Japan-European Union (EU) Regulatory Reform Dialogue in Brussels in FY2004
(Overview)
March 7, 2005
1. Date and attendees
| (1) | Date: Friday, March 4, 10:00-17:30 Venue: European Commission Headquarters in Brussels |
| (2) | Attendees from the Japanese side: Mr. Michitaka Nakatomi, Deputy Director-General of the Economic Affairs Bureau of the Ministry of Foreign Affairs (MOFA) (Chair); Ms. Tomiko Ichikawa, Director of the Economic Integration Division of MOFA; and officials from six ministries and agencies. |
| (3) | Attendees from the EU side: Mr. Richard Wright, Director of the External Relations Directorate-General of the European Commission (EC) (Chair); Mr. Seamus Gillespie, Head of Unit for Japan, Korea, Australia, New Zealand, External Relations Directorate-General of the European Commission; officials from the European Commission and governments of member states; and officials from the Delegation of the European Commission in Japan. |
| (4) | The director-level preparatory meeting and experts' meetings on the environment, trade and customs and telecommunications were held previously on March 3. A preparatory video-conference on medicine and pharmaceuticals took place at the end of February. |
(Reference 1)
The officials from the related Directorates-General of the EC attended the meeting to respond to all proposals raised by the Japanese side. Relevant government officials of France, Italy, Belgium and Greece also participated in this meeting to respond to the proposals that fall under the competence of these member states. Although there were no proposals made concerning Spain, Slovenia, Slovakia or Finland, government officials from these countries also took part in the meeting as observers.
(Reference 2)
Starting in 1994, the Japan-EU Regulatory Reform Dialogue has been annually held in Tokyo and Brussels in recent years. Every year, each side submits proposals for regulatory reform for the other side and both sides discuss the modality of regulations in Japan and the EU with a view to improving the business environment. Following the meeting in Tokyo in November 2004, this is the second meeting in FY2004.
2. Overview
At this meeting, the discussions were focused primarily on Japan's proposals to the EU (See attachment for list of items discussed). Substantial discussions were held regarding the following topics.
(1) Financial Services
The Japanese side pointed out that the equivalence between Japan's accounting standards and international accounting standards (IAS) was one of its major items of concern. The EU side responded that it was fully aware of Japan's interest and expressed its intention to continue discussions in an open manner from the technical aspect.
(2) Commercial Laws and Business Practices
The EU side gave an explanation on the future outlook regarding Japan's proposals on the early adoption of a draft directive allowing offset of profits and losses across multiple EU member states; a legal framework at EU level allowing cross-border mergers; the European Private Company Statue and others.
(3) Trade and Customs
With regard to the change of the tariff classification for flat panel displays, the EU side replied that it intended to seek a pragmatic solution. Meanwhile, the EU side only repeated its stance regarding the change in tariff classification of digital video cameras (camcorders) and retroactive duty imposition. Regarding Japan's proposal on "obligating declaration 24 hours before customs clearance," the EU side stated that it would be attentive to make the period required for customs procedures as short as possible, while taking in mind the requirements from the perspective of security.
(4) Information and Intellectual Property
The EU side commented that the implementation of the Community Patent System is left up to the decision of the member States and also stated its intention to continue the discussions over the opposed abolishment of the protection of design rights concerning repair parts for automobiles.
(5) Legal Services
The EU side expressed its view that it would be appropriate for Japan to engage in direct negotiations with the French and German governments regarding proposals concerning foreign lawyers.
(6) Telecommunications and Broadcasting Services
The EU side stated that concrete progress was made in the promotion of Local Loop Unbundling (LLU) such as an increase in the number of unbundled lines. It also indicated specific moves for harmonization regarding the proposal on one for the allocation of radio frequencies for wireless radio LAN. It was decided to continue discussions on the issues of ensuring governmental neutrality in the management of telecommunications companies and enhancing international exchange of contents (improvement of the Television without Frontiers Directive that requires broadcasters to reserve for "European Works" a majority proportion of their transmission time (quota system)).
(7) Transport and Automobiles
The EU side demonstrated a positive stance giving an explanation on the concrete progress for the international harmonization of regulations for pedestrian protection and the adoption of ECE Regulation No.94 and 95.
(8) Construction
Japan requested that the Belgian system be reformed, since its requirement to pay in advance 15% tax, 15% social security fee and 30% debt guarantee of the construction fee makes virtually impossible the access to the Belgian construction market by Japanese companies. This view was contested by the EU and the Belgian government claming that an exception to the national treatment in the collection of all taxes is permitted under the WTO Agreement (GATS). The Japanese side expressed its intention to continue discussions on this issue with the EU and the Belgian government.
(9) Medicine/Pharmaceutical
In response to the inquiry of the Japanese side about the current status of the discussion over the issue of parallel imports of pharmaceutical products in the EU region, the EU side stated that it was a concern not only to Japanese companies but also to EU companies. The Japanese side requested that close consultations be held with Japan's pharmaceutical industry regarding the amendment of the price setting mechanism of the Pharmaceutical Price Regulation Scheme (PPRS) in England and the Mandatory Rebate System for Pharmaceutical Products in Germany. The EU side took note of this request.
(10) Tourism
In Italy, all foreigners had been obliged to take necessary procedures to obtain residence permits at police stations within eight days from the day of entry in the case of stay within three months for sightseeing purposes. The Italian government explained that the law had been amended so that citizens of countries who are exempted from the requirement to obtain visa for sightseeing purposes for a period of no longer than 30 days may take the necessary procedures for residence permits at the border upon entry into Italy. The Italian side further announced that the required procedures would be taken immediately.
(11) Environment
The Japanese side conveyed its specific concerns regarding the REACH system (new chemical regulation in EU), which is one of the most serious concern to Japan, as well as the directive on waste electrical and electronic equipment (WEEE) and the directive on the restriction of the use of certain hazardous substances in electrical and electronic equipment (ROHS). It was decided to continue the discussions on these topics. Regarding the directive on establishing a framework for the setting of Eco-design requirements for Energy Using Products (EuP Directive), the EU side explained the need to make an individual decision for each product, and it was decided to continue the discussions on this topic as well.
(12) Work and Residence Permits
The Japanese side emphasized that simplifying and expediting of the process for acquisition of work and residence permits in the EU member states was the major request of the Japanese companies in Europe, and asked for further improvement on this issue. Furthermore, regarding the Proposal for a Council Directive on the conditions of entry and residence of third-country nationals for the purpose of employment and self-employed economic activities, the Japanese side conveyed its intention to comment on the EC's Green Paper on economic migration.
(13) Driving Licenses
The Japanese side stated its appreciation for the progress which enables the return of Japanese driving licenses to the Japanese embassies from the member states and expressed its intention to work on consultations with the government of each member state. With regard to the official letter of certification required upon exchanging driving licenses in Greece, the Greek government explained that the said requirement is not a discriminatory measure to be applied only to Japan. In response, the Japanese side pointed out that Greece was the only country to impose such a measure and requested that this issue be further addressed in bilateral consultations. The Greek side agreed on this request.
The EU side raised to the Japanese side its proposals on Japan's investment environment including the facilitation of cross-border M&A, postal privatization, food additives and flavorings, government procurement and frequency allocation of telecommunication. The Japanese side explained the current situation as to each proposal.
(Note)
Major achievements regarding Japan's proposals to the EU since the dialogues conducted last fiscal year include an alternative proposal on the Standard Contractual Clauses concerning the Data protection Directive and the issue regarding the return of driving licenses. With regard to the return of driving licenses, they had been submitted and kept by the relevant authorities of the EU member states upon exchanging them for a driving license of an EU member state. Meanwhile, the EC confirmed the understanding that in relation to the EU Directive, there should not be a problem for the relevant authorities of the member states to return these driving licenses to the Japanese embassies. Consequently, it has been decided that the details on the format for returning these driving licenses will be left up to bilateral consultations between Japan and each member state.
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