Tokyo: The seventh Japan-EU financial regulatory forum met in Tokyo on 4 and 5 November, bringing supervisors from Japan’s Financial Services Agency and the European Commission to the same table. The two authorities co-hosted the session and published a joint statement on 6 November.

The agenda reflected how quickly financial risk is changing. Officials reviewed market developments and threats to financial stability. They then exchanged views on sustainable finance, digital finance, artificial intelligence, cybersecurity, banking, insurance and capital markets.

The Japan-EU financial regulatory forum matters because the two economies regulate some of the world’s largest banks, insurers and asset managers. Japan’s megabanks operate across European markets, while European lenders and fund houses hold significant positions in Tokyo. Divergent rules raise costs for both sides and create gaps that risk can slip through.

At the Japan-EU financial regulatory forum, both delegations stressed their commitment to internationally agreed standards and to multilateral cooperation. That message carries weight in 2026. Several jurisdictions have delayed or diluted parts of the final Basel III package, and the EU itself postponed elements of its market risk framework. Tokyo and Brussels used the meeting to signal that they still see global standards as the anchor for prudential policy.

Artificial intelligence was a central theme. The EU AI Act classifies certain credit scoring and insurance pricing systems as high risk, while Japan has preferred a lighter, principles-based approach. Supervisors in both jurisdictions want to understand how banks deploy AI models, how they test them and who carries responsibility when they fail.

Cybersecurity formed the second pillar of the discussion. The EU’s Digital Operational Resilience Act now requires banks, insurers and investment firms to manage information and communication technology risk and to oversee critical third-party providers such as cloud companies. Japan’s FSA runs its own cyber guidelines and sector-wide exercises. Sharing lessons on incident reporting and cloud concentration helps both supervisors prepare for cross-border shocks.

Sustainable finance remains a harder area for convergence. The EU has built a detailed taxonomy and disclosure regime, which it is now simplifying. Japan favours transition finance that supports gradual decarbonisation in heavy industry. The Japan-EU financial regulatory forum gives the two sides a regular channel to compare these approaches and to limit fragmentation for global investors.

Capital markets also featured on the Japan-EU financial regulatory forum agenda. The EU is pursuing its savings and investments union, while Japan continues reforms to channel household savings into equities. Both authorities share an interest in deeper, more liquid markets that can fund innovation and the energy transition.

The forum is part of a wider economic partnership. The EU-Japan Economic Partnership Agreement already covers financial services, and the two sides signed a Strategic Partnership Agreement alongside it. Regulatory dialogue turns those frameworks into practical cooperation between supervisors who must respond to the same global risks.

The next Japan-EU financial regulatory forum will take place in Brussels in 2027, keeping the annual rotation between the two capitals. Between meetings, technical staff will continue working on AI oversight, operational resilience and sustainable finance, where early alignment can prevent costly divergence later.