Project for a Reform of the Contract Law in Japan and Its Impact on Franchise Agreements
12 Pages Posted: 14 Mar 2014
Date Written: March 12, 2014
Abstract
The reform of the contract law has been discussed in Japan since 2006, first as a project of private group of academics, followed by the official legislative process at the Legislative Council of the Ministry of Justice. From the Interim Report of the Council published in February 2013, one can foresee the likely outcome of the reform, which will be drafted into a bill to be submitted to the Diet in 2015. The reform will affect the practice of franchising significantly, because franchising is a business organization based on a set of carefully drafted contractual provisions. Unfortunately, the proposals included in the Interim Report do not pay sufficient attention to such practice of well-drafted contracts and could subject the practice of franchising to the risks of reducing the discipline over franchise networks through the enforcement of the franchise agreement. Further considerations about the optimal degree of predictability of courts' interventions is strongly required.
Keywords: Franchising, contract law, law reform, Japanese law
JEL Classification: K12
Suggested Citation: Suggested Citation