Pro-Innovation AI Governance Framework

Japan enacted the Act on Promotion of Research and Development, and Utilization of AI-related Technology (AI Promotion Act) in May 2025, coming into full effect in September 2025. This legislation codifies Japan's pro-innovation approach to AI governance — notably different from the EU's risk-based AI Act. Japan's framework emphasizes promotion over restriction, and its copyright law (Article 30-4) already permits use of copyrighted works for AI training without rights-holder consent, a position no other major economy has adopted.

The AI Promotion Act establishes a government framework for fostering AI development while addressing safety through voluntary guidelines rather than prescriptive regulation. Japan's ¥135 billion investment in AI infrastructure (announced in 2025) includes computing resources, training data initiatives, and human capital development. The combination of permissive regulation and public investment is designed to attract AI companies and talent to Japan.

The governance approach is a calculated strategic bet. Japan concluded that restrictive AI regulation would disadvantage its companies against US and Chinese competitors who face different regulatory environments. By making Japan maximally attractive for AI development — through copyright flexibility, investment incentives, and light-touch regulation — the government aims to establish Japan as Asia's AI hub. This is working: Sakana AI's Tokyo HQ, NVIDIA's Japanese partnerships, and Microsoft's data center investments all cite the regulatory environment as a factor.