The Evolution of Japan's Legalism under the World Trade Organization. An analysis of Japan's activity in the WTO dispute settlement system since 2006.

Abstract

This text is a study about how the Japanese foreign trade law developed historically and not only under the scenery of the WTO but also with the growing interconnections built through bilateral agreements, which the government of Japan is still actively promoting. Even if Japan entered GATT in 1955, it is not since 1995, when Japan entered the newly established organization (WTO), that the country found itself in a new trade arena where it could understand how the legalization of trade relations is a fundamental element in affecting the state behavior. Being a good observer before and a good user later of the possibilities of law in the international confrontations, Japan appeared to be “aggressive”, as professor S.M. Pekkanen exhaustively described in her work Japan’s Aggressive Legalism, both as a respondent and as a complainant. Beginning from the work of professor Pekkanen this study wants to inspect how Japan is handling its international relations and disputes under the WTO in the recent years and wants to determine whether the use of legalism in a confrontational and aggressive way has changed over the years. Given the fact that, the belligerent behavior at the international level is quite often determined by the involvement of the most competitive industries in the disputes settlement processes, this text will start off by presenting broadly the economic scenery of Japan and the reasons that caused some industries to be more competitive than others. After this introduction, the work will examine the recent activity of Japan under the WTO dispute settlement system and what has changed in terms of interlocutors as a consequence of changes in the global trade interconnections. We will see that while Japan still holds an aggressive attitude in certain dispute settlements cases, particularly when concerning the globally competitive industries, for instance steel, automotive, electronics and technology, at the same time the litigation partners are slowly geographically moving towards East Asia. Therefore, while in the previous century Japan and the US had different trade frictions, in the recent years the trade relationship between the two countries has changed in a way that disputes are not anymore as common as before. On the other hand, we will see how Japan is involving always more in litigations with its neighbor countries and we will analyze specifically its relations with the Republic of Korea, with the People’s Republic of China and with India. Finally, since the work wants to discuss Japan’s legalistic behavior in the global trade framework, it is also important to point out the recent trends that push towards a more bilaterally interconnected scenery. Since the WTO seems to be always more outdated and always less in line with the times, especially in the latest years with the Appellate Body crisis, reforms started to be felt as a necessary action towards a better functioning of the system itself. Resulting not only from the DSU crisis but also from the growth of globalization in trade matters, the importance of bilateral agreements is growing and has become in the recent years a major theme of discussion among countries in order to not be cut out of the international trade system. Hence, the importance of discussing this matter in the final part of this work where we will see how Japan has become more and more entangled in this kind of agreements and if these newly established economic partnerships are giving their first results.