Recommendationsof theEU-Japan Business Round Table
to the Leaders of the European Union and JapanTokyo, 15 November 2022
Working Party 1
Trade Relations; Investment and Regulatory Cooperation; Financial
Services, Accounting and Taxation

Working Party Leaders:

Co-ChairMr. Michael MROCZEK
President
European Business Council (EBC)in Japan

Co-ChairMr. Kuninori KUROISHI
Senior Advisor
Marubeni Corporation

Vice Co-Chair
Mr. Markus BEYRER
Director General
BUSINESS EUROPE

Vice Co-Chair
Mr. Shinji FUKUKAWA
Senior Advisor
Global Industrial and Social
Progress Research InstituteWorking Party 1: Trade Relations; Investment and Regulatory Cooperation; Financial Services, Accounting and Taxation
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List of Abbreviations
Abbreviation
AEOs
APA
ATP
BEPS
BPR
CAA
CbCR
CCCTB
CE
CLP
CMR
CoRAP
DDA
ECHA
EIOPA
EN
EP
EPA
EU
FDI
FSA
FTA
FTT
G8
G20
GATS
GDP
GHS
GoJ
GPA
GPS
HSE
ICTs
IEC
IPM
ISO
JAS
JELMA
JET
JETRO
JIS

Meaning
Authorised Economic Operators
Advance Pricing Agreement
Adaptation to Technical ProgressBase erosion and profit shifting
Biocidal Products Regulation
Consumer Affairs Agency
Country by Country reporting
Common Consolidated Corporate Tax Base
Conformité Européenne (European Conformity)
Classification, labelling and packaging
Carcinogenic mutagenic or reprotoxic
Community Rolling Action Plan
Doha Development Agenda
European Chemical Agency
European Insurance and Occupational Pensions
Authority
Européen de Normalisation de Normalisation(European Standards)
European Parliament
Economic Partnership Agreement
European Union
Foreign Direct Investment
Financial Services Agency
Free Trade Agreement
Financial Transaction Tax
Group of EightGroup of Twenty
General Agreement of Trade in Services
Gross Domestic Product
Globally Harmonized System of Classification andLabelling of Chemicals
Government of Japan
Agreement on Government Procurement
Gross Product Strategy
Health Safety and Environment
Intra-Corporate Transferees
International Electrotechnical Commission
Interface Public Members
International Organisation for Standardisation
Japan Agricultural Standard
Japan Electric Lamp Manufacturers Association
Japan Electrical Safety & Environment Technology
Laboratories
Japan External Trade Organisation
Japan Industrial Standard

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JR
KPIs
LED
LoA
MAFF
METI
NTM
NOL
OECD
OR
PPPR
PSE
R&D
REACH
RoHS
SDS
SIEF
SMEs
SVHC
UNECE
VAT
WCO
WHO
WTO
WP

Japan Railways
Key Performance Indicators
Light-Emitting Diode
Letter of Access
Ministry of Agriculture, Forestry and Fisheries
Ministry of Economy, Trade and Industry
Non TariffMeasure
Net Operating Loss
Organisation for Economic Co-operation andDevelopment
Only Representative
Plant Protection Products Regulation
Electrical Appliance and Material Safety Law
Research & Development
Registration, Evaluation, Authorization and Restrictionof Chemicals
Restriction of Hazardous Substances
Safety Data Sheet
Substance Information Exchange Forum
Small and Medium size Enterprises
Substance of Very High Concern
United Nations European Commission for Europe
Value Added Tax
World Customs Organisation
World Health Organization
World Trade Organization
Working Party

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Introduction
The EU-Japan partnership is based on longstanding cooperation which has beenstrengthened with the recent geopolitical tensions, including the war in Ukraine. As
close likeminded partners that share values and principles, the EU and Japan havestrong trade and investment ties. This year marks three years since the EU-Japan
Economic Partnership Agreement (EPA) entered into force. Over this period, it has
proven to be the bedrock of the EU-Japan economic relationship and in 2021, trade ingoods between the two recovered to pre-pandemic levels reaching 125 billion euros.
Working Party 1 stresses that despite the overall smooth implementation of the EPA,
agreement must also address the specific concerns of European and Japanesebusinesses reflected in this and previous reports. With so much at stake, we urge theauthorities on both sides to swiftly ensure that the necessary progress is made. Many
reforms are required to secure a fair and competitive environment for business. They
have been identified based on the extensive first-hand operational experience ofWorking Party 1 members in the Japanese and European markets. This report sets out
concrete recommendations addressing the following key issues:•

Creation of a common regulatory environment, mutual recognition of regulations,standards and market authorisations to the extent possible, adoption ofinternational standards and enhancing regulatory cooperation•

Initiate discussions on how to facilitate the movement of people under pandemics•

Further deepen and support initiatives leading to more collaboration on third
markets•

Ensuring fair competition and equal treatment of all companies, domestic andforeign – for both goods and services•

Improving conditions for foreign direct investment
and finally,•

Pursuing simpler, lighter and sensible tax systems, including theimplementation of the BEPS Actions without additional administrative burden

To highlight priority issues in the text that follows, one asterisk (*) indicates “priority”
recommendations. (e.g. WP 1/ # 01* / EJ to EJ)

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Recommendations from both
European and Japanese industries
WP-1 / # 01* / EJ to EJ
Post-EPA

Strengthening the EU-Japan Economic Relationship

The BRT praises both the European Commission, and the Member States, and theJapanese Government for the successful enforcement of the EU-Japan EPA. In
parallel, the BRT would like to emphasise that the parties should be more ambitious inorder to get the most out of the agreement and also to build on the agreement in orderto profit further from synergies. The effective application of the EPA would prove evenmore important in ensuring the steadfast economic recovery of both sides following the
COVID-19 crisis, as well as progress in developing sustainable connectivity, andquality infrastructure. It is also important for the EU and Japan as like-minded countries
to strengthen our complementarity and competitiveness through the EPA so that
disruptions in supply chains that have become apparent due to the COVID-19 andclimate change crisis can be addressed. Hence the BRT recommends the following:

Enhancing Regulatory Cooperation
The BRT calls on the EU and Japanese Authorities to:
•

•

•
•
•

Continue to strive further for free trade between the EU and Japan without
obstacles by pursuing regulatory cooperation, harmonisation and mutual
recognition of international regulations and testing procedures. It is important that
this is done swiftly as to not lose the momentum that was built up during thenegotiations.
In the same vein, ensure that the EPA is continuously updated and that new
aspects are added as they become necessary. For instance, new technologies,
public health issues, cross-border flows of data, prohibition of data localization
requirement, and non-discriminatory treatment of digital products, etc.
Immediately consult with industry in order to set up working groups in sectors thatwould benefit from closer regulatory cooperation
Regularly consult companies of all sizes to ensure the best implementation ofregulatory cooperation.
Ensure that the recently launched “Japan-EU Digital Partnership” advances
cooperation on digital issues to foster economic growth and a human-centric digitaltransformation based on common values. The Japan-EU Digital Partnership must
be a flexible cooperation instrument that goes beyond dialogue and exchange of
information between Japan and the EU with the view to deliver concretedeliverables. To this end, the Japan-EU Digital Partnership should notably shapedigital trade principles and promote regulatory cooperation on key technology
enablers for digital trade.

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The BRT believes that:•••

For regulatory cooperation to be successful, negotiators on both sides must be
given the appropriate mandate so that the results of the talks can be properly
implemented and enforced. There is a need for a follow-up to ensure this.
Through regulatory cooperation new technologies can be shared and introducedon both markets with a minimum of delay. This in turn leads to more benefits forindustry and consumers, hence to society as a whole. The Japan-EU DigitalPartnership is an opportunity not to be missed.
Global solidarity, cooperation and effective multilateralism are more in need thanever, to come through the pandemic as well as to ensure economic recovery. It istherefore extremely important to develop the EU-Japan relationship even more,
and in doing so to demonstrate to others that such cooperative relationships are
possible.

Encouraging the use of EU-Japan EPA, particularly by SMEs
The BRT calls on the EU and Japanese Authorities to:••

Ensure that not only large corporations but also SMEs can make best use of theagreement.
Proactively inform industry of the advantages of utilising the EPA. Call for theediting of practical guides for businesses that want to export or invest in the EU
and Japan, to inform on rules to be implemented (tariffs, rules of origin, services
regulations, single entry points, contact of licensing bodies, mobility of personnel
requirements, etc.).

The BRT believes that:•

SMEs are an important and integral part of both the EU and Japanese economies.
At the same time, they tend to face bigger difficulties in utilising a complex system
due to lack of resources and sometimes even knowledge. Getting them on board
is essential to ensure that trade between the EU and Japan reaches its full potential.

Joint investment in 3rd countries
The BRT calls on the EU and Japanese Authorities to:••••Continue to support EU and Japanese industry to invest jointly in 3rd countries,
notably in the regions of the Western Balkans, Eastern Europe, including Ukraine,
Central Asia, Indo-Pacific, as well as in Africa.
Hold discussions on joint investment not only at high level, but focusing on practicaland operational aspects, and companies on both sides should be able to takeadvantage of the resulting outcomes and implement them easily.
Make good use of the EU-Japan Partnership on Sustainable Connectivity andQuality Infrastructure to find synergies in investments and infrastructure projects.
To better coordinate and ensure that ODA projects are not favouring suppliers fromeither region.

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The BRT believes that:••••

This support is particularly important in developing countries where investment canhelp the country in question to raise its standard of living significantly.
It is furthermore important that the EU and Japan continue to play a leading roleon the global stage to ensure enhanced competitiveness.
The strengths on both sides should be more efficiently utilised and that where it ispossible to cooperate, this should be commenced earlier in the process.
The challenges of the current and future pandemics cannot be solved by the EU
and Japan exclusively within their own countries. Therefore, it is important to step
up EU and Japanese assistance to partner countries facing the impact of thepandemic, not only by providing short-term assistance but also by supporting themover the mid- to long-term.

Minimising the impact of Brexit
The BRT calls on the EU to:•••Continue dialogue with UK in order to minimise any potential risks, and takenecessary steps to avoid the suspension or termination of the EU-UK Trade
Cooperation Agreement (TCA).
Maintain/restore a favourable business environment for investment and services,
including financial transactions, harmonised regulations and standards, andaccess to workforces with necessary skills.
Listen to calls from across the industries to ensure that any new arrangements will
be implemented in a manner that does not cause disruption, and take necessary
measures as much as possible.

The BRT believes that:••

Brexit is impacting not only the EU, the UK and Japan separately but also the EUJapan relationship.
Free and fair trade between the EU, Japan and the UK will not only help businessactivities but also have a positive effect on the wider area of cooperation andmutual interests including the welfare of consumers and society as a whole, while
upholding the rules-based international order, the rule of law and promotion of
democracy.

Promoting the Free Flow of Data
The BRT calls on the EU and Japanese Authorities to:•

Pursue the recently launched negotiations to review and complete the digital trade
chapter of the EPA to the highest standards, including language on cross-borderdata flows, as set in Article 8.81 of the EPA (three-year review clause).

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The BRT believes that:• The data plays a key role in promoting and accelerating the digital economy. The
free flow of data under the secured conditions, namely Data Free Flow with Trust
between the EU and Japan will mutually be beneficial for creating business
opportunities and strengthening the competitiveness in both economies.

WP-1 / # 02* / EJ to EJ Recommendations for an ambitious multilateral tradeagenda toward the next WTO Ministerial Conference
Under the mounting pressure of protectionism in a post-COVID world, and the on-goinggeopolitical crisis causing the wide-spread disruption of international order, the EU andJapan should support strengthening and reforming the WTO. Together with other WTO
members, the EU and Japan should work to ensure the centrality of the WTO as theguardian of the multilateral trading system, and the value of WTO agreements as abasis of fair rules to maintain order in global trade, to assure the mobility of people,
capital, goods and services so that we could revitalize the economic activities of thewhole world, and promote further liberalization. It is necessary, therefore, that the
WTO and its members are to ensure the relevancy of multilateral trading system andto further promote the reforms to improve the responsiveness to present and futurechallenges, while taking into account the concerns expressed against trade andglobalisation.
In this view, BRT welcomes the adoption of the Ministerial Declaration at the Twelfth
WTO Ministerial Conference held in Geneva and concluded on June 17th, 2022.
The BRT calls on the EU and Japan to:
•

•
•
•

•

Renew the moratorium on customs duties on electronic transmissions of the WTO
by the next WTO Ministerial and find agreement to make it permanent, noting thatthe custom duty-free distribution of electronic transmissions is at the core oftechnological innovation and the digital economy. The WTO must not be the venue
that would allow the principle of raising customs tariffs on trade in services.
Avoid continuing to waive the protection of intellectual property rights regarding
COVID-19 related therapeutics and diagnostics.
Reinforce the negotiating pillar of the WTO to better disseminate the benefits ofglobal value chains. The EU and Japan must play a central role in this regard.
Safeguard the proper functioning of the enforcement pillar of the WTO, its Appellate
Body in particular. In this term, the BRT welcomes, and emphasizes the importanceof, attempts made by the 12th WTO Ministerial Conference in recognizing thesignificance and urgency of responding to the challenges and concerns expressedagainst WTO’s dispute settlement system, including the WTO Appellate Body,
while proclaiming their commitment to build a dispute settlement system accessible
to every member with perfect and superb functions, by 2024.
Reaffirm the importance of a market-oriented trade environment. Regarding the
WTO reform, supporting the continuation of trilateral cooperation among the US,
the EU, and Japan, especially efforts to strengthen WTO rules on industrial
subsidies and technology transfer, and to improve compliance with notification
obligations, as well as ensuring that all WTO members contribute according to their

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•

•
•

•

real economic power. The BRT also supports the development of rules on traderelated aspects of electronic commerce.
Explore further topics that are essential for the smooth functioning of global value
chains together with other WTO members. These could include, for example,
industrial subsidies, the reduction of export restrictions, investment (facilitation) andcompetition. Also, the EU and Japan need to take the lead in building an export
compliance framework that creates a level playing field and alleviates businessuncertainty.
Revitalise negotiations under the Joint Statement Initiatives, especially in the digitalarea and in climate and the environment.
Implement in full the Disciplines that have been agreed on 2 nd December 2021 in
Geneva on Domestic Regulation in Services in all relevant domestic regulation in
the EU and in Japan to further improve transparency and ease of doing services
trade and investment. Encourage the full implementation of the Reference Paper
by all signatories, for instance by putting into place a notification system to the WTO
Secretariat. Encourage other WTO countries to join the initiative already signed by
68 countries. This is an agreement that shall benefit all WTO Members.
Lead the discussion of further expanding the product coverage and membershipcountries and regions for the Information Technology Agreement (ITA), as agreed
in December 2015, given the current global circumstances such as COVID-19
pandemic and the on-going geopolitical crisis disrupting the supply chains. The ITA
plays a significant role in maintaining and continuing negotiations on a plurilateralbasis, given the difficulty of reaching an agreement among all WTO Members

The BRT believes that:•••

The 12th WTO Ministerial Conference was crucial in reaffirming the benefits of arules-based multilateral trading system, and successfully delivered a package ofmultilateral and plurilateral outcomes that could equip governments and business
operators with modern and effective trade rules. At the same time, the upcoming
Ministerial Conference needs to further promote the discussion on the reform of the
WTO with the view to continue delivering concrete results for the future.
For the e-commerce, the upcoming Ministerial Conference should seek to makereal progress towards an ambitious, comprehensive and commercially meaningful
outcome, including rules to ensure cross-border flow of data. The e-commerce
Agreement should prohibit data localization measures and requirements fordisclosure of source codes, algorithms, and proprietary information relating tocryptography ensuring the non-discriminatory treatment of digital products.
Incorporating the value chain perspective when negotiating the liberalisation of
goods and services under the auspices of the WTO is critical. This will effectively
ensure a real impact, as global value chains play an increasingly important role ininternational trade. Liberalisation should also include environmental goods related
to the Environmental Goods Agreement (EGA), so long as it does not discriminate
unfairly between products and sectors and to expand these talks to environmental
services, that are crucial to fight pollution and climate change. Moreover, in thefollow up to the COVID-19 pandemic, the WTO should look into trade and healthinitiatives that will make the world more resilient in future crises.
The decision to waive the protection of intellectual property rights regarding COVID19 vaccines, fails to address the current challenges of access to vaccines and risks
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undermining efforts to address future pandemics as companies will have lessincentives to invest in R&I.
From these perspectives, BRT welcomes, and points out the importance of, the 12th
Ministerial Conference agreeing to renew the discussion of the work program for ecommerce, and to make permanent the WTO moratorium on customs duties ofelectronic transmissions.

WP-1 / # 03* / EJ to EJ Applying
regulatory cooperationinternational

standards

andenhancing

The BRT believes that regulatory cooperation is key to the economic prosperity of thetwo economies. Following the successful entry into force of the EU-Japan EPA in
February 2019, it is now even more important than ever to ensure not only that new
regulations do not nullify or impair the market access benefits which have beenachieved under the agreement nor create new barriers to bilateral trade, but also tofurther expand and strengthen the regulatory cooperation between the two economies.
This way the EU and Japan will be able to create a more favourable businessenvironment and hopefully also expand such cooperation to other bilateral andmultilateral relations.

General recommendations
The BRT calls on the EU and the Japanese authorities to:
•

•
•
•

Building on the EPA, jointly pursue the harmonisation of rules, regulations andstandards. While the EPA has certainly provided great success in this regard, theBRT believes that the work has to continue in order to deal with areas not coveredby the EPA as well as new areas and technologies.
Where international standards have not yet been developed, to accept the approvalof the import, sale or use of products that have been approved on the basis offunctionally equivalent requirements if it is possible and appropriate to do so.
Study the possible impact of new regulatory developments on domestic and foreignbusiness to avoid taking initiatives that might create barriers to trade andinvestment.
To establish a close dialogue with industry regarding the harmonisation ofregulations and standards by discussing concrete use cases and examples frombusiness experience.

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The BRT believes that:
•
•
•

1.

The EPA creates a perfect platform for regulatory cooperation it is vital that this isdone without delay as to not lose momentum.
A similar mind-set as was shown during the negotiations is now needed in order toachieve regulatory harmonisation which is capable of being enforced.
Continued dialogue is necessary, but with goals clearly defined so as to avoid a
dialogue without results.
Create a common chemicals regulation
The BRT calls on EU and Japanese Authorities to:••

Establish a common list of the hazard information of substances and acommon approach to the evaluation and sharing of data, and the hazard
classification.
As a first step towards complete recognition set up a system where test
results carried out in either the EU or Japan to be recognised as carried out
in the other region.

The BRT believes that:•2.

A common regulatory environment will not only benefit the industries
through cost mitigation but also benefit users and consumers through lower
prices and consistent protection.

Create a common resource efficiency policy
The BRT calls on the EU and Japanese Authorities to:••

Promote the concept of resource and energy efficiency, using the rightincentives, standardised test methodologies, criteria and a common format
of environmental products declaration between the EU and Japan andcooperate with each other so that such policies are internationally shared.
Areas, where regulatory harmonisation should be pursued, are the areas ofmaterial recycling/re-use and energy recovery which are essential for both
EU and Japan economies if they are to become circular.
Work together at the multilateral level to promote international
harmonisation of energy efficiency regulations, relevant labelling rules,
environmental and carbon footprint schemes, traceability tool for
information transfer in supply chain.

The BRT believes that:•

Only through a common approach can many of the energy and environment
related issues be solved. It is therefore vital that the EU and Japan show
leadership in the field at ISO and IEC level.

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3.

Expand the benefits of AEOs
The BRT calls on the EU and Japanese Authorities to:••

Aim at introducing further regulatory cooperation in order to give more
concrete benefits to AEOs.
Focus on introducing real advantages without increasing the administrative
burden for companies by granting more freedom, simplification andresponsibility to companies.

The BRT believes that:••4.

A smoother logistical system where benefits are given to companies thatcan show that they have the capacity to properly trace each shipment.
This is also beneficial for the authorities as the will be able to focus more on
illegal shipment and to support companies that have less capacity regarding
traceability.

Adoption of UN Regulations and promotion of regulatory cooperation in
the automobile sector
The BRT calls on the EU and Japanese Authorities to:•••Continue to work and promote the UNECE as a forum for global
harmonisation of the vehicle regulations.
Furthermore, accelerate their adoption of the UN Regulations to lower thecost of regulatory compliance for both European and Japanese automobile
manufacturers by extending the scope and benefits of mutual recognition.
Work together to establish internationally harmonised technical standards
and testing procedures that will encourage the development and smoothmarket adoption of environmentally friendly and safety vehicle technologies,
such as electric, hybrid and fuel cell vehicles, carbon-neutral fuels, as well
as autonomous and connected driving technologies.

The BRT believes that:•5.

A common regulatory framework will send a strong signal to the rest of theworld that harmonisation and the UNECE is the adequate forum.

Sanitary and phytosanitary regulation
The BRT calls on the EU and Japanese Authorities to:•

Use the EPA to further harmonise the SPS framework. This should be done
at a detailed level to avoid any divergence. The overarching principle shouldbe that if a product is approved in one market it should be regarded as
approved in the other market, without the need for additional testing or
market approvals.

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The BRT believes that:•

Harmonisation and mutual recognition are vital to achieving the goal of increasing
exports of food and drink, which is a priority for both the EU and Japan and one on
which considerable resources are expended.

WP-1 / # 04 / EJ to EJ

Avoiding double contributions on social security

The BRT welcomes the conclusion of social security agreements between Japan and
13 EU Member States. Negotiations or preliminary talks are under way between Japanand some additional EU Member States.
The BRT calls on the EU Members States and Japan to:••

Swiftly conclude bilateral agreements so that double pension payments are
avoided.
As in interim measure introduce regulation that either exempts employees andemployers from pension premiums or returns the paid amount of both theemployee and the employer when the person leaves the country.

The BRT believes that:•

With increased labour mobility and the need for companies to both transfer andrecruit globally the demand for social security agreements will increase.

WP-1 / # 05* / EJ to EJ Achieve climate-neutrality
Because climate change is a global challenge, the BRT appreciates the fact that the
EU and Japan have the common goal of climate-neutrality by 2050. The EU’s effort toachieve the goal is well known as Fit for 55 Package initiatives and the REPowerEU
plan which fast-forward the green transition by revising, for example, the EU’s GHG
emission reduction from 40% to 55% by 2030.
However, the road to climate-neutrality has various paths, and diverse technology
options have a role to play in an effective transition to climate-neutrality. In addition,
discussions on CBAM being concrete measures have taken place before the EU andJapan share the vision and image of the way-forward.
In this regard, the BRT calls on the EU and Japanese Authorities to:••

Demonstrate strong leadership and encourage the cooperation of all Governments
in order to build transparent and fair international trade rules and systems related
to climate-neutrality, that are consistent with international rules such as WTO.
Discuss the way-forward to properly address the carbon leakage based on carbon
intensity and avoid the hasty introduction of Carbon Border Adjustment Mechanism(CBAM).
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wind power and the production of renewable hydrogen and ammonia in order tohelp to accelerate deployment of these technologies.

WP-1 / # 06* / EJ to EJ
IssuesRecommendation on BEPS Action Plan and Other Tax

The BRT supports the creation of an internationally fair taxation framework and levelplaying field. At the same time, the BRT believes that taxation system should be
simple and transparent as possible and should not create excessive administrative
burden on businesses.

BEPS Action Plan
The BRT calls on the EU and Japanese Authorities to:
•
•
•
•
•

•
•

Ensure that the implementation of BEPS Actions do not create additional
administrative burden on businesses;
Request to file CbCR only to MNE’s top parent company but not to MNE’s
subsidiaries in accordance with the OECD suggested protocol;
Aim at facilitating the conclusion of bilateral and multilateral APAs;
Keep confidentiality of information concerning taxpayers as BEPS Action 13
demands;
Give specific consideration to the global trading business model broadly
conducted by the financial services industry in terms of Permanent Establishment(“PE”) that the tax authorities in European Countries give utmost consideration
before making any tax assessment based on the determination that a trader
booking into an offshore booking entity under the global trading business should
qualify as dependent agent;
Give utmost consideration to the implementation requirements in otherjurisdictions before implementing new tax rules, which may or not be BEPS
Action 13 and 7 related;
Avoid unnecessary uncertainty for compliant taxpayers and unintended double
taxation as was agreed by OECD/G20 countries in 2013.

Other Tax Issues
The BRT calls on the EU and Japanese Authorities to:••

Include all EU Member States and Japan in the mandatory binding MAP
arbitration in their bilateral tax treaties which the commitment was made by 25
countries including Japan and 24 EU Member States as a mechanism toguarantee the resolution of treaty-related disputes within a specified timeframe;
Pursue simpler, lighter and sensible tax systems which will lead to growth andinnovation, and furthermore, reduce time and cost for both businesses to comply
and tax authorities to enforce;

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••Eliminate double taxation and modernise tax treaties between EU Member States
and Japan to ensure that royalty, interest and dividend payments are exemptedfrom withholding taxes to the greatest possible extent.
Cooperate to establish a reasonable global framework regarding digital taxation
currently discussed in the OECD in order to avoid economic confusions.

WP-1 / # 07* / EJ to EJ Ensure timely negotiations on bilateral/regional
agreements on personnel movements under the COVID-19 and future pandemics
With the advent of COVID-19, countries around the world introduced border
restrictions. In many cases non-residents were not able to enter certain countries, butthere were also restrictions which meant that only nationals of a specific country wereallowed to enter. This led to difficulties for companies in many aspects: succession inregard to top management, the inability to bring in both short-term and long-term
specialists, such as engineers, and other personnel that are vital for any expansion
plans. It also negatively affected many SMEs as they often lack a local presence but
is dependent on being able to travel to the various markets. We know from such
experiences that without the possibility to travel freely between the two regions,overseas business operations will suffer.
The BRT calls on the EU and Japanese Authorities to:•••

Draft an action plan on how to deal with future pandemics with s focus on travel
restrictions.
In case of another pandemic, begin negotiations in a timely manner to allow
businesspeople to travel between the EU and Japan for short business trip.
Ensure that companies can bring in new top management, such as CEOs, andspecialists, such as engineers, without hindrance. This is of the utmost
importance for the proper operation of overseas subsidiaries.

The BRT believes that:•

It is important that companies can continue to provide vital services and that
adequate personnel, both CXOs and specialists, can enter both regions. This while
adhering to the proper health protocols put in place by the authorities.

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Recommendations from
European industry to Japan
WP-1 / # 08* / E to J
Harmonisation & mutual recognition of standards andproduct certifications; acceptance of international standards where applicable
Industry still faces standards and products certifications that are not harmonised withinternational standards or regulations. Furthermore, some overseas approvals, despite
having being issued in accordance with EN and/or ISO, are not recognised by theJapanese Authorities. This leads to delays in the introduction of innovative new
products to the market and increases import costs. While accepting the need tosafeguard consumer health and safety, the BRT urges Japan to promote theharmonisation of standards and certification procedures, the mutual recognition of
product certification and, in areas where harmonized standards do not exist, the mutual
approval of the import, sale or use of products that have been approved on the basisof functionally equivalent requirements, so that products certified for one market areautomatically accepted in the other market. The BRT recommends the Japanese
Government to place particular emphasis on:

Automobiles
The EPA agreement in principle ensures that “both Japan and the EU will fully alignthemselves to the same international standards on product safety and the protectionof the environment, meaning that European cars will be subject to the samerequirements in the EU and Japan, and will not need to be tested and certified again
when exported to Japan”.
However, in this area a big gap has to be seen between the ambition of the Agreement
and the reality. This is due to the transition periods of up to 7 years, several exemptions
and specific provisions in some areas. All in all, the Agreement does not significantly
change the current status to an improved situation.
It has to be feared that under the current provisions of the Agreement, improvements
will be seen only gradually and slowly. Especially in the important area ofemissions/fuel consumption, the discrepancy is expected to last.
The BRT calls on the Japanese Authorities to:
•
•
•

•

Abolish its remaining unique regulations, including the standards for exhaust gases
Promote further harmonization in areas currently not covered by the agreement,
Change optional to mandatory conditions regarding the approval of EU certificates,
especially in the area of emissions/fuel consumption to ensure that – as intended
by the EPA – vehicles will not need to be tested and certified again when exported
to Japan,
Use the Automotive Working Group to increase the benefits in this area by
speeding up the envisaged changes and widen the harmonization efforts.

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Railways
The BRT calls on Japan to:•••

To be more involved in introducing a national system for conformity assessment
and to encourage mutual recognition of testing and certification. The BRT believes
that a working group led by the Japan authorities including both domestic andforeign companies from all railway related sectors should be established.
Take extra care that standards and testing required by Japanese operators arecommunicated in a transparent manner so that European suppliers can meet andexceed these requirements.
Should promote more off-the-shelf solutions instead of creating Japan specificsolutions that are difficult to implement elsewhere.

The BRT believes that:•

A national testing scheme would lower the costs for suppliers and would at thesame time make it easier for the authorities to make certain that railway relatedcompanies fulfil the proper safety requirements.

Processed food
While the EPA offers lower tariffs, the regulatory situation for companies still remains
the same. This means that companies have to spend significant resources and money
to fulfil requirements that are often unique to Japan.
The BRT calls on Japan in collaboration with the European authorities to:•••

Recognise European approvals and test methods
Harmonise with internationally approved food additives and enzymes
Harmonise or mutual recognise regulations surrounding the need to test forradioactivity

The BRT believes that:•

With more recognition of European approval and test results, Japanese consumers
will benefit from more and cheaper European products.

WP-1 / #09* / E to J

Self-verification and risk assessment

Risk assessment and self-verification become more and more common as production
cycles become shorter. This in order to offer a way to shorten the time to introduce a
product to the market and at the same time ensuring that proper responsibility is taken
by companies. While self-verification is used in Japan too, government or third party
approval is often the norm. Examples of products could be base stations, food contact
materials, non-invasive medical equipment, electrical products etc.

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The BRT calls on the Japanese Authorities to:•

Expand the use of self-verification while ensuring that proper care is taken toprotect the safety of human life, as well as animals and plants.

WP-1 / # 10* / E to J

Wind power

The development of wind energy is essential for Japan to reach its CO2 emissions
targets and to achieve net-zero emissions by 2050. Modern and cost-efficient windturbines now contain sophisticated technology that works well with established power
grids of all kinds, ranging from large transmission systems to isolated local grids. The
6th Strategic Energy Plan announced last year is the Japan’s roadmap toward carbon
neutrality by 2050. Under this plan, the renewable energy is regarded as the prime
source of power and the government declared its commitment to prioritize theenhancement of the renewables. In this context, the government is targeting to makethe renewables represent 36 – 38% of power generation by 2030 and to install 5.7 GWof offshore wind farms by 2030.
The BRT calls on the Japanese Authorities to:•

Implement a drastic reform on the offshore wind farm certification process. The
current setup has been inducing lengthy and unpredictable process which serves
as a bottleneck for earlier financial closure and subsequent COD .
➢ Duration for certification: The certification process should be completed in 1 1.5 years which is typical in Europe. It currently takes 3 - 4 years in Japan➢ Language: English language should be allowed in all communications.
➢ Document-based review process➢ Expand the use of international certifications and standards•

Japan should expand/upgrade the already-selected marshalling ports (Akita,
Noshiro, Kashima and Kitakyushu) and/or develop additional marshalling ports andmake them ready preferably by 2027 so that all or most of the round 2 and 3
projects would be able to start their offshore installation campaign from 2028 andto make the wind farms operational by 2030.
Enable the use of foreign registered vessels, as well as foreign crew on said
vessels for projects related to off-shore wind.

•

WP-1 / # 11* / E to J

Automobiles

Kei cars and other motor vehicles continue to be subject to different treatments in termsof tax, insurance and parking rules. Although METI and JAMA have suggested
reducing the level of discrepancy in taxation to the order of 1:2, for the time being, thediscrepancy in the base level of taxation of kei cars and subcompact cars at 1:3.3
remains unacceptably wide.
The BRT calls on the Japanese Authorities to:•

Put kei cars and other motor vehicles on the same fiscal and regulatory footing.

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WP-1 / # 12* / E to J

Freight and logistics

Further to the WP-1 / # 03 / EJ to EJ, the BRT recommends that Japan revises its AEO
system to introduce real benefits for operators regardless of whether they are
forwarders, customs brokers or importers. Furthermore, the administrative load needs
to be lessened if companies are to be truly attracted to the AEO status.
The BRT calls on the Japanese Authorities to:
•
•
•
•
•

Allow a bonded warehouse to act as a port of first entry with regard to products
covered by quarantine related regulations.
Promote Electronic Delivery Order for ocean freight
Take the lead in trying to digitalise the logistics industry as currently many
Japanese companies, including large companies, are still using fax and paper
orders.
Allow smartboxes to be part of the container. Only in Japan does this has to be
declared as part of the cargo, hence it has to be declared for import.
Make it possible to have more than 100 entries on import declarations.

The BRT believes that:•

A more seamless and flexible transport sector will have a positive impact on thegeneral flow of trade and better facilitate the improved market access offered by
the EPA.

WP-1 / # 13 / E to J

Aeronautics

Haneda D runway weight restrictions are an obstacle to the use of European-madeaeroplanes and an obstacle to further development of international traffic at Haneda.
These weight restrictions should be re-examined to allow the operations of new andlarger aeroplanes such as Airbus-made A380 and A350.
The BRT calls on the Japanese Authorities to:•

Re-examine the weight restrictions to allow the operations of new and larger
aeroplanes such as Airbus-made A380 and A350. This should be in line with theapproval of the 747-8i which is in the same category as the A380 (code F aircraft).

The BRT believes that:•

If Japan is to re-open and return and exceed pre-COVID levels in regard to visiting
tourists, due to limited numbers on slots on Haneda, aircraft such as the above
mentioned will be vital.

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Recommendations fromJapanese industry to the EU
WP-1 / # 14 / J to E

Chemical Regulations

CSS (Chemical Strategy for Sustainability)
The BRT calls on the EU Authorities to:••

The action plans including the revision of the REACH/CLP regulation currently
being considered by the EU Authorities to achieve CSS’s “zero-pollution” ambition
without hazardous substances should be promoted based on appropriate risk
(hazard x exposure) assessment of chemical substances.
The BRT requests that this action plan will ensure that chemical substances, which
can be used safely through appropriate risk management and are indispensable
for realizing a sustainable society, are not excluded from the market.

The BRT believes that:
•

•

•

•

The EU government is considering proceeding the restriction and ban of chemical
substances based on hazard rather than on risk, which is not in line with theprinciple of the REACH regulation, because the restriction and ban of chemical
substances need to be more extensive and accelerated than before in order toachieve “zero-pollution” without hazardous substances.
On the other hand, chemical substances are indispensable for all kinds of products
and technologies, and if chemical substances are restricted or banned withemphasis on hazard, many related products and technologies without alternative
substances will disappear, which could have serious negative impacts on society.
While the EU government’s “zero-pollution” philosophy is understandable,chemical substances should be used with appropriate risk management, and theidea of restricting or banning chemical substances by focusing on hazard isunacceptable.
In the EU Taxonomy, which was enacted to promote sustainable investment in theEU, “pollution prevention and control” was set as one of the environmental goals,
and a hazard-oriented “List of substances of concern” was created to replace thesesubstances with safer alternatives in order to reduce pollution. The manufacturingof these substances will significantly be discouraged, and the BRT is concernedthat chemicals that are essential to realize a sustainable society and whose
pollution can be avoided through appropriate risk management will be excluded
from the market without scientific discussion.

The BRT calls on the EU Authorities to:Legislate on risk assessment basis depending on exact exposure situation and use
amount by each sector, when assessing health/environmental impact of eachchemical substance which are used by multiple sectors.

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The BRT believes that:

Establishment of a ‘One substance, one assessment’ process under action plan of
CSS will possibly lead excessive restriction for specific sector on hazard
assessment basis, especially in case that the use amount by each industry islargely different.

REACH
The BRT calls on the EU Authorities to:•••European Commission is planning to review the REACH regulations, and it
includes the establishment of the registration rules for polymers. Polymer
registration rules should be applied only for the polymers which have high concern
for human health and the environment, and not applied for the low concern
polymers, same as the other nation rules.
For that reason, the EU should adopt the PLC (Polymer of Low Concern) concept
in international alignment (harmonisation) and develop scientifically valid and clear
criteria for the identification of PLCs to be exempted from registration requirements.
The abolition of the current constitution monomer registration rules for imported
polymers, instead of the introduction of the new polymer registration rules.

The BRT believes that:•

The monomers registration rules are not impartial system, because it is obliged
only for companies which import polymers from outside of EU, and not necessary
for polymer procurement from EU inside. In many cases, non-EU chemical
manufacturers do not produce polymers by themselves but purchase from outside
and prepare them, so they have to ask upward of supply chains for various kindsof monomer information necessary for registration. It becomes a heavy burden for
non-EU companies, and acts as a kind of non-tariff barriers.

The BRT calls on the EU Authorities to:•

There are many and well-reliable chemical data in the REACH, and the EU
authorities have a privilege to take an initiative on the international actions for data
sharing. Given this situation, they should encourage the REACH registrant to sharethe data with the applicants in the other chemical regulations outside of EU, forinstance, by the preparation of the rules or guidance designated for theinternational data sharing.

The BRT believes that:•

For protection of human health and the environment, it is significant to utilize thephysical and hazardous data of REACH registration for the chemical regulations in
the other nations. In addition, from the viewpoint of animal welfare, it is important
to avoid unnecessary animal studies by utilizing them as much as possible. But inreality, troubles happen in some cases now. For example, in Korea, when thenegotiations between the REACH registrant and the representative for registration
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of K-REACH are in difficulty, Korean companies are eventually forced to do thetest by themselves and it causes the problems. It is not clear with whom we should
negotiate, and there are no rules for appropriate cost sharing, which could also
occur in the future registration under the UK REACH, Turkish KKDIK Regulation(Turkish REACH) and Taiwan Toxic Chemical Substances and Substances ofConcern Control Act.
The BRT calls on the EU Authorities to:•Once a substance evaluation has been completed under REACH, its conclusions
have to be respected and should not be revised/overturned unless new findings ordata become available.

The BRT believes that:•

If the conclusion of a substance evaluation officially finalized in the REACH
process is later challenged and overturned, despite the absence of new scientificinformation, by a Member State due merely to differences in their ways of thinking,the dependability and predictability of regulatory decisions will severely be
impaired.

The BRT calls on the EU Authorities to:•••

Careful consideration should be given to whether it is essential use.
In the reform of authorisation and restrictions, risk-based and socio-economic
assessments should remain.
In expanding the use of the generic risk management approach (GRA), the use of
the GRA should be permitted on the condition that safety is ensured throughappropriate risk assessment of the work environment, safety considerations fromthe design stage and measures such as personal protective equipment andtraining.

The BRT believes that:
•
•

•
•

Balancing the risk assessment based on the latest scientific methods and social
usefulness of chemicals is the fundamental concept in chemicals management.
It should not be important whether it is an essential use or not, but whether therisks can be managed and the magnitude of the benefits, and it is difficult to define
essential use in terms of not only current substance and use information, but also
foreseeable future social utility.
Clarification and simplification of authorisation as well as maintenance ofrestrictions are considered the best proposals.
While we acknowledge that the GRA is often effective in consumer applications,
we believe that proposals to extend it to specialist applications could result in theloss of opportunities for specialist use of substances that are useful to society.

The BRT calls on the EU Authorities to:•

In the integration of the REACH registration tonnage range 1-10t/year and 10100t/year, the increase in hazard information is an excessive demand including
animal tests and maximum consideration should be given to reducing the burden.

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The BRT believes that:
•

•

•

•

The EU committee is refining REACH mainly to simplify the system for the following
reasons; 1) Authorization puts a heavy burden on businesses and authorities; 2)
Restriction process takes too much time. However, the BRT believes that decisions
based on scientific risk assessment and cost-benefit assessment are more
important for building a sustainable society than expediting legal procedures or
reducing the burden. In addition, it is important that the items listed in the REACH
revision be designed based on current scientific standards and in consideration ofinternational harmonization of chemical management systems.
Increased hazard information does not lead to protection of the environment or
health. It would also have a significant impact on businesses in low tonnage areas.
In order to reduce the risks associated with unintended exposure to mixtures, weconsider it hasty to conclude that mixture assessment factors are the mostappropriate approach in the short and medium term, because we do not have a
globally accepted methodology for evaluation of combination effects.
With regard to the provision of information on the environmental footprint of
substances (e.g. impact on climate, natural resources, biodiversity), it isconsidered premature to incorporate such methodologies into REACH in theabsence of standardised methods and global harmonisation.

CLP Regulation
The BRT calls on the EU Authorities to:
•
•
•

•
•
•
•

The introduction of new hazard classes (Endocrine Disruptor, PBT/vPvB,
PMT/vPvM, etc.) to the CLP Regulation should be done after their integration into
UN GHS.
If CLP is going to introduce a new hazard class prior to the UN GHS, it should beensured that the impact on the global supply chain, including products necessary
to build a sustainable society in Europe, is minimal.
In introducing a new hazard class, consideration should be given to updating the
SDS system, securing relevant testing institutions to classify Endocrine Disruptor,
and determining the time when evaluation by testing institutions becomespractically possible. Preventing confusion in the global supply chain and theestablishment of guidelines are also required.
Since these new hazard classes are the first hazard identification in the world, we
believe that longer introduction deadline should be set than at least 5 years.
Expanding the scope of products covered by the CLP Regulation, where
discussion is separately underway, should be carefully considered, as the impact
on the EU market is expected to be even greater.
The definition of its hazard class should be discussed and determined scientificallyin public.
Material durability is important as a material property for sustainability, and webelieve that the use of PBT substances is inevitable with minimized risk. And
PMT/vPvM concept should be introduced as a criterion to select substances to bemonitored, instead of substances to be limited to use.

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Page 23 of 28•We believe that it is still premature to adopt endocrine disruption because there
are neither internationally agreed evaluation method nor judgment criteria. It is also
noted that endocrine disruption is a mode of action, not a hazard.

The BRT believes that:•

Introducing new hazard classes to the CLP Regulation prior to their introduction to
UN GHS will go against the basic principle of UN GHS, i.e. global harmonization,and impair international consistency.

Appropriate approach to endocrine disruptors
The BRT calls on the EU Authorities to:••

The substance which may have a potential for endocrine disrupting effect shouldbe evaluated and eventually nominated as SVHC with special care as much as
possible.
The Authorities of the EU should promote the action to make subjects about the
low dose effect by endocrine disruptor clear with a tangible deadline.

The BRT believes that:•••

Some substances, like “3-BENZYLIDENE CAMPHOR” concluded as SVHC fromJanuary 2019, are concluded as SVHC based on the endocrine disrupting potential
for human and environment, by the reason that the potential can be observed insome kinds of creatures, although the subjects mentioned as following are notreached a clear scientific conclusion. On the other hands, in reality, markets tend
to eliminate the substances listed on the SVHC list before actual hazard level
becomes clear, in case of the possibility to be added them to authorization in the
future.
The subjects about potency of endocrine disruptors are not reached clear scientificconclusions yet, like it can be settled any thresholds of endocrine disruption or not,and the thresholds can be measured or not.
Activities such as those related to “EFSA Scientific Committee Opinion on
biological plausibility of non-monotonic dose responses and their impact on the risk
assessment” for which public consultation started from 4 December 2020 are
welcomed, and continued open discussions for the establishment of risk-based
evaluation methods based on scientific knowledge will highly be appreciated.

Fluorochemicals
The BRT calls on the EU Authorities to:•With regard to the publication of the “Registry of restriction intentions (RoI)” for the
restriction of PFAS, the EU authorities should take full account of the socioeconomic assessment to determine the level of regulation, as PFAS is expected
to contribute significantly to the realization of the European Green Deal policy andWorking Party 1: Trade Relations; Investment and Regulatory Cooperation; Financial Services, Accounting and Taxation
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Page 24 of 28•the sustainable growth of the EU economy in the future due to its features such as
chemical and weather resistance.
The RoI on the proposed restriction of PFAS indicates a blanket regulation of PFAS
as a whole. However, PFAS includes various substances with different
characteristics (e.g. physical properties and safety profiles). It is not scientific toregulate PFAS collectively without considering the properties and safety of
individual PFAS, and there is concern that unnecessary restrictions may be placedon safe and useful substances, resulting in social losses. BRT believes that theneed for regulation for an individual substance or a substance group should bedetermined by, if necessary, grouping substances based on scientific grounds andaccording to the outcome of the risk assessment of the individual substance orgroup conducted based on scientific data.

The BRT believes that:•••

While it is understood that the grouping approach for PFAS restriction is an
initiative based on the precautionary principle, the risks to human health and theenvironment should be appropriately weighed against social benefits, and that it isnecessary to relax restrictions on the use and usage of PFAS where thecontribution is judged to outweigh the risk.
We believe that the introduction of grouping approach for restriction should beapplied carefully to ensure that it does not result in double regulation with existing
regulations. (e.g. PFAS, which are subject to strict controls under the F-Gas
Regulation (Regulation (EU) No 517/2014) in order to meet the greenhouse gas
reduction target of the EU Green Deal (at least 55% below 1990 levels by 2030)).
There is a concern that the lack of effective measurement and evaluation methods
for PFAS may cause significant disruption in supply chain management.

RoHS
The BRT calls on the EU Authorities to:•

The Authorities of the EU should keep harmonized and consistent in the operationof RoHS and REACH, and aim to do prior confirmation and adjustment to prevent
confusion in the correspondence of supply chain, like the past case of the SVHC
concentration criteria in the article which the multiple interpretations existed andbecame problems.

Nanomaterial
The BRT calls on the EU Authorities to:••With respect to the REACH ANNEXES which newly specify the necessary subjects
for registration dossier about nanoforms, the compliance of the Dossier should be
evaluated considering that the relevant knowledge and tools, such as the OECD
test guidelines and grouping tools, have not be fully available for the registrants.
Attention should duly be paid to the international harmonization in the revision of
the definition of nanoforms.
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The BRT believes that:•••

The test methods or tools of nanoforms which REACH ANNEX requests are underdeveloping.
In Commission Recommendation of 10.6.2022 on the definition of nanomaterial,
nanomaterials were defined on the basis of length, diameter and aspect ratio. In
applying this definition to the respective legislation, the impact caused by the newnanomaterial designation will need to be carefully considered in the future.
It is expected that different individual sectors will update their internal definitions
according to the revised definition after the new recommendation is implemented.
The originality of the sector should be accepted, because the surrounding
situations are totally different depending on sectors.

WP-1 / # 15 / J to E
(BEFIT)••

Business in Europe: Framework for Income Taxation

The BRT hopes that the Member States will keep the tax system simple andsensible, and focus on fostering growth and investment.
The BRT encourages the EU to aim at making the Best Practice corporate tax
system in the world to which countries around the world would aspire.

WP-1 / # 16 / J to E

Sustainable European Future

Policy on Corporate Sustainability and Responsible Business Conduct (RBC)
The BRT calls on the Authorities of the EU to:••

Ensuring policy coherence to achieve EU’s objectives of sustainable development
and a competitive social market economy and create an enabling environment toencourage the uptake of both individual and collective actions to maximise positive
impacts while mitigating negative ones.
Support dialogue as a powerful tool to advance towards a sustainable future. BRT
recognises that the Committee on TSD under the EPA will be a platform for the EU
and Japan on sustainability. This committee should have an open and transparent
nature and involve broad participation from the real economy. It would beparticularly beneficial to exchange best practices between Japan and the EU, andto gather views on the future policy trajectory in the two regions and globally.

Disclosure and transparency (EU corporate sustainability reporting)
The BRT believes that:•

Corporate sustainability reporting is a communication tool of company’s value
creation process between the company and its stakeholders, as well as an internalmanagement tool which enables companies to develop and evaluate their long-

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term business model and strategy. Therefore, it is our position that sustainability
reporting should never become a tick-box exercise used by companies solely as acompliance tool. On the other hand, sustainability reporting standards must not
impose excessive administrative burdens on companies, as this would hamper thebroader efforts in creating and realising innovations essential for the achievementof the European Green Deal.
The BRT calls on the Authorities of the EU to:
•

•
•

•

Promote the international interoperability when creating EU sustainability reporting
standards to avoid double reporting for companies. EU reporting standards need
to be aligned with ISSB’s global base approach and allow companies to report only
the ESRS’s additional requirements, on top of what is already being reported
based on international frameworks.
Clarify the equivalence mechanism of EU standards and recognise ISSB asequivalence standards.
Take reasonable consideration of the burden imposed on companies as well as
the usability of data for users.
➢ Adopt the prioritisation and phase in approach for making reporting more
effective and more reliable.
➢ Too detailed and granular double materiality requirements would lead to thesignificant restructuring of companies material assessments.
➢ Recognise that companies have to deal with taxonomy disclosure
requirements at the same time which is new and entails complex structured
requirements.
Emphasise dialogue as an equally valuable means for companies to strengthen
the trust of their investors and stakeholders and leverage the improvement ofcompanies’ internal practices by incorporating dialogue into the PDCA
management cycle. It is a powerful tool in fostering a culture of risk management
and innovation, whereby companies across different cultures can exchange views
on potential future risks as well as explore collaborative opportunities.

Corporate Sustainability Due Diligence and forced labour
The BRT underlines the need to acknowledge the diversity of stakeholders’ interests,
as stakeholder engagement is vital to incorporate sustainable corporate governancein practice. BRT supports the EU’s ambition to enhance due diligence in corporate
management processes and recognises the importance to encourage a ‘culture of noharm’.
The BRT calls on the Authorities of the EU to:••

Make due diligence obligations implementable and bring a high level of legal
certainty for companies.
Ensure that the EU framework is aligned with international standards – including
the UN Guiding Principles for Business and Human Rights (UNGPs) and theOECD Guidelines for Multinational Enterprises (OECD MNE Guidelines).
International harmonisation is of paramount importance, as companies’ operation
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•

•

•

•

and value chains are not limited to within the EU, but also deeply rooted in third
countries.
Urge the governments to work with industries and other countries to solve thefundamental issues of supply chains. BRT asks the Commission to build up acredible database as well as to establish guidelines, and a helpdesk wherecompanies can rely on expertise.
Provide companies sufficient preparation and time to be equipped and resourced
to comply with the new requirements. BRT believes that it would be more realistic
if the application of such new requirements are gradually phased in, with regularreview to ensure the effectiveness of the new requirements.
Avoid blacklisting countries with EU self-classification rule, which is against WTO
rules, in terms of forced labour legislation as it will discourage (often irresponsibly
operating) companies to engage in high-risk markets, not solving root cause offorced labour issues throughout the global supply chain.
Avoid requiring proof at customs clearance that products imported into the EU areforced labour free as such proof can hardly be prepared by companies alone.

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