Japanese Law and the Asia-Pacific

I am glad the High Court of Australia rejected today the argument by major tobacco companies that Australia’s plain packaging legislation is an unconstitutional “acquisition” of their rights. I dislike those companies’ products, their marketing and their litigation strategies, and I support the plain packaging legislation. I’ve also made numerous submissions to the Australian government since 2005 seeking to improve safety regulation for general consumer goods – partially achieved in the 2010 “Australian Consumer Law”.

But I hope that the ongoing arbitration claim of “expropriation”, initiated by Philip Morris Asia under the 1993 Hong Kong – Australia bilateral investment treaty, does not feed into blanket rejection of any forms of investor-state dispute settlement (ISDS) in investment treaties. Although that system has flaws, it also has benefits, and there is ample scope to draft treaties to provide clear and appropriate mechanisms to balancing private and public interests. With others familiar with international investment law, I provide further examples of the most promising substantive and procedural law reforms in an Open Letter dated 28 July 2012, in response to a recent OECD Public Consultation on ISDS.

My comment will therefore address points made recently on The Conversation blog by Dr Kyla Tienhaara, who remains completely opposed to any form of ISDS. In fact, she urges the Gillard Government to try to excise ISDS from all Australia's existing FTAs and investment treaties (dating back to 1988), in addition to eschewing them for future treaties – as the Government seems to be attempting, pursuant to its policy shift on ISDS announced in the 2011 Trade Policy Statement (TPS). An alternative is for the Government to approach Hong Kong authorities to seek agreement on amending the 1993 treaty to suspend PMA’s pending claim. More generally, Australia should consider including ISDS provisions in future treaties but expressly reserve its right to agree with the treaty partner to suspend particular types of claims, for example regarding public health issues. This compromise approach is already essentially found in investment treaty practice where the claim involves allegations of “expropriatory taxation”.

What does “Japan” evoke for you? Fine food, delicate design, pride in a long history and rich culture, powerful bureaucrats, some very big business? But it also has a sophisticated modern legal system, open to outside influences and impacting on other parts of the world – including Thailand, and more recently Cambodia and Vietnam. Just like France, in all these respects! To take the analogy even further: perhaps China is the “Germany of Asia” – now the slightly larger economy, with more focused politics, and a friendly rival for regional leadership.

On 20 August, Sydney Law School (SLS) will hold a student information session on legal practice and educational opportunities in Asia, kindly sponsored this year by “Herbert Smith Freehills”. Offshore units available for SLS course credit include the Kyoto and Tokyo Seminars in Japanese Law, co-taught by Australian- and Japan-based professors and practitioners, every February for Australian, other international and Ritsumeikan University Law School students. I also want to talk briefly about practice opportunities in Japan, based on my personal experience (as a “trainee” with Osaka law firms in the early 90s, while a postgraduate student at Kyoto University) and especially an excellent introduction to “finding legal work in Japan” written a few years ago by a SLS student (“Anon”, still living in Tokyo).