The Law Council has warned the risk would contravene Australia's staunch objection to capital punishment.
The "reciprocal access agreement" helps the two militaries work together and with other allies including the United States.
It also sets out a legal framework for troop activities in each country.
The Law Council has told a parliamentary committee the treaty contains no provisions to stop Australian defence personnel being sentenced to death in Japan.
"They are very easy words to insert," Law Council director Tass Liveris said on Wednesday.
"It's as simple as a statement that says: 'A sentence of death will not be carried out by either party'."
Japan last hanged a convicted murderer in July.
"The Law Council opposes the imposition of the death penalty in all circumstances for all people," Mr Liveris said.
A previous hearing was told the chances of an Australian facing the death penalty were "vanishingly small" but Mr Liveris said that wasn't the point.
"If Australia is serious about its policy (against the death penalty), then it needs to ensure it doesn't enter into agreements that have any risk at all," he said.
The committee also heard it was possible for Australian personnel to be wrongly accused or involved in something like a car crash in Japan, where there were different interpretations about intent.
"I don't think it's correct to say there is a vanishingly small risk here," Mr Liveris said.
"It may be that it is not an enormous risk. But there should be no question here."
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