THE AUTHORS:
Seri Takahashi, Partner at Mori Hamada
Zoe Lim, Senior Associate at Mori Hamada
Ayaka Furutani, Associate at Mori Hamada
This article was featured in Jus Mundi‘s 2025 Arbitration Year in Review, an annual publication analyzing arbitration developments across 40+ jurisdictions on 6 continents. This edition brings together young practitioners and senior experts to capture the year’s most significant legislative reforms, enforcement trends, and institutional innovations.
Japan continued to sharpen its profile as an arbitration‑friendly jurisdiction in 2024–2025 through coordinated public–private initiatives and visible community‑building. After the successful inaugural Japan International Arbitration Week in Tokyo in November 2024, the event has returned on 25–29 November 2025, signaling continued commitment to institutional collaboration and international outreach.
Key highlights from 2025 include:
- legislative and institutional developments—notably the first full year under the amended Arbitration Act;
- ISDS‑related developments, including Japan’s successful defense in an investment‑treaty case and rising outbound activism by Japanese investors; and
- market and policy initiatives that deepen capacity, internationalization, and public–private alignment.
Developments in Key Legislation: Arbitration Act
2025 marked the first full year of implementation of Japan’s amended Arbitration Act (the “Act”), which came into force on 1 April 2024.
The goal of the amendment was to promote prompt, appropriate, and effective dispute resolution in light of the globalization of economic transactions and to align Japan with the UNCITRAL Model Law on International Commercial Arbitration 2006.
Enforcement of Tribunal‑Ordered Interim Measures (Articles 24, 47–49)
It is now possible to enforce interim measures ordered by the arbitral tribunal to preserve rights and evidence pending the final award. Applicants may seek a decision authorizing civil enforcement of a tribunal‑ordered interim measure, or a decision permitting the issuance of a monetary payment order for breaches of an interim measure, depending on the types of interim measures granted.
Enforceable measures include orders for preservation or restoration of the subject matter in its pre‑dispute state to prevent significant harm or imminent danger, as well as measures prohibiting the disposal of assets, acts that obstruct proceedings, and the destruction or alteration of evidence (Article 24, paragraph 1).
The Japanese courts having jurisdiction will grant applications for enforcement unless one of the limited grounds listed in Article 47, paragraph 7 applies (e.g., the arbitration agreement is invalid due to a party’s incapacity, or the order for interim measures has been revoked, amended, or suspended by the arbitral tribunal or a competent judicial body).
Although interim measures are now enforceable in Japan, the Act does not provide for the enforcement of decisions issued by an emergency arbitrator. This means that when a party needs provisional measures in Japan before the tribunal is constituted, they must apply to the Japanese courts for a court‑ordered injunction.
Concurrent Jurisdiction of Tokyo and Osaka District Courts with Respect to Arbitration (e.g. Article 5, Paragraph2)
Previously, parties seeking to have Japanese courts deal with cases in relation to arbitration (e.g., recognition or enforcement of arbitral awards, challenges to arbitral awards) were generally required to file with the district court:
- designated by party agreement;
- having territorial jurisdiction over the seat of arbitration; or
- having general jurisdiction over the other party.
Under the amendment, however, if the seat of the arbitration is Japan, they may now also choose to file with the Tokyo or Osaka District Courts—arguably the two most sophisticated district courts in the country with regard to international business matters—creating the potential for these courts to build on existing expertise and strengthen capacities and experience with arbitration matters.
Translations (Article 46, Clause 2)
Under Article 46(2) of the Arbitration Act, a Japanese translation of a non‑Japanese award must, in principle, accompany an enforcement petition. However, after hearing the respondent, the court may now waive the requirement in whole or in part, alleviating the procedural burden on petitioners.
Developments in Key Legislation: Act for Implementation of the International Settlement Agreements Convention
Japan’s new framework for enforcing international mediated settlements has also undergone changes to complement the changes to the Arbitration Act and strengthening Japan’s appeal as a one‑stop venue for resolving and closing cross‑border dispute. The Act for Implementation of the United Nations Convention on International Settlement Agreements Resulting from Mediation (Act No. 16 of 2023), enacted on 21 April 2023, entered into force on 1 April 2024—the same day the Singapore Convention on Mediation (2019) entered into force for Japan.
Settlement Agreements Resulting from Mediation (Articles 3 and 5)
A court may now order enforcement of an international settlement agreement reached through mediation if the parties have agreed that civil enforcement is possible. The court’s decision is subject to specified grounds for refusal, such as questions regarding the validity of the settlement.
Enforceable international settlement agreements are limited to those arising from commercial disputes and do not apply to certain disputes, such as those involving individuals acting in a personal capacity (unless they are acting as businesses or for their business), family matters, or employment-related disputes.
Prior to this, there was no framework to promptly enforce international settlement agreements.
Jurisdiction of Local Courts with Respect to Mediation (Article 5)
When applying for the enforcement of an international settlement agreement, the applicant may file not only with the district court designated by the parties in the agreement, the district court having jurisdiction over the other party’s ordinary place of residence, or the district court having jurisdiction over the location of the other party’s property that is the subject of the claim or can otherwise be seized, but also with the Tokyo District Court or the Osaka District Court. This aligns with the amendments to the Arbitration Act.
Digital Court Filings (Article 10)
It is now possible to submit applications for the enforcement of mediated settlement agreements digitally, enhancing the efficiency and accessibility of enforcement.
Increased Investor State Dispute Settlement (ISDS) Activity
While Japan is known for having a relatively disputes-averse culture, recent years have seen increased arbitration activities involving Japanese parties. ISDS activity appears to be no exception.
Shift Energy v. Japan
Japan successfully defended its first investor–state arbitration claim brought under an investment treaty by Hong Kong–based Shift Energy. Although the 2023 award has not been made public, reports indicate that the dispute centered on Japan’s reforms to its renewable energy regime after the 2011 Fukushima nuclear disaster.
Beginning in 2012, feed‑in tariffs (“FITs”) were offered to renewable investors, leading to significant investment in photovoltaic plants in Japan. However, the regime was progressively revised to include reductions in FITs rates, the introduction of competitive auctions for certain projects, and a move toward a feed‑in premium (“FIP”) model in which a premium is paid on top of the market price for many projects. Shift Energy claimed an entitlement to higher tariffs from the year of its certification, however, a tribunal majority ruled in favor of Japan and rejected Shift Energy’s claim.
The limited fallout from Shift Energy has not produced the feared cascade of claims – rather, as will be explained below, action in 2025 is outward‑facing, with Japanese investors increasingly prepared to use treaty mechanisms abroad.
Potential Claim by Japanese Investors Against Switzerland
More recently, Japanese investors have sought damages from Switzerland in relation to the Swiss regulator FINMA’s instruction on 19 March 2023, to write down Credit Suisse’s AT1 bonds to zero, based on breaches of the Japan–Switzerland Economic Partnership Agreement. Two claims, one brought by a Japanese individual and another by a group of approximately 400 Japanese investors (both represented by Mori Hamada), were registered with ICSID in early January 2026.
The latter claim is one of the relatively few publicly organized “group” investment‑treaty cases against a state. Against that backdrop, the AT1 case could add to the jurisprudence on issues arising from such cases.
It would also most likely be the seventh known treaty‑based case brought by Japanese investors and may catalyze more filings by Japanese investors in the future. Historically, Japanese ISDS claims have largely been brought by major corporates—Mitsui, Itochu, JGC, Nissan, and Eurus Energy among them. By contrast, the AT1 initiative is a funded group action that lowers cost and coordination barriers for non‑“blue chip” investors. Funders’ growing focus on Japan following the Credit Suisse episode is already well-documented and could sustain this trend.
Market & Policy Initiatives
In recent years, the Japanese government and related institutions have intensified efforts to establish Japan—particularly Tokyo and Osaka—as a leading hub for international arbitration in Asia. This initiative reflects a growing recognition that ensuring swift and neutral dispute resolution within Japan is essential for enhancing the country’s global competitiveness and credibility amid the ever‑expanding cross‑border investment and trade environment.
Against this backdrop, the Japan Federation of Bar Associations (“JFBA”), a national organization representing lawyers in Japan, published an opinion paper reaffirming the public importance of international arbitration and mediation, and calling for closer collaboration among the government, relevant institutions, and the private sector to further promote these dispute resolution mechanisms.
The opinion builds upon the significant progress made in recent years, including the 2023 amendment to the Arbitration Act and Japan’s ratification of the Singapore Convention on Mediation, signaling a transition from building the legal framework to promoting practical use and effective operation.
Notably, the opinion was submitted to the Minister of Justice, the Minister for Foreign Affairs, the Minister of Economy, Trade and Industry, the Minister of Land, Infrastructure, Transport and Tourism, the Commissioner of the Japan Patent Office, and the Commissioner of the Japan Sports Agency. This submission to a broad range of departments underscores the view that the enhancement of arbitration is not merely a matter of legal reform, but also concerns national policy as it affects economic, intellectual property, infrastructure, and even sports‑related domains. It reflects the view that alternative dispute resolution forms a key component of Japan’s broader industrial and international engagement strategy.
This initiative also aligns with Japan’s 2020 amendment to the Act on Special Measures concerning the Handling of Legal Services by Foreign Lawyers (the “Foreign Lawyers Act”), which established three key rules regarding foreign lawyers:
- registered foreign lawyers may represent clients in Japan‑seated arbitrations, provided the dispute has a foreign element (parties or governing law);
- experience required for registration as a foreign lawyer in Japan may include up to two years of work experience in Japan (an increase from one year previously); and
- the amendment confirmed the legality of joint legal corporations (whereby Japanese attorneys and registered foreign lawyers may form joint law corporations).
Together, these reforms illustrate Japan’s continued commitment to developing an open, internationally trusted, and collaborative environment for dispute resolution, positioning the country as a credible and accessible venue for global arbitration and mediation.
Discover more insights into the latest developments in arbitration in 2025 from around the world now
ABOUT THE AUTHOR
Seri Takahashi is a Partner and arbitration specialist at Mori Hamada. She has extensive experience representing Japanese and international clients in international arbitration (under various rules such as those of the ICC, SIAC, HKIAC, JCAA, DIAC, and VIAC) and other dispute resolution proceedings, including third-party expert determination. Seri has spent a significant part of her career in jurisdictions that are popular arbitration hubs, including Dubai, Hong Kong, and Singapore, and has particular expertise in complex construction disputes.
Zoe Lim is a Senior Associate at Mori Hamada, qualified in England and Wales and in Australia (Australian Capital Territory), and a Registered Foreign Lawyer in Japan. Her practice focuses on international arbitration, including investor‑state and commercial disputes across industries such as finance, sports, intellectual property, and construction.
Ayaka Furutani is an Associate at Mori Hamada, specializing in international arbitration, healthcare, and financial regulation.
*The views and opinions expressed by authors are theirs and do not necessarily reflect those of their organizations, employers, or Daily Jus, Jus Mundi, or Jus Connect.
