Reasons for Complaint
In March 2001, the Kagawa Prefecture port and harbor manager denied the right of innocent passage (as provided in Article 17 of the United Nations Convention on the Law of the Sea) at Takamatsu Port (Kagawa Prefecture), an open port under the Tariff Act, for a foreign ship chartered by an export-import company and its associated company (Hong Kong) to import river sand from China's Fujiang Province to Japan. Therefore, these companies suffered the interruption of the ship's passage, entry into a port and mooring alongside a pier by a coastal country. The Kagawa Prefecture port and harbor manager told the complainant that the manager could interrupt the relevant foreign ship's mooring alongside a pier for the reason that dispersion of sand and the like might have unfavorable impacts on the vicinity of the port and interrupt cargo handling for other ships.
In response, the export-import company filed in June 2001 an application with the said port and harbor manager for a permit to use an open-air yard in order to import bagged river sand without the possibility of dispersion of sand. But the application was disapproved. The complainant then filed a protest with the Kagawa Prefecture Governor against the action but only received a written explanation saying that sand would likely be dispersed.
According to a survey by the complainant, a research group of Tsukuba University's graduate school said, at the 56th annual academic presentation meeting of the Japan Society of Civil Engineers in October 2001, that the wind friction velocity at which sand begins to disperse is 0.22-0.25m/s (a wind velocity of 4.0-4.5m/s). According to observation by the Takamatsu local meteorological observatory, the average wind velocity in Takamatsu City is 2.5m/s. Therefore, it is unthinkable that accumulated sand disperses to the extent of having unfavorable impacts on the vicinity of Takamatsu Port or interrupting other firms' cargo handling. There is an open-air yard at the port, and bulk cargo handling and open freighting is common. But any public hazard through sand dispersion has never been identified.
Furthermore, bagged sand is clearly not likely to disperse during cargo handling. The discretion of the coastal country's port and harbor manager must not deny international law including the United Nations Convention on the Law of the Sea (Article 21 of the convention) and local governments in Japan are banned from setting up any ordinance, etc. running counter to domestic law (Article 14 of the Local Autonomy Law). Therefore, the disapproval of the applications for permits to use the port and harbor facilities in question is highly likely to be unequal treatment against river sand from China's Fujiang Province, the export-import company in question and its associated company (Hong Kong). The complainant thus asks the Ministry of Land, Infrastructure and Transport to look into the case and confirm a violation of Article 13(2) of the Port and Harbor Law. The complainant also asks the ministry to promptly suspend the unequal treatment by the Kagawa Prefecture port and harbor manager (Article 47 of the Port and Harbor Law) if the violation is confirmed.
In the F Area of Takamatsu Port in March 2001, the Kagawa Prefecture's Civil Engineering Department and the officials of the Port and Harbor Division of the said department blocked a foreign ship chartered by the export-import company in question and its associated company (Hong Kong) from mooring alongside a pier. The Port and Harbor Division of the Kagawa Prefecture's Civil Engineering Department then cited the department director's notice No. 364 dated March 29, 1993, as a reason to interrupt the innocent passage of a foreign ship. But the complainant's survey revealed that Sanbonmatsu Port managed by Kagawa Prefecture is a "non-open port" under the Customs Law of Japan and is a facility that has a different nature as public facility from Takamatsu Port which is an "open port."
At "open ports" that are designated by Cabinet ordinances with considerations given to cargo exports and imports, foreign trade ships' entries and departures, and other matters, coastal countries are not allowed to deny entry into port and harbor facilities by foreign ships that have the right of innocent passage guaranteed under Article 17 of the United Nations Convention on the Law of the Sea (Article 24 of the United Nations Convention on the Law of the Sea). Therefore, the director's notice in question is not applicable to "open ports" under the Customs Law of Japan and is considered to be a regulation for local ports and harbors. The complainant thus asks the Ministry of Land, Infrastructure and Transport to look into this matter as well.

(Second Opinion, February 19, 2003)
1. At Takamatsu Port, sea sand collectors and sellers of broken mountain stones unload such products every day. The vicinity of the port is in an industrial zone with restaurants and offices. There are some sand firms in the area. Kagawa Prefecture has disapproved applications for permits to use port and harbor facilities filed only by the export-import company in question, which is a cross-border firm operating in Hong Kong and Japan, for the reason of sand dispersion. This is an irrational discrimination and has a large problem in terms of the Port and Harbor Law.
2. Interruption of the right of innocent passage
(1) The right of innocent passage is interrupted in waters (territorial sea) off Kochi. (2) The Seto Inland Sea is not internal waters, but Japan treats the sea as internal waters. Any inland sea with a mouth width of 24 miles or more does not fall within the definition of internal waters.
Based on the above, the complainant raises an objection to the ministry's views.

(Third Opinion, February 19, 2003)
The complainant wants the Ministry of Land, Infrastructure and Transport to answer the following questions:
1. (While the complainant submitting a list of sand collectors and sellers in Takamatsu Port) All in the list unload sand at Takamatsu Port. Why has the unloading of Chinese river sand by the export-import company in question been disapproved for the reason of dust?
2. The complainant understands that regulations on other sand firms are limited to requiring (1) water spray and (2) the installation of concrete walls, which are Takamatsu City's general dust regulations. Why does Kagawa Prefecture impose more regulations only on the export-import company in question in addition to the two regulations on other sand firms? Is it not required to give equal treatment to the company in question and other sand firms?

(Fourth Opinion, March 31, 2003)
The export-import company in question always meets Kagawa Prefecture's screening standards for the use of port and harbor facilities. According to a survey by the secretary-general of a citizen's organization, Kagawa Prefecture's Civil Engineering Department director at the time abruptly discriminated against the export-import company in question on July 3, 2001, and suddenly inserted new screening standards in order to arbitrarily block the export-import company in question from lending port and harbor facilities. The screening standards that then Civil Engineering Department director suddenly created and inserted are contradictory to the purpose of the Kagawa Prefecture Port and Harbor Management Ordinance, and also violate the ordinance.

(Fifth Opinion, April 18, 2003)
On April 8, 2003, the associated company of the export-import company in question (Hong Kong) filed an application with Kagawa Prefecture for a permit to moor at a pier and to use another port and harbor facility (open-air yard) in the F Area of Takamatsu Port for importing granite for construction into Japan. The application was received by Kagawa Prefecture on April 16, 2003. In response to the application, the Kagawa Prefecture port and harbor manager sent a fax titled "Request for additional documents to the application for a permit to use port and harbor facilities" to the office of the associated company on April 17, 2003. The request called for as many as 10 documents including Japanese translation of a charter agreement and other complex documents. The deadline for the submission of the additional documents was very immediate at 3 p.m. on the same day (Japanese time).
At 6:15 p.m. (Japanese time) on the same day, Kagawa Prefecture faxed the Takamatsu Port Notice 15-K15 to the associated company of the export-import company in question. The notice stated as reasons for disapproval that "The application and related documents failed to concretely and clearly specify cargo-handling methods, schedules, sizes and shapes of granite, and destinations of cargoes and thus, Kagawa Prefecture cannot determine that the use of the port and harbor facilities by the associated company would not seriously affect the use and maintenance of ports and harbors by others or traffic in the vicinity."
Kagawa Prefecture intentionally imposed the imminent deadline for the submission of additional documents and again disapproved the application of the export-import company in question.

(A reply on February 7, 2003)
(1) Article 13(2) of the Port and Harbor Law
Kagawa Prefecture has an ordinance requiring that anyone who is going to use port and harbor facilities obtain a permit from the governor. The Port and Harbor Law allows port or harbor managers to impose necessary regulations on ships using mooring facilities. There is nothing wrong with establishing internal rules for enforcing such regulations in terms of the Port and Harbor Law, unless these rules result in unreasonable discrimination.

The disapproval of applications by the export-import company subject to the complaint in question has been made for the reason of dust. This reason reflects considerations given to the possible impact on the vicinity of the port and is deemed to be rational.
Regulations on individual piers are to be determined by port and harbor managers in autonomous work, in accordance with respective conditions within the reasonable scope. It is thus possible that the unloading of natural sand is allowed at other ports.
As explained above, the Ministry of Land, Infrastructure and Transport cannot identify any problem in terms of the Port and Harbor Law in respect to Kagawa Prefecture's action based on the complaint, and thus cannot respond to the complaint.

(2) United Nations Convention on the Law of the Sea
The complaint of the export-import company in question alleges that the Kagawa Prefecture port and harbor manager violated Article 24 of the United Nations Convention on the Law of the Sea and interrupted a foreign ship's innocent passage. However, the "innocent passage" as defined in Article 17 of the United Nations Convention on the Law of the Sea refers to the passage through the territorial sea (Article 18). Takamatsu Port is located in internal waters, and therefore, the port and harbor manager's action does not deny a foreign ship's right of innocent passage.

(A reply on March 19, 2003)
(1) Article 13-2 of the Port and Harbor Law
Although the complainant claims that Kagawa Prefecture's action amounts to a trade barrier, what the Ministry of Land, Infrastructure and Transport can do is to make judgment from the viewpoint of whether Kagawa Prefecture's action presents any problems in terms of the Port and Harbor Law. Since the action is considered to present no problems in terms of the Port and Harbor Law, the ministry cannot respond to the complaint.
When the ministry made an inquiry on the matter to Kagawa Prefecture, the prefecture answered that it could give a permit to use some port and harbor facilities if an application filed meets standards for permission to use port and harbor facilities and the like as set by Kagawa Prefecture.

(2) Treatment of the Seto Inland Sea under the United Nations Convention on the Law of the Sea
In June 1977, Japan specified the Seto Inland Sea as internal waters and sent a notice to this effect to foreign countries through foreign embassies in Tokyo and the United Nations.

(3) Japan's Territorial Sea Limit off Kochi
As shown in the material (from the Japan Coast Guard), the straight baseline as provided in Article 7 of the United Nations Convention on the Law of the Sea is established in waters off Kochi Prefecture. According to Article 8 of the convention, waters on the landward side of the baseline are internal waters. Therefore, Japan's territorial sea is up to 12 miles away from the straight baseline.

(A reply on April 17, 2003)
The Ministry of Land, Infrastructure and Transport makes judgment from the viewpoint of whether Kagawa Prefecture's action presents any problems in terms of the Port and Harbor Law. The regulations imposed by the Kagawa Prefecture cannot be considered to amount to the unequal treatment as provided in Article 13(2) of the Port and Harbor Law as far as they are applied equally to all applicants rather than only to a particular applicant.

(A reply on May 9, 2003)
The same as the reply on April 17, 2003.

2. At the 22nd meeting of the OTO Grievance Resolution Committee on June 21, 2004, the Chairman summed up the response to the complaint in question in addition to OTO No. 658 that is based on the same complaint as follows.

(1) The complaint in question is that disapproval by Kagawa Prefecture (the port and harbor manager for F Area of Takamatsu Port) of all applications for permits to use port and harbor facilities for importing river sand for the reason of dust, etc. forms an import barrier.
(2) The complainant asserts that there is no threat of dust, etc. and that the disapproval in question violates the Port and Harbor Law and the United Nations Convention on the Law of the Sea. However, the Ministry of Land, Infrastructure and Transport states that the disapproval is based on a rational reason and it has no problem in terms of the Port and Harbor Law, and that in relation to the United Nations Convention on the Law of the Sea, the disapproval does not conflict with the convention in light of interpretation by the Ministry of Foreign Affairs.
(3) On the other hand, the importer that filed applications for permits to use with Kagawa Prefecture also filed a lawsuit claiming that disapproval by Kagawa Prefecture is illegal based on almost the same claim in parallel with filing the complaint in question. However, the Takamatsu District Court and High Court have already rendered a judgment that the disapproval in question is not illegal in light of the purpose of the Port and Harbor Law and that it also does not run counter to the United Nations Convention on the Law of the Sea.
(4) Since, as mentioned above, the court has already legitimated disapproval by Kagawa Prefecture from the viewpoint of public interest, deliberation on the complaint in question that claims the disapproval forms an import barrier leads to discussing legal interpretation made by the court. Therefore, it is not appropriate to deliberate the complaint in question at this committee.
(5) In addition, the complainant asserts that disapproval by Kagawa Prefecture should be eliminated as an import barrier before questioning its illegality. However, disapproval of unloading in F Area of Takamatsu Port cannot be immediately considered to form an import barrier, taking into consideration the fact that the Japanese government does not restrict the import of sand and that the unloading of sand is allowed in other areas of Takamatsu Port.
(6) The OTO has so far met requests from the complainant in terms of provision of information, etc., but in light of the above-mentioned court judgment, the complaint in question is considered to have lost its basis of argument. Regarding the complaint in question, although explanation by the administrative authorities seems to have been insufficient in some points in the process, the processing of the complaint cannot be proceeded since the complainant has not clearly shown a basis of argument for claiming that disapproval by Kagawa Prefecture forms an import barrier. Since there are only two kinds of status of processing of individual complaints, i.e. "processing" and "processed," it is appropriate to consider this case to be "processed."