Commercial Arbitration in Japan: Contributions to the Debate on Japanese 'Non-Litigiousness'

Abstract:     
This article addresses an ongoing dispute in the study of Japanese law, regarding the proper explanation for Japan's historically low litigation rates. Recent debate in this area has been dominated by the work of John Haley and Mark Ramseyer, who have presented strong evidence of the existence of substantial barriers to litigation in Japan.

The article argues that an examination of the similarly low use of arbitration by Japanese corporations strongly undermines Haley and Ramseyer's argument. Arbitration in Japan suffers from none of the institutional obstacles identifiable in court litigation, so Haley and Ramseyer's arguments cannot explain its unpopularity.

An alternative explanation for Japan's low litigation and arbitration rates is developed in the article, based on a theory of the relationship between society and the law draw from the work of the prominent Japanese legal theorist Takeyoshi Kawashima, and one of his primary influences, Eugen Ehrlich.

The paper concludes with a discussion of the recent changes in Japan's arbitration law, and the rules of the Japan Commercial Arbitration Association, arguing that these changes of themselves will be insufficient to stimulate arbitration in Japan, as the primary obstacles to arbitration were not institutional. However, if a clear distinction in both law and form is developed within Japan between international and domestic arbitration, arbitration can achieve an important place as a form of dispute resolution in Japan.

While the theory is developed in the context of a discussion of Japanese law, it is independent of unique Japanese cultural or historical facts. As a result, while it successfully explains Japan's low rates of both litigation and arbitration, it can also be used to gain an increased understanding of the relationship between society and the law in other countries. The article will, therefore, be of interest to specialists in Japanese law, practitioners of arbitration and litigation in Asia, and non-specialists interested in the nature of law and its role in society.

Number of Pages in PDF File: 86

Keywords: Japan, law, Kawashima, Ramseyer, Haley, litigation, litigiousness, law and society, Ehrlich, arbitration

JEL Classification: K33, K41

Accepted Paper Series