Restrictive Trade Practices and the Extraterritorial Application of U.S. Antitrust and Trade Legislation

The Japan-U.S. economic relationship has been marked by tremendous friction and misunderstanding. These tensions have given rise in the past to the extraterritorial application of U.S. trade and antitrust laws to perceived public and private restrictive trade practices. In this paper, I will review the U.S. approach to the extraterritorial application of trade and antitrust laws, particularly as they apply to Japan. I will conclude that although formal coercion has given way to more bilateral negotiations, demands will grow for a return to the more aggressive U.S. posture of the past unless meaningful and effective market access is achieved.

I will conclude with some observations that both sides might consider a mutually beneficial multilateral alternative as a possible step towards finding a more stable equilibrium in settling their ongoing competition policy-related disputes.