September 13, 2024
Ministry of Finance
Update of the List of Classifications of Listed Companies regarding the Prior-notification Requirements on Inward Direct Investment
The “List of classifications of listed companies regarding the prior-notification requirements on inward direct investment under the Foreign Exchange and Foreign Trade Act (the “FEFTA”)” is prepared to assist foreign investors in determining whether they need to submit a prior notification under FEFTA when making inward direct investments or equivalent actions in Japanese listed companies. Originally published in May 2020, this is the sixth update to the list.
Regarding the prior-notification requirements on inward direct investment, the list provides classifications of the companies into the following categories.
- Companies conducting business activities only in non-designated business sectors (subject to post-investment report only)(①);
- Companies conducting business activities in designated business sectors other than core sectors(②); or
- Companies conducting business activities in core business sectors(③)
The FEFTA Regulatory Notice, which was amended to add some Core Business Sectors to secure stable supply chains, came into force on August 16, 2024. The provisions of the revised Regulatory Notice shall apply to inward direct investments and equivalent actions to be made on or after September 15, 2024.
To update this list, we asked listed companies to cooperate with a survey to reflect not only the amendment of the Regulatory Notice but also newly listed and delisted companies and updates to their business activities. The list has been revised accordingly, based on the survey results, companies’ Articles of Incorporation, and their latest Annual Securities Reports.
(Note 1) Under FEFTA, foreign investors are required to determine whether or not prior notification is necessary. This list is prepared to assist investors in making such determinations. Please note that the classification in this list may differ from the actual classification at the time of investments since this list is based on survey data from listed companies and information from their Articles of Incorporation and Annual Securities Reports as of the update date.
(Note 2) Designated Business Sectors
Designated Business Sectors means the following industries designated in the public notice (Public Notice Specifying Business Sectors to Be Specified by the Minister of Finance and the Competent Minister for the Business Pursuant to the Provisions of Article 3, Paragraph (3) of the Order on Inward Direct Investment).
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Business sectors where inward direct investment or equivalent actions may undermine national security, disturb the maintenance of public order or interfere with the protection of public safety.
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Business sectors related to inward direct investment and equivalent actions that Japan has withheld pursuant to the provision of Article 2b of the OECD Codes of Liberalisation of Capital Movement
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(Note 3) Core Business Sectors
Core Business Sectors refer to specific industries designated from the viewpoint of national security, etc. in the public notice (Public Notice Specifying Business Sectors to Be Specified by the Minister of Finance and the Competent Minister for the Business Pursuant to the Provisions of Article 3-2, Paragraph (3) of the Order on Inward Direct Investment).
