Environmental Considerations in Japan’s International Investment Agreements

Abstract

International investment agreements (IIAs) have proliferated considerably in the globalized world. Environmental measures (EMs) in states hosting foreign investment could conflict with IIAs. The purpose of this article is to analyze how environmental provisions (EPs) in Japan’s IIAs consider the environment, based on assessment of EPs contained in IIAs. This article shows that, as the whole, Japan's IIAs have sufficiently considered the environment. Japan's IIAs also have enhanced environmental considerations over time. EPs in exception clauses, especially EPs on not relaxing the EMs, play a central part in environmental considerations in Japan’s IIAs. Japan’s IIAs handle the issue of the fair and equitable treatment (FET) obligations differently than that of indirect expropriation. However, Japan’s IIAs leave ample room for improvement in some categories or types of EPs, such as EPs on the rights to environmental regulation, EPs on the FET, and EPs in procedural clauses.