The first step will be to colour match the two sources, there are many ways to do this, but I would use Nuke and work it via a script to get the sources as close as possible.

Once you have them colour matched, then you need to align them, you could use Elastix if you want it exact, or could use the warper in After Effects or similar to get it close.

Then it is a matter of blending the footage using some soft masks, you should be able to extract a mask for the subtitles as they will be a particular 'colour', and then create a soft blend of the PAL material into the Japanese footage.