Japan - Arbitration Law and Practice in Asia
I. INTRODUCTION: ARBITRATION IN JAPAN — HISTORY AND INFRASTRUCTURE
A. History and Current Legislation on Arbitration
1. Historical evolution of law relating to arbitration
The first statute on arbitration in Japan was enacted in 1890 as part of the Code of Civil Procedure. This set of provisions, modelled after nineteenth-century German law with just 20 articles had, from a modern viewpoint, several shortcomings. Some examples include more grounds for setting aside an arbitral award; the default number of arbitrators was two (and if they could not agree on an award, the arbitration agreement would be terminated); and the process for enforcing an arbitral award required a formal oral hearing.
Japan joined the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (the “New York Convention”) in 1961, but the old arbitration law remained during the twentieth century — for more than 110 years. However, around 2001, the Japanese government initiated an overall reform of the law and judicial system. As part of this process, the arbitration law was also reformed, modelling it after the original (1985) version of UNCITRAL Model Law on International Commercial Arbitration (the “Model Law”). The new Arbitration Act (the “Act”), enacted in 2003 and effective on March 1, 2004, is the current arbitration law of Japan.
2. Current law and possible reform projects
As stated above, the Act was modelled after the UNCITRAL Model Law.