Legislation to Address the New Century

Tetsuya Katada Vice Chairman, Keidanren Chairman, Komatsu Ltd.

Last year, through a variety of commemorative events, Japan celebrated the passage of the 100th year since the enactment of its Civil Code, with the centennial of its Commercial Code following suit this year. A century ago (in 1898 for the Civil Code), prompted by an awareness that the establishment of a legal framework would be essential if Japan were to become a full member of the modern world, the government's leaders guided the process that resulted in the enactment of basic codes within an extremely short period of time. As a guide, Japan looked to the codes of modern European states, particularly those of Germany and France.

The Criminal Code enacted at that time was re-written in current plain Japanese in its full text in 1995, while the Code of Civil Procedure was amended across-the-board in 1998. The Civil Code was also amended to cover a new system of guardianship for majority this year, and a review of some other major laws is actively taking place in the face of the 21st Century.

Recently, we have observed many activities aimed at enacting or amending laws in line with the move toward standardization and harmonization of global dimensions in order to address the age of global mega-competition. In Japan, in response to an accelerated rate of change in the legal environment, time for deliberation at the Legislative Council has become shorter, while the amount of legislation initiated by the members of the Diet has increased deserving special note. In addition, we see some new ideas at work in terms of legislative procedures and techniques, such as the use of the Internet to learn the opinions of the concerned public during the review stage for proposed bills.

Currently, corporate separation legislation is under review at the Legislative Council and a review of insolvency law is proceeding. Elsewhere, legislation for financial rehabilitation or recovery of industrial competitiveness has been passed, putting in order a system to address the issues of the new era. In the private sector, too, efforts are under way to realize a corporate system and culture, which can provide true international currency. Through self-motivated improvements corporate governance reform, and increased soundness and efficiency of management are being promoted.

In order to ensure that these activities, at both the governmental and private levels, translate into results, legislative support is absolutely indispensable. In this respect, however, we cannot help but state that the response in the area of economic law and its regulations, including the Commercial Code as the basic law, is still inadequate. Given the incredible speed at which the global management environment is changing, the state of affairs in this area brings home to us an awareness that law amendment activities still fail to address such changes in the world. Hence, our demand for energetic legislative activities under strong leadership of the government. We suspect this situation suggests the need for us to continue to speak up aggressively to the legislature and to participate actively in the process.