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JAPAN Trends and Developments Contributed by: Kenji Tosaki, Hiroki Tajima and Chie Komiya, Nagashima Ohno & Tsunematsu

Nagashima Ohno & Tsunematsu JP Tower 2-7-2 Marunouchi Chiyoda-ku Tokyo 100-7036 Japan

Tel: +81 3 6889 7000 Fax: +81 3 6889 8000 Email: kenji_tosaki@noandt.com Web: www.noandt.com

In 2024, AI and intellectual property right issues were widely discussed in Japan, as in many oth - er jurisdictions. The main recent developments in Japan are discussed below. Report on AI and Copyright Issues (15 March 2024) The Copyright Act of Japan (the “Copyright Act”) is administered by the Agency for Cultural Affairs of Japan (the “Cultural Agency”). The Cultural Council, a body established under the Cultural Agency to research and review matters relevant to the Cultural Agency, has a further subordi - nate body called the Copyright Subdivision, which researches and reviews matters related to copyright. On 30 June 2023, the Copyright Subdivision decided that its Legal System Sub - committee (the “Subcommittee”) would research and review certain AI and copyright issues, and the Subcommittee commenced its review on 26 July 2023. The Subcommittee published a preliminary draft report on those AI and copy - right issues and requested public comment from mid-January to early February 2024. In response to this request, 24,938 public comments were submitted. After approximately seven months of research and review, taking into account the comments received from the public, the Sub - committee published its report, titled “Perspec -

tives Regarding AI and Copyright” dated 15 March 2024 (the “Report”). Two points should be noted regarding this Report: first, the Report is not legally binding and, second, the Report does not necessarily present one reasonable or rec - ommended view for each issue, but rather con - tains several possible views on various issues. The Report discusses, among other things: • the potential for copyright infringement during the course of developing generative AI; • the potential for copyright infringement when using generative AI; and • the potential for copyright protection for the outputs of generative AI. Potential for copyright infringement during the course of developing generative AI Overview The Copyright Act does not provide a general defence such as the “fair use” defence under US copyright law on which alleged infringers may rely in the US. Instead, prior to amendment in 2018, the Copyright Act provided an exclusive list of defences covering specific situations in which copyrighted works could be used without authorisation from the copyright owner. The 2018 amendment of the Copyright Act was intended

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