Tuesday, April 20, 2021
Article: The Transformation of Japanese Trust Law and Practice: Historical Contexts and Future Challenges
Masayuki Tamara recently published an article entitled, The Transformation of Japanese Trust Law and Practice: Historical Contexts and Future Challenges, Wills, Trusts, & Estates Law ejournal (2021). Provided below is the abstract to the Article.
Japan is one of the earliest civil law jurisdictions that introduced common law trust by statute. The Trust Act of 1922 was enacted as Japan’s first comprehensive trust legislation. Since then, trust has been used mostly for commercial purposes. Today, commercial trust is a zillion yen industry.
The new Trust Act, which was introduced in 2006 to replace the 1922 Act, reform was primarily motivated by the desire to increase flexibility of trust law to meet the needs of the increasingly complex commercial trust practices. Nevertheless, the 2006 Act contained several provisions that expressly authorize the use of trusts for succession planning. With the rapid aging of the Japanese society, the past decade has seen growing interests in what are commonly known as ‘family trusts,’ where the settlor looks to his family or friends to serve as trustee to manage his or family assets or oversee succession.
This paper will proceed as follows. Part I will provide historical overview of Japanese trust practices, and introduce some of the major commercial uses of trusts. Part II will discuss the recent rise of family trusts and some of the issues that they brought about. Against the historical background, Part III will attempt a doctrinal exposition of some of the major doctrine of trust law, with some speculation on what changes might be visible on the horizon. Part IV will look at some of the challenges that Japanese trust practice is facing in cross-border contexts.