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Ratification of Australia-Japan Basic Treaty



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No. Date THE HON. ANDREW PEACOCK M.P, _

Embargoed until 5 argoec 21 July 1977

p.m.

M44 21 July 1977

RATIFICATION OF AUSTRALIA-JAPAN BASIC TREATY

The Minister for Foreign Affairs, Mr Andrew Peacock, and the Ambassador of Ja p a n , Mr Yoshio jQkawara, today exchanged the instruments of ratification of the' Basic Treaty of Friendship and Co-operation between Australia and Japan,

The Treaty was signed in Tokyo on 16 June 1976

by the Prime Minister, Mr F raser, and the then Japanese Prime Minister, Mr Miki.

Today's exchange of instruments, in a ceremony in Parliament H o u s e , is the final formality required by the Treaty, which will now enter into force on 20 August - the 30th day after the exchange,

Mr Peacock said that the Basic Treaty of Friendship and Co-operation was the first of its kind Australia had concluded with any country. It marked the deepening relation­ ship between Australia and Japan and provided a sound basis for its future development.

The Treaty acknowledges formally the friendship, community of interests and interdependence that exist between Australia and Japan and establishes a broad framework of co-operation, including new agreements where necessary, in

specific areas. · .

It also recognises the mutual interest of both countries in each being a stable and reliable supplier to and market for the~othef... . /Importantly,, it-prescribes, ..ohua^mutual basis, specific standards of treatment to be accorded to

nationals and companies as regards their entry and stay and business and professional activities, including· investment.

J

21 July 1977

BASIC TREATY OF FRIENDSHIP AND CO-OPERATION BETWEEN

AUSTRALIA AND JAPAN

The object of this paper is to provide general notes

on the purpose and contents of the Basic Treaty of Friendship and

Co-operation between Australia and Japan, which will be ratified

with the exchange of the instruments of ratification between

the Australian Minister for Foreign Affairs, Mr Andrew Peacock,

and His Excellency the Ambassador of J a p a n , Mr Yoshio Gkawara,

on 21 July 1977.

„ Explanation of Negotiations

The first Australian draft of the present Treaty was

given to Japan in December 1973 = A Japanese draft was presented

in May 1974. During subsequent negotiations in the last quarter

of 1974 and the first quarter of 1975, progress was achieved in

reaching agreement on large parts of the text, but difficulties

were encountered in deciding on appropriate wording to prescribe

the specific standard of treatment that would be accorded to

nationals and companies of each side under Articles VIII and IX.

Proposals to achieve satisfactory wording were under consideration

for the res-t of the year. ' .

In December 1975, following the election of the present

Australian Government, the Japanese Prime Minister, Mr M i k i , .

indicated in a message to the Australian Prime Minister, Mr Fraser,

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the Japanese Government's desire to conclude the proposed Basic

Treaty as soon as possible. After conducting an urgent,

comprehensive review of the course of negotiations, the Australian

Government advised the Japanese Government of its willingness to

conclude the Treaty at an early date provided agreement could

be reached on a satisfactory text. Progress was achieved through

diplomatic exchanges in March and April 1976 and all outstanding

issues of substance were settled during formal negotiations

at Canberra from 3 to 6 May 1976„ The Treaty w a s 'then .signed by

the Australian Prime Minister, Mr Malcolm Fraser, and the then

Japanese Prime Minister, Mr Takeo M i k i , in Tokyo on 16 June 1976,

‘ , Purpose and Significance of the Treaty

. . The Treaty enshrines in formal and symbolic terms the

friendship, community of interests and interdependence that exists

between Australia and Japan and establishes a broad framework for

further co-operation, including new agreements, in specific areas.

It also recognises the two countries1 mutual interest in each

being a stable and reliable supplier to and market for the other \

and p r escribes, on a mutual b a s i s , specific standards of treatment

to be accorded to nationals and companies as regards their entry

and stay-and business and professional, activities, -

1 The Treaty is significant in that it is the first of its

kind that Australia has concluded with any country. None of

Australia's other treaty commitments, including the ANZUS Treaty

with the United States and New Zealand, the Commerce Agreement

with Japan and the Trade Agreement with New Zealand, is as

comprehensive. For Japan also the Basic Treaty has unique aspects

in that its scope and purpose are broader than those of Japan's

treaties of commerce and navigation with a dozen or so other

countries, including the United States and Britain,

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Contents of the Treaty

(a) The Preamble and Articles, I, II, III and IV describe

the basic principles underlying the Australia:/Japan

relationship and express the spirit in which the Treaty

was concluded;

(b) Article I foreshadows the possibility of Australia and

Japan concluding new agreements to govern their

relations in specific fields;

(c) Article II describes the general principles for Australia/

Japan co-operation in the international political arena

and expressly confirms the two countries' acceptance of

the Principles of the Charter of the United Nations;

(d) Article III lists various areas in the bilateral

relationship in which the two Governments undertake to

encourage co-operation and understanding by promoting

consultations and appropriate exchanges;

(e ) Article IV lays down the general principles for Australia/

Japan co-operation in the general area of international

economic relations; .

(f ) Article V contains important statements related to

Australia/Japan economic relations, including an under­

taking that those relations will be developed, on 'the basis

of mutual benefit and trust. This Article also recognises

the two countries 1 mutual interest in each being a stable

and reliable supplier to and market for the other in

respect of their bilateral trade. It should be noted ..that

the Basic Treaty does not provide for specific treatment

with regard to Australia/Japan bilateral trade, as this is

set out in detailed terms in the Australia/Japan Commerce

Agreement of 1957, as amended in 1963, and in the General

Agreement on Tariffs and Trade, to which both countries

are parties; .

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(g) Articles VI and VII cover respectively co-operation in

the trade and development of mineral resources and

co-operation in the exchange of capital and technology.

In each c a s e , it is provided that such co-operation shall

be in accordance-with the provisions of Article V;

(h) Atticles VIII and IX incorporate significant under­

takings for each side to provide specific treatment to

the nationals of the other as regards entry and stay and

to the nationals and companies of the other as regards

business and professional activities, including investment

activities. In particular, paragraph 1 of Article VIII .

and paragraph 3 of Article IX provide in this regard for

"fair and equitable treatment.....provided that in no case

shall such treatment be discriminatory between

nationals of the other Contracting Party and nationals

of any third country". It should be noted that paragraph

1 of the Agreed Minutes confirms that this standard of

treatment will in effect be most-favoured-nation treatment,

where it is understood that there is no requirement to

. apply retroactively policies that have already become

inoperative. It should also be noted that this standard

of treatment is entirely consistent with Australia's

existing policies and practice:

(i) . Article X contains general commitments for shipping between

the two countries to be developed on a fair and mutually

advantageous b a s i s ;

(j) Articles XI, X I I , XIII and XIV are general machinery

provisions allowing for representations and consultations

on the implementation of the Treaty and describing the

details of the Treaty's ratification and entry into force;

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(k) The various related instruments attached to the Treaty

all have the same legal effect, but differ in presentational

status in accordance with their contents and purpose;

(l) The Protocol is considered as an integral part of the.

Treaty and contains various qualifications to the '

commitments made in the Treaty proper. For example,

paragraph 1 of the Protocol excludes from the scope of

the Treaty commitments special privileges such as those

granted by either country to developing countries, those

granted under taxation agreements, those granted by Australia

to third countries by virtue of their membership of the

Commonwealth of Nations, and those granted by Japan to

persons who originated in its former colonies;

(m) The Exchange of Notes relating to the Non-Metropolitan

Areas of Australia confirms that the undertakings given

by Australia shall not apply within Australia's non­

metropolitan areas such as Cocos Islands, Christmas

Island and Norfolk Island;

(n) The Exchange of Notes Relating to Article VIII contains

supplementary provisions relating specifically to the:

treatment of businessmen temporarily resident in the

territory of the other country;

(o) The Agreed Minutes lists various understandings and

interpretations concerning the provisions of the Treaty

and the related instruments mentioned so far. It should

be noted that paragraph 3 of the Agreed Minutes confirms

that investment activities fall within the scope of

paragraph 3 of Article IX;

(p) The Record of Discussion records Japan's acknowledgement

of Australia's position as regards its aspirations .

towards ownership and control of its resources and

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industries» Japan has noted Australia's position rather

than subscribe to it, because existing Japanese legislation

inhibits direct government intervention in the ownership

and control of Japan's resources and industries»