JAPAN Trends and Developments Contributed by: Daniel Allen, Seri Takahashi, Lexi Takamatsu and Yoshinori Tatsuno, Mori Hamada
Hong Kong and concluded too quickly that interna - tional arbitration has failed in Japan. The reality is more prosaic. Japan has been taking careful, ongo - ing steps to bolster its international arbitration space through collaborative efforts by actors at all levels, from small enterprises to global trading houses and from early-career practitioners to leading specialists. Consistent with aspirations put forward in a 2024 policy report from the Cabinet Secretariat’s Inter- Ministerial Council for the Promotion of International Arbitration, 2025 and 2026 have seen visible efforts to promote and grow international arbitration in Japan. Building on the success of the inaugural event in 2024, the 2025 Japan International Arbitration Week (JIAW) was held 25-29 November 2025. The week featured events co-hosted with multiple international arbitral bodies, bringing together global practitioners to explore current challenges in international trade and dispute resolution. Looking ahead, JIAW 2026 is scheduled for 21 to 25 July 2026. Broad-Based Organic Growth, With Some Consolidation Systemic maturation and organic growth from institu - tions and in other fora have continued to be visible. Notably, 2025 marked the first full year of implementa - tion of Japan’s amended Arbitration Act, which came into force in April 2024. The amendments provided a stable statutory framework by introducing court- assisted enforcement of tribunal-ordered interim measures and expanding jurisdiction for arbitration- related applications to the Tokyo and Osaka District Courts. Alongside legislative stability, market practic - es are evolving. An increasingly visible trend in 2025 was the growing uptake of third-party funding (TPF) by Japanese parties, a topic that generated robust debate among practitioners. Growth has not, however, been evenly distributed. The specialist arbitration market in Japan remains rela - tively concentrated. Japan-headquartered firms have generally increased practitioner headcount and devel - oped larger and more sophisticated case portfolios, while some international platforms have maintained a more selective presence. That consolidation should not be read as a sign of stagnation, but as consistent with a market in which expertise is being concentrated
around teams with a sustained Japan-related arbitra - tion practice. Continued Development of the JCAA The JCAA remains the preeminent arbitral institu - tion in Japan. To support its continual growth and improvement, the JCAA has proactively taken steps to improve its offering and user engagement. Follow - ing the launch of its Advisory Board in late 2024, the JCAA announced the creation of a new Users Com - mittee during the JCAA Global Arbitration Forum in November 2025. These steps underscore the JCAA’s focus on addressing the evolving needs and expecta - tions of arbitration users. In parallel, the JCAA’s procedural framework has continued to mature. The current JCAA rules provide for emergency arbitrator procedures and expedited arbitration, giving parties options for urgent relief and more efficient resolution of appropriate cases. Togeth - er with the enforcement mechanisms introduced by Japan’s amended Arbitration Act, these tools provide a more credible procedural framework for Japan- seated disputes. Continued Development of Third-Party Funding Over the past year, interest in third-party funding in Japan has grown significantly. Japanese clients, which generally have a high level of financial sophistica - tion, have become more interested in exploring what arrangements are possible, both in the abstract and in specific cases. Funders are also showing increased interest, with many visiting the market and consider - ing funding in specific cases. A particularly promising development is that at least one Japan-based third- party funder has emerged, although the domestic market for third-party funding in Japan remains in its infancy. Areas of focus for Japanese companies include not just de-risking claims, although that remains impor - tant for companies whose decision-making processes tend to emphasise risk reduction. There is also grow - ing interest in products such as enforcement support, portfolio funding and insurance products, including after-the-event policies and related products.
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