Commercial dispute in Japan – litigation or arbitration?
By Seiichi Yoshikawa, Koga & Partners
Lawyers often face the question whether to resolve a commercial dispute in court or via arbitration. In Japan, arbitration is not necessarily considered a favourite forum (Each year twenty or so arbitration cases are filed with the Japan Commercial Arbitration Association).
Reasons: arbitration can be more costly than litigation because parties must pay the administration fee which is as expensive as the stamp duty for filing litigation, plus the arbitrators' fee which does apply for litigation.
Arbitration can take as much time as litigation depending on how complex the case is and how busy the arbitrators are. The fact that Japanese judges are generally reliable is another reason for choosing litigation over arbitration. Of course, arbitration has its own merits.
Existence of the dispute, not to mention the nature thereof, can be kept confidential and if the parties agree, the English language can be used for the procedure and discovery (unavailable in litigation).
All in all, a case-by-case decision must be made depending on the particular circumstances and if arbitration is considered desirable, whether the other party will agree to it or not.
Seiichi Yoshikawa, Senior Partner
Koga & Partners, Tokyo, Japan
T: +81 33 578 86 81
Seiichi Yoshikawa is a senior partner of Koga & Partners and has handled many international litigation and arbitration cases including debt collection. He has served as Vice President of the Japan Federation of Bar Associations and Councillor of the International Bar Association.
Koga & Partners is based in Tokyo, Japan. Its practice areas include international litigation and arbitration, finance, competition law, M&A, media law and general corporate matters.
published: September 2013