[ Nippon Keidanren ] [ Policy ]
Nippon Keidanren and BDI Call for a
Framework for Enhancing Economic Relations
Between the European Union and Japan
August 30, 2007
Japan and Germany not only play an important role in the integration within their regions, but should also take the lead in advancing the relationship between Asia and Europe. Japan and Germany need a closer cooperation to overcome the common challenges our countries face.
In a globalizing world and with Germany as a member of the EU, we believe that a stronger economic tie between the EU and Japan is the key to strengthening the competitiveness of our countries. Many more efforts need to be made on both sides so that current favorable economic relations do not lead to a state of mutual indifference.
With this in mind, Nippon Keidanren and BDI call on the Japanese and German authorities to make every effort to establish a framework for enhancing economic relations between the EU and Japan.
1. EU-Japan agreement for the enhancement of trade and investment
In order to improve business predictability, level the playing field, and enhance economic relations, it is imperative for both the EU and Japan to develop and improve their respective rules and systems for economic activity, and to promote their harmonization.
The goal should be to conclude an EU-Japan agreement for the enhancement of trade and investment. Such an agreement has to be conceptualized and understood as a core of the framework for advancing the bilateral relations.
The agreement should include the following;
- Reduce the costs on importers and consumers imposed by border and behind-border measures.
- Further promote regulatory reform based on the progress achieved as in the EU-Japan Regulatory Reform Dialogue
- Enhance the cooperation regarding new global standards.
- Effectively enforce intellectual property rights to regulate counterfeits and pirated products, impose stricter penalties and enhance cooperation on countermeasures in third countries against such counterfeiting and piracy.
- The Generally Accepted Accounting Principles (GAAP) of Japan should be accepted as an equivalent to the IAS/IFRS adopted in the EU and vice versa.
- Ensure transparency and a common international understanding on transfer price taxation. Establish a joint forum to reduce compliance costs such as documentation and to facilitate the conclusion of bilateral and multilateral Advance Pricing Agreements (APAs).
- Promote bilateral social security agreements to eliminate double contributions of social insurance premiums.
- Simplify procedures for granting approval of work and residence permits; promote speedy processing to improve business and investment environment.
2. WTO Doha Round to be successfully concluded
The above bilateral agreement should be designed to pursue more liberalized trade and investment than what can be achieved through negotiations within the WTO framework so that they complement each other.
In the light of importance of the WTO multilateral approach, Japan and the EU, in which Germany is a leading member, should work together to successfully conclude the Doha Round by the end of this year.
3. Innovation for sustainable growth
As innovation is the key to sustainable growth for Japan and the EU, concrete measures to protect intellectual property rights and to enhance innovation need to be taken. Japan and Germany as high-tech nations should take the lead and intensify their collaboration.
- Further improve a common international legal framework that would enhance the enforcement of the protection of intellectual property rights with a central focus on preventing the spread of counterfeit and pirated goods.
- Designate fixed dates for campaigns of combating counterfeits and piracy in order to raise public awareness.
- Further harmonize and streamline national patent systems. According to the "Alexandria Process" currently held among developed countries, an international agreement on a "first-to-file" system for patent applications should be concluded swiftly.
- Support early deployment of next generation technologies by promoting a wide range of collaboration in R&D.
4. Climate protection and energy efficiency
Given the evidence that global climate change is already taking place, it is in the fundamental long-term interest of Japan and Germany to increase energy efficiency in a manner that promotes sustainable economic growth.
- Establish a flexible and diverse international framework to address global climate change beyond 2013, in which all major emitters to participate, serving to achieve compatibility between environmental protection and economic growth.
- Promote long-term, market oriented governmental policies to encourage improvements in energy efficiency and the application of new technologies.
- Promote mutual acceptance of systems for low energy consumption and labeling products.
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