U.S.-Japan Digital Trade Agreement and U.S.-Japan Trade Agreement Finalized

On October 7, USTR Robert Lighthizer and Ambassador Shinsuke Sugiyama signed both the U.S.-Japan Digital Trade Agreement and the U.S.-Japan Trade Agreement. President Trump praised the agreements, stating “[t]hese two deals represent a tremendous victory for both of our nations. They will create countless jobs, expand investment and commerce, reduce our trade deficit very substantially, promote fairness and reciprocity, and unlock the vast opportunities for growth.”

The two agreements signed Monday formalized earlier agreements between President Trump and Japanese Prime Minster Abe, which were reached a few weeks ago. Initialdetails of the agreements were covered in an earlier post on this blog in late September. The text of the agreements, as well as side letters on interactive computer services, alcoholic beverages, beef, rice, safeguards, skimmed milk powder, and whey, were also released Monday.

The Digital Trade Agreement includes many provisions similar to those included in the USMCA Digital Trade Chapter. Provisions eliminating discriminatory treatment of digital products, preventing future customs duties on electronic transmissions, validating the use of electronic signatures, and providing protections to online consumers and personal information appear in both the Digital Trade Agreement and the USMCA.

For information and communication technology (ICT) goods that use cryptography, neither party shall require a manufactureror supplier of a good, as a condition for sale, distribution, import, or use of an ICT good, to ​“transfer or provide access to any proprietary information relating to cryptography, including by disclosing a particular technology or production process.” This language is also found in Annex 12-C of the USMCA.

The agreements signal a growing economic partnership between the United States and Japan, and the two countries have committed to continue negotiating in the coming months with the hopes of concluding a comprehensive agreement.