• 11 AUSTRALIA: Perth Shines • 12 HONG KONG: Aggressive Hiring
• 12 SINGAPORE: Taking On Asia • 13 THE CHURN
JAPAN
The Meltdown This Time
The Fukushima Daiichi nuclear plant suffered a series of melt- downs after an earthquake and
tsunami struck Japan’s east coast in
March. Had the plant been in America,
its operators would be bracing themselves for a second tidal wave: litigation.
But things should work out rather differently in Japan.
The plant’s owner and operator, Tokyo
Electric Power Co. (Tepco), may have to
pay compensation of up to
$143 billion, according to an
estimate by Bank of America
Merrill Lynch. The Japanese
government has set up a fund
to pay damages on the company’s behalf, and has contributed an initial $26 billion
to it, with more capital injections to come. For its part,
Tepco will make annual contributions to the fund along
with Japan’s other nuclear
operators. The plan is to ensure that victims get a swift
payout while keeping Tepco
on life support and generating power for a country that
had to ration electricity usage for six months after the
disaster.
The government’s choice
to bail out Tepco rather than
let it implode was perhaps
inevitable. Past industrial
accidents in Japan have
shown that it is the desire
to restore order, and not the
battle for compensation, that prevails.
AFP PHOTO/NEWSCOM
Tepco had hoped for a partial reprieve
from having to pay compensation under
Japanese law, which caps nuclear plant
operators’ liability in the case of “a grave
natural disaster of an exceptional charac-
ter.” But the government scuppered that
hope in May, when it announced that the
quake, while big, could not be considered
exceptional. One opposition politician
compared Tepco’s future to the “zom-
bie” banks of the early 1990s, hobbled by
their debt to the state and other lenders.
The accident at the Fukushima Daiichi plant
is unlikely to lead to much litigation—in
Japan, the desire for order usually prevails
over the desire for compensation.
provision of the 1961 Act on Compensa-
tion for Nuclear Damage. The center has
branches in Tokyo and Fukushima, and
is staffed with dozens of lawyers.
Most disputes will come from individ-
ual residents arguing that their payment
from the compensation fund doesn’t
meet their individual circumstances, says
Yoshimasa Furuta. A partner at Anderson
Mori & Tomotsune, he is a special mem-
ber of the Dispute Reconciliation Com-
| Winter 2012 | 7
