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Factors to be considered in the examination process

Japanese

August 2, 2017

 

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Press Release


Press release of factors that the Ministry of Finance and the competent ministries for the business consider when examining a prior notification in relation to inward Direct Investment, etc. and the Specified Acquisitions in accordance with the Foreign Exchange and Foreign Trade Act

 The Foreign Exchange and Foreign Trade Act (Act) stipulates that a prior notification on inward Direct Investment, etc., is to be examined where the investment, etc. is likely to; (a) impair national security, disturb the maintenance of public order, or hinder the protection of public safety: or, (b) have significantly adverse effect on the smooth management of the Japanese economy.
 The Act also stipulates that the "Specified Acquisition" (a transfer of shares issued by non-listed companies between foreign investors) is to be examined where the investment is highly likely to impair national security. In an effort to promote transparency of the examination process, the Ministry of Finance and the competent ministry for the business provide the following factors to be considered in the examination process.
 With a recognition that foreign direct investment contribute to the growth of the Japanese economy, the Ministry of Finance and the competent ministry for the business continue effort to promote foreign direct investment into Japan, which is a part of the government's fundamental policies.


(1) Inward Direct Investments, etc.
  1.  Maintenance of defense production and technological bases related to industries concerning national security (i.e. weapons, aircrafts, space and nuclear related industries, etc.)
  2.  Prevention of outflow of critical technologies to the national security.
  3.  Preservation of public services in an emergency and peacetime situations.
  4.  Protection of public safety.
  5.  Maintenance of stable supply of food or energy etc., sound stockpiling policy, preservation of national land, and productivity and continuity of specific domestic businesses, with respect to business types of which Japan has lodged a reservation pursuant to the provisions of Article 2-b of the Code of Liberalization of Capital Movements of the Organization for Economic Cooperation and Development , from the viewpoint of smooth management of the Japanese economy.
  6.  Characteristics of the investor and its affiliate party(ies),such as, their nature, financing plan and record of performance of their investment, etc.
  7.  Such other factors that need to be considered.
(2)Specified Acquisition
  1.  Maintenance of defense production and technological bases related to industries concerning national security (i.e. weapons, aircrafts, space and nuclear related industries, etc.)
  2.  Prevention of outflow of critical technologies to the national security.
  3.  Characteristics of the investor and its affiliate party(ies),such as, their nature, financing plan and record of performance of their investment, etc.
  4.  Such other factors that need to be considered.

Contact

Legal Office

International Bureau, Ministry of Finance, Japan

+81-3-3581-4111 (ext. 5410)