About the current Japanese law of obligation reform

Did you know? About the current Japanese law of obligation reform

(Source: Japanese Ministry of Justice website)

In February 2013, the Japanese legislative committee submitted an interim draft on the civil code reform (law of obligations). Although it cannot be predicted whether and to what extent this interim draft will find its way into the new civil code of Japan, it can be assumed that  it will be based on it. In addition to amendments to the general law of obligations and contract law,  it also contains changes to all types of contract regulated in the civil code.

The modernisation of the law of obligations also serves to harmonise it with international trade law, particularly the Vienna Convention (CISG), which Japan joined in 2008 (with effect from 1 August 2009) and which also applies to Germany, and the UNIDROIT Principles of International Commercial Contracts (PICC).

Particular reference is made at this point to the General Terms and Conditions, which are hitherto not regulated by law in the Japanese civil code. The nominations now being proposed in the civil code would eliminate the existing legal uncertainty in the application of these GTCs. The modernisation is expected to make the choice of law among other things more attractive in favour of the Japanese civil code in international business transactions. This would enable companies to decide in favour of Japanese law more easily, despite it being difficult to understand for many foreign companies. This would mean more legal certainty for Japanese companies, and in turn a reduction in costs.