USTR - USTR Schwab Calls for Reinvigoration of Regulatory Reform in Japan
Office of the United States Trade Representative

 

USTR Schwab Calls for Reinvigoration of Regulatory Reform in Japan
07/05/2008
 

 

WASHINGTON, DC – U.S. Trade Representative Susan C. Schwab today announced the results of this year’s work under the U.S.-Japan Regulatory Reform and Competition Policy Initiative.  She also urged Japan to devote greater attention to promoting new structural and regulatory reform measures.

“An aggressive and continuous commitment to regulatory reform is vital for Japan’s ability to boost economic growth and open its economy for the benefit of all Japanese citizens,” Ambassador Schwab said.  “Increasingly, however, new ideas to remove unnecessary regulation or improve Japan’s business environment are being challenged by defenders of the status quo.  It is critical for Japan to redouble its focus and implement new economic reforms that respond to Prime Minister Fukuda's call at Davos to further open and liberalize Japan’s economy.”

In the Initiative’s Report to the Leaders released today, the United States welcomed Japan’s latest initiatives to improve the environment for foreign direct investment.  If translated into concrete actions, recent policy pronouncements such as those made by Japan’s Council on Economic and Fiscal Policy could bring important new progress in the coming months, such as improvements to the rules relating to new mergers and acquisitions in Japan.  Separately, the report identifies the following specific new steps that Japan is already taking:

• Liberalizing the sale of insurance products through banks, thereby enabling insurance providers to improve convenience and choice for consumers;

• Hiring more staff to review product applications for new medical devices and pharmaceuticals and giving candidates more opportunities to discuss their applications with regulators, helping to further reduce delays in bringing medical products to market in Japan;

• Eliminating overtime service charges and streamlining customs clearance procedures, thus making the customs declaration process more efficient;

• Approving new food additives for use in Japan that are already accepted throughout the world, facilitating further trade in safe agricultural products and processed food;

• Affirming that equivalent conditions of competition should always be ensured in expanding the business scope of Japan’s postal financial institutions;

• Agreeing to eliminate mobile handset subsidies that Japan's dominant mobile phone carrier has sought to recover from interconnecting operators, which should help reduce high mobile termination rates that have impeded competition;

• Committing to review comprehensively in FY2008 the administrative examination system of Japan's competition policy body with a view to ensuring procedural fairness; and

• Promoting the adoption of innovative health IT systems by increasing incentives for the use of picture archiving and communication systems.

The United States was strongly disappointed by Japan’s failure to implement a science-based approach consistent with international standards and requirements to fully resolve several agricultural issues, including improving its enforcement regime for maximum residue limits.  The same concern extends to Japan’s beef market. 

“Japan’s unwillingness to fully open its market to U.S. beef and beef products, despite scientific evidence and international standards that underscore the safety of U.S. beef, remains a great concern,” Ambassador Schwab said.  “I look to Japan to take quick action to fully resolve this issue.”

BACKGROUND

This Report to the Leaders is the seventh under the U.S.-Japan Regulatory Reform and Competition Policy Initiative.  Established in 2001, the Initiative has been a key forum for the United States and Japan to promote changes that improve the business climate and enhance opportunities for trade and commerce between the two countries.  This year’s Report is being released on the eve of President Bush’s meeting with Prime Minister Fukuda on the margins of the G-8 meeting in Hokkaido, Japan

A fact sheet on the Initiative along with a summary of additional steps Japan has taken, as well as a full copy of the Report to the Leaders, can be found at www.ustr.gov.

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Related Documents:
item: Fact Sheet: 2008 Regulatory Reform Initiative
item: 2008 Regulatory Reform Initiative Report to Leaders