JAPAN Trends and Developments Contributed by: Masanobu Hara and Masashi Kobayashi, TMI Associates
Discussions are underway on autonomous vehicles Autonomous vehicles are discussed further below. Claims based on liability for cybersecurity vulnerabilities are emerging The European Commission released a draft amendment on the Product Liability Directive (hereinafter referred to as the “Product Liability Directive Amendment Draft” ) on 28 September 2022. Discussions had been held specifically in response to the rapidly changing business envi - ronment in recent years, such as the dissemina - tion of internet of things (IoT) products and AI. The EU adopted the Product Liability Directive Amendment Draft, which came into effect on December 8, 2024 (hereinafter referred to as the “Amendment on the Product Liability Directive” ). It is expected that discussions will advance in Japan based on such global discussions. In this article, the authors present the latest discussions relating to the PLA in response to the rapidly changing business environment described above. Legal Liability for Product Liability, etc, Related to the Software of Automatic Operation Systems Product liability for software The term “product” as used in the PLA in Japan refers to movable items that are manufactured or processed and are construed to be tangible (Article 2 (1) of the PLA). Since software itself is intangible, it is not “product” and is not subject to product liability. However, the movable equip - ment that is embedded with the software is a product.
In recent years, products, software and digital services have become more closely linked and collaboratively provided to consumers. Accordingly, the Amendment on the Product Liability Directive states in Article 4 (1) that the software itself is subject to product liability. Fur - thermore, in light of the increasingly common practice of digital services being integrated in or interconnected with a product, as exemplified by the need for the continuous supply of traffic data in navigation systems, the Amendment on the Product Liability Directive states in Preamble 17 that it is necessary to extend no-fault liability to such digital services, as they determine the safety of the product just as much as physical or digital components do. There is still a need for discussion of this topic in Japan. In the event the software of the autonomous operation system is defective As examples of closely related and linked products, software and digital services include autonomous vehicles. Many manufacturers in Japan and overseas are developing technolo - gies and conducting public road demonstration tests for autonomous operation systems, while also working on the commercialisation and dis - semination of such technologies. Autonomous driving is available on the mar - ket in the form of vehicles that perform partial automatic driving with a driving support system. However, it is expected that, ultimately, there will be fully automated vehicles, where the autono - mous system will perform all the driving tasks and the user will not be expected to take any action. Until recently, when a traffic accident occurred, the negligence of the driver was usu - ally a point of dispute. However, if autonomous
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