TREATY OF FRIENDSHIP, COMMERCE, AND NAVIGATION WITH JAPAN, AND PROTOCOL, RELATING THERETO
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Collection:
Document Number (FOIA) /ESDN (CREST):
CIA-RDP58-00453R000100010004-0
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RIFPUB
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K
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Document Creation Date:
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Publication Date:
June 27, 1953
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83D CONGRESS
1st Session
EXECUTIVB
0
TREATY OF FRIENDSHIP, COMMERCE, AND NAVIGATION
WITH JAPAN, AND PROTOCOL RELATING THERETO
MESSAGE
THE PRESIDENT OF THE UNITED STATES
A TREATY OF FRIENDSHIP, COMMERCE, AND NAVIGATION
BETWEEN THE UNITED STATES OF AMERICA AND JAPAN,
TOGETHER WITH A PROTOCOL RELATING THERETO, SIGNED
AT TOKYO ON APRIL 2, 1953
JuNs 27,1953.-The treaty was read the first time and the injunction of secrecy
was removed therefrom, and together with all accompanying papers was
referred to the Committee on Foreign Relations and ordered to be printed for
the use of the Senate
THE WHITE HouSE, June 27, 1953.
To the Senate of the United States:
With a view to receiving the advice and consent of the Senate to
ratification, I transmit herewith a treaty of friendship, commerce,
and navigation between the United States of America and Japan,
together with a protocol relating thereto, signed at Tokyo on April 2,
1953.
I transmit also, for the information of the Senate, a report by the
Secretary of State with respect to the treaty.
DWIGHT D. EISENHOWER.
(Enclosures: (1) Report of the Secretary of State; (2) treaty of
friendship, commerce and navigation, with protocol, signed at Tokyo,
April 2, 1953.)
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DEPARTMENT OF STATE,
Washington, June 22, 1953.
The PRESIDENT,
The White House:
The undersigned, the Secretary of State, has the honor to submit to
the President, with a view to its transmission to the Senate to receive
the advice and consent of that body to ratification, if the President
approve thereof, a treaty of friendship, commerce, and navigation
between the United States of America and Japan, together with a
protocol relating thereto, "signed at Tokyo on April 2, 1953.
This treaty places commercial relations between the United States
and Japan on a normal bilateral treaty basis for the first time since
the termination on January 26, 1940, of the treaty of commerce and
navigation, signed at Washington on February 21, 1911 (37 Stat. 1504).
It was envisaged in article 12 of the Treaty of Peace with Japan, which
contains, in addition to temporary commercial arrangements, a declar-
ation by Japan of its readiness to enter into negotiations for the con-
clusion, with each of the Allied Powers so desiring, of treaties or agree-
ments to place their respective "trading, maritime and other commer-
cial relations on a stable and friendly basis."
The present treaty is a comprehensive instrument which expresses
the common faith of the two countries in liberal principles and is de-
signed to provide an effective basis for the development of business,
trade, and other commercial relationships. It is the first treaty of
this type which Japan has negotiated with any country since the end
of World War II and may be regarded as a significant step in the
strengthening of cordial relations between the United States and
Japan.
In common with other treaties of friendship, commerce, and naviga-
tion entered into by the United States in recent years, the new treaty
deals in considerable detail with a wide range of subject matter. In
general, each of the two Governments (1) agrees to accord, within its
territories, to citizens and corporations of the other country treatment
no less favorable than it accords to its own citizens and corporations
with respect to normal commercial and industrial pursuits; (2) affirms
its adherence to the principles of nondiscriminatory treatment of
trade and shipping; (3) formally endorses standards regarding the
protection of persons and their property and interests that reflect the
most enlightened constitutional principles; and (4) recognizes the
need for special attention to the problems of stimulating the flow of
private capital investment. Specifically, the provisions of the treaty
fall into nine broad categories: (1) entry, travel and residence;
(2) basic personal freedoms; (3) guaranties with respect to property
rights; (4) the conduct and control of business enterprises; (5) taxa-
tion; (6) exchange restrictions; (7) the exchange of goods; (8) naviga-
tion; and (9) exceptions, territorial applicability, and miscellaneous
provisions. In the formulation of the provisions of the treaty special
attention has been given to the type of assurances which American
businessmen and investors are understood to regard as useful and
desirable.
The new treaty with Japan resembles most nearly (a) the treaty of
friendship, commerce, and economic development with Uruguay,
signed at Montevideo on November 23, 1949 (S. Ex. D, 81st Cong.,
2d sess.), the treaty of friendship, commerce, and navigation with
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TREATY WITH JAPAN AD PROTOCOL RELATING THERETO
Ireland, signed at Dublin on January 21, 1)50 (S. Ex. H, 81st Cong,
2d sess.), both of which treaties have received Senate advice and con-
sent to ratification; and (b) the treaties of friendship, commerce, and
navigation with Israel, signed at Washington on August 23, 1951
(S. Ex. R, 82d Cong., 1st sess.), with Greece, signed at Athens August
3, 1951 (S. Ex. J, 82d Cong., 2d sess.), and with Denmark, sI'gned
at Copenhagen October 1, 1951 (S. Ex. I, 82d Cong., 2d sess., whiclj
treaties were submitted to the Senate on October 18, 1951, January 30,
1952, and January 29, 1952, respectively.
There are several provisions in the treaty with Japan, however,
which are not found in other treaties, as follows: (1) A clause provid-
ing for visa privileges for persons desiring to enter either country for
the purpose of developing the operations of a business enterprise in
which they have a substantial investment (art. J, par. 1 (b)); (2) a
clause assuring that if new limitations are imposed upon the extent
to which aliens are accorded national treatment with respect to
carrying on certain activities reserved from the "national treatment"
rule, such limitations shall not be applied against enterprises which
are engaged in such activities at the time the new limitations are
adopted and which are owned or controlled by nationals and companies
of the other country (art. VII, par. 2, second sentence); (3) a provision
designed to further the United States policy of favoring the broad
dissemination of nonsecurity technological information (art. V, par. 2);
(4) a provision designed to discourage certain deceptive marking
practices in international trade (protocol, par. 7); and (5) a para-
graph designed to assure the maintenance of a free market in the field
of marine insurance (art. XV, par. 3). The provision indicated under
(1) above was authorized by section 101 (a) (15) (E) (ii) of the new
Immigration and Nationality Act. The provision indicated under
(5) above was recommended by the Association of Marine Under-
writers of the United States.
The provision on the application of quantitative trade restrictions
(art. XIV, par. 3) has been restated along the lines of article XII,
paragraph 3, of the treaty of amity and economic relations with
Ethiopia (S. Ex. F, 82d Cong., 2d sess.) in the interests of greater
clarity and adequacy.
As has been done in similar treaties with other countries, certain
changes in the standard language have been made by way of clarifi-
cation or accommodation and various adjustments of substance have
been included to meet special circumstances existing with respect to
the foreign government. Most of such changes in the present treaty
are included in the protocol (in pars. 3 through 6 8 through 10, and
13 through 15), which protocol is considered an integral part of the
treaty. Further, it will be noted that in paragraph 1 of article IX of
the treaty the provision on real property is confined to lease rights
with respect to property needed for the conduct of activities permitted
by the treaty and does not deal with ownership rights; and the second
sentence of paragraph 3 of article XXI has been restated so that
Japan will be entitled to concessions granted by the United States to
other countries parties to the General Agreement on Tariffs and Trade
in the event of continued Japanese nonparticipation in that agreement
for reasons beyond Japanese control, and in the event that the General
Agreement on Tariffs and Trade remains in its present form. These
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changes are, on the whole, of secondary consequence and, though
deviations from the standard treaty, are founded on precedents.
Provision is made in the treaty for its entry into force 1 month
after the day of exchange of ratifications and for its continuance in
force for a period of 10 years from that day and indefinitely thereafter,
subject to termination on 1 year's written notice by either Govern-
ment to the other Government.
Respectfully submitted.
JOHN FOSTER DULLES.
(Enclosure: Treaty of friendship, commerce and navigation, with
protocol, signed at Tokyo April 2, 1.953.)
TREATY OF FRIENDSHIP, COMMERCE, AND NAVIGATION
BETWEEN THE UNITED STATES OF AMERICA AND
JAPAN
The United States of America and Japan, desirous of strengthening
the bonds of peace and friendship traditionally existing between them
and of encouraging closer economic and cultural relations between
their peoples, and being cognizant of the contributions which may
be made toward these ends by arrangements promoting mutually
advantageous commercial intercourse, encouraging mutually bene-
ficial investments, and establishing mutual rights and privileges,
have resolved to conclude a Treaty of Friendship, Commerce, and
Navigation, based in general upon the principles of national and of
most-favored-nation treatment unconditionally accorded, and for that
purpose have appointed as their Plenipotentiaries,
The United States of America:
Robert Murphy, Ambassador Extraordinary and Pleni-
potentiary of the United States of America to Japan, and
Japan:
Katsuo Okazaki, Minister for Foreign Affairs of Japan,
Who, having communicated to each other their full powers found to
be in due form, have agreed upon the following Articles:
1. Nationals of either Party shall be permitted to enter the ter-
ritories of the other Party and to remain therein: (a) for the purpose
of carrying on trade between the territories of the two Parties and
engaging in related commercial activities; (b) for the purpose of
developing and directing the operations of an enterprise in which they
have invested, or in which they are actively in the process of investing,
a substantial amount of capital; and (c) for other purposes subject
to the laws relating to the entry and sojourn of aliens.
2. Nationals of either Party, within the territories of the other
Party, shall be permitted: (a) to travel therein freely, and to reside
at places of their choice; (b) to enjoy liberty of conscience; (c) to
hold both private and public religious services; (d) to gather and to
transmit material for dissemination to the public abroad; and (c) to
communicate with other persons inside and outside such territories
by mail, telegraph and other means open to general public use.
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TREATY WITH JAPAN AND PROTOCOL RRLATING THERETO
3. The provisions of the present Article shall be subject to the
right of either Party to apply measures that are necessary to maintain
public order and protect the public health, morals and safety.
ARTICLE II
1. Nationals of either Party within the territories of the other
Party shall be free from unlawful molestations of every kind, and
shall receive the most constant protection and security, in no case
less than that required by international law.
2. If, within the territories of either Party, a national of the other
Party is taken into custody, the nearest consular representative of
his country shall on the demand of such national be immediately
notified. Such national shall: (a) receive reasonable and humane
treatment; (b) be formally and immediately informed of the accusa-
tions against him; (c) be brought to trial as promptly as is consistent
with the proper preparation of his defense; and (d) enjoy all means
reasonably necessary to his defense, including the services of com-
petent counsel of his choice.
ARTICLE III
1. Nationals of either Party shall be accorded national treatment
in the application of laws and regulations within the territories of the
other Party that establish a pecuniary compensation, or other bene-
fit or service, on account of disease, injury or death arising out of and
in the course of employment or due to the nature of employment.
2. In addition to the rights and privileges provided in paragraph 1
of the present Article, nationals of either Party shall, within the
territories of the other Party, be accorded national treatment in the
application of laws and regulations establishing compulsory systems
of social security, under which benefits are paid without an individual
test of financial need: (a) against loss of wages or earnings due to old
age, unemployment, sickness or disability, or (b) against loss of
financial support due to the death of father, husband or other person
on whom such support had depended.
ARTICLE IV
1. Nationals and companies of either Party shall be accorded
national treatment and most-favored-nation treatment with respect
to access to the courts of justice and to administrative tribunals and
agencies within the territories of the other Party, in all degrees of
jurisdiction, both in pursuit and in defense of their rights. It is
understood that companies of either Party not engaged in activities
within the territories of the other Party shall enjoy such access therein
without registration or similar requirements.
2. Contracts entered into between nationals and companies of
either Party and nationals and companies of the other Party, that
provide for the settlement by arbitration of controversies, shall not be
deemed unenforceable within the territories of such other Party
merely on the grounds that the place designated for the arbitration
proceedings is outside such territories or that the nationality of one
or more of the arbitrators is not that of such other Party. Awards
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TREATY WITH JAPAN AND PROTOCOL RELATING THERETO
duly rendered pursuant to any such contracts, which are final and
enforceable under the laws of the place where rendered, shall be
deemed conclusive in enforcement proceedings brought before the
courts of competent jurisdiction of either Party,, and shall be entitled
to be declared enforceable by such courts, except where found contrary
to public policy. When so declared, such awards shall be entitled to
privileges and measures of enforcement appertaining to awards ren-
dered locally. It is understood, however, that awards rendered out-
side the United States of America shall be entitled in any court in any
State thereof only to the same measure of recognition as awards
rendered in other States thereof.
1. Neither Party shall take unreasonable or discriminatory measures
that would impair the legally acquired rights or interests within its
territories of nationals and companies of the other Party in the enter-
prises which they have established, in their capital, or in the skills,
arts or technology which they have supplied; nor shall either Party
unreasonably impede nationals and companies of the other Party from
obtaining on equitable terms the capital, skills, arts and technology
it needs for its economic development.
2. The Parties undertake to cooperate in furthering the interchange
and use of scientific and technical knowledge, particularly in the
interests of increasing productivity and improving standards of living
within their respective territories.
ART[CLE VI
1. Property of nationals and companies of either Party shall re-
ceive the most constant protection and security within the territories
of the other Party.
2. The dwellings, offices, warehouses, factories and other premises
of nationals and companies of either Party located within the terri-
tories of the other Party shall not be subject to unlawful entry or
molestation. Official searches and examinations of such premises and
their contents, when necessary, shall be made only according to law
and with careful regard for the convenience of the occupants and the
conduct of business.
3. Property of nationals and companies of either Party shall not
be taken within the territories of the other Party except for a public
purpose, nor shall it be taken witliout the prompt payment of just
compensation. Such compensation shall be in an effectively realizable
form and shall represent the full equivalent of the property taken; and
adequate provision shall have been made at or prior to the time of
taking for the determination and payment thereof.
4. Nationals and companies of either Party shall in no case be
accorded, within the territories of the other Party, less than national
treatment and most-favored-nation treatment with respect to the
matters set forth in paragraphs 2 and 3 of the present Article. More-
over, enterprises in which nationals and companies of either Party have
a substantial interest shall be accorded, within the territories of the
relating treatment t thetaking of sprivately owned
other Party,
tr treatment in all less
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enterprises into public ownership and to the placing of such enterprises:
under public control.
ARTICLE VII
1. Nationals and companies of either Party shall be accorded
national treatment with respect to engaging in all types of commer-
cial, industrial, financial and other business activities within the ter-
ritories of the other Party, whether directly or by agent or through
the medium of any form of lawful juridical entity. Accordingly, such
nationals and companies shall be permitted within such territories::
(a) to establish and maintain branches, agencies, offices, factories
and other establishments appropriate to the conduct of their busi-
ness; (b) to organize companies under the general company laws of
such other Party, and to acquire majority interests in companies of
such other Party; and (c) to control and manage enterprises which
they have established or acquired. Moreover, enterprises which they
control, whether in the form of individual propprietorships, com-
panies or otherwise, shall, in all that relates to the conduct of the
activities thereof, be accorded treatment no less favorable than that
accorded like enterprises controlled by nationals and companies of
such other Party.
2. Each Party reserves the right to limit the extent to which aliens
may within its territories establish, acquire interests in, or carry on
public utilities enterprises or enterprises engaged in shipbuilding, air or
water transport, banking involving depository or fiduciary functions,
or the exploitation of land or other natural resources. However,
new limitations imposed by either Party upon the extent to which:..
aliens are accorded national treatment, with respect to carrying on
such activities within its territories, shall not be applied as against
enterprises which are engaged in such activities therein at the time such
new limitations are adopted and which are owned or controlled by
nationals and companies of the other Party. Moreover, neither Party.
shall deny to transportation, communications and banking companies,
of the other Party the right to maintain branches and agencies to,
perform functions necessary for essentially international operations
in which they are permitted to engage.
3. The provisions of paragraph 1 of the present Article shall not
prevent either Party from prescribing special formalities in connection
with the establishment of alien-controlled enterprises within its
territories; but such formalities may not impair the substance of the
rights set forth in said paragraph.
4. Nationals and companies of either Party, as well as enterprises
controlled by such nationals and companies, shall in any event be
accorded most-favored-nation treatment with reference to the matters
treated in the present Article.
1. Nationals and companies of either Party shall be permitted to
engage, within the territories of the other Party, accountants and
other technical experts, executive personnel, attorneys, agents and
other specialists of their choice. Moreover, such nationals and
companies shall be permitted to engage accountants and other tech-
nical experts regardless of the extent to which they may have qualified
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for the practice of a profession within the territories of such other
Party, for the particular purpose of making examinations, audits and
technical investigations exclusively for, and rendering reports to,
such nationals and companies in connection with the planning and
operation of their enterprises, and enterprises in which they have a
financial interest, within such territories.
2. Nationals of either Party shall not be barred from practicing
the professions within the territories of the other Party merely by
reason of their alienage; but they shall be permitted to engage in
professional activities therein upon compliance with the requirements
regarding qualifications, residence and competence that are applicable
to nationals of such other Party.
3. Nationals and companies of either Party shall be accorded na-
tional treatment and most-favored-nation treatment with respect to
engaging in scientific, educational, religious and philanthropic activ-
ities within the territories of the other Party, and shall be accorded
the right to form associations for that purpose under the laws of such
other Party.
1. Nationals and companies of either Party shall be accorded
within the territories of the other Party: (a) national treatment with
respect to leasing land, buildings and other immovable property
appropriate to the conduct of activities in which they are permitted
to engage pursuant to Articles VII and VIII and for residential
purposes, and with respect to occupying and using such property;
and (b) other rights in immovable property permitted by the applicable
laws of the other Party.
2. Nationals and companies of either Party shall be accorded
within the territories of the other Party national treatment and most-
favored-nation treatment with respect to acquiring, by purchase,
lease, or otherwise, and with respect to owning and possessing, mov-
able property of all kinds, both tangible and intangible. However,
either Party may impose restrictions on alien ownership of materials
dangerous from the standpoint of public safety and alien ownership
of interests in enterprises carrying on the activities listed in the first
sentence of paragraph 2 of Article VII, but only to the extent that
this can be done without impairing the rights and privileges secured
by Article VII or by other provisions of the present Treaty.
3. Nationals and companies of either Party shall be permitted freely
to dispose of property within the territories of the other Party with
respect to the acquisition of which through testate or intestate succes-
sion their alienage has prevented them from receiving national treat-
ment, and they shall be permitted a term of at least five years in
which to effect such disposition.
4. Nationals and companies of either Party shall be accorded
within the territories of the other Party national treatment and
most-favored-nation treatment with respect to disposing of property
of all kinds.
Nationals and companies of either Party shall be accorded, within
the territories of the other Party, national treatment and most-favored-
nation treatment with respect to obtaining and maintaining patents
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of invention, and with respect to rights in trade marks, trade names,
trade labels and industrial property of every kind.
1. Nationals of either Party residing within the territories of the
other Party, and nationals and companies of either Party engaged
in trade or other gainful pursuit or in scientific, educational, religious
or philanthropic activities within the territories of the other Party,
shall not be subject to the payment of taxes, fees or charges imposed
upon or applied to income, capital, transactions, activities or any
other object, or to requirements with respect to the levy and collec-
tion thereof, within the territories of such other Party, more burden-
some than those borne by nationals and companies of such other
Party.
2. With respect to nationals of either Party who are neither resident
nor engaged in trade or other gainful pursuit within the territories
of the other Party, and with respect to companies of either Party
which are not engaged in trade or other gainful pursuit within the
territories of the other Party, it shall be the aim of such other Party
to apply in general the principle set forth in paragraph 1 of the present
Article.
3. Nationals and companies of either Party shall in no case be
subject, within the territories of the other Party, to the payment of
taxes, fees or charges imposed upon or applied to income, capital,
transactions, activities or any other object, or to requirements with
respect to the levy and collection thereof, snore burdensome than
those borne by nationals, residents and companies of any third
country.
4. In the case of companies of either Party engaged in trade or
other gainful pursuit within the territories of the other Party, and
in the case of nationals of either Party engaged in trade or other
gainful pursuit within the territories of the other Party but not resi-
dent therein, such other Party shall not impose or apply any tax,
fee or charge upon any income, capital or other basis in excess of that
reasonably allocable or apportionable to its territories, nor grant
deductions and exemptions less than those reasonably allocable or
apportionable to its territories. A comparable rule shall appl r also
in the ease of companies organized and operated exclusively for
scientific, educational, religious or philanthropic, purposes.
5. Each Party reserves the right to: (a) extend specific tax advan-
tages on the basis of reciprocity; (b) accord special tax advantages by
virtue of agreements for the avoidance of double taxation or the mutual
protection of revenue; and (c) accord to its own nationals and to
residents of contiguous countries more favorable exemptions of a
personal nature with respect to income taxes and inheritance taxes
than are accorded to other non-resident persons.
1. Nationals and companies of either Party shall be accorded by the
other Party national treatment and most-favored-nation treatment
with respect to payments, remittances and transfers of funds or
financial instruments between the territories of the two Parties as
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well as between t:he territories of such other Party arid of any third
country.
2. Neither Party shall impose exchange restrictions as defined in
paragraph 5 of the present Article except to the extent accessary to
prevent its monetary reserves from falling to a very low level or to
effect a moderate increase in very lcw monetary reserv,2s. Tt is under-
stood that the provisions of the present Article do not alter the obli-
gations either Party may have to the International Monetary Fund
or preclude imposition of Particular restrictions whenever the Fund
specifically authorizes or requests Z Party to impose such particular
restrictions.
3. If either Party imposes exchange restrictions in accordance with
paragraph 2 above, it shall, after making whatever provision may be
necessary to assure the availability of foreign exchange for goods and
services essential to the'hcalth and welfare of its people, make, -reason-
able provision for the withdrawal, in foreign exchange in the currency
of the other Party, of : (a) the compensation referred to in Article VI,
paragraph 3, of the present Treaty, (b) earnings, whether in the form
of salaries, interest, dividends, commissions, royalties, payments for
technical services, or otherwise, and (c) amounts for amortization of
loans, depreciation of direct investments, and capital transfers, giving
consideration to special needs for other transactions. If more than
one rate of exchange is in force, the rate applicable to such withdrawals
shall be a rate which is specifically approved by t'ae International
Monetary Fund for such transactions or, in the absence of a rate so
approved, an effective rate which, inclusive of any taxes or surcharges
on exchange transfers, is just and reasonable.
4. Exchange restrictions shall not be imposed by either Party in a
manner unnecessarily detrimental or arbitrarily discriminatory to the
claims, investments, transport, trade, and other interests of the na-
tionals and companies of the other Party, nor to the competitive
position thereof.
5. The term "exchange restrictions" as used in the present Article
includes all restrictions, regulations, charges, taxes, or other require-
ments imposed by either Party which burden or interfere with pay-
ments, remittances, or transfers of funds or of financial instruments
between the territories of the two Parties.
ARTICLE XIII
Commercial travelers representing nationals and companies of either
Party engaged in business within the territories thereof shall, upon
their entry into and departure from the territories of the other Party
and during their sojourn therein, be accorded most-favored-nation
treatment in respect of the customs and other matters, including,
subject to the exceptions in paragraph 5 of Article XI, taxes and
charges applicable to them, their samples and the taking of orders,
and regulations governing the exercise of their functions.
ARTICLE XIV
1. Each Party shall accord most-favored-nation treatment to
products of the other Party, from whatever place and by whatever
type of carrier arriving, and to products destined for exportation
to the territories of such other Party, by whatever route and by
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whatever type of carrier, with respect to customs duties and charges
of any kind imposed on or in connection with importation or exporta-
tion or imposed on the international transfer of payments for imports
or exports, and with respect to the method of levying such duties
and charges, and with respect to all rules and formalities in connection
with importation and explortation.
2. Neither Party shall impose restrictions or prohibitions on the
importation of any product of the other Party, or on the exportation
of any product to the territories of the other Party, unless the importa-
tion. of the like product of, or the exportation of the like product to,
all third countries is similarly restricted or prohibited.
:3. If either Party imposes quantitative restrictions on the importa-
tion or exportation of any product in which the other Party has an
important interest:
(a) It shall as a general rule give prior public notice of the
total amount of the product, by quantity or value, that may be
imported or exported during a specified period, and of any change
in. such amount or period; and
(b) If it makes allotments to any third country, it shall afford
such other Party a share proportionate to the amount of the
product, by quantity or value, supplied by or to it during a
previous representative period, due consideration being given to
any special factors affecting the trade in such product.
4. Either Party may impose prohibitions or restrictions on sanitary
or other customary grounds of a noncommercial nature, or in the
interest of preventing deceptive or unfair practices, provided such
prohibitions or restrictions do not arbitrarily discriminate against
the commerce of the other Party.
5. Nationals and companies of either Party shall be accorded
national treatment and most-favored-nation treatment by the
other Party with respect to all matters relating to importation and
exportation.
6. The provisions of the present Article shall not apply to advan-
tages accorded by either Party:
(a) to products of its national fisheries;
(b) to adjacent countries in order to facilitate frontier traffic;
or
(c) by virtue of a customs union or free-trade area of which
it may become a member, so long as it informs the other Party
of its plans and affords such other Party adequate opportunity
for consultation.
7. Notwithstanding the provisions of paragraphs 2 and 3 (b)
of the present Article, a Party may apply restrictions or controls
on importation and exportation of goods that have effect equivalent
to, or which are necessary to make effective, exchange restrictions
applied pursuant to Article XII. However, such restrictions or
controls shall depart no more than- necessary from the aforesaid
paragraphs and shall be conformable with a policy deigned to pro-
mote the maximum development of nondiscriminatory foreign trade
and to expedite the attainment both of a balance-of-payments posi-
tion and of monetary reserves which will obviate the necessity of
such restrictions.
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12 TREATY WITH JAPAN AND PROTOCOL RELATING THERETO
1. Each Party shall promptly publish laws, regulations and ad-
ministrative rulings of general application pertaining to rates of
duty, taxes or other charges, to the classification of articles for cus-
toms purposes, and to requirements or restrictions on imports and
exports or the transfer of payments therefor, or affecting their sale,
distribution or use; and shall administer such laws, regulations and
rulings in a uniform, impartial and reasonable manner. As a general
practice, new administrative requirements or restrictions affecting
imports, with the exception of those imposed on sanitary, grounds or
for reasons of public safety, shall not go into effect before the expira-
tion of 30 days after publication, or alternatively, shall not apply to
products en route at time of publication.
2. Each Party shall provide an appeals procedure under which
nationals and companies of the other Party, and importers of prod-
ucts of such other Party, shall be able to obtain prompt and impartial
review, and correction when warranted, of administrative action re-
lating to customs matters, including the imposition of fines and
penalties, confiscations, and rulings on questions of customs classi-
fication and valuation by the administrative authorities. Penalties
imposed for infractions of the customs and shipping laws and regu-
lations concerning documentation shall, in cases resulting from
clerical errors or when good faith can be demonstrated, be no greater
than necessary to serve merely as a warning.
3. Neither Party shall impose any measure of a discriminatory
nature that hinders or prevents the importer or exporter of products
of either country from obtaining marine insurance on such products
in companies of either Party. The present paragraph is subject to
the provsions of Article XII.
1. Products of either Party shall be accorded, within the territories
of the other Party, national treatment and most-favored-nation treat-
ment in all matters affecting internal taxation, sale, distribution,
storage and use.
2. Articles produced by nationals and companies of either Party
within the territories of the other Party, or by companies of the latter
Party controlled by such nationals and companies, shall be accorded
therein treatment no less favorable than that accorded to like articles
of national origin by whatever person or company produced, in all
matters affecting exportation, taxation, sale, distribution, storage
and use.
ARTICLE XVII
1. Each Party undertakes (a) that enterprises owned or controlled
by its Government, and that monopolies or agencies granted exclusive
or special privileges within its territories, shall make their purchases
and sales involving either imports or exports affecting the commerce
of the other Party solely in accordance with commercial considera-
tions, including price, quality, availability, marketability, transporta-
tion and other conditions of purchase or sale; and (b) that the
nationals, companies and commerce of such other Party shall be
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TREATY WITH JAPAN AND PROTOCOL RELATING THERETO 13
afforded adequate opportunity, in accordance with customary busi-
ness practice, to compete for participation in such purchases and sales.
2. Each Party shall accord to the nationals, companies and com-
merce of the other Party fair and equitable treatment, as compared
with that accorded to the nationals, companies and commerce of any
third country, with respect to: (a) the governmental purchase of
supplies, (b) the awarding of concessions and other government con-
tracts, and (c) the sale of any service sold by the Government or by
any monopoly or agency granted exclusive or special privileges.
1. The two Parties agree that business practices which restrain
competition, limit access to markets or foster monopolistic control,
and which are engaged in or made effective by one or more private or
public commercial enterprises or by combination, agreement or other
arrangement among such enterprises, may have harmful effects upon
commerce between their respective territories. Accordingly, each
Party agrees upon the request of the other Party to consult with
respect to any such practices and to take such measures as it deems
appropriate with a view to eliminating such harmful effects.
2. No enterprise of either Party, including corporations, associa-
tions, and government agencies and instrumentalities, which is pub-
licly owned or controlled shall, if it engages in commercial, industrial,
shipping or other business activities within the territories of the other
Party, claim or enjoy, either for itself or for its property, immunity
therein from taxation, suit, execution of judgment or other liability to
which privately owned and controlled enterprises are subject therein.
1. Between the territories of the two Parties there shall be freedom
of commerce and navigation.
2. Vessels under the flag of either Party, and carrying the papers
required by its law in proof of nationality, shall be deemed to be
vessels of that Party both on the high seas and within the ports,
places and waters of the other Party.
3. Vessels of either Party shall have liberty, on equal terms with
vessels of the other Party and on equal terms with vessels of any
third country, to come with their cargoes to all ports, places and
waters of such other Party open to foreign commerce and navigation.
Such vessels and cargoes shall in all respects be accorded national
treatment and most-favored-nation treatment within the ports, places
and waters of such other Party.
4. Vessels of either Party shall be accorded national treatment and
most-favored-nation treatment by the other Party with respect to the
right to carry all products that may be carried by vessel to or from
the territories of such other Party; and such products shall be accorded
treatment no less favorable than that accorded to like products
carried in vessels of such other Party, with respect to: (a) duties and
charges of all kinds, (b) the administration of the customs, and (c)
bounties, drawbacks and other privileges of this nature.
5. Vessels of either Party, in case of shipwreck, stranding, or of
being forced to put into the ports, places and waters of the other
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14 TREATY WITH JAPAN AND PROTOCOL RELATING THERETO
Party, whether or not open to foreign commerce and navigation, shall
enjoy the same assistance and protection as are in like cases enjoyed
by vessels of such other Party or of any third country, and shall not
be subject to any duties or charges other than those which would
be payable in like circumstances by vessels of such other Party or
of any third country. The cargoes of such vessels of either Party
and all articles salvaged from them shall be exempt from customs
duties unless entered for consumption within the territories of the
other Party; but articles not entered for consumption may be subject
to measures for the protection of the revenue pending their exit from
the country.
6. Notwithstanding any other provision of the present Treaty, each
Party may reserve exclusive rights and privileges to its own vessels
with respect to the coasting trade, national fisheries and inland naviga-
tion, or may admit foreign vessels thereto only on a reciprocity basis.
7. The term "vessels", as used herein, means all types of vessels,
whether privately owned or operated, or publicly owned or operated;
but this term does not, except with reference to paragraphs 2 and 5 of
the present Article, include fishing vessels or vessels of war.
There shall be freedom of transit through the territories of each
Party by the routes most convenient for international transit:
(a) for nationals of the other Party, together with their baggage;
(b) for other persons, together with their baggage, en route
to or from the territories of such other Party; and
(c) for products of any origin en route to or from the territories
of such other Party.
Such persons and things in transit shall be exempt from customs duties,
from duties imposed by reason of transit, and from unreasonable
charges and requirements; and shall be free from unnecessary delays
and restrictions. They shall, however, be subject to measures referred
to in paragraph 3 of Article I, and to nondiscriminatory regulations
necessary to prevent abuse of the transit privilege.
1. The present Treaty shall not preclude the application of measures:
(a) regulating the importation or exportation of gold or silver;
(b) relating to fissionable materials, to radioactive by-products
of the utilization or processing thereof, or to materials that are
the source of fissionable materials ;
(c) regulating the production of or traffic in arms, ammunition
and implements of war, or traffic in other materials carried on
directly or indirectly for the purpose of supplying a military
establishment;
(d) necessary to fulfill the obligations of a Party for the main-
tenance or restoration of international peace and security, or
necessary to protect its essential security interests; and
(e) denying to any company in the ownership or direction of
which nationals of any third country or countries have directly
or indirectly the controlling interest, the advantages of the present
Treaty, except with respect to recognition of juridical status and
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TREATY WITH JAPAN AND PROTOCOL RELATING THERETO
15
with respect to access to courts of justice and to administrative
tribunals and agencies.
2. The most-favored-nation provisions of the present Treaty relating
to the treatment of goods shall not apply to advantages accorded by
the United States of America or its Territories and possessions to one
another, to the Republic of Cuba, to the Republic of the Philippines,
to the Trust Territory of the Pacific Islands or to the Panama Canal
Zone.
3. The provisions of the present Treaty relating to the treatment of
goods shall not preclude action by either Party which is requiied or
specifically permitted by the Genera] Agreement on Tariffs and Trade
during such time as such Party is a contracting party to the General
Agreement. Moreover, either Party may withhold advantages nego-
tiated under the aforesaid Agreement from those countries which by
their own choice are not contracting parties thereto.
4. Nationals of either Party admitted into the territories of the
other Party for limited purposes shall not enjoy rights to engage in
gainful occupations in contravention of limitations expressly imposed,
according to law, as a condition of their admittance.
5. Nothing in the present Treaty shall be deemed to grant or imply
any right to engage in political activities.
1. The term "national treatment" means treatment, accorded within
the territories of a Party upon terms no less favorable than the
treatment accorded therein, in like situations, to nationals, companies,
products, vessels or other objects, as the case may be, of such Party.
2. The term "most-favored-nation treatment" means treatment
accorded within the territories of a Party upon tenors no less favor-
able than the treatment accorded therein, in like situations, to na-
tionals, companies, products, vessels or other objects, as the case
may be, of any third country.
3. As used in the present Treaty, the term "companies" means
corporations, partnerships, companies and other associations, whether
or not with limited liability and whether or not for pecuniary profit.
Companies constituted under the applicable laws and regulations
within the territories of either Party shall be deemed companies
thereof and shall have their juridical status recognized within the
territories of the other Party.
4. National treatment accorded under the provisions of the present
Treaty to companies of Japan shall, in any State, Territory or posses-
sion of the United States of America, be, the treatment accorded
therein to companies created or organized in other States, Terri-
tories, and possessions of the United States of America.
The territories to which the present Treaty extends shall comprise
all areas of land and water under the sovereignty or authority of each
Party, other than the Panama Canal Zone and the Trust Territory of
the Pacific Islands, except to the extent that the President of the
United States of America shall by proclamation extend provisions of
the Treaty to such Trust Territory.
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16 TREATY WITH JAPAN AND PROTOCOL RELATING THERETO
1. Each Party shall accord sympathetic consideration to, and shall
afford adequate opportunity for consultation regarding, such represen-
tations as the other Party may make with respect to aizy matter
affecting the operation of the present Treaty.
2. Any dispute between the Parties as to the interpretation or
application of the present Treaty, not satisfactorily adjusted by diplo-
macy, shall be submitted to the International Court of Justice, unless
the Parties agree to settlement by some other pacific means.
1. The present Treaty shall be ratified, and the ratifications thereof
shall be exchanged at Washington as soon as possible.
2. The present Treaty shall enter into force one month after the
day of exchange of ratifications. It shall remain in force for ten years
and shall continue in force thereafter until terminated as provided
herein.
3. Either Party may, by giving one year's written notice to the
other Party, terminate the present Treaty at the end of the initial
ten-year period or at any time thereafter.
IN WITNESS WHEREOF the respective Plenipotentiaries have signed
the present Treaty and have affixed hereunto their seals.
DONE in duplicate, in the English and Japanese languages, both
equally authentic, at Tokyo, this second day of April, one thousand
nine hundred fifty three.
For the United States of America:
ROBERT MURPHY
For Japan:
KATSUO OKAZAKI
[SEAL] [SEAL]
PROTOCOL
At the time of signing the Treaty of Friendship, Commerce and
Navigation between the United States of America and Japan, the
undersigned Plenipotentiaries, duly authorized by their respective
Governments, have further agreed on the following provisions, which
shall be considered integral parts of the aforesaid Treaty:
1. The term "access to the courts of justice and to administrative
tribunals and agencies" as used in Article IV, paragraph 1, compre-
hends, among other things, legal aid and security for costs and
judgment.
2. The provisions of Article VI, paragraph 3, providing for the
payment of compensation shall extend to interests held directly or
indirectly by nationals and companies of either Party in property
which is taken within the territories of the other Party.
3. The term "public utility enterprises" as used in Article VII,
paragraph 2, is deemed to include enterprises engaged in furnishing
communications services, water supplies, transportation by bus,
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TREATY WITH JAPAN VTD PROTOCOL RELATING THERETO 17
truck or rail, or in manufacturing and distributing gas or electricity,
to the general public.
4. With reference to Article VII, paragraph 4, either Party may
require that rights to engage in mining shall be dependent on reci-
procity. Furthermore, Japan shall not be obliged by the terms of
that paragraph to accord to enterprises of nationals and companies
of the United States of the types mentioned, in the first sentence of
paragraph 2 of Article VII more 'favorable treatment than . that
accorded by the State or Territory of the United States of America
in which such national is domiciled, or pursuant to the laws of which
such company is organized, or in which, if such company is organized
under Federal law, such company has its principal office, to the enter-
prises of nationals and companies of Japan.
5. The provisions of Article VIII, paragraph 2, shall not extend
to the professions of notary public and port pilot.
6. Either Party may impose restrictions on. the introduction of
foreign capital as may be necessary to protect its monetary reserves
as provided in Article XII, paragraph 2.
7. With reference to Article XIV, paragraph 4, it is understood
that either Party, acting in accordance with its laws, may prohibit
the importation into its territory, or seize, or otherwise restrict or
regulate the sale of any goods with respect to which there has been
failure to comply with marking requirements established to assure
that the true geographic or commercial origin of such goods is cor-
rectly represented. Furthermore, each Party agrees to take appro-
priate steps to prevent misrepresentations, direct or indirect, that
goods produced or sold in or exported from its territory originate
within the territory of the other Party or any distinctive place within
such territory.
8. During periods of emergency resulting in reduced availabilities
of industrial raw materials and basic foodstuffs, the provisions of
Article XVI, paragraph 1, of the present Treaty shall not prevent
the application by either Party of needed controls over the internal
sale, distribution or use of imported articles of categories which may
be in short supply, other than or different from controls applied with
respect to like articles of national origin. If imposed, such controls
shall be applied by either Party in such a manner as to minimize
injury to the competitive position within its territories of the com-
merce of the other Party, and shall be continued no longer than
required by the supply situation..
9. Notwithstanding the national treatment' provisions of Article
XVI, paragraph 1, a Party may maintain screen quota regulations
that require the exhibition of cinematograph films of national origin
during a specified minimum portion of the screen time actually
utilized by exhibitors for the commercial exhibition of all films.
Screen quotas shall be computed on the basis of screen time per
theatre per year or the equivalent thereof, and shall be subject to
consultation.
10. It is understood that for the purposes of Article XVII, para-
graph 1, availability of means of payment is considered to be a
commercial consideration.
11. The provisions of Article XVII, paragraph 2 (b) and (c), and
of Article XIX, paragraph 4, shall not apply to postal services.
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12. The provisions of Article XXI, paragraph 2, shall apply in the
case of Puerto Rico regardless of any change that may take place in
its political status.
13. Article XXIII does not apply to territories under the authority
of either Party solely as a military base or by reason of temporary
military occupation, or to Nansei Shoto south of 29 degrees north
latitude (including the Ryukyu Islands and the Daito Islands), Nanpo
Shoto south of Sofu Gan (including the Bonin Islands, Rosario Island
and the Volcano Islands) and Parece Vela and Marcus Island, the
status of which is provided for in Article 3 of the Treaty of Peace with
Japan signed at San Francisco on September 8, 1951,
14. The most-favored-nation treatment provisions of the present
Treaty shall not apply with respect to those rights and privileges which
may, be accorded by Japan to: (a) persons who originated in the terri-
tories to which all right, title and claim were renounced by Japan in
accordance with Article 2 of the Treaty of Peace with Japan signed at
San Francisco on September 8, 1951; or (b) the native inhabitants and
vessels of, and trade with, the islands mentioned in Article 3 of the
said Treaty of Peace.
15. During a transitional period of three years from the date of the
coming into force of the present Treaty, Japan may continue to apply
existing restrictions on the purchase by aliens, with yen, of outstanding
shares in Japanese enterprises.
IN WITNESS WHEREOF the respective Plenipotentiaries have signed
this Protocol and have affixed hereunto their seals.
DONE in duplicate, in the Enlish and Japanese languages, both
equally authentic, at Tokyo, this' second day of April, one thousand
nine hundred fifty three.
For the United States of America:
ROBERT MURPHY
For Japan:
KATSUO OKAZAKI
[SEAL] [SEAL]
0
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