Five decades of advocacy
The EBC marks a major milestone
JUNE 2022 Feature / Text by Andrew Howitt
JUNE 2022 Feature / Text by Andrew Howitt
There is one simple reason behind the founding and growth of the European Business Council in Japan (EBC): frustration.
In 1970, the European Community (EC) took over responsibility for trade policy from individual member states. This change, under the Treaty of Rome, kicked off trade relations with Japan at the European level. Echoing the move towards a more unified position, the heads of European firms in Japan — who were constantly confronted with tariff and non-tariff barriers, and who were finding it challenging to build stronger businesses — realised they needed a united voice if they were to have a chance of breaking down obstacles to trade, business development, and investment.
The EC Steering Committee years
In 1972, the EBC — which was first called the EC Steering Committee — was formed to help remove impediments to doing business in Japan through research by sectorial committees, knowledge-sharing, and advocacy with authorities.
According to an archived EBC booklet from 1984 titled Doing Business in Japan, “The Steering Committee, established in 1972, consists of a representative of each of the EC chambers of commerce or business associations in Japan and the chairman of each of a group of subcommittees, which have been established to study in depth those problems confronting specific industry or service sectors, or specific aspects of doing business in Japan.”
Luciano Cohen, one of the EC Steering Committee’s founding members — and then-president of Olivetti Japan — recalls that the chairmen of the chambers of commerce of France, Italy, the Netherlands, and West Germany were among those who set up the group.
“After these early days, Europe had a voice in Japan, whereas prior to the EBC, only the US had the possibility of direct contact with Japanese ministries,” he states. “That relationship started then, and it continues to this day.”
When the Delegation of the European Community to Japan was set up in 1974, the first EC ambassador “called on the European chambers to find out about the restrictions that made it difficult to facilitate imports from Europe,” says Cohen. “Information was collected and passed on to the ambassador through the Steering Committee.”
David O’Sullivan, first secretary at the Delegation from September 1981 to January 1985, was responsible for the EC’s Export Promotion Programme and the Executive Training Programme, both of which had been created to improve the performance of EC industry in Japan. During his time at the delegation, he worked closely with committee members.
“There was a group of EC companies upon which we relied for advice, called the EC Steering Committee, from the different national chambers of commerce,” he says. “The big complaint of the EC at that time was that Japan was availing itself of the relatively open nature of the European economy to export extensively, while various kinds of non-tariff barriers were preventing European industry from penetrating the Japanese market.”
A long battle over liquor
Cohen recalls the long, but ultimately successful campaign — that dragged on through the 1970s and 1980s — to eliminate the discriminatory treatment of European alcohol exports to Japan.
Introduced in 1962, Japan’s liquor tax law divided alcoholic drinks into categories. All imported whiskies and brandies were given a premium grading, subject to a high level of tax, while the locally produced shochu distilled liquor, for example, was taxed at the lowest rate.
“I remember that the price of a glass of Cognac in Ginza could be between ¥30,000 and ¥40,000,” says Cohen. “An important action carried out by the EC Steering Committee was the creation of the Liquor Subcommittee, which researched the restrictions on the import of liquor, and this led to an important change in import rules and duties.”
Using information collected from committee members — those European firms directly affected by the unfair practice — the EC launched formal consultations with Japan in 1986, and Japan made reforms to its liquor tax law in 1989, with the matter finally being settled through the World Trade Organization in 1998.
More than a voice
In addition to advising the delegation, members of the EC Steering Committee helped create the Executive Training Programme in 1979 and were involved in its implementation.
“We created a study group for between 25 and 50 young businessmen, who were picked to study Japanese and Japanese business for 18 months, then trained at two firms in the sector of their choice,” says Cohen. “This programme, financed by Brussels, went on for more than 20 years.”
Cohen was also involved in promoting European trade and market entry to Japan. In an article from 9 February 1980, The Japan Times reports that he helped to organise the first trade mission to Japan from the European Common Market, comprising representatives of 25 foodstuff manufacturers and dealers from eight European nations.
“While few sales contracts were concluded during their brief visit, the mission members had obtained a bright outlook on future tie-ups with Japan,” Cohen told the newspaper.
This mission was followed by two more foodstuff-related missions and then at least two machinery missions, all within the first half of 1980.
The EC Delegation’s O’Sullivan says: “The main achievement of the EC Steering Committee was to give a European identity to the business interests of companies operating in Japan. This considerably increased their leverage in dealing with the Japanese authorities.”
When the European Business Council in Japan was officially registered in 1983, it had added to its membership the chambers of commerce of Belgium–Luxembourg, Denmark, and the UK, as well as firms from Ireland. At the time, the EBC represented more than 1,100 European businesses in Japan.
In 1970, Japan’s trade deficit with the EC had been a relatively small $700 million. But as the nation became an internationally competitive exporter of manufactured products — and while its unconventional economic structures kept imports low — this deficit grew exponentially over the next two decades to as much as 19.27 billion ECU in 1988. As a result, trade relations between the two economies were strained throughout the 1980s.
The first chairs of the EBC were active in publicly voicing the European business community’s frustrations with the Japanese government. For example, Robert Appeldoorn, chairman of the EC Steering Committee in 1983, attended a February Diet session on trade friction and called on Japan to “set a specific goal to increase its manufactured imports” from the EC, according to The Japan Times.
In October 1984, his successor, Wierd J. Minzinga (EBC chair until March 1985) — who was also chairman of Shell Sekiyu K.K. and president of the Netherlands Chamber of Commerce in Japan — spoke at a meeting with the Ministry of International Trade and Industry, stating that EBC members were not being given sufficient information on Japanese procedures and investment opportunities. The following January, he denounced the problems foreign banks were facing in Japan at a hearing in the Diet on Japan’s market-opening measures.
At a Ministry of Foreign Affairs meeting on external economic measures held in June 1985, Claudio E. Bellavita (EBC chair from April 1985 to late 1986), representative in Japan of the banking group Intesa Sanpaolo, requested that Japan improve its standards and certification system for imported goods.
Complaints from European firms continued to pile up, and the EBC continued to present these to the authorities. To address some of the issues, the Japanese government released, in July 1985, a document entitled “The 1985 Action Programme for Improved Market Access”, which the EBC initially evaluated as being “a helpful series of measures” having “positive proposals on standards [and] certification”. But by November 1986, the organisation expressed “misgivings” about the progress on proposed actions and felt the need to “reassess” the programme. It responded with its own document that presents the major issues that still needed to be resolved.
“Whilst the programme itself recognised the need for action in improving market access, this call for a review of progress perhaps confirms that there is still much to be done,” the EBC wrote in this document, which gives an overview of several issues the European business community was facing.
The 10 subcommittees covered in the report include Cut Flowers; Foreign Lawyers; Liquor; Pharmaceuticals; and Universal Banking. It could be considered a precursor of the EBC white paper.
Under the Automobiles, Power Units, and Components Subcommittee section, for example, one of the seven recommendations made is that “Presentation of each vehicle individually for an initial inspection under the Type Notification System should be abolished.” And, concerning participation in trade fairs, the Capital Goods, Engineering & Machinery Subcommittee reports that “The importers of machinery and capital goods strongly oppose the practice of being given exhibition space only in special halls exclusively reserved for imported goods” since it is noticeable there is “a considerably reduced number of visitors”.
In the EBC archive, there are many letters signed by Alfred P. Dienst (EBC chair from late 1986 to June 1989), president of Hoechst Japan and chairman of the German Chamber of Commerce and Industry in Japan. One, dated 20 August 1987 and addressed to Japan’s Administrative Inspection Bureau in Charge of Overseas Economic Matters, gives a glimpse of the Japanese government’s attempts to delay discussions and stall reform.
It seems a document of opinions and requests from the EBC, European embassies, and the EC Delegation — based on the EBC’s response to Japan’s 1985 Action Programme — had been sent to the bureau. When written reactions were received, the EBC had responded, and the bureau sent further reactions to the updated responses. It is unclear how many times the process was repeated but, in his letter, Dienst sounds somewhat exasperated.
“[It] remains a fragmentary and incomplete document on problems and issues existing with reference to the Action Programme and the market opening,” he writes. “We therefore can only repeat our opinion that continuing in this way, of collecting requests and offering explanations, cannot lead to the results desired. Only in direct consultations between the parties representing foreign exporters and the specific government agencies concerned can progress be achieved.”
Despite the challenges, many committee members worked hard to have their voices heard and see meaningful change take place for their businesses — and new committees were formed.
In 1987, Jean-Louis Claudon, then head of the Tokyo office for Arianespace, contacted Dienst about creating an Aeronautics and Space Subcommittee. Dienst told him that, if he could find six firms that were interested in joining, it could go ahead.
“I got eight — and, before the great M&A shakedown about a decade later, we had more than 20 members,” says Claudon. “Our committee was quite active, regularly visiting ministries, politicians, and industry organisations. We held a press conference to complain about market access — which was the main problem at that time for the whole world. We also complained that, in our sector, Japanese purchases abroad were systematically American.”
Laurent Swinnen became president of the Belgian–Luxembourg Chamber of Commerce in Japan in 1989 and represented the chamber on the EBC’s board of governors. He worked for a Belgian group called Petrofina, selling petrochemical polymers, coatings for ships, as well as industrial lubricants and jet fuels. His “biggest nightmare” was that European standards were not recognised in Japan, so “we had to redo all kinds of tests to get our products accepted”.
Swinnen sums up the attitudes of Europe and Japan on trade at the end of the 1980s:
“I remember that in Europe, the relationship with Japan was more like economic war than cooperation. That was the dominant feeling,” he says. “At that time, Japan thought that Europe was building a kind of fortress [as the EC launched its Single Market Programme]. Relations were based on suspicion rather than confidence.”
Engaging with Japanese ministries
An active member of the EBC since its founding, Luciano Cohen — who, in 1981, established his own firm, Japan Europe Trading — acted as chair from July 1989 to February 1991.
In an article in the 31 January 1990 issue of The Japan Times, he lists a number of challenges European firms were still facing in Japan. They include “additional costs resulting from complex import procedures, warehousing, labelling requirements, and duties intended to protect Japanese industries” and were factors that continued to “discourage some European countries from exporting to Japan”.
“The price that an exclusive distributor has to pay to enter this market and gain a reasonable market share is very high in comparison to Europe,” he told the newspaper. “The risk is especially high.”
In February 1991, in recognition of his years of dedication to the EBC and the high-level relationships he had developed with the Japanese authorities, Cohen was named honorary chairman and continued to help the EBC maintain its good relations with government ministries.
Cohen was succeeded by then-president of Shell Kosan Anthony J. C. Brak, from February 1991 until January 1992. His quarterly newsletters, entitled EBC News, include a message from the chair and updates from individual committees. They were printed on blue paper and stand out among the EBC’s archival materials.
“The first quarter of the year has seen many EBC activities at various levels and in different areas,” he wrote in the EBC News for April 1991, adding that “a dialogue was held with the Cabinet Office on 11th March to explain the objectives, workings, and complaints of the EBC.”
Evidently, the EBC had now established relations with the Japanese government at a high level.
Willing to listen
Before Mark Bedingham — then-president of Jardine Wine & Spirits K.K. — was EBC chair (February 1992 to December 1994), he acted as chair of the EBC Liquor Committee in the second half of the 1980s and early 1990s, while it was still fighting for change in Japan’s unfair liquor tax law.
“We had some major successes with appeals, first under GATT [the General Agreement on Tariffs and Trade] and then at the at the WTO [World Trade Organization],” he says. “This led to a major reduction of import duties on alcoholic beverages and, eventually, a harmonisation of excise duty across product categories.”
He recalls that, during his time as chair, there was a noticeable shift in the relationship between Europe and Japan.
“I would say relations were quite positive,” he states. “The bubble had burst, and Japan was not looking as omnipotent as it had during the ’80s. Japan remained a very important market for many European and American companies (China had not yet emerged) and the questions of trade balances and market access were still key concerns. But now the Japanese administration was more willing to listen — although obfuscation remained around the possibility of removing non-tariff barriers and opening the Japanese market.”
A seat at the table
Laurent Dubois, partner at TMI Associates and head of Union des Fabricants in Japan, joined the EBC in 1988 and, to this day, chairs its Intellectual Property Rights Committee. For nearly 35 years, he has observed the changes in Europe–Japan relations and at the EBC first-hand, witnessing — and being part of — a number of successes.
“The EBC has evolved according to the problems that it has had to solve,” he says. “And since it exists mainly for the committees, which themselves exist only because of tariff and non-tariff barriers, as the EBC helps to solve problems, it dutifully saws off the branch it sits on. That said, the Japanese government is pretty good at growing new branches over time.”
Regarding the first full decade of his membership in the EBC, he highlights the interdependent and “intense” connection between the EBC and European institutions in both Brussels and Tokyo.
“Until the end of the 1990s, there was a great deal of solidarity between the two organisations. It was undoubtedly because the level of tariff and non-tariff barriers was such that the two parties had a clear need for one another,” he explains. “The Commission needed the EBC to provide it with the cases and feedback from the field while the EBC needed the Commission to put pressure on the Japanese government. Even many of the EBC meetings were held at the Delegation, and the Delegation members likewise participated as active observers in committee meetings.”
In 1982, Japan created the Office of Trade and Investment Ombudsman (OTO) to hear the complaints lodged by foreign firms regarding non-tariff barriers. The EBC was given a seat along with a representative from the American Chamber of Commerce in Japan and someone representing businesses from Asian countries. In the 1990s, Dubois became the EBC representative at OTO meetings and had regular opportunities to enumerate the various difficulties EBC committee members were encountering.
“The ministries concerned were obliged to respond to our complaints in front of a panel of Japanese businesspeople who were sometimes as critical of the attitude of the administration as we were ourselves,” he says. “This was how various subjects of interest emanating from the committees were discussed, such as the list of authorised ingredients for cosmetics, tests for medical devices, standards applicable to construction materials, import restrictions on cut flowers, and the repression of counterfeits. The OTO was closed in 2007 without it really being known if it has achieved its goals.”
An authentic victory
In the mid-1980s, Japan was flooded with counterfeit products of well-known trademarks and the country was dubbed the “fake paradise”, according to Dubois. When he joined the Patents, Trademarks, and Licences Committee (now the EBC Intellectual Property Rights Committee), it had a “very large number of members” including lawyers, councils, and companies, but it focused more on advocacy regarding patents and trademark protection, than on counterfeits. With Dubois as a member, this soon changed.
“Under the impetus of the Patents, Trademarks, and Licences Committee, the Commission decided to set up a fact-finding mission on the issue of counterfeits and began putting together an in-depth dossier,” Dubois says. “I was even asked to go to Brussels for two days of questioning so that a strong enough case could be built. The Commission called for a meeting at Japan’s foreign ministry, where they submitted two 600-page volumes in front of the extremely surprised eyes of the Japanese who did not imagine that the issue of counterfeits could be of such importance.”
The message got through. In the weeks that followed, the Japanese authorities took the necessary steps to begin what would become, in a few years’ time, “an effective anti-counterfeiting policy”, according to Dubois.
“The policy has been so effective that it’s fair to say the situation is now almost resolved — save for the online sale of counterfeits, mostly from China — and the means of action that owners of trademark rights have in Japan are probably unmatched in other countries,” he says. “This joint action between an EBC committee and the European Commission exemplifies what cooperation can achieve.”
Recommendations in black and white
In 1991, the EBC hired Keld Hammering, the organisation’s first full-time executive director who worked at the EBC until 1998. The EBC white paper was first published in 1995, and it was Hammering’s responsibility to compile these reports. The white paper outlines the major issues committees were facing and gives recommendations for improving the business environment in Japan for European firms.
“I started the EBC white paper, which replaced our viewpoints reports [on individual advocacy issues],” he says. “It was a lot of work to create more than 100 pages with all the different committees contributing.”
The 1995 white paper lists 24 committees, including Animal Health, Chemicals, Industrial Raw Materials, and Investment. By this time, the chambers of commerce of Sweden and Switzerland, as well as the Finnish Business Council and the Austrian Trade Commission, had become EBC stakeholders. The introduction in the first white paper notes that Japan is experiencing a deep and prolonged economic slowdown and “firm governmental action” is required to sustain the hesitant recovery.
“It is a most appropriate time for the Japanese authorities to address the need for change by implementing suggestions put forward by the foreign business community in Japan, including those summarised in the EBC white paper,” it concludes.
Like Dubois, Hammering speaks of the close relationship at the time between the EBC and the EC Delegation, which became the Delegation of the European Union to Japan in 1993.
“The EBC and the EU Delegation worked very, very strongly together. We also worked well with all the national chambers of commerce and the national embassies. I often gave talks at the embassies,” he says. “The EU Delegation had a monthly meeting where the EBC chairman, Alain Coine, and I often participated. So, we briefed him about what we knew, what the tendencies were, and what the problems were.”
Alain Coine, president of Rhône-Poulenc Japan, served as EBC chair from January 1995 to December 1996. He recalls that major areas of advocacy for the EBC during his two years as chair were agriculture, specifically certain food products; the automotive sector; financial and legal services; and animal health products.
“Under pressure from the EBC, the Japanese government agreed to fully open Japan’s animal health market,” says Coine. “This benefitted several European companies. Within six months, the largest Japanese animal health firm entered into a joint venture with a European company.”
He also notes that progress was made in the automotive industry towards the harmonisation of technical rules regarding spare parts, which allowed European car manufacturers to accelerate sales in Japan.
Peter Woods, president of Rover Japan — and head of the EBC Automobiles Committee for many years — took over from Coine as EBC chair from March 1997 to December 1998. To replace Hammering, he hired Alison Murray as executive director, a position she held for exactly 20 years, from July 1998 to July 2018. Woods gave her the responsibility of better establishing the EBC.
“Executive operating board meetings were held in Peter Woods’ office at Rover Japan — because that’s where the EBC was located. We had no presence, no name on the street or anything like that,” she says. “He told me when I was employed, that my job would be to get the EBC into a proper office, get a proper profile, and improve the funding.”
The following year, the EBC opened its permanent office in Hanzomon.
Up and running
Although the EBC had remained very active with information-sharing and report-writing, it seems that some of its connections within the Japanese government were lost in the mid-1990s. Perhaps a sense of fatigue had set in among members after years of advocacy, with only moderate progress having been made, while countless frustrating non-tariff barriers remained in place.
Hammering recalls that in 1994, when delivering a report to the Ministry of Finance with Frank Hesske, who was minister-counsellor and deputy head of deregulation at the EU Delegation in Japan, they were “poorly treated” and Hesske was not given the degree of respect his position deserved.
At the start of 1999, some of the committees had become inactive, or certain committee chairs were not committing the time necessary to run their committees effectively. However, this began to change when the EBC was visited by members of the Japanese government.
“At that time, people from the Ministry of Economy, Trade and Industry [METI] came to our little office and said, ‘We need help. We have to get a consolidated tax system going in Japan, and we need input from the foreign business community,” Murray says.
Unfortunately, the EBC Tax Committee was dormant because the chair at the time, an executive at an automotive firm, was extremely busy with his work.
“So, together with members of the EBC Tax Committee, I prepared a position paper on consolidated tax,” says Murray. “The new chairperson, Isabelle Hupperts, and I went into METI and talked with them, and we managed to get the Liberal Democratic Party’s tax reform committee to meet us for breakfast. So, that got our Tax Committee and the chairman engaged again.
“After that, the two of us worked together to get some of the other inactive committees functioning again,” Murray adds. “We had to do a lot of the heavy lifting.”
But Isabelle Hupperts (EBC chair from 1998 to 2002), then-chief representative for Japan and Asia–Pacific at Société Générale de Belgique, was more than up to the challenge.
“We carried the responsibility of the EBC on our shoulders with a lot of passion. Without passion, faith, determination, and stubbornness, you don’t do these things,” she says. “In this country, there are so many anomalies that are unacceptable, we’ve got to fight, right?”
One good example she cites of an unacceptable anomaly is in the cut flowers sector.
“Sometimes, there were 100,000 tulips or more that were getting stuck in quarantine because of Japan’s plant quarantine regulation,” says Hupperts. “And we just had to keep dealing with the same nonsense.”
Under its plant quarantine regulations, Japan practiced a zero-tolerance policy for all but 63 organisms, none of which were relevant to the cut flower sector. So, even if one insect common in Japan was found in a shipment of tulips from the Netherlands, for example, it would be rejected — essentially making all the flowers worthless and leading to losses for the importer. According to the 1998 EBC white paper, this regulation was “outdated and not in line with internationally accepted standards”.
Despite a risk assessment chapter being added to the plant quarantine law in 1996, the government still failed to make a distinction between harmful and non-harmful organisms. The discovery of common insects, such as thrips, mites, and aphids, was responsible for 80% to 90% of rejected shipments.
The same problem had persisted for well over a decade. In a report from August 1987, the committee submitted to the government the following opinion: “Improvement of the ‘zero tolerance system’ peculiar to Japan (In case insects are discovered at the re-inspection in Japan, all the flowers in question shall be fumigated or abolished regardless of whether the insect is noxious or not).”
Unfortunately for importers, the problem would persist well into the next decade.
And the mention of “re-inspection” points to another unacceptable anomaly in the cut flower sector. In 1985, Japan and the Netherlands had agreed to a pre-shipment inspection system, where Japanese inspectors would check shipments of flowers before they were sent to Japan.
But an EBC document from November 1986 (the one in which the EBC was responding to Japan’s failure to make progress on its Action Programme) reveals that they were often subject to inspection again on arrival in Japan. Among its eight recommendations, the EBC Cut Flowers Subcommittee gives the opinion that: “Flowers pre-inspected by Japanese inspectors abroad should not be inspected again in Japan.”
“This was really an ongoing problem,” says Dubois of the EBC Intellectual Property Rights Committee. “All of these practices were in place to benefit the local flower producers.”
Projecting a unified voice
Hupperts believed firmly that the work of the committees was the key to effectively lobbying the Japanese government and would bring real, long-term value to European firms. Since committee members were all dealing with the same market access issues and lack of transparency from the Japanese government, and since they all wanted to see deregulation and a better business environment for investment and business development, Hupperts emphasised the vital importance of having a unified voice through the EBC.
“I found it fascinating to be able to put people who are competitors around the same table. You had all the big banks, all the big chemical companies, all the big cosmetics companies, and everybody’s trying to sell their products in the same market. We’re from different countries, we speak different languages, we’re all competing, but we’re all around the table, and we’re all sharing information about our problems. Why? Because there’s something wrong here,” says Hupperts. “We’re around the table to try and formulate — in one voice — our difficulties in dealing with Japan.”
Murray adds: “The EBC has access to government officials, to ministers, and even to prime ministers. Under the EBC banner, companies can be anonymous in delivering their message to the government, and this way they can have a voice in shaping policy in Japan. I think that’s the EBC’s greatest strength.”
The best way to project a unified voice was through the white paper, and Hupperts decided the EBC needed to invest more time, energy, and money in redesigning, producing, and distributing it. Since it had not been published in 1997 or 1999, she also insisted that, from then on, it had to be produced annually.
“My ultimate goal was to have the strongest possible tool for the new millennium to define and promote the EBC’s views on the Japanese business environment on a yearly basis,” she states. “Backed by the national chambers — and thanks to the perseverance and talent of our executive director, Alison Murray, and our political editor Casey Sedgman — we put together Issues for the New Millennium: The EBC Report on the Japanese Business Environment, 2000.”
When the white paper was published at the start of the 21st century, the EBC had 27 committees, more than 360 committee members, and represented over 3,000 European firms from 13 European chambers of commerce and business associations in Japan.
For its launch, Hupperts delivered the white paper in person to several ministries. She was accompanied by the ambassador of the EU Delegation and the ambassador of France, which held the presidency of Europe at the time, to show the Japanese authorities that European firms spoke with one voice and had the full support of the embassies and the EU.
In 2000, Hupperts secured a seat for the EBC at the annual high-level EU–Japan Business Round Table, which was held that year in Tokyo and the following year in Brussels. There she had a platform to highlight the committees’ concerns — and all subsequent EBC chairs have had a seat at the table.
“Our EBC white paper not only played an important role in these discussions, it became a reference source,” says Hupperts. “As a result of our collective efforts, the white paper was thereafter systematically taken into consideration whenever high-level talks were held between Japan and the EU.”
Continuing the fight
In the 1990s — Japan’s humbling “lost decade”, following the bursting of the asset price bubble — the EU and Japan began moving towards a relationship of cooperation. This was formally realised in December 2001 with the signing, in Brussels, of the 10-year Action Plan for EU–Japan Cooperation.
According to Japan’s Ministry of Foreign Affairs, the document covers four main areas for greater and more diversified cooperation: promoting peace and security; coping with global and societal challenges; bringing together people and cultures; and strengthening the economic and trade partnership utilising the dynamism of globalisation for the benefit of all.
While many of the action plan’s specific initiatives had not come to fruition a decade later, the agreement itself showed a willingness on both sides to reduce tension and take their relationship into new territory.
EU exports to Japan had gradually been increasing since the 1980s, but Japan still had many tariff and non-tariff barriers in place. The EBC continued to fight many sector-specific battles to try and have these lowered.
The advocacy symphony
The new millennium brought new and stable leadership to both Japan and the EBC. In April 2001, Junichiro Koizumi became prime minister of Japan, a position he held until September 2006. And at the end of 2001, the EBC elected as chair Richard Collasse (January 2002 to December 2008), then the president and representative director of Chanel Japan.
Just a few weeks after Collasse assumed his role as chair, Koizumi’s special adviser for economic affairs visited him to invite him to lunch with the prime minister.
“I was very lucky because Junichiro wanted to have a better connection with the Europeans and create a dialogue,” says Collasse.
During the lunch, Collasse — who knew Koizumi was a violinist — asked him if he was familiar with the French composer Berlioz’s symphony, Harold in Italy. Koizumi said he knew the piece very well.
“Do you remember that the violin is leading the orchestra, is pulling the orchestra along? I would like you, Mr Koizumi, to do the same thing with your ministries,” Collasse said. “And he was so happy that I was talking with him about his hobby, and we had an immediate connection and loved our discussion.”
At the end of the lunch, Koizumi told his economic adviser to arrange for Collasse to meet with all the relevant ministries. Soon after, Collasse was sitting down with representatives from, among others, the Ministry of Labour, Health and Welfare (MLHW); the Ministry of Economy, Trade and Industry; and the Ministry of Finance. Their discussions were very serious and Collasse did not shy away from telling them it was unacceptable that they keep burying problems.
At one meeting with someone from the MLHW, Collasse demanded to know why the authorities were requiring multiple Good Manufacturing Practice (GMP) certificates for large medical equipment, such as a single CT scanner. It was a problem that had been reported to Collasse through two members of the EBC Medical Equipment Committee.
“They were asking for a GMP certificate for each piece, each element of the machine, including small screws and bolts, and that was unacceptable,” he says. “I really shouted at these guys, and Koizumi’s advisor also told them ‘That’s not acceptable’. And they couldn’t tell us why they were asking for so many certificates.”
Alison Murray, then EBC executive director, says: “When I started at the EBC, nobody in the Japanese government seemed to know what the EBC was. We’d try to get an appointment with METI or MOFA or one of the other ministries and they would say ‘Well, who are you?’ So, one of Richard’s biggest contributions to the EBC is that he really put us on the map with the Japanese government. And now the EBC is highly respected. We’re a first port of call.”
Even more firmly established
When Collasse became EBC chair, he was asked by members to establish the EBC as the European Chamber of Commerce in Japan. They had heard that, in other countries such as China and South Korea, there had been situations when an EBC-like business organisation had existed, but another group had started a European chamber and it led to a lot of friction, so they wanted to prevent this.
According to the previous EBC chair, Isabelle Hupperts, officially becoming a chamber of commerce was also expected to have the effect of bringing the EBC to the same level as the American Chamber of Commerce in Japan in the eyes of the Japanese authorities.
“We were finally able to get that label, and I think it was a very important way to protect the integrity of the EBC,” says Collasse. “That was one task I was asked to do, and we did it in just a couple of years.
Also, as Hupperts had hoped, Collasse was committed to publishing the white paper every year. But he made the release of the document into an event.
“The white papers were officially launched with a big meeting, where we invited the embassies, the chambers of commerce, and both the Japanese and foreign press,” he says. “We also invited representatives from the Japanese government, and they sat at my table where we could face one another.”
And Collasse carried on the tradition of cultivating a strong relationship with the EU Delegation.
“I was very involved with the EBC at the time and cooperated closely with Richard, who was very active and who also invested his company in the work of the EBC, especially when organising eye-catching events,” says Michael Reiterer, minister and deputy head of the EU Delegation from 2002 to 2007. “We used the occasion of the yearly market access talks, called the Regulatory Reform Dialogue — when experts came from Brussels — to publicly present a trade barriers report. It was also attended by Japanese minsters for administrative reform. The combination of trade policy and the stories of practical problems from the EBC was quite useful and also got media attention.
Murray recalls the day when the EBC would hit on an idea that had the potential to transform EU–Japan relations. In 2006, she was sitting together with Jakob Edberg, the EBC’s then-director of policy, and an official at the EU Delegation around the little square table in the EBC office. They were expressing their frustration over the lack of meaningful, significant change in Japan’s business environment, despite the EBC’s annual white papers and regular meetings with authorities.
“All of the dialogues between the EU and Japan were creating good, friendly relationships and had led to an open-door policy for the EBC at the ministries — but not change,” she says. “We realised that change would only happen when Japan was involved in a binding agreement. We thought it should be called an economic integration agreement, and we came up with a position paper. Richard Collasse was thrilled with the whole idea.”
When the EBC went to discuss the idea with the co-chair of the committee on Europe at the Keidanren, Hiromasa Yonekura (who would later become chair of the Keidanren), he said they had been discussing the possibility of a free trade agreement with the EU. The team from the EBC told him that what they were proposing was more than just getting rid of tariff barriers, but that it would be designed to remove non-tariff barriers, as well.
“He really embraced the idea, because he knew of many cases of non-tariff barriers affecting Japanese companies,” says Murray. “So, he started calling it an economic integration agreement, not a free trade agreement, and when the Keidanren started writing their position papers, they included non-tariff barriers. That was one of our early achievements on the path towards an economic partnership agreement.”
Plenty of people to persuade
The EBC was the first business organisation to call for an economic partnership agreement (EPA) between the EU and Japan. And the Japanese side agreed with the idea. But the next challenge was to convince the EU Commission, and it was reluctant at the time because it was just gearing up for negotiations on a trade deal with South Korea.
“I wanted very much to launch the agreement between Japan and Europe. And Koizumi told me he wanted that, as well. So, we started to work on the Commission,” recalls Collasse. “I went very often to Brussels to have discussions with people there.”
The Commission wasn’t the only obstacle to getting the ball rolling on an economic integration agreement (EIA). While certain industry players in Europe were willing to make concessions, there were others who were not just unwilling, but who were angrily opposed to removing trade barriers for Japanese firms.
“I talked about the fact that if we wanted to have an agreement with the Japanese that would be fair to us, we had to be fair to them,” says Collasse. “I had a meeting with a group of people from an automobile industry association and they were so impolite. I had to tell them, ‘I am not here by my own decision. I have been elected by all the chairmen of all the European chambers of commerce in Japan. So, I am their representative and I have a mandate; I have an agreement from them to require that we be fair in our demands.’”
Collasse, Murray, and Edberg lobbied the Commission and industry groups, they did presentations at conferences, and they took politicians out to lunches and dinners in the hope that they would finally get them engaged with the idea.
“I was fortunate to see things start to move for the EIA — I worked like a dog to get that going,” says Collasse. “I think seeing the EU–Japan Economic Partnership Agreement signed was the best measurement of the work of the EBC. Everything we did at that time really put everything in place so that an EPA would be possible.”
Murray adds: “The Japanese government officials listened to everything Richard Collasse said with a genuine intention to bring about change. His leadership when we launched discussions on the EIA was a huge factor in achieving serious engagement from both Japan and the EU, leading ultimately to the agreement.”
In 2008, the Japanese government awarded Collasse the Order of the Rising Sun, Gold and Silver Star — the highest honour that a non-Japanese person can receive — for contributing to strengthening economic relations between Japan and Europe.
“I don’t really care about decorations, but I was extremely happy that I received that,” he states. “The Japanese recognised what we were doing at the EBC so, in a way, it’s not my decoration. It’s the decoration of the EBC and all of the efforts that we’ve made for the past 50 years.”
Extensive input, immense pressure
The work of getting negotiations for an EIA off the ground continued with Collasse’s successor, Tommy Kullberg of Kullberg & Partners. He was EBC chair from January 2009 to December 2011 and had been a member of the EBC board of governors, representing the Swedish Chamber of Commerce and Industry in Japan, since 1999. By the time he became chair, the EBC had 29 sectorial committees and had grown to include the chambers of commerce of Iceland, Norway, and Poland, representing a total of more than 2,500 firms.
In 2009, the world was still reeling from the global financial crisis of 2007 and 2008 following the bankruptcy of Lehman Brothers.
“The EU and Japan have been severely hit by the global economic crisis, with successive rounds of financial turmoil, plummeting share prices, falling demand, and rising unemployment,” Kullberg wrote in an article for The Japan Times on 11 May 2009. “The EBC is, therefore, recommending a bilateral EU–Japan Economic Integration Agreement inspired by the EU single market concept to boost prosperity for all, and secure the positions of Europe and Japan as leaders on the global economic stage.”
In an e-mail to Eurobiz Japan, Kullberg stated that lobbying efforts to start negotiations on an EIA “dominated the agenda” during his time as chair.
“At the time, Japan had the lowest ratio of foreign direct investment among OECD countries and had, in many ways, built up Fortress Japan with a massive amount of non-tariff barriers in order to protect local industry from foreign competition,” he wrote. “Without the extensive input and immense pressure from the EBC, I doubt the EPA ever would have happened.”
One of the highlights of Kullberg’s time as chair was his unofficial cooperation with the former chairman of the Keidanren, Hiromasa Yonekura. According to Kullberg, Yonekura was one of the few top Japanese executives “who clearly understood the need to expose Japanese industry to the toughest competition available” from foreign companies.
“He knew that an agreement like this was necessary simply in order for Japan to stay competitive worldwide and lay the foundation for sustainable growth,” Kullberg wrote. “Competition drives growth and protection drives inefficiency and stagnation.”
At the EU–Japan Summit in May 2011, all the EBC’s efforts reached a major turning point when it was announced that the EU and Japan had agreed to embark on a scoping exercise, the first significant step towards negotiations for an EPA.
“It was Tommy Kullberg’s dedication that got the EU and Japan to the point where they could launch discussions on the EIA by the time he stepped down,” says Murray.
In addition to his work advocating for the start of negotiations on the EIA, Kullberg was a firm believer in the need to improve the EBC’s public relations.
“Tommy Kullberg’s legacy is communications,” says Murray. “He worked on our branding and a common logo to be used consistently across all EBC materials, and he had our website updated.”
In January 2010, together with the creative agency Paradigm, he launched Eurobiz Japan, which is his most lasting PR-related contribution to the EBC. The magazine was established with the goal of communicating the EBC’s message more clearly — and in a visually striking way — to the Japanese government and to be a platform that would help to deepen connections among the organisation’s members.
“Our mission is to take on tasks that cannot be addressed by individual companies and chambers. We aim to reduce all the trade obstacles and regulatory issues that EU companies face in Japan,” Kullberg wrote in the inaugural issue. “I hope this magazine can reach out to the members of the EBC and that they will let us know about the issues that matter to them.”
For the past 12 and a half years, Eurobiz Japan has covered business, trade, politics, and EU–Japan relations. It has been distributed to members of the EBC, the European chambers of commerce in Japan, the European embassies in Japan, and all members of the Japanese Diet, among others. Until 2019, Eurobiz Japan reported regularly on the progress of what would become the EU–Japan Economic Partnership Agreement.
Stronger relations in the wake of devastation
In March 2011, Japan’s Tohoku region was rocked by a magnitude 9.0 earthquake, which triggered a devastating tsunami and a meltdown at a nuclear reactor in Fukushima. This tragic event is certainly a factor that helped the EU (which had been struggling with the European sovereign debt crisis since 2009) and Japan reach a deeper understanding of the value in having closer economic and political ties.
“The EU expressed strong solidarity with the people of Japan in the aftermath of the March 2011 disaster and bilateral political relations strengthened,” writes Moreno Bertoldi in his essay “Forty years of EU–Japan economic relations”, published in the book EU–Japan Relations, 1970–2012: From Confrontation to Global Partnership. “The two sides realised better how strong was the interdependence between the two economies and the importance of having and developing further economic ties.”
It was only a few months later, at the 10th EU–Japan Summit in May, that the scoping exercise was announced, putting the two economies on a path towards realising the EU–Japan EPA.
Helping negotiations get off the ground
At the start of 2012, Duco Delgorge — president of importer–distributor MIE PROJECT and, since 2002, vice chairman of the EBC — took over from Tommy Kullberg as EBC chair. It was a position he held until the end of 2013, which allowed him to be involved in helping to get negotiations on the EU–Japan EPA off the ground.
“The shattering events of March 2011, when the Great East Japan Earthquake and its aftermath destroyed lives and livelihoods across swathes of the country, marked a turning point for Japan, lending extraordinary poignancy and purpose to a host of initiatives to revitalise the Japanese economy,” Delgorge wrote in the introduction to the 2012 EBC white paper, Delivering Trade Potential. “So much now depends on these initiatives. The aim of this [report] … is to contribute our ideas for their success.”
In the same message, he refers to the historic announcement of the start of the scoping exercise in May 2011 — a process to which the EBC gave “detailed input” — and the approval of the European Council on 29 November 2012 that gave the European Commission the mandate to begin negotiations on an EPA.
“For forty years, the EBC has been calling on the EU and Japan to improve their mutual trade environment yet, until now, the opportunity had never been grasped,” he continues. “Every attempt at achieving a step change in EU–Japan trade, through dialogue, meetings, and summits, had met with failure. The impact of such failure was felt throughout business, not just by companies struggling to expand into overseas markets or finding promising opportunities strangled by red tape, but also by the many companies deterred from even trying. The news that leaders of the EU and Japan have finally changed all that is not just welcome — it makes sense. The EBC has much to offer to the debate on how to take Japan forward.”
On 25 March 2013, the EU and Japan announced that negotiations on the EPA would begin, and the first round took place from 15 to 19 April. Now the EBC had reason to hope that many tariff and non-tariff barriers it had long fought to see removed would begin to come down. For the next four years, the organisation would regularly provide the EU Delegation and EU-side negotiators with information and recommendations.
A reliable source of insights and information
In January 2014, Danny Risberg — CEO, and later chairman, of Philips Japan and former chair of the EBC Medical Equipment & Diagnostics Committee — took over from Delgorge as EBC chair. His time at the helm of the organisation was dominated by one goal.
“The EBC’s focus while I was chair was on getting an EU–Japan EPA in place,” he says. “We were relied on quite heavily for information about the Japanese business environment and the challenges to European firms doing business here.”
During the negotiations, the EBC white paper took on even greater importance because it became a clearly laid-out source of many of the concerns of European businesses in Japan.
“Ensuring the white paper was in line with our overall goals, and then getting it published, was crucial each year as this was the core document the EBC used in discussions with the EU leaders in Brussels and with the Japanese ministries,” says Risberg. “We also wanted to make sure everyone was equally represented, not only from a business-sector standpoint but from the positions of firms from individual EU member states.”
After more than two years of negotiations, the EBC remained determined to see the EPA come to fruition and continued to lobby for change.
In the 2015 white paper, Risberg wrote: “We are cautiously optimistic that, finally, some of the many barriers stifling growth and investment here might fall, benefitting not only individual companies but also the economy as a whole … An agreement could boost trade relations and set both economies on a path to greater prosperity. Yet none of this will happen if the agreement is too narrow, if tough issues are left unresolved, or if the final outcome fails to meet the needs of both sides. That is why we are highlighting in this report the top issues that each EBC committee insists must be resolved.”
After 18 rounds of negotiations, the EU and Japan reached a political agreement on 6 July 2017, and the text of the EPA was finally agreed in December 2017. Then the European Council authorised the signing of the agreement, which paved the way for the EU–Japan Economic Partnership Agreement to be signed on 17 July 2018 at the 25th EU–Japan Summit in Tokyo.
“The [signing] represents an important milestone in the economic relationship between the EU and Japan,” Risberg is quoted as saying in an EBC press release from 23 July 2018. “Companies of the respective regions have invested heavily and look forward to [strengthening] their presence in their respective markets.”
Welcomes, goodbyes, and thank yous
While Risberg was chair, the EBC continued to grow. In 2017, three recently established European chambers of commerce — of Greece, Spain, and the Czech Republic — became EBC members. This meant that the EBC was now the trade policy wing of a total of 18 European chambers of commerce in Japan, representing more than 2,500 firms.
It was also the time when Alison Murray, who had been serving as executive director for 20 years, decided to retire in July 2018.
In an interview with Eurobiz Japan before she stepped down, Murray delivered a serious message.
“We’re at a point where the EPA is about to be signed, and the EBC has to monitor it to make sure that it is implemented properly,” she said. “It’s very, very important, and it’s a massive task — probably a more difficult task than just identifying problems, which is what we’ve done until today. Now we have to say, ‘Is this problem being resolved or has the EPA had no impact on it?’”
She also credited the EBC’s three policy directors — Casey Sedgman (2001 to 2004), Jakob Edberg (2005 to 2009), and Bjorn Kongstad (2010 to the present) — as having been responsible over the years for many of the organisation’s successes, including the EPA.
“Without the hard work and expertise of these three people, the EBC would have achieved very little,” Murray said. “Think about it. They have worked closely with every committee, attended almost every committee meeting, lobbied the Japanese authorities on every issue in every sector, and written or edited every committee’s section of the white paper. They visit government officials frequently, establishing close relations with working-level government personnel. I really take my hat off to them.”
Also, after nearly five years as EBC chair — throughout the pivotal period of EPA negotiations — Risberg stepped down from the position in September 2018.
In October 2018, Michael Loefflad, representative director and president of DKSH Japan, became acting chair of the EBC until December when a new chair was to be elected. During his time as chairman, he was invited to sit on a Ministry of Justice committee and was directly involved in an initiative to improve the translation of Japanese legislation.
Also in October 2018, the EBC welcomed Francesco Formiconi as the new executive director. In an interview with Eurobiz Japan shortly after taking up the role, he showed that he was picking up exactly where Murray had left off.
“It’s in the DNA of the EBC to be a bell-ringer,” he said. “Whenever there’s a problem, we ring the bell and say, ‘This isn’t going the way it should.’ Now, with the framework of the EPA to refer to, we will need to ring the bell when something is not being done in accordance with the agreement, or not being interpreted appropriately.”
In a message co-authored by Loefflad and Formiconi in the 2018 white paper, they refer to the period after the EPA comes into force as being critical.
“For the EBC, this is the most important phase, because, in the end, an agreement is only as good as its implementation,” they wrote. “For EU businesses, this means that tariff reduction and removal must be completed on time; current non-tariff barriers must be lifted and not replaced by others; public procurement markets must become open and accessible; and geographical indicators and intellectual property must be respected.”
Loefflad and Formiconi are also keenly aware that the EPA is not a panacea for every one of the problems that the EBC had been fighting for in the white papers.
“The work of the EBC does not end with the EPA: a significant number of issues hindering EU businesses in Japan lie outside the scope of the agreement,” they continue. “Some of these issues are specific to the EU, but very many affect all companies, domestic and foreign, and serve only to delay new products, inflate costs, and restrict consumer choice. EBC expert committees will, therefore, continue to highlight them and make practical recommendations for how they should be resolved.”
But, with the EPA signed and set to come into force in February 2019, the EBC did take the opportunity to look inward and make some important changes to the organisation.
Formiconi strengthened the EBC’s global network by applying to become a member of the European Business Organisation Worldwide Network (EBO WWN), which represents European business interests in more than 35 markets outside the EU. The EBC officially became a member in February 2019. EBO WWN members work daily with EU delegations across the globe to support European companies of every size. In addition to advocating for European businesses in overseas markets, the EBO WWN provides a platform for EBC-like organisations to share best practices and facilitate access to European institutions.
Also, Loefflad and Formiconi oversaw a major revamp of the EBC membership structure, which was approved by the board of directors on 24 November 2018.
Under the old rules, firms had to pay fees to join specific committees. But with the new structure, they paid to become members of the EBC, which would allow them to join several committees at no extra charge. They also allow ad-hoc working groups to be formed easily. The decades-old fee structure was also updated.
“Since it was founded in 1972, the EBC has, in principle, charged every member the same fee. But now a differentiated fee structure will be implemented. This is based on the number of employees that a firm’s parent company has globally,” Bjorn Kongstad wrote in “Becoming a stronger organisation” in the January 2019 issue of Eurobiz Japan. “The EBC hopes that the new fee structure will result in more SMEs joining the organisation … They stand for growth potential and deserve to be given more attention.”
That same month, the EBC would elect a new chair who would continue in this spirit and spearhead more transformative changes at the organisation.
A historic day
The EU–Japan Economic Partnership Agreement (EPA) came into force on 1 February 2019, ushering in a new era in relations between the two economies. At the time, the EPA was the largest trade deal ever signed, covering 635 million people and nearly a third of global GDP. Many tariffs disappeared that day — on products in a wide range of sectors, including clothing, food, forestry, textiles, and wine — while others would gradually be lowered over time. A number of non-tariff barriers, in industries such as motor vehicles, medical devices, and quasi-drugs, were also reduced.
“Today is a historic day,” said then-Ambassador of the European Union to Japan Patricia Flor at a gathering on 1 February. “It’s a day for celebration.”
Ambassadors and representatives of all EU member states, along with several ministers from the Japanese government, met at the EU Delegation to Japan to commemorate the occasion.
“While elsewhere tariffs are raised, Japan and the EU bring down 90% of all of their tariffs in one day and eliminate non-tariff barriers,” Flor continued. “If you’re a farmer or a company producing chainsaws or cyber software, or [if you’re] a small business, then there are new, big opportunities opening for you today.”
In the EPA’s first full year of implementation, bilateral trade in goods increased 5.8%. EU exports to Japan increased 5.1%, most notably for products such as wine (+13.5%), dairy (+12%), and clothing (+10%). Japanese exports to the EU of automobiles, textiles, and beef increased 17%, 20%, and 35% respectively.
Clearly, businesses on both sides have benefitted from the EPA, and the agreement can be considered a major victory for the EBC.
Fitting into a new role
Just a few days before the EPA came into force, Michael Mroczek, foreign law partner at Okuno & Partners, became EBC chair, a position he continues to hold. He has led the EBC since the beginning of this new chapter in EU–Japan relations.
In “Ready to build”, which appeared in the February 2019 issue of Eurobiz Japan, Mroczek notes that the entry into force of the EPA marks the start of a time of transition for the organisation.
“This is a big change and the EBC may need to redefine itself. We need to stay actively involved in the monitoring process as the EPA is implemented, watching how the Japanese authorities are complying. We’ll need to be flexible to fit into this new role,” he said. “We also need to bear in mind the needs of our non-EU-member stakeholders. So, we should continue, as we always have, to take the voices of our members to the relevant government ministries and make sure that they are heard.”
The first test related to the monitoring of EPA implementation came shortly after the agreement entered into force. The EBC began to receive reports that Japanese authorities were requiring EU importers to give detailed information on how their products had obtained EU origin status — a requirement that did not seem to be in line with the spirit of the EPA. The EBC got in touch with the European Commission and the Japanese authorities immediately to get more information.
“On the rules of origin issue, we were working very closely with the EU Delegation and the European Commission,” Mroczek recalls. “We were able to organise a meeting for our members with the Ministry of Finance where they could explain exactly what the issues were. I thought it was great that the ministry showed interest in the issue and was willing to help bring about a resolution.”
A few days later, Japan Customs published an announcement stating that the submission of additional information on origin is only voluntary and the importer can still request preferential treatment (i.e., lower or zero duty) under the EPA. Thanks to the EBC’s fast action, the issue was resolved quickly.
More agile, more attractive
In the same Eurobiz Japan article from February 2019, Mroczek lists a few key goals for his term as chair. One of these is to modernise the EBC constitution and another is to increase the visibility of the EBC. In a year, he accomplished the first.
A new EBC constitution came into force on 20 January 2020. It introduced a number of changes, including abolishing the mandatory 60-day voting process and dissolving one of two boards of directors to help streamline decision making.
“With two boards, it was difficult sometimes to clearly understand their areas of authority — something that could lead to deadlocks,” says Mroczek. “Now we have a more agile, simpler platform, where the chamber heads can meet regularly and, along with the committees, we can concentrate on what the EBC should be focused on: advocacy.”
In addition to introducing a proxy voting system, the new constitution also officially changed some of the names and titles of positions and bodies in the organisation. For example, the chairman is now referred to as the president, the executive director is now called the chief operating officer, and the policy director is now the chief policy director.
Two months later, in March 2020, Mroczek made progress on realising his goal of greater visibility for the EBC with the launch of a new website, newsletter, and logo. The Tokyo-based digital creative agency Paradigm assisted the EBC with its communications transformation.
In “The new EBC” from the April 2020 issue of Eurobiz Japan, Paddy O’Connor, creative director at Paradigm, describes the meaning behind the new EBC logo.
“This logo communicates the idea of the EBC as a unifying organisation representing its diverse members,” he says. “The interwoven blades form a traditional Japanese umbrella pattern, and at the centre is the red sun of the Japanese flag alongside five yellow stars to connect with the EU flag.”
In addition, Mroczek oversaw the digitalisation of the EBC white paper, which was first presented to the public at an EBC Briefing on 11 November 2021, a couple of weeks before the site went live. In its new form, the digital white paper is a searchable database of advocacy issues integrated into the EBC website. Unlike the annually printed versions of the white paper, it can be updated easily and quickly.
“The burden will now be on the committees to meet often and inform us about the issues,” noted Mroczek at the briefing. “Our work will be to keep the digital white paper up to date, so that you will at any time of the year, at any time of the day, be able to see the status of every issue that interests you and that we are working on.”
Its new governance, new digital tools, and new look put the EBC in a stronger position than ever to face new and unexpected challenges.
In February 2020, Valerie Moschetti joined the EBC as its new chief operating officer to replace Francesco Formiconi.
“Since I arrived, a new constitution has been adopted, and we have a new logo and website, which will help us to improve our communications,” she said in “An advocate for European business” in the April 2020 issue of Eurobiz Japan. “What we want now is to become even more visible. We recently started EBC Briefings, which are events that will help us to raise awareness of the work of the EBC and what our committees are working on.”
She also noted that, even with the EPA in place, there are still problems facing EU businesses in Japan, so the EBC’s work of advocacy and being a strong voice for its members continues as always.
“I believe we also need to become more reactive,” she stated. “For example, when one of our committees identifies a problem, we should act immediately and in a variety of ways. It could be by sending out a press release, making a recommendation through the European delegation to the EU Commission, or organising a meeting with the ministry concerned.”
Moschetti, together with Mroczek, would soon be given the chance to practice being reactive. At the time, the coronavirus pandemic was starting to spread around the globe, closing borders and grounding planes.
Fighting actively, vocally, and effectively
At the end of March 2020, the Japanese government imposed a ban on entry and re-entry into the country. This decision left some 190,000 permanent and long-term non-Japanese residents stranded overseas. The same restrictions were not imposed on Japanese citizens. The EBC was quick to start petitioning the government to change its policy.
“The [European Economic Area] and Switzerland also have restrictions on entering the area. However, these restrictions are focusing on persons who do not have a working or residency visa for the said region,” the EBC wrote in a statement on 18 May 2020. “Consequently, Japanese nationals living in Europe under a visa can exit and enter the region in the same way as EEA and Switzerland nationals. Unfortunately, there is no reciprocity, as non-Japanese nationals holding a proper visa … are forbidden to enter or re-enter Japan.”
Over the next few months, the EBC reacted in many ways. It conducted surveys, issued statements, met with Japanese authorities, and held press conferences.
In a 23 June 2020 article in The Japan Times, following a press conference at the Foreign Correspondents’ Club of Japan in Tokyo, Mroczek is quoted as saying: “Now … [the EPA] is losing momentum because of the travel ban.” He also proposed a possible solution: “Permanent and long-term residents should be immediately let out and back again into Japan; in the second step the restriction could be lifted on business travellers and later … tourists.”
Mroczek also appeared in the foreign press at the time. A Washington Post article of 22 July 2020, titled “Japan promises to ease no-entry restrictions on foreign residents stranded abroad”, cites the results of an EBC survey.
“Michael Mroczek, chairman of the European Business Council in Japan, said a poll of 376 member companies found that 85% had been directly affected by the travel ban, while 44% had suffered financial losses.”
As pressure from the EBC and other foreign business organisations continued, the Japanese government finally relented, allowing permanent and long-term residents to re-enter Japan, starting on 1 September 2020.
However, the fight continued. But the focus turned specifically to the government’s ban on foreign non-residents and business travellers. Meetings with Japanese authorities continued and a number of joint statements on the restrictions were issued throughout 2021.
“The EBC felt a great deal of pressure from businesses — not only European firms, but also Japanese ones — who needed to get people here, such as new CEOs or specialists to conduct essential maintenance work,” says Mroczek. “We joined forces with other business organisations, such as the American Chamber of Commerce in Japan [ACCJ] and the Keidanren, and universities. And we assisted individual firms by taking them to ministries to try and have their cases heard.”
Although Japan changed its travel policy on 8 November 2021 to allow business travellers and students into the country, the hurdles for entry remained very high. Businesspeople were required to obtain a visa, Japan put limits on the number of business travellers allowed to enter the country, and new reporting requirements were imposed on sponsoring companies. This situation persisted through the winter.
In a joint statement from 3 February 2022, the EBC, the ACCJ, and the International Bankers Association of Japan continued their campaign for a complete end to all restrictions and hurdles.
“Japan’s ban on entry by business and student travellers goes considerably beyond the steps its major partners have taken and has imposed real and increasing economic and human costs,” it said. “The ban and the moratorium on the issuance of new visas have set back efforts to revive the economy and promote Japan as a destination for investments and a global financial hub, prevented Japanese and global companies alike from bringing in the talent they need, separated spouses and other family members, and stopped tens of thousands of foreign students from studying in Japan.”
After the Japanese government announced that it would open its borders and end the restrictions this year, another joint statement was issued on 10 June 2022, suggesting guidelines on how Japan should align its policies with other G7 countries.
“The issue of the travel ban has now essentially been resolved,” says Mroczek. “We fought for this actively, vocally, and effectively.”
More work, more possibilities
Looking to the future, Mroczek has another list of goals he hopes to accomplish. One is to continue with advocacy work to lower remaining non-tariff barriers to trade. He notes that many of these are “technical issues relating to specific industries”.
Another goal is to promote more widely the work of the EBC.
“I think the issue of the travel restrictions gave us the opportunity to increase our exposure,” says Mroczek. “We need to make more people, companies, and government officials aware of the EBC and the work that we are doing.”
He is also focused on increasing the number of EBC members and people who are working actively on committees. This will not only help to bolster the organisation’s finances but will give the EBC greater clarity on the issues affecting European businesses in Japan.
“With more members, we can increase the number of possibilities available to us,” Mroczek states.
For 50 years, the EBC has grown and evolved. It has won many small battles for firms in certain industries and a major victory for all its members with the EU–Japan EPA. Through it all, the organisation has spoken with one voice and with one aim: to promote an impediment-free environment for European businesses in Japan. That will surely continue over the years to come.
This is a year to remember the EBC’s milestones, pay tribute to its dedicated leaders and members, and to celebrate five decades of accomplishments. Mroczek hopes to have an in-person gathering to mark the anniversary.
Former chairs are eager to offer their best to the EBC on this special occasion.
“Happy 50th anniversary to the EBC and kampai to the next 50,” says Isabelle Hupperts, chair from 1999 to 2002. “It is only thanks to the determination and perseverance of everyone involved that European businesses in Japan are here to stay.”
Richard Collasse, chair from 2002 to 2009, says: “The grandfathers of our European chambers of commerce were smart enough to understand that each of them on their own could not be powerful enough to put pressure on the Japanese government, so they decided to create this EBC. I think we owe our thanks to these people 50 years ago for making that decision, which reflects what Europe is.”
A representative for the EBC’s most longstanding partner in Japan has also passed along their best wishes for this major milestone.
“Congratulations to the EBC on its 50th anniversary,” says Haitze Siemers, chargé d’affaires at the Delegation of the European Union in Japan. “We are grateful for the decades of input and close cooperation from the EBC, its committees, and all its members. We look forward to further strengthening our partnership with Japan in the coming years together with the European business community here.”