# UNITED STATESSECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

## FORM 10-K

[ X ] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2008

[     ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ______________ to ________________

Commission File Number: 000-32905

AMANASU ENVIRONMENT CORPRATION

(Exact name of registrant as specified in its charter)
| Nevada                                                         |   | 98-0347883                          |
|----------------------------------------------------------------|--------|-------------------------------------|
| (State of other jurisdiction of incorporation or organization) |   | (I.R.S. Eployer Identification No.) |

115 East 57th Street, 11th Floor New York, NY 10022

(Address of principal executive offices)

646-274-1274

(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:
| Title of each class |   | Name of each exchange on which registered |
|---------------------|--------|-------------------------------------------|
| COMMON STOCK        |   | OTC-BB                                    |

Securities registered pursuant to section 12(g) of the Act:

(Title of class)

(Title of class)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.
| Yes |   |   | No | X |
|-----|--------|--------|----|---|

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.
| Yes |   |   | No | X |
|-----|--------|--------|----|---|

                	Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the                    Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required                    to file such reports), and (2) has been subject to such filing requirements for the past 90 days.                
| Yes | X |   | No |   |
|-----|---|--------|----|--------|

				Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K(229.405 of this chapter)				is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements				incorporated by reference in Part III of this Form 10-K or any aadmendment to this Form 10-K.				
| Yes |   |   | No | X |
|-----|--------|--------|----|---|

                	Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller                    reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting copany" in                    Rule 12b-2 of the Exchange Act.                
| Large accelerated filer |   |                                          | Accelerated filer         |   |
|-------------------------|--------|-----------------------------------------------|---------------------------|--------|
| Non-accelerated filer   |   | (Do not check if a smaller reporting company) | Smaller reporting company | X      |

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
| Yes |   |   | No | X |
|-----|--------|--------|----|---|

##                 	APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PRECEDING FIVE YEARS:                

                	Indicate by check mark whether the registrant has filed all docments and reports required to be                	filed by sections 12, 13, or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution                    of securities under a plan confirmed by a court.                
| Yes |   |   | No |   |
|-----|--------|--------|----|--------|

##                 	APPLICABLE ONLY TO CORPORATE ISSUERS:                

                	Indicate the number of shares outstanding of each of the issuers                    classes of common stock, as of the latest practiable date: 44,000,816 as of March 31, 2009.                

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## 					AMANASU ENVIRONMENT CORPORATION					ANNUAL REPORT ON FORM 10-K					FOR FISCAL YEAR ENDED DECEMBER 31, 2008					TABLE OF CONTENTS				

| Reference | Section Name                                                                                                  | Page |
|-----------|---------------------------------------------------------------------------------------------------------------|------|
| PART I    |                                                                                                               |      |
| Item 1.   | Business                                                                                                      | 1    |
| Item 1A.  | Risk Factors                                                                                                  | 6    |
| Item 1B.  | Unresolved Staff Comments                                                                                     | 7    |
| Item 2.   | Properties                                                                                                    | 8    |
| Item 3.   | Legal Proceedings                                                                                             | 8    |
| Item 4.   | Submission of Matters to a Vote of Security Holders                                                           | 8    |
| PART II   |                                                                                                               |      |
| Item 5.   | Market for Registrant's Common Equity, Related Stockholder Matters, and Issuer Purchases of Equity Securities | 8    |
| Item 6.   | Selected Financial Data                                                                                       | 9    |
| Item 7.   | Management's Discussion and Analysis of Financial Condition and Results of Operations                         | 9    |
| Item 7A.  | Quantitative and Qualitative Disclosures about Market Risk                                                    | 10   |
| Item 8.   | Financial Statements and Supplementary Data                                                                   | 11   |
|           | Accountant's Audit Report                                                                                     | 11   |
|           | Consolidated Balance Sheets                                                                                   | 12   |
|           | Consolidated Statements of Operations                                                                         | 13   |
|           | Consolidated Statements of Changes in Stockholder's Equity                                                    | 14   |
|           | Consolidated Statements of Cash Flows                                                                         | 15   |
|           | Notes to Consolidated Financial Statements                                                                    | 16   |
| Item 9.   | Changes in and Disagreements with Accountants on Accounting and Financial Disclosure                          | 20   |
| Item 9A.  | Controls and Procedures                                                                                       | 20   |
| Item 9B.  | Other Information                                                                                             | 20   |
| PART III  |                                                                                                               |      |
| Item 10.  | Directors, Executive Officers and Corporate Governance                                                        | 21   |
| Item 11.  | Executive Compensation                                                                                        | 22   |
| Item 12.  | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters                | 22   |
| Item 13.  | Certain Relationships and Related Transactions, and Director Independence                                     | 23   |
| Item 14.  | Principal Accounting Fees and Services                                                                        | 24   |
| PART IV   |                                                                                                               |      |
| Item 15.  | Exhibits and Financial Statement Schedules                                                                    | 25   |
|           | Signatures                                                                                                    | 25   |

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# Part I

## Item 1. Business

### Current

The Company's current business plan is the result of recent operational results during the fiscal year of 2007 and may change due to the amount of risk accompanied by the nature of its business. The Company's business is run through four branches, with each respective branch focused on a particular environmental market: Amanasu Echo Frontier is involved in waste management technologies; Amanasu Energy, formerly Felice, is involved in solar panel technology; Amanasu Shinwa, formerly Shinwa Yosetsu, is involved in water purification; and finally as of September 21st 2006 a newly formed Amanasu Water which is involved in drinking water. All 4 branches are at various ownership levels managed through a 91% controlled holdings company, Amanasu Holdings established in December 2005.

The Company's principal offices are located at 115 East 57th Street 11th Floor New York, NY 10022, and its telephone number is (212) 939-7278. The Company also maintains an office at 1-3-38 Roppongi, Minatoku, Tokyo, 106-0032, Japan.

The Chairman and Chief Executive Officer Atsushi Maki, has set a goal to enter into the NASDAQ global market in 2 years time. The Company meets all requirements except one. The Company's main focus for the next 12 months will be to raise $30,000,000, and acquire public companies in both the United States and Japan.

**Echo Frontier**. Population growth, and ever decreasing land mass, have been key factors in the research and development of waste management methodologies. The primary technology used in many Asian countries today is the waste incinerator. Conventional incinerators, though effective in reducing the amount of space waste occupies, still leave environmentally harmful and unusable by-products. Amanasu Echo Frontier was established by Amanasu Environment and former employees of Kogure in December 2005 and is located at 1-24-8 Iwagami-cho, Maebashi, Gunma, Japan. Its operations consist of the sale and manufacturing of general and industrial waste incinerators, and medical waste treatment plants using the 6 proprietary technology rights purchased from Kogure. Its Rotary Kiln incineration system has two levels of waste processing that effectively reduce waste size in a cost effective manner. The ash by-product from the Rotary Kiln system can be further processed using Amanasu Echo Frontier's Swing Melter Incinerator. The Swing Melter's resulting residue which is primarily carbon pellets, can be recycled to be used for raw building materials involved in foundation construction due to the carbon pellets strong molecular structure.

**Energy**. Energy , formerly Felice, was renamed on September 21st 2006 as a subsidiary of Amanasu Holdings Corporation. As the name suggests, Energy is focused on technologies that produce energy through environmentally friendly means. The leading technology in this arena is the photovoltaic cell, or more commonly known as Solar panels. The Solar panel industry due to recent technological developments has never been more lucrative. With the recent advancements of residential unit powering modules, the demand of solar panels in the residential market will only continue to increase. With increased demand, costs of production have been reduced in recent years. The Company believes with the current market conditions, it is a good point in time to pursue the Solar power movement.

Sanyo is a world leader in Solar panel technology, with over 30 years of experience in the industry. Sanyo is regarded as one of the world's top Solar power technology provider. In 2003, Sanyo's 200W photovoltaic module proved to have the world's highest conversion efficiency marketed (cell conversion efficiency of 19.5% and module efficiency of 17.0%). Sanyo's HIT (Heterojunction with Intrinsic Thin layer) solar modules have more power generating capacity per area, and perform better at higher temperatures. We believe that Sanyo's product has the required elements for success in the residential market. Thus, Energy Development will be primarily involved in the sale of Sanyo's Solar panel product line on a commission basis in Japan.

**Amanasu Shinwa**. As of July 29th, 2008 the Company, and Amanasu Holdings Corporation sold its shares to Yoshiyuki Suzuki, Chief Executive Officer of Amanasu Shinwa, for the original investment of 20,000,000 Yen (10,000,000 Yen of which to the Company, and 10,000,000 Yen to Amanasu Holdings Corporation).

**Amanasu Water**. Amanasu Holdings Corporation, is currently negotiating an agreement to sell Amanasu Water Corporation to Amanasu Techno Holdings Corporation(Sister company to the Company). The Company expects an agreement to be reached by the end of the quarter ending June 30th, 2009.

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### History

Amanasu Environment Corporation ("Company") was incorporated in the State of Nevada on February 22, 1999 under the name of Forte International Inc. On March 27, 2001, the Company's name was changed to Amanasu Energy Corporation, and on November 13, 2002, its name was changed to Amanasu Environment Corporation.

It has acquired the exclusive, worldwide license rights to a high temperature furnace, a hot water boiler, and ring-tube desalination methodology. At this time, the Company is not engaged in the commercial sale of any of its licensed technologies. Its operations to date have been limited to acquiring the technologies, conducting limited product marketing, and testing the technologies for commercial sale. For each such technology, proto-type or demonstrational units have been constructed by each licensor or inventor of the technology. The Company has conducted various internal tests on these units to determine the commercial viability of the underlying technologies. As a result of such testing, the Company believes that the products are not commercially ready for sale, and that product refinements are necessary with respect to each of the technologies. In addition, the Company may seek joint venture or other affiliations with companies competitive in each respective product market whereby the Company can capitalize on the existing infrastructure of such other companies, such as product design and engineering, marketing and sales, and warranty and post-warranty service and repair. The Company believes that its marketing efforts to sell any of its products will be limited until such time as it can complete the refinements of its technologies. The Company can not predict whether it will be successful in developing commercial products, or establishing affiliations with any operating company.

On June 8, 2000, the Company obtained the exclusive, worldwide license to a technology that disposes of toxic and hazardous wastes through a proprietary, high temperature combustion system, known as the Amanasu Furnace. The rights were obtained pursuant to a license agreement with Masaichi Kikuchi, the inventor of the technology, for a period of 30 years. The Company issued 1,000,000 share of common stock to the inventor and 200,000 shares of common stock to a director of the inventor's company. Under the licensing agreement; the Company is required to pay the licensor a royalty of two percent of the gross receipts from the sale of products using the technology. If the Company fails to comply with any provision of the agreement after a 90-day notice period, the licensor may terminate the agreement.

Effective September 30, 2002, the Company obtained the exclusive, worldwide license to a hot water boiler technology that incinerates waste tires in a safe and non-polluting manner and extracts heat energy from the incineration process. The rights were obtained pursuant to a license agreement with Sanyo Kogyo Kabushiki Gaisha and Ever Green Planet Corporation, both Japanese companies, for a period of 30 years. As consideration for this acquisition, the Company paid the licensors $250,000, of which the Company's President paid $95,000, issued to them 600,000 shares of common stock, and issued to an affiliate of the licensors 50,000 shares of common stock. The licensors are entitled to receive a two percent royalty on the gross receipts from the sale of the products related to the technology. If the Company fails to comply with any provision of the agreement after a 90-day notice period, the licensor may terminate the agreement.

On June 30, 2003, the Company acquired the exclusive worldwide rights to produce and market a patented technology that purifies seawater, and removes hazardous pollutants from wastewater. The rights were obtained pursuant to a license agreement with Etsuro Sakagami, the inventor, for a period of 30 years. As consideration for obtaining the license, the Company issued 1,000,000 shares to the inventor, and 50,000 shares to a finder. The licensor is entitled to receive a two percent royalty on the gross receipts from the sale of the products related to the technology. If the Company fails to comply with any provision of the agreement after a 90-day notice period, the licensor may terminate the agreement.

### Products

#### Amanasu Environment

Amanasu Furnace

                    The technology, known as the Amanasu Furnace, is a process that disposes of toxic                    and hazardous waste, through a proprietary, high temperature combustion system.                    The combustion system is a low cost methodology generating extremely high                    temperatures in excess of 2,000 Celsius. Waste matter exposed to the extreme                    temperature system is instantly decomposed to a gaseous matter and a magna-like                    liquid. The process leaves a 1-2% residue of an inert, carbon substance and                    oxygen which is vented out of the system. The process produces no toxins, smoke,                    ash, or soot.                

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                    The Company believed that the prior pricing structure for its furnaces                    was not competitive, and was seeking ways to lower its manufacturing                    costs. The Company was attempting                    to locate alternate suppliers that were more cost effective than currently identified                    ones. At the same time the Company also attempted to re-design certain components of the furnace                    so as to reduce the manufacturing cost per component. The aim was to                    alter the function of the original furnace, which managed daily waste to one that managed                    specific waste (i.e. industrial, and/or medical waste); however, the Company was confronted                    with several difficulties and started to reconsider the alteration.                    At the same time, the Company was also seeking affiliations with companies competitive in the furnace market in Japan.                    Kogure Works, had an established infrastructure, manufacturing more developed furnaces, comparatively lower in cost.                

                    The Company then entered into an agreement with Kogure Works Co sharing its technologies and marketing resources,                    while making use of Kogure's manufacturing expertise.                    The pricing of the product to be developed was $100,000/t and eventually reducing the price by 20% was ideal.                

                    As discussed above, the Company expected to alter the function of the Amanasu                    Furnace in order to specify its market place; however, there has not been                    a strong demand for their product due to the cost of manufacturing a unit.                    The Company did not reach the successful and                    complete refinement and cost reduction as they had planned; therefore,                    no further production and investment on this technology has been determined,                    and there is no further business relation with Kogure Works Co., Ltd. ("Kogure")                    on this project. The Company does not know whether the project will continue into the future;                    however, the exclusive rights of manufacturing and sales of the Amanasu Furnace will remain with the Company.                

Fire Bird Boiler

                    The Fire Bird Boiler technology is a patented process, which incinerates                    whole waste tires in a non-polluting manner emitting heat or steam in the                    incineration process.  The Fire Bird Boiler provides combustion efficiency                    and seeks to minimize dioxin generation which is generally a by-product of                    imperfect combustion.                

                    The Company believes that the Fire Bird Boiler is an effective dual purpose technology                    for incinerating waste tires and generating heat; however, the Company                    has recognized that the supply of waste tires in certain markets, including the                    United States, has been greatly reduced due to the effect of recent efforts to recycle                    waste tires. Thus, the reduction in the available supply of waste tires in these markets                    has limited the market potential of the boiler. As a result, the Company has been                    confronted with severe marketing difficulties for Fire Bird at present, and will seek                    to refine the boiler to accept other forms of waste, such as hazardous waste.                

                    Even though the Company decided to seek refinement to the boiler to accept other                    forms of waste, to be flexible in the market,                    the Company has determined no further production and/or investment on this                    technology. The estimated refinement time was not feasible for the Company, thus                    no further business relations will continue with Kogure on this project. The                    Company does not know whether the project will continue into the future; however,                    the exclusive rights of manufacturing and sales for the Fire Bird Boiler will                    still remain with the Company.                

Ring-tube Desalinization Equipment

                    The Ring-Tube technology is used as a filter to purify seawater into drinking                    water and also treats sewage and waste water, by removing pollutants and bacteria.                    The equipment filters bacteria and other impurities through its fine rings                    and comb type filter and reduces the presence of inhibiting scales on the                    equipment.  The impurities are then destroyed by the high pressure and                    temperature in the ring-tube.  The Company believes that its technology is                    more cost efficient to construct and operate than conventional RO equipment.                    Its fresh water recovery rate is 95% compared with the less than 40% for a RO method.                    Moreover, water produced from the Company's technology retains a certain                    amount of salt and minerals and does not required a pH adjustment. RO filtration                    removes all minerals and salt, requiring minerals to be added to improve flavor,                    and an adjustment to reduce pH levels.  The reject brine resulting from RO                    filtration is discharged in the ocean creating higher salt concentrations in                    such areas, however, the by-product from the Company's  technology is sufficiently                    condensed allowing it to be sold as a salt product.                

                    The Company believes that the existing capacity of the Ring-Tube Desalination                    equipment is commercially insufficient for its targeted markets because                    the equipment is hand-manufactured, which leads to high cost production.                    There are many similar production companies, which promote water                    purification systems in Japan therefore reducing the cost of manufacturing                    is the key to succeed in the competitive market.  Consequently, the Company                    entered into an agreement with Shinwa Yosetsu, a subcontract manufacturing                    company which could manage Sakagami's technology under instructions to lower production cost.    			

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                    With the acquisition of Shinwa Yosetsu, Amanasu Shinwa now has furnace technology,                    as well as maintenance management businesses and welding businesses, and                    maintain the top level of operation in Japan. With current developments the                    Company has decided to discontinue the Ring-Tube Desalination project, and                    in 2006, the Company will focus only on producing and marketing water                    purification systems and seawater desalination systems utilizing and                    employing new technologies under the management of Amanasu Shinwa.				
Echo Frontier
Rotary Kiln

                    Echo Frontier's Rotary Kiln is an environmentally friendly general and industrial waste incineration system.                    They system has an advanced                    General or industrial waste is first shred and crushed into smaller pieces and piled in a waste pit.                    A ceiling crane then loads the dry waste onto a conveyer, where it is delivered into the Rotary Kiln injector device.                    The injector device contains two parts: Injector screw and injector shoot. These two devices protect the Rotary Kiln                    burn chamber from outside temperature influence, and also prevents gas reflux from the Rotary Kiln chamber itself.                    The injector device is also protected by a cooling jacket to regulate the extreme temperature effects of the Rotary Kiln.                    The shredded and crushed waste is then injected into the Rotary Kiln burn chamber where it is incinerated at 1400 C.                    The Rotary Kiln rotates to better distribute and equalize the incineration process. The Rotary Kiln itself has a                    patented coating in its interior to shield it from the extreme temperatures. After the initial incineration process,                    the waste is delivered into a second burn chamber tower, where further incineration is done. The remaining ash                    is cooled to 180 C in a cooling tower and dioxins, and carbon monoxide are filtered and the remaining smoke                    is released through a smoke stack. The resulting ash is 1/10 of its original volume and can be further processed                    with the Swing Melter to be used as an ingredient for construction materials. The entire Rotary Kiln system has an					advanced cooling system that makes it possible to run 24 hours a day. Besides the initial shredding process,					temperature regulation and waste delivery is almost entirely automated.				

Swing Melter

                    Echo Frontier's Swing Melter is a incineration system specifically for pre-incinerated ash, such as the                    resulting ash from the Rotary Kiln incineration system. Like the Rotary Kiln, the waste, in this case ash,                    is loaded and delivered via a conveyer to a grinding chamber, where the ash is reduced to less than 5 mm grains.                    While being delivered on another conveyer, the ground ash passes a magnet removing any metallic elements.                    The metal free ash is then lifted via a bucket elevator into another hopper and is then injected into                    the Swing melter burn chamber via an injector device similar to that of the Rotary Kiln. The ash is                    slowly injected over a period of 45 minutes in order to maintain the Swing Melter's internal temperature.                    The Swing Melter chamber constantly rotates from left to right to fully incinerate the injected ash.                    Because of this consistent 45 minute injection process, the cooling process is much more efficient,                    reducing the amount of damage to the Swing Melter, and thus reducing the amount of maintenance needed. The                    resulting by-product is molecularly strong carbon pellets which can be recycled to be used as an ingredient                    in concrete and foundational construction. The Swing Melter system hourly capacity is 150 kg/hour making its daily                    capacity 50 t /day.            	
Energy Development
Sanyo HIT (Heterojunction with Intrinsic Thin Layer) Photovoltaic Panel

                    Energy Development will place its efforts in marketing in Japan the industry leading HIT solar panel by Sanyo.                    HIT solar cells are composed of thin mono-crystalline silicon wafers, surrounded by ultra-thin                    amorphous silicon layers. The proprietary solar cell configuration by Sanyo is said to improve                    boundary characteristics and reduce power generation losses. The HIT solar panel has the highest                    module efficiency (17%) in the world, even at higher temperatures effectively giving the consumer                    more energy conversion per unit area. Sanyo has also made its HIT solar panels pre-equipped                    with plug-n-play connectors, touch safe junction boxes, and other features that make installation                    and maintenance relatively simple. The HIT solar panels are subjected to strict inspections and                    maintain top industry standards, which is why Sanyo backs its product by a 20 year power out-put warranty,                    and a 2 year workmanship warranty.                

                    Sanyo also provides customers with a user friendly 3 piece system, which regulates energy generated.                    The HIT solar panels first collects energy from the sun, a 100% emission free process, which accumulate in                    an energy junction box. This junction box then transfers stored energy to power conditioners                    which regulate power throughout the house. The unused power is then stored in an energy reserve unit.                    later use, or the consumer has the option of selling the power                    back to power companies. All of the activities of the system can be easily monitored by a control panel                    directly connected to the power conditioners. The control panel features an EL-packlight illuminated                    viewing screen, which displays power generation statistics ,and reduction of greenhouse gas emissions values.				

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					The use of HIT solar panels saves the consumer a considerable amount of energy costs in the long run,					and also effectively reduces greenhouse gas emissions by 40%.				

                    Sanyo also provides customers with a user friendly 3 piece system, which regulates energy generated.                    The HIT solar panels first collects energy from the sun, a 100% emission free process, which accumulate in                    an energy junction box. This junction box then transfers stored energy to power conditioners                    which regulate power throughout the house. The unused power is then stored in an energy reserve unit.                    later use, or the consumer has the option of selling the power                    back to power companies. All of the activities of the system can be easily monitored by a control panel                    directly connected to the power conditioners. The control panel features an EL-packlight illuminated                    viewing screen, which displays power generation statistics ,and reduction of greenhouse gas emissions values.				

					The use of HIT solar panels saves the consumer a considerable amount of energy costs in the long run,					and also effectively reduces greenhouse gas emissions by 40%.				
Amanasu Water
Amanasu Hydrogen-ion Water (Sui-So-Sui)

                    Amanasu Water's principle product is a soon to be launched drinking water called "Sui-So-Sui",					or Hydrogen-ion water. Amanasu Hydrogen-ion water will be primarily marketed through					fitness clubs, and professional sports arenas, and pachinko parlors across Japan, with future plans to expand its operation					into North America. Processing and packing will be done by utilizing BMD Co,					facilities in Japan.				

					Hydrogen-ion water greatly reduces harmful activated oxygen ( free radicals ) in the  body system,					thus, maintaining healthy cells and cellular activity. The patented process dissolves large amounts					of hydrogen into the water and stabilizes it to create an oxidation reduction electric potential					of up to -500mv. The negative values indicate the potential for the reduction of free radicals caused					by oxidation.				

					Hydrogen-ion water has various applications apart from normal consumption. It can					be used as a hair tonic after showering, an eye rinse, and for other daily uses. Amanasu Hydrogen-ion Water					will be sold in 300 ml pouches starting November 2006.				

5
Table of ContentsItem 1A. Risk FactorsAbility To Develop Commercial Product
The Company presently maintains rights to three different technologies. At this time, proto-type versions of products for each of the three technologies have been developed, however, none of the products are commercially ready for sale. In order to reach a stage of commercial sales for the products, the Company prefers to put emphasis on joint venturing and funding a company who has advanced technological knowledge and progressed sales history of the same field for the purpose of cooperation. The Company can not predict that it will be successful in developing commercially ready products for any of the technologies in the near future or at any time.
Rapid Technological Changes
The industries in which the Company intends to compete with are subject to rapid technological changes. No assurances can be given that the technological advantages which may be enjoyed by the Company in respect of their technologies can not or will not be overcome by technological advances in the respective industries rendering the Company's technologies obsolete or non-competitive.
Lack of Indications Of Product Acceptability
The success of the Company will be dependent upon its ability to develop commercially acceptable products and to sell such products in quantities sufficient to yield profitable results. To date, the Company has received no indications of the commercial acceptability of any of its proposed products. Accordingly, the Company can not predict whether its products can be marketed and sold in a commercial manner.
Management
The ability of the Company to successfully conduct its business affairs will be dependent upon the capabilities and business acumen of current management including Mr. Atsushi Maki, the Company's President. Accordingly, shareholders must be willing to entrust all aspects of the business affairs of the Company to its current management. Further, the loss of any one of the Company's management team could have a material adverse impact on its continued operation.
Control Exercised By Management
As of March 15, 2006, the existing officers and directors, and affiliates will control approximately 78.80% of the shareholder votes. Consequently, management will control the vote on all matters brought before shareholders, and holders of common stock may have no power in corporate decisions usually brought before shareholders.
Conflicts of Interest
The officers of the Company are not full time employees. Presently, the Company does not have a formal conflicts of interest policy governing its officers and directors. In addition, the Company does not have written employment agreements with its officers. Its officers intend to devote sufficient business time and attention to the affairs of the Company to develop the Company's business in a prudent and business-like manner. However, the principal officer is engaged in other businesses related and unrelated to the business of the Company, and in the future, will engage in other business ventures. As a result, the principal officer and other officer of the Company may have a conflict of interest in allocating their respective time, services, and future resources, and in exercising independent business judgment with respect to their other businesses and that of the Company.
Reliance upon Third Parties
The Company does not intend on maintaining a significant technical staff nor does it intend on manufacturing its products. Rather it will rely heavily on consultants, contractors, and manufacturers to design, develop and manufacture its products. Accordingly, there is no assurance that such third parties will be available when needed at affordable prices.

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Table of ContentsCompetition
Although management believes its products, if developed, will have significant competitive advantages to other products in their respective industries, with respect to such products, the Company will be competing in industries, such as the industrial waste industry, where enormous competition exists. Competitors in these industries have greater financial, engineering and other resources than the Company. No assurances can be given that any advances or developments made by such companies will not supersede the competitive advantages of the Company's products.
Protection Of Intellectual Property
The success of the Company will be dependent, in part, upon the protection of its proprietary of its various technologies from competitive use. Certain of its technologies are the subject of various patents in varying jurisdictions (See " Description of Business - Proprietary Rights"). In addition to the patent applications, the Company relies on a combination of trade secrets, nondisclosure agreements and other contractual provisions to protect its intellectual property rights. Nevertheless, these measures may be inadequate to safeguard the Company's underlying technologies. If these measures do not protect the intellectual property rights, third parties could use the Company's technologies, and its ability to compete in the market would be reduced significantly. In addition, if the sale of the Company's product extends to foreign countries, the Company may not be able to effectively protect its intellectual property rights in such foreign countries.

In the future, the Company may be required to protect or enforce its patents and patent rights through patent litigation against third parties, such as infringement suits or interference proceedings. These lawsuits could be expensive, take significant time, and could divert management's attention from other business concerns. These actions could put the Company's patents at risk of being invalidated or interpreted narrowly, and any patent applications at risk of not issuing. In defense of any such action, these third parties may assert claims against the Company. The Company cannot provide any assurance that it will have sufficient funds to vigorously prosecute any patent litigation, that it will prevail in any of these suits, or that the damages or other remedies awarded, if any, will be commercially valuable. During the course of these suits, there may be public announcements of the results of hearings, motions and other interim proceedings or developments in the litigation, which could result in the negative perception by investors, which could cause the price of the Company's common stock to decline dramatically.
Indemnification of Officers and Directors for Securities Liabilities
The Company's By-Laws eliminates personal liability in accordance with the Nevada Revised Statutes (NRS). Section 78.7502 of the NRS provides that a corporation may eliminate personal liability of an officer or director to the corporation or its stockholders for breach of fiduciary duty as an officer or director provided that such indemnification is limited if such party acted in good faith and in a manner which he reasonably believed to be in or not opposed to the best interest of the corporation. In so far as indemnification for liability arising from the Securities Act of 1933 ("Act") may be permitted to directors, officers or persons controlling the Company, it has been informed that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable.
Penny Stock Regulation
The Company's common stock may be deemed a "penny stock" under federal securities laws. The Securities and Exchange Commission has adopted regulations that define a "penny stock" generally to be any equity security that has a market price of less than $5.00 per share, subject to certain exceptions. These regulations impose additional sales practice requirements on any broker/dealer who sell such securities to other than established investors and accredited investors. For transactions covered by this rule, the broker/dealer must make certain suitability determinations and must receive the purchaser's written consent prior to purchase. Additionally, any transaction may require the delivery prior to sale of a disclosure schedule prescribed by the Commission. Disclosure also is required to be made of commissions payable to the broker/dealer and the registered representative, as well as current quotations for the securities. Finally, monthly statements are required to be sent disclosing recent price information for the penny stock held in the account of the customers and information on the limited market in penny stocks. These requirements generally are considered restrictive to the purchase of such stocks, and may limit the market liquidity for such securities.
Item 1B. Unresolved Staff Comments
None.

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Table of ContentsItem 2. Properties
						The Company's executive offices are located at 115 East 57th Street 11th Floor New York, NY 10022 and Vancouver,						British Columbia. The total premises are 2,000 square feet and are subleased at a monthly rate of $2,500 under a						lease agreement which expires September 30, 2007. The Company shares the space with Amanasu Technologies Corporation,						a reporting company under the Securities Exchange Act of 1934.In addition, the Company maintains an office at 1-3-38						Roppongi, Minatoku, Tokyo, 106-0032, Japan. The premises are 1,000 square feet and are leased on an agreement which						expires December 31, 2006 at $1,700 (200,000 Yen) per month, and also an apartment at 1-3-40 Roppongi, Minatoku, Tokyo						at $10,000 (1,250,000 Yen) per month under a lease agreement which expires August, 2006. The Company believes additional						lease space at these locations will be available to support its future growth.					
Item 3. Legal Proceedings
None.
Item 4. Submission of Matters to a Vote of Security Holders
None.
Part IIItem 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
The Company's common stock has traded on the NASDAQ OTC Bulletin Board since October 2002 under the symbol "AMSU".

						The table below sets forth the high and low bid prices of the Common stock of the Company as reported by NASDAQ.						The quotations reflect inter-dealer prices, without retail mark-up, mark-down, or commissions and may not necessarily						represent actual transactions. There is an absence of an established trading market for the Company's common						stock, as the market is limited, sporadic and highly volatile. The absence of an active market may have an						effect upon the high and low priced as reported.					
Quarter EndedMar. 31Jun. 30Sep. 30Dec. 31YearFiscal Year 2008Common stock price per share:High$0.34$0.35$0.30$0.30$0.35Low$0.25$0.25$0.25$0.20$0.20Fiscal Year 2007Common stock price per shareHigh$0.08$0.15$0.10$0.75$0.75Low$0.08$0.08$0.10$0.13$0.08
8
Table of ContentsCompensation Plan InformationEquity Compensation Plan InformationPlan categoryNumber of securities to be issued upon exercise of outstanding options, warrants and rights(a)Weighted-average exercise price of outstanding options, warrants and rights (b)Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a))(c)Equity compensation plans approved by security holders (1)-0--0--0-Equity compensation plans not approved by security holders (2)-0--0--0-Total-0--0--0-
						During the quarter ended June 30, 2003, 20,000 shares were allotted to Reraise Corporation, a private Japanese						company, at a price of $4.99 per share for total consideration of $99,900. As of the date hereof, the shares						have not been issued due to pending documentation needed to affect a new share issuance. As a result, the $99,900						consideration received should be considered a liability, as opposed to a capital contribution, until the shares						have been issued. In July 2005, the Company made the repayment of the amount of $ 100,000 to Reraise Corporation						thus ending the Company's liability.					
Recent Sales Of Unregistered Securities - Deposits for Common Stock
						The most recent sale of unregistered securities was during the quarter ended June 30, 2003, 20,000						shares were allotted to Reraise Corporation, a private Japanese company, at a price of $4.99 per						share for total consideration of $99,900. In July 2005, the Company made the repayment of the amount						of $ 100,000 to Reraise and completed the liability.					
Private Placement
						During the 2005 fiscal year, the Company issued 1,000,000 shares of common stock, realizing cash						proceeds of $3,500,000. These sales were exempt under Regulation S under the Securities Act of 1933,						as amended, due to the foreign nationality of the relevant purchasers.					
Item 6. Selected Financial Data
Not Applicable.
Item 7. Management's Discussion and Analysis of Financial Condition and Results of OperationsPlan Of OperationsAmanasu Environment Corporation
The Company main objective for the fiscal year ending December 31, 2008 has been to attain capital in the amount of $30,000,000 in order to prepare the Company to enter into the NASDAQ Global Market. In order to meet this objective the Company has decided to move a lot of its focus into other technologies besides the ones that it currently manages, and as a result will be putting up for sale share of companies currently in its posession. No more funds will be put into the operations of BJSS, Amanasu Energy, Petstyle, Amanasu Eco Frontier, and Amanasu Project Support. Amanasu Shinwa Corporation's shares have been bought back by Amanasu Shinwa Management, and the original capital put into Amanasu Shinwa by Amanasu Environment (10,000,000 Yen), and Amanasu Holdings (10,000,000 Yen) will be paid back. The Company will be focusing its resources on attaining manufacturing and sales rights to three new technologies:

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Table of Contents
1) A Hydrogen extraction process, currently being developed by a Japanese company, that requires only water, and a patented catalyst. This technology is far more efficient, and cost effective than current electrolysis, and bacteria based processes. 2) A Styrofoam recycling process that takes styrofoam into a liquid state without heat, for reprocessing back into Styrofoam or other materials. and 3) a small in home/kitchen odourless composting technology.

The Company believes that attaining the manufacturing and sales rights of these technologies is key in generating its capital objective.
Amanasu Holdings CorporationWith the Company moving in new direction, Amanasu Holdings Corporation is facilitating the sale of BJSS, Amanasu Energy, Petstyle, Amanasu Eco Frontier, and Amanasu Project Support. While finding buyers, Amanasu Holdings will also continue its management support of Amanasu Water, and also assist the Company in generating the $30,000,000 capital objective. To assist in attaining the capital objective, Amanasu Holdings continues to meet with prospective investors within Japan, aswell as China, and South Korea.					Results of Operations
The Company's sales for the fiscal year ended December 31, 2008 were $225,697 compared to $ 729,089 for the fiscal year ended December 31, 2007. The decrease is due to the the sale of Amanasu Shinwa Corporation, a primary source of sales for the Company, and reduced income from Amanasu Water Corporation

Interest income for the fiscal year ended December 31, 2008 was $28,682 compared to $55,280 for the same period in 2007. The decrease is due to the decreased amount of investment in Certificate of Deposits. The decrease in Certificate of Deposits is due to use of the funds for expenses.

Miscellaneous Revenue for the fiscal year ended December 31, 2008 was $4,502,compared to $11,531 for the same period in 2007. The decrease is due to the absense of Amanasu Shinwa Corporation, which was sold in the quarter ending September 30, 2008.

Total expenses for the fiscal year ended December 31, 2008 was $821,743 compared to $1,037,330 for the same period of 2007. The decrease is due primarily to the absense of Amanasu Shinwa Corporation, which was sold in the quarter ending September 30, 2008, as well as general expense reduction efforts.

Cost of goods sold for the fiscal year ended December 31, 2008 was $191,766 compared to $572,026 for the same period of 2007. The decrease is due to lower manufacturing operations from Amanasu Water Corporation.

During the year of 2005, the Company issued 1,000,000 shares of common stock, realizing cash proceeds of $3,500,000. These sales were exempt under Regulation S under the Securities Act of 1933, as amended, due to the foreign nationality of the relevant purchasers.

During the three months ended September 30, 2006 Soae, a Japanese electronics manufacturer, invested $426,014 into Amanasu Holdings in exchange for 4,000 shares of Amanasu Holdings.
Liquidity And Capital Resources					Other than the provision of alternating business planning costs discussed above under Plan of operation, the Company estimates that its operating overhead, which includes general and administrative charges, will be approximately $1,120,000 for the next 12 months. This amount is comprised of the following estimated costs; $375,000 in annual salaries for office personnel and consultants, $375,000 for rent, $150,000 for professional fees and $220,000 for miscellaneous expenses. The Company believes that the amount of liquidity and capital resources will be sufficient for the operation of the Company for the next 12 months. The Company has sufficient cash on hand to support its overhead for the next 12 months but no material commitments for capital at this time other than as described above. The Company and/or Amanasu Holdings will need to issue and sell shares to gain capital for operations.					OFF-BALANCE SHEET ARRANAGEMENTS
The Company has no off-balance sheet arrangements.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk
Not Applicable.

10
Table of ContentsItem 8. Financial Statements and Supplementary Data						AMANASU ENVIRONMENT CORPORATION						CONSOLIDATED FINANCIAL STATEMENTS						DECEMBER 31, 2008					Report of Independent Registered Public Accounting Firm
						Board of Directors						Amanasu Techno Holdings Corporation					

						I have audited the accompanying consolidated balance sheets of Amanasu Environment Corporation and						Subsidiaries as of December 31, 2008 and 2007 and the related consolidated statements of operations,						changes in stockholders' equity, and cash flows for the years ended December 31, 2008, and 2007.						These financial statements are the responsibility of the Company management. My responsibility is to						express an opinion on these financial statements based on my audit.					

						I conducted the audit in accordance with the standards of the Public Company Accounting Oversight Board (United States).						Those standards require that I plan and perform the audit to obtain reasonable assurance about whether the financial						statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the						amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used						and significant estimates made by management, as well as evaluating the overall financial statement presentation.						I believe that my audit provides a reasonable basis for my opinion.					

						In my opinion, the financial statements referred to above present fairly, in all material respects, the consolidated						financial position of Amanasu Environment Corporation and Subsidiaries as of December 31, 2008 and 2007 and the results						of its operations and its cash flows for the years ended December 31 , 2008 and 2007 in conformity with U.S.						generally accepted accounting principles.					

						/s/ Robert G. Jeffrey						ROBERT G. JEFFREY, Certified Public Accountants						April 14, 2009						Wayne, New Jersey					

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Table of Contents						AMANASU ENVIRONMENT CORPORATION and SUBSIDIARIES						CONSOLIDATED BALANCE SHEETS						December 31, 2008 and 2007					 December 31, 2008December 31, 2007AssetsCurrent Assets:Cash$7,583$18,293Certificate Of Deposit696,000771,000Accounts And Notes Receivables-76,672Raw Materials-556Advance To Vendor-94,000Accrued Interest Receivables-16,185Total Current Assets703,583976,716 Fixed Assets:Machinery and equipment25,859263,681Less, accumulated depreciation19,785132,512Net fixed assets6,074131,169 Other Assets:Investments92,604290,875Prepaid Expenses-72,222Security Deposits-21,835Miscellaneous Receivables88,724175,501Employee Advances-44,504   Total Other Assets181,328604,937 Total Assets890,9851,712,822 LIABILITIES AND STOCKHOLDERS' EQUITY Current Liabilities:Accounts Payable$45,762$24,520Accrued Expenses6,77591,685Payroll And Other Taxes Payable8,54726,109Short-Term Loans24,34124,033   Total Current Liabilities85,425166,347 Bank Loan Payable-84,548Minority Interest36929,243 Stockholders' Equity:Common Stock: authorized 100,000,000 shares of .001 par value; 44,000,816 issued and outstanding44,00144,001Additional Paid In Capital4,634,2234,634,223Retained Deficit(3,927,583)(3,298,967)Other comprehensive income54,55053,427 Total stockholders' equity805,1911,432,684   Total Liabilities and Stockholders' Equity$890,985$1,712,822 The accompanying notes are an integral part of these financial statements.
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Table of Contents						AMANASU ENVIRONMENT CORPORATION and SUBSIDIARIES						CONSOLIDATED STATEMENTS OF OPERATIONS AND DEFICIT						ACCUMULATED DURING DEVELOPMENT STAGE						For the Years Ended December 31, 2008 and 2007					Year 2008Year 2007Sales$225,697$729,089Cost of Goods Sold191,766572,026 Gross Profit33,931157,063 Expenses675,755695,486Impairment Of Fixed Assets66,285-Impairment Of Investments79,703121,844Legal Settlement-220,000Total Expenses821,7431,037,330Operating Loss(787,812)(880,267) Other Income (Expense):Interest Income28,68255,280Profit On Sale Of Subsidy99,509-Miscellaneous Revenue4,50211,531Interest Expense(2,371)(6,782)Net Other Income130,32260,029 Net Loss, Before Minority Interest(657,490)(820,238)Minority Interest In Loss28,87419,587Net Loss(628,616)(800,651) Other Comprehensive IncomeGain on foreign exchange conversion30,82437,938Total Comprehensive Income$(597,792)$(762,713) Net loss per share - basic and diluted$(.01)$(.02) Average Number Of Shares Outstanding44,001,81644,001,816 The accompanying notes are an integral part of these financial statements.
13
Table of Contents						AMANASU ENVIRONMENT CORPORATION and SUBSIDIARIES						CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY 						For the Years Ended December 31, 2008, and 2007					Common StockAdditional Paid In CapitalRetained DeficitOther Comprehensive IncomeTotalSharesAmountBalance December 31, 200644,020,816$44,001$4,634,223$(2,498,316)$15,489$2,195,397 Net loss For Period---(800,651)-(800,651) Comprehensive Income----37,93837,938Balance December 31, 200744,000,81644,0014,634,223(3,298,967)53,4271,432,684 Net Loss For Period---(628,616)-(628,616) Transfer upon sale of subsidy----(29,701)(29,701) Comprehensive Income----30,82430,824 Balance December 31, 200844,000,816$44,001$4,634,223$(3,927,583)$54,550$805,191 The accompanying notes are an integral part of these financial statements.
14
Table of Contents						AMANASU ENVIRONMENT CORPOR ATION and SUBSIDIARIES						CONSOLIDATED STATEMENTS OF CASH FLOWS						For The Years Ended December 31, 2008 AND 2007					Year 2008Year 2007CASH FLOWS FROM OPERATIONS:Net loss$(628,616)$(800,651)Adjustments to reconcile net loss to net cash consumed by operating activities:Charges and credits not involving use of cash:Depreciation and amortization39,13860,030Write down of machinery66,28572,000Write down of investments85,785-Write offs of bad debts211,594-Equity in losses of investee companies-101,169Minority interests in losses(28,874)(19,587)Profit on sale of subsidiary(99,509)- Change in current assets and liabilities:Decrease (increase) in notes and accounts receivable76,672(9,935)Decrease in loans receivables-41,978Increase in short term bank loan-23,075Decrease in accrued interest-(2,949)Decrease in prepaid expenses69,1154,226Decrease in raw materials5662,807Increase accounts payable21,2422,161Increase (decrease)  in payroll and other taxes payable(17,562)8,027Increase (decrease) in accrued expenses(84,910)78,235Increase in employee loans-(23,021)Net Cash Consumed By Operating Activities(289,074)(444,435) CASH FLOWS FROM INVESTING ACTIVITIESRedemptions of certificates of deposit75,000371,000Cash received on sale of subsidiary148,898- Net Cash Provided By Investing Activities223,898371,000 CASH FLOWS FROM FINANCING ACTIVITIESBank borrowings-84,548Advances from affiliate23,6424,450 Net Cash Provided By Financing Activities23,64288,998 Exchange Rate Effect on Cash30,82437,548Net Change in Cash Balances(10,710)(84,470)Cash Balance, beginning of period18,293102,763 Cash balance, end of period$7,583$18,293The accompanying notes are an integral part of these financial statements.
15
Table of Contents						AMANASU ENVIRONMENT CORPORATION and SUBSIDIARIES						NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 						DECEMBER 31, 2008					1. ORGANIZATION AND BUSINESSOrganization of Company
The Company is a Nevada Corporation, formed February 22, 1999, as Forte International, Inc. The name was changed to Amanasu Energy Corporation on March 27, 2001, and to Amanasu Environment Corporation on October 18, 2002. 
Business
On October 19, 2004, the Company invested $100,000 for a 100% interest in a newly formed subsidiary, Amanasu Shinwa Corporation (Shinwa), which is located in Gunma, Japan. On December 16, 2005, a second 100% owned subsidiary was formed, Amanasu Holdings, Inc. (Holdings), which is located in Tokyo, Japan. Holdings made investments in five other Japanese companies during 2005, including an $84,288 investment in Shinwa. The investee companies were involved in a variety of businesses. Shinwa performs fabricating services, principally welding, on stainless steel piping; it has also developed, and continues development of systems for cleaning the waters of rivers, streams and lakes.

On September 21, 2006, Soae Corporation, a Japanese electronics manufacturer, invested $426,014 for a 9% interest in Holdings. Also, on September 21, 2006, Holdings formed another subsidiary, named Amanasu Water Corporation (Water). Water's plan of operation was to market a new type of water called "Hydrogen ion water". Hydrogen-ion water is believed to have effective anti-oxidant properties.

Investments in two of the five companies mentioned above remained on the books as of December 31, 2008.  Investments in the others have either been repaid, written off by the absorption of accumulated losses, or written off because of abandonment.  A corporation owned by the Company president has agreed to purchase the remaining two investments.

On July 1, 2008, the Company sold its equity interests in Shinwa to the president of Shinwa for cash.  On the same day, Holdings also sold its equity interests in Shinwa to the president of Shinwa for a cash payment of $56,655 and the right to collect a $37,780 debt that was owed to Shinwa by a corporation controlled by the Company president.  The Company realized a profit on there transactions of $99,509.

In March 2005, the Company made a $290,000 equity investment in Kogure Susakusho Ltd., (Kogure), a Japanese company which held patents for an industrial incinerator, called the Swing Melter. The original intention was that the Company would receive 20% of the profits on sales of the incinerator. In April 2005, the Company purchased, for $400,000, a demonstration model of the Swing Melter for use in attracting customers. Subsequently, Kogure ceased doing business and the Company exchanged its investment for the Kogure patents. In October 2005, a new company, now named Echo Frontier Corp., was formed by former employees of Kogure to produce the Swing Melter. On December 16, 2005, the Company made a $143,187 investment in the new company. In addition to its equity interest in the new company, the Company is to receive patent royalties on sales of the Swing Melter. During 2006, 2007, and 2008, the values of the investment and the demonstration model were reviewed and in each case impairment was found to have occurred, and write downs were made.  The remaining balances of these investments were written off in 2008.
Basis of Consolidation
The consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries; the operating results of Shinwa are included up to the date of its sale.  All significant intercompany balances and transactions have been eliminated in consolidation.					The equity interest in each of the five investee companies mentioned above is not more than 50% and the companies are not consolidated in these financial statements; they are accounted for by the equity method of accounting.

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Table of Contents2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIESCash
For purposes of the statements of cash flows, the Company considers all short term debt securities purchased with a maturity of three months or less to be cash equivalents.
Concentrations of Credit Risk
Financial instruments which potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents, miscellaneous receivables, and miscellaneous payables. The Company does not believe that it is subject to unusual credit risk beyond the normal credit risk associated with commercial banking relationships.
Fixed Assets
Fixed assets are recorded at cost. Depreciation is computed using accelerated methods, with lives of five years for vehicles, and seven years for machinery and equipment, ten years for tools, and fifteen years for building improvements.
Income Taxes
Deferred income taxes are recorded to reflect the tax consequences or benefits to future years of any temporary differences between the tax bases and the book values of assets and liabilities, and of net operating loss carryforwards.
Recognition Of Revenue
Revenue is realized from sales of products and services. Recognition occurs upon delivery. In determining recognition, the following criteria are considered: persuasive evidence exists that there is an arrangement between the buyer and seller; delivery has occurred; the sales price is fixed or determinable; and collectability is reasonably assured.
Use Of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect certain reported amounts and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimated.
Foreign Currency Translation
Substantial Company assets are located in Japan. These assets and related liabilities are recorded on the books of the Company in the currency of Japan (Yen), which is the functional currency.  They are translated into US dollars as follows: 

a.	Assets and liabilities at the rate of exchange in effect at the balance sheet date;					b.	Equity accounts at the exchange rates prevailing at the time of the transactions that established the equity accounts; And					c.	Revenues and expenses, at the average rate of exchange for the year.					
Other Comprehensive Income
The Company reports as other comprehensive income revenues, expenses, and gains and losses that are not included in the determination of net income. Principal among these has been unrealized gains and losses from exchange rate fluxuation.
Advertising Costs
The Company will expense advertising costs when an advertisement occurs. Amounts expensed were $1,535 during 2007, and nothing in 2008.

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Table of ContentsSegment Reporting
Management treats the operations of the Company as one segment.
Fair Value of Financial Instruments
The carrying amounts of the Company's financial instruments, which include cash and cash equivalents, approximate their fair values at December 31, 2008.
Net Income (Loss) Per Share
The Company computes net income (loss) per common share in accordance with SFAS No. 128, "Earnings Per Share" and SEC Staff Accounting Bulletin No. 98 ("SAB 98"). Under the provisions of SFAS No. 128 and SAB 98, basic and diluted net income (loss) per common share are computed by dividing the net income (loss) available to common shareholders for the period by the weighted average number of shares of common stock outstanding during the period. Accordingly, the number of weighted average shares outstanding as well as the amount of net income (loss) per share are presented for basic and diluted per share calculations for all periods reflected in the accompanying consolidated financial statements.
Recent Accounting Pronouncements
The Company does not anticipate the adoption of recently issued accounting pronouncement to have a significant effect on the Company's results of operations, financial position or cash flows.
3. RELATED PARTY TRANSACTIONS
A corporation controlled by the Company president (Affiliate) has agreed to buy from the Company its investment in two Japanese companies (see Note 1).  The purchase prices would be equal to the original investments.

Affiliate made advances to the Company of $1,106 during 2007 and $4,426 during 2008.  Part of the proceeds of the sale of Shinwa (see Note 1) was the right to collect a $44,256 advance that had been made to Affiliate by Shinwa.  Thus, at December 31, 2008, Affiliate was indebted to the Company for $38,724.  These advances are due on demand and do not bear interest.

Affiliate also made advances to Water of $6,638 during 2007 and $17,703 during 2008.  Thus, $24,341 was owed to Affiliate by Water at December 31, 2008.  These advances are due on demand and do not bear interest.

The Company shares office space in Vancouver, New York, and Tokyo with a company that is controlled by the Company president.  This arrangement is on a month to month basis.  Until 2006, the two companies shared the cost of operating these offices.  There has been no cost sharing since 2006, as the other company is largely inactive.

The president of Shinwa and two of his sons received advances from Shinwa totaling $44,504. These advances did not bear interest and were being repaid by monthly installments of $1,259.  These advances were eliminated with the sales of the equity interests in Shinwa.
4. PROVISION FOR DOUBTFUL ACCOUNTS
The December 31, 2007 balance of notes and accounts receivable had been reduced by a provision for doubtful accounts in the amount of $1,449.  No such provision was applicable at December 31, 2008.

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Table of Contents5. INCOME TAXES
The Company has experienced losses since inception. As a result, it has incurred no Federal income tax. The Japanese Tax Code allows net operating losses (NOL's) to be carried forward and applied against future profits for a period of seven years. The total of these NOL's at December 31, 2008 was $1,288,279. The potential benefit of these NOL's has been recognized on the books of the Company, but it has been offset by a valuation allowance.

Under Statement of Financial Accounting Standards No. 109, recognition of deferred tax assets is permitted unless it is more likely than not that the assets will not be realized. The Company has recorded noncurrent deferred tax assets as presented below. These deferred tax assets increased during 2008 by $73,052, the results of adding the potential benefit of 2008 losses. 
Deferred Tax Assets$386,484Valuation Allowance386,484Balance Recognized$-
If not used, these carryforwards will expire as follows:
2012$302,9112013$454,3662014$240,8052015$290,1976. RENTALS UNDER OPERATING LEASES
The Company conducts its operations from leased office facilities in Vancouver, British Columbia, New York City, and Tokyo, under month to month arrangements. During 2008 and 2007, the Company incurred rent expense of $38,731 and $40,214, respectively.
7. SUPPLEMENTAL DISCLOSURES OF CASH FLOWS INFORMATION
Cash payments were made for interest during 2008 and 2007 of $2,371 and $6,782, respectively.  There was no cash paid for income taxes during those years. There was no non-cash financing or investing activity during these years.
8. CONTINGENCY
On February 10, 2006, a law suit was commenced in which the Company, an affiliated company, and an officer of the Company were named as defendants. The lawsuit was subsequently settled o n March 27, 2007 and $220,000 was paid by the Company.
9. SUBSEQUENT EVENTS
In February 2009, Holdings entered into a contract to sell 100% of the capital stock of Water to Amanasu Techno Holdings, Inc. (Techno), a company which is controlled by the Company president.  Consideration for this sale is to be 200,000 shares of the common stock of Techno.  The Company expects a closing of this transaction during April 2009.

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Table of ContentsItem 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure
None.
Item 9A. Controls and Procedures
						As of the end of the period covered by this Annual Report on Form 10-K, an evaluation was performed under the						supervision and with the participation of our management, including the Chief Executive Officer and Chief						Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures						(as defined in Rules 13a-15 and 15d-15 of the Securities Exchange Act of 1934 ("Exchange Act").  For purposes						of the foregoing, the term disclosure controls and procedures means controls and other procedures of an issuer						that are designed to ensure that information required to be disclosed by the issuer in the reports that it files						or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods						specified in the rules and forms of the Securities and Exchange Commission ("SEC").  Disclosure controls and						procedures include, without limitation, controls and procedures designed to ensure that information required						to be disclosed by an issuer in the reports that it files or submits under the Exchange Act is accumulated and						communicated to the issuer's management, including its principal executive and principal financial officer,						or persons performing similar functions, and is appropriate to allow timely decisions regarding required disclosure.						Based on that evaluation, the Chief Executive Officer and Chief Financial Officer have concluded that these disclosure						controls and procedures are effective.					
Changes in Internal Control over Financial Reporting
						There were no changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f)						of the Exchange Act) during the most recent fiscal quarter that have materially affected, or are reasonably likely to materially						affect, our internal control over financial reporting.					
Management's Annual Report on Internal Control over Financial Reporting
						Management is responsible for establishing and maintaining adequate internal control over financial reporting,						as such term is defined in Rule 13a-15 under the Exchange Act, as amended.  As of December 31, 2007, under the						supervision and with the participation of management, including the Company's Chief Executive Officer and Chief						Financial Officer, an evaluation was conducted of the effectiveness of the Company's internal control over						financial reporting based on the framework in Internal Control - Integrated Framework issued by the Committee						of Sponsoring Organizations of the Treadway Commission (COSO).  Based on that evaluation, management of the						Company, including the chief executive officer and the chief financial officer, concluded that the Company's						internal control over financial reporting was effective as of December 31, 2008.					

						Because of its inherent limitations, a system of internal control over financial reporting can provide only						reasonable assurance and may not prevent or detect misstatements.  Also, projections of any evaluation of						effectiveness to future periods are subject to the risk that controls may become inadequate because of changes						in conditions, or that the degree of compliance with the policies or procedures may deteriorate.					

						This Annual Report does not include an attestation report of the Company's registered public accounting firm						regarding internal controls over financial reporting.  Management's Report was not subject to attestation by						the Company's public accounting firm pursuant to temporary rules of the SEC that permit the Company to provide						only Management's Report in this Annual Report.					
Item 9A (T). Controls and Procedures
Not Applicable.
Item 9B. Other Information
Not Applicable.

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Table of ContentsPart IIIItem 10. Directors, Executive Officers and Corporate Governance
                    The directors and executive officers of the Company, their ages, and the positions                    they hold are set forth below. The directors of the Company hold office until                    the next annual meeting of stockholders of the Company and until their                    successors in office are elected and qualified. All officers serve at the                    discretion of the Board of Directors.                
Directors / OfficersNameAgeSincePositionAtsushi Maki611999Chairman/Treasurer and PresidentLina Lei481999Secretary
                    Atsushi Maki has been                    the President, Chief Financial Officer, Chairman and Director of the Company                    since November 10, 1999. During the past ten years, Mr. Maki has been an                    independent businessman involved mainly in real estate development projects in                    Japan. In 1995, he served as a Director of the Japan-Korea Cooperation Committee                    along with the former Prime Minister of Japan who acted as the Chairman of the                    committee. In 1999, he was responsible for establishing the Japan-China                    Association, a foundation for fostering better relations between the two                    nations. He served as a director of the association, along with the Chairman of                    Sony Corporation and the Honorary Chairman of Toyota Motor Corporation.                

                    Lina Lei has been                    the Secretary of the Company since November 10, 1999. Ms. Lei was appointed a                    director in November 1999 and resigned from the board on August 21, 2002. From                    May 1990 to November 1999, Ms. Lei was employed by Thunder Company Ltd, Tokyo,                    Japan, in various capacities including as its managing director. Ms. Lei                    completed her university studies in Shanghai, China in 1982, and obtained a                    master's degree from Hitotsubashi University in Tokyo in 1990. During the past                    five years, Ms. Lei's work involvement has been limited to activities of the                    Company and that of Amanasu Technologies Corporation.                

                    Takashi Yamaguchi was a Director of the Company between October 1, 2001 and May 26,                    2004. From 1999 to June 2001, he was president of Daiichi Building Corporation,                    a construction company located in Tokyo, Japan, and form June 2001 to June 2002,                    he acted as a consultant for the same company. From June 2002 to the present,                    Mr. Yamaguchi has provided managerial consulting services to a variety of                    companies located in Japan, and he is an individual adviser of the Company at                    present.        		

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Table of ContentsItem 11. Executive Compensation
						The compensation for all directors and officers individually for services rendered to the						Company for the fiscal years ended December 31,2008, 2007, 2006, and 2005, respectively:					
Compensation Summary Annual CompensationName and Principle PositionYearSalary ($)Bonus ($)Other ($)Atsushi Maki (Chairman, President)2008-0--0--0- 2007-0--0--0- 2006-0--0--0- 2005-0--0--0-     Lina Lei (Secretary, Treasurer)2008-0--0--0- 2007-0--0--0- 2006-0--0--0- 2005-0--0-20,000
						(2). Ms. Lei received salary compensation in the form of 312,500 shares of common stock of the Company						for the period from November 1999 through fiscal 2001. The shares were valued at $0.01 per share. Of the						total amount of shares, 24,100 shares were allocated for fiscal 1999, with the balance allocated equally						between 2000 and 2001. In 2003, Ms. Lei received $10,000 in exchange for consulting services performed for the Company.					

						The officers of the Company are not full time employees. Presently, the Company does not have a formal						conflicts of interest policy governing its officers and directors. In addition, the Company does not have						written employment agreements with its officers. Its officers intend to devote sufficient business time						and attention to the affairs of the Company to develop the Company's business in a prudent and business-like						manner. However, the principal officer is engaged in other businesses related and unrelated to the business						of the Company, and in the future, will engage in other business ventures. A future arrangement will be						subject to the approval of the Company's board of directors. Except for the arrangement with Ms. Lei,						the Company and its officers have agreed that the officers of the Company will not receive any other						compensation until such time as the Company reaches profitability for a full fiscal quarter. The terms						of any such employment arrangement have not been determined at this time. Other than as indicated above,						the Company did not have any other form of compensation payable to its officers or directors, including						any stock option plans, stock appreciation rights, or long term incentive plan awards for the periods during the above fiscal years.					

						The Company's directors received no fees for their services in such capacity; however, they will be reimbursed						for expenses incurred by them in connection with the Company's business.					
Item 12. Security Ownership of Certain benficial Owners and Management and Related Stockholder Matters
						The following table will identify, as of March 15, 2006, the number and percentage of outstanding shares of						common stock of the Company owned by (i) each person known to the Company who owns more than five percent of						the outstanding common stock, (ii) each officer and director, and (iii) and officers and directors of the						Company as a group. The following information is based upon 44,000,816 shares of common stock of the Company						which are issued and outstanding as of March 15, 2006. The address for each individual below is 115 East 57th						Street 11 Floor New York, NY 10022, the address of the Company.					

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Table of ContentsTitle of SecurityName and Address of Beneficial OwnerAmount and Nature of Beneficial Ownership (1)Percent of ClassCommon StockAmanasu Corporation (2) #902 Ark Towers 1-3-40 Roppongi Minato-ku Tokyo Japan33,000,00072.6%Common StockAtsushi Maki (3) (4)35,858,50078.80%Common StockLina Lei (4)35,858,50078.80%Common StockOfficers and Directors, as a group (2 persons)35,858,50078.80%
						(1). "Beneficial ownership" means having or sharing, directly or indirectly (i) voting power, which includes the						power to vote or to direct the voting, or (ii) investment power, which includes the power to dispose or to direct						the disposition, of shares of the common stock of an issuer. The definition of beneficial ownership includes						shares underlying options or warrants to purchase common stock, or other securities convertible into common						stock, that currently are exercisable or convertible or that will become exercisable or convertible within						60 days. Unless otherwise indicated, the beneficial owner has sole voting and investment power.					

						(2). Mr. Atsushi Maki, the Company's Chairman and President, is the sole shareholder of Amanasu Corporation						and is deemed the beneficial owner of such shares.					

						(3). Includes 1,496,000 shares of common stock held individually by Mr. Maki, 1,000,000 shares of common						stock deposited with a third party (see "Item 12 "Certain Relationships and Related Transactions"), 33,000,000						shares of common stock held by Amanasu Corporation, and 362,500 shares of common stock held by						Lina Lei. Mr. Maki disclaims beneficial ownership of the shares held by Lina Lei.					

						(4). Includes 362,500 shares of common stock held individually by Ms. Lei, and 35,490,000 shares of						common stock beneficially owned by Atsushi Maki. Ms. Lei disclaims beneficial ownership						of the shares held by Atsushi Maki.					
Item 13. Certain Relationships and Related Transactions, and Director Independence
							On December 15, 1999, the Company entered into an agreement with Amanasu Corporation, a Japanese corporation,							under which Amanasu Corporation agreed to arrange a granting of a license to the Amanasu Furnace, to the Company.							In exchange for obtaining the license to the Technology, the Company agreed to issue Amanasu Corporation 13,000,000							shares of its common stock and stock purchase options to acquire another 20,000,000 shares of common stock at a							price per share of $0.01. In addition under the terms of the agreement, the Company agreed to issue 1,000,000							shares of common stock to the inventor of the technology, and 200,000 shares of common stock to the executive							director of the inventor's Company. In May 2001, Amanasu Corporation exercised its option to acquire 20,000,000							shares of common stock of the Company and paid the sum of $200,000 to the Company. Mr. Atsushi Maki, the							Company's Chairman and President, is the sole shareholder of Amanasu Corporation.						

							Mr. Maki received salary compensation in the form of 3,200,000 shares of common stock of the Company for the							period from November 1999 through fiscal 2001. The shares were valued at $0.01 per share or a total of $32,000.							Ms. Lei received salary compensation in the form of 312,500 shares of common stock of the Company for the period							from November 1999 through fiscal 2001. The shares were valued at $0.01 per share or a total of $3,125.						

							On June 8, 2000, the Company entered into an exclusive licensing agreement with the inventor of the							Amanasu Furnace. Under the licensing agreement, the Company obtained the worldwide production and marketing							rights of the Technology for 30 years, and the Company is required to pay the inventor a royalty of 2% on							gross sales of the Technology.						

							Effective September 30, 2002, the Company entered into a license agreement with Sanyo Kogyo Kabushiki Gaisha							and Ever Green Planet Corporation, both Japanese companies, whereby the Company received the worldwide,							exclusive license for a term of 30 years for the production and marketing of a hot water boiler, which							incinerates waste tires in a safe and non-polluting manner and extracts heat energy from the incineration							process. As consideration for this acquisition, the Company paid the licensors $250,000, of which the							Company's President paid $95,000, issued to them 600,000 shares of common stock, and issued to an affiliate							of the licensors 50,000 shares of common stock. The $95,000 paid by the Company's President is a contribution							of capital to the Company. The licensors are entitled to receive a two percent royalty on the gross receipts							from the sale of the products related to the technology.						

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							On June 30, 2003, the Company acquired the exclusive worldwide rights to produce and market a patented							process that purifies seawater, and removes hazardous pollutants from wastewater. The term of the license							is 30 years from the date of the agreement. As consideration for obtaining the license, the Company issued							1,000,000 shares to Etsuro Sakagami, the licensor, and 50,000 shares to a finder. The licensor is entitled							to receive a two percent royalty on the gross receipts from the sale of the products related to the technology.						

							On May 14, 2003, the Company entered into a Stock Purchase Agreement to acquire from Jipangu Inc. ("Jipangu"),							a private, unaffiliated Japanese company, 10,000,000 shares of Kyoei Reiki Industrial Corporation Ltd ("Kyoei"),							a publicly traded company in Tokyo, Japan. The purchase price for the shares is $4,993,000. The agreement							called for the payment of 20% of the purchase price on May 31, 2003, and the balance was due on June 25,							2003. On or about May 31, 2003, Atsushi Maki, the Company's President and controlling shareholder, deposited							with Jipangu 1,000,000 shares of common stock of the Company owned by Mr. Maki. However, the Stock Purchase							Agreement with Jipangu stated that if Kyoei becomes bankrupt or is under receivership for bankruptcy before							the remaining amount (80%) is due, Jipangu waives the right to collect the final amount. On June 25, 2003,							Kyoei was placed under receivership with Tokyo District Court. The Company believes that it is not required							to pay Jipangu the remaining amount due under the Stock Purchase Agreement. The deposit of common stock made							to Jipangu by Mr. Maki was made on behalf of the Company. On December 10, 2003, the Company transferred its							rights under the agreement with Jipangu to Mr. Maki, and Mr. Maki has released and indemnified the Company							from any obligation under the Jipangu agreement.						
Item 14. Principal Accounting Fees and Services- Audit Fees during 2008 and 2007 were $25,000.00 and $31,355.00 respectively.
- Audit Related Fees during 2008 and 2007 were $6,930.00 and $7,020.00 respectively.
- Caption Tax Fees during 2008 and 2007 were $690.00 and $675.00 respectively.
- All Other Fees during 2008 and 2007 were $-0- and $-0- respectively.
- N/A  							(i) Disclose the audit committee's pre-approval policies and procedures described in paragraph (c)(7)(i) of Rule 2-01 of Regulation S-X. (ii) Disclose the percentage of services described in each of Items 9(e)(2) through 9(e)(4) of Schedule 14A that were approved by the audit committee pursuant to paragraph (c)(7)(i)(C) of Rule 2-01 of Regulation S-X.
- Not greater than 50% for 2008 and 2007.  If greater than 50 percent, disclose the percentage of hours expended on the principal accountant's engagement to audit the registrant's financial statements for the most recent fiscal year that were attributed to work performed by persons other than the principal accountant's full-time, permanent employees.

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Table of ContentsPart IVItem 15. Exhibits Financial Statement Schedules- 							Financial Statements and Schedules  							The financial statements are set forth under Item 8 of this Annual Report on Form 10-K. Financial statement schedules have been omitted							since they are either not required, not applicable, or the information is otherwise included.						
- Exhibit Listing							   - 									3(i)(a)	Articles of Incorporation of the Company (Incorporated by reference to the Company's Form 10-SB filed on June 20, 2001).  3(i)(b)	Certificate of Amendment to Articles of Incorporation(Incorporated by reference to the Company's Form 10-SB filed on June 20, 2001).  3(i)(c)	Certificate of Amendment to Articles of Incorporation (Incorporated by reference to the Company's Form 10-KSB filed on March 31, 2003).  3(ii)(a)	Amended and Restated By - Laws of the Company (Incorporated by reference to the Company's Form 10-SB filed on June 20, 2001).  10(i)	Agreement between Family Corporation and the Company dated December 15, 1999. (Incorporated by reference to the Company's Form 10-SB filed on June 20, 2001).  10(ii)	License agreement between the Company and Masaichi Kikuchi dated June 8, 2000. (Incorporated by reference to the Company's Form 10-SB filed on June 20,2001).  10(iii)	Technical Consulting Agreement the Company and Masaichi Kikuchi dated June 9, 2001. (Incorporated by reference to the Company's Form 10-SB filed on June 20, 2001).  10(iv)	Amendment No. 1 to Licensing Agreement dated July 30, 2001, however, effective June 8, 2000 by and between the Company and Masaichi Kikuchi. (Incorporated by reference to the Company's Form 10-SB/A filed on August 9, 2001).  10(v)	License Agreement made as of September 30, 2002 by and between the Company and Sanyo Kogyo Kabushiki Gaisha and Ever Green Planet Corporation. (Incorporated by reference to the Company's Form 10-KSB filed on March 31, 2003).  10(vi)	Addendum to License Agreement made as of September 30, 2002 by and between the Company and Sanyo Kogyo Kabushiki Gaisha and Ever Green Planet Corporation. (Incorporated by reference to the Company's Form 10-KSB filed on March 31, 2003).  10(vii)	Stock Purchase Agreement dated May 14, 2003 by and between the Company and Jipangu, Inc.  10(viii)	Desalination License Agreement made as of May 30, 2003 by and between the Company Etsuro Sakagami. (Incorporated by reference to the Company's Form 10-QSB filed on August 13, 2003).  31 Certification under Section 906 of the Sarbanes-Oxley Act.  32 Certification under Section 906 of the Sarbanes-Oxley Act. 
Signatures
					In accordance with Section 13 or 15(d) of the Securities Exchange Act of 1934,					the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.				

					Amanasu Environment Corporation				

/s/ Atsushi Maki					April 13, 2009					President And Principal Accounting Officer				

					In accordance with the Exchange Act, this report has been signed below					by the following persons on behalf of the registrant and in the capacities					and on the dates indicated.				

/s/ Atsushi Maki

					April 13, 2009					Director				

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