JAPAN Trends and Developments Contributed by: Daniel Allen, Seri Takahashi, Lexi Takamatsu and Yoshinori Tatsuno, Mori Hamada
Mori Hamada & Matsumoto Marunouchi Park Building 2-6-1 Marunouchi Chiyoda-ku Tokyo 100-8222 Japan Tel: +81 3 6266 8785 Fax: +81 3 6266 8685 Email: yoshinori.tatsuno@morihamada.com Web: www.morihamada.com
Continued Growth in Japan-Related International Arbitration Over the past year, Japan-related international arbi - tration has continued to mature across several fronts. Japanese investors and companies have become more visible users of investor-State arbitration, Japan has continued to strengthen its domestic arbitration infrastructure and third-party funding has moved from a niche topic to a practical option in large disputes. The overall trend is incremental rather than dramatic, but meaningful. Investor-State arbitration has attracted particular attention following Switzerland’s March 2023 instruc - tions to Credit Suisse to write down its AT1 bonds to zero. Many international investors, including those in Japan, were substantially impacted by that deci - sion. Japanese investors benefit from the investment protections in the Japan-Switzerland Free Trade and Economic Partnership Agreement, which allows for arbitration of investment disputes. In early 2026, ICSID registered two cases on behalf of Japanese investors: Hiroshi Osumi v Swiss Confederation (ICSID Case No ARB/26/1) and S - Planning Co ., Ltd . and oth- ers v Swiss Confederation (ICSID Case No ARB/26/4). Tribunals have been constituted in those cases and they are proceeding apace. Another similar case was registered several months later and more such cases may follow. These claims have also increased interna - tional funders’ attention to the market in Japan. The phenomenon is not limited to individual or group claimants. Major Japanese corporations have suc - cessfully pursued claims against foreign states. For
example, in May 2025, reports emerged that Spain was seeking to annul a December 2024 arbitral award granted to Itochu relating to its solar invest - ments in Spain. As of mid-2026, that annulment pro - cess remains pending. In May 2025, Spain was also ordered to pay Mitsui almost EUR40 million in rela - tion to Mitsui’s solar power investments. Following a rectification decision in August 2025, Spain instituted annulment proceedings against the Mitsui award in December 2025 and an ad hoc annulment committee was constituted in April 2026. Despite those delays, recovery by non-EU solar inves - tors is not merely theoretical. In June 2025, Spain made a payment of approximately EUR 32 million tied to the JGC v Spain award, another claim originating from a Japanese investor. Because non-EU investors face fewer of the European Commission’s internal state-aid enforcement obstacles, Japanese investors such as Itochu and Mitsui may have a more favour - able enforcement profile once annulment hurdles are cleared. Japanese investors are now participating in the full life cycle of investment arbitration: claim for - mulation, merits proceedings, awards, annulment and enforcement and eventual recovery. Bolstering Domestic Capacity and Attractiveness as a Seat Promoting and developing international arbitration in Japan remains a long-term project. Over the years, many articles have declared that international arbi - tration has finally become part of Japan’s dispute resolution landscape. Others have compared Japan unfavourably with London, New York, Singapore or
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