This chapter first examines the current patterns of Japanese-and US-owned economic activity in West European manufacturing industry. It goes on to suggest some hypotheses for the similarities and differences in these patterns, within the framework of one of the most generally accepted paradigms and some of the best-known theories of foreign direct investment (FDI) and the activities of multinational enterprises (MNEs). It then offers some exploratory evidence on the significance of the variables identified in the earlier sections. The chapter concludes by considering whether or not the distinctive structure of Japanese MNE activity in Europe is likely to continue in the later 1990s.