Signing of Agreement between Japan and the United Kingdom on Social Security

February 29, 2000

1. On February 29 (Tue) in Tokyo, Foreign Minister of Japan Yohei Kono and Her Majesty's Ambassador to Japan Stephen Gomersall signed an Agreement between Japan and the United Kingdom of Great Britain and Northern Ireland on Social Security (hereinafter the Agreement).
   
   
2. The Government of Japan has been conducting consultations aiming at handling the dual enrollment issue in the public pension system generated by interchanges of people between Japan and the U.K. The Government of Japan and the Government of the United Kingdom completed their negotiation after a series of five consultations including a preliminary one in February 1998. The conclusion of this agreement will reduce the burden of pension premium payment on both employers and employees. It is therefore expected that people-to-people interchanges will be facilitated, thereby further promoting closer relations between the two countries, including economic exchanges.
   
   
3. This is Japan's second agreement on social security, following the one with Germany.
   
   Main features of the agreement:
   Either Japan's or the U.K.'s social security legislation will be applied to the people who have previously been subject to the social security legislation of both countries (avoidance of double liabilities).
   
   

   (1)	A person employed in either Japan or the U.K. who is temporarily detached to the other country is exempted from application of the legislation of that country, provided the period of the detachment is not expected to exceed five years. Moreover, if the period of detachment is to be prolonged by unforeseen cases, exemption can be extended for up to three more years.
   (2)	A self-employed person is to be treated in the same way as an employed person.

   note: The agreement does not include the totalisation of the periods of coverage; however, both parties agree to consider the possibility of totalising the periods of coverage in the future.
   
   
4. Anticipated advantages
   Japanese companies which detach their employees to the U.K. will be exempted from National Insurance Contributions in the U.K. (about 20% of salaries paid by both employees and employers)
   
   note: It is estimated that Japanese companies have paid about 30 million pounds (5.4 billion yen) in National Insurance Contributions for detached employees during the three years from 1995 to 1997 (according to the Japanese Chamber of Commerce and Industry in the U.K.).
   
   

Related Information (Japan-U.K. Relations)