Right to Regulate and Japan’s Major International Investment Agreements

Japan has been actively negotiating and concluding international investment agreements (IIAs) with a view to protecting and promoting investments by Japanese investors overseas. The Japanese government’s pro-investor, pro-investment IIA policy is strongly supported by the Japanese industry. However, the time may have finally come for Japan to revisit and review its IIA policy as climate change challenges are increasingly urgent and national security has become an essential element in the economic policy and diplomacy of states. These trends have important policy implications for Japan, not only as the home state of investors but also as the host state of foreign investments. It is essential to make sure that Japan’s IIAs not only protect Japanese investors’ investments overseas, but also preserve the Japanese government’s right to regulate climate change and national security at home. This short paper examines whether Japan’s major IIAs properly preserve Japan’s right to regulate climate change and national security.