EU-Japan Business Round Table“EU-Japan Business Cooperation: Growth for the Future”
Recommendations
Rome, 28 & 29 April 2011

Summary / Key Points•

On the occasion of its annual meeting in Rome on 28 and 29 April 2011, the EUJapan Business Round Table (BRT), a forum of some 50 CEOs and senior
executives from leading European and Japanese firms, expressed the views of
the business community regarding the future of EU-Japan economic relations,and agreed on policy recommendations to the European Commission and theJapanese Government.

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The combined EU-Japan economy accounts for 35% of global GDP and for
22.4% of global trade, and the EU and Japan increasingly share similarinterests and face common challenges. Nevertheless, bilateral economic andtrade flows are stagnating; as in previous years, BRT Members point to theenormous untapped growth potential in EU-Japan trade and economic
relations.

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In this context, the BRT renews its call from last year on the Authorities to:‐ strengthen significantly EU-Japan cooperation in the common priority
areas identified to drive future growth, while addressing global
challenges;‐ start negotiations on a balanced and mutually beneficial bilateralagreement, as soon as the EU and Japanese Authorities agree that theright conditions are met, in order to promote an ambitious developmentof trade and investment between the EU and Japan.

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During the past year, important and cooperative political efforts have been
made between the EU and Japanese Authorities, including the work of theHigh-Level Group. The BRT regards these efforts as elements of progress andas steps in the right direction.

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Reciprocity and mutual trust are keys to the success of any further cooperationand market opening between the EU and Japan. BRT Members call for stronger
top-level political commitment and leadership on both sides to make the bestuse of the current momentum at the next annual EU-Japan Summit.

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1. Introduction
The EU-Japan Business Round Table (BRT) held its annual meeting in Rome on
28 and 29 April 2011. The meeting was co-chaired by Dr. Jean-Yves Le Gall,
Chairman and CEO of Arianespace, and Mr. Hiromasa Yonekura, Chairman of
Sumitomo Chemical Co., Ltd.
The BRT had the pleasure and honour of welcoming high-level representatives of
the European and Japanese Authorities, Mr. Antonio Tajani, Vice-President of theEuropean Commission, Mr. Chiaki Takahashi, State Secretary for Foreign Affairs,and Mr. Hideichi Okada, the METI Vice-Minister for International Affairs.
The BRT Meeting took place at an exceptional time, only a short period after theearthquake that struck Japan on 11 March and the tragedy that followed. BRT
Members wish to extend their deepest condolences to the victims of this tragedy.
They are dedicated to supporting the Japanese Government in its relentlessefforts to contain the crisis and are confident that under its leadership, and withthe full support and solidarity of the international community, Japan will soon
recover from this hardship.
The 2011 BRT Annual Meeting programme can be summarised as follows:‐‐‐‐

Discussion and adoption of general and sectoral recommendations.
Special discussion on cooperation between EU and Japan industries.
Discussions with EU and Japanese Authorities on: 1/ Sectoral
recommendations, 2/ The potential and conditions for strengthening EU-Japan
cooperation 3/ The future framework for EU-Japan relations.
Informal discussions between Members on subjects of special interest to
business on both sides.

The BRT agreed to hand over this set of recommendations to President Herman
Van Rompuy, President José Manuel Barroso and Prime Minister Naoto Kan, on
the occasion of this year’s EU-Japan Summit.

2. Overall Priorities
Although the global economy is growing again, business leaders from the EU andJapan are still extremely concerned by the persistent and often aggravating
imbalances threatening recovery. Sovereign risks related to high debt levels bothin the EU and Japan are a key issue that requires strong and ambitious budgetaryand fiscal consolidation policies from Governments. Sharp currency fluctuations
increasingly affect trade flows. Global issues continue to prevail such asenvironmental and energy concerns, food shortages and rising commodity prices,increasing worldwide social tensions related to rising inequalities within growth
patterns, and unemployment. Emerging economies are playing an everincreasing role, nurturing global growth but increasing the pressure on natural
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resources, challenging the competitiveness of the European and Japanese
economies, but also offering huge trade and investment opportunities.
As in previous years, all BRT Members again point to the enormous untapped
growth potential in EU-Japan trade. The combined EU-Japan economy accounts
for 35% of global GDP and for 22.4% of global trade. The BRT urges both sides’
Authorities to strengthen the EU-Japan relationship. In the current global context,
where the EU and Japan face increasingly similar challenges to overcome
together, this call is more relevant than ever.
Members accordingly call on the Authorities to strengthen their cooperation
framework and they believe that many opportunities lie ahead for developing
fruitful cooperation between EU and Japanese businesses. BRT Members
welcome the parallel release in 2010 of “growth through trade” strategies in the
EU (the “Europe 2020” strategy and its related flagship initiatives) and in Japan(the “New Growth Strategy” and the “Japan Comprehensive Economic
Partnership Policy”) and note approvingly that in both documents the EU andJapan recognise one another as vitally important investment and trade partners.
BRT Members wish to highlight the similarities in the priority sectors identified tosupport future economic growth, notably “green technologies” in the areas ofenergy and environment, network infrastructure related to transport, water andenergy, new health and social needs related to the ageing of populations, and“frontier industries” such as aerospace. They also note the focus both sides’
Authorities attach to support for innovation, information and communication andnext-generation technologies, and to regulatory convergence and the international
harmonisation of technical standards, as ways of improving long-term industrial
competitiveness. The BRT calls on the Authorities to build on these shared visionand similarities to foster mutual trade and cooperation between the EU andJapan, while addressing global challenges.
Secondly, the BRT reaffirms the importance of opening further markets,
enhancing investment and encouraging, through a renewed and adequate
framework, the development of mutual trade, based on fair and transparent
competition, between the EU and Japan.
In the past year, several developments have taken place between the EU andJapan Authorities.
At the 2010 EU-Japan Summit, in line with previous BRT recommendations,leaders from both the EU and Japan stressed that the EU and Japan, as likeminded global partners and major economies, should systematically aim to work
more closely together, both bilaterally and globally. They decided to establish aHigh-Level Group to conduct a joint examination of the ways to comprehensively
strengthen and integrate the EU-Japan economic relationship, addressing allissues of interest to both sides including, for instance, all tariffs, non-tariffmeasures, services, investment, intellectual property rights and government
procurement. The BRT notes that both sides agreed on the conclusion of “a few
specific non-tariff issues” under paragraph 34 of the Joint Press Statement of the2009 EU-Japan Summit. The BRT urges the Authorities to ensure an effective
implementation of the agreed texts.
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Recently, other developments have taken place. On 24 and 25 March, 2011, theEuropean Council concluded that the forthcoming summit must be used tostrengthen the relationship and bring forward our common agenda, including
through the potential launch of negotiations for a free trade agreement on thebasis that Japan is willing to tackle, inter alia, the issues of non-tariff barriers andrestrictions on public procurement. The Government of Japan has committed to
opening up Japan and to addressing any non-tariff measures within the context offree trade agreement negotiations, as stated in the Cabinet decision of "the Basic
Policy on Comprehensive Economic Partnerships" (November 2010).
Japanese business is very much encouraged by these developments andbelieves that now is the time for the EU and Japan to launch negotiations for an
EU-Japan Economic Integration Agreement.
In this context, the BRT renews its call from last year on Authorities to startnegotiations on a balanced and mutually beneficial bilateral agreement, as soon
as the EU and Japanese Authorities agree that the right conditions are met, inorder to promote an ambitious development of trade and investment between the
EU and Japan.
Considering the above, the BRT regards the efforts made between both sides’
Authorities during the past year as elements of progress and as steps in the right
direction.
BRT members believe that fairness and reciprocity are keys to the success ofthese endeavours, as well as mutual trust in the effective implementation of newrules. There must be a balance in concessions made by both parties in the
opening of markets in the EU and Japan for Japanese and EU companies
respectively. The BRT therefore calls for stronger top-level political commitment
and leadership on both sides to make the best use of the current momentum at
the forthcoming EU-Japan Annual Summit.

3. Immediate Action Items – Request to the EU and Japanese Authorities•

Working Party A: Trade, Investment and Regulatory Cooperation‐

Strengthen the EU-Japan Economic Relationship.
o Start negotiations on a balanced and mutually beneficial bilateralagreement, as soon as the EU and Japanese Authorities agree that theright conditions are met, in order to promote an ambitious expansion of
trade and investment between the EU and Japan.
Support the WTO Doha Development Agenda.
o Prevent the closing of world markets and cooperate to achieve a rapid
and ambitious conclusion of the Doha Round.
Apply international standards and enhance co-operation in the promotion of
new global standards.

‐‐

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‐‐‐Support the timely development of business.
Cooperate in the area of climate change and environment.
Aim for better regulation.

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Working Party B: Life Sciences and Biotechnologies, Healthcare andWell-being‐

General: Continue to formulate concrete action plans for Japan’s “New Growth
Strategies” in Life Science & Biotechnology, thereby focus on the
improvement of efficient healthcare practices, food security / supply andinnovations in Biotechnology.
Health-Care: Finalise the implementation of a new innovation-rewarding
pricing system for drugs and pharmaceutical products in Japan, including theabolishment of special price cut at first generic launch, and the abolishment of
the rule of re-pricing by market expansion.
Health-Care: Improve the pharmaceutical and medical device businessenvironments by proceeding with regulatory harmonisation and a further
extension of the “Mutual Recognition Agreement” in order to avoid redundantinspections of manufacturing facilities (e.g. injectable pharmaceuticals andAPIs) and establishing more competitive pricing systems to promote
innovations.
Plant Protection & Biotechnology: Fulfill people’s acceptance of GMOs by
educating people about the efficiency and safety of GMOs based on scientificknowledge, considering world food supply and demand prospects incooperation with private sectors.
Plant Protection & Biotechnology: Implement concrete action plans for ahigher food self-sufficiency of Japan. Shorten the review times for new
applications / product registrations in both plant protection and biotechnology.
Animal Health: Introduce a 1-1-1 concept (one dossier – one assessment –one decision on marketing authorisation) for all animal health products, further
harmonise the regulatory requirements for product registration, shorten review
times and recognise the GMP certification for veterinary products.
Industrial Biotechnology: Enhance the cooperation between the EU and Japanin order to stimulate the market introduction of bio-based products.

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Working Party
Technologies

C:

Innovation,

Information&

Communication

Information & Communication Technologies:‐‐‐

Implement detailed action plans with specific targets and use PDCA cycles tomonitor the status of each item under ICT strategy.
Provide the necessary stimuli to industry to encourage the provision of highspeed fixed or mobile broadband services in the areas where deployment byprivate sector investment is difficult.
Prioritise budget allocation for innovative ICT projects in areas such as
healthcare, education, central and local government.
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‐

The Round Table recommends the harmonisation of regulations for cloudcomputing usage in the EU and Japan, application of reduced VAT to eBooks,
reviewing the copyright Levy system and the maintenance and joint review of
the WTO’s Information Technology Agreement (ITA).

Innovation (General):
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Support flagship projects and innovative solutions to common societal
challenges through deregulation and inviting investment and expertise fromEU and Japanese industry.
Allocate strategic budgets for innovation investment particularly on educationin science, technology, engineering and mathematics fields, and on
developing competent human resources in Science & Technology, R&D and
test-bed projects.
Periodically review rules and regulations.
Continue investment on R&D Infrastructures in national laboratories anduniversities.
Strengthen business cooperation between EU and Japanese clusters.

Innovation in aeronautics, space and defence:
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Significantly upgrade the scale and funding of EU-Japan industrial cooperationin civil and defence aeronautics and space.
Establish broad bilateral cooperation on environmental issues in aeronautics,
from noise to emission, at all aircraft speed.
Aircraft certification authorities should establish cooperation.
In civil satellite technology, space authorities should establish a mechanism
for a formal and permanent dialogue towards cooperation.
Japan and the EU Member States should establish a regular dialogue aimed
at sharing experience on defence purpose satellites.
Authorities should establish a mutual backup scheme for all government
launches using their respective satellite launcher fleets.
Japan and the EU Member States should make official agreements forgovernment and industry to exchange and protect classified data pertaining tojoint development.
Japan should relax the three principles on arms exports to allow Japan to joinin R&D and production of defence equipment with NATO countries.
Japanese Authorities should make it easier to import and re-export defence
equipment for the purpose of trade fairs and other demonstrations.

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Working Party D: Financial Services, Accounting and Tax Issues‐

While we agree that financial reforms based on the G20 summit common
principles need to proceed, we wish to point out that a careful balance
between innovativeness, risk appetite and regulation must be struck, and thatthe characteristics of each country and region should be fully considered.
We support the trends towards accounting standard convergence and theenhancement of standard setter’s governance. We wish to point out that the‐

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Changes in accounting standards have impact on corporate activities and thus
on the economy.
Removal of double taxation is still an important issue and it is important toensure an arena for wide-ranging dialogues between the tax authorities. We
also believe that the transparent and fair taxation are extremely important for
global companies, and thus hope that transparent and fair tax reform and its
execution are continued.
Working Party E: Environment and Sustainable Development

Natural Disasters and Safety Measures:‐

The earthquake and the tsunami which struck Tohoku, and the Fukushima
nuclear power plant situation demonstrate the need for independent
assessment of risks and consequences as well as the need of a more flexible
approach to allow a swift acceptance of support from overseas.

Alternative and Renewable Energies:‐‐

The drivers (climate change, energy independence) for using alternative andrenewable energies, including nuclear, will remain. The development ofrechargeable batteries and its multiple applications, from EV to smart cities
and smart grids is a particular area where Japan and EU should provide
support and seek harmonization of infrastructure and regulation.
In the wake of the Fukushima accident, the rising expectations for nuclear
energy call for a strengthened nuclear safety framework. The EU and Japan
should cooperate on promoting “world safety standard” and capacity building,and encourage skilled and independent safety authorities.

Securing Supplies of Rare Metal Resources and other Raw Material:‐

The EU and Japan should promote actions in international fora to establish aset of rules on access to raw material, as a way to manage in a fair way thepressure on price and availability of these resources stemming from a growing
demand and in some cases on limitation of supply.

Global warming issues:‐

It is urgent to reduce greenhouse gas emission. It is therefore necessary that
the EU and Japan engage all large emitting countries in a new, fair andeffective international framework. At the same time, the EU and Japan shallencourage the widespread use of existing energy efficient and low carbon
products and technologies, support an effective technology transfer process
and cooperate in developing innovative solutions.

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