Concern ing Credit Management and Collection Business, 
Articles 3 and 4.  Sector:  Medical, Health Care and Welfare 
Related Law:  Law Concerning Collection of La bor Insurance Premiums, Chapter 4; Enforcement 
Regulations for the Law Concerning Coll ection of Labor Insurance Premiums. 
 Sector:  Transport Sub-Sector:  Customs Brokerage, Freight Forwarding Business (excluding freight forwarding 
business using air transportation), Road Trans port, Services Incidental to Transport 
Related Law:  Customs Brokerage Law, Chapter 2; Freight Forwarding Business Law, Chapters 2, 
3 and 4;  Enforcement Regulation of Freight Forwarding Business Law;  Road Transport Law, 
Chapter 2;  Trucking Business Law, Chapter 2;  Pilotage Law, Chapters 2 and 3.  Sector:  Services Related to Occupational Safety and Health   
Related Law:  Industrial Safety and Health Law, Chapters 5 and 8;  Regulation Concerning 
Registered Inspection Agency and Other Related Agen cies, Working Environment Measurement Law;  
Enforcement Measurement Law. 
 
Q11. The category of Independent professionals has not been defined as per the plurilateral request 
on Mode 4 to Japan.  Further, commitments in Independent Professionals are for a very limited 
number of professions (legal, accounting, auditing and bookkeeping and taxation) which also are 
subject to domestic qualification requirements a nd procedures.  Does Japan propose to expand its 
commitments in Independent Professionals?   WT/TPR/M/211/Add.1 
 Page 305 
 
 
  A. Japan is not considering an expansion of its  commitments for Independent Professionals. 
 
Q12. The same restrictions in Mode 1 and 2 in  Professional services apply, as was the case in the 
Uruguay Round except that they are listed in the Market Access column.  Any plans of? 
 A. Commercial presence requirements on Mode 1 and 2 (especially professional services) are 
reserved for the purpose of consumer protection, in cluding taking prompt action in the event that 
problems of malfeasance, such as fraud, occur.   Japan is considering the removal of these restrictions. 
 
Q13. In Primary Educational Services, the new c ondition that excludes nurser y schools seems to be 
a rollback since the UR commitment included kindergarte ns.  This confusion is aggravated by the fact 
that footnote 21 includes the category of kindergart ens.  We would appreciate clarification in this 
regard. 
 
A. Kindergartens are schools that provide a fo rm of elementary/primary education, as do 
elementary/primary schools.  However, unlike kind ergartens, nursery schools are classified as child 
welfare facilities and are not schools that provide education. 
 
Q14. Is there any possibility of expanding the c overage for Independent Professionals, which is 
restricted to Legal, Accounting, Auditi ng and Bookkeeping, and Taxation services? 
 
A. Japan is not considering an expansion of the coverage for Independent Professionals. 
 
Q15. The Secretariat's Report states that nearly 99% of all tariff lines in Japanese Tariff Schedule 
are bound.  Which are the unbound items in Japanese Tariff Schedule?  Please furnish the applied 
duties on these items.  
A. Major unbound tariff lines are referred in Chapt er 3, paragraph 18 of the Secretariat Report. 
With regard to the applied duties, please refer to the following Web Site: 
http://www.customs.go.jp/english/tariff/2009/index.htm 
 
Q16. It has been stated in the Secretariat's Report that in the case of agricultural products, 
accounting for 6.7% of all tariff lines, non- ad valorem  duties tend to involve high ad valorem  
equivalents.  Will Japan indicate the range of ad valorem duty incidence for these items?  Also, please 
indicate, in descending order, the ad valorem  incidence of duty on 10 top agricultural items (in terms 
of duty incidence). 
 
A. AVEs vary depending upon calculation methods or import values.  With regard to the AVEs 
Japan provided to the WTO Secretariat, as the Repo rt says, AVEs for 93 tariff lines are not available 
due to technical reasons and a lack of import valu e data.  Japan cannot provide the requested data. 
 Q17. The Secretariat Report states that Japan a pplies some import prohibitions and quantitative 
import restrictions on certain items.  What is the nature of such prohibitions and restrictions?  Are 
restricted goods different from prohibited goods and if  so, in what respect?  Will Japan furnish the list 
of goods that are subject to prohibitions and restrict ions?  It would be usef ul if Japan could also 
indicate the nature of prohibitions and restrictions against each item.  
 
A. The items which are subject to import quotas  are the specific marine products and substances 
listed in the Annex of the Montreal Protocol on Subs tances that Deplete the Ozone Layer.  The aim of 
the import quota system is to complement c onservation and management measures for fishery 
resources in waters adjacent to J apan and to observe the agreements Japan has concluded.  Likewise, WT/TPR/M/211/Add.1 
Page 306  
 
  the aim of applying some import prohibitions is to observe the agreements Japan has concluded, and 
so on.  Some import prohibitions are, for example, on the imports from non-contracting States of each 
agreement and on freight sanctioned under the Secur ity Council's resolutions and other agreements.  
Therefore, both are based on the agreement of the WTO.  Please refer to the WTO annual report and 
the following website for a complete list:  h ttp://www.cas.go.jp/jp/seisaku/hourei/data/ITCO.pdf 
 
Q18. The Secretariat Report states that in 2006, th e average time between arrival of goods and the 
granting of import permission was 63.8 hours (2.7da ys) for sea cargo and 14.4hours (0.6days) for air 
cargo.  In this connection, India would like to know  the average time taken by the agencies concerned 
for their allotted activities which taken together r esulted in the dwell time of 2.7 days for sea cargo. 
 
What is the present dwell time for import cargo i.e.  the average time taken for clearance of import 
cargo?  Please apportion the time taken by the various agencies/importer.  
A. The survey on the average time for import pro cedures measures the time between "arrival of 
goods" and "brought into hozei area," "brought in to hozei area" and "filing import declaration," and 
"filing import declaration" and "issuing import permit. "  So the average time taken by the agencies 
concerned for their allotted activ ities has not been measured.  
 The latest survey was conducted in 2006. 
 Q19. It has been stated that with the adoption of amendment to the Customs and Tariff Law as on 
31 March 2008, the overtime charge systems was abo lished.  Please explain the rationale for and 
purpose of this overtime charge system.  Does this mean that after abolition of the overtime charge 
system, no overtime charge will be collected by the Customs and other government agencies for the 
work performed beyond normal office hours and on Saturday/Sundays/other public holidays?  Please 
provide details. 
 
A. Overtime charges had been required of tho se who asked for work performed beyond normal 
office hours, etc. in respect of beneficiary liability .  The abolishment of the overtime charge system 
means that no overtime charges will be collect ed by Customs for work performed beyond normal 
office hours, etc.  Other government age ncies have not collected this charge. 
 
Q20. What is the eligibility criterion for the grant of Authorized Economic Operator (AEO) status?  
Does the compliance record mentioned at pages 34  and 52 refer to importer's/exporter's compliance 
with Customs requirements or the importer's/expor ter's compliance with Customs and other allied 
laws?  What are the additional facilities granted to  the AEOs that are not available to the normal 
importer's/exporter's?  Is the AEO based on any international standard?  Does Japan use risk 
management techniques in the assessment of any applications for grant of AEO status?    
A. The eligibility consists of "Appropriate co mpliance records," "Capability to conduct related 
operations properly," and "Establishment of a Compli ance Program," etc.  The importer's/exporter's 
compliance refers to the complian ce with Customs laws, etc.  
 
Applications for AEO status are assessed thr ough the examination of applications and relevant 
documents and on-site in spections at the offices of applicants, etc.  
 
As for additional benefits other than what th e Secretariat Report states, importers with good 
compliance are permitted to file cust oms duty declarations no later than the last day of the next month 
following the date of import permission, and customs inspections are reduced.  The Japan AEO program has been implemented in accordance with the WCO Framework of 
Standards.  WT/TPR/M/211/Add.1 
 Page 307 
 
 
  Q21. Under Article 8 of the GATT, 1994, all fees and charges imposed on or in connection with 
importation or exportation shall be li mited in amount to the approximate cost of services rendered.  In 
this connection, India would like to know whethe r the inspection fee of ¥5,000/hour represents the 
cost of services rendered, or some other elements are al so included in this fee.  What are the other fees 
included in the customs clearance fees apart from th e inspection fee?  Further, India would like to 
know whether the Customs clearance fees are also charged for the work performed at the hours 
beyond the normal working hours and on Satu rdays/Sundays and other public holidays. 
 
A. The inspection fee of ¥5,000/hour represents th e cost of services rendered.  This fee includes 
only labor costs and transportation costs for inspections out of the designated area and is not for the 
cost of Customs clearance.  No ot her elements are included in this f ee.  A customs clearance fee is not 
charged for work performed at times beyond the normal working hours and on Saturdays/Sundays and other public holidays. 
 
Q22. It has been stated that written advance ruli ngs are issued at the written request of importers 
and other parties concerned.  In this connection,  please clarify as to what information is necessary 
from the applicant to issue an advance ruling, th e time period by which the Advance Ruling Authority 
will issue an advance ruling and the length of tim e for which the advance ruling will be valid.  Who 
can ask for an advance ruling and what are the elig ibility criteria? What are the subjects covered under 
advance rulings?  Does advance ruling cover bot h imports and exports?  Does the Japanese law 
provide for a review by the Advance Ruling Author ity of the advance ruling or the revocation or 
modification of the advance ruling? Please provide details. 
 
A. The following information is  necessary from the applicant: 
Applicant (name, address) Importer, exporter, producer, and agent (name, address, if known) 
Detailed description of goods 
Description of materials used in manufacture Information deemed useful by the applicant Whether the applicant previously applied for an advance ruling for similar or identical goods 
Other necessary information reasonably required to pro cess a request for assessment 
The Customs authority shall endeavor to issue a response within 30 days (Classification and Origin) 
or 90 days (Valuation). 
The response is valid for three years.  Importers, exporters or stakeholders who know the products' manufacturing process etc., can apply. 
Anyone with a justifiable cause can ask for an advance ruling. Tariff classification, origin of go ods, and customs valuation are covered. 
This system does not cover export. 
The advance ruling may be voided if the stated conten t of the goods does not match the actual article, 
if the expiration date has passed, if the situation is  changed due to the amendments of laws and 
regulations, or if the application of laws and regulati ons is incorrect.  Objections to the information 
provided in the written response can be filed with in two months from the date of issuance or 
notification of the response.  
The information provided prior to importation in the attached form is honored on customs 
examination.  A response is provided orally for oral inquiries, however, such responses are not 
honored on customs examination.  Therefore, this information does not bind anyone, so this system 
might not be called "ruling" but just "information."   
For further information, please refer to the following website: 
http://www.customs.go.jp/english/c-answer_e /imtsukan/kanzeiritsu/ 002kanzeiritsu1202_e.htm. 
 
Q23. The Secretariat Report states that the aut horities are planning to introduce the Common Portal 
for the Next Generation Single Window in October 2008.  The portal is intended to unify electronic WT/TPR/M/211/Add.1 
Page 308  
 
  application formalities among various agencies;  the authorities expect  that it will increase efficiency 
by allowing data-sharing among the agencies concerned.  Please indicate whether the said Common Portal has been introduced and if so, the details thereof may kindly be provided.  
A. Japan Customs has been developing a Single Wi ndow system in Japan, in which information 
and communication technology in co-operative arrangements between Customs and other border 
agencies (Ministry of Justice;  Ministry of Land, Infrastructure and Transport;  Ministry of 
Agriculture, Forestry and Fisheries;  Ministry of Economic, Trade, and Industry;  Ministry of Health, Labor and Welfare) to enable all the parties in  an import/export and vessel clearance transaction to 
use a Single Electronic Window.  Through this win dow relevant official border agencies can share 
prescribed control data and provide traders with a streamlined "one-stop shop" release/clearance 
processing system.  The border agencies concerned have been jointly developing the Common Portal, which is the portal 
for the "Single Window," which was introduced in October 2008. 
 
The portal has a unified applicant ID system, elec tronic application process and data input processes, 
all of which previously had different specifications  among the agencies concerned.  The portal has 
also enabled data-sharing among the agencies c oncerned, and helped applicants to save work by 
allowing them to reuse basic information they ha ve submitted to the Common Portal.  Furthermore, 
these highly convenient services are provid ed through a user-friendly interface. 
 
Q24. The Secretariat Report states that three law su its were filed in 2006 and three in 2007.  Please 
explain the nature of a law suit.  Are law suits filed against the decisions taken by the Director-General of Customs?  Can't the im porter/exporter file a law suit against Customs' decisions (lower in 
rank than DG, Customs) directly in the Japanese courts in the form of a write?  
 
(Q. Please explain the nature of a law suit.)   
A. The lawsuits filed in 2006 and 2007 include adm inistrative suits for cancellation of acts of 
Customs and compensation for the damage caused by Customs. 
 (Q. Are law suits filed against the decisions taken by the Director-General of Customs?  Can't the 
importer/exporter file a law suit against Customs' deci sions (lower in rank than DG, Customs) directly 
in the Japanese courts in the form of a write?)  
A. The subject of administrative suits for cance llation is the decisions or acts taken by the 
Director-General of Customs.  Even if the damage was caused by individual officers (lower in rank 
than the DG of Customs), people can file administr ative suits for compensation for the damage. 
 It depends on the types of Customs acts.  For instance, in cases where co llection of Customs duties or disposition on unpaid duties is the 
subject, the importer/exporter has to take adminis trative appeal procedures before they bring the 
cases to the courts.  On the other hand, they can file directly for deci sions on whether to accept applications for the 
identification procedures for intell ectual property rights (IPR), or the identification of goods as 
infringing on IPR.  
Q25. It has been stated that impo rts are valued according to their c. i.f value (which is taken to be 
the transaction value of the imports).  Footnote 10 at page 36 states that a differential duty involves a specific rate charged per kg of imports with the rate  varying directly with the difference between the  WT/TPR/M/211/Add.1 
 Page 309 
 
 
  standard import price set by the authorities, and actual import price.  Please explain the concepts of 
the 'standard import price set by the authorities' and the 'actual import price'.  What are the goods that attract differential duties?  
A. The tariff amount is set to the difference between the actual import prices and the standard 
import price.  The mechanism is described in the following diagram:  
 
※A sampl e of Live Swine or m eat of sw i ne, fresh, chilled or frozenstandard
impor t
price
０thresholdCI FC IF ＋ tari ff
tariff
thresholdactual
impor t
price
 
 
The lines subject to differential duties are as fo llows:  0103.92, 0203.11ex,  0203.12ex, 0203.19ex, 
0203.21ex, 0203.22ex, 0203.29ex, 0206.30ex, 0206.49ex, 0210.11, 0210.12, 0210.19, 0210.99ex, 1602.41ex, 1602.42ex and 1602.49ex based on HS2007. 
 
Q26. Under the WTO Agreement on Customs Valuati on, the primary basis for customs value is the 
'transaction value' as defined in Article 1.  I ndia would like to know as to how the valuation method 
linking the collection of duty to the standard import price fits into the valuation methods enshrined in the said Agreement.  Also, please explain how the standard import price is set by the authorities.  
A. The customs value of imported goods to which a differential duty applies is to be determined 
under Articles 1 to 7 of the WTO Agreement on Cu stoms Valuation in the same manner as other 
imported goods.  The standard import price has been set consideri ng the result of the UR negotiations and the 
negotiations with countries concerned at that tim e.  The prices are consistent with the WTO 
Agreements.  
Q27. The Secretariat Report states that under Article 19 of the Customs Tariff Law, tariffs on raw materials used in the production of export goods by factories approved by Customs may be reduced, 
exempted or refunded (by a drawback scheme).  Ther e has been no change to the list of goods subject 
to tariff reduction, exemption, or refund since th e previous Trade Policy Review of Japan.  Please 
provide the details of drawback scheme.  Also, please furnish the list of goods subject to tariff 
reduction, exemption or refund, showing separatel y the goods that are subject to tariff reduction, 
exemption or refund.  WT/TPR/M/211/Add.1 
Page 310  
 
  A. With regard to any imported raw materials which are to be used for manufacturing export 
goods and are prescribed by a Cabinet Order, the customs duty chargeable thereon is to be reduced, 
exempted, or wholly or partially refunded, as ma y be prescribed a Cabinet Order, if the said 
manufacturing is carried out at the manufacturi ng factory approved by the Director General of 
Customs and the products manufactured from the said  raw materials are exported.  In this case, 
reduction or exemption from customs duty is only to  be made when the said products are exported 
within two years from the date of import permission of the said raw materials  The goods which are exempted from customs duty are imported raw materials enumerated in the 
second column of the following table which are used  for manufacture of the export goods listed in the 
first column of the said table.  
Export goods Imported raw materials 
1. Products of alloy containing lead and antimony (as prescribed by an 
Ordinance of the Ministry of Finance) Unwrought lead (excluding alloy) 
2. Fish in cans, bottles or pots Cottonseed oil 
3.  Sodium glutamate Soybean oil cake, manioc starch, sago starch or 
molasses 
4.  Refined sugar, sugar rock  candy or cube sugar Sugar 
5.  Starch caramel or sugar caramel Manioc Starch, Sago starch or potato starch 
6.  Lysine Molasses 
7.  Refined glucose Manioc Starch, Sago starch or potato starch 
8. Export goods, other than those enumerated in (1) to (7) above, for which 
the kind and quantity of raw materials used are clearly identifiable in view 
of a production yield, etc. of the raw materials, and which are approved by 
the Director-General of Customs as those unsuitable for manufacture at a 
hozei  manufacturing warehouse for the reason that exportation is not made 
repeatedly, etc. Imported raw materials approved by the Director-
General of Customs as those used for the manufacture 
of the said export goods 
 The goods which are reduced in customs duties are imported raw materi als enumerated in the 
second column of the following table which are used  for the manufacture of the export goods listed in 
the first column of the said tabl e, whereas the rate of customs duty on such imported raw materials is 
reduced to that specified in the third column. 
 
Export goods Imported raw materials Duty rate 
1. Sodium glutamate Wheat flour 12.5% 
2. Vitamin C and derivatives thereof (including 
preparations which contain 95% or more by weight). Manioc starch, sago starch or potato starch 2.5% 
3. Crystallized glucose Manioc starch, sago starch or potato starch 2.5% 
4. Erythorbic acid and derivatives thereof or sorbitol Manioc starch, sago starch or potato starch 2.5% 
 
The imported raw materials for manufacturing export goods on which customs duties may be 
refunded when the goods are exported are the imported  raw materials enumerated in either of the 
following subparagraphs which are us ed for the manufacture of fruits, jams, marmalades, fruit juices, 
nonalcoholic beverages, lactic acid beverages, toma to ketchup or vegetables in cans, bottles, barrels 
or any other containers, liqueurs, powdered milk with added sugar, condensed  milk with added sugar 
or such other goods as may be prescribed by an Ordinance of the Ministry of Finance, whereas the 
amount of customs duty to be refunded is to be the amount provided for in each of the following subparagraphs according to the imported raw materi als enumerated in the subparagraph concerned. 
 
1) Sugar whose content of sucrose by weight, in  the dry state, corresponds to a polarimeter 
reading of 95.8°or higher:  a full amount of cust oms duty (excluding the amount of incidental duty)  WT/TPR/M/211/Add.1 
 Page 311 
 
 
  paid on the imported raw materials, mentioned in th is subparagraph, of the qua ntity equivalent to the 
quantity of sucrose contained in fruits in cans, etc.  2) Sugar whose content of sucrose by weight, in  the dry state, corresponds to a polarimeter 
reading of less than 95.8:  a full amount of custom s duty (excluding the amount of incidental duty) 
paid on the imported raw materials, mentioned in th is subparagraph, of a qu antity of up to 100/95 of 
the quantity of sucrose contained in fruits in cans, etc. 
 
Q28. Does the drawback scheme allow drawback of  duties and taxes paid on energy, fuel and oil 
used in the production process and catalysts which ar e consumed in the course of their use to obtain 
the exported product?  What is the methodology adopt ed for refund of input taxes under the drawback 
scheme?  Please indicate separately the methodology adopted for refund of taxes on inputs that are 
physically incorporated in the exported products a nd the inputs like energy, fuels, oil and catalysts 
which are used in the production process to obtai n the exported product.  How the drawback amount 
is calculated and refunded when a given input im ported under an invoice is used not only in export 
consignments spread over a period of time but also in the production of goods meant for home use?  
 
A. The drawback scheme does not allow for th e drawback of duties and taxes paid on energy, 
fuel and oil used in the production process and in ca talysts which are consumed in the course of 
obtaining an exported product. 
  
CHINA ADD.2
 
 
Q1. Would the Delegation of Japan please provide information regarding small and medium-sized 
enterprises (SMEs) in Japan and assistance to them, including;  
 a) information regarding to the development of SMEs in 2007 and 2008 including, inter alia, the 
tend of development, the number of newly- established and bankrupted SMEs, and possible 
measures in the future to promote the development of SMEs; 
b) legislation, policies, measures as well as relevant budgets allocated to support the 
development of SMEs; 
c) review or evaluation on the effects of th e Law Concerning the Organization of Small and 
Medium Enterprises Organizations 
d) measures taken specifically to help financing SMEs in response to the on-going financial and 
economic crisis. 
 
A. 
a) Japan provides information regarding the trend of development in SMEs, described in 
Figure 1.  The trend in the Japanese economy seriously deteriorates especially after the latter half of 
2008 as a result of the decrease in exports and househol d consumption in the face of global economic 
recession.  Moreover, the trend in en try and exit rates for enterprises can be found in Figure 2.  The 
trend in entry rates is recorded at 3.5% from 2001 to 2004, and at 5.1 % from 2004 to 2006.  The 
reason for this trend is speculated to be the recovery of the economy and measures for managerial 
support.  Japan is taking measures to promote the developmen t of SMEs such as promoting the creation of 
added value in SMEs and the enhancement of each SME's managerial capability.  In addition, Japan 
is promoting their competitiveness and enhancing th e business environment to be fair, reasonable and 
effective, so that the SMEs pro fit from their efforts and capabilities. 
 WT/TPR/M/211/Add.1 
Page 312  
 
  Figure 1.  
(notice) The Diffusion Index (DI) of SME Business Sentiment at the point of IV 2008 is the worst 
recorded since 1994. 
 
The number of samples is about 19,000 SMEs. About 80% of these samples are small enterprises,  which employ 20 workers or less respectively  (5 employees  or less in the sector of retail, 
wholesale  and service).
Source: SME Agency and SMRJ, “Survey on SME Business Conditions”(year/quarter)▲50.0▲45.0▲40.0▲35.0▲30.0▲25.0▲20.0▲15.0▲10.0▲5.00.0
ⅣⅠⅡⅢⅣⅠⅡⅢⅣⅠⅡⅢⅣⅠⅡⅢⅣⅠⅡⅢⅣⅠⅡⅢⅣⅠⅡⅢⅣⅠⅡⅢⅣⅠⅡⅢⅣ
99 00 01 02 03 04 05 06 07 08（ＤＩ）
全体
▲42.0
小規模
▲42.2（前期比季節調整値）
All SMEs
▲42.0
Small
Enterprises
▲42.2Seasonally  adjusted indicesThe DI of SME’s Business Sentiment
 
 
Figure 2. 
5.1%
3.5%5.8%
3.60%
2.7%3.5%4.3%5.9%5.9%6.2%6.1%6.8%
5.6%
3.2%4.0%
4.0%3.8%
3.5%
0.01.02.03.04.05.06.07.08.0
75~78 78~81 81~86 86~91 91~96 96~99 99~01 01~04 04~06
Source :    MIC, Establishment and Enterprise Census of Japan.(%)Trend in entry and exit rate s for enterprises (based on 
number of enterprises) and tr end in number of enterprises
(year)Entry Exit
 
 
  WT/TPR/M/211/Add.1 
 Page 313 
 
 
  b) Japan appropriated a FY 2007 primary SME-rel ated budget which amounted to 162.5 billion 
yen for comprehensive meas ures for SMEs involved in manufac turing and strengthening support for 
promoting community renovation and shopping district s.  It is a 0.6% increase compared with the 
previous year.  Moreover, 275.7 billion yen wa s provided under a supp lemental budget for 
maintaining stable management of the SMEs stri cken by the Mid-Niigata Prefecture Earthquake and 
measures to tackle the surging prices of crude oil. 
 Japan appropriated a FY 2008 primary SME-related  budget which amounted to 167.6 billion yen 
focusing on important measures such as improv ing collaboration between "agriculture, commerce 
and industry" and providing one-stop business support through "Local Network Focal Points."  It is a 
2.2% increase compared with the FY 2007 budget.   Moreover, Japan appropriated supplemental 
budgets twice in the face of the continued surg ing prices of crude oil and the sudden recession.  
917.6 billion yen was provided for measures such  as strengthening safety-net financing. 
 
c) The Laws Concerning the Organization of Small and Medium Enterprises Organizations, 
such as the Small and Medium-Sized Enterprise C ooperatives Act, play a role in promoting the 
voluntary economic activities of persons engaged in  small-sized commercial, industrial, mining, 
transport, service and other businesses as well as ot her workers, securing the opportunity for these 
people to conduct fair economic activities, and adv ancing improvement in their economic status. 
 d) Japan released the "Comprehensive Immediate Po licy Package-Easing Public Anxiety" at the 
end of August 2008.  Japan also created a 6-tr illion-yen Emergency Guarantee System, and the limit 
of Safety-Net financing, which is provided by th e Japan Finance Corporation for SMEs that are 
suffering funding problems, was increased to 3 tr illion yen.  Moreover, in response to the global 
financial unrest, Japan also drew up the "Economic  Policy Package:  Measures to Support People's 
Daily Lives" in October, and decided to increase the limit of the Emergency Guarantee System over 
threefold from 6 trillion yen to 20 trillion yen and the limit of the Safety-Net Guarantee over threefold 
from 3 trillion yen to 10 trillion yen. 
 
Q2. Would the Delegation of Japan please explain the meaning of the "overtime charge system" mentioned in Paragraph 13 of the Report?  Please al so explain the reason for abolishing this system. 
 A. Overtime charges had been required of those who asked for work to be performed beyond 
normal office hours, etc. in respect of beneficiary li ability.  To reduce importers'/exporters' costs and 
improve their convenience, no overtime charges will now be collected by Customs for work performed 
beyond normal office hours, etc.   
 Q3. Paragraph 14 of the Report mentioned that "ite ms requiring approval by the Director-General 
of Customs can be declared before they are taken to the hozei  area".  Would the Delegation of Japan 
please provide the scope of these items?  
A. Almost all items (except some items which require quantitative control of import, for example, 
"specific industrial products, etc." for which a pref erential tariff is applied, and so on) declared by 
Authorized Importers or Authorized Customs Br okers as approved by the Director-General of 
Customs can be declared before th ey are taken to the hozei area. 
 
Q4. With regard to customs evaluation menti oned in Paragraph 16 of the Report, would the 
Delegation of Japan please provide laws and regul ations governing the evaluation process or indicate 
the reference number if they have been notified to the WTO. 
 
A. The valuation process of imported goods is pr escribed in Articles 4 to 4-8 of the Customs 
Tariff Law, Articles 1-4 to 1-12 of the Cabinet Or der for Enforcement of th e Customs Tariff Law, and 
Article 1 of the Regulation for Enforcement of the Customs Tariff Law.  WT/TPR/M/211/Add.1 
Page 314  
 
  Q5. In this paragraph, the report states that Jap an maintains a system of prior confirmation to 
collect data on certain imports, to ensure that th ey are for specific uses, and to verify documentation 
and origin requirements.  What products are covered by this confirmation system? 
A. The articles under the prior confirmation are chemicals used for testing and research, 
vaccines for clinical trials, substances which are listed in the Annex of the Montreal Protocol on 
Substances that Deplete the Ozone Layer and which a re assumed to be restriction exceptions (used as 
raw materials in the manufacturing process of oth er substances, used for testing and research or 
analysis, and used for quarantine upon import and export of goods), and so on.  Japan confirms by document etc. that the article is an import for such  a purpose.  In the plants and the animals listed in 
Annex II or Annex III of the Montreal Protocol on  Substances that Deplete the Ozone Layer, some 
plants and animals are importable by submitting the license based on the Protocol.  Please refer to 
the following website for details:  http:// www.cas.go.jp/jp/seisaku/hourei/data/ITCO.pdf. 
 
Q6. What is the policy of Japan regarding ship survey branches established in Japan by foreign 
ship classification societies?  What are the re gistration process and requirements for these entities? 
 
A. Foreign ship classification societies may ha ve the authorization for inspection of Japanese 
flag ships on behalf of the Japanese Government. In or der to do so, according to the Ship Safety Law 
and so forth, a classification society is required to be registered with the Minister of Land, 
Infrastructure, Transport and Tourism in Japan, and then the ru les, practices and so forth regarding 
ship inspection service of the societ y are required to be approved by the Minister prior to the start of 
the service. 
  THAILAND ADD.1
 
 
Q1. Para 14:  According to the Secretariat repor t, Japan maintains quantitative import restrictions 
on some fish.  Could Japan kindly clarify the details of  the fish and other products that are subject to 
quantitative restrictions, and also provide de tails regarding any quota administration?  
 
A. Import quota allocations have been establishe d for the following products as well as the 
substances which are listed in the Annex of the Montreal Protocol on Substances that Deplete the 
Ozone Layer in accordance with the Import Tr ade Control Order, Article 3 and the Foreign 
Exchange and Foreign Trade Act.  ("Ex" indicates that only a part of the heading is covered.) 
 
 HS No.  Description of Goods  ex 03.01 Herring, Cod, Yellowtail, Mackerel, Sardine, Horsemackerel,   ex 03.02 Saury, Roes of Cod and Niboshi (small boiled and dried fish for seasoning)-- 
live, fresh, chilled, frozen, dried, salted or in brine 
 ex 03.03 
 ex 03.04 
 ex 03.05  ex 03.07 Scallops, adductors of shellfish,  cuttlefish and squid (excluding "Mongo ika") 
 ex 12.12 Edible seaweeds and foods prepared with them   ex 21.06 
 
Q2. Has Japan ever imposed any provisional SPS measures?  If so, please provide details 
regarding the products, origin and reasons.   
A. Japan has been taking provisional SPS measures.  WT/TPR/M/211/Add.1 
 Page 315 
 
 
  Q3. Regarding rice subsidies, we note that Japan's  most recently notified subsidies were for fiscal 
years 2005 and 2006 (G/AG/N/JPN/132 and 137, circulated on 17/3/2008 and 1/7/2008, respectively), in which Japan notified rice subsidies under both AMS (de minimis) and Blue Box.  If possible, could 
Japan please provide updated information on the total am ount of trade distorting subsidies provided to 
rice farmers for fiscal years 2007 and 2008? 
 
A. Japan is planning to notify the Secretariat in due course as to the amount of support for 2007 
and 2008. 
 
Q4. Could Japan also indicate whether it has ever re-exported rice and rice products imported 
under WTO tariff rate quotas? 
 
A. Some of the imported rice has been used for international food aid. 
  
PAKISTAN ADD.1
 
 
Q1. Could Japan explain the eligibility criteria for their GSP scheme?  
A. Japan grants preferential tariff treatment under its GSP scheme to 141 developing countries 
and 14 territories.  The criteria for the beneficiaries are as follows:  
 a) Economy of the country or the territory is in the development stage b) The country or the territory has its own tariff and trade system c) The country or the territory desires to be granted preferential tar iff treatment under the 
scheme 
d) The country or the territory is admitted to be  eligible to enjoy the benefit of the scheme 
 The beneficiaries are designated by Cabinet order. 
 
Q2. Could Japan explain the salient features of the program and their strategy to achieve that 
desired objectives? 
 
A. The Council for the Promotion of Regulatory Reform (CPRR) was established in 
January 2007 as an advisory body to the Prime Mini ster for the purpose of accelerating regulatory 
reforms.  The CPRR has investigated and deliberate d over reform issues and reported those outcomes 
to the Prime Minister.  The Government of Japan, complying with the outcome reports by the CPRR, 
has created and updated "The Three- Year Program for Promoting Re gulatory Reform."  Based on 
that, each ministry executes specific measures in  accordance with the program.  The CPRR also 
monitors and reviews every year how the goals of each specific measure are being achieved. 
 
Q3. Japanese authorities may like to share details of their Intellectual Property Strategy Program 
(IPSP) and how it is focused on strengtheni ng Japan’s international competitiveness? 
 
A. The Intellectual Property Strategic Programme  (IPSP) for 2008 aims to strengthen Japan's 
international competitiveness setting following 3 targets: 
 
- Leading the World in the Fields of Cutting- Edge Technology and Achieving Innovation of 
Society as a Whole; 
- Making Further Use of the Greatest Inform ation and Communication Infrastructure in the 
World;  and  
- Supporting SMEs and Venture Companies as Le aders for Exploring New Business Fields. 
 WT/TPR/M/211/Add.1 
Page 316  
 
  For the details, please see pages 5 to 13 of IPSP 2008. 
http://www.kantei.go.jp/jp/singi/titeki2/keikaku2008_e.pdf. 
 
Q4. Would Japan inform about relevant laws  where parallel importation is incorporated. 
 A. The relevant provisions of the Patent Act are Article 2(3) (definition of "working") and 
Article 68 (effects of patent rights).  Although par allel importation is not excluded from the definition 
of "working" of an invention, in the context of  "international exhaustion," there is an argument that 
parallel importation should not be regarde d as an infringement of patent rights.  
 
Concerning parallel importation of patented goods, the Judgment of the Supreme Court (Date of the 
judgment: 1997.07.01,BBS Case) clarified that paten t holders may not exercise their rights in Japan 
concerning products which are assigned outside of  Japan and imported (parallel importation) except 
for certain circumstances, stating that if a patent holder in Japan or an equivalent person assigns a patented product outside of Japan to another person, the patent holder, unless there is an agreement 
with the assignee excluding Japan from the areas of sa le or use of the said product, may not seek an 
injunction in Japan concerning the patented product on the basis of the patent right against the person who acquired the product from the assignee,  except in cases where the above agreement has 
been made and is explicitly indicated on the product.  Informal translation of the Judgment: http:// www.courts.go.jp/english/judgments/text/1997.07.01-
1995-O-No.1988.html  
Informal translation of the Patent Act: ht tp://www.cas.go.jp/jp/seisaku/hourei/data /PA.pdf 
Regarding Copyright, please refer to Article26bis(2 )(iv), Article95bis(3)(iii) Article97bis(2)(iii) and 
Article113(5) which are related to "international exhaustion."  Informal translation of the Copyright Law : http://www.cric.or. jp/cric_e/clj/clj.html 
 
Q5. What are those factors, which resulted in decreasing the price of energy in Japan? 
 
A. Since the electricity industry system reforms started in 1995, the principle of competition was 
introduced with the securing of a stable power supp ly;  and a liberalization campaign was launched 
first in the power generation segment and then in the sales segment.  As a result, electricity charges 
have declined by some 20% since 1995.   
Q6. Whether Japanese Government has any program to liberalize the rice market? 
 
A. Japan has been implementing and will implement any measures in line with the WTO 
agreements for all agricultural products.   
Q7. Would Japan indicate time frame for converting non- ad valorem  duties to ad valorem  duties? 
 
A. The application of non-ad valorem tariffs  on certain agricultural products in Japan is 
consistent with the WTO Agreements.  Japan will con tinue its efforts to set appropriate tariff types 
and levels considering the result of the DDA negotiations.   
Q8. Could Japan inform that how they would achie ve their target with limited liberalization of 
agricultural market?  A. The action that Japan carries out to achieve the target is as follows.   - Advertising Japanese high-quality foods in foreign countries. - Providing export-related information to the Japanese producers.  WT/TPR/M/211/Add.1 
 Page 317 
 
 
  GUATEMALA  
 
Q1. Could Japan provide more details regarding the content and scope of the "comprehensive 
immediate policy package-Easing Public Anxiety" and the "Economic Policy Package: Measures to 
Support People's Daily Lives"? 
 
A. Taking into account the current economic and financial environment since August 2008, 
Japan has already formulated three economic pol icy packages and implemented parts of these 
packages.  Please refer to the websit es below for further information. 
 
These packages will support employment and cor porate financing and improve the Japanese 
economy.  "Immediate Policy Package to Safeguard People's Daily Lives" http://www5.cao.go.jp/keizai1/2008/081224summary-english.pdf 
 
"Economic Policy Package:  Measures to Support People's Daily Lives" http://www5.cao.go.jp/keizai1/2008/081201outline-english.pdf  "Comprehensive Immediate Policy Pack age – Easing Public Anxiety" 
http://www5.cao.go.jp/keizai1/2 008/0918summary-english.pdf 
 
Q2. In section 3, paragraph 13, page 7 of the G overnment report, Japan states that an Expert 
Committee was established to promot e Foreign Direct Investment (FDI).  Could Japan explain how 
this Committee is put together, what its functions ar e and if it still exists?  Th at same paragraph lists 
five recommendations which the Committee made for increasing short-term FDI in Japan.  Could 
Japan explain what specific actions have been designed in order to implement these recommendations?  Has any system been established for evaluating these actions?  
A. The Expert Committee on FDI Promotion, composed of researchers, Japanese and foreign 
businesspeople and others, is an advisory body to the Minister of State for Economics and Fiscal 
Policy.  The Japan Investment Council (JIC), chaired by the Prime Minister, was abolished in 
December 2007.  Following that, the Expert Comm ittee was established in January 2008.  The main 
function of the committee is gathering information for improving Japan's investment environment and 
examining issues related to the promotion of in vestment.  The Expert Committee published "Five 
Recommendations Toward the Drastic Expansion of Foreign Direct Investment in Japan" in 
May 2008 to promote further FDI in Japan.  
 To achieve the goal to double FDI to around 5% of GDP in five years by the end of 2010 set in 
March 2006, in June 2006 Japan launched a program called the "Program for the Promotion of FDI 
in Japan" which focuses on 3 key issues:  (1) the promotion of investment in local regions (2) the 
improvement of comprehensive investment environment with a sense of urgency, and (3) the 
promotion of greater understanding th rough public information activities.   To promote further FDI in 
Japan, Japan revised "the Program for the Acceleration of Foreign Direct Investment in Japan" in December 2008 in order to incorporate th e Five Recommendations in the program. 
 
The Recommendations and the program are available at: 
http://www5.cao.go.jp/invest-japan/index.html 
 WT/TPR/M/211/Add.1 
Page 318  
 
  Appendix 
 Members of the Expert Committee for FDI Promotion  (Chair) Haruo Shimada  President, Chiba University of Commerce  
Chairman, Fujitsu Research Institute  
 Mitsue Aizawa  Attorney-at-Law, Bingham McCutchen Murase Sakai Mimura Aizawa Foreign Law Joint Enterprise  
 
Allan D. Smith  
President, American Chamber of Commerce in Japan   Takatoshi Ito  Professor, Faculty of Economics and Graduate School of Public Policy, University of Tokyo  
 
Shujiro Urata  Professor, Graduate School of Asia-Pacific Studies, Waseda University   Toshiko Oka  Chief Executive Officer, Abeam M&A Consulting Ltd.  
 
Hao Yan President and CEO, EPS Co., Ltd.   Masaharu Shibata  
Chairman, NGK Insulators, Ltd.  
 Uichiro Niwa  Chairman of the Board, ITOCHU Corporation   Yasuo Hayashi  
Chairman and CEO, Japan External Trade Organization  
 Shigeki Morinobu Professor, Chuo Law School   
Tetsuzo Yamamoto  
Professor, School of Comm erce, Waseda University  
 Richard Collasse  Chairman, European Business Council in Japan   
Robert Alan Feldman  
Managing Director, Morgan Stanley Japan Securities Co., Ltd. 
 
Q3. In section 3(9) of the Government report, Japan recognizes that the Doha Development Agenda should contribute to the facilitation of deve loping countries' integration into the multilateral 
trading system by effectively responding to the in terests and concerns of those countries.  Does Japan 
believe that a substantial and real  opening of the industrialized countries' global agricultural markets 
would contribute to developing countries' in tegration in the multilateral trading system? 
  WT/TPR/M/211/Add.1 
 Page 319 
 
 
  A. Japan believes that the DDA would and should result in facilitation of developing countries’ 
integration into the multilateral trading system.  Fo r the purpose of helping developing countries to 
maintain and expand market access opportunities fo r their products, Japan has been providing 
assistance through its "Development Initiati ve for Trade" announced in December 2005. 
 Q4. In the Government report, section 6(1), FTA/ EPAs, paragraph 53, page 14, Japan indicates 
that it has strengthened its regional and bilatera l trade policies as a means of complementing the 
multilateral trading system, particularly by negotia ting economic partnership ag reements that include 
elements of free trade agreements and institution-bu ilding.  Could Japan elaborate on the content of 
the economic partnership agreem ents, particularly those elements which go beyond free trade 
agreements?  Also, could Japan explain whether, in relation to free trade issues, these agreements 
cover the traditional topics of market access for goods, as well as other elements, such as services, investment and intellectual property?  Could Japan  indicate what criteria it uses to determine with 
which trading partners it enters into agreements of this type? 
 A. Japan's Economic Pa rtnership Agreements are concluded w ith the aim of enhancing overall 
economic partnership with the partner countries.  Th ey are, in general, co mprehensive in scope, 
covering not only trade in goods and services but also such fields as investment, intellectual property, competition, customs procedures, sanitary and phyt osanitary measures, technical barriers to trade, 
movement of natural persons,  improvement of the business environment, and cooperation.  The range 
of fields covered differs by agreement.  
 
As for future EPAs, Japan continues to examine, in a comprehensive manner, possible EPA partners, 
giving due consideration to various viewpoints such as the creation of an international environment 
beneficial to Japan, ensuring Japan's economic interest  as a whole, the current situation of possible 
partner countries and regions as well as the feasibility of each EPA. 
 
Q5. In the Government report, section 8(4), Japan  states that one of the policy objectives for 
agriculture adopted by the Cabinet is "to make  full use of the potential productive capacity of 
agriculture and to develop agriculture as a strategi cally important industry for the 21st century".  
Could Japan explain what specific measures have been  adopted for the attainment of this particular 
objective? 
 
A. Japan has adopted various measur es to achieve this objective th rough, inter alia, (1) periodic 
announcements on food supply and demand conditions with a view to analyzing and sharing the information about the global food situation, (2) international cooperation, such as technical training in agriculture in developing countries (rice cultiv ation), (3) promoting core farmers through the 
implementation of a new direct payment system and assistance to new farmers, (4) developing 
technologies which contribute to the growth of ma nagement and reductions in cost and (5) protecting 
and making use of intellectual property in agriculture.   
 
Q6. In the report by the Secretariat, in the s ection on "Standards, and sanitary and phytosanitary 
measures", subsection (a), paragraph 49, it is stated  that:  "Under the JAS Law (the Law Concerning 
Standardization and Proper Labelling of Agriculture and Forestry Products), third-party organizations 
are entitled to certify operators (e.g. manufacturers) to affix JAS marks."  Could Japan indicate the 
procedure, requirements and timeline for certifying  operators or for being a certifying agency, 
indicating whether the timelines and requirements diffe r for nationals and foreigners?  Could it also 
indicate how many requests have been received and how many certifying agencies have been 
approved? 
 
A. 131 Certifying Bodies (Registered Certify ing Bodies (RCBs) and Registered Overseas 
Certifying Bodies (ROCBs) have been registered as of February 2009.  WT/TPR/M/211/Add.1 
Page 320  
 
  The procedure necessary for registra tion of Certifying Bodies such as RCBs and ROCBs is as follows: 
 Step 1: Submit an application form to the Mi nister of Agriculture, Forestry and Fisheries (MAFF). 
Step 2: After MAFF confirms the submission of  the required documents and the payment of the 
registration fee and registration license tax, th e Incorporated Administrative Agency, the 
Food and Agricultural Materials Inspection Ce nter (hereafter as to "FAMIC"), carries out 
documentary examination and on-site inspection in  order to decide whether the applicant 
conforms to registration criteria. FAMIC then  reports the result of the examination to the 
Minister of MAFF. 
Step 3: If FAMIC reports that the applicant conf orms to registration criteria and the MAFF confirms 
the report, the applicant will be registere d as an ROCB by the Minister of MAFF. 
 Please refer to the following website for application form: 
http://www.maff.go.jp/soshiki/syok uhin/hinshitu/e_label/index.htm 
 Q7. In the report by the Secretariat, under(2) Agricu lture, (ii) Policy development, paragraph 11, it 
is stated that:  "Tariff rate quotas (TRQs), which cover 1.8% of all tariff lines, apply mainly to 
agricultural products, including rice, milk and dair y products (skim milk powder, whey, butter, butter 
oil, prepared edible fat), dried leguminous vegeta bles, wheat, barley, ground nuts, tubers of konnyaku, 
starches, and silk-worm cocoons and raw silk.  Th e extent to which tariff quotas are filled varies by 
product (Table AIV.1).  Quota-fill rates are below 50% for skimmed milk powder, prepared whey for 
infant formula, butter and butter oil, mineral con centrated whey, tubers of kinnyaku, and silk-worm 
cocoons and raw silk.  The administration of TR Qs has not changed since the previous Review 
Eligibility for quota allocations may require prior appr oval by the MAFF and tends to be intricate;  it 
may require, for example, various end-use restri ctions and many documents, such as accounts and 
business plans."  Could Japan indicate the reasons  why tariff quotas are underfilled and whether it 
plans to introduce short-term improvements to the administration system to ensure the fulfilment of 
tariff quotas?  
A. With regard to agricultura l products, Japan considers the tar iff quota filling rate of a product 
to accurately reflect the balance between th e product's quota size and the actual demand for the 
import of the product in the domestic market.  
 
Japan is convinced that its administration of the tariff quotas is appropriate  and conducted in a fair 
and transparent manner, based on the characteristics of each product.  Therefore, Japan has no concrete plans to change the existing administration of the tariff quotas. 
 
Q8. Could Japan list the products, at the HS nine -digit level, in accordance with the Temporary 
Customs Tariff Measures Law, the tariff lines [of] which were subject to temporary rates in FY2008? 
 
A. To find the tariff lines which are subject to temporary tariffs, the following website would be 
useful: http://www.customs.go.jp /english/tariff/2008_4/index.htm. 
 
Please refer to the Temporary tariff rates in the fifth column of each table. 
 
 
UNITED STATES FOLLOW-UP QUESTION
 
 
Q1. (Q A2-3) While it is mentioned in Japan's res ponse to Q2-2 that "Japan does not believe they 
provide the same services in the same market as  of this moment" with respect to EMS and 
international express carrier services, how does Japan ju stify that view in light of a report by Japan's 
competition policy authority, the Japan Fair Trad e Commission, in April 2006 on the competitive  WT/TPR/M/211/Add.1 
 Page 321 
 
 
  relationship between postal express services and pr ivate express services?  That report found many 
similarities in the services and analyzed the inte rnational express market as one that includes EMS 
and private services alike (a conclusion that was similarly drawn with resp ect to Japan Post's and 
private domestic express services)?  A. The report of the Japan Fair Trade Commission was issued in 2006, and it is submitted as 
one possible opinion.  It should be noted that the contents of the report do not represent the official 
understanding of the Government of Japan. 
 
Q2. (Q-6) In light of this reading of the "substan tially all trade" requirement in Article XXIV and 
according to the WTO Secretariat's Factual Presentation of the Japan-Mexico EPA (WT/REG198/4), 
it would appear that Japan's unwillingness to liber alize as much as its developing country partner 
Mexico calls into question the consistency of th at agreement with GATT Article XXIV.  Does Japan 
envision taking steps to eliminate duties on more pr oducts with a view to bringing this agreement 
under the terms of GATT Article XXIV? 
 
A. Japan is of the view that this EPA does fu lfill the "substantially all the trade" requirement. 
GATT Article XXIV paragraph 8 does not specify a quantitative benchmark of "substantially all the 
trade."  It is under consideration in RTA rules negotiations.  With regard to matters related to market access, Japan and Mexico will consult with each other in the 
relevant Sub-Committees est ablished under this EPA. 
 
Q3. (Q 9-2) Japan stated in its response to Q9-2 , that 86 of 100 IAAs are covered by the GPA, and 
in its response to Q9-4 that 50 IAAs had been adde d to Annex 3 of the GPA.  Were the other 36 IAAs 
added to another Annex of the GPA?  If not, pl ease explain how they are covered by the GPA? 
 
A. When "IAAs" started operating as a part of Japan's central government reform, Japan added 
into Annex 3 more than 50 IAAs.  All IAAs which are covered by the GPA are included in Annex 3. 
 
Q4. (Q9-5(2)) Does the Ministry of Land, Infrast ructure, Transport and Tourism (MLIT) review 
each proposed use of Note 4(a) ("procurement rela ted to operational safety of transportation") by 
Annex 3 entities?  Given Japan's report of the exte nsive use of the comparable Note 5 by Annex 2 
entities, does MLIT intend to engage in a more dilig ent review of the use of the Note by Annexes 2 
and 3 entities and to undertake efforts to reduce its use?  
A. There is no statistical data available on the application of the Note  as regards entities in 
Japan's Annex 3.  However, in order to assure its proper application, the Ministry of Land, 
Infrastructure, Transport and Tour ism (MLIT) is, as appropriate, requesting the procuring entities 
(incorporated administrative agency and special co mpanies) listed in Annex 3 to apply the Note 
strictly, and to refer to the MLIT in advance when qu estions arise in deciding on the applications of 
the Note.  To give one example, in November 2006, the Director-General of the Railway Bureau, 
MLIT has issued the notification on the application of  the Note to the Presidents of the JRs which 
were the special companies, requesting that they apply the Note strictly and narrowly.  
With regard to sub-central government entities lis ted in Annex 2, the responsible authorities have 
been providing advices for them so that they can conduct procurement applying the GPA properly. 
The authorities will continue to do so, if necessary, with cooperation with MLIT. 
 
Q5. (Q10) In its response to Q10, Japan stat es that the Japan Aerospace Exploration Agency 
(JAXA) has assumed the functions of the National Aerospace Laboratory (NAL ), and asserts without 
any discussion that the withdrawal of NAL would ha ve "negligibly-small" effect on coverage.  Please WT/TPR/M/211/Add.1 
Page 322  
 
  describe the NAL functions that were assumed by J AXA, and the basis for Japan's assertion that they 
would have a negligible effect on mutually agreed coverage.  
A. The NAL functions that were assumed by JAXA are basic and fundamental research relating 
to aerospace science and technology . 
 The average statistics for the three-year peri od between 2000 and 2002 suggest that the proposed 
modification may affect approximately 12 procurement contracts, the total amount of which would be 
¥2.578 billion in one year.  For your reference,  these changes could reduce the total procurement 
contracts for Annex 1 and Annex 3 entities by 0.08% in number and 0.26% in amount.  The change 
would be negligibly small in the level  of mutually agreed coverage if any. 
 
(A)  
Procurements by Annex 1 and 3 
entities* (B)  
Procurements by NAL** (C) = (B) / (A)  
Share of NAL's procurements in 
total procurements by Annex 1 and 3 
entities Year 
Amount of Contracts 
(Unit: ¥100 million) Number of 
Contracts Amount of Contracts
(Unit: ¥100 million) Number of 
Contracts Amount of 
Contracts Number of 
Contracts 
2000 10,431 15,348 22.64 9 0.22% 0.06% 
2001 10,146 14,848 37.53 10 0.37% 0.07% 
2002 9,690 15,739 17.18 18 0.18% 0.11% 
Total 30,267 45,935 77.35 37 - - 
Average 10,089 15,312 25.78  12.3  0.26% 0.08% 
 
*Source:  Chapter II. Japan's Government Proc urement Policy and Achievements Annual Report 
(FY2006 Version) (http://www.kantei.go.jp/foreign/procurement/2006/index.html)  
**Statistics on procurements each value of which is not less than 130 thousands SDR. 
 
Q6. Q11 and Q14-2) In responses to both Q11 and Q14-2, which asked for descriptions of 
"competitive bidding methods" and "open tendering," Japan only referred to its Accounts Law.  The 
United States again repeats its request for a desc ription of these procurement methods, including the 
qualification requirements for participation in these tendering procedures.   
A. Scaled tenders must be submitted to the desi gnated place before the deadline as specified by a 
notice in the official gazette Kanpo or its equivalent s at the local level.  Tenders may be submitted in 
person, by a proxy, or by mail, provided that th e submission is completed before the deadline for the 
receipt of tenders.  Tenders, once submitted, cannot be replaced, modified or canceled.  Tenders can 
be submitted by Internet to some procuring entities.  In addition, "unified qualification for participating in tendering contracts for manufacturing and sales 
of products" corresponds to the qualification requiremen ts for participation in tendering procedures. 
To the extent that fairness of competition is not im paired, each procuring entity  is allowed to specify 
qualifications of suppliers to participate in the competitive tendering procedures and review their 
capabilities for implementing contracts, including the scale of business activities and their past business performance.  By inviting qualified suppl iers with sufficient capabilities, the procuring 
entities can award contracts to the suppliers that hav e the ability to implement them, while ensuring 
the transparency of the tendering procedures. 
 
Regarding "unified qualification for participating in tendering contracts for manufacturing and sales 
of products," please refer to the following website:  http://www.chotatujoho.go.jp/va/com/KOUJI.html (Only available in Japanese) 
  WT/TPR/M/211/Add.1 
 Page 323 
 
 
  Q7. (Q16-2) Why were construction, architectur al, engineering and other technical services 
excluded from the extension of the tendering period?   
A. Construction service, design and consulting services are covered by the "Action Plan on 
Reform of the Bidding and Contrac ting Procedures for Public Works," not by the "Action Program on 
Government Procurement."  The Action Plan is cons istent with the GPA, and the Government of 
Japan conducts government procurements through transparent and non-discriminatory procedures in 
accordance with the GPA and the Action Plan. 
 
Q8. (Q16-3) From Japan's response to Q16-3 ("Th e unified qualifications are applied to open 
tendering and designated bidding for the manufactu ring and sale of products."), is it correct to 
understand that the same qualifications requireme nts are applied to both open tendering and 
designated bidding?  
A. Yes, the same qualificati on requirements are applied to both open tendering and designated 
bidding.  
Q9. (QA23) Please provide further information on th e apparent inconsistency in Japan's approach 
to the use of ex officio authority with regard to copyrights as it appears, from Japan's answer to Q23, 
that ex officio authority is only applied to trademark and patent infringement?  
 A. Acts of infringement of copyrights violate private rights protected under the Copyright Law and can include various kinds and scales of acts. In addition, copyrights include the moral rights of authors and performers as well as their economic rights, which make them different from industrial 
property rights such as patents.  Therefore, J apan considers it appropriate that the pursuit of criminal 
liability is left to the discretion of the right-holders and it is unnecessary to prosecute copyright 
crimes under ex officio authority in cases where the rights-holders a re not willing to seek prosecution 
of the violators.  It should also be noted that, although industrial  property laws and the Copyright Law constitute 
intellectual property law, the purpose and effects of their respective systems differ and, hence, Japan 
considers it unnecessary to take the same approach 
 
Q10. (QA32) In Japan's answer to Q32, it stat es that Japan Post Insura nce was "privatized" in 
October 2007, when Japan Post Holdings took owners hip of the entity.  Is it true that Japan Post 
Holdings is fully owned by the Government of Japan?   If so, how is this situ ation consistent with the 
statement that the transfer of Japan Post Insurance to ownershi p by Japan Post Holdings was a 
"privatization"? 
 
A. In October 2007, when the privatization wa s implemented, Japan Post Insurance (JPI) that 
was established based on Companies Act inherited the function of the public corporation's postal life 
insurance and started the insurance business under th e Insurance Business Law.   Because regulations 
based on the Insurance Business Law are applied to JPI in the same way as to other private insurance 
companies, for instance, the insurance products so ld by JPI are not guaranteed by the government, 
and even in case of its bankruptcy, necessary meas ures are taken under the sa fety-net scheme applied 
to a bankrupt insurance company in general.  The government has fully owned Japan Post Holdings since the privatiz ation.  Under laws related to 
the privatization of postal services, it has to ret ain possession of more than one third of the shares, 
and is scheduled to dispose the rest.  Also, Japan Post  Holdings is obliged to dispose of all of the 
shares it holds in Japan Post Insur ance no later than September 30, 2017. 
 WT/TPR/M/211/Add.1 
Page 324  
 
  Q11. (QA33) Given the apparent in consistency, as described in Japan 's answer to Q33, between the 
treatment of foreign insurance companies incorporated  in Japan and the treatment of foreign insurance 
companies that operate in Japan w ith sub-branches, is there any plan to update the relevant laws to 
address this?  A. Foreign insurance companies, in the form  of branches in Japan as well as locally-
incorporated subsidiaries, are allowed to c onduct insurance business in Japan, reflecting the 
internationalization of financial services.  The relev ant laws and regulations in this regard are not 
scheduled to be revised at present. 
 Q12. (SPS Q1) Organics:   
 Please explain how Japan's zero tolerance policy fo r transgenic organisms complies with Codex 
Guidelines in light of this guidance from CODE X?  Further, please explain how often domestic 
products are tested and how Japanese regulatory ag encies ensure that organic products produced in 
Japan are completely free of residu es despite environmental pollution? 
 
A. The Japanese Agricultural Standard for Or ganic Plants (hereafter referred to as the 
"Organic JAS standard") stipulates that organic pro ducts should be produced in a way that reduces 
the load on the environment as much as possible through avoiding use of chem ical synthetic fertilizers 
and pesticides and through promoting farmland productivity derived from its soils with a view to 
sustaining and enhancing the natural recycling function of  agriculture.  This principle is consistent 
with the CODEX Guideline for the Production, Processing, Labelling and Marketing of Organically 
Produced Foods.  The JAS law does not allow organic agricultural products to be mixed with prohibited substances, while there is no specific provision concerning pesticide residues in the 
Organic JAS standard. 
 
The written document created by the CODEX secret ariat on zero tolerance policy which we received 
through the USDA will be discussed with stakehol ders for the next revision of the Organic JAS 
standard.  As for test methods, gas chromatography met hods and liquid chromatography methods have been 
used for both domestic and imported organic JAS pro ducts.  Approximately 750 samples are analyzed 
in a year.  The results of most of these analyses are ND (Non-detectable). 
 
Q13. (SPS Q2) MRL Enforcement Program:  
In light of this, can Japan please explain how it just ifies its stringent policy regarding enforcement of 
maximum residue levels which penalizes an entire i ndustry in an exporting country due to a violation 
incurred by a single supplier from that country?     Second, could Japan please explain how it justifies its  enforcement regime in light of Article 5.6 of 
the Agreement?   
 
In Japan's response to Question 18-3,the governme nt acknowledges that domestic violations are not 
subject to the same inspection systems as for im port foods and that control measures follow Japan 
MRL policy and laws.  How does Japan justify its policy of subjecting domestic and imported 
horticultural products to different rules in light of  Article 2.3 of the SPS Agreement?  (Article 2.3 
states that "Members shall ensure that their SPS measures do not arbitrarily or unjustifiably 
discriminate between Members where identical or si milar conditions prevail, including between their 
own territory and that of other Members.")  Fina lly, violations by importers are immediately posted 
on MHLW's website.  Please provide the informatio n on the number of domestic pesticide tolerance  WT/TPR/M/211/Add.1 
 Page 325 
 
 
  violations that have occurred since January 20 06 under your enforcement program and why MHLW 
does not publish these violations  in a consolidated list as it does in the case of imports?  
 
A. Equivalence measures are provided for in  Article 4 paragraph 1 of the Agreement on 
Sanitary and Phytosanitary (SPS) Measures.  The conferment of equal recognition is held in 
paragraph 2 of this Article.  An "Appropriate O pportunity" as described in Article 4 paragraph 1 of 
the SPS Measures, is given at the time of import.  Fu rthermore, "conferment" is carried out from start 
to finish indicated in paragraph 2 of the same article. 
In Food Sanitation Law, establishment of "princip le of inspection and guidance" is prescribed by 
Article 22.  MHLW and local governments shall estab lish, according to the principle, plans for 
inspection and guidance respectively in accordance with Article 23 and Article 24.  Also, in 
accordance with Article 63, whether on domestic s or imports, MHLW and local government publish 
information of violations.  So there is no "poli cy of subjecting domestic and imported horticultural 
products to different rules".  In addition, the said pr inciple prescribes a basic view of the role between 
MHLW and local governments at the accession of inspection and guidance, and defines that the 
inspection and guidance for domestic products be  carried out by local governments.  Local 
governments publish information of domestic violations  on their website in this way. For reference, 
below is an URL for the Metropolis of Tokyo's webs ite, which can be followed through the URL that 
has been showed in the last answer. http://www.fukushihoken.metro.tokyo .jp/kenkou/anzen/ihansya/index.html 
 Q14. (SPS Q3) Post Harvest Fungicides: 
 The United States wishes to thank Japan for its explanation of specific provisions of the Food 
Sanitation law.  The law requires two risk assessments  for the same product.  In light of Article V of 
the SPS Agreement, how does Japan justify this requi rement and the requirement that each assessment 
be conducted by different ministries in Japan?  
 
A. When the Ministry of Health, Labour and Welfare (MHLW) requests the Food Safety 
Commission (FSC) to carry out risk assessment of th e pesticides used both before and after harvesting 
as the 'pesticide residues' and the 'food additives'  in accordance with provisions of the Food 
Sanitation Law, FSC conducts risk assessment bot h by Pesticides Expert Committee and Food 
Additives Expert Committee.  The two expert comm ittees cooperate with each other to make the 
assessment process efficient.  Then the MHLW sets MRLs for them as pesticides, and authorizes them 
and establishes their usage standards etc. as food additives under the Food Sanitation Law, based on 
the result of risk assessment by the FSC.  
Therefore, each authority assumes a different role , and the risk assessment is not conducted by 
different authorities.  Also the regulation on pestic ides used after harvesting in Japan is as replied as 
previously.   EC FOLLOW-UP QUESTION
 
 
Q1. As part of its settlement with Canada, the EC, and the US of the Liquor Tax case, Japan has 
commited to apply a tariff of zero from 1 April 2002 for spirits from the EC.  While Japan has implemented the zero tariff on a permanent basis for brown spirits, the duty exemption for white 
spiritis is subject to annual renewal.  Could Japan  inform how it intends to deal with the annual 
renewal of duty exemption for white spirits and whet her it is considering to make this duty exemption 
permanent, as is the case for brown spirits?  WT/TPR/M/211/Add.1 
Page 326  
 
  A. Under Japanese law, tariffs for both brow n spirits (ex. 2208.30) and white spirits 
(ex.2208.50, 2208.60, 2208.70) are above zero on a permanent basis, while applied tariffs on both 
products have been set at zero, subject to annual ren ewal, which reflects the results of some previous 
negotiations.  
Japan will continue to engage in the discussion at the WTO in a constructive manner, and set 
appropriate tariffs, considering the prog ress and results of the DDA negotiations. 
 
Q2. With reference to Q35 as previously submitte d by the EC, we find some of the figures which 
Japan has provided in response difficult to understand.  
a) Could Japan clarify whether the table fo r Annex 1 entities (central government) includes 
construction services under the heading "Services"? 
b) For procurement of Annex 2 entities, the av erage provided appears to fall far below the 
thresholds of the GPA for both architectural services and construction services. 
 A. a) Regarding Q35, the data shown on the tabl e are based upon the Action Program. Public 
works (including construction work, architectural, engineering and other technical services) are excluded from the program. 
b) The figures provided in the table in our response to EC Q35 are not shown in SDR, but in 
Japanese yen.  In regard to Japan’s Annex 2, the threshold of construction services was 
2.41 billion yen which was equivalent to 15 million SDR, and that of architectural, 
engineering and other technical services covered by the GPA was 240 million yen which was equivalent to 1.5 million SDR in FY 2006 thr ough FY 2007.  Therefore, the average figures 
for those services are well above th e thresholds of the GPA. 
 Q3. With reference to Q36, could Japan clarify why the Action Program on Government 
Procurement does not include Annex 2 entities?   
A. The Action Program is an initiative of the centr al government and its agencies concerned, i.e. 
entities in Annex 1 and 3.  In Japan, it is secu red by law that local governments conduct their 
operations, including government proc urement, on their own initiative. 
 
Q4. Following-up on Q40 on the operational safety clause:  a) Does the scope of the operational safety clause vary over time?  b) Could Japan provide concrete example of what is covered under "Supplies forming railway 
facilities"?  Does that include, for instance, signalling equipment?  
c) Could Japan clarify what it implies by "Besid es, whether to apply this clause or not should be 
judged by each product or service"?  Does it imply that other products or services could fall under the scope of the operational safety clause? 
 
A. 
a) The five categories referred to  as the scope of the operational safety clause do not vary over 
time.  However, with regard to individual and concrete supplies or services, when new 
supplies or services are invented or impro ved according to technological progress or 
improvement, some of the new supplies or service s might fall under the scope of the safety 
clause, as far as they are related to the operati onal safety of railway transport.  On the other 
hand, those which come to be irrelevant to operational safety, might be excluded from the 
scope of the clause. 
b) "Supplies forming railway facilities" include , for example, ATS (Automatic Train Stop 
equipment, which stops trains  automatically when a driver does not stop at a red light),  WT/TPR/M/211/Add.1 
 Page 327 
 
 
  points, turnout (equipment which enables train to transfer from one track to another), etc. 
Signaling equipment, which you have mentione d in your question, is also included. 
c) (Regarding the first part of the question)  This explanation means that whether to apply this 
clause or not should be judged by each pr oduct or service on a case-by-case basis, depending 
on its necessity with a view to maintaining th e operational safety of railway transport. 
 (Regarding the latter part of the question)  As it is not clear what this question intends to ask 
(for example, it is not clear what “other pr oducts or services” means, etc.), the GOJ cannot 
answer precisely. The GOJ considers that wheth er to apply this clause or not should be 
judged by each product or service on a case-by-case basis. 
 Q5. Following-up on Q42, could Japan clarify what is the difference between review procedures 
for Annex 1 and Annex 2?   
A. A difference in the review procedure between Annex 1 and Annex 2 is that Annex 1 entities 
share a review body while Annex 2 entities have revi ew organizations established in each entity. 
 Q6. With reference to Q43, does Japan consid er that the Council on Government Procurement 
Review is an "impartial and in dependent review body with no interest in the outcome of the 
procurement" within the meaning of Article XX (6) of the GPA?  
A. The "impartial and independent review body" within the meaning of Article XX (6) of the 
GPA is the Government Procurement Review Boar d which is held under the Council on Government 
Procurement Review (CGPR).  The role of the CGPR is to establish a review system of government procurement, and the CGPR 
cannot give opinions on the outcome of the procurement.  
 
Q7. Could Japan provide an answer to Q44 of the EC questionnaire?  
A. The Government Procurement Review Board consists of experts regarding government 
procurement such as scholars and lawyers.  In addition, when a board member has a relationship 
with a complaint, a procuring entity or a participan t, he or she cannot participate in reviewing the 
complaint through the Board.  
Q8. Regarding the reply to our question nr 17 on th e percentage of 'eligible' imports of sensitive 
products actually falling under the ceiling and receive  GSP treatment, the information provided is 
only available in Japanese.  Would it be possible to give a short transcript or explain some key 
figures?  
 
A. With regard to the list, please refer to the following website: 
http://www.mofa.go.jp/policy/economy/gsp/ceiling.pdf 
 
Q9. The EC welcomes the fact that Japan has realized upon its commitment to provide DFQF 
market access for at least 97% of products orig inating from LDCs. However,  we deduct from your 
answer to Q18 that only some 8% of LDC imports  entered duty-free (Y 62,9 bio compared to total 
LDC imports of Y 789 bio).  We therefore remain in terested to learn in what manner and timeframe 
Japan intends to progressively build on the current  98% to achieve the 100% coverage set out in 
Annex F a) i) of the Hong Kong Declaration.  The need to cover all products  is important given the 
concentration of LDC exports on a relatively limite d number of tariff lines.  Furthermore, providing 
meaningful market access to LDCs is particularly acute in the context of the financial and economic 
crisis.  WT/TPR/M/211/Add.1 
Page 328  
 
  A. "The value of imports from LDCs under th e duty-free and quota-free treatment" mentioned in 
the Secretariat Report, page 28, paragraph 52 does not include the value of the imports from LDCs 
on the products of which MFN tariffs are free.  Alt hough it is difficult to show an exact total value of 
imports from LDCs entered duty- free and quota-free, the products on which MFN tariffs are free 
include crude oils (2709.00-900, Y520 bio in  CY2008) and liquefied natural gas (HS2711.11, 
Y108 bio in CY2008), for example.  Considering th ese facts, approximately 100% of products from 
LDCs are supposed to be imported to Japan duty-free and quota-free.  Japan grants DFQF market access to LDCs, covering approximately 98% of all tariff lines, regardless of the progress of DDA negotiations.  Through this measure, J apan has realized upon its 
commitment to provide DFQF market access for at least 97% of products  originating from LDCs as is 
stated in paragraph36 (a) (ii) of Annex F of the Hong Kong Ministerial Declaration. 
 
 
KOREA FOLLOW-UP QUESTION
 
 
Q1. In light of the above, would Japan contempl ate reviewing the existing regulations concerning 
the Incubator program of JETRO, and diversify th e language support provided in association with the 
Incubator program of JETRO?  A. JETRO established the Invest Japan Business Support Center (IBSC) in 2003, which is a one-
stop center for foreign companies that wish to set up business entities in Japan.  IBSC provides 
comprehensive information and services for setting up an entity in Japan.  It also offers free 
temporary offices to foreign companies including SMEs  for their preparation. JETRO also provides 
information on "investment in Japan" in various  languages, including Korean, on their website. 
 
 CHINA FOLLOW-UP QUESTION
 
 
Q1. Information indicates that Japan will implement a "Pet Food Safety Act" on June 1st, 2009. 
The Act will set registration requirements for enterp rises producing pet food to be exported to Japan.  
It will also set detailed safety and labelling re quirements for pet food.  If it is the case, 
 a) Would Japan please provide detailed inform ation on the registration process and other 
requirements? 
b) Does the Japanese government plan to solicit opinions from interested parties including 
foreign enterprises before the implementation of this new act? 
c) When does Japan plan to ma ke notifications to the WTO? 
 A. Law for Ensuring Safety of Pet Food (hereina fter referred to as "the Law") was adopted and 
published in June 2008 with a view to ensuring the safe ty of pet food consumed in Japan.  It will take 
effect on June 1, 2009.  The scope of  the Law is pet food for dogs and cats. 
 
a) Regarding the registration of producing enterp rises, the Law only obliges producing and/or 
importing enterprises in Japan to make notificatio n to the Government of Japan (GOJ).  Foreign 
enterprises which are not operating in Japan are not within the scope of this registration. 
 
The draft proposals of safety standards and items of labeling for pet food were elaborated through 
consultation with experts in last December.  Since then, GOJ has been making its efforts to provide 
the exporting countries with the concrete and detaile d information of these drafts, including through 
explanatory meetings with Embassies in Tokyo including that of your country.   WT/TPR/M/211/Add.1 
 Page 329 
 
 
  With regard to safety standards, the maximum r esidue levels for the known hazards including 
mycotoxins and pesticides were established based on relevant data, including the results of toxicity 
tests, MRLs for livestock feed, and MRLs for pet food set in other countries.  
 
With regard to the labeling, name of pet food, country of origin, best-before date, raw materials, and 
name and address/location of business shall be labele d on the package of pet food in Japanese when 
the pet food is sold in Japan.  GOJ would like the Government of China to inform producing enterprises of pet food in your country 
of these requirements and supervise them in order to  ensure their pet food meets the requirements of 
the Law.  If further information is needed, plea se contact our section in charge (Animal Products 
Safety Division, Food Safety and Consumers Affairs Bureau, Ministry of Agriculture, Forestry and Fisheries) through your Embassy in Tokyo or our Embassy in Beijing.   The Law does not require any additional quarantine cer tificates attesting that the pet food meets the 
requirements under the Law when it is exported to Japan.  
b) In addition to explanatory meetings for Emba ssies mentioned above, GOJ has been providing 
detailed information for and collecting views from pet food industry associations including, as their 
members, the enterprises importing pet food from China and the enterprises producing pet food in 
China. 
 
GOJ is ready to provide and exchange information with  interested countries to implement this system 
in an untroubled manner.  If you have any questi ons or comments, please contact our section in 
charge (Animal Products Safety Division, Food Sa fety and Consumers Affairs Bureau, Ministry of 
Agriculture, Forestry and Fisheries) through your Em bassy in Tokyo or our Embassy in Beijing. GOJ 
is also ready to consider dispatching our officials  to China in order to provide Chinese government 
officials and exporting industries with relevant  information upon formal request by Chinese 
Government.  c) GOJ notified the proposal of "Law concern ing safety assurance of pet food" to WTO 
Members on January 15, 2008 as G/SPS/N/JPN/205, the draft proposal "Enforcement Ordinance of 
Law for Ensuring Safety of Pet Food" on September 3, 2008 as G/SPS/N/JPN/205/Add.1, and the 
draft proposals of "Ministerial Ordinance of Law for Ensuring Safety of Pet Food" and "Ministerial Ordinance of Standards and Specifications for Sa fety of Pet Food" on February 6, 2009 as 
G/SPS/N/JPN/205/Add.2, respectively.  We prov ided sixty days of comment period for each 
notification. The comment period for the draft pr oposals of ministerial ordinances started from 
February 6th of this year.  GOJ will take the s ubmitted comments into account and will start to 
implement the Law on June 1, 2009. 
 
Q2. China would appreciate it if Japan could provide the following information.  a) Is there any market access requirement on electronic products (including both imported 
products and products produced in Japan) for the purpose of environmental protection? 
b) Would Japan please brief us about its implemen tation of the Basel Convention on the Control 
of Trans-boundary Movements of Hazardous Wastes  and Their Disposal? In this regard, what 
laws, regulations and other administrative me asures have been formulated and enforced? 
c) What technical standards have been a dopted respectively in the above two areas? 
 
A. 
a) Japan does not believe that any market access requirements exist at the present time. WT/TPR/M/211/Add.1 
Page 330  
 
  However, there are some measures on electroni c products for the purpose of environmental 
protection.  Regarding such meas ures, there is no differential treatment between imported products 
and domestic products. 
 
For instance, the follo wing measures exist: 
- Law for the Recycling of Specified Kinds of Home Appliances 
- Law for the Promotion of the Effective Utilization of Resources 
- The labeling of electrical and electronic equi pment to indicate the presence of specific 
chemical substances JIS C 0950 
- Law concerning the Rational Use of Energy 
- Top Runner Program  
b) We have the "Law for the Control of Export , Import and Others of Specified Hazardous Waste 
and Other Wastes" for the implementation of the Basel Convention.  
Please refer to the following website for details:  
Outline (English) http://www.env.go.jp/en/laws/recycle/13.html Full text (Japanese only) http://www.env.go.jp/recycle/yugai/law/basel_law.pdf  
c) As for the measures mentioned with respect to 2(a), please refer to the following website for 
details of technical standards. - Law for Recycling of Specified Kinds of Home Appliances   http://www.meti.go.jp/policy/rec ycle/main/english/law/home.html 
- Law for the Promotion of Effective Utilization of Resources 
 http://www.meti.go.jp/policy/recycle/ main/english/law/promotion.html 
- The marking for presence of specific chemic al substances for electrical and electronic 
equipment JIS C 0950 
 http://www.proapplication.com/images/JIS%20C0950%202005_english_version.pdf  http://pc1.db1.co.jp /jeita_eps/jmoss_en.htm 
- Law concerning the Rational Use of Energy 
 http://www.eccj.or.jp/summary/local0703/eng/index.html 
- Top Runner Program  http://www.eccj.or.jp/top_runner/index_contents_e.html  As for identification criteria of hazardous wastes  under the Basel Convention with respect to 2(b), 
Japan has qualitative as well as quantitative standards  which define the materials categorized in 
Annex 1 and having any of the hazardous characteristics in Annex 3 of the Basel Convention.  Please refer to the following website for details:  Full text (Japanese only) http://www.env.go.jp/recycl e/yugai/law/kokuji_s.pdf. 
 
 
THAILAND FOLLOW-UP QUESTION
 
 Q1. Thailand thanks Japan for its second-day r esponses to Thailand's qu estion on tax measures 
facilitating mergers and acquisitions.  Could Japan  please provide more details on the condition of 
these tax measures, especially when compared to th e former tax system mentioned in paragraph 25?  
Do the new tax measures only apply to businesses,  or do they also cover other investments? 
  WT/TPR/M/211/Add.1 
 Page 331 
 
 
  A. 
Tax Measures Concerning Corporate Reorganization Including Corporate Division, Consolidation 
including triangular mergers, etc. <Outline> 
 
1. Taxation on Corporations 
When assets are transferred, capital gains on the transfer of assets will be taxed in principle. 
However, in the following cases of corporate reorganization, taxa tion will be deferred. (In cases 
where monetary consideration is provided, taxation on capital gains will be ap plied according to the 
principle.)   
Classification Requirements 
Reorganization within a corporate group 
(Equity share:  more than 50%) 1) Transfer of an independent business unit 
(Major assets and liabilities + A considerable number of its 
employees) 
2) Continuation of the transferred business * If the equity share is 100%, the requirements of 1) and 2) above are 
not necessary. 
Reorganization to form a joint venture 
- The businesses must be related to each other, and - The scale of the businesses should not be substantially 
different. 
The difference in the ratio of sales, number of employees, or 
other similar conditions should be no greater than 
approximately 1:5 
- Participation of managing directors and upper-level 
directors in management 1) Transfer of an independent business
 unit 
(Major assets and liabilities + A considerable number of its 
employees) 
2) Continuation of the transferred  business 
3) Continuation of the holding of the shares acquired in consideration 
of the assets transferred 
 
2. Taxation on Shareholders 
When only the shares in the su ccessor company or the paren t company holding the successor 
company with 100% of shares, after division, etc., are delivered to sharehol ders, taxation on capital 
gains or losses on old shares will be deferred.  
Q2. Paragraph 56 of the Report mentions th at in April 2008 Japan issued a recommendation 
against an electronic utilities FDI proposal on th e ground of "public order, public security, and 
national security."  Could Japan please provide clarif ication on what types of activities or businesses 
could be considered to be against the public or der, public security, and national security, and also 
indicate how foreign investors can access this information?    
A. Under the Foreign Exchange and Foreign Trade  Act (FEFTA), the Government of Japan has 
regulations on inward direct investment that co mply with international rules including the OECD 
Code of Liberalization of Capital Movements.  The scope of the regulations under FEFTA is clearly 
identified in the government notice. Please refer to  Table A II.3 of the Report by the Secretariat. 
 
Q3. Paragraph 59 states that Japan does not ha ve any tax measures aimed specifically at FDI 
promotion.  What are the incentives or benefits foreign investors would enjoy as a result of doing business in Japan? 
 
A. Being the second largest market in the worl d, having enormous pu rchasing power, and the 
high-quality of research and development and IT infr astructure are some incentives for foreign firms 
to invest in Japan.  Actually, in comparison w ith other Asian countries, a significant number of 
foreign firms in sales and R&D sectors are investing in Japan. 
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  Q4. Paragraph 61 refers to the Expert Committee on FDI Promotion that was established in the 
Cabinet Office in January 2008 following the abolis hment of the Japan Investment Council.  Is the 
Expert Committee Japan's investment promotion agen cy?  We are also interested in learning more 
about the Expert Committee's Five Recommendati ons Toward the Drastic Expansion of Foreign 
Direct Investment in Japan.  In addition to the medical device industry mentioned in Japan's 
second-day responses to Thailand's FDI questions, coul d Japan list other priority or target sectors 
covered by the Recommendations?  
A. The Expert Committee on FDI Promotion is an advisory body to the Minister of State for 
Economics and Fiscal Policy, so it is not an investment promotion agency.  The main functions of the 
committee are to gather informa tion about the improvement of the Japanese investing environment 
and to study policies to facilitate FDI in Japan.   (In Japan, JETRO works as an investment prom otion agency by supporting foreign firms.) 
"Five Recommendations Toward the Drastic Expansi on of Foreign Direct Investment in Japan" was 
published by the Expert Committee on FDI Promotion in May 2008 in order to promote further 
Japanese FDI.  The recommendations are composed of  5 key issues:  (1) Enhancement of the system 
toward the facilitation of M&As, (2) Comp rehensive studies on Foreign Direct Investment 
Regulations, (3) Establishment of priority strate gies by sector, (4) Reduction of business costs and 
improvement of system transparency, (5) Regional re vitalization by foreign capital, strengthening of 
the appeal that foreign capital is welcome, etc. 
 
The new priority sector that will follow the medi cal equipment sector is under consideration, and 
Japan has not decided the new sector yet.   For further information about the recomme ndations, please see the following website: 
http://www5.cao.go.jp/invest-japan/fd ip/files/en_recommendations_20080519.pdf 
 
Q5. Paragraph 46 mentions Japan's current stat e-trading activities, which include rice and other 
products.    We would appreciate it if Japan could explain the principle, methodology and results of state-trading 
activities relating to these products, particularly rice, for the past 3 years. 
 Which mechanism does Japan utilize to set and stab ilize prices of imported products, especially rice? 
 Does Japan notify the state trading activities and pr ice-stabilizing mechanisms mentioned above to the 
WTO?  If so, please provide references.   
 
A. 
a) Please refer to Japan's current notification (G/STR/N/11/JPN). b) The sale prices of imported rice are decided by competitive tender. c) Please refer to the latest notification G/STR/N/ 12 /JPN. 
 
Q6. As noted in paragraph 85 of the Report, Jap an has extended the Design Act's maximum term 
of protection from 15 years to 20 years from the date of registration.  Could Japan please provide the main reasons for this extension?  Furthermore, because the extension provides more exclusive rights 
for the right holders, how does Japan prevent risk of monopoly?  
 
A. Attractive designs may be a source of added valu e for long term. In fact, as of the end of 
2004, almost 16% of registered design right still exist on the 15th year from the date of registration.  Therefore, it was concluded that the duration of pr otection of design right should be extended to more 
than 15 years from the date of registration.   WT/TPR/M/211/Add.1 
 Page 333 
 
 
  On the other hand, in the case that the duration of protection would be extended to more than 
20 years, the extended duration stipulated by the amended Act would be quite different from the 
duration stipulated by the previous Act, thus c ausing an imbalance between  applicants who can enjoy 
only the previous duration and those who can enjo y the extended duration.  For these reasons, we 
considered it appropriate to extend the duration from  "15 years from the date of registration" to 
"20 years from the date of registration".   
 Concerning the question about monopoly, in the field of invention, technical advancement per 
development of technologies might be harmed by too long term protection of exclusivity.  A design is, 
however, protected in the aesthetic aspect; theref ore we think that harmful effects through the 
extension of term are relatively small.    
Q7. Paragraph 85 also mentions that Japan has eased the time limit for multiple patent applications to up to 30 days.  Does this time lim it apply to applications from outside of Japan?  If 
not, please provide information on the time limits  for applications from outside of Japan.  
 
A. Yes, it does.  "An applicant" in Article 44( 1) of the Patent Act does not exclude "an overseas 
resident."  Article 44 (Division of patent applications) 
1 An applicant for a patent may extract one or more new patent applications out of a patent 
application containing two or more inventions only within the following time limits: 
 (i) within the allowable time limit for amendmen ts of the description, scope of claims or 
drawings attached to the application; 
 (ii) within 30 days from the date on which a certified copy of the examiner's decision to 
the effect that a patent is to be granted (excluding the examiner's decision to the effect 
that a patent is to be granted under Article 51 as applied mutatis mutandis under 
Article 163 (3) and the examiner's decision to the effect that a patent is to be granted with regard to a patent application that has been subject to examination as provided in Article 160 (1)) has been served;  and  
 (iii) within 30 days from the date on which a certified copy of the examiner's initial 
decision to the effect that the applicat ion is to be refused has been served. 
 
Q8. Paragraph 90 of the Report discusses the Act on the Prevention of Unauthorized Recording of 
Movies in Theatres which was adopted in May 2007.  We would appreciate it if Japan could provide information about this measure's impact on allevi ating the problem of illegal recording in movie 
theatres, e.g., statistics on arrests as well as freque ncy of unauthorized recordi ngs, before and after the 
measure was introduced.  We would also appreciat e it if Japan could provide details on any other 
administrative measures it has enacted to preven t the illegal recording of movies in theatres. 
 
A. Because of the preventive measures taken by the related parties and the deterrent effect 
caused by the enforcement of the Act, the film i ndustry has reported that the extent of unauthorized 
recording of movies seems to ha ve decreased since the "Act on th e Prevention of Unauthorized 
recording of Movies in Theatres." 
 There have not been any arrests for violating the Act since its introduction. 
 
Q9. Paragraph 6 states that Japan introduced ne w direct payment assistance to "core farmers" on 
1 April 2007, and that certified farmers may recei ve income support based on "historical reference 
amounts."  a) Could Japan please provide more details on the operation of this type of payment assistance?  
We are particularly interested in learning how it operates for rice.   WT/TPR/M/211/Add.1 
Page 334  
 
  Does Japan notify this payment to the WTO?  If so, please provide referenc es. Under which category 
of domestic support does this payment fall?  Could Japan provide examples of how "histo rical reference amount s" are calculated? 
 A.  a) A. Japan is planning to notify the details of this measure to the Secretariat in due course. 
Please refer to that notification. 
b) A Japan is now examining how to classify this  new direct payment measure.  The Committee 
on Agriculture will be notified of the final classification decision. 
 
c) A. Japan is planning to notify the detail of th is measure to the Secretariat in due course. 
Please refer to that notification. 
 
Q10. Paragraph 20 discusses Japan's shift away from price support schemes to direct payment 
schemes for wheat, sweet potatoes, white pot atoes, sugar beets and sugar cane.  
 Please provide more details about these new paymen t schemes and how they are implemented.  We 
would also appreciate more information on the difference between price support and direct payment.    Does Japan notify these schemes to the WTO? If so, please provide references.  Under which category 
of domestic support do these schemes fall? 
 Will the transformation of price support to direct  payment schemes affect domestic prices and the 
importation of sugar and flour into Japan?  How so?  A.  a) As for wheat, white potato for starch u se and sugar beets, the new direct payment scheme 
referred to in the Secretariat's Repor t (paragraph 6) has been introduced. 
 In April 2007, the price supporting systems for sugar  cane and sweet potato for starch use were also 
abolished and switched to new direct payment syst ems which are different from the one mentioned 
above.  
 These schemes target core farme rs and are different from former price support measures which do 
not limit recipient producers.    
b) Japan is now examining how to classify these direct payment schemes.  The Committee on 
Agriculture will be notified of the final classification decision.  c) As domestic prices and importatio n of sugar and flour into Japan are affected by fluctuation 
of domestic and global market, quantitative anal ysis cannot be undertaken on the effects of 
introduction of the said direct payment scheme. 
 
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