Recommendationsof theEU-Japan Business Round Table
to the Leaders of the European Union and Japan
5 November 2020

Working Party 3
Digital Innovation and Mobility

Working Party Leaders:Mr. Frédéric SANCHEZ
Chairman of the Executive Board
Fives GroupMr. Hidenori Furuta
COO, CTO
Fujitsu Limited

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List of Abbreviations
Abbreviation
AI
BASA
BRT
EASA
EPA
EU
GDPR
ICT
IFR
INATBA
IoT
ITA
M2M
NIS
SME
R&D
WP
WTO

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Meaning
Artificial Intelligence
Bilateral Aviation Safety Agreement
EU-Japan Business Round Table
European Aviation Safety Agency
Economic Partnership Agreement
European Union
General Data Protection Regulations
Information & Communications
Technology
Instrument Flight Rules
International Association for Trusted
Blockchain Applications
Internet of Things
Information Technology Agreement
Machine to Machine
Network Information Security
Small and Medium-sized Enterprise
Research and Development
Working Party
World Trade Organization

Introduction
Digital Innovation
The BRT highly appreciated that both EU and Japanese government have positioned
the digital agenda at the heart of their respective growth strategies and achieved
significant progress since the last Business Round Table held in May 2019.
It has to be noted that COVID-19 revealed that digital transformation is required in
sectors more than ever.
With COVID-19 global pandemic, the EU and Japan are facing unprecedented
challenges to balance the health and well-being of our societies, and economic
activities. The BRT urges both authorities to mobilize all necessary tools for thedevelopment and deployment of innovative solutions and products to cope with thecontainment of COVID-19 and the post-COVID-19 recovery.
The BRT is supportive of the concept that building trust between stakeholders isessential to achieve digital transformation. We believe that an open debate between
stakeholders and the civil society will reap the benefits of digital transformation.
The BRT welcomes that EU and Japan recognize the importance of promoting freeflow of data ensuring confidence and trust in business and society as a whole.
The BRT appreciates EU-Japan cooperation on enhancing digital connectivity as anenabler of inclusive growth and sustainable development including in developing
countries by launching the Partnership on Sustainable Connectivity and Quality
Infrastructure and expanded cooperation agreements between the European
Investment Bank (EIB) and the Japan International Cooperation Agency (JICA).
The BRT expects further cooperation between both authorities and take aninternational leadership of in the area of digital transformation.
Aeronautics
EU and Japanese industries are major suppliers to the global aeronautics market.
Both, however, are challenged by aggressive new entrants. In this context, joint
technology and project development is necessary for both sides to maintain theirtechnological leadership and competitiveness.
EU-Japan industrial cooperation already exists in helicopters and aeroengines, butthere is much more potential. More government-led cooperation and continued
support from both authorities is needed to help the European and Japanese aircraft
industries bring to fruition the development of their relationship while meeting the
EU's environmental, social, and safety requirements.
Space
EU and Japanese space industries are major suppliers of space products and services.
The global commercially accessible space market, however, is small with limited
growth prospects.
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As government budgets remain low and competition increases, mutually open markets
and cooperation are a possible opportunity for the EU and Japan to achieve their goals
in space and for their industries to realize their full potential in the global market. We
are satisfied with the meetings of the EU-Japan Space Policy Dialogue and want themto continue on a regular basis.

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Recommendations from both
European and Japanese industries
Digital Innovation

WP-3 / # 01* / EJ to EJ

Cooperation for Global Digital Trade Rule Making

The BRT calls on the EU and Japanese Authorities to:Agree on a text facilitating the free flow of data between the EU and Japan, when
the next EU-Japan EPA, expected within three years of the EPA coming into force
is reviewed.



Implement the EU-Japan EPA’s Regulatory Cooperation framework to facilitate thedigital transformation on both sides.

Work with industry and like-minded governments to address policies and practicesof third countries that unjustifiably restrict the movement of data and create unfair
competitive conditions, including market-distorting subsidies, unjustified forced
data localization measures and other requirements to use local servers andsoftware.



Stay committed to free trade and multilateralism and develop a high standard for
WTO rules on e-commerce to secure the strongest possible commitments forconfronting barriers to trade and facilitating the development of strong,interoperable regulatory frameworks in areas like privacy and cybersecurity.

Continue to lead in seeking a permanent moratorium on customs duties onelectronic transmissions.

Work with industry and like-minded governments to craft a balanced approach todata flows in trade agreements and international frameworks that guarantees ahigh level of data protection and allows data to flow freely across borders to realise
Data Free Flow with Trust.



Cooperate to increase the number of member countries for an ITA/ITA expansion
and coordinate with regard to third countries’ violation of WTO binding
commitments based on ITA/ITA Expansion.

The BRT calls on the EU Authorities to:In the case of creating an analytical framework for measuring data flows within the
EU and between the EU and other countries around the world and estimating the
economic value of these by the European Commission, it is required to see further
clarification of the purpose of this exercise as well as further explanation of who
will conduct what measurements and how, and whether such measurements are
actually technologically feasible. If the intention is to measure cross-border eWorking Party 3: Digital Innovation & Mobility
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commerce data flows, the BRT suggests that the Commission engages in aninternational discussion on the purpose and methods to be used.

The BRT believes that:

Global competitive companies rely on a data exchange across borders to produce,
export, market, and sell goods and services in global. Cross border data flows
operated in compliance with high level data protection rules, drive growth and job
creation in sectors in the digital transition area. Openness is a key driver ofinnovation. “Technological sovereignty" should be based on mutual strengtheningof the data economies and be compatible with both parties’ commitments to free
trade and open markets.

Agreement of the EU-Japan EPA and adoption of mutual adequacy decisions forthe protection of personal data provide a unique building-block for the EU andJapan to advance a common agenda at global level. Recently agreed the UK
Japan EPA is a good progress towards this direction. In addition to mutuallypromoting digital innovation and transition, efforts to promote digital trade rules atthe WTO and in FTAs are necessary to support level playing fields and long-term
growth perspectives.

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WP-3 / # 02 / EJ to EJ

Deployment of AI

The BRT calls on the EU and Japanese Authorities to:Support and encourage development and deployment of human centric andtrusted AI applications to protect fundamental rights of citizens.



Recognize that AI technology is constantly evolving and continuous effort ofdiscussion is required, and that innovative governance with agility and flexibility isrequired to encourage innovation and at the same time avoid/reduce negative
impacts on society. Regulation should only be limited to AI that generates truly
serious risks while also ensuring legal stability and predictability.



Avoid policies that pre-emptively limit or ban potentially beneficial AI applications
including remote biometrics, without clear evidence of ‘high risk’ and unravellingthe essential issues regarding citizens’ safety, health and fundamental rights.

Enable extensive testing of AI applications across different use cases/businesssectors to ensure its positive impact and reduce negative one.



Enhance an open and transparent dialogue with citizens of all generations andsegments to avoid misunderstanding and reveal the great potential of AI.



Cooperate with international partners to develop common understanding and joint
norms of AI to build ecosystems on global scale.

Continue the path of the first bilateral EU-Japan cooperation to promote a humancentric approach to AI as discussed at Ministerial meeting in June 2019 and also
as committed to extending the co-funding of joint projects in the 26th EU-Japan
Summit and to provide opportunities for collaboration between researchers fromthe European Research Council and Japan Science and Technology Agency.

The BRT believes that:

Building trust among stakeholders is essential to deploy AI in society. EU andJapanese “human centric” approaches are the right direction to build trust in AI
deployment.

To respond rapidly evolving AI technologies, combining several schemes including
soft law such as voluntary labelling guidelines on AI development and usage withregular and timely updates are appropriate. Such rules should be developed incooperation with the private sector including AI developers, suppliers and users.



AI technology itself is neutral and can be a problem or a solution depending on
how it's used. Therefore, placing legal liability on the AI developers could increase
the risk of AI technology development itself, despite being neutral in nature,
resulting in a decline of competitiveness in digital and other sectors.

Discussions on potential risks of AI applications have just started on as sector-bysector bases and it’s premature to expect then to converge. The concept of “risk”
differs depending on each sector and need to be in line with the existing one.

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WP-3 / # 03 / EJ to EJ

Privacy Protection for Trusted Digital Society

The BRT calls on the EU and Japanese Authorities to:Strengthen the EU-Japan dialogue to promote interoperability and harmonization
between regional personal data protection mechanisms around the world to ensure
the free flow of data across borders in a trusted way , in particular GDPR and APEC
Cross-Border Privacy Rules (CBPR).

Ensure that the definitions and possible impact on M2M data transfers does nothamper innovation and digital solutions.

The BRT calls on the EU Authorities to:Ensure that the e-Privacy Regulation currently under discussion in the EU is
adopted in alignment and coherence with the GDPR of the EU, protecting datawhilst allowing for innovation, ensuring the same rules apply to the same services.

The BRT believes that:

Privacy protection is crucial to build trust in the market that can support innovations
and deployment of emerging technologies.



Different regulations by countries and regions in various jurisdictions have caused
an increase in compliance costs and have become obstacles to efficient global
operations and data-driven innovations.



Uncertainty around the proposed e-Privacy Regulation and the relationship with
the GDPR and AI should be tackled as fast as possible.

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WP-3 / # 04* / EJ to EJ

Cybersecurity for Trusted Society

The BRT calls on the EU and Japanese Authorities to:
Pursue international harmonization in the field of cybersecurity, in particular thealignment between the EU cybersecurity certification schemes and regulatory
cybersecurity framework in Japan and integration of the international standards
including certification and labelling of IoT devices and services. Request that bothgovernments take the lead in introducing new security technologies for the quantum
computer age.

The BRT believes that:

Security is necessary as a precondition for creating value in cyberspace and therealization of the digital transformation. Without taking appropriate measures,
however, risks of increasing vulnerability might hold it back, or even seem tooutweigh its benefits.



Cybersecurity policy should be built on a shared responsibility in private and public
sectors.



A Global coordinated approach is effective in coping with high-level attacks. An
information sharing scheme with regards to security incidents should be createdbetween the national contact points in each EU Member States based on the NIS
directive on the one hand and Japan on the other.



Cloud computing services are within the scope of the NIS Directive. Detailed
provisions will be specified by EU Member States. The NIS Directive is a vital
Directive to mitigate risks of Cyber Attacks. The European Commission should
work to ensure a harmonised implementation in the Member States.



The EU’s approach to establish cybersecurity certification schemes for ICT, Cloud,
AI and 5G would be a great benefit to develop a safer society where IT is
penetrating and indispensable. Having said that, the EU should make full use ofand, if needed, amend to the minimum extent existing regulations so that theindustry can comply new regulations without any unnecessary burdens. In addition,
whether new cybersecurity schemes would be mandatory or not shall depend on
the risk level which also makes us believe that it must be clearly defined whatcybersecurity risks are in products/services or usage scenes.

The advent of the quantum computer age is expected to make existing
cryptography obsolete. New security technologies for the quantum computer age
are now in the stage of practical application, and the introduction of thesetechnologies will benefit both the public and private sectors.

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WP-3 / # 05 / EJ to EJ

Creating a Blockchain-friendly Environment

The BRT calls on the EU and Japanese Authorities to:Create a blockchain-friendly environment that enables businesses and consumers
to be part of the blockchain landscape and promote strong international
cooperation to remove legislative obstacles to blockchain applications andsolutions across borders.

The BRT believes that:

The blockchain technology has the potential to disrupt many markets as its
properties and characteristics enable new forms of user participation and new
business models.



Immutability of the data will lead to smart, automatically enforceable, contracts
under which the authenticity of the data is clear and reliable.



Although the principle of technology neutrality means that the same regulatory
principles should apply regardless of the technology used, some changes shouldbe blockchain specific, if the advantages of the blockchain are to be fully utilized.



The BRT supports the INATBA (International Association for Trusted Blockchain
Applications) initiative. INATBA is showing a high potential for acting as a bridge
between Public and Private Sector and is growing in terms of membership andstaff. This will allow the Association to expand its impact and ability to work
internationally at different level by promoting open cooperation in many industry
sectors in which Blockchain can have a concrete impact. It is important to promoteinteroperability among solutions developed in different countries and sectors. Also,
standardization, best practices exchange, and Public Private Partnerships arerecommended. After a first year of activity where INATBA set up its own structureand started its first activities (i.e. the organization of the first Congress in November
2019 in Malaga – Spain) it is now time to enter in a more mature phase in which
the Association will advocate for a harmonized adoption of blockchain solutions in
Europe, Japan and at the global level.

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WP-3 / # 06 / EJ to EJ

Fundamental Reform of the Private Copying Levy
System (Compensation System for Private Copying)

The BRT calls on the EU and Japanese Authorities to:

Cooperate to thoroughly reform the levy system with regard to private copying
taking into account the evolution of technology and distribution channels for lawful
consumption of digital contents. Expansion of the current levy system to anincreasing number of devices and cloud services should be avoided. Instead any
new levy system must be based on independent studies that the actual use of
copyrighted works and demonstrate the harm to the right holders resulting from theuse.

The BRT believes that:

Any review for reform should consider, in a comprehensive manner, alternative
methods available to secure adequate compensation of rights’ holders andcreators from private copying as well as the development of licensed cloud-based
content streaming models. The goal should focus on reforming the system to be
more transparent, predicable, and balanced, and to avoiding distortions. Also, a
new system shall be fair to consumers, rights holders, and service and equipment
providers at the same time. In order to achieve these goals, we recommend,
1. Keep a close look at copyright levies developments in the Member States witha view to prevent internal market distortions.
2. Ensure that Member States properly implement the EU legislation and case law.
3. Come forward with a recommendation for a clear and common approach to thecalculation and application of a copying levy.

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WP-3 / # 07 / EJ to EJ

Updating Connectivity for Digital Transformation for
All (5G)

The BRT calls on the EU and Japanese Authorities to:

Reinforce initiatives regarding sharing of progress towards 5G commercial service,e.g. through sharing of trials plans and results.



Share good use cases of application using 5G network.

Reinforce cooperation regarding these initiatives and promote events in thisdomain.

The BRT believes that:

Ensuring availability of connectivity for all is a necessary condition so that all
citizens are able to enjoy the benefits of the digital transformation.



5G is a key pillar for accomplishing the digital Society 5.0. Governments and the
EU institutions should establish without delay policy frameworks to encourage thenecessary investment from businesses and to ensure that trustworthy and secure
5G infrastructure will be available to all on a sustainable and market-oriented basis.



5G has important consequences in all fields of industry not only for innovative
services, but also to tackle various global challenges such as climate change,
natural disasters and infectious diseases as a vast amount of relevant andtrustworthy data and analysis are required across borders to tackle thesechallenges.

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WP-3 / # 08* / EJ to EJ

Skill Development for Digital Economy

The BRT calls on the EU and Japanese Authorities to:Take actions and invest to raise awareness and educate for all generations to gain
benefits and confidence in digital transformation including cyber security, AI,
Robotics and so on.

Support the creation of the skills which are necessary to fulfil the requirements of
the new job opportunities coming from new technologies.



Foster digitalization of SMEs and participation to digital economy.

The BRT believes that:
New technologies such as AI and Robotics should be perceived as new opportunities
to create jobs and economic growth.

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WP-3 / # 09 * / EJ to EJ

R&D cooperation

The BRT calls on the EU and Japanese Authorities to:
Enhance strategic R&D cooperation in digital programmes of Horizon Europe and the
6th Science and Technology Basic Plan, and ensure these programmes leadinternational standardisation.

WP-3 / # 10 / EJ to EJ

Cooperation Towards Harmonised Deployment ofAutomated Driving (In joint proposal with WP1Regulatory Cooperation)

The BRT calls on the EU and Japanese Authorities to:Enhance cooperation to harmonize regulatory frameworks and roadmaps to deploy
automated and connected driving in a consistent and synchronized mannerContinue to lead efforts to create international standards and interoperability
frameworks in the domain of automated and connected driving

The BRT believes that:

European and Japanese Industry have the potential to be front-runners in
automated and connected driving which can create jobs and growth and bringinnovation to our roads, increasing road safety and making our transport system
more accessible.

In order for European and Japanese companies to invest in automated andconnected driving and bring solutions to the market it is necessary to have stable
legal certainty and predictable market conditions which are aligned andsynchronized.

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Aeronautics

WP-3/ # 11/ EJ to EJ

Government-Led Industrial Cooperation in
Aeronautics

The BRT calls on the EU and Japanese Authorities to:Establish a permanent dialogue aiming to significantly upgrade the scale of EUJapan industrial cooperation in aeronautics based upon mutual trust, equality andmutual benefits, and stimulated by government funding. This should include a
broad cooperation on environmental issues.

WP-3 / #12 / EJ to EJ

Cooperation in Aircraft Certification

The BRT calls on the EU and Japanese Authorities to:congratulate all parties for the signature on June 22, 2020 of the Bilateral Aviation
Safety Agreement (BASA) between the JCAB and the EASA.



focus on the role that airlines and aircraft will play in the recovery of the Japanese
economy once the borders reopen and Covid-19 is under control.

accelerate the discussion of the annexes linked to MRO and training.

WP-3 / # 13/ EJ to EJ

Cooperation on Navigation Regulations for
Helicopters

The BRT calls on the EU and Japanese Authorities to:Establish an increased level and better cooperation between Europe and Japan
regarding the development of low altitude IFR routes and satellite based navigation
regulations for helicopters.

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SpaceWP-3 / # 14/ EJ to EJ

Regulatory Cooperation in Space Operations

The BRT calls on the EU and Japanese Authorities to:Not lose the momentum and continue to cooperate closely on regulatory mattersin the space sector.

The BRT believes that:

Mutually open markets and cooperation are a possible opportunity for the EU andJapan to achieve their goals in space and for their industries to realize their fullpotential in the global market.
The EU-Japan Space policy Dialogue significantly promotes cooperation in Spaceand should thus continue on a regular basis.

WP-3 / # 15 / EJ to EJ

Technological and industrial cooperation on Japaneseand European next generation of launch vehicles

The BRT calls on the EU and Japanese Authorities to:Strengthen technological and industrial cooperation in the framework of thedevelopment of the products and services related to space sector including next
generation launch vehicles.

The BRT believes that:

There is a similarity regarding the environment surrounding Japanese andEuropean national launchers: Both have the responsibility vis-à-vis each
respective government to guarantee an independent access to space and due toinsufficient institutional demands, both have to be commercially competitive inorder to maintain a sufficient number of launches.



Due to the rapidly emerging new satellite applications, continuous improvements
are required for both the Japan and the EU in order to be competitive in thecommercial market. As a lot of similar hardware developments are required in such
improvements, Japan-EU cooperation is indispensable in quick and cost-effective
developments.

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Recommendations from
European industries
Space

WP-3 / # 16 / E to J

Mutual Backup of Government Satellite Launches

The BRT calls on the Japanese Authorities to:Bring about a mutual backup cooperation scheme of government launches using
Japanese and European launcher fleets.

The BRT believes that:

The International Space Station future automated cargo spacecraft HTV-X could
benefit from a back-up launch service aboard the future European Ariane 6 launchvehicle.

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