Execs call for legal reform aimed at freeing the market

Japan’s legal system should be drastically reformed in order to free up the nation’s market, make it transparent and put it in harmony with international standards, according to a report released Jan. 22 by the Japan Association of Corporate Executives (Keizai Doyukai).The report lists a number of revisions to the nation’s commercial law that business executives see as necessary, including the splitting up of Japanese companies, the creation of holding companies and the introduction of stock options, all of which are currently difficult to implement due to a lack of clear legal guidelines. The report also states that the trial process for civil cases in Japan takes far too long, and this despite the increasing significance of the judicial system amid the ongoing effort to deregulate the economy and create new rules that allow for greater competition.Speaking at a news conference, Keizai Doyukai officials said Japanese courts are not working effectively as dispute settlement bodies. It’s a claim they say is borne out by the fact that the average civil case requires 36.8 months before a high court decision is reached.As one way to speed up the trial process, the report calls for an increase in the number of judicial professionals. Last year, 730 people passed the state law examination, but the officials said the number should be raised to 1,500 at least.The report suggests the creation of a system that allows experienced business executives and university professors to work as “specialist judges” empowered to make legal judgments in specified sectors after receiving certain training. Calling for the introduction of a stock option system at companies, officials described it as an effective means of incentive for corporate executives and employees.