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ฉบับพิเศษ ประจำ�ปี 2564

any foreign law for a car once arrived and thereafter remaining in Japan, and before

being registered there. Whatever the Supreme Court considered as the “stability of trade”
in terms of choice-of-law, any foreign law, which at first acknowledged the ownership

to a person, cannot always work for the stability of ownership of the same movable,
once arrived in Japan. Instead, on the basis of the principle of lex loci rei sitae, a certain
kind of “secure and stable transaction” protected by Japanese Law is given priority over

other stability or concerns shown by foreign laws.

Once registered in Japan, the reasoning of the Supreme Court seems also to lead
to the possibility that the law of Japan, as the place of primary use, should apply,
even though the car is stolen, exported and possessed abroad. This means an extension

or extraterritorial application of Japanese property law on a car located abroad.
This last point still depends on how to identify the place of primary use. It also relates
to another side of the issue, in which case a foreign law is chosen as applicable.

According to the Supreme Court’s judgment, it would be possible to claim that
the law of the place of physical existence is chosen as applicable for a car which is

physically located in a foreign country without any registration which would allow it
to be put in the state ‘ready for use’ there. However, in other situations, the same

formulation might lead to the choice and application of Japanese laws in a case in which
a car was registered in Japan and moved thereafter to another country, as the place of
primary use might still be regarded to be in Japan, and a car might be regarded to be

still in the state ‘ready for use’ there. The verification of this point was left uncertain in
the judgment due to the general formulation composed of very ambiguous concepts.

It also means that it is not sufficiently clear in which case a foreign law can be chosen
as the applicable law.

There still remains the possibility that the formulation would work unilaterally
and parochially, leading to the extraterritorial application of Japanese Law, although
it appears to be a bilateral and neutral rule for international commerce.

2. Parochial reaction from Japanese scholars

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