EU Japan Business. Trade. Investment. M&A.

EU Japan business, trade, investment, mergers and acquisitions

EU Japan Business: trade negotiations

EU Japan Business: EU Japan trade negotiations were officially launched on 25 March 2013, and negotiations for a free trade agreement (FTA) and an economic partnership agreement (EPA) are in progress.
Background and current status is recorded here.

EU Japan cooperation agreements

The European Community – Japan Joint Declaration of 18 July 1991 (The Hague Joint Declaration) declared commonly held values and laid the foundation for many agreements structuring the cooperation between the European Community and Japan.
Today many agreements have been concluded, find a list and explanation of EU-Japan partnership and cooperation agreements here.

EU Japan summit meetings

Since the First EC-Japan Ministerial Meeting in 1984, and the 1st EC-Japan Summit on 18 July 1991 in The Hague, EU-Japan summit meetings take place regularly, find details here.

EU Japan M&A register

EU direct investments in Japan total approximately € 85 billion, while Japanese investments in Europe total about € 150 billion.

Register of M&A transactions between Europe and Japan:

EU-Japan trade in goods and services

Combined trade in goods and services between EU and Japan amounts to approximately EURO 80 billion each each direction, i.e. about EURO 160 billion in total, and is balanced.

EU Japan business and trade register:

Market entry to Japan

Several European companies have been established in Japan for 100 years or longer, but the total number and volume of European companies in Japan is still quite low, and there is a very substantial number of large and small European companies which are not yet engaged in Japan.

More on market entry to Japan…

Science, technology and innovation

In an annex to the 16th EU-Japan Summit in Berlin on 5 June 2007 the EU and Japan expressed intensions to cooperate further in science, technology and innovation, which led to the EU-Japan Science and Technology Cooperation Agreement of 13 November 2009.
More on EU Japan cooperation in science, technology and innovation…

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EU-Japan news

Irish wind energy €300m investment by Sojitz, Mitsubishi UFJ Lease & Finance and Kansai Electric Power Corporation

Japanese consortium of trading company Sojitz, Mitsubishi UFJ Lease & Finance and Kansai Electric invest in five Irish wind farms Irish wind energy €300m investment Irish wind energy investments were announced by trading company Sojitz, Mitsubishi UFJ Lease & Finance and Kansai Electric Power Corporation. Sojitz, Mitsubishi UFJ Lease & Finance and Kansai Electric Power …

Dentsu acquires Gleam Futures via Dentsu Aegis Network as a cultural bridge

Dentsu uses London based Dentsu Aegis Network as a cultural bridge to acquire representation of about 40 YouTube stars Dentsu acquires Gleam Futures: invests to acquire 90% ownership Dentsu acquires Gleam Futures, who “develop, monetize & protect” digital-first talent, ie mainly YouTube focused stars. Japanese companies have a dramatically different culture than Western, European or …

Roche acquires Chugai Pharmaceutical controlling stake, expanding in Japan, the world’s second largest pharmaceutical market

Japan’s pharmaceutical market is approx. US$ 80 billion – US$ 120 billion, approx. 10% of the global pharmaceutical market Roche acquires Chugai: Roche KK merges into Chugai in a carefully structured process, with Chugai the surviving company Roche acquires Chugai in a series of carefully crafted transactions, to expand in the world’s second largest pharmaceutical …

EU Japan investment and M&A

EU Japan investment (FDI), mergers and acquisitions (M&A)

The period of EU-Japan “trade friction” is long over, however European direct investments in Japanese companies is still at a fairly low level and stable, not growing. While the mutual EU-Japan investment partnership between Renault and Nissan is by all measures a huge success, there have been a number of very large and very visible failures of European investments in Japan, especially Vodafone-Japan, Cable & Wireless and several others. Future European investments in Japan have the advantage, that they can learn from both past success stories such as Renault/Nissan, but they can also learn from failures and strive to avoid to repeat the same mistakes.

M&A and direct investment (FDI) transactions:

Investment stock between EU and Japan

EU-Japan investment Foreign direct investment (FDI) stock between EU and Japan
Foreign direct investment (FDI) stock between EU and Japan

EU to Japan

Europe to Japan M&A, details of transactions

EU investments in Japan have been relatively constant around EURO 80 billion. There has been a marked reduction in EU investment in Japan in 2006 due to the withdrawal of Vodafone from Japan with the sale of Vodafone KK to Softbank for approx. EURO 12 billion (find details of the Vodafone-SoftBank M&A transaction here). This reduction of EU investment stock in Japan is clearly visible in the graphics below in 2006 and 2007.

Several major European direct investments in Japan failed, by far the largest failures were Vodafone-Japan and Daimler’s investment in Mitsubishi Motors. Had these two businesses been successful, the EU director investment stock in Japan would today be much higher as shown in the following figure, and as discussed in detail in our blog article “EU Management: what is the value of good management in Japan?”.

Had Vodafone Japan and Daimler's investment in Mitsubishi motors not failed, EU direct investment stock in Japan would be much higher today.
Had Vodafone Japan and Daimler’s investment in Mitsubishi motors not failed, EU direct investment stock in Japan would be much higher today.

Japan to EU

Japan to Europe M&A, details of transactions

Japanese investments in EU are steadily increasing, as Japanese companies are seeking to grow business outside Japan’s saturated market, and as Japanese companies acquire European companies for market access, technology and global business footprint. In 2012 the total investment stock of Japanese companies in the EU-27 has reached around EURO 150 billion.

Investment flow between EU and Japan

EU-Japan investment Foreign direct investment (FDI) flow between EU and Japan
Foreign direct investment (FDI) flow between EU and Japan

Investment flow between EU and Japan shows strong impact from the Lehmann shock economic downturn. Investment flow from EU to Japan remains at relatively low levels around EURO 1 billion annually, while investments by Japanese companies in the EU are on the order of EURO 10 billion per year currently.

Mergers and acquisitions in Japan need a carefully structured and systematic process

Thorough preparations and a carefully structured and systematic approach reduces risks and increases the chances of success:

  1. M&A process
  2. Understand the industry: research
  3. Find and approach partners
  4. Build cooperation
  5. Stakeholders
  6. Due diligence
  7. Finance
  8. Negotiate and close agreements
  9. Post merger

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EU Japan agreements, Free Trade Agreement (FTA) and Economic Partnership Agreement (EPA)

Japan-EU cooperation agreements and trade negotiations

EU Japan agreements and trade negotions

EU Japan agreements : EU-Japan trade negotiations were initiated at the 20th EU-Japan Summit on 28 May 2011, and EU Japan trade negotiations were officially launched on 25 March 2013 by EU President Jose Manuel Barroso, President Herman Van Rompuy and Japanese Prime Minister Shinzo Abe.

There are two parallel negotiations:

  • Free Trade Agreement (FTA)
  • Economic Partnership Agreement (EPA), a political framework agreement

Read a detailed documentation of EU-Japan trade negotiations and their progress here.

The 1991 Hague Joint Declaration and the 2001 Action Plan for EU-Japan Cooperation

Agreements

Europe Japan Science and Technology Agreement

EU-Japan Summit Meetings

EU-Japan Summit meetings started with the 1st EC-Japan Ministerial Meeting in 1984, the 22nd EU-Japan Summit Meeting was held in 2014.

List of EU Japan Summit meetings and EC-Japan Ministerial Meetings with links to documents.

Copyright (c) 2014-2017 Eurotechnology Japan KK All Rights Reserved

EU Japan: Technology, Science, Innovation

EU Japan innovation, science and technology

EU Japan Science and Technology Cooperation Agreement

  • Agreement between the European Community and the Government of Japan on Cooperation in Science and Technology (published in the Official Journal of the European Union), done at Brussels 13 November 2009 (download pdf-file)

EU Roadmap for International Science and Technology Cooperation

  • Report on the implementation of the strategy for international cooperation in research and innovation, 11 September, 2014, (download pdf-file),
    accompanying documents:

    • EU Roadmaps for International Science and Technology Cooperation, 11 September 2014 (download pdf-file)