UK and Japan sign new free trade agreement

The new UK-Japan Comprehensive Economic Partnership Agreement (CEPA) marks a positive step in trade relations between the UK and Japan, the Law Society told the House of Lords EU International Agreements Sub-Committee.

The agreement, signed by the UK’s international trade secretary Liz Truss and her Japanese counterpart Hiroshi Matsuura on 23 October 2020, will enable the free flow of data, secure validity for e-contracts and e-signatures and uphold the principles of net neutrality.

Alongside commitments to a ban on unjustified data localisation, enhanced data provisions offer UK firms a golden opportunity to grow their business relationships in Japan.

This is especially true in the era of coronavirus, when many firms have been forced to work remotely, and these digital and data provisions offer a positive way forward for UK-Japan trade in legal services.

What this means for solicitors

CEPA, like the EU-Japan Partnership Agreement (EPA) before it, secures the right for foreign lawyers to practise under their home title, establish offices and register as a foreign lawyer in Japan.

In addition, CEPA encourages new commitments in Japan’s domestic regulation regarding licensing and qualification procedures.

Included in this are provisions around publicising details of fees and timeframes, limiting the number of competent authorities that need to be approached, providing more opportunities to place applications, and accepting electronic applications wherever possible.

CEPA also expressly mentions the requirement for renewal processes to be made public.

CEPA’s provisions complement recent changes in domestic regulation in Japan which reduce the experience requirements for registration as a foreign lawyer and clarify the scope of representation by foreign lawyers in international arbitration proceedings.

Together, the UK and Japan account for 9.2% of global gross domestic product (GDP) with trade between the two countries currently worth around £31.6 billion per year.

With a population of 126 million, Japan represents a significant export opportunity for UK goods and services. Estimates say that the CEPA could add an additional £15 billion to UK-Japan trade.

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