Order for Enforcement of the Financial Instruments and Exchange Act(Cabinet Order No. 321 of 1965)
Last Version: Cabinet Order No. 309 of 2021
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Order for Enforcement of the Financial Instruments and Exchange Act (Any data that the title of a law indicates to be a "Tentative translation" has not yet been proofread or corrected by a native English speaker or legal translation expert; this data may be revised in the future.Tentative translation)
Cabinet Order No. 321 of September 30, 1965
The Cabinet enacts this Cabinet Order pursuant to the provisions of Article 2, paragraph (8), Article 3, paragraph (2), Article 32, item (i), Article 54, paragraph (2), Article 62, paragraph (3), Article 65, paragraph (1), Article 66, Article 120, Article 125, paragraph (3), Article 133, Article 193-2, paragraph (1), and Article 194 of the Securities and Exchange Act (Act No. 25 of 1948).
Chapter I General Provisions (Article 1 to Article 1-23)
Chapter II Disclosure of Corporate Affairs and Other Related Matters (Article 2 to Article 5)
Chapter III Disclosure Required for a Tender Offer
Section 1 Tender Offers for Share Certificates by Persons Other Than the Issuer (Article 6 to Article 14-3)
Section 2 Tender Offers for Listed Share Certificates by the Issuer (Article 14-3-2 to Article 14-3-13)
Chapter III-2 Disclosure of Status of Large Volume Holdings in Share Certificates (Article 14-4 to Article 14-9)
Chapter III-3 Special Rules on Procedures Undertaken Using an Electronic Data Processing System for Disclosure (Article 14-10 to Article 14-13)
Chapter III-4 Provision or Publication of Specified Information on Securities (Article 14-14)
Chapter III-5 Disclosure of Material Information (Article 14-15 to Article 14-17)
Chapter IV Financial Instruments Business Operators (Article 15 to Article 17-16)
Chapter IV-2 Financial Instruments Intermediary Service Providers (Article 18 to Article 18-4)
Chapter IV-3 Credit Rating Agencies (Article 18-4-2 to Article 18-4-8)
Chapter IV-4 High-Speed Traders (Article 18-4-9 to Article 18-4-13)
Chapter IV-5 Financial Instruments Firms Associations (Article 18-4-14 to Article 18-4-16)
Chapter IV-6 Investor Protection Funds (Article 18-5 to Article 18-15)
Chapter V Financial Instruments Exchanges (Article 19 to Article 19-3-16)
Chapter V-2 Foreign Financial Instruments Exchanges (Article 19-4)
Chapter V-3 Financial Instruments Clearing Organizations (Article 19-4-2 to Article 19-4-5)
Chapter V-4 Securities Finance Companies (Article 19-5 and Article 19-6)
Chapter V-5 Designated Dispute Resolution Organizations (Article 19-7 to Article 19-9)
Chapter V-6 Specified Financial Index Calculation Agents (Article 19-10 and Article 19-11)
Chapter VI Regulations on Transactions of Securities (Article 20 to Article 33-4-5)
Chapter VI-2 Administrative Monetary Penalties (Article 33-5 to Article 33-22)
Chapter VII Miscellaneous Provisions (Article 34 to Article 37-2)
Chapter VIII Delegation of Authority (Article 37-3 to Article 44-5)
Chapter IX Investigation into Criminal Cases (Article 45)
Supplementary Provisions
Chapter I General Provisions
(Instruments and Certificates Constituting Securities)
Article 1The instruments and certificates specified by Cabinet Order that are provided for in Article 2, paragraph (1), item (xxi) of the Financial Instruments and Exchange Act (hereinafter referred to as "the Act") are as follows:
(i)negotiable certificates of deposit (meaning one for which a due date for redemption is provided and which falls under a claim pertaining to negotiable instrument payable to order prescribed in Part III, Chapter 1, Section 7, Subsection 1 of the Civil Code (Act No. 89 of 1896), registered negotiable instruments payable to holder prescribed in Subsection 2 of that Section, other registered negotiable instruments prescribed in Subsection 3 of that Section, or claims for bearer instruments prescribed in Subsection 4 of that Section) that are issued by a foreign corporation;
(ii)instruments or certificates that an incorporated educational institution, etc. (meaning an incorporated educational institution as set forth in Article 3 of the Private Educational Institutions Act (Act No. 270 of 1949) or a corporation as prescribed in Article 64, paragraph (4) of that Act; the same applies hereinafter) issues through allotment, which indicate a monetary claim (limited to a monetary claim that falls under the claim prescribed in the preceding item) of which that incorporated educational institution, etc. is the obligor and which show the name of that incorporated educational institution, etc. and any other particulars specified by Cabinet Office Order.
(Membership Rights in a General Partnership Company or Limited Partnership Company That Are Deemed to Be Securities)
Article 1-2The membership rights specified by Cabinet Order that are provided for in Article 2, paragraph (2), item (iii) of the Act are as follows:
(i)membership rights in a general partnership company all of whose members fall under either of the following:
(a)a stock company; or
(b)a limited liability company; or
(ii)membership rights in a limited partnership company all of whose unlimited-liability members fall under either of the following:
(a)a stock company; or
(b)a limited liability company.
(Things Similar to Money)
Article 1-3The things specified by Cabinet Order that are provided for in Article 2, paragraph (2), item (v) of the Act are as follows:
(i)Securities;
(ii)bills of exchange;
(iii)promissory notes (excluding promissory notes that fall under what is set forth in item (i));
(iv)goods acquired by allocating the entire sum of money (including what is set forth in the preceding three items) invested or contributed by the person that holds the rights set forth in Article 2, paragraph (2), item (i), (ii), (v) or (vi) of the Act (limited to goods specified by Cabinet Office Order as those for which it is found to be necessary to ensure the protection of persons holding rights in them); and
(v)anything specified by Cabinet Office Order as being equivalent to what is set forth in the preceding items.
(Participation in an business subject to investment)
Article 1-3-2The cases specified by Cabinet Order that are provided for in Article 2, paragraph (2), item (v), (a) of the Act are cases that satisfy all of the following requirements:
(i)that business is executed in connection with the business subject to investment (meaning business subject to investment defined in Article 2, paragraph (2), item (v) of the Act; hereinafter the same applies in this Article and item (iv) of the following Article) only with the consent of all of the Equity Holders (meaning Equity Holders as defined in Article 2, paragraph (2), item (v) of the Act; hereinafter the same applies in this Article) (or, if an agreement has been reached that the consent of all of the Equity Holders is not required, that business is executed only after all of the Equity Holders have manifested whether or not it is their intention to consent to the decision on the execution of business); and
(ii)that all of the Equity Holders satisfy either of the following:
(a)they regularly engage in the business subject to investment; or
(b)they engage in the business subject to investment using a highly specialized ability that is indispensable to the continuation of the business subject to investment.
(Rights Whose Non-Treatment as Securities Is Found Not to Compromise the Public Interest)
Article 1-3-3The rights specified by Cabinet Order that are provided for in Article 2, paragraph (2), item (v), (d) of the Act are as follows:
(i)rights based on a contract connected with the business set forth in the items of Article 2, paragraph (1) of the Insurance Business Act (Act No. 105 of 1995);
(ii)rights connected with the investment or contribution made to a corporation established under Japanese laws and regulations (excluding general incorporated associations other than public interest incorporated associations and general incorporated foundations other than public interest incorporated foundations) (the rights indicated on the Securities set forth in Article 2, paragraph (1), items (vi) to (ix) and (xi) of the Act and the rights set forth in Article 2, paragraph (2), item (iii) of that Act which are deemed to be Securities pursuant to the provisions of Article 2, paragraph (2) of that Act are excluded);
(iii)rights based on the profit-sharing forestry contract prescribed in Article 2, paragraph (3) of the Act on Special Measures concerning Shared Forest (Act No. 57 of 1958);
(iv)rights based on a Partnership Contract, etc. (meaning a partnership contract set forth in Article 667, paragraph (1) of the Civil Code or other continuous contracts) to which only the following persons are party, if the business subject to investment connected with those rights is a business exclusively performing the services of the following persons:
(a)a certified public accountant;
(b)an attorney at law (including registered foreign lawyers);
(c)a judicial scrivener;
(d)a land and house investigator;
(e)a certified administrative procedures specialist;
(f)a certified tax accountant;
(g)a real property appraiser;
(h)a public consultant on social and labor insurance; and
(i)a patent attorney;
(v)rights based on a contract wherein an officer or employee, or any other person specified by Cabinet Office Order of the issuer of share certificates or Investment Securities (meaning Investment Securities as prescribed in the Act on Investment Trusts and Investment Corporations (Act No. 198 of 1951); hereinafter the same applies in this item) (hereinafter such persons are collectively referred to as the "Officer, etc." in this item and in Article 2-12-4, paragraph (2), item (iv)) promises to continually purchase share certificates or Investment Securities of the issuer jointly with another Officer, etc. of the issuer according to a fixed plan and without depending on an individual investment decision, which satisfies the requirements specified by Cabinet Office Order; and
(vi)anything specified by Cabinet Office Order as being equivalent to the rights set forth in the preceding items.
(Rights Deemed to be Securities)
Article 1-3-4The rights specified by Cabinet Order that are provided for in Article 2, paragraph (2), item (vii) of the Act are the claims connected with the loans made to an incorporated educational institution, etc. (limited to loans which satisfy all of the requirements set forth in the following items):
(i)the loans (excluding loans with no interest) are made by two or more persons and the rate, the time of performance, and any other particulars specified by Cabinet Office Order for the loans are the same; and
(ii)all or some of the loans fall under either of the following:
(a)the loan is made by a person other than one attending a School (meaning a school prescribed in Article 2, paragraph (1) of the Private Educational Institutions Act and including the advanced vocational school and vocational school prescribed in paragraph (2) of that Article) established by the incorporated educational institution, etc. that receives the loan or any other person specified by Cabinet Office Order as an interested person (referred to as the "Interested Person" in (b));
(b)it is not prohibited to transfer the claim associated with the loan to a person other than an Interested Person;
(iii)all or some of the loans fall under either of the following:
(a)the loan is made by a person other than a bank or any other person permitted to make that loan in the course of trade pursuant to the provisions of laws and regulations (referred to as a "Bank, etc." in (b)); or
(b)it is not prohibited to transfer the claim associated with the loan to a person other than a Bank, etc. (including a claim management and collection company as prescribed in Article 2, paragraph (3) of the Act on Special Measures Concerning Claim Management and Collection Businesses (Act No. 126 of 1998)).
(Cases in Which the Relevant Securities Are Not Likely to Be Transferred to Persons Other Than Qualified Institutional Investors through the Solicitation For Acquisition)
Article 1-4The case specified by Cabinet Order as one in which there is little likelihood of the relevant Securities being transferred, as provided in Article 2, paragraph (3), item (i) of the Act, and the case specified by Cabinet Order that is provided for in the provisions of Article 2, paragraph (3), item (ii), (a) and Article 2-3, paragraph (4), item (ii), (a) of the Act mean a case as specified in the relevant of the following items for the category of Securities set forth in those items:
(i)share certificates (including Securities set forth in Article 1, paragraph (2), item (xvii) of the Act which have the nature of share certificates, preferred equity securities as provided in the Act on Preferred Equity Investment by cooperative financial institution (Act No. 44 of 1993; hereinafter referred to as the "Act on Preferred Equity Investment") (such preferred equity securities are referred to as "Preferred Equity Securities" except in this item and the following item), preferred equity securities as set forth in the Act on Securitization of Assets (Act No. 105 of 1998; hereinafter referred to as the "Asset Securitization Act") and the Securities prescribed in Article 1, paragraph (2), item (xvii) of the Act which have the nature of those Securities, investment securities and foreign investment securities which are securities similar to investment securities as provided in the Act on Investment Trusts and Investment Corporations (hereinafter such securities are collectively referred to as "Investment Securities, etc."); hereinafter the same applies in (a) of the following item, Article 1-5-2, paragraph (2), item (ii), (a), Article 1-7, item (ii), (b), 1., Article 1-7-4, item (ii), (a), Article 1-8-2, item (ii), (a) and Article 1-8-4, item (iii), (b), 1.), and the Securities set forth in Article 2, paragraph (1), item (xvii) of the Act which have the nature of the Securities set forth in Article 2, paragraph (1), item (vi) of the Act (hereinafter such Securities are referred to as "Share Certificates, etc." in this item, Article 1-5-2, paragraph (2), item (i), Article 1-7, item (ii), (a), Article 1-7-4, item (i), Article 1-8-2, item (i), Article 1-8-4, item (iii), (a), Article 2-4-2, item (ii), (a) and Article 2-6-2, item (ii), (a)): a case meeting all of the following requirements:
(a)the issuer of those Share Certificates, etc. is not a person that has already issued Share Certificates, etc. indicating the same features as those Share Certificates, etc. (limited to features with regard to the payment of the dividends of surplus, distribution of residual assets, cancellation of equity by using profits, or the cancellation of preferred equity investment under Article 15, paragraph (1) of the Act on Preferred Equity Investment (limited to the part that involves item (ii)) which are related to shares (including preferred equity investment as provided in the Act on Preferred Equity Investment and the preferred equity set forth in the Asset Securitization Act) or equity) which fall under any of the items of Article 24, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act);
(b)what is specified by Cabinet Office Order as being a Security of the same type as those Share Certificates, etc. is not a Security for Professional Investors (meaning Securities for Professional Investors as defined in Article 4, paragraph (3) of the Act; the same applies hereinafter); and
(c)the requirements specified in the relevant of 1. or 2. below are satisfied for the category of cases set forth in 1. or 2. below:
1.cases in which rights associated with the Share Certificates, etc. are indicated on financial values which can be transferred by using an electronic data processing system (limited to that which is recorded on an electronic device or any other object by electronic means; the same applies hereinafter) (excluding the cases specified by Cabinet Office Order; the same applies in Article 1-5-2, paragraph (2), item (i), (b), 1. and item (ii), (b), 1., Article 1-7-4, item (i), (c), 1., Article 1-8-2, item (i), (b), 1. and (ii), (b), 1, and Article 15-10-6, item (i)): technical measures have been taken to make it impossible to transfer that financial values to persons other than Qualified Institutional Investors (meaning the Qualified Institutional Investors prescribed in Article 2, paragraph (3), item (i) of the Act; the same applies hereinafter);
2.cases other than those set forth in 1. above: the solicitation for acquisition (meaning solicitation for acquisition as prescribed in Article 2, paragraph (3) of the Act; the same applies hereinafter) is done or Procedures Related to the Issuance of Securities During a Reorganization (meaning the Procedures Related to the Issuance of Securities During a Reorganization as prescribed in Article 2-3, paragraph (2) of the Act; the same applies in Article 1-7-3, item (vii) and Article 2-4-2, item (i)) are taken in a way that makes the acquisition of the Share Certificates, etc. conditional upon the conclusion of a contract for their transfer which provides that the person acquiring the Share Certificates, etc. will not transfer them to persons other than Qualified Institutional Investors;
(ii)Share option certificates and share options, Rights to Subscribe for Preferred Equity (meaning the Right to Subscribe for Preferred Equity set forth in the Asset Securitization Act; the same applies hereinafter) or Securities with the rights of conversion into Preferred Equity Securities prescribed in the Asset Securitization Act, Securities set forth in Article 2, paragraph (1), item (xvii) of the Act which have the nature of those Securities, and Investment Equity Subscription Right Certificates (meaning Investment Equity Subscription Right Certificates as prescribed in the Act on Investment Trusts and Investment Corporations; hereinafter the same applies) and foreign investment securities as prescribed in the Act on Investment Trusts and Investment Corporations which are similar to Investment Equity Subscription Right Certificates (hereinafter referred to as "Investment Equity Subscription Right Certificates, etc.") (excluding Securities set forth in Article 2, paragraph (1), item (xix) of the Act; hereinafter referred to as "Share Option Certificates, etc." in this item, Article 1-5-2, paragraph (2), item (ii), Article 1-7, item (ii), (b), Article 1-7-4, item (ii), Article 1-8-2, item (ii), Article 1-8-4, item (iii), (b), Article 2-4-2, item (ii), (b), Article 2-6-2, item (ii), (b) and Article 2-12-3, item (v)): a case meeting all of the following requirements:
(a)the issuer of the share certificates which that would be acquired, subscribed for or converted through the exercise of the rights indicated on the Share Option Certificates, etc., and the share certificates, share option certificates, and Investment Equity Subscription Right Certificates satisfy the requirements set forth in (a) and (b) of the preceding item, respectively;
(b)the issuer of the Share Option Certificates, etc. (excluding share option certificates and Investment Equity Subscription Right Certificates; hereinafter the same applies in (b) and (c)) is not a person that has already issued anything specified by Cabinet Office Order as being a Security of the same type as those Share Option Certificates, etc. and that falls under any of the items of Article 24, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act);
(c)what is specified by Cabinet Office Order as being a Security of the same type as the relevant Share Option Certificates, etc. is not a Security for Professional Investors; and
(d)a restriction has been placed on the relevant Share Option Certificates, etc. (if those Share Option Certificates, etc. are Specified Corporate Bond Certificates with a Right to Subscribe for Preferred Equity (meaning the Specified Corporate Bond Certificate with a Right to Subscribe for Preferred Equity as provided in the Asset Securitization Act; the same applies hereinafter) and the Right to Subscribe for Preferred Equity may be transferred independently from the Specified Corporate Bond Certificates (meaning Specified Corporate Bond Certificates as provided in the Asset Securitization Act; the same applies hereinafter), the Specified Corporate Bond Certificates and the Certificate of a Right to Subscribe for Preferred Equity (meaning a Certificate of a Right to Subscribe for Preferred Equity as provided in the Asset Securitization Act; the same applies hereinafter) issued therewith), as per the formalities specified by Cabinet Office Order, prohibiting the person that has acquired or purchased the Share Option Certificates, etc. from transferring them other than to a Qualified Institutional Investor, or the Share Option Certificates, etc. otherwise satisfy the requirements specified by Cabinet Office Order as being equivalent to this;
(iii)Securities other than the Securities set forth in the preceding two items: a case meeting all of the following requirements:
(a)the issuer of the relevant Securities is not a person that has already issued anything that is specified by Cabinet Office Order as being a Security of the same type as those Securities and that falls under any of the items of Article 24, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act);
(b)what is specified by Cabinet Office Order as being a Security of the same type as the relevant Securities is not a Security for Professional Investors; and
(c)the Securities meet the requirements specified by Cabinet Office Order in accordance with the preceding item.
(Cases in Which a Large Number of Persons Are Party to a Solicitation)
Article 1-5The cases specified by Cabinet Order as those in which the transaction is conducted with a large number of persons as the other parties thereto as provided in Article 2, paragraph (3), item (i) of the Act are cases in which the solicitation for acquisition Securities is conducted with not less than 50 persons as the other parties thereto.
(Cases in Which the Relevant Securities Are Not Likely to Be Transferred to Persons Other Than Professional Investors through the solicitation for acquisition)
Article 1-5-2(1)The persons specified by Cabinet Order that are provided for in Article 2, paragraph (3), item (ii), (b), 2. of the Act are persons falling under either of the following:
(i)Non-Residents (meaning non-residents as defined in Article 6, paragraph (1), item (vi) of the Foreign Exchange and Foreign Trade Act (Act No. 228 of 1949); the same applies hereinafter) that acquire the relevant Securities from Residents (meaning the residents set forth in the first sentence of Article 6, paragraph (1), item (v) of that Act; the same applies hereinafter) through the intermediation, brokerage, or agency of a Security Related Business Entity (meaning a Financial Instruments Business Operator, etc. (meaning a Financial Instruments Business Operator, etc. as prescribed in Article 34 of the Act; hereinafter the same applies except in Article 44) or a Foreign Securities Services Provider (meaning a Foreign Securities Services Provider as prescribed in Article 58 of the Act; the same applies hereinafter); the same applies in the following item); or
(ii)Non-Residents that acquire the relevant Securities from Security Related Business Entities or another Non-Resident.
(2)The case specified by Cabinet Order that is provided for in Article 2, paragraph (3), item (ii), (b), 2. of the Act means a case as specified in the relevant of the following items for the category of Securities set forth in that item:
(i)share certificates: a case meeting all of the following requirements:
(a)what is specified by Cabinet Office Order as being a Security of the same type as the relevant Share Certificates, etc. does not fall under the category of any of the Securities set forth in the items of Article 24, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act); and
(b)the requirements specified in the relevant of 1. or 2. below are satisfied for the category of cases set forth in 1. or 2. below:
1.cases in which rights associated with the Share Certificates, etc. are indicated on financial values which can be transferred by using an electronic data processing system: technical measures or other measures specified by Cabinet Office Order have been taken to make it impossible to transfer that financial values to persons other than Professional Investors, etc. (meaning the Professional Investors, etc. prescribed in Article 2, paragraph (3), item (ii), (b), 2. of the Act; the same applies hereinafter);
2.cases other than those set forth in 1. above: the solicitation for acquisition is done in a way that makes the acquisition of the Share Certificates, etc. conditional upon the conclusion of a contract for their transfer between the issuer of the Share Certificates, etc. and the person that seeks to acquire the Share Certificates, etc. in response to the solicitation for acquisition them (hereinafter such a person is referred to as the "Acquirer" in this item); as well as between the person that makes the solicitation for acquisition and the Acquirer; which provides that the Acquirer of the Share Certificates, etc. will not transfer them to persons other than Professional Investors, etc. and provides for any other particulars specified by Cabinet Office Order;
(ii)Share Option Certificates, etc.: a case meeting all of the following requirements:
(a)the share certificates that would be acquired, subscribed for or converted through the exercise of the rights indicated on the Share Option Certificates, etc. satisfy the requirements set forth in (a) of the preceding item;
(b)the requirements specified in the relevant of 1. or 2. below are satisfied for the category of cases set forth in 1. or 2. below:
1.cases in which rights associated with the Share Option Certificates, etc. are indicated on financial values which can be transferred by using an electronic data processing system: technical measures or other measures specified by Cabinet Office Order have been taken to make it impossible to transfer that financial values to persons other than Professional Investors, etc.;
2.cases other than those set forth in 1. above: the solicitation for acquisition is done in a way that makes the acquisition of the Share Option Certificates, etc. conditional upon the conclusion of a contract for transfer between the issuer of the Share Option Certificates, etc. (if the Share Option Certificates, etc. are Specified Corporate Bond Certificates with Rights to Subscribe for Preferred Equity and the Rights to Subscribe for Preferred Equity may be transferred independently from the Specified Corporate Bond Certificate, the Specified Corporate Bond Certificate and the Certificate of a Right to Subscribe for Preferred Equity issued therewith) and the person that seeks to acquire the Share Option Certificates, etc. in response to the solicitation for acquisition them (hereinafter such a person is referred to as the "Acquirer" in this item); as well as between the person that makes the solicitation for acquisition and the Acquirer; which provides that the Acquirer will not transfer the Share Option Certificates, etc. acquired thereby to persons other than Professional Investors, etc. and provides for any other particulars specified by Cabinet Office Order;
(iii)Securities other than the Securities set forth in the preceding two items: a case meeting the requirements specified by Cabinet Office Order in accordance with the preceding item.
(Requirements for a Solicitation For Acquisition Not to Constitute Solicitation to a Small Number of Investors)
Article 1-6The requirement specified by Cabinet Order that is provided for in Article 2, paragraph (3), item (ii), (c) of the Act is that the other Securities specified by Cabinet Office Order as being Securities of the same type as the referenced Securities (excluding Securities for which the solicitation for acquisition fell under the case set forth in Article 2, paragraph (3), item (ii), (a) of the Act and the case set forth in Article 2-12 at the time of issuance and Securities for which the solicitation for acquisition fell under the category of a public offering of Securities at the time of its issuance and for which the notification under Article 4, paragraph (1) of the Act has been made or Supplements to Shelf Registration Documents prescribed in Article 23-8, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act) have been submitted with regard to the public offering of those Securities; hereinafter referred to as the "Newly Issued Securities of the Same Type" in this Article) have been issued within six months prior to the day on which the relevant Securities are issued, and the total number of persons to which the solicitation for acquisition those Securities is to be made (if the solicitation for acquisition the Securities is made to Qualified Institutional Investors and the Securities fall under the cases specified in Article 1-4, the Qualified Institutional Investors are excluded from the total) and the persons to which the solicitation for acquisition Newly Issued Securities of the Same Type which have been issued within six months prior to the day on which the relevant Securities are issued, has been made (if the solicitation for acquisition the Newly Issued Securities of the Same Type is made to Qualified Institutional Investors and the Newly Issued Securities of the Same Type fall under the cases specified in Article 1-4, the Qualified Institutional Investors are excluded) is not less than 50 persons.
(Cases in Which the Solicitation For Acquisition Constitutes Solicitation to a Small Number of Investors)
Article 1-7The cases specified by Cabinet Order that are provided for in Article 2, paragraph (3), item (ii), (c) of the Act are cases meeting all of the following requirements:
(i)the solicitation for acquisition is not made only to Professional Investors (meaning Professional Investors as defined in Article 2, paragraph (31) of the Act; the same applies hereinafter) of which there are not less than 50 persons (if those persons are Qualified Institutional Investors and the Securities involved in the solicitation for acquisition fall under the cases specified in Article 1-4, those persons are excluded);
(ii)the requirements specified in the relevant of (a) to (c) below are satisfied for the category of Securities set forth in that item:
(a)Share Certificates, etc.: All of the following requirements are satisfied:
1.the issuer of the Share Certificates, etc. is not a person that has already issued Share Certificates, etc. indicating the same features as those Share Certificates, etc. (limited to features with regard to the payment of the dividends of surplus, distribution of residual assets, cancellation of equity by using profits, or the cancellation of preferred equity investment under Article 15, paragraph (1) of the Act on Preferred Equity Investment (limited to the part that involves item (ii)) which are related to shares (including preferred equity investment as provided in the Act on Preferred Equity Investment and the preferred equity set forth in the Asset Securitization Act) or equity) and that fall under any of the items of Article 24, paragraph (1) (including as applied mutatis mutandis pursuant to Article 27 of the Act); and
2.what is specified by Cabinet Office Order as being a Security of the same type as the relevant Share Certificates, etc. is not a Security for Professional Investors;
(b)Share Option Certificates, etc.: All of the following requirements are satisfied:
1.the issuer of the share certificates that would be acquired, subscribed for or converted through the exercise of the rights indicated on the Share Option Certificates, etc., and the share certificates, share option certificates, and Investment Equity Subscription Right Certificates satisfy the requirements set forth in (a), 1. and 2. respectively;
2.the issuer of the Share Option Certificates, etc. (excluding share option certificates and Investment Equity Subscription Right Certificates; hereinafter the same applies in (b)) is not a person that has already issued anything that is specified by Cabinet Office Order as being a Security of the same type as the relevant Share Option Certificates, etc. and that falls under any of the items of Article 24, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act);
3.what is specified by Cabinet Office Order as being a Security of the same type as the relevant Share Option Certificates, etc. is not a Security for Professional Investors; and
4.a restriction has been placed on the Share Option Certificates, etc. (if those Share Option Certificates, etc. are Specified Corporate Bond Certificates with a Right to Subscribe for Preferred Equity and the Right to Subscribe for Preferred Equity may be transferred independently from the Specified Corporate Bond Certificates, the Specified Corporate Bond Certificate and the Certificate of a Right to Subscribe for Preferred Equity issued therewith), as per the formalities specified by Cabinet Office Order, prohibiting the person that has acquired or purchased the Share Option Certificates, etc. (if the person that has acquired or purchased the Share Option Certificates, etc. is a Qualified Institutional Investor and the Share Option Certificates, etc. fall under the cases specified in Article 1-4, that Qualified Institutional Investor is excluded) from transferring them unless doing so all at once to another single person, or the Share Option Certificates, etc. otherwise satisfy the requirements specified by Cabinet Office Order as being equivalent to this;
(c)Securities other than the Securities set forth in (a) and (b): All of the following requirements are satisfied:
1.the issuer of the Securities is not a person that has already issued anything that is specified by Cabinet Office Order as being a Security of the same type as the relevant Securities and that falls under any of the items of Article 24, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act);
2.what is specified by Cabinet Office Order as being a Security of the same type as the relevant Securities is not a Security for Professional Investors; and
3.the Securities meet the requirements specified by Cabinet Office Order in accordance with (b).
(Cases in Which Securities Come to Be Owned by a Considerably Large Number of Persons through a Solicitation For Acquisition)
Article 1-7-2The case specified by Cabinet Order that is provided for in Article 2, paragraph (3), item (iii) of the Act is a case in which the relevant person conducts solicitation for acquisition that causes not less than 500 persons to own the Securities related to that solicitation for acquisition.
(Transactions of Securities Which Are Not Secondary Distributions of Securities)
Article 1-7-3The transactions of Securities specified by Cabinet Order that are provided for in Article 2, paragraphs (4) and (6) of the Act are transactions falling under any of the following items:
(i)the purchase and sale of Securities on a Financial Instruments Exchange Market;
(ii)the purchase and sale of Securities on an Over-the-Counter Securities Market (meaning Over-the-Counter Securities Market as defined in Article 67, paragraph (2) of the Act; the same applies hereinafter);
(iii)the purchase and sale of Securities (limited to those listed on a Financial Instruments Exchange or Over-the-Counter Traded Securities (meaning Over-the-Counter Traded Securities as defined in Article 2, paragraph (8), item (x), (c) of the Act; the same applies hereinafter)) through the acts set forth in Article 2, paragraph (8), item (x) of the Act (if the Securities are Specified Listed Securities (meaning Specified Listed Securities as defined in Article 2, paragraph (33) of the Act; the same applies hereinafter), limited to a purchase and sale to which only Professional Investors, etc. are party);
(iv)the purchase and sale of Securities (limited to Securities that fall under Article 24, paragraph (1), item (i) of the Act) conducted by a Financial Instruments Business Operator, etc. or Professional Investor with another Financial Instruments Business Operator, etc. or Professional Investor without relying on a Financial Instruments Exchange Market at an appropriate price considering the circumstances surrounding securities transactions based on the trading price of the Securities on a Financial Instruments Exchange Market for the formation of a fair price and facilitation of smooth distribution of the Securities;
(v)the selling of the relevant Securities, which have already been issued in a foreign state by a Foreign Securities Services Provider pursuant to the provisions of the proviso to Article 58-2 of the Act to a Financial Instruments Business Operator, etc. or Qualified Institutional Investor (including Securities prescribed in Article 2-12-2, limited to solicitation for selling, etc., etc. (meaning solicitation for selling, etc., etc. as defined in Article 2, paragraph (4) of the Act; the same applies hereinafter) falling under the cases specified in Article 2, paragraph (4), item (ii), (a) to (c) or Procedures Relating to Securities Delivery for Reorganization (meaning Procedures Related to the Delivery of Securities During a Reorganization as defined in Article 2-3, paragraph (3) of the Act; the same applies hereinafter) falling under the case specified in Article 2-3, paragraph (5), item (ii), (a) or (b) which have not been conducted; referred to as "Foreign Securities with No Restriction on Transfer" in the following Article and Article 1-8-4, item (iv));
(vi)the Selling of Foreign Securities with No Restriction on Transfer by the Financial Instruments Business Operator, etc. or Qualified Institutional Investor that has acquired them (hereinafter referred to as "Selling Financial Instruments Business Operator, etc." in this item) to another Financial Instruments Business Operator, etc. (limited to one purchasing the Foreign Securities with No Restriction on Transfer for the purpose of having them acquired by other persons; hereinafter referred to as "Purchasing Financial Instruments Business Operator, etc." in this item) (limited to sales by a Selling Financial Instruments Business Operator, etc. or Purchasing Financial Instruments Business Operator, etc. that is a member of an Authorized Financial Instruments Firms Association (limited to an Authorized Financial Instruments Firms Association designated by the Commissioner of the Financial Services Agency; hereinafter the same applies in this item and Article 1-8-4, item (iv))), in which the issues, number and other particulars of those Foreign Securities with No Restriction on Transfer specified by Cabinet Office Order is reported by the Selling Financial Instruments Business Operator, etc. (if the Selling Financial Instruments Business Operator, etc. is not a member of an Authorized Financial Instruments Firms Association, the Purchasing Financial Instruments Business Operator, etc.) to the Authorized Financial Instruments Firms Association;
(vii)the purchase and sale of Securities for which solicitation for acquisition falling under the cases specified in Article 2, paragraph (3), item (ii), (a) to (c) of the Act, solicitation for selling, etc., etc. falling under the cases specified in Article 2, paragraph (4), item (ii), (a) to (c) of the Act, Procedures Related to the Issuance of Securities During a Reorganization falling under the cases specified in Article 2-3, paragraph (4), item (ii), (a) or (b) of the Act or Procedures Related to the Delivery of Securities During a Reorganization falling under the cases specified in Article 2-2, paragraph (5), item (ii), (a) or (b) of the Act have not been conducted (hereinafter referred to as "Securities with No Restriction on Transfer" in this item and the following item) and owned by a person other than the following persons:
(a)the Issuer of the Securities with No Restriction on Transfer;
(b)an Officer (meaning a director, executive officer, accounting advisor and company auditor (including board members, auditors and persons equivalent thereto); hereinafter the same applies in this item) or incorporator of the corporation (including foreign corporation; hereinafter the same applies in this item) that is the Issuer of the Securities with No Restriction on Transfer or any other person equivalent thereto (excluding the incorporator and any other person equivalent thereto, if there was a period during which that person was not the officer, shareholder, or other member of that corporation after its establishment, and that period exceeds five continuous years);
(c)a Major Shareholder (meaning a Major Shareholder as defined in Article 163, paragraph (1) of the Act; hereinafter the same applies in (c)) of the corporation that is the Issuer of the Securities with No Restriction on Transfer or an officer or incorporator of the Major Shareholder (limited to cases in which the Major Shareholder is a corporation) or any other person equivalent thereto (excluding the incorporator and any other person equivalent thereto, if there was a period during which that person was not the officer, shareholder, or other member of the corporation that constitutes that Major Shareholder after its establishment, and that period exceeds five continuous years);
(d)a Subsidiary Company, etc. (meaning Subsidiary Company as defined in Article 29-4, paragraph (4) of the Act or any other corporation equivalent thereto; hereinafter the same applies in (d)) of the corporation that is the Issuer of the Securities with No Restriction on Transfer, or an officer or incorporator of that Subsidiary Company, etc. or any other person equivalent thereto (excluding the incorporator and any other person equivalent thereto, if there was a period during which that person was not the officer, shareholder, or other member of that Subsidiary Company, etc. after its establishment, and that period exceeds five continuous years); or
(e)a Financial Instruments Business Operator, etc.;
(viii)the purchase and sale of Securities with No Restriction on Transfer (limited to those in which both parties to the purchase and sale are persons set forth in (a) to (e) of the preceding item (excluding those in which both parties are persons specified in (e) of that item));
(ix)a purchase and sale of Securities (limited to corporate bond certificates and other Securities specified by Cabinet Office Order) on condition of repurchase or resale in which the repurchase price or resale price and the repurchase date or resale date are set in advance;
(x)the selling of Securities to the Issuer or a person that seeks to sell the Securities to the Issuer (including those that seek to sell the Securities to that person); or
(xi)the purchase and sale of Securities associated with the brokering of the purchase and sale of Securities by a Financial Instruments Business Operator, etc. for a customer in a Financial Instruments Exchange Market or Foreign Financial Instruments Market (meaning Foreign Financial Instruments Market as defined in Article 2, paragraph (8), item (iii), (b) of the Act; the same applies hereinafter).
(Cases in Which the Relevant Securities Are Not Likely to Be Transferred to Persons Other Than Qualified Institutional Investors through the Solicitation for selling, etc.)
Article 1-7-4The case specified by Cabinet Order as one in which there is little likelihood of the relevant Securities being transferred as prescribed in Article 2, paragraph (4), item (i) of the Act, and the case specified by Cabinet Order that is provided for in the provisions of Article 2, paragraph (4), item (ii), (a) and Article 2-3, paragraph (5), item (ii), (a) of the Act mean a case as specified in the following items according to the category of Securities set forth in that item:
(i)Share Certificates, etc.: a case meeting all of the following requirements:
(a)the issuer of the Share Certificates, etc. is not a person that has already issued Share Certificates, etc. indicating the same features as those Share Certificates, etc. (limited to features with regard to the payment of the dividends of surplus, distribution of residual assets, cancellation of equity by using profits, or the cancellation of preferred equity investment under Article 15, paragraph (1) of the Act on Preferred Equity Investment (limited to the part that involves item (ii)) which are related to shares (including preferred equity investment as provided in the Act on Preferred Equity Investment and the preferred equity set forth in the Asset Securitization Act) or equity) and which fall under any of the items of Article 24, paragraph (1) (including as applied mutatis mutandis pursuant to Article 27 of the Act);
(b)what is specified by Cabinet Office Order as being a Security of the same type as the relevant Share Certificates, etc. is not a Security for Professional Investors; and
(c)the requirements specified in the relevant of 1. or 2. below are satisfied for the category of cases set forth in 1. or 2. below:
1.cases in which rights associated with the Share Certificates, etc. are indicated on financial values which can be transferred by using an electronic data processing system: technical measures have been taken to make it impossible to transfer that financial values to persons other than Qualified Institutional Investors;
2.cases other than those set forth in 1. above: the solicitation for selling, etc. Is made or procedures related to the delivery of securities during a reorganization are taken in a way that makes the acquisition of the share certificates, etc. Conditional upon the conclusion of a contract for their transfer which provides that the person acquiring the share certificates, etc. will not transfer them to persons other than qualified institutional investors;
(ii)Share Option Certificates, etc.: a case meeting all of the following requirements:
(a)the issuer of the share certificates that would be acquired, subscribed for or converted through the exercise of the rights indicated on the Share Option Certificates, etc., and the share certificates, share option certificates, and Investment Equity Subscription Right Certificates satisfy the requirements set forth in (a) and (b) respectively, of the preceding item;
(b)the issuer of the Share Option Certificates, etc. (excluding share option certificates and Investment Equity Subscription Right Certificates; hereinafter the same applies in (b) and (c)) is not a person that has already issued anything specified by Cabinet Office Order as being a Security of the same type as the relevant Share Option Certificates, etc. and that falls under any of the items of Article 24, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act);
(c)what is specified by Cabinet Office Order as being a Security of the same type as the relevant Share Option Certificates, etc. is not a Security for Professional Investors; and
(d)a restriction has been placed on the Share Option Certificates, etc. (if those Share Option Certificates, etc. are Specified Corporate Bond Certificates with a Right to Subscribe for Preferred Equity and the Right to Subscribe for Preferred Equity may be transferred independently from the Specified Corporate Bond Certificates, the Specified Corporate Bond Certificates and the Certificate of a Right to Subscribe for Preferred Equity issued therewith), as per the formalities specified by Cabinet Office Order, prohibiting the person that has acquired or purchased the Share Option Certificates, etc. from transferring them other than to a Qualified Institutional Investor, or the Share Option Certificates, etc. otherwise satisfy the requirements specified by Cabinet Office Order as being equivalent to this;
(iii)Securities other than the Securities set forth in the preceding two items: a case meeting all of the following requirements:
(a)the issuer of the Securities is not a person that has already issued anything specified by Cabinet Office Order as being a Security of the same type as the relevant Securities which falls under any of the items of Article 24, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act);
(b)what is specified by Cabinet Office Order as being a Security of the same type as the relevant Securities is not a Security for Professional Investors; and
(c)the Securities meet the requirements specified by Cabinet Office Order in accordance with the preceding item.
(Cases in Which a Large Number of Persons Are the Other Parties to a Transaction)
Article 1-8The cases specified by Cabinet Order as those in which the transaction is conducted with a large number of persons as the other parties thereto as provided in Article 2, paragraph (4), item (i) of the Act are cases in which the solicitation for acquisition is conducted with not less than 50 persons as the other parties thereto.
(Cases in Which the Relevant Securities Are Not Likely to Be Transferred to Persons Other Than Professional Investors through an Solicitation for selling)
Article 1-8-2The cases specified by Cabinet Order that are provided for in Article 2, paragraph (4), item (ii), (b), 2. of the Act are a case as specified in the relevant of the following items for the category of Securities set forth in those items:
(i)Share Certificates, etc.: a case meeting all of the following requirements:
(a)what is specified by Cabinet Office Order as being a Security of the same type as those Share Certificates, etc. does not fall under the category of any of the Securities set forth in the items of Article 24, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act); and
(b)the requirements specified in the relevant of 1. or 2. below are satisfied for the category of cases set forth in 1. or 2. below:
1.cases in which rights associated with the Share Certificates, etc. are indicated on financial values which can be transferred by using an electronic data processing system: technical measures or other measures specified by Cabinet Office Order have been taken to make it impossible to transfer that financial values to persons other than Professional Investors, etc.;
2.cases other than those set forth in 1. above: the solicitation for selling, etc. is made in a way that makes the purchase of the share certificates, etc. conditional upon the conclusion of a contract for their transfer between the person making the solicitation for selling, etc. the share certificates, etc. and the person seeking to purchase those share certificates, etc. In response to the solicitation for selling, etc. them (hereinafter such a person is referred to as the "Purchaser" in this item) which provides that the purchaser will not transfer the share certificates, etc. purchased thereby to persons other than professional investors, etc., and prescribes any other particulars specified by Cabinet Office Order;
(ii)Share Option Certificates, etc.: a case meeting all of the following requirements:
(a)the share certificates that would be acquired, subscribed for or converted through the exercise of the rights indicated on the Share Option Certificates, etc. satisfy the requirements set forth in (a) of the preceding item; and
(b)the requirements specified in the relevant of 1. or 2. below are satisfied for the category of cases set forth in 1. or 2. below:
1.cases in which rights associated with the Share Option Certificates, etc. are indicated on financial values which can be transferred by using an electronic data processing system: technical measures or other measures specified by Cabinet Office Order have been taken to make it impossible to transfer that financial values to persons other than Professional Investors, etc.;
2.cases other than those set forth in 1. above: the solicitation for selling, etc. is made in a way that makes the purchase of the Share Option Certificates, etc. conditional upon the conclusion of a contract for their transfer between the person making the solicitation for selling, etc. the share option certificates, etc. (or, if the share option certificates, etc. are specified corporate bond certificates with rights to subscribe for preferred equity and the rights to subscribe for preferred equity may be transferred independently from the specified corporate bond certificates, the specified corporate bond certificate and the certificate of a right to subscribe for preferred equity issued therewith) and the person seeking to purchase those share option certificates, etc. in response to the solicitation for selling, etc. them (hereinafter such a person is referred to as the "Purchaser" in this item) which provides that the purchaser will not transfer the share option certificates, etc. purchased thereby to persons other than professional investors, etc., and prescribes any other particulars specified by Cabinet Office Order; and
(iii)Securities other than the Securities set forth in the preceding two items: the Securities meet the requirements specified by Cabinet Office Order in accordance with the preceding item.
(Requirements for an Solicitation for selling Not to Constitute Solicitation to a Small Number of Investors)
Article 1-8-3The requirement specified by Cabinet Order that is provided for in Article 2, paragraph (4), item (ii), (c) of the Act is that the solicitation for selling, etc. (excluding transactions referred to in the items of Article 1-7-3; hereinafter the same applies in this article) other securities specified by Cabinet Office Order as being of the same type as the relevant securities (excluding the following Securities; hereinafter referred to as "Already Issued Securities of the Same Type" in this article) has been made within one month prior to the day on which the solicitation for selling, etc. the relevant securities is made, and the total number of persons to which the solicitation for selling, etc. the relevant securities is to be made (if the solicitation for selling, etc. the Securities is made to Qualified Institutional Investors and the Securities fall under the cases specified in Article 1-7-4, the Qualified Institutional Investors are excluded) and the persons to which the solicitation for selling, etc. Already Issued Securities of the Same Type has been made within one month prior to the day on which the solicitation for selling, etc. of the Securities is made (if the solicitation for selling, etc. Already Issued Securities of the Same Type is made to Qualified Institutional Investors and the Already Issued Securities of the Same Type fall under the cases specified in Article 1-7-4, the Qualified Institutional Investors are excluded) is not less than 50 persons:
(i)Securities for which the solicitation for selling, etc. fell under the case set forth in Article 2, paragraph (4), item (ii), (a) of the Act at the time of the solicitation for selling, etc. them;
(ii)Securities for which the solicitation for selling, etc. fell under the case set forth in Article 2-12 at the time of the solicitation for selling, etc. them;
(iii)Securities for which the solicitation for selling, etc. corresponded to a Secondary Distribution of Securities at the time of the solicitation for selling, etc. them, and with regard to which a notification under Article 4, paragraph (1) of the Act has been given or the Supplements to Shelf Registration Documents defined in Article 23-8, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act) have been submitted for that Secondary Distribution of Securities;
(iv)Securities for which the Solicitation for selling, etc. corresponded to a Secondary Distribution of Foreign Securities prescribed in Article 27-32-2, paragraph (1) of the Act at the time of the solicitation for selling, etc. them, and for which Foreign Securities Information (meaning Foreign Securities Information as defined in that paragraph; the same applies hereinafter) was provided or publicized pursuant to the provisions of that paragraph (including Securities falling under the provisions of the proviso to that paragraph).
(Cases in Which an Solicitation for selling Constitutes Solicitation to a Small Number of Investors)
Article 1-8-4The cases specified by Cabinet Order that are provided for in Article 2, paragraph (4), item (ii), (c) of the Act are cases meeting all of the following requirements:
(i)the solicitation for selling, etc. is not made only to Professional Investors, and it is not a case in which 50 or more persons (if those persons are Qualified Institutional Investors and the Securities involved in the solicitation for selling, etc. fall under the cases specified in Article 1-7-4, those persons are excluded) are the other parties to the solicitation for selling, etc.;
(ii)if a solicitation for selling, etc. Securities satisfying the requirements specified in Article 1-7, item (ii) is being made, the solicitation for selling, etc. is carried out in accordance with those requirements;
(iii)if a solicitation for selling, etc. Securities other than the Securities set forth in the preceding item is being made, the requirements specified in the relevant of (a) to (c) below are satisfied for the category of Securities set forth in (a) to (c):
(a)Share Certificates, etc.: All of the following requirements are satisfied:
1.the issuer of the Share Certificates, etc. is not a person that has already issued Share Certificates, etc. indicating the same features as those Share Certificates, etc. (limited to features with regard to the payment of the dividends of surplus, distribution of residual assets, cancellation of equity by using profits, or the cancellation of preferred equity investment under Article 15, paragraph (1) of the Act on Preferred Equity Investment (limited to the part that involves item (ii)) which are related to shares (including preferred equity investment as provided in the Act on Preferred Equity Investment and the preferred equity set forth in the Asset Securitization Act) or equity) which fall under any of the items of Article 24, paragraph (1) (including as applied mutatis mutandis pursuant to Article 27 of the Act);
2.what is specified by Cabinet Office Order as being a Security of the same type as those Share Certificates, etc. is not a Security for Professional Investors;
(b)Share Option Certificates, etc.: All of the following requirements are satisfied:
1.the issuer of the share certificates that would be acquired, subscribed for or converted through the exercise of the rights indicated on the Share Option Certificates, etc., and the share certificates, share option certificates, and Investment Equity Subscription Right Certificates satisfy the requirements set forth in (a), 1. and 2. respectively;
2.the issuer of the Share Option Certificates, etc. (excluding share option certificates and Investment Equity Subscription Right Certificates; hereinafter the same applies in (b)) is not a person that has already issued anything specified by Cabinet Office Order as being a Security of the same type as those Share Option Certificates, etc. and that falls under any of the items of Article 24, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act);
3.what is specified by Cabinet Office Order as being a Security of the same type as the relevant Share Option Certificates, etc. is not a Security for Professional Investors; and
4.a restriction has been placed on the Share Option Certificates, etc. (if those Share Option Certificates, etc. are Specified Corporate Bond Certificates with a Right to Subscribe for Preferred Equity and the Right to Subscribe for Preferred Equity may be transferred independently from the Specified Corporate Bond Certificates, the Specified Corporate Bond Certificate and the Certificate of a Right to Subscribe for Preferred Equity issued therewith), as per the formalities specified by Cabinet Office Order, prohibiting the person that has acquired or purchased the Share Option Certificates, etc. (if the person that has acquired or purchased the Share Option Certificates, etc. is a Qualified Institutional Investor and the Share Option Certificates, etc. fall under the cases specified in Article 1-4, that Qualified Institutional Investor is excluded) from transferring the Share Option Certificates, etc. unless they are transferred all at once to another single person, or those Share Option Certificates, etc. otherwise satisfy the requirements specified by Cabinet Office Order as being equivalent to this;
(c)Securities other than the Securities set forth in (a) and (b): a case meeting all of the following requirements:
1.the issuer of the Securities is not a person that has already issued anything specified by Cabinet Office Order as being a Security of the same type as those Securities and that falls under any of the items of Article 24, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act);
2.what is specified by Cabinet Office Order as being a Security of the same type as the relevant Securities is not a Security for Professional Investors; and
3.the Securities meet the requirements specified by Cabinet Office Order in accordance with (b);
(iv)if a solicitation for selling, etc. Foreign Securities with No Restriction on Transfer is being made, all of the following requirements are satisfied:
(a)it has been established that, if a Financial Instruments Business Operator, etc. (limited to a member of an Authorized Financial Instruments Firms Association) has made a solicitation for selling, etc. Foreign Securities with No Restriction on Transfer, the issues of the Foreign Securities with No Restriction on Transfer, the number calculated according to the provisions of Cabinet Office Order as the number of persons that acquired and currently hold those Foreign Securities with No Restriction on Transfer through the solicitation for selling, etc. (hereinafter referred to as "Number of Holders" in this item) and other particulars specified by Cabinet Office Order will be reported to the Authorized Financial Instruments Firms Association pursuant to the rules of the Authorized Financial Instruments Firms Association;
(b)it has been established that an Authorized Financial Instruments Firms Association receiving a report as prescribed in (a) will calculate and publicize the total Number of Holders with respect to each issue of Foreign Securities with No Restriction on Transfer pursuant to the rules of the Authorized Financial Instruments Firms Association;
(c)the total Number of Holders for each issue of Foreign Securities with No Restriction on Transfer referred to in (a) will not exceed one thousand.
(Cases in Which Securities Are Held by a Considerably Large Number of Persons through an Solicitation for selling)
Article 1-8-5The case specified by Cabinet Order that is provided for in Article 2, paragraph (4), item (iii) of the Act is a case in which the Securities connected with a solicitation for selling, etc. will come to be held by not less than 500 persons that have responded to that solicitation for selling, etc.
(Acts Excluded from Consideration as Financial Instruments Business)
Article 1-8-6(1)The acts specified by Cabinet Order that are provided for in Article 2, paragraph (8) of the Act are as follows:
(i)the acts set forth in the items of Article 2, paragraph (8) of the Act carried out by the following persons:
(a)the State;
(b)a local government;
(c)the Bank of Japan; and
(d)foreign governments and other persons equivalent to the persons set forth in (a) to (c) under the laws and regulations of a foreign state;
(ii)among the acts set forth in Article 2, paragraph (8), item (iv) of the Act, acts to conduct Over-the-Counter Derivatives Transactions (excluding Securities-Related Over-the-Counter Derivatives Transactions (meaning the transactions set forth in Article 28, paragraph (8), item (iv) of the Act) and cryptoassets-related over-the-counter derivatives transactions (meaning the cryptoassets-related over-the-counter derivatives transactions prescribed in Article 185-24, paragraph (1) of the Act; the same applies in Article 16-4, paragraph (1), item (i), (d)); hereinafter the same applies in this item) with any of the following persons or to provide intermediation, brokerage (excluding the Brokerage for Clearing of Securities, etc.; hereinafter the same applies in this item), or agency for Over-the-Counter Derivatives Transactions on behalf of such a person (excluding the acts that fall under those set forth in the preceding item and Specified Over-the-Counter Derivatives Transactions (meaning specified over-the-counter derivatives transactions as prescribed in Article 40-7, paragraph (1) of the Act; the same applies hereinafter) and intermediation, brokerage, or agency therefor (limited to those in the case in which the person engaged in the Specified Over-the-Counter Derivatives Transactions or intermediation, brokerage, or agency therefor conducts those transactions or services using an electronic data processing system that it uses for its business of Over-the-Counter Derivatives Transactions, etc. (meaning Over-the-Counter Derivatives Transactions, etc. as prescribed in Article 2, paragraph (8), item (iv) of the Act; the same applies hereinafter))):
(a)persons specified by Cabinet Office Order as persons found to have expert knowledge of and experience with Derivatives Transactions; or
(b)a stock company whose amount of stated capital is not less than the amount specified by Cabinet Office Order;
(iii)among the acts set forth in Article 2, paragraph (8), item (xv) of the Act, investment in a single corporation by allocating the entire sum of money or other property invested or contributed by persons holding a beneficial interest in commodities investment as prescribed in Article 2, paragraph (6) of the Act on Regulation of Commodity Investment (Act No. 66 of 1991) (if the beneficial interest in commodities investment means the rights set forth in Article 2, paragraph (6), item (ii) of that Act or the rights set forth in Article 2, paragraph (6), item (iii) of that Act (limited to those similar to the rights set forth in Article 2, paragraph (6), item (ii) of that Act), the trustee of a trust related to those rights) (hereinafter such investment is referred to as "Specified Investment" in this item and in the following paragraph) which satisfies all of the following requirements (excluding the acts falling under those set forth in item (i)):
(a)it has been provided for in either the Commodities Investment Contract (meaning a commodities investment contract as prescribed in Article 2, paragraph (5) of that Act) or the trust contract that is associated with the beneficial interest in commodities investment, or in the contract of sale for the beneficial interest in commodities investment that Specified Investment in the relevant corporation is to be undertaken and that the relevant corporation will invest the money or other property from that Specified Investment through Commodities Investment (meaning commodities investment as prescribed in Article 2, paragraph (1) of the Act on Regulation of Commodity Investment; the same applies hereinafter);
(b)the corporation is required to entrust the discretion in making those of its investment decisions as prescribed in Article 2, paragraph (2) of the Act on Regulation of Commodity Investment that involve Commodities Investment to the commodities investment advisor, etc. as prescribed in Article 33, paragraph (1) of that Act; and
(c)the investment is not the one in which the corporation invests money or other property from Specified Investment mainly in Securities or rights connected with Derivatives Transactions; and
(iv)beyond what is set forth in the preceding three items, acts specified by Cabinet Office Order in consideration of the nature of the acts and any other circumstances.
(2)If the corporation set forth in item (iii) of the preceding paragraph invests in another corporation by allocating the entire sum of money or other property from Specified Investment, or the entirety of anything other than that invested by Commodities Investment, with regard to the application of the provisions of (a) to (c) of the preceding item, that other corporation is deemed to be the relevant corporation.
(Scope of a Financial Institution)
Article 1-9The financial institutions specified by Cabinet Order that are provided for in the provisions of Article 2, paragraphs (8) and (11) and Article 27-2, paragraph (4) of the Act (including as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2) of the Act), Article 27-28, paragraph (3) of the Act (including as applied mutatis mutandis pursuant to Article 27-29, paragraph (2) of the Act), Article 28, paragraph (4), Article 31-4, paragraphs (3) and (4), Article 33, paragraph (1), Article 33-5, paragraph (2), Article 33-7, Article 33-8, paragraph (1), Article 50, paragraph (1), item (iv), Article 58, Article 60-14, paragraph (1), and Article 66 of the Act are as follows:
(i)the Shoko Chukin Bank Limited;
(ii)an Insurance Company (meaning an insurance company as prescribed in Article 2, paragraph (2) of the Insurance Business Act and a foreign insurance company, etc. as prescribed in paragraph (7) of that Article is included; the same applies hereinafter);
(iii)a mutual loan company;
(iv)a securities finance company; and
(v)among the persons mainly engaged in making call loans or in acting as an intermediary in the lending and borrowing of call money in the course of trade, those designated by the Commissioner of the Financial Services Agency.
(Securities Related to a Public Offering or Private Placement Constituting Financial Instruments Business)
Article 1-9-2The Securities specified by Cabinet Order that are provided for in Article 2, paragraph (8), item (vii), (g) of the Act are those as follows:
(i)those as follows (excluding those whose issuer is the trustee of the trust associated with the relevant Securities) which fall under the category of Securities aimed at Commodities Investment or invested through the acquisition (including production), transfer, or use of the goods set forth in Article 37, paragraph (1), item (ii), (a) to (e), or by causing those goods to be used:
(a)the Securities set forth in Article 2, paragraph (1), item (xiv) of the Act;
(b)among the Securities set forth in Article 2, paragraph (1), item (xvii) of the Act, those which have the nature of the Securities set forth in Article 2, paragraph (1), item (xiv) of the Act;
(c)the rights to be indicated on the Securities set forth in (a) or (b) which are deemed to be Securities pursuant to the provisions of Article 2, paragraph (2) of the Act; and
(d)the rights set forth in Article 2, paragraph (2), item (i) or (ii) of the Act which are deemed to be Securities pursuant to the provisions of Article 2, paragraph (2) of that Act;
(ii)the rights which are deemed to be Securities pursuant to the provisions of Article 2, paragraph (2) of the Act (excluding those set forth in paragraph (8), item (vii), (e) and (f) of that Article and in the preceding item, and limited to cases in which they are indicated on financial values which can be transferred by using an electronic data processing system (excluding cases specified by Cabinet Office Order in consideration of the need to protect investors)).
(Transactions Excluded from Consideration as Transaction Services Using an Electronic Data Processing System)
Article 1-9-3The transactions specified by Cabinet Order that are provided for in Article 2, paragraph (8), item (x) of the Act are the purchase and sale of Securities for Professional Investors (excluding those set forth in Article 4, paragraph (3), item (iv) of the Act (excluding those set forth in Article 2-12-4, paragraph (3), item (i) or (iii)), and those falling under a case in which disclosure has been made (meaning a case in which disclosure has been made as prescribed in Article 4, paragraph (7) of the Act)), or intermediation, brokerage, or agency therefor conducted by an electronic data processing system, based on a method for deciding the trading price as set forth in Article 2, paragraph (8), item (x), (a) to (e) of the Act or other method similar thereto, and in which a large number of persons are to participate simultaneously as one party in the transaction, or in which the transaction is conducted between a large number of persons.
(Criteria for the Method of Auction)
Article 1-10The criteria specified by Cabinet Order that are provided for in Article 2, paragraph (8), item (x), (a) of the Act are as follows:
(i)the ratio of the average amount of single-business-day total transaction volumes for purchase and sales (excluding those that fall under the category of Derivatives Transactions; hereinafter the same applies in this Article) of Listed Securities, etc. (meaning Securities listed on a Financial Instruments Exchange and Over-the-Counter Traded Securities; hereinafter the same applies in this Article) made in the last six months, as calculated on the last day of each month, based on a method for deciding the trading price as set forth in Article 2, paragraph (8), item (x), (a) of the Act, to the average amount of single-business-day total transaction volumes for purchase and sales of Listed Securities, etc. made in all Financial Instruments Exchange Markets and Over-the-Counter Securities Markets in the last six months is one percent; and
(ii)the ratio of the average amount of single-business-day total transaction volumes, by issue, for purchase and sales of Listed Securities, etc. made in the last six months, as calculated on the last day of each month, based on a method for deciding the trading price as set forth in Article 2, paragraph (8), item (x), (a) of the Act, to the average amount of single-business-day total transaction volumes for purchase and sales of those issues of Listed Securities, etc. made in all Financial Instruments Exchange Markets and Over-the-Counter Securities Markets in the last six months is ten percent.
(Scope of Investment Management Business)
Article 1-11The rights specified by Cabinet Order that are provided for in Article 2, paragraph (8), item (xiv) of the Act are the rights indicated on the Securities set forth in paragraph (1), item (x) of that Article.
(Acts Constituting Financial Instruments Business)
Article 1-12The acts specified by Cabinet Order that are provided for in Article 2, paragraph (8), item (xviii) of the Act are the following acts:
(i)purchasing, without the objective of reselling, the Securities (limited to the following Securities) associated with an act as set forth in Article 2, paragraph (8), item (vii) of the Act by the person that undertook that act:
(a)the Securities set forth in Article 2, paragraph (8), item (vii), (a) or (b) of the Act;
(b)rights to be indicated on the Securities set forth in (a) which are deemed to be Securities pursuant to the provisions of Article 2, paragraph (2) of the Act; and
(ii)accepting deposits of the rights set forth in the items of Article 2, paragraph (2) of the Act which are deemed to be Securities pursuant to the provisions of that paragraph (limited to cases in which those rights are indicated on financial values which can be transferred by using an electronic data processing system and excluding Electronically Recorded Transferable Rights (meaning the Electronically Recorded Transferable Rights prescribed in paragraph (3) of that Article; the same applies hereinafter)) from customers, in connection with an act set forth in Article 2, paragraph (8), items (i) to (x) of the Act undertaken thereby.
(Causes Similar to Causes Related to the Credit Status of a Corporation)
Article 1-13The cause specified by Cabinet Order that is provided for in Article 2, paragraph (21), item (v), (a) of the Act and paragraph (22), item (vi), (a) of that Article means a cause related to the credit status of a person that is not a corporation or any other cause that is specified by Cabinet Office Order as one that affects the basis of the management of the business for a person that conducts business.
(Causes That May Have a Serious Influence on the Business Activities of the Parties or Other Business Persons or Firms)
Article 1-14Causes specified by Cabinet Order that are provided for in Article 2, paragraph (21), item (v), (b) of the Act and paragraph (22), item (vi), (b) of that Article are as follows:
(i)wind storms, torrential rains, heavy snows, floods, storm surges, earthquakes, tsunamis, volcanic eruptions, and any other abnormal natural phenomena; and
(ii)war, revolution, insurrection, riot, civil disturbance, and any other cause specified by Cabinet Office Order as being equivalent thereto.
(Transactions Excluded from Consideration as Over-the-Counter Derivatives Transactions)
Article 1-15The transactions specified by Cabinet Order as those found not to compromise the public interest or the protection of investors as referred to in Article 2, paragraph (22) of the Act are as follows:
(i)the transactions set forth in Article 2, paragraph (22), item (iii) of the Act (excluding (b)) incidental to transactions of the receipt of deposits, etc. prescribed in Article 2, paragraph (2) of the Deposit Insurance Act (Act No, 34 of 1971) or savings, etc. prescribed in Article 2, paragraph (2) of the Agricultural and Fishery Cooperation Savings Insurance Act (Act No. 53 of 1973) (limited to the transactions involving the purchase and sale of currencies);
(ii)conclusion of contracts in connection with the insurance business prescribed in Article 2, paragraph (1) of the Insurance Business Act and the business set forth in the items of that paragraph;
(iii)conclusion of contracts in connection with a guarantee of obligations; or
(iv)if debt from a loan is no longer being repaid in whole or in part, conclusion of a contract to compensate the creditors thereof for the part of the amount which is no longer being repaid (excluding the contracts set forth in the preceding item).
(Actions Causing Settlement Based on the Difference in Values)
Article 1-16The action specified by Cabinet Order that is provided for in Article 2, paragraph (22), item (i) of the Act is an action whereby the parties to a purchase and sale wherein the parties promise to deliver and take delivery of a Financial Instrument (excluding those set forth in Article 2, paragraph (24), items (iii)-3 and (v) of the Act) and its value at a fixed time in the future in neither a Financial Instruments Market nor a Foreign Financial Instruments Market cancel the purchase and sale contract.
(Claims or Other Rights Based on a Deposit Contract, or Instruments or Certificates Indicating Such Claims or Rights)
Article 1-17The instruments or certificates specified by Cabinet Order that are provided for in Article 2, paragraph (24), item (ii) of the Act are the means of payment (excluding those falling under currencies) prescribed in Article 6, paragraph (1), item (vii) of the Foreign Exchange and Foreign Trade Act, the securities prescribed in Article 6, paragraph (1), item (xi) of that Act, and the claims prescribed in item (xiii) of that paragraph.
(Commodities)
Article 1-17-2The commodities specified by Cabinet Order that are provided for in Article 2, paragraph (24), item (iii)-3 of the Act are designated by the Commissioner of the Financial Services Agency through consultation with the minister having jurisdiction over a commodity market (meaning the minister having jurisdiction over a commodity market as prescribed in Article 194-6-2 of the Act), from among commodities prescribed in Article 2, paragraph (1) of the Commodity Futures Act (Act No. 239 of 1950) (excluding those for which measures for the stabilization of the prices of the respective commodities have been taken in accordance with the provisions of laws and regulations as necessary for achieving the supply and demand balance for the relevant commodities), in consideration of the appropriate volume of transactions expected in light of the conditions of transactions carried out by those engaged in the purchase and sale, intermediation, brokerage or agency therefor, production, processing or use of the relevant commodities and other conditions of economic activities relating to the commodities, as well as other circumstances concerning the price formation and the supply and demand of the commodities, and from the perspective that Market Derivatives Transactions involving the relevant commodities conducted in the Financial Instruments Exchange Market will lead to the formation of fair prices for the commodities, while reducing the risk of losses that investors might incur due to the price volatility of the commodities and bringing about other positive effects, and thus Market Derivatives Transactions involving the commodities conducted on the Financial Instruments Exchange Market will contribute to the sound development of the national economy.
(Scope of Financial Indicators)
Article 1-18The indicators or figures specified by Cabinet Order that are provided for in Article 2, paragraph (25), item (iii) of the Act are as follows:
(i)figures associated with the results of observations on terrestrial phenomenon, ground motion, geomagnetism, terrestrial electricity, or hydrology published by a Meteorological Agency or others;
(ii)figures associated with national accounts statistics prepared by the Cabinet in compliance with the standards specified by the United Nations, figures associated with the results of the designated statistical surveys prescribed in Article 3, paragraph (1) of the Statistics Act (Act No. 18 of 1947) or figures associated with the results of the notified statistical surveys prescribed in Article 14 of that Act or any other foreign statistical figures equivalent thereto;
(iii)foreign statistical figures equivalent to the preceding item;
(iv)figures that comprehensively indicate the level of the price of real property or prices of two or more real properties announced or provided periodically by an administrative organ (including local governments) under the provisions of laws and regulations or for the purpose of making them available for use to the general public, figures that comprehensively indicate the level of the price of real property or prices of two or more real properties announced or provided periodically by an organization engaged in business related to real property for the purpose of making them available for use to investors, or any other figures specified by Cabinet Office Order as being equivalent thereto.
(Transactions Excluded from Consideration as Subject Transactions of Financial Instruments Obligation Assumption Service)
Article 1-18-2Transactions specified by Cabinet Order as those which, in consideration of the status of the transactions, the impact exerted on Japan's capital market, and other circumstances, are found not to compromise the public interest or the protection of investors, as provided in Article 2, paragraph (28) of the Act, are transactions giving rise to obligations that a corporation established in compliance with laws and regulations of a foreign state that conducts the same type of services as Financial Instruments Obligation Assumption Services in a foreign state (limited to those that have been granted the same kind of license as prescribed in Article 156-2 of the Act or a permission or other administrative dispositions similar to such a license in the foreign state to engage in those Services under the provisions of laws and regulations of the foreign state and who have obtained the assurance prescribed in Article 189, paragraph (2), item (i) of the Act or anything else that is found to be equivalent to such assurance given by the authority responsible for the enforcement of those foreign laws and regulations; the same applies in item (ii) of the following Article) assumes, novates or in any other way bears on a regular basis, which transactions are designated by the Commissioner of the Financial Services Agency as giving rise to obligations that, if defaulted upon, would have a minor impact on Japan's capital market.
(Subject Transactions of Financial Instruments Obligation Assumption Service)
Article 1-19Transactions specified by Cabinet Order as those incidental or related to purchase and sales of Securities or Derivatives Transactions, as provided in Article 2, paragraph (28) of the Act, are as follows:
(i)the lending and borrowing of the money needed to settle a Margin Transaction, etc. (meaning a Margin Transaction (meaning the margin transaction defined in Article 156-24, paragraph (1) of the Act; the same applies hereinafter), a purchase and sale of Securities (excluding a purchase and sale of Securities that falls under the category of a Derivative Transaction; the same applies hereinafter), or a Market Derivatives Transaction made on a Financial Instruments Business Operator's own account or Brokerage for the Clearing of Securities, etc. (limited to those connected with a Margin Transaction, the purchase and sale of Securities or a Market Derivatives Transaction made on the Financial Instruments Business Operator's own account); the same applies in the following item) (limited to an instance of lending and borrowing in which the lending is done by a Securities Finance Company);
(ii)the lending and borrowing of Securities (if a person other than a Securities Finance Company lends the Securities necessary for the settlement of a Margin Transaction, etc. utilizing the clearing systems of a Financial Instruments Exchange Market or Over-the-Counter Securities Market, this is limited to lending in connection with a Margin Transaction, etc. undertaken without recourse to a Financial Instruments Exchange Market or an Over-the-Counter Securities Market, except any lending giving rise to an obligation that a corporation established in compliance with laws and regulations of a foreign state that conducts a service of the same type of services as Financial Instruments Obligation Assumption Services in a foreign state assumes, novates or in any other way bears on a regular basis, which lending is designated by the Commissioner of the Financial Services Agency as lending giving rise to obligations that, if defaulted upon, would have a minor impact on Japan's capital market);
(iii)the delivery and receipt of collateral in connection with the transactions set forth in the preceding two items;
(iv)the delivery and receipt of beneficiary certificates or Money, etc. (meaning money or Listed Securities, etc. (meaning Listed Securities, etc. as prescribed in Article 1-10, item (i), and limited to those of any of the issues subject to operation of the Securities Investment Trust or those that are among the trust property; hereinafter the same applies in this item, Article 15-3, item (iv), and Article 15-20, item (iv)); the same applies in Article 15-3, item (iv) and Article 15-20, item (iv)) with regard to the establishment (including additional establishment; the same applies in Article 15-3, item (iv) and Article 15-20, item (iv)) of a Securities Investment Trust (meaning a securities investment trust as prescribed in Article 2, paragraph (4) of the Act on Investment Trusts and Investment Corporations, and limited to one for which it is provided in the basic terms and conditions of the investment trust prescribed in Article 4, paragraph (1) of that Act that the investment trust will be operated by having the rate of fluctuations in the amount of net assets per unit for the Investment Trust Property correspond to the rate of fluctuations in the quotations on a Financial Instruments Market or any other indicator and that the beneficiary certificates of the Securities Investment Trust will be listed on a Financial Instruments Exchange or be registered in a Registry of Over-the-Counter Traded Securities; hereinafter the same applies in this item, Article 15-3, item (iv), and Article 15-20, item (iv)), the redemption of a part of the principal of a Securities Investment Trust, or the exchange between beneficiary certificates of a Securities Investment Trust and Listed Securities, etc.; and
(v)beyond what is set forth in the preceding items, delivery and receipt of Financial Instruments or money, made for the performance of the obligations arisen from the purchase and sale of Securities or Derivatives Transactions (excluding transactions prescribed in the preceding Article), or the transactions set forth in the preceding items.
(Commodity Exchanges Subject to Restrictions Found to Be of the Same Level as Restrictions on an Incorporated Financial Instruments Exchange)
Article 1-20The person specified by Cabinet Order that is provided for in Article 2, paragraph (38) of the Act is an Incorporated Commodity Exchange as defined in Article 2, paragraph (6) of the Commodity Futures Act (Act No. 239 of 1950).
(Commodity Exchanges Subject to Restrictions Found to Be of the Same Level as Restrictions on a Financial Instruments Exchange Holding Company)
Article 1-21The person specified by Cabinet Order that is provided for in Article 2, paragraph (39) of the Act is a Commodity Exchange Holding Company as defined in Article 2, paragraph (11) of the Commodity Futures Act.
(Acts That Constitute High-Speed Trading)
Article 1-22The acts specified by Cabinet Order that are provided for in Article 2, paragraph (41), item (iii) of the Act are the following:
(i)investing money or other assets (including instructions therefor) to conduct any of the acts set forth in Article 2, paragraph (41), item (i) of the Act (excluding the acts set forth in that item); and
(ii)conducting a transaction or act that will cause a person engaged in any of the acts set forth in Article 2, paragraph (41), item (i) of the Act to conduct any of the acts set forth in that item, by carrying out Over-the-Counter Derivatives Transactions with that person or by other means.
(Assets Deemed to be Money)
Article 1-23The provisions specified by Cabinet Order that are provided for in Article 2-2 of the Act are the provisions of Article 2, paragraph (21), items (i) to (v), Article 22, items (i) to (vi), Article 41-4, the main clause of Article 41-5, Article 42-5, the main clause of Article 42-6, Article 66-13, Article 185-22, paragraph (1), item (i) and Article 202, paragraph (1) of the Act.
Chapter II Disclosure of Corporate Affairs and Other Related Matters
(Scope of Reorganization)
Article 2The other acts specified by Cabinet Order that are provided for in Article 2-3, paragraph (1) of the Act are share transfers.
(Scope of a Reorganizing Company)
Article 2-2The company specified by Cabinet Order that is provided for in Article 2-3, paragraph (4), item (i) of the Act is a company that becomes a Company Disappearing in a Consolidation-type Merger (meaning a Company Disappearing in a Consolidation-type Merger as prescribed in Article 753, paragraph (1), item (i) of the Companies Act (Act No. 86 of 2005)), the Splitting Company in an Absorption-type Company Split (meaning a Splitting Company in an Absorption-type Company Split as defined in Article 758, item (i) of that Act, limited to those which have concluded an Absorption-type Company Split Agreement prescribed in Article 757 of that Act for that Absorption-type Company Split regarding the particulars specified in Article 758, item (viii), (b) or Article 760, item (vii), (b) of that Act and others specified by Cabinet Office Order as being equivalent thereto), the Splitting Company in an Incorporation-type Company Split (meaning a Splitting Company in an Incorporation-type Company Split as set forth in Article 763, paragraph (1), item (v) of that Act, limited to those which determine the particulars specified in item (xii), (b) of that paragraph or Article 765, paragraph (1), item (viii), (b) of that Act in the Incorporation-type Company Split Plan prescribed in Article 762 of that Act for that Incorporation-type Company Split and others specified by Cabinet Office Order as being equivalent thereto) or a Wholly Owned Subsidiary Company in a Share Transfer (meaning a Wholly Owned Subsidiary Company in a Share Transfer as prescribed in Article 773, paragraph (1), item (v) of that Act).
(Scope of Securities Issued by a Reorganizing Company)
Article 2-3The Securities specified by Cabinet Order that are provided for in the provisions of Article 2-3, paragraph (4), item (i) and Article 4, paragraph (1), item (ii), (a) of the Act are as follows:
(i)share option certificates;
(ii)corporate bond certificates with share options;
(iii)Certificates of a beneficial interest in a securities trust (meaning Securities as set forth in Article 2, paragraph (1), item (xiv) of the Act or the rights as set forth in paragraph (2), item (i) of that Article which are deemed to be Securities pursuant to the provisions of that paragraph (limited to the rights falling under the category of Electronically Recorded Transferable Rights) for which Securities as set forth in the items of Article 2, paragraph (1) of the Act constitute trust property and for which an indication that the substance of the rights associated with the Securities that constitute trust property (hereinafter referred to as "Entrusted Securities") is included as part of the substance of the beneficial interest in that trust and other particulars specified by Cabinet Office Order have been provided in the trust deed for that trust; the same applies hereinafter), if the Entrusted Securities are share certificates or the Securities set forth in the preceding two items; or
(iv)Securities as set forth in Article 2, paragraph (1), item (xx) of the Act that indicate rights associated with share certificates or with Securities set forth in item (i) or item (ii).
(Cases in Which There Are a Large Number of Reorganizing Company's Shareholders in the Procedures Related to the Issuance of Securities During a Reorganization)
Article 2-4The cases specified by Cabinet Order that are provided for in Article 2-3, paragraph (4), item (i) of the Act are cases in which the Reorganizing Company's Shareholders, etc. (meaning Reorganizing Company's Shareholders, etc. as prescribed in Article 2-3, paragraph (4), item (i) of the Act; the same applies in the following Article to Article 2-7) are not less than 50 persons.
(Cases in Which Procedures Related to the Issuance of Securities During a Reorganization Constitute Solicitation to a Small Number of Investors)
Article 2-4-2The cases specified by Cabinet Order that are provided for in Article 2-3, paragraph (4), item (ii), (b) of the Act are cases that satisfy all of the following requirements:
(i)the Reorganizing Company's Shareholders, etc. that are involved in the Procedures Related to the Issuance of Securities During a Reorganization do not consist exclusively of Qualified Institutional Investors, and it is not a case in which the number of Reorganizing Company's Shareholders, etc. is 50 persons or more;
(ii)the requirements specified in the relevant of (a) to (c) below are satisfied for the category of Securities set forth in the:
(a)Share Certificates, etc.: The requirements set forth in Article 1-7, item (ii), (a) are satisfied;
(b)Share Option Certificates, etc.: The requirements set forth in Article 1-7, item (ii), (b) are satisfied.
(Cases in Which There Are a Considerably Large Number of Reorganizing Company's Shareholders in Procedures Related to the Issuance of Securities During a Reorganization)
Article 2-5The cases specified by Cabinet Order that are provided for in Article 2-3, paragraph (4), item (iii) of the Act are cases in which the Reorganizing Company's Shareholders, etc. are 500 or more persons.
(Cases in Which There Are a Large Number of Reorganizing Company's Shareholders in the Procedures Related to the Issuance of Securities During a Reorganization)
Article 2-6The cases specified by Cabinet Order that are provided for in Article 2-3, paragraph (5), item (i) of the Act are cases in which the Reorganizing Company's Shareholders, etc. are not less than 50 persons.
(Cases in Which Procedures Related to the Delivery of Securities During a Reorganization Constitute Solicitation to a Small Number of Investors)
Article 2-6-2The cases specified by Cabinet Order that are provided for in Article 2-3, paragraph (5), item (ii), (b) of the Act are cases that satisfy all of the following requirements:
(i)the Reorganizing Company's Shareholders, etc. that are involved in the Procedures Related to the Delivery of Securities During a Reorganization do not consist exclusively of Qualified Institutional Investors, and it is not a case in which the number of Reorganizing Company's Shareholders, etc. is 50 persons or more;
(ii)the requirements specified in the relevant of (a) to (c) below are satisfied for the category of Securities set forth in the item:
(a)Share Certificates, etc.: The requirements set forth in Article 1-8-4, item (iii), (a) are satisfied;
(b)Share Option Certificates, etc.: The requirements set forth in Article 1-8-4, item (iii), (b) are satisfied;
(c)Securities other than the Securities set forth in (a) and (b): The requirements set forth in Article 1-8-4, item (iii), (c) are satisfied.
(Cases in Which There Are a Considerably Large Number of Reorganizing Company's Shareholders in the Procedures Related to the Issuance of Securities During a Reorganization)
Article 2-7The cases specified by Cabinet Order that are provided for in Article 2-3, paragraph (5), item (iii) of the Act are cases in which the Reorganizing Company's Shareholders, etc. are not less than 500 persons.
(Securities to Which the Provisions of Chapter II of the Act Apply)
Article 2-8The Securities specified by Cabinet Order that are provided for in Article 3, item (ii) of the Act are the social medical care corporation bonds set forth in the Medical Care Act (Act No. 205 of 1948).
(Scope of business subject to investment Associated with Rights in Securities Investment Business to Which the Provisions of Chapter II of the Act Apply)
Article 2-9(1)The rights specified by Cabinet Order that are provided for in Article 3, item (iii), (a), 1. of the Act are the rights connected with an business subject to investment (meaning an business subject to investment as set forth in Article 2, paragraph (2), item (v) of the Act and excluding the following businesses) that invests in Securities by allocating an amount exceeding 50 percent of the total amount of money or other property that persons holding rights as set forth in Article 2, paragraph (2), item (v) of the Act have contributed or invested:
(i)investment in a single corporation (hereinafter referred to as a "Specified Corporation" in this item) by allocating the entire sum of money or other property invested or contributed by persons holding a beneficial interest in commodities investment as prescribed in Article 2, paragraph (6) of the Act on Regulation of Commodity Investment (limited to a beneficial interest in commodities investment connected with rights set forth in Article 2, paragraph (6), item (i) of that Act) (hereinafter such investment is referred to as the "Specified Investment" in this Article), which satisfies all of the following requirements:
(a)the Specified Corporation will not invest in Securities by allocating an amount exceeding 50 percent of the total amount of money or other property from Specified Investment; and
(b)the Specified Corporation is prohibited from receiving investments from two or more persons by laws and regulations, the articles of incorporation of the Specified Corporation, articles of endowment, or any other thing equivalent thereto;
(ii)an investment wherein the goods appropriated are limited to those specified by Cabinet Office Order among the goods set forth in Article 1-3, item (iv) (hereinafter such investment is referred to as the "Specified Investment in Kind" in this item), which satisfies all of the following requirements:
(a)the person that is to receive the Specified Investment in Kind is prohibited from receiving investments from two or more persons by laws and regulations, the articles of incorporation of the person that is to receive the Specified Investment in Kind, articles of endowment, any other thing equivalent thereto, or the contract for Specified Investment in Kind; and
(b)the contract for Specified Investment in Kind provides that the person that is to receive the Specified Investment in Kind will not acquire Securities using the goods associated with the Specified Investment in Kind.
(2)If the Specified Corporation prescribed in item (i) of the preceding paragraph makes an investment in another corporation by allocating the entire sum of money or other property from Specified Investment, or anything other than this, that is invested through Commodities Investment, with regard to the application of the provisions of (a) and (b) of that item, that other corporation is deemed to be the Specified Corporation.
(Scope of Rights Deemed to Be Securities to Which the Provisions of Chapter II of the Act Apply)
Article 2-10(1)The rights specified by Cabinet Order that are provided for in Article 3, item (iii), (a), 2. of the Act are the following rights:
(i)among the rights set forth in Article 2, paragraph (2), item (i) of the Act, a beneficial interest in a trust in which investment is undertaken through the allocation of an amount exceeding 50 percent of the total value of the assets constituting trust property to investment in Securities (excluding the following beneficial interest):
(a)the beneficial interest in a trust set forth in Article 130-2, paragraph (2) of the Employees' Pension Insurance Act (Act No. 115 of 1954) prior to the amendment by Article 1 of the Act for Partial Amendment to the Employees' Pension Insurance Act to Ensure the Soundness and Reliability of the Public Pension System (Act No. 63 of 2013; hereinafter referred to as the "2013 Employees' Pension Amendment Act" in (a)) (the Employees' Pension Insurance Act prior to the amendment is referred to as the "Former Employees' Pension Insurance Act" in (a)) as applied mutatis mutandis pursuant to Article 130-2, paragraphs (1) and (2), Article 136-3, paragraph (1), item (i), item (iv), (d) of that paragraph and item (v), (f) of that paragraph, and paragraph (2) of that Article of the Former Employees' Pension Insurance Act which remain in force pursuant to the provisions of Article 5, paragraph (1) of the Supplementary Provisions of the 2013 Employees' Pension Amendment Act; and set forth in Article 159-2, paragraphs (1) and (2) of the Former Employees' Pension Insurance Act, Article 136-3, paragraph (1), item (i), item (iv), (d) of that paragraph and item (v), (f) of that paragraph of the Former Employees' Pension Insurance Act as applied mutatis mutandis pursuant to Article 164, paragraph (3) of that Act, and Article 130-2, paragraph (2) of the Former Employees' Pension Insurance Act as applied mutatis mutandis pursuant to Article 136-3, paragraph (2) of that Act as applied mutatis mutandis pursuant to Article 164, paragraph (3) of that Act which remain in force pursuant to the provisions of Article 38, paragraph (1) of the Supplementary Provisions of the 2013 Employees' Pension Amendment Act;
(b)the beneficial interest in a trust set forth in Article 128, paragraph (3) and Article 137-15, paragraph (4) of the National Pension Act (Act No. 141 of 1959);
(c)the beneficial interest in a trust set forth in Article 30, paragraph (1), item (i), item (iv), (d) of that paragraph and item (v), (f) of that paragraph, and paragraph (2) of that Article of the Order for Enforcement of the National Pension Act (Cabinet Order No. 304 of 1990) (including as applied mutatis mutandis pursuant to Article 51, paragraph (1) of that Order);
(d)the beneficial interest in a trust connected with a qualified retirement pension contract (limited to a trust contract) as prescribed in Article 20, paragraph (3) of the Supplementary Provisions of the Corporation Tax Act (Act No. 34 of 1965);
(e)the beneficial interest in a trust connected with asset management contracts as prescribed in Article 65, paragraph (3) of the Defined-Benefit Corporate Pension Act (Act No. 50 of 2001) (limited to a trust contract set forth in Article 65, paragraph (1), item (i) of that Act), a trust contract set forth in Article 65, paragraph (1), item (i) of that Act concluded under Article 66, paragraph (1) of that Act (including as applied mutatis mutandis pursuant to Article 91-25 of that Act) and a trust contract as prescribed in Article 66, paragraph (2) of that Act (including as applied mutatis mutandis pursuant to Article 91-24 of that Act);
(f)the beneficial interest in a trust connected with an asset management contract prescribed in Article 8, paragraph (2) of the Defined Contribution Pension Act (Act No. 88 of 2001) (limited to the trust contract set forth in paragraph (1), item (i) of that Article);
(g)the beneficial interest in a trust prescribed in Article 21, paragraph (1), item (iii) of the Act on the Government Pension Investment Fund (Act No. 105 of 2004);
(h)the beneficial interest in a trust connected with protective trust contracts concluded pursuant to Article 51, paragraph (1) of the Act on Transfer of Corporate Bonds (Act No. 75 of 2001);
(i)the beneficial interest in a trust set forth in Article 43-2, paragraph (2) of the Act and other beneficial interest in a trust specified by Cabinet Office Order as being similar thereto;
(j)the beneficial interest in a trust prescribed in Article 6-2, paragraph (1) and Article 6-3, paragraph (2) of the Workers' Property Accumulation Promotion Act (Act No, 92 of 1971);
(k)the beneficial interest in a trust which falls under the category of a beneficial interest in commodities investment as prescribed in Article 2, paragraph (6) of the Act on Regulation of Commodity Investment, if rights set forth in Article 2, paragraph (2), item (v) of the Act (limited to cases in which the business subject to investment prescribed in that item that is associated with those rights is conducted through Commodities Investment or investment in a single corporation (hereinafter referred to as a "Specified Corporation" in this item) (hereinafter such investment is referred to as "Specified Investment" in this item and paragraph (3)) which satisfies all of the following requirements) or rights set forth in Article 2, paragraph (2), item (vi) of the Act equivalent thereto are acquired by allocating all of the trust property in that trust:
1.the business is not one wherein the Specified Corporation invests in Securities by allocating an amount exceeding 50 percent of the total amount of money or other property from Specified Investment; and
2.the Specified Corporation is prohibited from receiving investments from two or more persons by laws and regulations, the articles of incorporation of the Specified Corporation, articles of endowment, or any other thing equivalent thereto;
(ii)among the rights set forth in Article 2, paragraph (2), item (ii) of the Act, those which have the nature of the rights set forth in the preceding item;
(iii)among the rights set forth in Article 2, paragraph (2), item (iii) of the Act, membership rights in a general partnership company, limited partnership company or limited liability company that carries out investment in Securities by allocating an amount exceeding 50 percent of the total investment;
(iv)among the rights set forth in Article 2, paragraph (2), item (iv) of the Act, those which have the nature of the rights set forth in the preceding item; and
(v)among the rights set forth in Article 2, paragraph (2), item (vi) of the Act, those which have the nature of the rights set forth in paragraph (1) of the preceding Article.
(2)The rights specified by Cabinet Order that are provided for in Article 3, item (iii), (a), 3. of the Act are the claims set forth in Article 1-3-4.
(3)If the Specified Corporation set forth in paragraph (1), item (i), (k) invests in another corporation by allocating the entire sum of money or other property from Specified Investment, or by allocating anything other than that which it invests through Commodities Investment, with regard to the application of the provisions of item (i), (k), 1. and 2., the other corporation is deemed to be the Specified Corporation.
(Securities Free from the Application of the Provisions of Chapter II of the Act)
Article 2-11The Securities specified by Cabinet Order that are provided for in Article 3, item (v) of the Act are, among the Securities set forth in Article 2, paragraph (1), item (xvii) of the Act, the bonds issued by an institution established by a treaty to which Japan is a member state, whose public offering or secondary distribution within Japan requires the consent of the Japanese government pursuant to the treaty.
(Public Offering or Secondary Distribution of Securities Not Requiring a Public Offering or Secondary Distribution Notification)
Article 2-12The cases specified by Cabinet Order that are provided for in Article 4, paragraph (1), item (i) of the Act are cases falling under any of the following:
(i)cases in which the company (including a foreign company; hereinafter the same applies except in Article 14-17, item (x), Article 27-4, item (vi) and Article 33-2, item (vi)) that is the issuer of the share certificates (limited to those listed on a Financial Instruments Exchange or those falling under Over-the-Counter Traded Securities; hereinafter the same applies in this item) or, among the Securities set forth in Article 2, paragraph (1), item (xvii) of the Act, the Securities which have the nature of share certificates (hereinafter collectively referred to as the "Share Certificates, etc." in this item) makes a solicitation for acquisition or a Solicitation for selling, etc. the Share Certificates, etc. with a director, accounting advisor, company auditor, executive officer, or employee (hereinafter referred to as a "director, etc." in this Article) of the relevant company or of another company specified by Cabinet Office Order as a company whose management is controlled by the relevant company as the other party (limited to Share Certificates, etc. with a restriction prohibiting the transfer thereof for a period not shorter than three months (or for foreign companies, six months) after the lapse of the business year that includes the day on which the director, etc. receives the delivery); and
(ii)cases in which the company that is the issuer of the share option certificates (limited to those for which the particulars set forth in Article 236, paragraph (1), item (vi) of the Companies Act are provided) or, among the Securities set forth in Article 2, paragraph (1), item (xvii) of the Act, the Securities which have the nature of share option certificates with the conditions specified by Cabinet Office Order (hereinafter collectively referred to as the "Share Option Certificates, etc." in this item) makes a solicitation for acquisition or a Solicitation for selling, etc. the Share Option Certificates, etc. with a director, etc. of the relevant company or of another company specified by Cabinet Office Order as a company whose management is controlled by the relevant company as the other party.
(Securities Equivalent to Securities Already Issued in a Foreign State)
Article 2-12-2Securities specified by Cabinet Order that are provided for in Article 4, paragraph (1), item (iv) of the Act are Securities that have already been issued in Japan but for which Solicitation for Newly Issued Securities, etc. (meaning Solicitation for Newly Issued Securities, etc. as defined in paragraph (2) of that Article; the same applies hereinafter) was not undertaken in Japan at the time of their issuance.
(Secondary Distribution of Securities Not Requiring a Secondary Distribution of Securities Notification)
Article 2-12-3The requirements specified by Cabinet Order that are provided for in Article 4, paragraph (1), item (iv) of the Act are as specified in the relevant of the following items for the category of Securities set forth in that item:
(i)Securities specified in Article 2, paragraph (1), item (xvii) of the Act which have the nature of Securities specified in item (i) of that paragraph (hereinafter referred to as "Foreign National Government Bonds" in this item): All of the following requirements are satisfied:
(a)persons can easily obtain information on the trading price of the Foreign National Government Bonds in Japan by using the Internet or by any other means;
(b)purchase and sales of the Foreign National Government Bonds or of other Foreign National Government Bonds that their Issuer issues are ongoing in a foreign state;
(c)financial information on the Issuer of the Foreign National Government Bonds and other information on the Issuer (limited to information published in Japanese or English) has been made public by the Issuer or any other person equivalent thereto, and persons can easily obtain that information in Japan by using the Internet or by any other means (excluding cases in which the Issuer has submitted an Annual Securities Report under the provisions of Article 24, paragraph (1) of the Act applied mutatis mutandis pursuant to Article 27 of the Act);
(ii)Securities specified in Article 2, paragraph (1), item (xvii) of the Act which have the nature of Securities specified in item (ii) of that paragraph (hereinafter referred to as "Foreign Municipal Bonds" in this item): All of the following requirements are satisfied:
(a)persons can easily obtain information on the trading price of those Foreign Municipal Bonds in Japan by using the Internet or by any other means;
(b)purchase and sales of the Foreign Municipal Bonds or of other Foreign Municipal Bonds that their Issuer issues are ongoing in a foreign state;
(c)financial information on the Issuer of the Foreign Municipal Bonds and other information on the Issuer (limited to information published in Japanese or English) has been made public by the Issuer or any other person equivalent thereto, and persons can easily obtain that information in Japan by using the Internet or by any other means (excluding cases in which the Issuer has submitted an Annual Securities Report under the provisions of Article 24, paragraph (1) of the Act applied mutatis mutandis pursuant to Article 27 of the Act);
(iii)Securities specified in Article 2, paragraph (1), item (xvii) of the Act which have the nature of Securities specified in item (iii) of that paragraph (hereinafter referred to as "Foreign Public Corporate Bonds" in this item): All of the following requirements are satisfied:
(a)persons can easily obtain information on the trading price of the Foreign Public Corporate Bonds in Japan by using the Internet or by any other means;
(b)purchase and sales of the Foreign Public Corporate Bonds or of other Foreign Public Corporate Bonds that their Issuer issues are ongoing in a foreign state;
(c)accounting information about the Issuer of the Foreign Public Corporate Bonds and other information on the Issuer (limited to information published in Japanese or English, and in the case of accounting information about the Issuer, limited to information prepared according to criteria deemed appropriate by the Commissioner of the Financial Services Agency for the public interest or protection of investors; the same applies in (d) of the following item and item (vi), (c)) is made public by the Issuer or any other person equivalent thereto, and persons can easily obtain that information in Japan by using the Internet or by any other means (excluding cases in which the Issuer has submitted an Annual Securities Report under the provisions of Article 24, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act));
(iv)corporate bond certificates (if certain predetermined conditions are met, limited to those converted into share certificates issued by persons other than the Issuer of the corporate bond certificates; hereinafter the same applies in this item) and Securities specified in Article 2, paragraph (1), item (xvii) of the Act which have the nature of such corporate bond certificates (hereinafter referred to as "Convertible Corporate Bond Certificates Issued Overseas" in this item and item (vi)): All of the following requirements are satisfied:
(a)persons can easily obtain information on the trading price of the Convertible Corporate Bond Certificates Issued Overseas in Japan by using the Internet or by any other means;
(b)the Convertible Corporate Bond Certificates Issued Overseas are listed on a Financial Instruments Exchange in a foreign state (meaning an exchange similar to a Financial Instruments Exchange, which is established under laws and regulations of a foreign state; the same applies in Article 12, item (vii) and Article 14-3-7, item (ii)) which is designated by the Commissioner of the Financial Services Agency in consideration of the Securities listed thereon, the state of disclosure of information on the Issuer, the trading volume and other circumstances (hereinafter referred to as "Designated Foreign Financial Instruments Exchange"), or purchase and sales of the Convertible Corporate Bond Certificates Issued Overseas are ongoing in a foreign state;
(c)share certificates that it has been established will be converted if certain predetermined conditions are met or Securities specified in Article 2, paragraph (1), item (xvii) of the Act which have the nature of share certificates (hereinafter referred to as "Share Certificates" in this Article) are listed on a Financial Instruments Exchange or a Designated Foreign Financial Instruments Exchange;
(d)under the rules provided by a Designated Foreign Financial Instruments Exchange if the Convertible Corporate Bond Certificates Issued Overseas or Share Certificates of the Issuer of the Convertible Corporate Bond Certificates Issued Overseas are listed on the Designated Foreign Financial Instruments Exchange, or under the laws and regulations of a foreign state in which purchase and sales of the Convertible Corporate Bond Certificates Issued Overseas are ongoing (including rules of international organizations similar thereto; hereinafter the same applies in this Article) in other cases, accounting information about the Issuer of the Convertible Corporate Bond Certificates Issued Overseas and other information about the Issuer is made public by the Issuer, and persons can easily obtain that information in Japan by using the Internet or by any other means (excluding cases in which the Issuer has submitted an Annual Securities Report under the provisions of Article 24, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act));
(v)Securities specified in Article 2, paragraph (1), items (v) to (vii) of the Act (referred to as "Bond Certificates, etc." in the following item) that constitute Share Option Certificates, etc. (hereinafter referred to as "Bond Certificates with Share Options" in this item) and Securities specified in item (xvii) of that paragraph which have the nature of Bond Certificates with Share Options (referred to as "Bond Certificates with Share Options Issued Overseas" in this item and the following item): All of the following requirements are satisfied:
(a)persons can easily obtain information on the trading price of those Bond Certificates with Share Options Issued Overseas in Japan by using the Internet or by any other means;
(b)the Bond Certificates with Share Options Issued Overseas are listed on a Designated Foreign Financial Instruments Exchange, or purchase and sales of the Bond Certificates with Share Options Issued Overseas are ongoing in a foreign state;
(c)the Share Certificates that would be acquired, subscribed for or converted through the exercise of the rights indicated on the Bond Certificates with Share Options Issued Overseas are listed on a Designated Foreign Financial Instruments Exchange;
(d)pursuant to the rules established by the Designated Foreign Financial Instruments Exchange on which the Bond Certificates with Share Options Issued Overseas or Share Certificates prescribed in (c) are listed, accounting information for the Issuer of the Bond Certificates with Share Options Issued Overseas and other information on the Issuer (limited to information published in Japanese or English) has been made public by the Issuer, and persons can easily obtain that information in Japan by using the Internet or by any other means (excluding cases in which the Issuer has submitted an Annual Securities Report under the provisions of Article 24, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act));
(vi)Bond Certificates, etc. (excluding Convertible Corporate Bond Certificates Issued Overseas and Bond Certificates with Share Options Issued Overseas; hereinafter the same applies in this item) and Securities specified in Article 2, paragraph (1), item (xvii) of the Act which have the nature of Bond Certificates, etc. (hereinafter referred to as "Bond Certificates Issued Overseas" in this item): All of the following requirements are satisfied:
(a)persons can easily obtain information on the trading price of those Bond Certificates Issued Overseas in Japan by using the Internet or by any other means;
(b)the Bond Certificates Issued Overseas are listed on a Designated Foreign Financial Instruments Exchange, or purchase and sales of the Bond Certificates Issued Overseas are ongoing in a foreign state (excluding cases in which a company that holds, in its own name or in another person's name, the majority of the Voting Rights Held by All the Shareholders, etc. (meaning Voting Rights Held by All the Shareholders, etc. as defined in Article 29-4, paragraph (2) of the Act; the same applies hereinafter) of the Issuer of the Bond Certificates Issued Overseas (limited to the Issuer of Share Certificates that are listed on a Financial Instruments Exchange or a Designated Foreign Financial Instruments Exchange; hereinafter referred to as "Parent Company" in this item) guarantees the redemption of the principal and the payment of interest of the Bond Certificates Issued Overseas);
(c)pursuant to the rules established by the Designated Foreign Financial Instruments Exchange on which the Bond Certificates Issued Overseas are listed, if they are listed on a Designated Foreign Financial Instruments Exchange; or pursuant to the laws and regulations of the foreign state in which purchase and sales of the Bond Certificates Issued Overseas are ongoing, in other cases; accounting information for the Issuer of the Bond Certificates Issued Overseas and other information on the Issuer (in the case provided in the parentheses in (b), if the Parent Company has submitted an Annual Securities Report pursuant to the provisions of Article 24, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act), or if accounting information on the Parent Company or other information about the Parent Company (limited to information published in Japanese or English) has been made public by the Parent Company pursuant to the rules established by the Designated Foreign Financial Instruments Exchange on which the Share Certificates of the Parent Company are listed, and persons can easily obtain that information in Japan by using the Internet or by any other means, an indication that a guarantee has been received for the Bond Certificates Issued Overseas, the name of the Parent Company providing the guarantee, a description of the business of the Issuer, and other information specified by Cabinet Office Order) has been made public by the Issuer, and that information can easily be obtained in Japan using the Internet or by any other means (excluding cases in which the Issuer has submitted an Annual Securities Report under the provisions of that paragraph (including as applied mutatis mutandis pursuant to Article 27 of the Act));
(vii)Share Certificates and Securities specified in Article 2, paragraph (1), item (xvii) of the Act which have the nature of Share Certificates (hereinafter referred to as "Share Certificates Issued Overseas" in this item): All of the following requirements are satisfied:
(a)persons can easily obtain information on the trading price of those Share Certificates Issued Overseas in Japan by using the Internet or by any other means;
(b)the Share Certificates Issued Overseas are listed on a Designated Foreign Financial Instruments Exchange;
(c)pursuant to the rules established by the Designated Foreign Financial Instruments Exchange on which the Share Certificates Issued Overseas are listed, accounting information for the Issuer of the Share Certificates Issued Overseas and other information on the Issuer (limited to information published in Japanese or English) has been made public by the Issuer, and persons can easily obtain that information in Japan by using the Internet or by any other means (excluding cases in which the Issuer has submitted an Annual Securities Report under the provisions of Article 24, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act));
(viii)beneficiary certificates of foreign investment trusts specified in Article 2, paragraph (1), item (x) of the Act which are similar to the beneficiary certificates of investment trusts specified in Article 12, item (ii) of the Order for Enforcement of the Act on Investment Trusts and Investment Corporations (Cabinet Order No. 480 of 2000) (hereinafter referred to as "Foreign-Issued Beneficiary Certificates" in this item) and foreign investment securities specified in item (xi) of that paragraph (excluding foreign investment securities as prescribed in the Act on Investment Trusts and Investment Corporations which are similar to Investment Equity Subscription Right Certificates or investment corporation bond certificates; hereinafter referred to as "Foreign-Issued Investment Securities" in this item): All of the following requirements are satisfied:
(a)persons can easily obtain information on the trading price of the Foreign-Issued Beneficiary Certificates or Foreign-Issued Investment Securities (hereinafter referred to as "the Foreign-Issued Beneficiary Certificates or Investment Securities" in this item) in Japan by using the Internet or by any other means;
(b)the Foreign-Issued Beneficiary Certificates or Investment Securities are listed on a Designated Foreign Financial Instruments Exchange;
(c)pursuant to the rules established by the Designated Foreign Financial Instruments Exchange on which the Foreign-Issued Beneficiary Certificates or Investment Securities are listed, information on the Foreign-Issued Beneficiary Certificates or Investment Securities (limited to information published in Japanese or English) has been made public by the Issuer of the Foreign-Issued Beneficiary Certificates or Investment Securities, and persons can easily obtain that information in Japan by using the Internet or by any other means (excluding cases in which the Issuer has submitted an Annual Securities Report under the provisions of Article 24, paragraph (1) of the Act applied mutatis mutandis pursuant to paragraph (5) of that Article (including as applied mutatis mutandis pursuant to Article 27 of the Act));
(ix)Securities specified in Article 2, paragraph (1), item (xix) of the Act (hereinafter referred to as "Securities Indicating Rights" in this item): All of the following requirements are satisfied:
(a)the Securities Indicating Rights indicate the rights associated with transactions specified in Article 2, paragraph (22), item (iii) or (iv) involving Share Certificates, etc. (meaning Share Certificates, Securities specified in Article 2, paragraph (1), item (xi) of the Act (excluding investment corporation bond certificates and foreign investment securities similar to investment corporation bond certificates prescribed in the Act on Investment Trusts and Investment Corporations, as well as Investment Equity Subscription Right Certificates, etc.; hereinafter referred to as "Investment Securities" in (a)) and Securities specified in item (xx) of that paragraph which indicate rights associated with Share Certificates or Investment Securities; hereinafter the same applies in (a)) or corporate bond certificates, etc. (meaning corporate bond certificates and Securities specified in item (xvii) of that paragraph which have the nature of corporate bond certificates; hereinafter the same applies in (a)) which satisfy all of the following requirements:
1.the Share Certificates, etc. or corporate bond certificates, etc. are listed on a Financial Instruments Exchange or a Designated Foreign Financial Instruments Exchange, or purchase and sales of the corporate bond certificates, etc. are ongoing in a foreign state;
2.pursuant to the rules established by the Designated Foreign Financial Instruments Exchange on which the Share Certificates, etc. or the corporate bond certificates, etc. are listed, or pursuant to the laws and regulations of the foreign state in which purchase and sales of the corporate bond certificates, etc. are ongoing, accounting information for the Issuer of the Share Certificates, etc. or the corporate bond certificates, etc. and other information on the Issuer (limited to information published in Japanese or English) has been made public by the Issuer, and persons can easily obtain that information in Japan by using the Internet or by any other means (excluding cases in which the Issuer has submitted an Annual Securities Report under the provisions of Article 24, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act));
(b)it is agreed upon in advance that by the exercise of rights indicated on the Securities Indicating Rights, the transaction connected with those rights will be executed at a fixed time in the future, and that the parties will settle by delivering and taking delivery of the difference in values associated with the transaction;
(c)persons can easily obtain information on the trading price of those Securities Indicating Rights in Japan by using the Internet or by any other means;
(x)Securities specified in Article 2, paragraph (1), item (xx) of the Act: All of the following requirements are satisfied:
(a)the Securities indicate the rights associated with the Share Certificates;
(b)persons can easily obtain information on the trading price of the Securities in Japan by using the Internet or by any other means;
(c)the Securities are listed on a Designated Foreign Financial Instruments Exchange;
(d)pursuant to the rules established by the Designated Foreign Financial Instruments Exchange on which the Securities are listed, accounting information for the Issuer of the Securities and other information on the Issuer (limited to information published in Japanese or English) has been made public by the Issuer, and persons can easily obtain that information in Japan by using the Internet or by any other means (excluding cases in which the Issuer has submitted an Annual Securities Report under the provisions of Article 24, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act)).
(Securities Excluded from Consideration as Securities for Professional Investors)
Article 2-12-4(1)The Securities specified by Cabinet Order as those which it is found are unlikely to be owned by a large number of Professional Investors, as prescribed in Article 4, paragraph (3) of the Act, are the Securities approved by the Commissioner of the Financial Services Agency pursuant to the provisions of Cabinet Office Order as those for which it would not compromise the public interest or protection of investors even if the Securities (excluding Securities specified by Cabinet Office Order as those which have been found to be improper regarding the protection of investors, taking into consideration the class and liquidation and other particulars of the Securities) do not fall under the category of Securities for Professional Investors, if the holders of those Securities as of the last day of the immediately preceding business year (if the Securities fall under the category of Regulated Securities, the Specified Period (meaning a Specified Period as prescribed in Article 24, paragraph (1) of the Act as applied mutatis mutandis pursuant to Article 24, paragraph (5) of the Act following the deemed replacement of terms; the same applies in Article 4-2, paragraph (1)) relating to those Securities; hereinafter the same applies in this paragraph, Article 3-4 and Article 4-2-2) of or every last day of the business years commenced within two years before the day of the commencement of the immediately preceding business year of the issuer of those Securities are less than 300 persons (limited to if three years have elapsed after the close of the business year wherein the Securities came to fall under the category of Securities for Professional Investors (if there are two or more business years, the latest business year)).
(2)The solicitation with a view to delivering existing securities specified by Cabinet Order that is provided for in Article 4, paragraph (3) of the Act (meaning solicitation with a view to delivering existing securities as defined in paragraph (2) of that Article; hereinafter the same applies in this paragraph and Article 3-3) means that which falls under any of the following items:
(i)solicitation with a view to delivering existing securities by a Financial Instruments Business Operator, etc. to Professional Investors, etc. for itself;
(ii)solicitation with a view to delivering existing securities to Non-Residents by entrusting it to Foreign Securities Services Provider;
(iii)offering to sell Share Certificates, etc. (meaning the Share Certificates, etc. set forth in Article 27-2, paragraph (1) of the Act) in response to a Tender Offer (meaning the Tender Offer set forth in Article 27-2, item (vi) of the Act; the same applies in Section 1 of the following Chapter);
(iv)solicitation with a view to delivering existing securities to an Officer, etc. (limited to an Officer, etc. that purchases the relevant Securities for Professional Investors (limited to purchase based on a contract under which the Officer, etc., will continually purchase Securities for Professional Investors jointly with another Officer, etc. of the issuer according to a fixed plan and without depending on an individual investment decision, for which each Officer, etc. contributes less than one million yen on each occasion)) of the issuer of the Securities for Professional Investors (limited to the following ones) that are the subject of the solicitation with a view to delivering existing securities:
(a)the Securities set forth in Article 2, paragraph (1), item (ix) of the Act;
(b)among the Securities set forth in Article 2, paragraph (1), item (xi) of the Act, Investment Securities, etc. or Investment Equity Subscription Right Certificates, etc.;
(c)among the Securities set forth in Article 2, paragraph (1), item (xvii) of the Act, those which have the nature of the Securities set forth in item (ix) of that paragraph;
(d)Securities as set forth in Article 2, paragraph (1), item (xx) of the Act that indicate rights associated with the Securities set forth in (a), (b) or (c); or
(e)Certificates of a beneficial interest in a securities trust of which the Entrusted Securities are the Securities set forth in (a), (b) or (c).
(3)The Securities specified by Cabinet Order that are provided for in Article 4, paragraph (3), item (iv) of the Act are the following Securities:
(i)the Securities which were Specified Listed Securities;
(ii)the Over-the-Counter Traded Securities, sold or purchased solely in, among the Over-the-Counter Securities Markets, those in which the Authorized Financial Instruments Firms Association that establishes the relevant Over-the-Counter Securities Market prohibits Purchases for General Investors, etc. (meaning Purchases for General Investors, etc. as prescribed in Article 67, paragraph (3) of the Act) pursuant to the provisions of its articles of incorporation (hereinafter referred to as the "Specified Over-the-Counter Traded Securities"); or
(iii)the Securities which were Specified Over-the-Counter Traded Securities.
(Scope of Regulated Securities)
Article 2-13The Securities specified by Cabinet Order that are provided for in Article 5, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act) (hereinafter referred to as the "Regulated Securities" in this Chapter) are as follows:
(i)the Securities set forth in Article 2, paragraph (1), items (iv), (viii), (xiii), and (xv) of the Act (with regard to the Securities set forth in Article 2, paragraph (1), item (xv) of the Act, the Securities are limited to the Specified Promissory Note set forth in the Asset Securitization Act);
(ii)the Securities set forth in Article 2, paragraph (1), items (x) and (xi) of the Act;
(iii)the Securities set forth in Article 2, paragraph (1), item (xiv) of the Act (excluding those falling under the category of Certificates of a beneficial interest in a securities trust);
(iv)the Securities set forth in Article 2, paragraph (1), item (xvi) of the Act;
(v)the Securities set forth in Article 2, paragraph (1), item (xviii);
(vi)Certificates of a beneficial interest in a securities trust (limited to those of which the Entrusted Securities are the Securities set forth in the preceding items);
(vii)the Rights in a Securities Investment Business, etc. (meaning the Rights in a Securities Investment Business, etc. prescribed in Article 3, item (iii), (a) of the Act; the same applies hereinafter) which are deemed to be Securities pursuant to the provisions of Article 2, paragraph (2) of the Act (excluding the claims prescribed in Article 1-3-4);
(viii)the rights set forth in Article 2, paragraph (2), item (i) of the Act which are deemed to be Securities pursuant to the provisions of that paragraph (limited to those falling under the category of Electronically Recorded Transferable Rights and excluding those falling under the category of Certificates of a beneficial interest in a securities trust);
(ix)the rights set forth in Article 2, paragraph (2), item (ii) of the Act which are deemed to be Securities pursuant to the provisions of that paragraph (limited to those falling under the category of Electronically Recorded Transferable Rights);
(x)among the rights set forth in Article 2, paragraph (2), item (iii) of the Act which are deemed to be Securities pursuant to the provisions of that paragraph (limited to those falling under the category of Electronically Recorded Transferable Rights), membership rights in a general partnership company, limited partnership company or limited liability company that carries out investment in Securities by allocating an amount exceeding 50 percent of the total investment;
(xi)among the rights set forth in Article 2, paragraph (2), item (iv) of the Act which are deemed to be Securities pursuant to the provisions of that paragraph (limited to those falling under the category of Electronically Recorded Transferable Rights), those which have the nature of the rights set forth in the preceding item;
(xii)the rights set forth in Article 2, paragraph (2), items (v) and (vi) of the Act which are deemed to be Securities pursuant to the provisions of that paragraph (limited to those falling under the category of Electronically Recorded Transferable Rights); and
(xiii)anything specified by Cabinet Office Order as being equivalent to what is set forth in the preceding items.
(Securities Equivalent to Listed Securities)
Article 3The Securities specified by Cabinet Order referred to in Article 6, item (ii) of the Act (including as applied mutatis mutandis pursuant to Article 12, Article 23-12, paragraph (1), Article 24, paragraph (7), Article 24-2, paragraph (3) and Article 24-4-2, paragraph (5) of the Act (including as applied mutatis mutandis pursuant to Article 24-4-8, paragraph (1) and Article 24-5-2, paragraph (1) of the Act), Article 24-4-3, paragraph (2) of the Act (including as applied mutatis mutandis pursuant to Article 24-4-8, paragraph (2) and Article 24-5-2, paragraph (2) of the Act), Article 24-4-4, paragraph (5), Article 24-4-5, paragraph (2), Article 24-4-7, paragraph (5), Article 24-5, paragraph (6) and Article 24-6, paragraph (3) of the Act, and the cases in which these provisions (excluding Article 24-6, paragraph (3) of the Act) are applied mutatis mutandis pursuant to Article 27 of the Act; hereinafter the same applies in this Article) and the Securities specified by Cabinet Order as those for which the state of distribution referred to in Article 24, paragraph (1), item (ii) of the Act (including as applied mutatis mutandis pursuant to Article 24, paragraph (5) of the Act and as applied mutatis mutandis pursuant to Article 27 of the Act) can be regarded as being equivalent to the Securities set forth in Article 24, paragraph (1), item (i) of the Act are Over-the-Counter Traded Securities and the Authorized Financial Instruments Firms Association specified by Cabinet Order as referred to in Article 6, item (ii) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act), Article 24-7, paragraph (4), item (ii) of the Act (including as applied mutatis mutandis pursuant to Article 24-7, paragraph (6) of the Act and as applied mutatis mutandis pursuant to Article 27 of the Act), Article 25, paragraphs (3) and (5) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act), Article 27-30-2, Article 27-30-6, paragraph (1), and Article 27-30-8, paragraph (1) of the Act is an Authorized Financial Instruments Firms Association which registers the Over-the-Counter Traded Securities.
(Securities Specified by Cabinet Order That Are Provided for in Article 15, Paragraph (3) of the Act)
Article 3-2The Securities specified by Cabinet Order that are provided for in Article 15, paragraph (3) of the Act are the Securities set forth in Article 2, paragraph (1), items (x) and (xi) of the Act.
(Book-Entry Corporate Bonds Specified by Cabinet Order That Are Provided for in Article 23-8, Paragraph (2) of the Act)
Article 3-2-2The book-entry corporate bonds, etc. specified by Cabinet Order that are provided for in Article 23-8, paragraph (2) of the Act are as follows:
(i)the short-term bonds as provided in the Insurance Business Act;
(ii)the Specified Short-Term Corporate Bonds as provided in the Asset Securitization Act;
(iii)the Short-Term Investment Corporation Bonds as provided in the Act on Investment Trusts and Investment Corporations; or
(iv)the Securities set forth in Article 2, paragraph (1), item (xvii) of the Act (including the Foreign Investment Securities which are similar to the investment corporation bond certificate as provided in the Act on Investment Trusts and Investment Corporations; the same applies in item (iii) of the following Article) which are specified by Cabinet Office Order as being equivalent to the short-term corporate bonds as provided in the Act on Transfer of Corporate Bonds, etc. or those set forth in the preceding three items.
(Solicitation Not Requiring Notice as Regards Solicitation to a Small Number of Investors)
Article 3-3The solicitation specified by Cabinet Order that is provided for in Article 23-13, paragraph (4) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act) is a solicitation with a view to delivering new securities or solicitation with a view to delivering existing securities (limited to that which falls under the cases specified in the items of that paragraph) issued for the following Securities:
(i)Certificates of Rights to Subscribe for Preferred Equity;
(ii)the Securities set forth in Article 2, paragraph (1), item (xv) of the Act (including the Securities set forth in item (xvii) of that Article which have the nature of the Securities set forth in item (xv) of that paragraph); or
(iii)the Specified Short-Term Corporate Bonds as provided in the Asset Securitization Act, short-term corporate bonds as provided in the Act on Transfer of Corporate Bonds, etc., short-term corporate bonds as provided in the Insurance Business Act, and the Short-Term Investment Corporation Bond as provided in the Act on Investment Trusts and Investment Corporations (including the Securities set forth in Article 2, paragraph (1), item (xvii) of the Act which are specified by Cabinet Office Order as being equivalent thereto).
(Deadline for Submission of Annual Securities Reports for a Foreign Person)
Article 3-4The period specified by Cabinet Order that is provided for in Article 24, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 24, paragraph (5) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act; hereinafter the same applies in this Article) and Article 27 of the Act) is six months; provided, however, that if the foreign person that is the issuer of the Securities set forth in the items of Article 24, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act) or in Article 24, paragraph (1), items (i) to (iii) of the Act as applied mutatis mutandis pursuant to Article 24, paragraph (5) of the Act is found to be unable to submit the Annual Securities Report within six months after the end of its business year due to the laws and regulations or practices in its state or any other compelling reasons, that period is the period approved in advance by the Commissioner of the Financial Services Agency pursuant to the provisions of Cabinet Office Order.
(Scope of Securities That Make It Unnecessary to Submit an Annual Securities Report)
Article 3-5(1)The Securities specified by Cabinet Order that are provided for in the proviso to Article 24, paragraph (1) of the Act are the following Securities:
(i)share certificates;
(ii)the Securities set forth in Article 2, paragraph (1), item (xvii) of the Act which have the nature of share certificates;
(iii)Certificates of a beneficial interest in a securities trust of which the Entrusted Securities are the Securities set forth in the preceding item; or
(iv)Securities as set forth in Article 2, paragraph (1), item (xx) of the Act that indicate rights associated with the Securities set forth in item (ii).
(2)The number calculated pursuant to the provisions of Cabinet Order that is provided for in the proviso to Article 24, paragraph (1) of the Act is 300.
(Amount of Assets That Makes It Unnecessary to Submit an Annual Securities Report)
Article 3-6(1)The amount that is specified by Cabinet Order as the amount of assets that is provided for in the proviso to Article 24, paragraph (1) of the Act is the amount of the stated capital.
(2)The amount specified by Cabinet Order that is provided for in the proviso to Article 24, paragraph (1) of the Act is the following amount for the category of the Electronically Recorded Transferable Rights set forth in the following items:
(i)the rights set forth in Article 2, paragraph (2), item (i) of the Act (limited to Certificates of a beneficial interest in a securities trust of which the Entrusted Securities are share certificates): 500 million yen; and
(ii)the rights set forth in Article 2, paragraph (2), item (iii) of the Act: 100 million yen.
(3)The number specified by Cabinet Order that is provided for in the proviso to Article 24, paragraph (1) of the Act is 300.
(4)The Securities specified by Cabinet Order as those for which the state of distribution can be regarded as being equivalent to Specified Listed Securities as prescribed in Article 24, paragraph (1), item (ii) of the Act are Specified Over-the-Counter Traded Securities.
(5)The Securities specified by Cabinet Order that are provided for in Article 24, paragraph (1), item (iv) of the Act are share certificates, Certificates of a beneficial interest in a securities trust of which the Entrusted Securities are share certificates, the Securities set forth in Article 2, paragraph (1), item (xx) of the Act that indicate rights associated with share certificates, and, among Electronically Recorded Transferable Rights which are deemed to be Securities pursuant to the provisions of paragraph (2) of the Article (excluding those falling under Regulated Securities), the rights set forth in item (iii) of that paragraph.
(6)The number specified by Cabinet Order that are provided for in Article 24, paragraph (1), item (iv) of the Act is the following number for the category of the Securities set forth in the following items:
(i)share certificates, Certificates of a beneficial interest in a securities trust of which the Entrusted Securities are share certificates, and Securities set forth in Article 2, paragraph (1), item (xx) that indicate rights associated with share certificates: 1000 (if the Securities are Securities for Professional Investors, the number obtained by adding the number of Professional Investors calculated pursuant to the provisions of Cabinet Office Order to 1000); and
(ii)Securities other than the Securities set forth in the preceding item: 500.
(Acknowledgement That an Annual Securities Report Need Not Be Submitted)
Article 4(1)If an issuer of Securities as set forth in Article 24, paragraph (1), item (iii) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act; hereinafter the same applies in this Article) or Article 24, paragraph (1), item (iv) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act) (excluding the issuer of the Securities which fall under the category of Regulated Securities; the same applies in the following paragraph) seeks the acknowledgement set forth in the proviso to Article 24, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act), the issuer must submit a written application for acknowledgement with its articles of incorporation, a copy of its shareholder registry, and any other documents specified by Cabinet Office Order to the Commissioner of the Financial Services Agency.
(2)If the application for acknowledgement referred to in the preceding paragraph has been filed, and the Commissioner of the Financial Services Agency finds that the person filing the application falls under any of the following items, the commissioner is to acknowledge that Annual Securities Reports need not be submitted for the business years starting from the business year that includes the day on which the application has been filed (if the day is a day within three months after the commencement of the business year (if the person is a foreign person, within the period specified in Article 3-4; hereinafter the same applies in this paragraph), the immediately preceding business year) and lasting until the business year immediately preceding the business year that includes the day on which the person comes to no longer fall under the relevant item (if the day is a day within three months after the commencement of a business year, the immediately preceding business year):
(i)a person in liquidation;
(ii)a person whose business has been suspended for a considerable period; or
(iii)an issuer of the Securities set forth in Article 24, paragraph (1), item (iii) of the Act for which the number of the holders of those Securities as calculated pursuant to the provisions of Cabinet Office Order is less than the number specified by Cabinet Office Order.
(3)The acknowledgement referred to in the preceding paragraph is to be given on the condition that the person referred to in that paragraph submits a copy of the shareholder registry and other documents specified by Cabinet Office Order to the Commissioner of the Financial Services Agency within three months after the end of each business year (limited to the business year that includes the day on which the application set forth in the preceding paragraph has been made and those which end within the period specified by Cabinet Office Order after the day of the end of the business year) (if the person is a foreign person, within the period specified in Article 3-4) pursuant to the provisions of Cabinet Office Order.
(4)In a case in which an application for acknowledgement referred to in paragraph (1) has been filed (excluding cases in which the acknowledgement under paragraph (2) has been given), if the person filing that application is a person that is subject to a ruling for commencement of reorganization proceedings and the application has been filed within three months after the day on which the ruling for commencement of reorganization proceedings has been issued, the Commissioner of the Financial Services Agency is to acknowledge that the person is not required to submit an Annual Securities Report for the business year that includes the day on which the ruling for commencement of reorganization proceedings was issued.
(Acknowledgement That an Annual Securities Report Need Not Be Submitted in Connection with Regulated Securities)
Article 4-2(1)The provisions of paragraph (1) of the preceding Article apply mutatis mutandis when the issuer of the Securities set forth in Article 24, paragraph (1), items (iii) and (iv) of the Act which fall under the category of Regulated Securities seeks the acknowledgement prescribed in the proviso to Article 24, paragraph (1) of the Act as applied mutatis mutandis pursuant to Article 24, paragraph (5) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act) and the provisions of paragraphs (2) and (3) of the preceding Article apply mutatis mutandis to that acknowledgement. In this case, the phrases "the application has been filed" and "business year" in paragraph (2) of the preceding Article is deemed to be replaced with "the application has been filed with regard to the Securities" and "specified period" respectively, the phrase "the Securities set forth in Article 24, paragraph (1), item (iii) of the Act" in paragraph (2), item (iii) of the preceding Article are deemed to be replaced with "the Securities set forth in Article 24, paragraph (1), item (iii) of the Act which fall under the category of Regulated Securities" and the phrases "each business year" and "the business year that includes the day on which the application set forth in the preceding paragraph was filed and those which end within the period specified by Cabinet Office Order after the day of the end of that business year" in paragraph (3) of the preceding Article are deemed to be replaced with "each specified period with regard to the Securities" and "the specified period that includes the day on which the application set forth in the preceding paragraph was filed and those which end within the period specified by Cabinet Office Order after the day of the end of that specified period" respectively.
(2)The amount specified by Cabinet Order as the amount of stated capital of the company, as provided in the proviso to Article 24, paragraph (1) of the Act as applied mutatis mutandis pursuant to Article 24, paragraph (5) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act; hereinafter the same applies in this Article) following the deemed replacement of terms, is as specified in the relevant of the following items for the category of Rights in Securities Investment Business, etc. or Electronically Recorded Transferable Rights set forth in the following items:
(i)the rights set forth in Article 2, paragraph (2), item (i) of the Act: the total value of assets belonging to a trust property;
(ii)the rights set forth in Article 2, paragraph (2), item (iii) of the Act: the amount of stated capital; and
(iii)the rights set forth in Article 2, paragraph (2), item (v) of the Act: the total amount of investment or contribution.
(3)The amount specified by Cabinet Order referred to in the proviso to Article 24, paragraph (1) of the Act as applied mutatis mutandis pursuant to Article 24, paragraph (5) of the Act following the deemed replacement of terms is 100 million yen.
(4)The Securities specified by Cabinet Order referred to in Article 24, paragraph (1), item (iv) of the Act as applied mutatis mutandis pursuant to Article 24, paragraph (5) of the Act following the deemed replacement of terms are, among the Rights in Securities Investment Business, etc. which are deemed to be Securities pursuant to the provisions of Article 2, paragraph (2) of the Act, the rights set forth in items (i), (iii), and (v) of that paragraph, and among Electronically Recorded Transferable Rights which are deemed to be Securities pursuant to the provisions of the same paragraph (limited to those falling under Regulated Securities), the rights set forth in item (i) of that paragraph (excluding those falling under Certificates of a beneficial interest in a securities trust), and the rights set forth in items (iii) and (v) of that paragraph.
(5)The number specified by Cabinet Order referred to in Article 24, paragraph (1), item (iv) of the Act as applied mutatis mutandis pursuant to Article 24, paragraph (5) of the Act following the deemed replacement of terms are 500.
(Deadline for Submission of Foreign Company Reports)
Article 4-2-2The period specified by Cabinet Order that is provided for in Article 24, paragraphs (1) and (5) of the Act as applied pursuant to the provisions of Article 24, paragraph (10) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act) following the deemed replacement of terms is four months; provided, however, that if the Reporting Foreign Company (meaning the Reporting Foreign Company defined in Article 24, paragraph (8) of the Act; the same applies hereinafter) is found to be unable to submit its Foreign Company Reports (meaning the Foreign Company Reports prescribed in Article 24, paragraph (8) of the Act; the same applies hereinafter) within four months after the end of its business year due to the laws and regulations or practices in its state or any other compelling reasons, that period is the period approved in advance by the Commissioner of the Financial Services Agency, pursuant to the provisions of Cabinet Office Order.
(Deadline for Submission of an Annual Securities Report If the Relevant Person Has Been Notified That It Is Not Allowed to Submit a Foreign Company Report)
Article 4-2-3The period specified by Cabinet Order that is provided for in Article 24, paragraph (13) of the Act (including as applied mutatis mutandis pursuant to Article 24-7, paragraph (5) of the Act (including as applied mutatis mutandis pursuant to Article 24-7, paragraph (6) of the Act) and as applied mutatis mutandis pursuant to Article 27 of the Act) is a period from the day on which the notice under Article 24, paragraph (12) of the Act has been given until the last day of the period in which the Annual Securities Report under Article 24, paragraph (1) of the Act is to be submitted, if the submission thereof has been decided pursuant to Article 24, paragraph (1) of the Act, or until the day on which one month has elapsed from the day of notice, whichever comes later.
(Public Notice of Submission of Amendment Reports)
Article 4-2-4(1)The public notice under Article 24-2, paragraph (2) of the Act must be given by any of the following means without delay after the submission of amendment reports referred to in that paragraph:
(i)by taking measures to make the information that is required to be given in a public notice available to many and unspecified persons by a means that involves the use of an Electronic Data Processing System for Disclosure (meaning an Electronic Data Processing System for Disclosure as defined in Article 27-30-2 of the Act; the same applies hereinafter) pursuant to the provisions of Cabinet Office Order (hereinafter referred to as "Electronic Public Notice" in this Article); or
(ii)by publication in a daily newspaper that publishes information on current affairs, pursuant to the provisions of Cabinet Office Order.
(2)A person that gives public notice by way of Electronic Public Notice pursuant to the preceding paragraph must continue to provide the public notice by way of Electronic Public Notice until the last day in the five-year period after the day on which the person submitted the Annual Securities Report and the documents attached thereto for which the amendment reports set forth in Article 24-2, paragraph (2) of the Act have been submitted.
(3)If a person giving public notice by way of Electronic Public Notice pursuant to the provisions of paragraph (1) is unable to give the public notice by way of Electronic Public Notice due to a fault in a telecommunications line or any other cause, the person must give public notice, in lieu of the Electronic Public Notice, by the method set forth in paragraph (1), item (ii) or another method specified by Cabinet Office Order with the approval of the Commissioner of the Financial Services Agency pursuant to the provisions of Cabinet Office Order.
(4)Notwithstanding the provisions of paragraph (2), if public notice is interrupted (meaning that the information that had been put into a format that allowed many and unspecified persons to be provided with it is no longer available in that format or has been altered after having been made available in that format; hereinafter the same applies in this paragraph) during the period in which the public notice by way of Electronic Public Notice is to be given pursuant to paragraph (2) (such a period is referred to as a "Public Notice Period" in item (ii)), and all of the following conditions are met, the interruption of the public notice does not impact the effect of the public notice:
(i)if the person that giving public notice by way of Electronic Public Notice has acted in good faith and without gross negligence as regards the interruption of that public notice or if that person has legitimate grounds for interrupting the public notice;
(ii)the total time during which the public notice was interrupted does not exceed one-tenth of the Public Notice Period; and
(iii)promptly after learning that the public notice had been interrupted, the person giving public notice by way of Electronic Public Notice has given public notice of this by appending an indication of this and of the time at which the public notice was interrupted and the details of the interruption to the relevant public notice, pursuant to the provisions of Cabinet Office Order.
(Scope of Companies Required to Submit a Confirmation Letter)
Article 4-2-5(1)The company specified by Cabinet Order that is provided for in Article 24-4-2, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act) is the issuer of the Securities set forth in Article 24, paragraph (1), item (i) or (ii) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act) (limited to Securities that fall under the category of Securities set forth in the following items):
(i)share certificates;
(ii)Preferred Equity Securities;
(iii)the Securities set forth in Article 2, paragraph (1), item (xvii) of the Act which have the nature of the Securities set forth in the preceding two items;
(iv)Certificates of a beneficial interest in a securities trust of which the Entrusted Securities are the Securities set forth in the preceding three items; or
(v)Securities as set forth in Article 2, paragraph (1), item (xx) of the Act that indicate rights associated with the Securities set forth in item (i) to item (iii).
(2)If the provisions of the Act are applied mutatis mutandis when a person submits an Amendment Report (meaning an Amendment Report as set forth in Article 24-2, paragraph (1) of the Act; hereinafter the same applies in this paragraph) pursuant to the provisions of Article 7, paragraph (1), Article 9, paragraph (1), or Article 10, paragraph (1) of the Act as applied mutatis mutandis pursuant to Article 24-2, paragraph (1) of the Act following the deemed replacement of terms under Article 24-4-2, paragraph (4) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act; hereinafter the same applies in this paragraph), the deemed replacement of terms under Article 24-4-2, paragraph (4) of the Act is as given in the following table:
Provisions of the Act whose terms are deemed to be replaced
Original terms
Terms deemed to replace the original terms
Article 24-4-2, paragraph (1)
statements contained in the Annual Securities Report
statements contained in the Amendment Reports
Annual Securities Reports, etc.
Amendment Reports
Foreign Company Reports
documents similar to that Amendment Reports which have been prepared in English
a Foreign Company Report
documents similar to that Amendment Reports which have been prepared in English
Article 24-4-2, paragraph (2)
together with an Annual Securities Report
together with Amendment Reports
(3)If the provisions of the Act are applied mutatis mutandis when a Confirmation Letter (meaning a confirmation letter as prescribed in Article 24-4-2, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act); the same applies hereinafter) has been submitted pursuant to the provisions of Article 24-4-2, paragraph (1) or (2) of the Act (including as applied mutatis mutandis pursuant to Article 24-4-2, paragraph (3) of the Act (including as applied mutatis mutandis pursuant to Article 24-4-2, paragraph (4) of the Act) and Article 24-4-2, paragraph (4) of the Act, and when these provisions are applied mutatis mutandis pursuant to Article 27 of the Act) under Article 24-4-2, paragraph (5) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act, hereinafter the same applies in this paragraph), the deemed replacement of terms under Article 24-4-2, paragraph (5) of the Act is as given in the following table:
Provisions of the Act whose terms are deemed to be replaced
Original terms
Terms deemed to replace the original terms
Article 6
the statement set forth in paragraph (1) of the preceding Article and of other documents required under paragraph (13) of the preceding Article
a Confirmation Letter
(4)If the provisions of the Act are applied mutatis mutandis when a Reporting Foreign Company submits a Confirmation Letter pursuant to Article 24-4-2, paragraph (1) or (2) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act) under Article 24-4-2, paragraph (6) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act; hereinafter the same applies in this paragraph) (limited to if the Reporting Foreign Company has submitted Foreign Company Reports), the deemed replacement of terms under Article 24-4-2, paragraph (6) of the Act is as given in the following table:
Provisions of the Act whose terms are deemed to be replaced
Original terms
Terms deemed to replace the original terms
Article 24, paragraphs (8), (9) and (11) to (13)
Annual Securities Reports
Confirmation Letters
Foreign Company Reports
Foreign Company Confirmation Letters
Reporting Foreign Company
foreign company
(Deemed Replacement of Terms in Connection with Amended Confirmation Letters)
Article 4-2-6(1)If the provisions of the Act are applied mutatis mutandis to the Confirmation Letter under Article 24-4-3, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act; hereinafter the same applies in this Article), the deemed replacement of terms under Article 24-4-3, paragraph (1) of the Act is as given in the following table:
Provisions of the Act whose terms are deemed to be replaced
Original terms
Terms deemed to replace the original terms
Article 7
the statement or any of those other documents
the Confirmation Letter
Article 9, paragraph (1)
Article 5, paragraph (1) and paragraph (13)
the Confirmation Letter or the Amendment Confirmation Letter set forth in Article 7
the statement(s)
the Amendment Confirmation Letter(s)
Article 10, paragraph (1)
Securities Registration Statements
Confirmation Letters
(2)If the provisions of the Act are applied mutatis mutandis when an amended Confirmation Letter (meaning an amended Confirmation Letter as referred to in Article 24-4-3, paragraph (1) of the Act; the same applies hereinafter) for a Confirmation Letter has been submitted pursuant to the provisions of Article 7, paragraph (1), Article 9, paragraph (1) or Article 10, paragraph (1) of the Act as applied mutatis mutandis pursuant to Article 24-4-3, paragraph (1) of the Act under Article 24-4-3, paragraph (2) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act; hereinafter the same applies in this paragraph), the deemed replacement of terms under Article 24-4-3, paragraph (2) of the Act is as given in the following table:
Provisions of the Act whose terms are deemed to be replaced
Original terms
Terms deemed to replace the original terms
Article 6
the statement set forth in paragraph (1) of the preceding Article and of other documents required under paragraph (13) of the preceding Article
Amendment Confirmation Letter
(3)If the provisions of the Act are applied mutatis mutandis when a foreign company submits an amended Confirmation Letter for a Confirmation Letter submitted thereby pursuant to the provisions of Article 7, paragraph (1), Article 9, paragraph (1) or Article 10, paragraph (1) of the Act as applied mutatis mutandis pursuant to Article 24-4-3, paragraph (1) of the Act under Article 24-4-3, paragraph (3) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act; hereinafter the same applies in this paragraph), the deemed replacement of terms under Article 24-4-3, paragraph (3) of the Act is as given in the following table:
Provisions of the Act whose terms are deemed to be replaced
Original terms
Terms deemed to replace the original terms
Article 24, paragraph (8)
Annual Securities Report
Amendment Confirmation Letter
a foreign company required to submit Annual Securities Reports under paragraph (1) (including the cases where it is applied mutatis mutandis pursuant to paragraph (5); hereinafter the same applies in this paragraph to paragraph (13)) (including foreign companies which have submitted Annual Securities Reports under Article 23-3, paragraph (4); hereinafter referred to as a "Reporting Foreign Company")
a foreign company required to submit Annual Securities Reports under paragraph (1) (including the cases where it is applied mutatis mutandis pursuant to paragraph (5); hereinafter the same applies in this paragraph to paragraph (13)) (limited to foreign companies that have submitted the Foreign Company Reports)
Annual Securities Reports to be submitted under paragraph (1) and the documents to be attached thereto under paragraph (6) (hereinafter collectively referred to as "Annual Securities Reports, etc." in this Article)
an Amendment Confirmation Letter
are similar to Annual Securities Reports, etc. Disclosed in a Foreign State (meaning the state of having been made available for public inspection based on laws and regulations under the foreign state (including the rules provided for by the operator of a Foreign Financial Instruments Market or other person specified by Cabinet Office Order); the same applies hereinafter in Article 24-4-7, paragraph (6) and Article 24-5, paragraph (7))
contain the matters to be stated on the Amendment Confirmation Letter
Foreign Company Reports
Foreign Company Amendment Confirmation Letter
Article 24, paragraph (9)
Foreign Company Report(s)
Foreign Company Amendment Confirmation Letter
and documents stating the matters specified by Cabinet Office Order as those necessary and appropriate for the public interest or protection of investors among the matters not stated in the Foreign Company Report, and other documents
and other documents
Article 24, paragraph (11)
Reporting Foreign Company
foreign company (limited to the foreign companies that have submitted a Foreign Company Report)
Foreign Company Report
Foreign Company Amendment Confirmation Letter
to be Annual Securities Reports, etc.
to be Amendment Confirmation Letters
Annual Securities Reports, etc.
Amendment Confirmation Letters
(Scope of Companies Required to Submit an Internal Control Report)
Article 4-2-7(1)The person specified by Cabinet Order provided for in Article 24-4-4, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act) is the issuer of the Securities set forth in Article 24, paragraph (1), item (i) or (ii) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act) (limited to the Securities that fall under the category of the Securities set forth in the following items):
(i)share certificates;
(ii)Preferred Equity Investment Certificates;
(iii)the Securities set forth in Article 2, paragraph (1), item (xvii) of the Act which have the nature of the Securities set forth in the preceding two items;
(iv)Certificates of a beneficial interest in a securities trust of which the Entrusted Securities are the Securities set forth in the preceding three items; or
(v)Securities as set forth in Article 2, paragraph (1), item (xx) of the Act that indicate rights associated with the Securities set forth in item (i) to item (iii).
(2)If the provisions of the Act are applied mutatis mutandis when an Internal Control Report (meaning the Internal Control Report prescribed in Article 24-4-4, paragraph (1) of the Act; the same applies hereinafter) and the documents attached thereto have been submitted pursuant to the provisions of Article 24-4-4, paragraph (1) or (2) of the Act (including cases in which they are applied mutatis mutandis pursuant to Article 24-4-4, paragraph (3) of the Act and as applied mutatis mutandis pursuant to Article 27 of the Act; hereinafter the same applies in this Article and the following Article) and Article 24-4-4, paragraph (4) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act) under Article 24-4-5, paragraph (5) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act; hereinafter the same applies in this paragraph), the deemed replacement of terms under Article 24-4-4, paragraph (5) of the Act is as given in the following table:
Provisions of the Act whose terms are deemed to be replaced
Original terms
Terms deemed to replace the original terms
Article 6
the statement set forth in paragraph (1) of the preceding Article and of other documents required under paragraph (13) of the preceding Article
its Internal Control Report and the documents attached thereto
(3)If the provisions of the Act are applied mutatis mutandis when a Reporting Foreign Company submits the Internal Control Report under Article 24-4-4, paragraph (1) or (2) of the Act pursuant to Article 24-4-4, paragraph (6) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act; hereinafter the same applies in this paragraph) (limited to if the Reporting Foreign Company has submitted a Foreign Company Report), the deemed replacement of terms under Article 24-4-4, paragraph (6) of the Act is as given in the following table:
Provisions of the Act whose terms are deemed to be replaced
Original terms
Terms deemed to replace the original terms
Article 24, paragraphs (8), (9) and (11) to (13)
Foreign Company Report
Foreign Company Internal Control Report
Reporting Foreign Company
Foreign Company
Annual Securities Report
Internal Control Report
(Deemed Replacement of Terms in Connection with Amendment of Internal Control Reports)
Article 4-2-8(1)If the provisions of the Act are applied mutatis mutandis to an Internal Control Report and the documents attached thereto under Article 24-4-5, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act; hereinafter the same applies in this Article), the deemed replacement of terms under Article 24-4-5, paragraph (1) of the Act is as given in the following table:
Provisions of the Act whose terms are deemed to be replaced
Original terms
Terms deemed to replace the original terms
Article 7
a statement set forth in Article 5, paragraph (1) or in other documents required under Article 5, paragraph (6)
its Internal Control Report and the documents attached thereto
Article 9, paragraph (1)
Article 5, paragraph (1) and paragraph (13)
its Internal Control Report and the documents attached thereto and the amendment reports and other documents set forth in Article 7
the statement(s)
the amendment reports
Article 10, paragraph (1)
a (the) Securities Registration Statement
An (the) Internal Control Report and the documents attached thereto
(2)If the provisions of the Act are applied mutatis mutandis when an Amendment Report (meaning the Amendment Report set forth in Article 24-4-5, paragraph (1) of the Act; hereinafter the same applies in this Article and the following Article) has been submitted for an Internal Control Report and the documents attached thereto pursuant to the provisions of Article 7, paragraph (1), Article 9, paragraph (1) or Article 10, paragraph (1) of the Act as applied mutatis mutandis pursuant to Article 24-4-5, paragraph (1) of the Act under Article 24-4-5, paragraph (2) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act; hereinafter the same applies in this paragraph), the deemed replacement of terms under Article 24-4-5, paragraph (2) of the Act is as given in the following table:
Provisions of the Act whose terms are deemed to be replaced
Original terms
Terms deemed to replace the original terms
Article 6
the statement set forth in paragraph (1) of the preceding Article and of other documents required under paragraph (13) of the preceding Article
the respective Amendment Reports
(3)If the provisions of the Act are applied mutatis mutandis when a foreign company submits an Amendment Report for the Internal Control Report submitted thereby pursuant to the provisions of Article 7, paragraph (1), Article 9, paragraph (1) or Article 10, paragraph (1) of the Act as applied mutatis mutandis pursuant to Article 24-4-5, paragraph (1) of the Act following the deemed replacement of terms under Article 24-4-5, paragraph (3) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act; hereinafter the same applies in this paragraph), the deemed replacement of terms under Article 24-4-5, paragraph (3) of the Act is as given in the following table:
Provisions of the Act whose terms are deemed to be replaced
Original terms
Terms deemed to replace the original terms
Article 24, paragraph (8)
Annual Securities Reports
Amendment Reports
a foreign company required to submit Annual Securities Reports under paragraph (1) (including the cases where it is applied mutatis mutandis pursuant to paragraph (5); hereinafter the same applies in this paragraph to paragraph (13)) (including foreign companies which have submitted Annual Securities Reports under Article 23-3, paragraph (4); hereinafter referred to as a "Reporting Foreign Company")
a foreign company required to submit Annual Securities Reports under paragraph (1) (including the cases where it is applied mutatis mutandis pursuant to paragraph (5); hereinafter the same applies in this paragraph to paragraph (13)) (limited to the foreign companies which have submitted the Foreign Company Reports)
Annual Securities Reports to be submitted under paragraph (1) and the documents to be attached thereto under paragraph (6) (hereinafter collectively referred to as "Annual Securities Reports, etc." in this Article)
Amendment Reports
and are similar to Annual Securities Reports, etc. Disclosed in a Foreign State (meaning the state of having been made available for public inspection based on laws and regulations under the foreign state (including the rules provided for by the operator of a Foreign Financial Instruments Market or other person specified by Cabinet Office Order); the same applies hereinafter in Articles 24-4-7, paragraph (6) and Article 24-5, paragraph (7))
and contain the matters to be stated in the Amendment Reports
Foreign Company Reports
Foreign Company Amendment Reports
Article 24, paragraph (9)
Foreign Company Reports
Foreign Company Amendment Reports
and documents stating the matters specified by Cabinet Office Order as those necessary and appropriate for the public interest or protection of investors among the matters not stated in the Foreign Company Report, and other documents
and other documents
Article 24, paragraph (11)
Reporting Foreign Company
foreign company (limited to the foreign companies which have submitted a Foreign Company Report)
Foreign Company Report
Foreign Company Amendment Report
Annual Securities Reports, etc.
Amendment Reports
Annual Securities Reports, etc.
Amendment Reports
(Deemed Replacement of Terms in Connection with Liability for Damages Related to an Internal Control Report)
Article 4-2-9If the provisions of the Act are applied mutatis mutandis to a case in which an Internal Control Report (including the Amendment Report thereof) contains a false statement about a material particular, omits a statement as to a material particular that is required to be stated, or omits a statement of material fact that is necessary to prevent it from being misleading, under Article 24-4-6 of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act; hereinafter the same applies in this Article), the deemed replacement of terms under Article 24-4-6 of the Act is as given in the following table:
Provisions of the Act whose terms are deemed to be replaced
Original terms
Terms deemed to replace the original terms
Article 22, paragraph (2)
the preceding paragraph
the preceding paragraph as applied mutatis mutandis pursuant to Article 24-4-6
(Scope of Companies Required to Submit a Quarterly Securities Report)
Article 4-2-10(1)The company that is the issuer and other persons specified by Cabinet Order that are provided for in Article 24-4-7, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act; hereinafter the same applies in this Article) means the issuer of the Securities set forth in Article 24, paragraph (1), item (i) or (ii) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act) (limited to the Securities that fall under the category of Securities set forth in the following items):
(i)share certificates;
(ii)Preferred Equity Securities;
(iii)the Securities set forth in Article 2, paragraph (1), item (xvii) of the Act which have the nature of the Securities set forth in the preceding two items;
(iv)Certificates of a beneficial interest in a securities trust of which the Entrusted Securities are the Securities set forth in the preceding three items; or
(v)the Securities set forth in Article 2, paragraph (1), item (xx) of the Act which indicate the rights of the Securities set forth in item (i) to item (iii).
(2)The period specified by Cabinet Order that is excluded from being treated as one of the three-month periods into which a business year is divided, as provided in Article 24-4-7, paragraph (1) of the Act, is the last of those three month periods.
(3)The period not exceeding 45 days designated by Cabinet Order that is provided for in Article 24-4-7, paragraph (1) of the Act is 45 days.
(4)The period not exceeding 60 days specified by Cabinet Order that is provided for in Article 24-4-7, paragraph (1) of the Act is the period specified in the relevant of the following items for the category of Quarter (meaning each three-month period of the business year as set forth in Article 24-4-7, paragraph (1) of the Act; hereinafter the same applies in this paragraph) set forth in that item:
(i)the Quarter following the first Quarter of the business year: 60 days; and
(ii)a Quarter other than the Quarter set forth in the preceding item: 45 days.
(5)If the provisions of the Act are applied mutatis mutandis to a Quarterly Securities Report (meaning a Quarterly Securities Report as defined in Article 24-4-7, paragraph (1) of the Act; the same applies hereinafter) under Article 24-4-7, paragraph (4) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act; hereinafter the same applies in this paragraph and the following paragraph), the deemed replacement of terms under Article 24-4-7, paragraph (4) of the Act is as given in the following table:
Provisions of the Act whose terms are deemed to be replaced
Original terms
Terms deemed to replace the original terms
Article 9, paragraph (1)
Article 5, paragraph (1) and paragraph (13)
the Quarterly Securities Report and the Amendment Reports set forth in Article 7
the statement(s)
the Amendment Reports
(6)If the provisions of the Act are applied mutatis mutandis to a case in which a Quarterly Securities Report or its Amendment Report (meaning the amendment report referred to in Article 24-4-7, paragraph (4) of the Act; hereinafter the same applies in this Article and the following Article) contains a false statement about a material particular, omits a statement as to a material particular that is required to be stated, or omits a statement of material fact that is necessary to prevent it from being misleading under Article 24-4-7, paragraph (4) of the Act, the deemed replacement of terms under Article 24-4-7, paragraph (4) of the Act is as given in the following table:
Provisions of the Act whose terms are deemed to be replaced
Original terms
Terms deemed to replace the original terms
Article 22, paragraph (1)
Securities Registration Statement
Quarterly Securities Report or the Amendment Reports thereof
(7)If the provisions of the Act are applied mutatis mutandis when a Quarterly Securities Report has been submitted pursuant to the provisions of Article 24-4-7, paragraph (1) or (2) of the Act (including as applied mutatis mutandis pursuant to Article 24-4-7, paragraph (3) of the Act and as applied mutatis mutandis pursuant to Article 27 of the Act; hereinafter the same applies in this Article and the following Article) and when an amendment report for the Quarterly securities Report has been submitted pursuant to the provisions of Article 7, paragraph (1), Article 9, paragraph (1) or Article 10, paragraph (1) of the Act as applied mutatis mutandis pursuant to Article 24-4-7, paragraph (4) of the Act, under Article 24-4-7, paragraph (5) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act), the deemed replacement of terms under Article 24-4-7, paragraph (5) of the Act is as given in the following table:
Provisions of the Act whose terms are deemed to be replaced
Original terms
Terms deemed to replace the original terms
Article 6
the statement set forth in paragraph (1) of the preceding Article and of other documents required under paragraph (13) of the preceding Article
the relevant Quarterly Securities Report and the Amendment Reports thereof
(8)The period specified by Cabinet Order that is provided for in Article 24-4-7, paragraph (10) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act) is a period from the day on which the notice under Article 24-4-7, paragraph (9) of the Act has been given until the last day of the period in which the Quarterly Securities Report under Article 24-4-7, paragraph (1) of the Act is to be submitted, if its submission has been decided pursuant to Article 24-4-7, paragraph (1) of the Act, or until the day on which 15 days have elapsed from the day of notice, whichever comes later.
(9)If the provisions of the Act are applied mutatis mutandis when a Reporting Foreign Company submits Amendment Reports for the Foreign Company Quarterly Securities Report (meaning the Foreign Company Quarterly Securities Report prescribed in Article 24-4-7, paragraph (6) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act)) and the Supplementary Documents therefor (meaning the Supplementary Documents prescribed in Article 24-4-7, paragraph (7) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act)) submitted thereby pursuant to the provisions of Article 7, paragraph (1), Article 9, paragraph (1) or Article 10, paragraph (1) of the Act as applied mutatis mutandis pursuant to Article 24-4-7, paragraph (4) of the Act following the deemed replacement of terms under Article 24-4-7, paragraph (11) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act; hereinafter the same applies in this paragraph), the deemed replacement of terms under Article 24-4-7, paragraph (11) of the Act is as given in the following table:
Provisions of the Act whose terms are deemed to be replaced
Original terms
Terms deemed to replace the original terms
Article 24-4-7, paragraph (6)
a Reporting Foreign Company required to submit Quarterly Securities Reports under paragraph (1)
a Reporting Foreign Company required to submit Amendment Reports for the Foreign Company Quarterly Securities Reports and the Supplementary Documents therefor which have been submitted thereby pursuant to the provisions of Article 7, Article 9, paragraph (1) or Article 10, paragraph (1) as applied mutatis mutandis pursuant to paragraph (4) following the deemed replacement of terms
Quarterly Securities Reports
Amendment Reports
Foreign Company Quarterly Securities Report
Amendment Reports for Foreign Company Quarterly Securities Reports
Article 24-4-7, paragraph (7)
Foreign Company Quarterly Securities Report
Amendment Reports for Foreign Company Quarterly Securities Reports
Article 24-4-7, paragraph (8)
Foreign Company Quarterly Securities Report
Amendment Reports for Foreign Company Quarterly Securities Reports
Quarterly Securities Reports
Amendment Reports
(Deemed Replacement of Terms in Connection with Confirmation Letters for Quarterly Securities Reports)
Article 4-2-11If the provisions of the Act are applied mutatis mutandis when a person submits a Quarterly Securities Report pursuant to Article 24-4-7, paragraph (1) or (2) of the Act and when a person submits an Amendment Report pursuant to the provisions of Article 7, paragraph (1), Article 9, paragraph (1) or Article 10, paragraph (1) of the Act as applied mutatis mutandis pursuant to Article 24-4-7, paragraph (4) of the Act following the deemed replacement of terms under Article 24-4-8, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act; hereinafter the same applies in this Article), the deemed replacement of terms under Article 24-4-8, paragraph (1) of the Act is as given in the following table:
Provisions of the Act whose terms are deemed to be replaced
Original terms
Terms deemed to replace the original terms
Article 24-4-2, paragraph (1)
the Annual Securities Report
the Quarterly Securities Report
(Deadline for the Submission of a Semiannual Securities Report If the Relevant Person Has Been Notified That It Is Not Allowed to Submit a Foreign Company Semiannual Securities Report)
Article 4-2-12The period specified by Cabinet Order that is provided for in Article 24-5, paragraph (11) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act) is the period from the day on which the notice under Article 24-5, paragraph (10) of the Act has been given until the last day of the period in which the Semiannual Securities Report under Article 24-5, paragraph (1) of the Act is to be submitted, if its submission has been decided pursuant to Article 24-5, paragraph (1) of the Act, or until the day on which 15 days have elapsed from the day of notice, whichever comes later.
(Deemed Replacement of Terms in Connection with Confirmation Letters for Semiannual Securities Reports)
Article 4-2-13If the provisions of the Act are applied mutatis mutandis when a person submits a Semiannual Securities Report pursuant to Article 24-5, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 24-5, paragraph (3) of the Act and as applied mutatis mutandis pursuant to Article 27 of the Act) and when a person submits an Amendment Report (meaning the Amendment Report set forth in Article 24-5, paragraph (5) of the Act) is to be submitted pursuant to the provisions of Article 7, paragraph (1), Article 9, paragraph (1) or Article 10, paragraph (1) of the Act as applied mutatis mutandis pursuant to Article 24-5, paragraph (5) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act; hereinafter the same applies in this Article) following the deemed replacement of terms under Article 24-5-2, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act), the deemed replacement of terms under Article 24-5-2, paragraph (1) of the Act is as given in the following table:
Provisions of the Act whose terms are deemed to be replaced
Original terms
Terms deemed to replace the original terms
Article 24-4-2, paragraph (1)
the Annual Securities Report
the Semiannual Securities Report
(Share Certificates Equivalent to Listed Share Certificates)
Article 4-3(1)The share certificates specified by Cabinet Order that are provided for in Article 24-6, paragraph (1) of the Act are share certificates that fall under the category of Over-the-Counter Traded Securities.
(2)The Securities specified by Cabinet Order that are provided for in Article 24-6, paragraph (1) of the Act are the following Securities:
(i)Investment Securities (meaning Investment Securities as prescribed in the Act on Investment Trusts and Investment Corporations; hereinafter the same applies in this paragraph) listed on a Financial Instruments Exchange;
(ii)Investment Securities that fall within the category of Over-the-Counter Traded Securities;
(iii)Certificates of a beneficial interest in a securities trust of which the Entrusted Securities are share certificates listed on a Financial Instruments Exchange, the share certificates set forth in the preceding paragraph or the Investment Securities set forth in the preceding two items;
(iv)Certificates of a beneficial interest in a securities trust (limited to those of which the Entrusted Securities are share certificates or Investment Securities; and excluding those falling under the preceding item) which fall under the category of Listed Securities (meaning the Securities listed on a Financial Instruments Exchange; the same applies in item (vi)) or Over-the-Counter Traded Securities;
(v)Securities as set forth in Article 2, paragraph (1), item (xx) of the Act that indicate rights associated with share certificates listed on a Financial Instruments Exchange, share certificates as provided in the preceding paragraph, or Investment Securities as set forth in item (i) or (ii); or
(vi)the Securities set forth in Article 2, paragraph (1), item (xx) of the Act (limited to Securities that indicate rights associated with share certificates or Investment Securities; and excluding those falling under the preceding item) which fall under the category of Listed Securities or Over-the-Counter Traded Securities.
(3)The decision of an organ specified by Cabinet Order that is provided for in Article 24-6, paragraph (1) of the Act is a resolution of the board of officers under Article 80-2, paragraph (3) of the Act on Investment Trusts and Investment Corporations.
(4)The meeting specified by Cabinet Order that is provided for in Article 24-6, paragraph (1) of the Act is the meeting of the board of officers at which the resolution set forth in the preceding paragraph has been made.
(5)The day specified by Cabinet Order that is provided for in Article 24-6, paragraph (1) of the Act is the day on which the period set forth in Article 80-2, paragraph (1), item (iv) of the Act on Investment Trusts and Investment Corporations as applied pursuant to the provisions of Article 80-5, paragraph (2) of that Act following the deemed replacement of terms is to expire.
(Companies Closely Related to the Relevant Person)
Article 4-4(1)The company specified by Cabinet Order that is provided for in Article 24-7, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act) is a company as follows:
(i)a company that holds the majority of the Voting Rights Held by All the Shareholders, etc. of a Subsidiary Company Submitting Annual securities Reports (meaning the Subsidiary Company Submitting Annual securities Reports prescribed in Article 24-7, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act); the same applies in the following item, Article 4-7, paragraph (1), Article 39, paragraph (3) and Article 41-2, paragraph (3)) in its own name or in another person's name (or under a fictitious name; hereinafter the same applies in this Article and Article 4-7); or
(ii)if a company and a corporation or other organization (meaning a corporation or any other organization; the same applies hereinafter) in which the company holds a majority of the Voting Rights Held by All the Shareholders, etc. in its own name or in another person's name, jointly hold the majority of the Voting Rights Held by All the Shareholders, etc. of a Subsidiary Company Submitting Annual Securities Reports in their own names or in another person's name, the company.
(2)If a company and a first corporation or other organization in which that company holds a majority of the Voting Rights Held by All the Shareholders, etc. in its own name or in another person's name (hereinafter such a corporation or other organization is referred to as the "controlled corporation or other organization" in this paragraph and Article 4-7), jointly hold the majority of the Voting Rights Held by All the Shareholders, etc. of a second corporation or other organization in their own names or in another person's name, the second corporation or other organization is deemed to be the controlled corporation or other organization of the company and the provisions of item (ii) of the preceding paragraph and this paragraph apply.
(Deadline for Submission of a Parent Company Status Report for a Foreign Company)
Article 4-5The period specified by Cabinet Order that is provided for in Article 24-7, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 24-7, paragraph (6) of the Act and as applied mutatis mutandis pursuant to Article 27 of the Act) is three months; provided, however, that if the Foreign Company (if applied mutatis mutandis pursuant to Article 24-7, paragraph (6) of the Act, a foreign person) that is a Parent Company, etc. (meaning a Parent Company, etc. as defined in Article 24-7, paragraph (1) of the Act; the same applies in Article 4-8) is found to be unable to submit a Parent Company, etc. Status Report (meaning the Parent Company, etc. Status Report prescribed in Article 24-7, paragraph (1) of the Act; the same applies hereinafter) within three months after the end of its business year due to the laws and regulations or practices in its state or any other compelling reasons, that period is the period approved in advance by the Commissioner of the Financial Services Agency pursuant to the provisions of Cabinet Office Order.
(Deemed Replacement of Terms in Connection with the Amendment of a Parent Company Status Report)
Article 4-6With regard to a Parent Company, etc. Status Report referred to in Article 24-7, paragraph (1) of the Act, the deemed replacement of terms under paragraph (3) of that Article when the provisions of the Act are applied mutatis mutandis pursuant to that paragraph is as given in the following table:
Provisions of the Act whose terms are deemed to be replaced
Original terms
Terms deemed to replace the original terms
Article 9, paragraph (1) of the Act
the statement or other documents set forth in Article 5, paragraph (1) and paragraph (13) or Article 7, paragraph (1)
the Parent Company, etc. Status Report or the amendment reports under Article 7
(Persons Other Than a Company That Has a Close Relationship with the Person in Question)
Article 4-7(1)The persons other than a company that has a close relationship with the person in question as specified by Cabinet Order, as provided in Article 24-7, paragraph (1) of the Act as applied mutatis mutandis pursuant to Article 24-7, paragraph (6) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act) following the deemed replacement of terms, are the following persons:
(i)a cooperative financial institution (meaning the issuer of the Securities set forth in Article 2, paragraph (1), item (vii) of the Act (including the Securities set forth in Article 2, paragraph (1), item (xvii) of the Act which have the nature of the aforementioned Securities)) that holds the majority of the Voting Rights Held by All the Shareholders, etc. of a Subsidiary Company Submitting Annual securities Reports in its own name or in another person's name, or any other person specified by Cabinet Office Order (hereinafter referred to as the "Cooperative financial institution, etc." in this Article); or
(ii)if a cooperative financial institution, etc. and the controlled corporation or other organization thereof jointly hold the majority of the Voting Rights Held by All the Shareholders, etc. of a Subsidiary Company Submitting Annual Securities Reports in their own names or in another person's name, the cooperative financial institution, etc.
(2)If a cooperative financial institution, etc. and a first controlled corporation or other organization thereof jointly hold the majority of Voting Rights Held by All the Shareholder, etc. of a second corporation or other organization in their own names or in another person's name, the second corporation or other organization is deemed to be the controlled corporation or other organization of the cooperative financial institution, etc. and the provisions of item (ii) of the preceding paragraph and this paragraph apply.
(Deemed Replacement of Terms in Connection with the Submission of a Parent Company Status Report by a Person Other Than a Company)
Article 4-8If the Parent Company, etc. referred to in Article 24-7, paragraph (1) of the Act is a person other than a company, the deemed replacement of terms under paragraph (6) of that Article when the provisions of the Act are applied mutatis mutandis pursuant to that paragraph is as given in the following table:
Provisions of the Act whose terms are deemed to be replaced
Original terms
Terms deemed to replace the original terms
Article 24-7, paragraph (1) of the Act
foreign company
foreign person
(Deemed Replacement of Terms When an Issuer Is a Person Other Than a Company)
Article 4-9If the provisions of the Act are applied mutatis mutandis to a case in which an issuer is a person other than a company as in the provisions of Article 27 of the Act, the deemed replacement of terms under that Article is as given in the following table:
Provisions of the Act whose terms are deemed to be replaced
Original terms
Terms deemed to replace the original terms
Article 13, paragraph (1) of the Act
Share option certificates
Investment Equity Subscription Right Certificates
Allotment of Share Options without Contribution specified in Article 277 of the Companies Act
allotment of Investment Equity Subscription Rights without contribution as prescribed in Article 88-13 of the Act on Investment Trusts and Investment Corporations
Article 23-3, paragraph (1) of the Act
Share option certificates
Investment Equity Subscription Right Certificates
of share options
of Investment Equity Subscription Right Certificates
Article 24, paragraph (10) of the Act
foreign company
foreign person
(Scope of Securities That Make It Unnecessary for an Issuer Other Than a Company to Submit an Annual Securities Report)
Article 4-10(1)The Securities specified by Cabinet Order that are provided for in the proviso to Article 24, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act; the same applies in the following paragraph and the following Article) are the following Securities:
(i)Preferred Equity Securities;
(ii)the Securities set forth in Article 2, paragraph (1), item (xvii) of the Act which have the nature of Preferred Equity Securities;
(iii)Certificates of a beneficial interest in a securities trust of which the Entrusted Securities are the Securities set forth in the preceding item; or
(iv)Securities as set forth in Article 2, paragraph (1), item (xx) of the Act that indicate rights associated with the Securities set forth in item (ii).
(2)The number calculated pursuant to the provisions of Cabinet Order, referred to in the proviso to Article 24, paragraph (1) of the Act, is 300.
(Amount of Stated Capital That Makes It Unnecessary for an Issuer Other Than a Company to Submit an Annual Securities Report)
Article 4-11(1)The amount specified by Cabinet Order as the amount of the stated capital, referred to in the proviso to Article 24, paragraph (1) of the Act is the amount of net assets of the incorporated educational institution, etc. stated on the balance sheet.
(2)The amount specified by Cabinet Order that is provided for in the proviso to Article 24, paragraph (1) of the Act is 100 million yen.
(3)The number specified by Cabinet Order that is provided for in the proviso to Article 24, paragraph (1) of the Act is 300.
(4)The Securities specified by Cabinet Order that are provided for in Article 24, paragraph (1), item (iv) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act; the same applies in the following paragraph) are Preferred Equity Securities and the claims set forth in Article 1-3-4.
(5)The number specified by Cabinet Order that is provided for in Article 24, paragraph (1), item (iv) of the Act is the number specified in the relevant of the following items for the category of Securities set forth in that item:
(i)Preferred Equity Securities: 1000 (if the Preferred Equity Securities are Securities for Professional Investors, the number obtained by adding the number of Professional Investors calculated pursuant to the provisions of Cabinet Office Order to 1000); or
(ii)the claims set forth in Article 1-3-4: 500.
(Issuer of Foreign Bonds for Not Required to Submit a Semiannual Securities Report)
Article 5The issuer of, among the Securities set forth in Article 2, paragraph (1), item (xvii) of the Act, the Securities which have the nature of the Securities set forth in item (i) or item (ii) of that paragraph or the issuer of, among the Securities set forth in Article 2, paragraph (1), item (xvii) of the Act, the Securities which have the nature of the Securities set forth in item (iii) of that paragraph (limited to the issuer designated by the Commissioner of the Financial Services Agency as those whose omitted submission of a Semiannual Securities Report and Extraordinary Report (meaning the Semiannual Securities Report and Extraordinary Report set forth in Article 24-5 of the Act as applied mutatis mutandis pursuant to Article 27 of the Act; hereinafter the same applies in this Article) would not compromise the public interest or the protection of investors) is not required to submit Semiannual Securities Reports and Extraordinary Reports.
Chapter III Disclosure Required for a Tender Offer
Section 1 Tender Offers for Share Certificates by Persons Other Than the Issuer
(Securities That Are Required to Be Purchased through Tender Offer)
Article 6(1)The Securities set forth in Article 27-2, paragraph (1) of the Act which are specified by Cabinet Order are the following Securities (excluding share certificates associated with shares that do not allow voting rights to be exercised with regard to all matters that can be resolved at a shareholders meeting (referred to as "Shares Not Conferring Voting Rights" in Article 14-5-2) or other Securities specified by Cabinet Office Order; hereinafter referred to as "Share Certificates, etc." in this Section):
(i)share certificates, share option certificates and corporate bond certificates with share options;
(ii)instruments or certificates issued by a foreign person which have the nature of the Securities set forth in the preceding item;
(iii)Investment Securities, etc. and Investment Equity Subscription Right Certificates, etc.;
(iv)Certificates of a beneficial interest in a securities trust of which the Entrusted Securities are the Securities set forth in the preceding three items; and
(v)Securities as set forth in Article 2, paragraph (1), item (xx) of the Act that indicate rights associated with the Securities set forth in item (i) to item (iii).
(2)The Securities specified by Cabinet Order as those for which the state of distribution can be regarded as being equivalent to the Specified Listed Securities, as provided in Article 27-2, paragraph (1) of the Act, are Specified Over-the-Counter Traded Securities.
(3)The acts specified by Cabinet Order as being similar to an acquisition for value of Share Certificates, etc., as provided in Article 27-2, paragraph (1) of the Act, are as follows:
(i)a unilateral option contract for a purchase and sale of Share Certificates, etc. (limited to cases in which the person in question holds the right to complete the purchase and sale and would acquire the position of buyer through the exercise of that right);
(ii)acquisition of an Option (meaning an Option as defined in Article 2, paragraph (1), item (xix) of the Act; the same applies hereinafter) to effect a purchase and sale of Share Certificates, etc. (limited to if the exercise of that Option would cause the person exercising it to acquire the position of buyer in the purchase and sale);
(iii)any other acts specified by Cabinet Office Order.
(Purchases Exempted from Tender Offers)
Article 6-2(1)The Purchase, etc. of Share Certificates, etc. specified by Cabinet Order that is provided for in the proviso to Article 27-2, paragraph (1) of the Act means a Purchase, etc. (meaning a Purchase, etc. as prescribed in that paragraph; hereinafter the same applies in this Section) of Share Certificates, etc. as follows:
(i)a Purchase, etc. of Share Certificates, etc. made through the exercise of the right to receive the allotment of shares by the person that holds that right;
(ii)a Purchase, etc. of Share Certificates, etc. that a person holding a beneficiary certificate of an investment trust as set forth in Article 12, item (i) of the Order for the Enforcement of the Act on Investment Trusts and Investment Corporations makes by exchanging that beneficiary certificate pursuant to Article 12, item (i), (a) of that Order;
(iii)a Purchase, etc. of Share Certificates, etc. that a person holding a beneficiary certificate of an investment trust as set forth in Article 12, item (ii) of the Order for the Enforcement of the Act on Investment Trusts and Investment Corporations makes by exchanging that beneficiary certificate pursuant to Article 12, item (ii), (c) of that Order;
(iv)a Specified Purchase, etc. (meaning a Purchase, etc. of Share Certificates, etc. as referred to in paragraph (3); hereinafter the same applies in this paragraph) of Share Certificates, etc. that are being issued by the issuer of Share Certificates, etc. which are in the possession of the person making that Specified Purchase, etc., if, before the Specified Purchase, etc., the sum rate of that person's Ownership Ratio of Share Certificates, etc. (meaning the Ownership Ratio of Share Certificates, etc. defined in Article 27-2, paragraph (8) of the Act; hereinafter the same applies in this Section) and the Ownership Ratio of Share Certificates, etc. of that person's Specially Related Parties (meaning the Specially Related Parties set forth in the proviso to Article 27-2, paragraph (1) of the Act) exceeds 50 percent (excluding cases in which the Ownership Ratio of Share Certificates, etc. for Share Certificates, etc. in the possession of the person that conducts the Specified Purchase, etc. (if there are Specially Related Parties (meaning Specially Related Parties as set forth in Article 27-2, paragraph (1), item (i) of the Act) with the person, the rate obtained by adding the Ownership Ratio of Share Certificates, etc. of those Specially Related Parties; hereinafter the same applies in this Section) is not less than two-thirds after the Specified Purchase, etc. is conducted);
(v)if a corporation or other organization that is in the position of holding shares or equity associated with a number of voting rights that constitutes over 50 percent of the number of Voting Rights Held by All the Shareholders, etc. of a corporation or other organization (excluding the cases specified by Cabinet Office Order; hereinafter referred to as a "Special Controlling Interest" in this item) (such a corporation or other organization is referred to as the "Parent Corporation, etc." in the following item), holds a Special Controlling Interest over another corporation or other organization, the Specified Purchase, etc. conducted by the other corporation or other organization;
(vi)if the person that conducts a Specified Purchase, etc. and the Parent Corporation, etc. of the person that conducts a Specified Purchase, etc. and any other person specified by Cabinet Office Order (hereinafter referred to as a "related corporation or other organization" in this item) jointly hold shares or Investment Equity (including the status as a member of a Foreign Investment Corporation (meaning a Foreign Investment Corporation as prescribed in Article 2, paragraph (25) of that Act; the same applies hereinafter); hereinafter the same applies in this Section) associated with voting rights (including voting rights associated with shares and Investment Equity (meaning the Investment Equity prescribed in Article 2, paragraph (14) of the Act on Investment Trusts and Investment Corporations; hereinafter the same applies in this Section) that cannot be asserted against the issuer pursuant to the provisions of Article 147, paragraph (1) or Article 148, paragraph (1) of the Act on the Book-Entry Transfer of Corporate Bonds, Shares, etc. (including as applied mutatis mutandis pursuant to Article 228, paragraph (1) of that Act)) exceeding one-third of the number of Voting Rights Held by All the Shareholders, etc. of another issuer, the Specified Purchase, etc. of Share Certificates, etc. of the other issuer made by the related corporation or other organization (excluding those specified by Cabinet Office Order) (excluding the Specified Purchase, etc. set forth in the preceding item);
(vii)a Specified Purchase, etc. made in a case specified by Cabinet Office Order as a case in which the holders of Share Certificates, etc. are few in number, in a case specified by Cabinet Office Order as a case in which all the holders of the Share Certificates, etc. have given consent to make the Specified Purchase, etc. associated with the Share Certificates, etc. by means other than a Tender Offer;
(viii)a Specified Purchase, etc. made through the exercise of a security interest;
(ix)a Specified Purchase, etc. made by a full or partial acquisition of business;
(x)a Purchase, etc. of Share Certificates, etc. made in response to a Secondary Distribution of Share Certificates, etc. (limited to cases in which the notification under Article 4, paragraph (1) of the Act has been given or the Supplements to Shelf Registration Documents defined in Article 23-8, paragraph (1) of the Act has been submitted under that paragraph with regard to the Secondary Distribution);
(xi)if the issuer provides, as a feature of all or part of its shares, that the shareholders may demand the issuer to redeem the shares, the Purchase, etc. of the Share Certificates, etc. which are delivered in exchange of the redemption of the shares;
(xii)if the issuer provides, as a feature of all or part of its shares, that the issuer may acquire the shares or share options upon the occurrence of a specified event, Purchase, etc. of the Share Certificates, etc. which are delivered in exchange of the acquisition of the shares or share options;
(xiii)if an Officer (meaning a director, executive officer, accounting advisor (if the accounting advisor is a corporation, the member to perform the duties thereof is included; the same applies in Article 9, paragraph (1) and Article 14-8-2, paragraph (1)), or company auditor, and in the case of an Investment Corporation (meaning an Investment Corporation as defined in Article 2, paragraph (12) of the Act on Investment Trusts and Investment Corporations and including a Foreign Investment Corporation), meaning the corporate officer, supervisory officer, or any person equivalent thereto; hereinafter the same applies in this item) or employee of the issuer of the Share Certificates, etc. entrusts the Purchase, etc. of the issuer's Share Certificates, etc. to a Financial Instruments Business Operator (limited to those that conduct Type 1 Financial Instruments Business (meaning the Type I Financial Instruments Business defined in Article 28, paragraph (1) of the Act; the same applies hereinafter); the same applies in Article 10, item (i) and Article 14-3-5, item (i)) jointly with other Officers or employees of the issuer, the Purchase, etc. of Share Certificates, etc. made if that Purchase, etc. is to be made continually according to a fixed plan and without depending on an individual investment decision, and any other case specified by Cabinet Office Order;
(xiv)the Purchase, etc. of Share Certificates, etc. which are issued by an issuer other than one that is required to submit an Annual Securities Report pursuant to Article 24, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 24, paragraph (5) of the Act (including as applied mutatis mutandis pursuant to Article 27 of the Act)) (excluding an issuer of Share Certificates, etc. which are Specified Listed Securities or Specified Over-the-Counter Traded Securities);
(xv)if a Clearing Member (meaning a Clearing Member as prescribed in Article 156-7, paragraph (2), item (iii) of the Act) that has the obligation to deliver the Share Certificates, etc. to the Financial Instruments Clearing Organization (if the Financial Instruments Clearing Organization conducts Collaborative Financial Instruments Obligation Assumption Services as prescribed in Article 156-20-16, paragraph (1), including the Collaborating Clearing Organization, etc. set forth in that paragraph; hereinafter the same applies in this item) or the Foreign Financial Instruments Clearing Organization has failed to perform that obligation by the time specified as the limit for the performance of the obligations in the business rules of the Financial Instruments Clearing Organization or Foreign Financial Instruments Clearing Organization, a Purchase, etc. of Share Certificates, etc. made pursuant to the provisions of the business rules; or
(xvi)a Purchase, etc. of Share Certificates, etc. through a Demand for a Share, etc. Cash-Out (meaning a demand for a share, etc. cash-out as prescribed in Article 179-3, paragraph (1) of the Companies Act; the same applies in Article 28-2, item (xiii), Article 29-2-5, item (vi), and Article 31) (if the issuer of Share Certificates, etc. has issued share option certificates by the time of the purchase, etc. (excluding cases in which all the share option certificates are specified by Cabinet Office Order, referred to in Article 8, paragraph (5), item (iii)), limited to cases in which the demand for a share option cash-out prescribed in Article 179, paragraph (3) of that Act is made together with the demand for a cash-out prescribed in Article 179, paragraph (2) of that Act).
(2)The transactions specified by Cabinet Order that are provided for in Article 27-2, paragraph (1), item (i) of the Act are the following transactions:
(i)transactions of Over-the-Counter Traded Securities on an Over-the-Counter Securities Market;
(ii)transactions of Securities (limited to those listed on a Financial Instruments Exchange; hereinafter the same applies in this item) through the acts set forth in Article 2, paragraph (8), item (x) of the Act (limited to those made using an electronic data processing system designated by the Commissioner of the Financial Services Agency as satisfying all of the following requirements) (if the Securities are Specified Listed Securities, those transactions are limited to those in which Professional Investors, etc. are the only parties):
(a)it has been established that the class, issue and price of the Securities subject to an solicitation for selling, an offer to purchase, or a purchase and sale that has been undertaken using an electronic data processing system, and any other particulars specified by Cabinet Office Order as particulars that should indicate the substance of the offer or of the purchase and sale, will be publicly announced immediately;
(b)the method for deciding the trading price associated with an solicitation for selling, an offer to purchase, or a purchase and sale that is undertaken using the electronic data processing system is a method that involves an auction or any other method specified by Cabinet Office Order as one that involves the price being formed with the participation of a large number of persons;
(c)it is found to have been ensured that a person holding Securities for which an offer to purchase has been made using an electronic data processing system will have the opportunity to sell those Securities using that electronic data processing system in a timely manner; and
(iii)transactions of Securities by the method of an auction on a foreign financial instruments market designated by the Commissioner of the Financial Services Agency as being equivalent to a Financial Instruments Exchange Market or by other methods specified by Cabinet Office Order as being equivalent thereto.
(3)The case specified by Cabinet Order as Purchases, etc. being made from an extremely small number of persons, as prescribed in Article 27-2, paragraph (1), item (i) of the Act, and the case specified by Cabinet Order as Purchases, etc. of Share Certificates, etc. being made from an extremely small number of persons, as prescribed in item (ii) of that paragraph, are cases in which the total number of counterparties to the Purchases, etc. of Share Certificates, etc. and counterparties to Purchases, etc. of Share Certificates, etc. that have been issued by the issuer of the relevant Share Certificates, etc. which have been made outside a Financial Instruments Exchange Market during the 60 days prior to the day on which the relevant Purchases, etc. are to be made (excluding the persons specified by Cabinet Office Order) (excluding Purchases, etc. made through a Tender Offer, Purchases, etc. of Share Certificates, etc. made through transactions as set forth in the items of the preceding paragraph (excluding Purchases, etc. in the case referred to in the following Article, paragraph (7), item (i)), any Purchase, etc. of Share Certificates, etc. that a person holding share options makes through the exercise of those share options, and Purchases, etc. as set forth in paragraph (1), items (i) to (iii) and (x) to (xv)) is less than ten persons.
(4)The transactions specified by Cabinet Order that are provided for in Article 27-2, paragraph (1), item (ii) of the Act are the transactions set forth in paragraph (2), item (i).
(Purchases to Which Restrictions on Tender Offer Are Applied)
Article 7(1)The case specified by Cabinet Order as equivalent to the possession of Share Certificates, etc. which is provided for in Article 27-2, paragraph (1), item (i) of the Act means one of the following cases:
(i)a case in which the person that conducts the Purchase, etc. has the right to request delivery of Share Certificates, etc. under a purchase and sale contract or any other contract;
(ii)a case in which the person that conducts the Purchase, etc. has the authority to exercise voting rights as a shareholder or Investor (meaning an investor as defined in Article 2, paragraph (16) of the Act on Investment Trusts and Investment Corporations and including the members of a Foreign Investment Corporation; the same applies in Article 14-6-2, item (ii)) of the issuer of Share Certificates, etc., or the authority to give instructions with regard to the exercise of voting rights under a money trust contract or any other contract, or the provisions of Acts;
(iii)a case in which the person that conducts the Purchase, etc. has the authority necessary to make investments in Share Certificates, etc. based on a Discretionary Investment Contract (meaning a discretionary investment contract as prescribed in Article 2, paragraph (8), item (xii), (b) of the Act; the same applies hereinafter) or any other contract, or the provisions of Acts;
(iv)a case in which the person that conducts the Purchase, etc. has entered into a unilateral option contract for a purchase and sale of Share Certificates, etc. (limited to cases in which the person in question holds the right to complete the purchase and sale and would acquire the position of buyer through the exercise of that right);
(v)a case in which the person that conducts the Purchase, etc. has acquired an Option to effect a purchase and sale of Share Certificates, etc. (limited to if the exercise of that Option would cause the person exercising it to acquire the position of buyer in the purchase and sale); and
(vi)any other cases specified by Cabinet Office Order.
(2)The period specified by Cabinet Order that is provided for in Article 27-2, paragraph (1), item (iv) of the Act is three months.
(3)The proportion specified by Cabinet Order related to the acquisition of Share Certificates, etc., as prescribed in Article 27-2, paragraph (1), item (iv) of the Act, is ten percent of the total number of Share Certificates, etc. issued by the issuer of the Share Certificates, etc. subject to the acquisition. In this case, the calculation of that proportion is to be made pursuant to the provisions of Cabinet Office Order based on the number of voting rights associated with the Share Certificates, etc.
(4)The proportion specified by Cabinet Order related to the Purchase, etc. of Share Certificates, etc. made through the Specified Purchase and Sale, etc. or the Purchase, etc. made outside of Financial Instruments Exchange Markets, as prescribed in Article 27-2, paragraph (1), item (iv) of the Act, is five percent of the total number of Share Certificates, etc. issued by the issuer of Share Certificates, etc. that are subject to that Purchase, etc. In this case, the calculation of that proportion is to be made pursuant to the provisions of Cabinet Office Order based on the number of voting rights associated with the Share Certificates, etc.
(5)The period specified by Cabinet Order that is provided for in Article 27-2, paragraph (1), item (v) of the Act is the period from the day of commencement of the period of Purchase, etc. of Share Certificates, etc. stated on the Tender Offer Statement (meaning a Tender Offer Statement as prescribed in Article 27-3, paragraph (2) of the Act) for a Tender Offer undertaken for the relevant Share Certificates, etc. until the day on which the period ends.
(6)The proportion specified by Cabinet Order that is provided for in Article 27-2, paragraph (1), item (v) of the Act is five percent of the total number of Share Certificates, etc. issued by the issuer of the Share Certificates, etc. subject to Purchase, etc. In this case, the calculation of that proportion is to be made pursuant to the provisions of Cabinet Office Order based on the number of voting rights associated with the Share Certificates, etc.
(7)The Purchase, etc. of Share Certificates, etc. specified by Cabinet Order that is provided for in Article 27-2, paragraph (1), item (vi) of the Act means one of the following Purchases, etc. of Share Certificates, etc.:
(i)if the Ownership Ratio of Share Certificates, etc. for Share Certificates, etc. in the possession of the Purchaser of Share Certificates, etc. (meaning the person that conducts the Purchase, etc. of Share Certificates, etc.; the same applies in the following item) is much than a-third after the Purchase, etc. of Share Certificates, etc. is conducted, the Purchase, etc. thereof which is made through a transaction as set forth in paragraph (2), items (ii) and (iii) of the preceding Article; and
(ii)if the provisions of Article 27-2, paragraph (1), item (iv) of the Act are applied to the Acquisition of Share Certificates, etc. (meaning the Purchase, etc. of Share Certificates, etc. and the Acquisition of Newly Issued Share Certificates, etc. prescribed in Article 27-2, paragraph (1), item (iv) of the Act; hereinafter the same applies in this item) made by the Purchaser of Share Certificates, etc. and to the Acquisition of Share Certificates, etc. made by the Specially Related Party thereof (meaning a Specially Related Party thereof as prescribed in Article 27-2, paragraph (7), item (ii) of the Act) by deeming the acquisition to be the Acquisition of Share Certificates, etc. made by the Purchaser of Share Certificates, etc., the Purchase, etc. of Share Certificates, etc. made as the Acquisition of Share Certificates, etc. which is to fall under the category of Purchase, etc. of Share Certificates, etc. prescribed in Article 27-2, paragraph (1), item (iv) of the Act.
(Period of Purchase)
Article 8(1)The period specified by Cabinet Order that is provided for in Article 27-2, paragraph (2) of the Act is not less than 20 days (the number of days that constitute days as set forth in the items of Article 1, paragraph (1) of the Act on Non-Business Days of Administrative Organs (Act No. 91 of 1988) (hereinafter referred to as "Non-Business Days of Administrative Organs") is not included) but within 60 days (Non-Business Days of Administrative Organs are not included) from the day on which the Tender Offeror (meaning the Tender Offeror prescribed in Article 27-3, paragraph (2) of the Act; hereinafter the same applies in this Section) has given Public Notice of the Commencement of the Tender Offer (meaning the public notice referred to in Article 27-3, paragraph (1) of the Act; hereinafter the same applies in this Section).
(2)The thing specified by Cabinet Order as being equivalent to the purchase price, as provided in Article 27-2, paragraph (3) of the Act, is the ratio of exchange between the Share Certificates, etc. and the Securities or anything other than money, if Securities or anything other than money are delivered as the consideration of the Purchase, etc.; and if money is delivered for the difference that arises in the exchange, its amount is included.
(3)If a Purchase, etc. of Share Certificates, etc. is being undertaken by means of a Tender Offer, the Price for the Purchase, etc. (meaning the price for the Purchase, etc. referred to in Article 27-2, paragraph (3) of the Act) must be the same for all tendering shareholders, etc. (meaning tendering shareholders, etc. as prescribed in Article 27-12, paragraph (1) of the Act; hereinafter the same applies in this Section); provided, however, that if the Tender Offeror allows tendering shareholders, etc. to choose two or more types of consideration, it must make the types of consideration that can be chosen the same for all the tendering shareholders, etc., and must act uniformly for each type of consideration as regards the tendering shareholders, etc. that have selected that type of consideration.
(4)The affairs specified by Cabinet Order that are provided for in Article 27-2, paragraph (4) of the Act are as follows:
(i)the retention and return of tendered Share Certificates, etc. (meaning tendered Share Certificates, etc. as prescribed in Article 27-12, paragraph (3) of the Act);
(ii)paying for the Purchase, etc. (if Securities or anything other than money are delivered as the consideration for Purchase, etc., the delivery of the Securities or anything other than money is included); and
(iii)affairs for fixing the number of Share Certificates, etc. for which Purchase, etc. is to be made by the Pro Rata Method (meaning the Pro Rata Method prescribed in Article 27-13, paragraph (5) of the Act).
(5)The conditions and methods specified by Cabinet Order that are provided for in Article 27-2, paragraph (5) of the Act are as follows:
(i)once the period of Purchase, etc. has ended, a written notice of Purchase, etc. stating the number of Share Certificates, etc. subject to the Purchase, etc. and any other particulars specified by Cabinet Office Order will be sent to the tendering shareholders, etc. without delay;
(ii)the transfer or other settlement of the Purchase, etc. will be undertaken without delay after the expiration of the period of Purchase, etc.; and
(iii)if the Ownership Ratio of Share Certificates, etc. of the person making the Purchase, etc. would aggregate to not less than two-thirds after the Purchase, etc. has been conducted, the offer to Purchase, etc. or the solicitation for selling, etc., etc. (meaning to Sell, etc. as prescribed in Article 27-2, paragraph (6) of the Act; hereinafter the same applies in this Chapter) will be made pursuant to the provisions of Cabinet Office Order with regard to all of the Share Certificates, etc. (excluding Share Certificates, etc. specified by Cabinet Office Order as those which would not compromise the public interest or the protection of investors) that are issued by the issuer of the relevant Share Certificates, etc.
(6)The person that is required to send a written notice under item (i) of the preceding paragraph may, in the case specified by Cabinet Office Order, provide a person with the particulars that are required to be stated in the written notice by means of using an electronic data processing system or any other means of information and communications technology specified by Cabinet Office Order in lieu of sending the written notice. In this case, the person that has so provided those particulars is deemed to have sent the written notice.
(Special Relationship)
Article 9(1)The special relationship specified by Cabinet Order provided for in Article 27-2, paragraph (7), item (i) of the Act is if a person making a Purchase, etc. of Share Certificates, etc. is an individual, that person's relationship with the following persons:
(i)a relative of the person (limited to the spouse thereof and the relatives by blood or affinity within the first degree of kinship; hereinafter the same applies in this Article);
(ii)if the person that conducts the Purchase, etc. of Share Certificates, etc. (inclusive of that person's relatives) is in the position of holding shares or equity associated with not less than 20 percent of the Voting Rights Held by All the Shareholders, etc. of a corporation or other organization in the person's own name or in another person's name (or under a fictitious name; hereinafter the same applies in this Article) (hereinafter such a relationship is referred to as a "Special Capital Relationship" in this Article), the corporation or other organization and its Officers (meaning a director, executive officer, accounting advisor, or company auditor (including board member, inspector, and persons equivalent thereto); hereinafter the same applies in this Article) (excluding cases in which the person will come to have a Special Capital Relationship by conducting the Purchase, etc. of the Share Certificates, etc.).
(2)The special relationship specified by Cabinet Order that is provided for in Article 27-2, paragraph (7), item (i) of the Act is, if the person that conducts the Purchase, etc. of Share Certificates, etc. is a corporation or other organization, its relationship with the following persons:
(i)that person's Officers;
(ii)if that person has a Special Capital Relationship with another corporation or other organization (excluding a case in which that person will come to have a Special Capital Relationship by conducting a Purchase, etc. of Share Certificates, etc.), the other corporation or other organization and its Officers; and
(iii)an individual that has a Special Capital Relationship with that person, a corporation or other organization that has a Special Capital Relationship with that person, or the Officer of such a corporation or other organization.
(3)If an individual (inclusive of that individuals relatives; hereinafter the same applies in this Article) and the controlled corporation or other organization thereof, or a corporation or other organization and the controlled corporation or other organization thereof jointly hold shares or equity associated with voting rights constituting not less than 20 percent of the Voting Rights Held by All the Shareholders, etc. of another corporation or other organization in their own names or in another person's name, the individual or corporation or other organization is deemed to have a Special Capital Relationship with the other corporation or other organization and the provisions of the preceding two paragraphs apply.
(4)If an individual and the controlled corporation or other organizations thereof or a corporation or other organization and the controlled corporation or other organizations thereof jointly hold shares or equity associated with voting rights constituting over 50 percent of the Voting Rights Held by All the Shareholders, etc. of another corporation or other organization in their own names or in another person's name, the other corporation or other organization is deemed to be the controlled corporation or other organization of the individual or the corporation or other organization and the provisions of the preceding paragraph apply.
(5)The controlled corporation or other organization that is referred to in the preceding two paragraphs means a second corporation or other organization in which an individual or a first corporation or other organization holds shares or equity associated with voting rights constituting more than 50 percent of the Voting Rights Held by All the Shareholders, etc. of the second corporation or other organization in its own name or in another person's name.
(Securities to Be Added in the Calculation of the Ownership Ratio of Share Certificates)
Article 9-2The Securities specified by Cabinet Order that are provided for in Article 27-2, paragraph (8), items (i) and (ii) of the Act are the following Securities:
(i)corporate bond certificates with share options;
(ii)share option certificates;
(iii)if the issuer provides, as a feature of all or part of its shares, that the shareholders may demand the issuer to redeem the shares, the share certificates of those shares;
(iv)if the issuer provides, as a feature of all or part of its shares, that the issuer may acquire its shares upon the occurrence of a specified event, the share certificates of those shares;
(v)instruments or certificates issued by a foreign person which have the nature of the Securities set forth in the preceding items; and
(vi)Investment Equity Subscription Right Certificates, etc.
(Public Notice of the Commencement of a Tender Offer)
Article 9-3(1)Public notice under Article 27-3, paragraph (1), Article 27-6, paragraph (1), Article 27-8, paragraph (11), Article 27-10, paragraph (4), Article 27-11, paragraph (2), and Article 27-13, paragraph (1) of the Act must be given by one of the following means:
(i)by taking measures to put the information that is required to be given in a public notice into a form that makes it possible for many and unspecified persons to be provided with that information by means that involves the use of an electronic data processing system for Disclosure pursuant to the provisions of Cabinet Office Order (referred to as the "Electronic Public Notice" in paragraph (3) to paragraph (5)); or
(ii)by publication in a daily newspaper that publishes information on current affairs (including daily newspapers that report on general industrial and economic matters; the same applies in item (i) of the following Article and Article 14-3-4, paragraph (1), item (ii)) pursuant to the provisions of Cabinet Office Order.
(2)Among the public notices referred to in the preceding paragraph, the public notice set forth in the main clause of Article 27-8, paragraph (11) of the Act must be given immediately after the amendment under that paragraph has been submitted.
(3)A person giving public notice by way of Electronic Public Notice pursuant to the provisions of paragraph (1) must publish an indication that it has given that public notice in a daily newspaper that publishes information on current affairs pursuant to the provisions of Cabinet Office Order without delay after having given the public notice.
(4)A person giving public notice by way of Electronic Public Notice pursuant to paragraph (1) must continue to provide the Electronic Public Notice until the day specified in the relevant of the following items for the category of public notice set forth in that item:
(i)a public notice under Article 27-3, paragraph (1), Article 27-6, paragraph (1), Article 27-8, paragraph (11), Article 27-10, paragraph (4), or Article 27-11, paragraph (2) of the Act: the last day of the Tender Offer Period; and
(ii)a public notice under Article 27-13, paragraph (1) of the Act: the final day in the one-month period after the start of the public notice.
(5)The provisions of Article 4-2-4, paragraphs (3) and (4) apply mutatis mutandis to a person that gives public notice by way of Electronic Public Notice pursuant to paragraph (1). In this case, the phrase "paragraph (1), item (ii)" in Article 4-2-4, paragraph (3) is deemed to be replaced with "Article 9-3, paragraph (1), item (ii)" and the phrase "paragraph (2)" in Article 4-2-4, paragraph (4) is deemed to be replaced with "Article 9-3, paragraph (4)".
(6)The period specified by Cabinet Order referred to in the second sentence of Article 27-3, paragraph (1) of the Act and Article 27-10, paragraph (2), item (ii) and paragraph (3) of that Article of the Act is 30 days (not counting any Non-Business Days of Administrative Organs).
(Public Announcement of the Numbers of Tendered Share Certificates)
Article 9-4The public announcement under Article 27-13, paragraph (1) of the Act must be made by disclosure to the following journalistic organizations, pursuant to the provisions of Cabinet Office Order:
(i)news publishers engaged in the sale of daily newspapers that publish information on current affairs in the course of trade;
(ii)communications agencies engaged in the comprehensive transmission of information on current affairs to the news publishers set forth in the preceding item in the course of trade; and
(iii)NHK (Japan Broadcasting Corporation) and Private Broadcasters (meaning the Private Broadcasters prescribed in Article 2, item (iii)-3 of the Broadcast Act (Act No. 132 of 1950); the same applies hereinafter).
(Persons Affiliated with a Tender Offeror)
Article 10The persons concerned specified by Cabinet Order that are provided for in Article 27-3, paragraph (3) of the Act are the following persons:
(i)a Financial Instruments Business Operator or a Bank, etc. (meaning a bank, a Cooperative Structured Financial Institution prescribed in Article 2, paragraph (1) of the Act on Preferred Equity Investment (hereinafter referred to as the "Cooperative financial institution"), or a Financial Institution set forth in the items of Article 1-9 of this Order; the same applies in Article 14-3-5, item (i)) that carries out the affairs set forth in Article 8, paragraph (4) on behalf of the Tender Offeror; or
(ii)a person that conducts the Purchase, etc. of Share Certificates, etc. by means of a Tender Offer while representing the Tender Offeror.
(Share Certificates Equivalent to Listed Share Certificates)
Article 11The Share Certificates, etc. specified by Cabinet Order that are provided for in Article 27-3, paragraph (4), item (ii) of the Act (including as applied mutatis mutandis pursuant to Article 27-8, paragraph (6) of the Act (including as applied mutatis mutandis pursuant to Article 27-13, paragraph (3) of the Act), Article 27-11, paragraph (4), and Article 27-13, paragraph (3) of the Act; hereinafter the same applies in this Article) are Share Certificates, etc. that fall under the category of Over-the-Counter Traded Securities; and the Authorized Financial Instruments Firms Association specified by Cabinet Order that is provided for in Article 27-3, paragraph (4), item (ii) of the Act is the Authorized Financial Instruments Firms Association that registers those Share Certificates, etc.
(Cases in Which a Purchase May Be Conducted by Means Other Than a Tender Offer)
Article 12The cases specified by Cabinet Order that are provided for in Article 27-5, item (iii) of the Act (including as applied mutatis mutandis pursuant to Article 27-8, paragraph (10) of the Act) are the following cases:
(i)a case in which a person as set forth in the items of Article 10 conducts the Purchase, etc. under the entrustment of a person other than the Tender Offeror or the Specially Related Party thereof (meaning a Specially Related Party as prescribed in Article 27-2, paragraph (7) of the Act; excluding a person that has notified the Commissioner of the Financial Services Agency as under Article 27-5, item (ii) of the Act; hereinafter the same applies in this Section);
(ii)a case in which a person as set forth in the items of Article 10 conducts a Purchase, etc. which is authorized for the facilitation of smooth distribution of Securities by the rules provided by a Financial Instruments Exchange or Authorized Financial Instruments Firms Association;
(iii)a case in which a person that holds share options conducts the Purchase, etc. through the exercise of those share options;
(iv)a case in which a Purchase, etc. as set forth in Article 6-2, paragraph (1), items (i) to (iii), (xi) and (xii) is to be conducted;
(v)a case in which a person as set forth in the items of Article 10 conducts the Purchase, etc. through the exercise of an Option to effect a purchase and sale of Share Certificates, etc. held thereby or due to the exercise of the Option to effect a purchase and sale of Share Certificates, etc. that the person has granted;
(vi)a case in which a Purchase, etc. set forth in Article 6-2, paragraph (1), item (xv) is to be conducted;
(vii)a case in which a Purchase, etc. is to be conducted in a foreign state where the Foreign Financial Instruments Exchange which lists the Share Certificates, etc. is located, by means of a Foreign Tender Offer (meaning an offer to Purchase, etc. or the solicitation for selling, etc., etc. Share Certificates, etc. that is made to many and unspecified persons based on the laws and regulations of a foreign state and that is similar to a Tender Offer; the same applies in Article 14-3-7, item (ii)) based on the provisions of laws and regulations of the foreign state; and
(viii)a case in which a Purchase, etc. of Share Certificates, etc. is to be conducted in response to the request for the purchase of Shares under the provisions of Article 116, paragraph (1), Article 182-4, paragraph (1), Article 192, paragraph (1), Article 469, paragraph (1), Article 785, paragraph (1), Article 797, paragraph (1), Article 806, paragraph (1) or Article 816-6, paragraph (1) of the Companies Act, or in response to the demand for the purchase of Investment Equity under the provisions of Article 141, paragraph (1), Article 149-3, paragraph (1), Article 149-8, paragraph (1) or Article 149-13, paragraph (1) of the Act on Investment Trusts and Investment Corporations.
(Prohibited Changes in the Terms of Purchase)
Article 13(1)The acts specified by Cabinet Order that are provided for in Article 27-6, paragraph (1), item (i) of the Act are as follows:
(i)the splitting of shares or Investment Equity; and
(ii)the allotment of shares or share options to shareholders (limited to those made without requiring an additional payment), or allotment of Investment Equity Subscription Rights (meaning the Investment Equity Subscription Rights as prescribed in Article 2, paragraph (17) of the Act on Investment Trusts and Investment Corporations; the same applies in Article 14, paragraph (1), item (i), (n)) to Investors (meaning the Investors as prescribed in Article 2, paragraph (16) of that Act).
(2)The changes in the Terms of Purchase, etc. specified by Cabinet Order that are provided for in Article 27-6, paragraph (1), item (iv) of the Act are as follows:
(i)if the conditions set forth in Article 27-13, paragraph (4), item (i) of the Act have been imposed, an increase in the number of Share Certificates, etc. designated in the Public Notice of the Commencement of the Tender Offer and Tender Offer Statement as prescribed in that item; provided, however, that this does not apply if a person other than the Tender Offeror, Specially Related Party thereof, or the issuer of the Share Certificates, etc. for which the Tender Offer has been commenced (hereinafter referred to as the "Subject Company" in this Section) has given a Public Notice of the Commencement of a Tender Offer or a Public Notice or Public Announcement (meaning a public notice or public announcement as referred to in Article 27-6, paragraph (2) or (3) of the Act) of the changes in the Terms of Purchase which increases the number of Share Certificates, etc. planned to be purchased, and has conducted the Tender Offer with regard to the Share Certificates, etc. issued by the Subject Company;
(ii)an extension of the period of Purchase, etc. exceeding the period specified in Article 8, paragraph (1); provided, however, that this does not apply if the period specified in the relevant of following items is to be extended for the category of cases set forth in that item:
(a)if the period of Purchase, etc. must be extended pursuant to the provisions of Article 27-8, paragraph (8) of the Act: the period to be extended pursuant to that paragraph; and
(b)if a person other than the Tender Offeror or Specially Related Party thereof has given, with regard to the Share Certificates, etc. issued by the Subject Company, Public Notice of the Commencement of the Tender Offer (including the Public Notice of the Commencement of the Tender Offer set forth in Article 27-3, paragraph (2) of the Act as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2) of the Act) or a Public Notice or Public Announcement (meaning the public notice or public announcement under Article 27-6, paragraph (2) or (3) of the Act or Article 27-8, paragraph (8) of the Act (including as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2) of the Act or Article 27-22-3, paragraph (4) of the Act)) of a change in the Terms of Purchase that extends the period of Purchase, etc., during the Tender Offer Period (meaning the Tender Offer Period as prescribed in Article 27-5 of the Act; hereinafter the same applies in this Section): a period not exceeding the number of days counted from the day following the last day of the Tender Offer Period (including the Tender Offer Period prescribed in Article 27-5 of the Act as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2) of the Act) until the last day of the Tender Offer Period given in the Public Notice of the Commencement of the Tender Offer or the Public Notice or Public Announcement of those changes;
(iii)a change in the types of consideration for Purchase, etc.; provided, however, that this does not apply if a new type of consideration is added as an option for the tendering shareholders, etc. to choose; and
(iv)if the condition set forth in Article 27-11, paragraph (1) of the Act is imposed, a change in the details of the condition.
(Period to Submit a Target Company's Position Statement)
Article 13-2(1)The period specified by Cabinet Order that is provided for in Article 27-10, paragraph (1) of the Act is ten days (not counting any Non-Business Days of Administrative Organs).
(2)The period specified by Cabinet Order that is provided for in Article 27-10, paragraph (11) of the Act is five days (not counting any Non-Business Days of Administrative Organs).
(Withdrawal of a Tender Offer)
Article 14(1)The circumstances specified by Cabinet Order that are provided for in Article 27-11, paragraph (1) of the Act are as follows; provided, however, that, with regard to circumstances set forth in item (i) to item (iii), those that satisfy the criteria specified by Cabinet Office Order as being minor are excluded:
(i)the fact that the organ which is responsible for making decisions on the execution of operations of the Subject Company or its Subsidiary (meaning a Subsidiary as prescribed in Article 2, item (iii) of the Companies Act; hereinafter the same applies in this Article and Article 14-8-2) has made a decision to undertake one of the following (limited to something that has been publicly announced after the day on which it gave the Public Notice of the Commencement of the Tender Offer):
(a)a share exchange;
(b)a share transfer;
(c)a share delivery;
(d)a company split;
(e)a merger;
(f)a dissolution (excluding the dissolution as a result of merger);
(g)the filing of a petition for commencement of bankruptcy proceedings, rehabilitation proceedings or reorganization proceedings;
(h)a reduction of the amount of stated capital;
(i)the transfer, acquisition, suspension, or discontinuation of the business in whole or in part;
(j)the filing of an application for the delisting of Share Certificates, etc. made to a Financial Instruments Exchange;
(k)the filing of an application for rescission of the registration of Share Certificates, etc. made to an Authorized Financial Instruments Firms Association;
(l)the filing of a report under Article 74, paragraph (5) of the Deposit Insurance Act;
(m)the splitting of shares or Investment Equity;
(n)the allotment of shares or share options (limited to those made without requiring an additional payment), or allotment of Investment Equity Subscription Rights;
(o)the issuance of shares, share options, corporate bonds with share options or Investment Equity (excluding those set forth in (l) and (n));
(p)the disposal of Treasury Shares (meaning the Treasury Shares prescribed in Article 113, paragraph (4) of the Companies Act) (excluding those set forth in (n));
(q)with regard to shares that have already been issued, providing different provisions on the particulars set forth in Article 108, paragraph (1), item (viii) or (ix) of the Companies Act;
(r)the disposal or transfer of important properties;
(s)borrowing in a significant amount; and
(t)anything equivalent to what is set forth in (a) to (s) which the Tender Offeror has designated in the Public Notice of the Commencement of the Tender Offer and the Tender Offer Statement (meaning the Tender Offer Statement defined in Article 27-3, paragraph (2) of the Act; hereinafter the same applies in this Article);
(ii)the fact that the organ which is responsible for making decisions on the execution of operations of the Subject Company has made the decision specified below for the category of cases set forth below, (limited to those publicly announced after the day on which the Public Notice of the Commencement of the Tender Offer was given):
(a)if the organ which is responsible for making decisions on the execution of operations of the Subject Company has already made a decision to the effect that the organ may issue new shares or conduct any other acts (limited to those conducted after the last day of the period of Purchase, etc. for that Tender Offer) that may reduce the Ownership Ratio of Share Certificates, etc. of the Tender Offeror by less than the proportion specified by Cabinet Office Order after the Tender Offer and has publicly announced the details of that decision on the day when the Public Notice of the Commencement of the Tender Offer was given: a decision to the effect that the decision is maintained; or
(b)if a Subject Company or its Subsidiary Company has issued Share Certificates, etc. for two or more classes of shares with different features which have different provisions for the particulars set forth in Article 108, paragraph (1), item (viii) or (ix) of the Companies Act on the day when the Public Notice of the Commencement of the Tender Offer was given: a decision to the effect that the different provisions are not changed;
(iii)the occurrence of the following facts in a Subject Company (limited to those that occur on or after the day on which the Public Notice of the Commencement of the Tender Offer was given); provided, however, that in cases of (a), (c), (e) and (g), cases in which the relevant acts are conducted by the Tender Offeror and the Specially Related Party thereof are excluded:
(a)a petition seeking an injunction against the business or a provisional disposition order seeking a disposition equivalent thereto has been filed;
(b)a rescission of license, suspension of business, or any other disposition equivalent thereto under laws and regulations has been given by an administrative agency;
(c)a petition for the commencement of bankruptcy proceedings, rehabilitation proceedings, reorganization proceedings, or the exercise of an enterprise mortgage (hereinafter referred to as a "Petition for Commencement of Bankruptcy Proceedings, etc.") has been filed by a person other than the Subject Company;
(d)dishonor of a negotiable instrument or check (limited to those due to the shortage of funds necessary for payment), or a disposition of the suspension of a transaction given by a clearinghouse (hereinafter referred to as "Dishonor, etc.");
(e)a suspension of transaction by the Major Trading Partner (meaning the trading partner for which the sales or purchases of the previous business year are not less than ten percent of the total amount of sales or purchases);
(f)damage resulting from a disaster;
(g)an action associated with a claim based on a property right has been filed;
(h)the delisting of share certificates (limited to the delisting from all Financial Instruments Exchanges on which the share certificates are listed);
(i)the rescission of registration of share certificates (limited to cases in which all the Authorized Financial Instruments Firms Associations which register the share certificates have rescinded the registration thereof (excluding rescissions made on the grounds of listing the share certificates)); or
(j)facts equivalent to those set forth in (a) to (i) which the Tender Offeror has designated in the Public Notice of the Commencement of the Tender Offer and the Tender Offer Statement;
(iv)if permission, authorization, approval, or anything similar thereto (hereinafter collectively referred to as "Permission, etc." in this item) from an administrative agency under other laws and regulations is necessary for the acquisition of Share Certificates, etc., the fact that the Permission, etc. was not obtained by the day immediately preceding the last day of the Tender Offer Period; and
(v)anything else specified by Cabinet Office Order as being equivalent to what is set forth in the preceding items.
(2)The changes in important circumstances specified by Cabinet Order that are provided for in Article 27-11, paragraph (1) of the Act are the following particulars:
(i)death;
(ii)being subject to an order for commencement of guardianship;
(iii)a dissolution;
(iv)being subject to a ruling for the commencement of bankruptcy proceedings, rehabilitation proceedings, or reorganization proceedings;
(v)a Petition for Commencement of Bankruptcy Proceedings, etc. has been filed by a person other than the Tender Offeror or the Specially Related Party thereof; or
(vi)the fact of Dishonor, etc.
(Means for Cancellation of Contracts)
Article 14-2The means specified by Cabinet Order that is provided for in Article 27-12, paragraph (2) of the Act is any means of delivering or sending a document cancelling the contract connected with a Tender Offer to the person designated by the Tender Offeror (limited to the persons specified by Cabinet Office Order); and the time specified by Cabinet Order that is provided for in Article 27-12, paragraph (2) of the Act is the time when the document has been delivered to or has reached the designated person.
(Cases in Which a Partial Tender Offer Is Allowed)
Article 14-2-2The rate specified by Cabinet Order that is provided for in Article 27-13, paragraph (4) of the Act is two-thirds.
(Authorized Financial Instruments Firms Associations Providing Public Inspection)
Article 14-3The Authorized Financial Instruments Firms Association specified by Cabinet Order that is provided for in Article 27-14, paragraph (3) of the Act is an Authorized Financial Instruments Firms Association stipulated in Article 11.
Section 2 Tender Offers for Listed Share Certificates by the Issuer
(Scope of Application of a Tender Offer)
Article 14-3-2(1)The transactions specified by Cabinet Order that are provided for in Article 27-22-2, paragraph (1) of the Act are the transactions of Over-the-Counter Traded Securities in an Over-the-Counter Securities Market.
(2)The provisions of other laws and regulations to be specified by Cabinet Order that are provided for in Article 27-22-2, paragraph (1), item (i) of the Act are the provisions of Article 80-2, paragraph (1) of the Act on Investment Trusts and Investment Corporations (including as applied pursuant to the provisions of Article 80-5, paragraph (2) of that Act following the deemed replacement of terms).
(3)The Purchase, etc. (meaning a Purchase, etc. as prescribed in Article 27-22-2, paragraph (1) of the Act; hereinafter the same applies in this Section) specified by Cabinet Order as one that is effected by a method that makes the particulars of that Purchase, etc. available to a large number of persons, as provided in Article 27-22-2, paragraph (1), item (ii) of the Act, means a Purchase, etc. that a person conducts after informing a large number of persons of the particulars of that Purchase, etc. (limited to those which include the wording that an offer to Purchase, etc. or solicitation for selling, etc., etc. of Listed Share Certificates, etc. (meaning the Listed Share Certificates, etc. set forth in Article 24-6, paragraph (1) of the Act; hereinafter the same applies in this Section) being conducted in connection with the Purchase, etc.) through publication in a newspaper or magazine, or using documents, broadcasts, movies, or any other method.
(Period of Purchase)
Article 14-3-3(1)The period specified by Cabinet Order that is provided for in Article 27-2, paragraph (2) of the Act as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2) of the Act is not less than 20 days (not counting any Non-Business Days of Administrative Organs) but within 60 days (not counting any Non-Business Days of Administrative Organs) from the day on which the Tender Offeror (meaning the Tender Offeror prescribed in Article 27-3, paragraph (2) of the Act as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2) of the Act; hereinafter the same applies in this Section) has given the Public Notice of the Commencement of the Tender Offer (meaning the public notice set forth in Article 27-3, paragraph (1) of the Act as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2) of the Act; hereinafter the same applies in this Section except in Article 14-3-8, item (i), (b)).
(2)The thing specified by Cabinet Order as being equivalent to the purchase price, as provided in Article 27-2, paragraph (3) of the Act as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2) of the Act, is the ratio of exchange between the Share Certificates, etc. and the Securities or anything other than money if Securities or anything other than money are delivered as the consideration of the Purchase, etc.; and if money is delivered for the difference that arises in the exchange, its amount is included.
(3)If a Purchase, etc. of Listed Share Certificates, etc. is undertaken by means of a Tender Offer as set forth in the main clause of Article 27-22-2, paragraph (1) of the Act (hereinafter referred to as the "Tender Offer" in this Section), the Price for the Purchase, etc. (meaning the price for the Purchase, etc. referred to in Article 27-2, paragraph (3) of the Act as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2) of the Act; hereinafter the same applies in this Section) must be the same for all tendering shareholders, etc. (meaning an tendering shareholder, etc. as prescribed in Article 27-12, paragraph (1) of the Act, as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2) of the Act; hereinafter the same applies in this Section); provided, however, that if the Tender Offeror allows tendering shareholders, etc. to choose two or more types of consideration, it must make the types of consideration that can be chosen the same for all the tendering shareholders, etc., and must act uniformly for each type of consideration as regards the tendering shareholders, etc. that have selected that type of consideration.
(4)The affairs specified by Cabinet Order that are provided for in Article 27-2, paragraph (4) of the Act as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2) of the Act are as follows:
(i)the retention and refund of listed Share Certificates, etc. tendered (meaning the listed Share Certificates, etc. tendered as prescribed in Article 27-12, paragraph (3) of the Act as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2) of the Act following the deemed replacement of terms);
(ii)the payment for the Purchase, etc. (if Securities or anything other than money are delivered as the consideration for Purchase, etc., the delivery of the Securities or anything other than money is included); and
(iii)affairs to fix the number of Listed Share Certificates, etc. for which Purchase, etc. is to be made by the Pro Rata Method (meaning the Pro Rata Method prescribed in Article 27-13, paragraph (5) of the Act as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2) of the Act).
(5)The conditions and methods specified by Cabinet Order that are provided for in Article 27-2, paragraph (5) of the Act as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2) of the Act are as follows:
(i)when the period of Purchase, etc. has ended, the written notice of Purchase, etc. containing the number of Listed Share Certificates, etc. for which Purchase, etc. is to be made, and any other particulars specified by Cabinet Office Order, will be sent to the tendering shareholders, etc. without delay; and
(ii)the transfer or other settlement of the Purchase, etc. will be undertaken without delay after the expiration of the period of Purchase, etc.
(6)The person that is required to send the written notice under item (i) of the preceding paragraph may, in the cases specified by Cabinet Office Order, provide the relevant person with the particulars that are required to be stated in the written notice by a means that involves the use of an electronic data processing system or any other means of information and communications technology specified by Cabinet Office Order in lieu of sending the written notice. In this case, the person that has so provided those particulars is deemed to have sent the written notice.
(Public Notice of the Commencement of a Tender Offer)
Article 14-3-4(1)Public notices under the provisions of Article 27-3, paragraph (1), Article 27-6, paragraph (2), Article 27-8, paragraph (11), Article 27-11, paragraph (2), and Article 27-13, paragraph (1) of the Act as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2) of the Act must be given by one of the following means:
(i)by taking measures to put the information that is required to be given in a public notice into a form that makes it possible for many and unspecified persons to be provided with that information by a means that involves the use of an electronic data processing system for disclosure pursuant to the provisions of Cabinet Office Order (referred to as the "Electronic Public Notice" in paragraph (3) to paragraph (5)); or
(ii)by publication in a daily newspaper that publishes information on current affairs pursuant to the provisions of Cabinet Office Order.
(2)Among the public notices referred to in the preceding paragraph, the public notice set forth in the main clause of Article 27-8, paragraph (11) of the Act as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2) of the Act must be given immediately after the amendment under Article 27-8, paragraph (11) of the Act has been submitted.
(3)A person giving public notice by way of Electronic Public Notice pursuant to the provisions of paragraph (1) must publish an indication that it has given that public notice in a daily newspaper that publishes information on current affairs pursuant to the provisions of Cabinet Office Order without delay after having given that public notice.
(4)A person giving public notice by way of Electronic Public Notice pursuant to paragraph (1) must continue to provide the Electronic Public Notice until the day specified in the relevant of the following items for the category of public notice set forth in that item:
(i)a public notice under the provisions of Article 27-3, paragraph (1), Article 27-6, paragraph (2), Article 27-8, paragraph (11), or Article 27-11, paragraph (2) of the Act as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2) of the Act: the last day of the Tender Offer Period; and
(ii)a public notice under Article 27-13, paragraph (1) of the Act as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2) of the Act: the day on which one month has elapsed from the publication of the public notice.
(5)The provisions of Article 4-2-4, paragraphs (3) and (4) apply mutatis mutandis to a person that gives the public notice by way of Electronic Public Notice pursuant to paragraph (1). In this case, the phrase "paragraph (1), item (ii)" in Article 4-2-4, paragraph (3) is deemed to be replaced with "Article 14-3-4, paragraph (1), item (ii)" and the phrase "paragraph (2)" in Article 4-2-4, paragraph (4) is deemed to be replaced with "Article 14-3-4, paragraph (4)".
(6)The provisions of Article 9-4 apply mutatis mutandis to the public announcement under Article 27-13, paragraph (1) of the Act as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2) of the Act.
(Person Affiliated with a Tender Offeror)
Article 14-3-5The persons concerned specified by Cabinet Order that are provided for in Article 27-3, paragraph (3) of the Act as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2) of the Act are the following persons:
(i)a Financial Instruments Business Operator or a Bank, etc. that carries out the affairs set forth in Article 14-3-3, paragraph (4) on behalf of the Tender Offeror; or
(ii)a person that conducts the Purchase, etc. of Share Certificates, etc. by means of a Tender Offer while representing the Tender Offeror.
(Share Certificates Equivalent to Listed Share Certificates)
Article 14-3-6The Share Certificates, etc. specified by Cabinet Order that are provided for in Article 27-3, paragraph (4), item (ii) of the Act as applied mutatis mutandis pursuant to Article 27-22-2, paragraphs (2) and (3) of the Act are the Share Certificates, etc. that fall under the category of Over-the-Counter Traded Securities; and the Authorized Financial Instruments Firms Association specified by Cabinet Order that is provided for in Article 27-3, paragraph (4), item (ii) of the Act is the Authorized Financial Instruments Firms Association that registers the Share Certificates, etc.
(Cases in Which a Purchase May Be Made by Means Other Than a Tender Offer)
Article 14-3-7The cases specified by Cabinet Order that are provided for in Article 27-5 of the Act as applied mutatis mutandis pursuant to Article 27-22-2, paragraphs (2) and (5) and Article 27-22-3, paragraph (5) of the Act following the deemed replacement of terms are the following cases:
(i)a case in which a Purchase, etc. of Share Certificates, etc. is to be made in response to a request for the purchase of Shares under Article 116, paragraph (1), Article 182-4, paragraph (1), Article 469, paragraph (1), Article 785, paragraph (1), Article 797, paragraph (1) Article 806, paragraph (1) or Article 816-6, paragraph (1) of the Companies Act or a demand for the purchase of Investment Equity under Article 141, paragraph (1), Article 149-3, paragraph (1), Article 149-8, paragraph (1) or Article 149-13, paragraph (1) of the Act on Investment Trusts and Investment Corporations, or based on the obligations under laws and regulations;
(ii)a case in which a Purchase, etc. is to be conducted in a foreign state where the Foreign Financial Instruments Exchange which lists the Share Certificates, etc. is located, by means of a Foreign Tender Offer under the provisions of laws and regulations of the foreign state;
(iii)a case in which a person as set forth in the items of Article 14-3-5 conducts a Purchase, etc. set forth in Article 12, items (iii) and (iv);
(iv)a case in which a person as set forth in the items of Article 14-3-5 conducts the Purchase, etc. under the entrustment of a person other than the Tender Offeror;
(v)a case in which a person as set forth in the items of Article 14-3-5 conducts the Purchase, etc. which is authorized for the facilitation of smooth distribution of Securities by the rules provided by a Financial Instruments Exchange or Authorized Financial Instruments Firms Association; and
(vi)a case in which a person as set forth in one of the items of Article 14-3-5 conducts a Purchase, etc. through the exercise of an Option to effect a purchase and sale of the Listed Share Certificates, etc. held thereby or due to the exercise of an Option to effect a purchase and sale of Listed Share Certificates, etc. that the person has granted.
(Prohibited Changes in the Terms of Purchase)
Article 14-3-8The changes in the Terms of Purchase, etc. specified by Cabinet Order that are provided for in Article 27-6, paragraph (1), item (iv) of the Act as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2) of the Act are as follows:
(i)an extension of the period of Purchase, etc. exceeding the period specified in Article 14-3-3, paragraph (1); provided, however, that this does not apply if the period specified in the relevant of the following items is to be extended in the case set forth in that item:
(a)if the period of Purchase, etc. must be extended pursuant to the provisions of Article 27-8, paragraph (8) of the Act as applied mutatis mutandis pursuant to the provisions of Article 27-22-2, paragraph (2) and Article 27-22-3, paragraph (4) of the Act: the period to be extended pursuant to Article 27-8, paragraph (8) of the Act; and
(b)if a person other than the Tender Offeror has given, with regard to the Share Certificates, etc. issued by the Tender Offeror, a Public Notice of the Commencement of a Tender Offer (meaning the public notice set forth in Article 27-3, paragraph (1) of the Act) or a Public Notice or Public Announcement (meaning the public notice or public announcement under Article 27-6, paragraph (2) or (3) of the Act or Article 27-8, paragraph (8) of the Act) of the changes in the Terms of Purchase which extend the period of Purchase, etc. during the Tender Offer Period (meaning the Tender Offer Period prescribed in Article 27-5 of the Act as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2) of the Act): a period not exceeding the number of days counted from the day following the last day of the Tender Offer Period until the last day of the Tender Offer Period (meaning the Tender Offer Period set forth in Article 27-5 of the Act) given in the Public Notice of the Commencement of the Tender Offer or the Public Notice or Public Announcement of the changes;
(ii)a change in the types of consideration for Purchase, etc.; provided, however, that this does not apply if a new type of consideration is added as an option for the tendering shareholders, etc. to choose; and
(iii)if the terms set forth in Article 27-11, paragraph (1) of the Act as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2) of the Act are imposed, a change in the details of the terms.
(Means for Cancellation of Contracts)
Article 14-3-9The means specified by Cabinet Order that is provided for in Article 27-12, paragraph (2) of the Act as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2) of the Act is any means of delivering or sending a document cancelling the contract connected with a Tender Offer to the person designated by the Tender Offeror (limited to the persons specified by Cabinet Office Order); and the time specified by Cabinet Order that is provided for in Article 27-12, paragraph (2) of the Act is the time when the document has been delivered to or has reached the designated person.
(Authorized Financial Instruments Firms Associations Providing Public Inspection)
Article 14-3-10The Authorized Financial Instruments Firms Association specified by Cabinet Order that is provided for in Article 27-14, paragraph (3) of the Act as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2) of the Act is an Authorized Financial Instruments Firms Association stipulated in Article 14-3-6.
(Deemed Replacement of Terms in Connection with a Tender Offer for Listed Share Certificates by the Issuer)
Article 14-3-11(1)If a Purchase, etc. by means of a Tender Offer is made pursuant to Article 27-22-2, paragraph (1) of the Act, the deemed replacement of terms under paragraph (13) of that Article when the provisions of the Act are applied mutatis mutandis pursuant to paragraph (2) of that Article is as given in the following table:
Provisions of the Act whose terms are deemed to be replaced
Original terms
Terms deemed to replace the original terms
Article 27-2 (limited to paragraph (2) to paragraph (6))
Article 27-12, paragraph (3)
Article 27-12, paragraph (3) as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2)
provisions of this Section
provisions of the following Section
Article 27-4
paragraph (2) of the preceding Article
paragraph (2) of the preceding Article as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2)
Article 27-7
paragraph (2) or (3) of the preceding Article
paragraph (1) or (2) of the preceding Article as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2)
paragraph (8) of the following Article
paragraph (8) of the following Article as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2)
Article 27-8 (excluding paragraph (6), paragraph (10), and paragraph (12))
the provisions of this Section
the provisions of the following Section
Article 27-6, paragraph (1)
Article 27-6, paragraph (1) as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2)
Article 27-6, paragraph (2)
Article 27-6, paragraph (2) as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2)
Article 27-9
the provisions of paragraphs (1) to (4) of the preceding Article
the provisions of paragraphs (1) to (4) of the preceding Article as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2)
Article 27-12
Article 27-8, paragraph (8)
Article 27-8, paragraph (8) as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2)
paragraphs (1) and (4) of the following Article, 27-14, paragraph (1) and Article 27-21, paragraphs (1) and (2)
the provisions of paragraphs (1) and (4) of the following Article, 27-14, paragraph (1) and Article 27-21, paragraph (1) as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2)
Article 27-13 (excluding paragraph (3))
Article 27-11, paragraph (2)
Article 27-11, paragraph (2) as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2)
the proviso to Article 27-11, paragraph (1)
the proviso to Article 27-11, paragraph (1) as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2)
Article 27-6, paragraph (2)
Article 27-6, paragraph (2) as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2)
Article 27-14
paragraph (1) of the following Article
paragraph (1) of the following Article as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2)
Article 27-3, paragraph (4) (including the cases where it is applied mutatis mutandis pursuant to Articles 27-8, paragraph (6), 27-11, paragraph (4) and paragraph (3) of the preceding Article)
Article 27-3, paragraph (4) as applied mutatis mutandis pursuant to Article 27-22-2, paragraphs (2) and (3) and Article 27-22-2, paragraph (4) (including the cases where it is applied mutatis mutandis pursuant to paragraph (8) of that Article)
Article 27-17
Article 27-5 (including the cases where it is applied mutatis mutandis pursuant to Article 27-8, paragraph (10); hereinafter the same applies in this paragraph)
Article 27-5 as applied mutatis mutandis pursuant to Article 27-22-2, paragraphs (2) and (5)
Article 27-5
Article 27-5 as applied mutatis mutandis pursuant to Article 27-22-2, paragraphs (2) and (5)
paragraph (2), item (i) of the following Article
paragraph (2), item (i) of the following Article as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2)
Article 27-6, paragraph (2) or (3)
Article 27-6, paragraph (2) or (3) as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2)
paragraph (2) of the following Article and Article 27-20, paragraph (2)
paragraph (2) of the following Article as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2)
Article 27-18
Article 27-13, paragraph (4)
Article 27-13, paragraph (4) as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2)
paragraph (1) of the preceding Article
paragraph (1) of the preceding Article as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2)
Article 27-21, paragraph (1)
Article 27-17, paragraph (1)
Article 27-17, paragraph (1) as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2)
Article 27-18, paragraph (2)
Article 27-18, paragraph (2) as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2)
(2)With regard to a Public Notice or Public Announcement given under the provisions of Article 27-8, paragraphs (8) and (11) of the Act as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2) of the Act, the deemed replacement of terms under Article 27-22-2, paragraph (13) of the Act when the provisions of the Act are applied mutatis mutandis pursuant to Article 27-22-2, paragraph (6) of the Act is as given in the following table:
Provisions of the Act whose terms are deemed to be replaced
Original terms
Terms deemed to replace the original terms
Article 27-7
paragraph (8) of the following Article
paragraph (8) of the following Article as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2)
(3)With regard to the Tender Offer Report defined in Article 27-13, paragraph (2) of the Act as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2) of the Act, the deemed replacement of terms under Article 27-22-2, paragraph (13) of the Act when the provisions of the Act are applied mutatis mutandis pursuant to Article 27-22-2, paragraph (7) of the Act is as given in the following table:
Provisions of the Act whose terms are deemed to be replaced
Original terms
Terms deemed to replace the original terms
Article 27-8 (limited to paragraph (1) to paragraph (5))
(including the period to be extended under paragraph (8); the same applies in paragraph (7))
(including the period to be extended under paragraph (8))
(Transitional Period After Publication)
Article 14-3-12The period specified by Cabinet Order that is provided for in Article 27-22-3, paragraph (3) of the Act is 12 hours.
(Deemed Replacement of Terms in Connection with the Publication of Material Facts Concerning a Company That Is a Tender Offeror)
Article 14-3-13If a Purchase, etc. of Listed Share Certificates, etc. has been made in violation of Article 27-5 of the Act as applied mutatis mutandis pursuant to Article 27-22-3, paragraph (5) of the Act, the deemed replacement of terms under Article 27-22-3, paragraph (8) of the Act when the provisions of the Act are applied mutatis mutandis pursuant to Article 27-22-3, paragraph (8) of the Act is as given in the following table:
Provisions of the Act whose terms are deemed to be replaced
Original terms
Terms deemed to replace the original terms
Article 27-17
Article 27-5
Article 27-5 as applied mutatis mutandis pursuant to Article 27-22-3, paragraph (5)
paragraph (2), item (i) of the following Article
paragraph (2), item (i) of the following Article as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2)
Article 27-6, paragraph (2) or (3)
Article 27-6, paragraph (2) or (3) as applied mutatis mutandis pursuant to Article 27-22-2, paragraph (2)
(excluding those which the person cannot make Sales, etc. of as a result of the Method of Proportional Distribution; the same applies in paragraph (2) of the following Article and Article 27-20, paragraph (2))
(excluding those for which the person cannot make Sales, etc. as a result of the Method of Proportional Distribution)
Chapter III-2 Disclosure of Status of Large Volume Holdings in Share Certificates
(Scope of Share-Related Securities)
Article 14-4(1)The share certificates, corporate bond certificates with share options, and other Securities specified by Cabinet Order that are provided for in Article 27-23, paragraph (1) of the Act are the following Securities:
(i)share certificates, share option certificates, and corporate bond certificates with share options;
(ii)instruments or certificates issued by a foreign person which have the nature of the Securities set forth in the preceding item;
(iii)Investment Securities, etc. or Investment Equity Subscription Right Certificates, etc.;
(iv)Certificates of a beneficial interest in a securities trust of which the Entrusted Securities are the Securities set forth in the preceding three items; and
(v)Securities as set forth in Article 2, paragraph (1), item (xx) of the Act that indicate rights associated with the Securities set forth in item (i) to item (iii).
(2)The Share-related Securities specified by Cabinet Order as those for which the state of distribution can be regarded as being equivalent to those listed on a Financial Instruments Exchange, referred to in Article 27-13, paragraph (1) of the Act, are Over-the-Counter Traded Securities.
(Scope of Securities That Indicate Rights Associated with Subject Securities)
Article 14-4-2The other Securities specified by Cabinet Order as indicating rights associated with Subject Securities, as provided in Article 27-23, paragraph (1) of the Act, are as follows:
(i)the Securities set forth in Article 2, paragraph (1), item (xix) of the Act that indicate an Option to effect a purchase and sale of Subject Securities (meaning Subject Securities as defined in Article 27-23, paragraph (2) of the Act; hereinafter the same applies in this Article) (limited to if the exercise of that Option would cause the person exercising it to acquire the position of buyer in the purchase and sale);
(ii)Certificates of a beneficial interest in a securities trust of which the Entrusted Securities are Subject Securities;
(iii)Securities as set forth in Article 2, paragraph (1), item (xx) of the Act that indicate rights associated with Subject Securities;
(iv)corporate bond certificates (excluding corporate bond certificates with share options) with a special provision that allows the redemption of the bond certificates through the Subject Securities (limited to Subject Securities issued by a company other than the company issuing the corporate bond certificates) (limited to those in connection with which the person holding the corporate bond certificates has the right to have the issuer company of the corporate bond certificates redeem the corporate bond certificates through Subject Securities); and
(v)the Securities set forth in Article 2, paragraph (1), item (xvii) of the Act which have the nature of the Securities referred to in the preceding item.
(Non-Business Days Not Included in the Reporting Period)
Article 14-5The non-business days specified by Cabinet Order that are provided for in Article 27-23, paragraph (1) of the Act are the Non-Business Days of Administrative Organs (excluding Sundays).
(Scope of Subject Securities)
Article 14-5-2The other Securities specified by Cabinet Order that are provided for in Article 27-23, paragraph (2) of the Act are as follows:
(i)share certificates (excluding the share certificates associated with what is specified by Cabinet Office Order as a Share Not Conferring Voting Rights);
(ii)share option certificates and corporate bond certificates with share options (excluding those that grant only the right to acquire Shares Not Conferring Voting Rights as the share option);
(iii)instruments or certificates issued by a foreign person which have the nature of the Securities set forth in the preceding two items;
(iv)Investment Securities, etc.; and
(v)Investment Equity Subscription Right Certificates, etc.
(Persons Equivalent to the Person with the Right to Request Delivery of Share Certificates)
Article 14-6The person specified by Cabinet Order that is provided for in Article 27-23, paragraph (3) of the Act is any of the following persons:
(i)a person that has entered into a unilateral option contract for a purchase and sale of Share Certificates, etc. (meaning Share Certificates, etc. as prescribed in Article 27-23, paragraph (1) of the Act; hereinafter the same applies in this Chapter) (limited to cases in which the person holds the right to complete the purchase and sale and would acquire the position of buyer through the exercise of that right); and
(ii)a person that has acquired the Option to effect a purchase and sale of Share Certificates, etc. (limited to cases in which the Option is indicated on a Security as set forth in Article 14-4-2, item (i)) (limited to if the exercise of that Option would cause the person exercising it to acquire the position of buyer in the purchase and sale).
(Exceptions of Share Certificates Held)
Article 14-6-2The rights specified by Cabinet Order that are provided for in Article 27-23, paragraph (4) of the Act are the following rights:
(i)the right to request delivery of Share Certificates, etc. under a purchase and sale contract or any other contract;
(ii)the right to exercise voting rights as a shareholder or Investor of the issuer of Share Certificates, etc. or the right to give instructions with regard to the exercise of voting rights under a money trust contract or any other contract, or the provisions of Acts;
(iii)the necessary rights to make investments in Share Certificates, etc. based on a Discretionary Investment Contract or any other contracts, or the provisions of Acts;
(iv)the right, based on a unilateral option contract for a purchase and sale of Share Certificates, etc., to complete that purchase and sale and acquire the position of buyer; and
(v)the right of a person exercising the Option to effect a purchase and sale of Share Certificates, etc. to acquire the position of buyer in the purchase and sale through the exercise of that Option.
(Special Relationship)
Article 14-7(1)The special relationship specified by Cabinet Order that is provided for in Article 27-23, paragraph (6) of the Act means one of the following relationships:
(i)the relationship of husband and wife;
(ii)the relationship between a person that holds shares or equity associated with voting rights that constitute over 50 percent of the Voting Rights Held by All the Shareholders, etc. of a company in the person's own name or in another person's name (or under a fictitious name; hereinafter the same applies in this Article) (hereinafter such a person is referred to as a "Controlling Shareholder, etc." in this Article) and that company (hereinafter referred to as the "Controlled Company" in this Article);
(iii)the relationship between one Controlled Company and another Controlled Company with the same Controlling Shareholder, etc.; and
(iv)any other relationship specified by Cabinet Office Order as being equivalent to the relationships set forth in the preceding three items.
(2)If a husband and wife jointly hold shares or equity associated with voting rights constituting over 50 percent of the Voting Rights Held by All the Shareholders, etc. of a company in their own names or in another person's name, the husband and wife are each deemed to be the Controlling Shareholder, etc. of the company, and the provisions of the preceding paragraph apply.
(3)If a Controlling Shareholder, etc. and the Controlled Company thereof jointly hold shares or equity associated with voting rights that constitute over 50 percent of the Voting Rights Held by All the Shareholders, etc. of another company in their own names or in another person's name, the other company is also deemed to be the Controlled Company of the Controlling Shareholder, etc. and the provisions of paragraph (1) and this paragraph apply.
(Changes in Material Particulars That Are Required to Be Stated in a Statement of Large Volume Holdings)
Article 14-7-2(1)The other cases specified by Cabinet Order as a change in a material particular that is required to be stated in a Statement of Large-Volume Holdings, referred to in the provisions of Article 27-25, paragraph (1) and Article 27-26, paragraph (2), items (i) and (ii) of the Act are, among the changes in the details to be contained in the Statement of Large-Volume Holdings or Statement of Changes (including the Amendment Reports thereof), changes other than those set forth in the following items:
(i)the fact that a holder whose Ratio of Share Certificates, etc. Held Singly is less than one percent has become a new Joint Holder (meaning the Joint Holder prescribed in Article 27-23, paragraph (5) of the Act and including the person deemed to be a Joint Holder under paragraph (6) of that Article; hereinafter the same applies in this Chapter);
(ii)the fact that a holder whose Ratio of Share Certificates, etc. Held Singly was less than one percent has ceased to be a Joint Holder;
(iii)changes in the name, address, or location of a Joint Holder whose Ratio of Share Certificates, etc. Held Singly is less than one percent;
(iv)increases or reductions in the Ratio of Share Certificates, etc. Held Singly of less than one percent;
(v)conclusion of the following contracts involving the Share Certificates, etc. held by a holder of Share Certificates, etc. and by a Joint Holder thereof, or among the changes in the contents of those contracts, those which are specified by Cabinet Office Order as being minor changes:
(a)contracts for providing the Share Certificates, etc. as a collateral;
(b)contracts for reselling;
(c)a unilateral option contract for a purchase and sale (limited to cases in which the person in question holds the right to complete the purchase and sale and would acquire the position of seller through the exercise of that right);
(d)contracts for lending and borrowing; and
(e)contracts equivalent to the contracts set forth in (a) to (d); and
(vi)anything else specified by Cabinet Office Order as being equivalent to what is set forth in the preceding items.
(2)The term "Ratio of Share Certificates, etc. Held Singly" referred to in the preceding paragraph means the ratio obtained by dividing the number of Share Certificates, etc. Held (meaning the Share Certificates, etc. Held set forth in Article 27-23, paragraph (4) of the Act) by the number obtained by adding the number of corporate bond certificates with share options and any other Securities specified by Cabinet Office Order held by the holder and the Joint Holder thereof to the total number of the Issued Shares or the Issued Investment Equity of the issuer of the Share Certificates, etc.
(Criteria for Transfer of a Large Number of Share Certificates in a Short Period)
Article 14-8(1)The criteria specified by Cabinet Order that are provided for in Article 27-25, paragraph (2) of the Act are that the Holding Ratio of Share Certificates, etc. (meaning the Holding Ratio of Share Certificates, etc. prescribed in Article 27-23, paragraph (4) of the Act; hereinafter the same applies in this Article) after the change which is required to be stated in the Statement of Changes referred to in Article 27-25, paragraph (2) of the Act comes to be less than half of the highest Holding Ratio of Share Certificates, etc. (limited to those for which the calculation is based on the day on or after the day 60 days prior to the day on which calculation of the Holding Ratio of Share Certificates, etc. after the change has been based, and those for which the calculation is based on or before the day immediately preceding the day 60 days prior to the day on which calculation of the Holding Ratio of Share Certificates, etc. after the change has been based which is the nearest to the day 60 days prior to the day on which calculation of the Holding Ratio of Share Certificates, etc. after the change has been based) which has been stated or is required to have been stated in the Statements of Large-Volume Holdings (meaning the Statements of Large-Volume Holdings set forth in Article 27-23, paragraph (1) or Article 27-26, paragraph (1) of the Act) related to the Statement of Changes or in another Statement of Changes (meaning the Statement of Changes set forth in Article 27-25, paragraph (1) or Article 27-26, paragraph (2) of the Act) related to the Statements of Large-Volume Holdings, and has decreased by more than five percent in comparison with the highest Holding Ratio of Share Certificates, etc.; provided, however, that this does not apply if the total Holding Ratio of Share Certificates, etc. that has decreased as a result of the fact that a person that is to submit a Statement of Changes due to a decrease in the Holding Ratio of Share Certificates, etc. or a Joint Holder thereof has transferred Share Certificates. etc. during the 60 days prior to the day on which calculation of the Holding Ratio of Share Certificates, etc. after the change has been based (referred to as the "Period Subject to a Report of Short-Term, Large-Volume Transfer" in the following paragraph) in a volume not more than half of the highest Holding Ratio of Share Certificates, etc. or not more than five percent.
(2)The person specified by Cabinet Order that is provided for in Article 27-25, paragraph (2) of the Act is to be, if deeming the total number of Share Certificates, etc. transferred by the person that is to submit a Statement of Changes due to a decrease in the Holding Ratio of Share Certificates, etc. or a Joint Holder thereof during the Period Subject to a Report of Short-Term, Large-Volume Transfer to be the person making the submission with the total number of Share Certificates, etc. held by that person making the submission (meaning the total number of Share Certificates, etc. prescribed in Article 27-23, paragraph (4) of the Act), the person making the submission with a Holding Ratio of Share Certificates, etc. of less than one percent.
(Material Proposal)
Article 14-8-2(1)The acts specified by Cabinet Order as effecting material changes in or having a material effect on the business activities of the issuer of Share Certificates, etc., referred to in Article 27-26, paragraph (1) of the Act, are the acts in which the following matters related to the issuer or its Subsidiary are suggested at a shareholders meeting or investors' meeting, or to the Officers (meaning a member, director, executive officer, accounting advisor, company auditor, or persons equivalent thereto that execute the operations and including those that are found to have at least the same authority as a member, director, executive officer, or any equivalent persons that execute the operations of the corporation, irrespective of their titles, such as advisor, consultant, or others; the same applies in item (iv)); provided, however, that those that satisfy the criteria specified by Cabinet Office Order as being minor are excluded:
(i)the disposal or acquisition of important properties;
(ii)borrowing in a significant amount;
(iii)selection or removal of a representative director;
(iv)important changes in the constitution of Officers (including important changes related to the number and terms of office of Officers);
(v)appointment or dismissal of a manager or any other important employee;
(vi)establishment, changes in, or closure of a branch office or any other important organization;
(vii)share exchange, share transfer, or share delivery, or split or merger of the company;
(viii)the transfer, acquisition, suspension, or discontinuation of the business in whole or in part;
(ix)important changes in the policy concerning dividend distribution;
(x)important changes in the policy concerning the increase in or reduction of the amount of stated capital;
(xi)delisting from the Financial Instruments Exchange Market or the rescission of registration on the Over-the-Counter Securities Market of the Securities issued thereby;
(xii)listing on the Financial Instruments Exchange Market and registration in a Registry of Over-the-Counter Traded Securities of the Securities issued thereby; and
(xiii)any other matter specified by Cabinet Office Order as being equivalent to what is set forth in the preceding items.
(2)The combinations of two or more days of each month designated pursuant to the provisions of Cabinet Order, referred to in Article 27-26, paragraph (3) of the Act, are any of the following:
(i)the second and forth Monday of each month (if there is a fifth Monday, this means the second, fourth and fifth Monday); or
(ii)the fifteenth and last day of each month (if those days fall on a Saturday, this means the previous day thereto, and if those days fall on a Sunday, this means the day two days before).
(3)The period specified by Cabinet Order that is provided for in Article 27-26, paragraphs (4) and (5) of the Act is the period until five days (not counting any Non-Business Days of Administrative Organs) have elapsed from the first Reference Date (meaning the Reference Date set forth in Article 27-26, paragraph (3) of the Act) that arrives on or after the day on which the Holding Ratio of Share Certificates, etc. has exceeded five percent or the date of the increase.
(Share Certificates Equivalent to Listed Share Certificates)
Article 14-9The Share Certificates, etc. specified by Cabinet Order that are provided for in Article 27-27, item (ii) of the Act (including as applied mutatis mutandis pursuant to Article 27-29, paragraph (2) of the Act; hereinafter the same applies in this Article) are Share Certificates, etc. that fall under the category of Over-the-Counter Traded Securities; and the Authorized Financial Instruments Firms Association specified by Cabinet Order that is provided for in Article 27-27, item (ii) and Article 27-28, paragraph (2) of the Act (including as applied mutatis mutandis pursuant to Article 27-29, paragraph (2) of the Act) is the Authorized Financial Instruments Firms Associations that registers the Share Certificates, etc.
Chapter III-3 Special Rules on Procedures Undertaken Using an Electronic Data Processing System for Disclosure
(Means of Undertaking Electronic Disclosure Procedures or Discretionary Electronic Disclosure Procedures Using an Electronic Data Processing System for Disclosure)
Article 14-10(1)A person that carries out Electronic Disclosure Procedures (meaning the Electronic Disclosure Procedures defined in Article 27-30-2 of the Act; hereinafter the same applies in this Article and the following Article) or Discretionary Electronic Disclosure Procedures (meaning the Discretionary Electronic Disclosure Procedures defined in Article 27-30-2 of the Act; hereinafter the same applies in this Article and the following Article) using an Electronic Data Processing System for Disclosure under Article 27-30-3, paragraph (1) or (2) of the Act must, pursuant to the provisions of Cabinet Office Order, carry out those procedures by inputting the particulars that are required to be stated in written documents when Electronic Disclosure Procedures or Discretionary Electronic Disclosure Procedures are carried out in writing, through an input-output device which complies with the technical standards specified by the Commissioner of the Financial Services Agency.
(2)A person that carries out Electronic Disclosure Procedures or Discretionary Electronic Disclosure Procedures as referred to in the preceding paragraph must, pursuant to the provisions of Cabinet Office Order, notify the Commissioner of the Financial Services Agency to that effect in advance, and submit its articles of incorporation and other documents; provided, however, that this does not apply if the person that has already made the notification under this paragraph periodically submits the articles of incorporation and other documents pursuant to the provisions of Cabinet Office Order and to other cases specified by Cabinet Office Order.
(Means for Electronic Disclosure Procedures or Discretionary Electronic Disclosure Procedures by Submission of Magnetic Discs)
Article 14-11(1)A person that seeks approval from the Commissioner of the Financial Services Agency to carry out Electronic Disclosure Procedures or Discretionary Electronic Disclosure Procedures through the submission of a magnetic disc (including any object with an equivalent means of reliably storing fixed sets of data; hereinafter the same applies in this Article) under the provisions of Article 27-30-4, paragraph (1) or (2) of the Act must, pursuant to the provisions of Cabinet Office Order, submit documents containing the reasons for submitting a magnetic disc and other particulars specified by Cabinet Office Order to the Commissioner of the Financial Services Agency.
(2)A person that submits a magnetic disc with the approval referred to in the preceding paragraph must, pursuant to the provisions of Cabinet Office Order, record the particulars that it is established must be stated in written documents when Electronic Disclosure Procedures or Discretionary Electronic Disclosure Procedures are carried out in writing, in a magnetic disc that complies with the technical standards specified by the Commissioner of the Financial Services Agency and submit it to thereto.
(Exemptions on Electronic Disclosure Procedures by Use of Electronic Data Processing System for Disclosure)
Article 14-11-2The causes specified by Cabinet Order that are provided for in Article 27-30-5, paragraph (1), item (i) of the Act are the case of impossibility of the operation of the electronic data processing system which links via telecommunications line the computers referred to in Article 27-30-2 of the Act, in cases of a cut off of the power supply or any other reason.
(Means of Public Inspection by the Commissioner of the Financial Services Agency)
Article 14-12When making the particulars that have been recorded in a file available for public inspection pursuant to the provisions of Article 27-30-7, paragraph (1) of the Act, the Commissioner of the Financial Services Agency is to make those particulars available for public inspection by causing them to be displayed at finance bureaus and the Fukuoka Local Finance Branch Bureau on the screens of input/output devices of computers they use or by using the Internet.
(Means of Public Inspection by a Financial Instruments Exchange)
Article 14-13When making the particulars of which it has been notified available for public inspection pursuant to the provisions of Article 27-30-8, paragraph (1) of the Act, a Financial Instruments Exchange or an Authorized Financial Instruments Firms Association as set forth in Article 3 is to make those particulars available for public inspection by causing them to be displayed at their offices on the screens of input/output devices of computers they use.
Chapter III-4 Provision or Publication of Specified Information on Securities
(Cases in Which Specified Information on Securities Need Not Be Provided or Publicized)
Article 14-14The case specified by Cabinet Order that is provided for in Article 27-31, paragraph (1) of the Act is the case in which solicitation is made to less than fifty persons.
Chapter III-5 Disclosure of Material Information
(Securities Excluded from Consideration as the Securities of a Listed Company)
Article 14-15The Securities specified by Cabinet Order as being excluded from consideration as Securities, as provided in Article 27-36, paragraph (1) of the Act, are the following Securities:
(i)among the Securities set forth in Article 2, paragraph (1), item (v) of the Act, those specified by Cabinet Office Order as the Securities by which assets are acquired by money obtained from the issuance of those Securities and the obligations of those Securities are performed by money obtained from the administration and disposition of those assets; and
(ii)among the Securities set forth in Article 2, paragraph (1), item (xi), those issued by persons other than the following:
(a)an Investment Corporation (meaning an Investment Corporation as prescribed in Article 2, paragraph (12) of the Act on Investment Trusts and Investment Corporations; hereinafter the same applies in this item and Article 14-17, item (vi)) which provides in its certificate of incorporation that it is to invest an amount exceeding 50 percent of the total amount of its assets in real property or any other assets specified by Cabinet Office Order;
(b)that specified by Cabinet Office Order as an Investment Corporation wherein the total value of the assets specified by Cabinet Office Order, referred to in (a), accounts for more than 50 percent of the total amount of its assets; or
(c)a Foreign Investment Corporation that is similar to an Investment Corporation as set forth in (a) or (b).
(Scope of Securities Whose Issuer Comes to Be a Listed Company)
Article 14-16The Securities set forth in Article 2, paragraph (1), item (v), (vii), (ix) or (xi) of the Act (excluding those set forth in the items of the preceding Article) which are listed on a Financial Instruments Exchange or Securities falling under the category of Over-the-Counter Traded Securities or any other Securities specified by Cabinet Order that are provided for in Article 27-36, paragraph (1) of the Act are as follows:
(i)the Securities set forth in Article 2, paragraph (1), item (v), (vii),(ix) or (xi) of the Act (excluding those set forth in the items of the preceding Article and the foreign investment securities set forth in Article 2, paragraph (1), item (xi) of the Act; hereinafter the same applies in the following item) which are listed on a Financial Instruments Exchange or which fall under the category of Over-the-Counter Traded Securities or Tradable Securities (meaning the tradable securities prescribed in Article 67-18, item (iv) of the Act; the same applies hereinafter);
(ii)a Beneficiary Certificate of Securities in Trust of which the Entrusted Securities are the Securities set forth in Article 2, paragraph (1), item (v), (vii),(ix) or (xi) of the Act (excluding those set forth in the preceding item), which are listed on a Financial Instruments Exchange or fall under the category of Over-the-Counter Traded Securities or Tradable Securities;
(iii)the instruments or certificates issued by a foreign person which have the nature of the Securities set forth in Article 2, paragraph (1), item (v), (vii) or (ix) of the Act (excluding those set forth in item (i) of the preceding Article; hereinafter the same applies in this Article) or the foreign investment securities set forth in Article 2, paragraph (1), item (xi) of the Act (excluding those set forth in item (ii) of the preceding Article; hereinafter the same applies in this Article), if these Securities are listed on a Financial Instruments Exchange or fall under the category of Over-the-Counter Traded Securities or Tradable Securities (excluding those listed on a Designated Foreign Financial Instruments Exchange);
(iv)a Beneficiary Certificate of Securities in Trust of which the Entrusted Securities are the instruments or certificates issued by a foreign person which have the nature of the Securities set forth in Article 2, paragraph (1), item (v), (vii), or (ix) of the Act (excluding those set forth in the preceding item and those listed on a Designated Foreign Financial Instruments Exchange) or the foreign investment securities set forth in Article 2, paragraph (1), item (xi) of the Act (excluding those set forth in the preceding item and those listed on a Designated Foreign Financial Instruments Exchange), if these Securities are listed on a Financial Instruments Exchange or fall under the category of Over-the-Counter Traded Securities or Tradable Securities; and
(v)instruments or certificates issued by a person to which the instruments or certificates issued by a foreign person which have the nature of the Securities set forth in Article 2, paragraph (1), item (v), (vii), or (ix) of the Act (excluding those set forth in item (iii), those listed on a Designated Foreign Financial Instruments Exchange, and those that are the Entrusted Securities of the Certificates of a beneficial interest in a securities trust as set forth in the preceding item) or the foreign investment securities set forth in Article 2, paragraph (1), item (xi) of the Act (excluding those set forth in item (iii), those listed on a Designated Foreign Financial Instruments Exchange, and those that are the Entrusted Securities of the Certificates of a beneficial interest in a securities trust as set forth in the preceding item) have been deposited in a state other than the state wherein the deposited instruments or certificates or foreign investment securities had been issued, and among those that indicate rights associated with deposited instruments or certificates or foreign investment securities, those listed on a Financial Instruments Exchange or fall under the category of Over-the-Counter Traded Securities or Tradable Securities.
(Scope of Listed Securities)
Article 14-17Securities as set forth in Article 2, paragraph (1), item (v), (vii), (ix), or (xi) of the Act (excluding those set forth in the items of Article 14-15), Securities as set forth in item (xix) of that paragraph that indicate Options on the aforementioned Securities, or other Securities specified by Cabinet Order of a Listed Company, etc., as provided in the proviso to Article 27-36, paragraph (1) of the Act, are as follows:
(i)Securities as set forth in Article 2, paragraph (1), item (v), (vii), (ix), or (xi) of a Listed Company, etc. (excluding those set forth in the items of Article 14-15 and the Foreign Investment Securities set forth in item (xi) of that paragraph);
(ii)instruments or certificates issued by a Listed Company, etc. that is a foreign person which have the nature of the Securities set forth in Article 2, paragraph (1), item (v), (vii) or (ix) of the Act (excluding those set forth in Article 14-15, item (i); the same applies in the following item and item (iv)) or foreign investment securities as set forth in item (xi) of that paragraph of a Listed Company, etc. (excluding those set forth in Article 14-15, item (ii); the same applies in the following item and item (iv)), if these Securities are listed on a Financial Instruments Exchange or fall under the category of Over-the-Counter Traded Securities or Tradable Securities;
(iii)instruments or certificates issued by a Listed Company, etc. that is a foreign person which have the nature of the Securities set forth in Article 2, paragraph (1), item (v), (vii) or (ix) of the Act (excluding those set forth in the preceding item) or foreign investment securities as set forth in item (xi) of that paragraph of a Listed Company, etc. (excluding those set forth in the preceding item), if the Certificates of a beneficial interest in a securities trust for which the Entrusted Securities constitute any such Securities are listed on a Financial Instruments Exchange or fall under the category of Over-the-Counter Traded Securities or Tradable Securities;
(iv)instruments or certificates issued by a Listed Company, etc. that is a foreign person which have the nature of the Securities set forth in Article 2, paragraph (1), item (v), (vii) or (ix) of the Act (excluding those set forth in the preceding two items) or foreign investment securities as set forth in item (xi) of that paragraph of a Listed Company, etc. (excluding those set forth in the preceding two items), if the Securities set forth in item (xx) of that paragraph that indicate rights associated with the relevant Securities are listed on a Financial Instruments Exchange or fall under the category of Over-the-Counter Traded Securities or Tradable Securities;
(v)Securities as set forth in Article 2, paragraph (1), item (x) of the Act which are related to an Investment Trust (meaning an Investment Trust as defined in Article 2, paragraph (3) of the Act on Investment Trusts and Investment Corporations; the same applies hereinafter) or a Foreign Investment Trust (meaning a Foreign Investment Trust as prescribed in Article 2, paragraph (24) of that Act; the same applies hereinafter) similar thereto which provides in the basic terms and conditions of the trust contract that the trust property is only to be invested in Securities as set forth in the preceding items of a Listed Company, etc. (hereinafter referred to as "Subject Securities" in this Article);
(vi)Securities as set forth in Article 2, paragraph (1), item (xi) of the Act which are issued by an Investment Corporation or by a Foreign Investment Corporation similar thereto which provides in its certificate of incorporation that the assets are only to be invested in Subject Securities of a Listed Company, etc.;
(vii)Securities as set forth in Article 2, paragraph (1), item (xix) of the Act that indicate Options on Subject Securities of a Listed Company, etc.;
(viii)Securities as set forth in Article 2, paragraph (1), item (xx) of the Act that indicate rights associated with Subject Securities of a Listed Company, etc.;
(ix)Certificates of a beneficial interest in a securities trust of which the Entrusted Securities are Subject Securities of a Listed Company, etc.;
(x)corporate bond certificates (excluding corporate bond certificates with share options) issued by a company other than a Listed Company, etc. with a special provision that allows the redemption of those corporate bond certificates through Subject Securities of a Listed Company, etc. (limited to those in connection with which the person that holds the corporate bond certificates has the right to have the issuer company of those corporate bond certificates redeem those corporate bond certificates through Subject Securities); and
(xi)instruments or certificates issued by a foreign person which have the nature of Securities as set forth in the preceding item.
Chapter IV Financial Instruments Business Operators
(Underwriting of Securities Constituting a Managing Underwriter)
Article 15The Underwriting of Securities specified by Cabinet Order that is provided for in Article 28, paragraph (1), item (iii), (a) of the Act is that for which discussions are held with the issuer or holder (excluding a Financial Instruments Business Operator and Registered Financial Institution (meaning a Registered Financial Institution as set forth in Article 2, paragraph (11) of the Act; the same applies hereinafter); hereinafter the same applies in this Article and Article 17-3, item (iii)) of the Securities for fixing the contents of the Wholesale Underwriting Contract (meaning any of the contracts set forth in the following items concluded for a Public Offering or Secondary Distribution of Securities, Exclusive solicitation for acquisition Targeting Professional Investors (meaning the Exclusive solicitation for acquisition Targeting Professional Investors set forth in Article 4, paragraph (3), item (i) of the Act; the same applies hereinafter), or Solicitation for selling, etc. Only for Professional Investors (meaning the Solicitation for selling, etc. Only for Professional Investors set forth in Article 2, paragraph (6) of the Act; the same applies hereinafter)) upon the conclusion of that Underwriting Contract, and which are specified by Cabinet Office Order:
(i)a contract wherein the relevant party will acquire the Securities in whole or in part from the issuer or the holder of those Securities for the purpose of having those Securities acquired by other persons;
(ii)a contract wherein, if there are no persons to acquire the Securities in whole or in part, the Underwriter will acquire the remaining Securities from the issuer or holder of the Securities; and
(iii)a contract wherein, if the Securities are share option certificates (meaning share option certificates set forth in Article 28, paragraph (7), item (iii) of the Act; hereinafter the same applies in this item and Article 17-3, item (iii), (c)) and the person that has acquired them does not exercise the share options (meaning the share option set forth in Article 28, paragraph (7), item (iii) of the Act; hereinafter the same applies in this item and Article 17-3, item (iii), (c)) associated with all or some of them, the relevant party will acquire the share option certificates associated with the unexercised share options from the issuer or holder thereof and that party or a third party is to exercise those share options.
(Acts to Be the Cause of Cash Settlement)
Article 15-2The acts specified by Cabinet Order that are provided for in Article 28, paragraph (8), item (iv), (a) of the Act are, with regard to purchase and sale wherein the parties thereto promise to deliver and take delivery of a Security and its value at a fixed time in the future without recourse to a Financial Instruments Market or a Foreign Financial Instruments Market, the act of cancellation of the purchase and sale contract by the parties thereto.
(Subject Transactions of Brokerage for Clearing of Securities Which Are Securities Services)
Article 15-3The other transactions specified by Cabinet Order that are provided for in Article 28, paragraph (8), item (vii) of the Act are as follows:
(i)the lending and borrowing of the money needed to settle a Margin Transaction, etc. (meaning a Margin Transaction, purchase and sale of Securities, or Securities-Related Market Derivatives Transaction (meaning the transactions set forth in Article 28, paragraph (8), item (iii) of the Act; the same applies hereinafter) made on a Financial Instruments Business Operator's own account, or Brokerage for Clearing of Securities, etc. (limited to that related to a Margin Transaction, purchase and sale of Securities, or Securities-Related Market Derivatives Transaction made on a Financial Instruments Business Operator's own account); the same applies in the following item) (limited to an instance of lending and borrowing in which the lending is done by a Securities Finance Company);
(ii)the lending and borrowing of Securities (if a person other than a Securities Finance Company loans the Securities necessary for the settlement of a Margin Transaction, etc. by utilizing the clearing systems of a Financial Instruments Exchange Market or Over-the-Counter Securities Market, this is limited to lending associated with a Margin Transaction, etc. undertaken without recourse to a Financial Instruments Exchange Market or an Over-the-Counter Securities Market);
(iii)the delivery and receipt of collateral for the transactions set forth in the preceding two items;
(iv)the payment and receipt of beneficiary certificates or Money, etc. with regard to the establishment of a Securities Investment Trust, the redemption of a part of the principal of a Securities Investment Trust, or the exchange between beneficiary certificates of a Securities Investment Trust and Listed Securities, etc.; and
(v)beyond what is set forth in the preceding three items, the delivery or payment and receipt of Securities or money, made for the performance of obligations arisen from the purchase and sale of Securities, Transactions of Securities-Related Derivatives (meaning the Transactions of Securities-Related Derivatives set forth in Article 28, paragraph (8), item (vi) of the Act; the same applies hereinafter), or the transactions set forth in the preceding items.
(Employees Related to the Application for Registration or Notification)
Article 15-4The employee specified by Cabinet Order that is provided for in Article 29-2, paragraph (1), item (iv) and Article 29-4, paragraph (1), items (ii) and (iii) of the Act is an employee that falls under any of the following items:
(i)a person that supervises the function of providing guidance to ensure that Laws and Regulations, etc. (meaning laws and regulations, dispositions of a government agency given under laws and regulations, the articles of incorporation, or any other rules; the same applies hereinafter) are observed with regard to a Financial Instruments Business, or any other person specified by Cabinet Office Order as being equivalent thereto;
(ii)a person that supervises the section which gives advice or makes investments (including the orders given therefor) with regard to Investment Advisory Business (meaning an Investment Advisory Business as prescribed in Article 28, paragraph (6) of the Act; the same applies hereinafter) or Investment Management Business (meaning the Investment Management Business set forth in Article 28, paragraph (4) of the Act; the same applies hereinafter), or any other person specified by Cabinet Office Order as being equivalent thereto.
(Securities Not Requiring an Indication in a Written Application for Registration That the Relevant Person Will Provide Electronic Public Offering Services)
Article 15-4-2The Securities specified by Cabinet Order that are provided for in Article 29-2, paragraph (1), item (vi) of the Act are the following Securities:
(i)the Securities set forth in Article 2, paragraph (1), items (i) and (ii) of the Act;
(ii)Securities for which the government guarantees the redemption of the principal or the payment of interest;
(iii)the Securities set forth in Article 2-1;
(iv)Securities for which a notification under Article 4, paragraphs (1) to (3) or a Shelf Registration (meaning the Self Registration prescribed in Article 23-3, paragraph (3) of the Act) has been made;
(v)in a case in which disclosure has been made as prescribed in Article 4, paragraph (7) of the Act (limited to the case set forth in item (ii) of that paragraph) with regard to Securities, those Securities;
(vi)Securities associated with a Secondary Distribution that falls under Article 4, paragraph (1), item (iv) of the Act; and
(vii)those of the rights set forth in Article 2, paragraph (2), item (v) or (vi) of the Act that are deemed to be Securities pursuant to that paragraph that are associated with the business of lending money by allocating an amount exceeding 50 percent of the total amount of money or other property invested or contributed by persons that hold the rights in question.
(Calculation of the Amount of Brought-In Capital)
Article 15-5If assets brought into Japan include an amount indicated in a foreign currency, the total amount of Brought-in Capital referred to in Article 29-2, paragraph (4) of the Act must be calculated by converting the assets into Japanese currency using the Exchange Rate (meaning the basic exchange rate or the arbitrated exchange rate of a foreign currency set forth in Article 7, paragraph (1) of the Foreign Exchange and Foreign Trade Act; the same applies hereinafter).
(Scope of Acts That Give the Criteria for Registration)
Article 15-6The Acts specified by Cabinet Order that are provided for in Article 29-4, paragraph (1), item (i), (c) and Article 33-5, paragraph (1), item (ii) of the Act are as follows:
(i)the Patent Act (Act No. 121 of 1959);
(ii)the Utility Model Act (Act No. 123 of 1959);
(iii)the Design Act (Act No. 125 of 1959);
(iv)the Trademark Act (Act No. 127 of 1959);
(v)the Copyright Act (Act No. 48 of 1970);
(vi)the Act on Layout-Design of Semiconductor Integrated Circuits (Act No. 43 of 1985);
(vii)the Act on Special Treatment of Corporate Reorganization Proceedings and Other Insolvency Proceedings of Financial Institutions (Act No. 95 of 1996);
(viii)the Plant Variety Protection and Seed Act (Act No. 83 of 1998);
(ix)the Civil Rehabilitation Act (Act No. 225 of 1999);
(x)the Act on Recognition and Assistance for Foreign Insolvency Procedures (Act No. 129 of 2000);
(xii)the Act on Authorization of Public Interest Incorporated Association and Public Interest Incorporated Foundation (Act No. 49 of 2006);
(xiii)the Corporate Reorganization Act (Act No. 54 of 2002);
(xiv)the Bankruptcy Act (Act No. 75 of 2004); and
(xv)the Companies Act.
(Minimum Amount of Stated Capital of a Financial Instruments Business Operator)
Article 15-7(1)The amount specified by Cabinet Order that is provided for in Article 29-4, paragraph (1), item (iv), (a) of the Act (including as applied mutatis mutandis pursuant to Article 31, paragraph (5) of the Act) is the amount specified in the relevant of the following items for the category of case set forth in that item:
(i)if a Financial Instruments Business Operator seeks to carry out business related to the acts set forth in Article 28, paragraph (1), item (iii), (a) of the Act: three billion yen;
(ii)if a Financial Instruments Business Operator seeks to carry out business related to the acts set forth in Article 28, paragraph (1), item (iii), (b) of the Act (excluding the case set forth in the preceding item): 500 million yen;
(ii)-2if a Financial Instruments Business Operator seeks to carry out Specified Over-the-Counter Derivatives Transactions or intermediation, brokerage (excluding Brokerage for Clearing of Securities, etc.), or agency therefor using an electronic data processing system that it uses for its business of Over-the-Counter Derivatives Transactions, etc. (excluding the case set forth in the preceding two items): 300 million yen;
(iii)if a Financial Instruments Business Operator seeks to carry out a Type I Financial Instruments Business (excluding a Type I Small Amount Electronic Public Offering Business (meaning the Type I Small Amount Electronic Public Offering Business set forth in Article 29-4-2, paragraph (10) of the Act; the same applies hereinafter)) (excluding the cases set forth in the preceding three items): 50 million yen;
(iv)if a Financial Instruments Business Operator seeks to carry out an Investment Management Business (excluding an Investment Management Business for Qualified Investors (meaning the Investment Management Business for Qualified Investors set forth in Article 29-5, paragraph (1) of the Act; the same applies hereinafter)) (excluding the cases set forth in items (i) to (ii)-2): 50 million yen;
(v)if a Financial Instruments Business Operator seeks to carry out a Type II Financial Instruments Business (meaning a Type II Financial Instruments Business set forth in Article 28, paragraph (2) of the Act and excluding a Type II Small Amount Electronic Public Offering Service (meaning a Type II Small Amount Electronic Public Offering Service set forth in Article 294-3, paragraph (4) of the Act; the same applies hereinafter)) (excluding the cases set forth in the preceding items): ten million yen;
(vi)if a Financial Instruments Business Operator seeks to carry out a Type I Small Amount Electronic Public Offering Service (excluding the cases set forth in items (i) to (iv)): ten million yen;
(vii)if a Financial Instruments Business Operator seeks to carry out an Investment Management Business for Qualified Investors (excluding the cases set forth in items (i) to (iii)): ten million yen; and
(viii)if a Financial Instruments Business Operator seeks to carry out a Type II Small Amount Electronic Public Offering Service (excluding the cases set forth in the preceding items): five million yen.
(2)If an applicant is a foreign corporation and the amount of stated capital or the total amount of investment set forth in Article 29-4, paragraph (1), item (iv), (a) of the Act is to be converted into Japanese currency, the conversion is to be made by using the Exchange Rate at the time of registration under Article 29 of the Act, or at the time of the application for changes to the registration under Article 31, paragraph (4) of the Act.
(Persons Similar to Those Engaged in the Same Type of Business as a Type 1 Financial Instruments Business in a Foreign State)
Article 15-8The persons specified by Cabinet Order that are provided for in Article 29-4, paragraph (1), item (v), (a) of the Act (including as applied mutatis mutandis pursuant to Article 31, paragraph (5) of the Act) are persons all of whose Issued Shares or equity in investment are held by persons engaged in the same type of business as Type 1 Financial Instruments Business.
(Minimum Net Assets of a Financial Instruments Business Operator)
Article 15-9(1)The amount specified by Cabinet Order that is provided for in Article 29-4, paragraph (1), item (v), (b) of the Act (including as applied mutatis mutandis pursuant to Article 31, paragraph (5) of the Act) is the amount specified in the relevant of the items of Article 15-7, paragraph (1) (excluding items (v) and (viii)) for the category of case set forth in that item.
(2)If an applicant is a foreign corporation and the amount of Net Assets set forth in Article 29-4, paragraph (1), item (iv) of the Act is converted into Japanese currency, the conversion is to be made using the Exchange Rate at the time of registration under Article 29 of the Act, or at the time of the application for changes to the registration under Article 31, paragraph (4) of the Act.
(Special Relationship)
Article 15-10(1)The special relationship specified by Cabinet Order that is provided for in Article 29-4, paragraph (5), item (ii) of the Act (including as applied mutatis mutandis pursuant to Article 31, paragraph (5) and Article 32, paragraph (5) of the Act) is the relationship specified in the relevant of the following items for the category of persons set forth in that item:
(i)a person that holds Subject Voting Rights (meaning Subject Voting Rights as defined in Article 29-4, paragraph (2) of the Act and excluding Subject Voting Rights which are deemed to be held under the provisions of Article 29-4, paragraph (5) of the Act (limited to the part that involves item (ii)); hereinafter the same applies in this item) or a person whose Subject Voting Rights are held by a Controlled Company: the relationship between that person and the following persons:
(a)a person that jointly holds Subject Voting Rights with that person, or that has agreed to jointly exercise Subject Voting Rights with that person (referred to as a "Joint Holder" in paragraph (3));
(b)the person's spouse;
(c)the person's Controlled Company;
(d)the person's Controlling Shareholder, etc.; and
(e)another Controlled Company of the person's Controlling Shareholder, etc.;
(ii)persons other than those set forth in the preceding item: the relationship between that person and the persons set forth in (a) or (b) of that item.
(2)The term "Controlling Shareholder, etc." referred to in item (i), (d) and (e) of the preceding paragraph means a person that holds voting rights constituting over 50 percent of the Voting Rights Held by All the Shareholders, etc. of a company, and the term "Controlled Company" referred to in item (i) of the preceding paragraph means a company in which voting rights constituting over 50 percent of the Voting Rights Held by All the Shareholders, etc. are held by a Controlling Shareholder, etc. In this case, if a Controlling Shareholder, etc. and the Controlled Company thereof jointly hold voting rights that constitute over 50 percent of Voting Rights Held by All the Shareholders, etc. of another company, the other company is deemed to be the Controlled Company of the Controlling Shareholder, etc. and the Controlling Shareholder, etc. is deemed to be the Controlling Shareholder, etc. of the other company.
(3)If there is a person that, together with a Joint Holder, jointly holds voting rights constituting over 50 percent of the Voting Rights Held by All the Shareholders, etc. of a company, each of those persons is deemed to be a Controlling Shareholder, etc. (meaning a Controlling Shareholder, etc. as prescribed in the preceding paragraph; the same applies in the following paragraph) of the company, the company is deemed to be a Controlled Company (meaning a Controlled Company as prescribed in the preceding paragraph; the same applies in the following paragraph) of that person, and the provisions of paragraph (1) apply.
(4)If there is a person that, together with that person's spouse, jointly holds voting rights constituting over 50 percent of the Voting Rights Held by All the Shareholders, etc. of a company, that person is deemed to be the Controlling Shareholder, etc. of that company, the company is deemed to be the Controlled Company of that person, and the provisions of paragraph (1) apply.
(Securities for Which Handling of Public Offerings Cannot Be Carried Out in a Type I Small Amount Electronic Public Offering Business or a Type II Small Amount Electronic Public Offering Business)
Article 15-10-2(1)What are specified by Cabinet Order that are provided for in Article 29-4-2, paragraph (10) of the Act are the following:
(i)Securities set forth in Article 15-4-2, items (iv) and (v); and
(ii)the right prescribed in Article 2-9, paragraph (1) and the rights set forth in Article 2-10, paragraph (1), item (v) and Article 15-4-2, item (vii).
(2)The Securities specified by Cabinet Order that are provided for in Article 29-4-3, paragraph (4) of the Act are those set forth in item (ii) of the preceding paragraph.
(Handling of Public Offerings of Securities When the Total Issue Value and the Amount to Be Paid by Persons Acquiring the Securities Are Small)
Article 15-10-3The requirements specified by Cabinet Order that are provided for in Article 29-4-2, paragraph (10) and Article 29-4-3, paragraph (4) of the Act are the following:
(i)the amount calculated by the method specified by Cabinet Office Order as the total issue value is less than 100 million yen; and
(ii)the amount calculated by the method specified by Cabinet Office Order as the amount to be paid by the person that acquires the Securities is 500,000 yen or less.
(Scope of Rights Holders in Investment Management Business for Qualified Investors)
Article 15-10-4The persons specified by Cabinet Order that are provided for in Article 29-5, paragraph (1), item (i) of the Act are the following persons:
(i)a Creditor of an Investment Corporation (meaning a Creditor of an Investment Corporation referred to in Article 139-3, paragraph (1), item (vii) of the Act on Investment Trusts and Investment Corporations) of a Registered Investment Corporation (meaning a Registered Investment Corporation referred to in Article 2, paragraph (13) of that Act) that is the counterparty to a contract set forth in Article 2, paragraph (8), item (xii), (a) of the Act; and
(ii)an Investor (meaning an employee of a Foreign Investment Corporation) and a foreign Creditor of an Investment Corporation (meaning a person that holds the rights indicated on the Foreign Investment Securities as provided in the Act on Investment Trusts and Investment Corporations which are equivalent to the Investment Corporation Bond Certificates) that is the counterparty to a contract set forth in Article 2, paragraph (8), item (xii), (b) of the Act.
(Total Amount of All Investment Properties in Investment Management Business for Qualified Investors)
Article 15-10-5The amount specified by Cabinet Order that is provided for in Article 29-5, paragraph (1), item (ii) of the Act is 20 billion yen.
(Dealings in Private Placement Not Likely to Involve a Transfer to Persons Other Than Qualified Investors)
Article 15-10-6The dealings in Private Placement specified by Cabinet Order that are provided for in Article 29-5, paragraph (2) of the Act are those satisfying the following requirements for the category of cases set forth in the following items:
(i)cases in which rights associated with the Securities are indicated on financial values which can be transferred by using an electronic data processing system: technical measures or other measures specified by Cabinet Office Order have been taken to make it impossible to transfer that financial values to persons other than Qualified Institutional Investors (meaning the Qualified Institutional Investors prescribed in Article 29-5, paragraph (3) of the Act; the same applies in the following item); and
(ii)cases other than those set forth in the preceding item: the dealings in Private Placement are undertaken in a way that makes the acquisition conditional upon the conclusion of a contract for transfer between the issuer of the Securities and the person that seeks to acquire the Securities in response to the solicitation for acquisition them (hereinafter such a person is referred to as the "Acquirer" in this item); as well as between the person that makes the solicitation for acquisition and the Acquirer; which provides that the Acquirer will not transfer the Securities acquired thereby to persons other than Qualified Institutional Investors and providing for any other particulars specified by Cabinet Office Order.
(Persons Having a Close Relationship with a Financial Instruments Business Operator)
Article 15-10-7The persons specified by Cabinet Order as being closely related to a Financial Instruments Business Operator (including a Financial Instruments Business Operator that seeks registration set forth in Article 29 of the Act), referred to in Article 29-5, paragraph (3) of the Act, are the following persons:
(i)an Officer (meaning an Officer set forth in Article 29-2, paragraph (1), item (iii) of the Act) of the Financial Instruments Business Operator;
(ii)an employee of the Financial Instruments Business Operator;
(iii)the Parent Company, etc. (meaning a Parent Company, etc. set forth in Article 15-16, paragraph (3)) of the Financial Instruments Business Operator; and
(iv)the persons specified by Cabinet Office Order as being equivalent to the persons set forth in the preceding three items.
(Persons Investing Assets in Connection with Investment Business)
Article 15-10-8The persons specified by Cabinet Order that are provided for in Article 29-5, paragraph (4), item (ii) of the Act are the following persons:
(i)a Financial Instruments Business Operator, etc. (limited to those that engage in Investment Management Business); and
(ii)a corporation established under the laws and regulations of a foreign state, which is engaged in Investment Management Business in a foreign state (excluding those set forth in the preceding item).
(Minimum Amount of Stated Capital for Authorization)
Article 15-11(1)The amount specified by Cabinet Order that is provided for in Article 30-4, item (ii) of the Act is 300 million yen.
(2)If an applicant is a foreign corporation and the amount of stated capital referred to in Article 30-4, item (ii) of the Act or the amount of Net Assets set forth in item (iii) of that paragraph is to be converted into Japanese currency, that conversion is made by using the Exchange Rate at the time of application for authorization under Article 30, paragraph (1) of the Act.
(Amount of Deposit for Operation)
Article 15-12The amount specified by Cabinet Order that is provided for in Article 31-2, paragraph (2) of the Act is the amount stipulated in the relevant of the following items for the category of persons set forth in that item:
(i)an individual engaged in a Type II Financial Instruments Business (meaning a Type II Financial Instruments Business set forth in Article 28, paragraph (2) of the Act and excluding a Type II Small Amount Electronic Public Offering Service): ten million yen;
(ii)persons that engage only in Investment Advisory and Agency Business (meaning Investment Advisory and Agency Business set forth in Article 28, paragraph (3) of the Act; hereinafter the same applies): five million yen; and
(iii)an individual engaged in a Type II Small Amount Electronic Public Offering Service (excluding the person set forth in item (i)): five million yen.
(Requirements for Contract in Lieu of Deposit for Operation)
Article 15-13If a Financial Instruments Business Operator (limited to an individual engaged in a Type II Financial Instruments Business (meaning the Type II Financial Instruments Business prescribed in Article 28, paragraph (2) of the Act; the same applies hereinafter) or person that engages only in Investment Advisory and Agency Business; hereinafter the same applies in this Article to Article 15-15) concludes a contract as set forth in Article 31-2, paragraph (3) of the Act, it must conclude that contract with a Bank, Insurance Company, or other Financial Institution specified by Cabinet Office Order, and the contents of that contract must conform to the following requirements:
(i)if the relevant person becomes subject to an order under Article 31-2, paragraph (4) of the Act, the amount of Deposit for Operation under that order will be deposited without delay on behalf of the Financial Instruments Business Operator;
(ii)the contract will be valid for the period of one year or longer; and
(iii)unless approved by the Commissioner of the Financial Services Agency, the contract may not be cancelled, nor may its substance be changed.
(Procedures for the Execution of Rights in Connection with a Deposit for Operation)
Article 15-14(1)The person that holds the rights set forth in Article 31-2, paragraph (6) of the Act (hereinafter simply referred to as the "Rights" in this Article) may file a petition seeking execution of the Rights to the Commissioner of the Financial Services Agency.
(2)If a petition as referred to in the preceding paragraph has been filed and is found to be well-grounded, the Commissioner of the Financial Services Agency must issue public notice for persons holding Rights in relation to the Deposit for Operation to the effect that the Rights must be reported within a fixed period of not less than 60 days, and that persons not reporting their rights within that period will be excluded from the distribution procedures; and must notify the person that has filed the petition under the preceding paragraph (such a person is referred to as the "Petitioner" in the following paragraph and paragraph (4)) and the Depositor (meaning a Financial Instruments Business Operator and the person that has deposited all or part of the Deposit for Operation set forth in Article 31-2, paragraph (1) of the Act on behalf of the Financial Instruments Business Operator based on the contract set forth in paragraph (3) of that Article pursuant to the order issued under paragraph (4) of that Article; the same applies in paragraph (4) and paragraph (5)) to that effect.
(3)After a public notice has been given under the preceding paragraph, even if the Petitioner withdraws the petition, this does not stop the proceedings from progressing.
(4)The Commissioner of the Financial Services Agency must carry out an investigation into the Rights without delay after the period set forth in paragraph (2) has elapsed. In this case, the Commissioner of the Financial Services Agency must give public notice and notify the Depositor of the due date and place in advance, and give the Petitioner, persons that have reported their Rights within the relevant period, and the Depositor an opportunity to present evidence and state their opinions concerning the existence of the Rights and the amount of claims secured by those Rights.
(5)The Commissioner of the Financial Services Agency must prepare a distribution list based on the results of the investigation under the preceding paragraph and give public notice and notify the Depositor of this without delay.
(6)A dividend distribution is to be made after 80 days have elapsed from the day on which the public notice was given under the preceding paragraph and in accordance with the distribution list set forth in that paragraph.
(7)If Securities (including book-entry corporate bonds, etc. prescribed in Article 129, paragraph (1) of the Act on Transfer of Corporate Bonds, etc.) have been deposited, and it is necessary for the execution of Rights, the Commissioner of the Financial Services Agency may convert them. In this case, the costs for the conversion are deducted from the conversion value.
(Refund of Deposit for Operation)
Article 15-15(1)A Financial Instruments Business Operator, the successor thereof, or the person that has deposited the Deposit for Operation on behalf of a Financial Instruments Business Operator may, if the Financial Instruments Business Operator has come to fall under any of the following cases, have all the Deposit for Operation from the deposit refunded with the approval of the Commissioner of the Financial Services Agency:
(i)if the registration under Article 29 of the Act has been rescinded pursuant to the provisions of Article 52, paragraph (1) or (4) or Article 54 of the Act;
(ii)if the registration under Article 29 of the Act has become invalid pursuant to the provisions of Article 50-2, paragraph (2) of the Act; or
(iii)if the Financial Instruments Business Operator has obtained a change of registration set forth in Article 31, paragraph (4) of the Act for conducting Financial Instruments Business other than a Type II Financial Instruments Business (limited to cases in which this is performed by an individual) or Investment Advisory and Agency Business.
(2)A Financial Instruments Business Operator or a person that has deposited a Deposit for Operation on behalf of a Financial Instruments Business Operator may, if the amount of Deposit for Operation (including the Contract Amount (meaning the Contract Amount as defined in Article 31-2, paragraph (3) of the Act; hereinafter the same applies in this paragraph)) of the Financial Instruments Business Operator has come to exceed the amount specified in Article 15-12, have all or part of the exceeding amount refunded, within the amount obtained by deducting the Contract Amount from the amount of the Deposit for Operation, with the approval of the Commissioner of the Financial Services Agency.
(Scope of a Parent Corporation and a Subsidiary Corporation)
Article 15-16-1(1)A person that satisfies the requirements specified by Cabinet Order that is provided for in Article 31-4, paragraph (3) of the Act means one of the following persons (excluding those specified by Cabinet Office Order):
(i)the relevant person's Parent Company, etc.;
(ii)a Subsidiary Company, etc. of the relevant person's Parent Company, etc. (excluding the person itself and the person set forth in the preceding item and item (i) of the following paragraph);
(iii)an Affiliated Company, etc. of the relevant person's Parent Company, etc. (excluding the person set forth in item (ii) of the following paragraph); and
(iv)the following companies, partnerships, or any other business entity equivalent thereto (including those equivalent thereto in a foreign state and excluding the person itself and the persons set forth in the preceding three items and the items of the following paragraph; hereinafter referred to as the "Company, etc." in this item) related to the individual that holds voting rights constituting over 50 percent of the Voting Rights Held by All the Shareholders, etc. of the relevant person (hereinafter referred to as the "Specified Individual Shareholder"):
(a)a Company, etc. (including the Subsidiary Company, etc. and Affiliated Company, etc. of the Company, etc.) in which that Specified Individual Shareholder holds voting rights that constitute over 50 percent of the Voting Rights Held by All the Shareholders, etc.; and
(b)a Company, etc. in which that Specified Individual Shareholder holds voting rights constituting not less than 20 percent but not more than 50 percent of the Voting Rights Held by All the Shareholders, etc.
(2)The person that satisfies the requirements specified by Cabinet Order that is provided for in Article 31-4, paragraph (4) of the Act means one of the following persons (excluding those specified by Cabinet Office Order):
(i)the relevant person's Subsidiary Company, etc.; and
(ii)the relevant person's Affiliated Company, etc.
(3)The term "Parent Company, etc." referred to in paragraph (1), item (i) to item (iii) means those specified by Cabinet Office Order as a Company, etc. which has control over the Organ (meaning the shareholders meeting and any other organs equivalent thereto; hereinafter referred to as the "Decision Making Body" in this paragraph) which is responsible for deciding the policies for finance, operations, and business of another Company, etc. (meaning a company, partnership, or any other business entity equivalent thereto (including those equivalent thereto in a Foreign State); hereinafter the same applies in this Article) and the term "Subsidiary Company, etc." referred to in paragraph (1), items (ii), (iv), (a) of that paragraph, and item (i) of the preceding paragraph means another Company, etc. whose Decision Making Body is controlled by a Parent Company, etc. In this case, if the Parent Company, etc. and Subsidiary Company, etc. or the Subsidiary Company, etc. has control over the Decision Making Body of another Company, etc., the other Company, etc. is deemed to be the Subsidiary Company, etc. of the Parent Company, etc.
(4)The term "Affiliated Company, etc." referred to in paragraph (1), item (iii), item (iv), (a) of that paragraph, and paragraph (2), item (ii) means a Company, etc. (excluding a Subsidiary Company, etc.) specified by Cabinet Office Order over whose financial, operational, or business policy decisions another Company, etc. (inclusive of its Subsidiary Companies, etc. (meaning Subsidiary Companies, etc. as prescribed in the preceding paragraph; hereinafter the same applies in this paragraph)) is capable of exerting a material influence through investment, assumption of office as a director or other position equivalent thereto by a person that is or has been an officer or employee of the other Company, etc., financing, guarantee of obligations, provision of collateral, provision of technology, or transactions, etc. in operations and business.
(5)The particulars necessary for the determination of the holding of the voting rights as set forth in paragraph (1), item (iv) are specified by Cabinet Office Order in consideration of the mode of possession and any other circumstances.
(Scope of Subsidiary Corporation of a Specified Major Shareholder)
Article 15-16-2(1)Persons that satisfy the requirements specified by Cabinet Order prescribed in Article 32-2, paragraph (2) of the Act are the following persons:
(i)the relevant person's Subsidiary Company, etc.; and
(ii)the relevant person's Affiliated Company, etc.
(2)The term "Subsidiary Company, etc." as used in item (i) of the preceding paragraph means another company, etc. whose body that decides its financial and operational or business policies (meaning shareholders meeting or other equivalent body; hereinafter referred to as "decision-making body" in this paragraph) is controlled by its Parent Company, etc. (a company, etc. (meaning a company, partnership or other equivalent business entity, including those equivalent thereto in a foreign state; hereinafter the same applies in this Article) that controls the decision-making body of another company, etc. specified by Cabinet Office Order). In this case, if a Parent Company, etc. and its Subsidiary Company, etc. or its Subsidiary Company, etc. controls the decision-making body of another company, etc., that company, etc. is deemed as a Subsidiary Company, etc. of the Parent Company, etc.
(3)The term "Affiliated Company, etc." referred to in paragraph (1), item (ii) means a Company, etc. (excluding Subsidiary Company, etc.) specified by Cabinet Office Order over whose financial, operational, or business policy decisions another Company, etc. (inclusive of its Subsidiary Companies, etc. (meaning Subsidiary Companies, etc. as prescribed in the preceding paragraph; hereinafter the same applies in this paragraph)) is capable of exerting a material influence through investment, assumption of office as a director or other position equivalent thereto by a person that is or has been an officer or employee of the other Company, etc., financing, guarantee of obligations, provision of collateral, provision of technology, or transactions, etc. in operations and business.
(Securities Similar to Short-Term Corporate Bonds)
Article 15-17(1)What is specified by Cabinet Order as being similar to short-term corporate bonds, as provided in Article 33, paragraph (2), item (i) of the Act, is as follows:
(i)the short-term corporate bonds referred to in Article 61-10, paragraph (1) of the Insurance Business Act; and
(ii)those specified by Cabinet Office Order as being equivalent to the Securities set forth in Article 2, paragraph (1), item (iv) of the Act.
(2)What is specified by Cabinet Order as being similar to short-term investment corporation bonds provided in Article 33, paragraph (2), item (i) of the Act is securities similar to investment corporation bond certificates which are issued by a Foreign Investment Corporation and which are equivalent to the short-term investment corporation bonds prescribed in Article 139-12, paragraph (1) of the Act on Investment Trusts and Investment Corporations.
(3)Among the Securities set forth in Article 2, paragraph (1), item (xvii) of the Act, those specified by Cabinet Order that are provided for in Article 33, paragraph (2), item (i) of the Act are, among the Securities which have the nature of the Securities set forth in Article 2, paragraph (1), item (xv) of the Act, those for which the term between the day of issuance and the day of redemption is shorter than one year, or those specified by Cabinet Office Order as being equivalent to the short-term corporate bonds set forth in Article 66, item (i) of the Act on Transfer of Corporate Bonds, etc., the Securities set forth in paragraph (1), item (i) of this Order, or the provisions of Article 2, paragraph (1), item (iv) or (vii) of the Act.
(4)Among the Securities set forth in Article 2, paragraph (1), item (xxi) of the Act, those specified by Cabinet Order that are provided for in Article 33, paragraph (2), item (i) of the Act are, among the Securities set forth in Article 1, item (i), those for which the term between the day of issuance and the day of redemption is shorter than one year.
(Securities Excluded as a Subject of Private Placement by a Financial Institution)
Article 15-18The Securities specified by Cabinet Order that are provided for in Article 33, paragraph (2), item (iv), (a) of the Act are Securities as set forth in Article 2, paragraph (1), item (xix) of the Act (including Securities as set forth in Article 2, paragraph (1), item (xix) of the Act that indicate Options on such Securities) that indicate the Options on the following Securities:
(i)share certificates (including Preferred Equity Securities), share option certificates, corporate bond certificates with share options, and any other Securities specified by Cabinet Office Order as being equivalent thereto;
(ii)Securities as set forth in Article 2, paragraph (1), item (xvii) of the Act that have the nature of the Securities set forth in the preceding item; and
(iii)Securities as set forth in Article 2, paragraph (1), item (xx) of the Act that indicate rights associated with the Securities prescribed in the preceding two items.
(Cases in Which a Large Number of Persons Are the Other Parties to a Transaction)
Article 15-19The cases specified by Cabinet Order that are provided for in Article 33, paragraph (2), item (v) of the Act are cases in which the transaction set forth in (b) of that item is conducted with not less than 50 persons as the other parties.
(Subject Transaction of Brokerage for Clearing of Securities by a Financial Institution)
Article 15-20The other transactions specified by Cabinet Order that are provided for in Article 33, paragraph (2), item (vi) of the Act are as follows:
(i)the lending and borrowing of the money needed to settle Brokerage for Clearing of Securities, etc. (limited to those related to a Margin Transaction, or the purchase and sale of Securities or Securities-Related Market Derivatives Transaction made on a Financial Instruments Business Operator's own account; the same applies in the following item) (limited to an instance of lending and borrowing in which the lending is done by a Securities Finance Company);
(ii)the lending and borrowing of Securities (if persons other than a Securities Finance Company lend the Securities necessary for the settlement of Brokerage for Clearing of Securities, etc. by utilizing the clearing systems of a Financial Instruments Exchange Market or Over-the-Counter Securities Market, this is limited to lending associated with Brokerage for Clearing of Securities, etc. undertaken without recourse to a Financial Instruments Exchange Market or an Over-the-Counter Securities Market);
(iii)the delivery and receipt of collateral in a transaction as set forth in the preceding two items;
(iv)the payment and receipt of beneficiary certificates or Money, etc. with regard to the establishment of a Securities Investment Trust, the redemption of a part of the principal of a Securities Investment Trust, or the exchange between beneficiary certificates of a Securities Investment Trust and Listed Securities, etc.; and
(v)beyond what is set forth in the preceding items, delivery and receipt of Securities or money made for the performance of the obligations arisen from the purchase and sale of Securities, Transaction of Securities-Related Derivatives, or the transactions set forth in the preceding items.
(Persons Engaged in a Specified Financial Instruments Business)
Article 15-21(1)When the person engaged in a Specified Financial Instruments Business as referred to in Article 33-8, paragraph (2) of the Act performs that business, it must clearly indicate that it is the person that performs the duties on behalf of the Registered Financial Institution related to that business.
(2)The persons specified by Cabinet Order that are provided for in Article 33-8, paragraph (2), item (i) of the Act are the following persons:
(i)a Life Insurance Solicitor (meaning a life insurance solicitor as defined in Article 2, paragraph (19) of the Insurance Business Act and excluding the officers and employees of a Life Insurance Company defined in paragraph (3) of that Article or a Foreign Life Insurance Company as prescribed in paragraph (8) of that Article) that is an individual;
(ii)an officer that holds the authority of the representation of a Life Insurance Solicitor (meaning a life insurance solicitor as prescribed in Article 2, paragraph (19) of the Insurance Business Act) that is a corporation;
(iii)a Non-Life Insurance Agent (meaning a non-life insurance agent as prescribed in Article 2, paragraph (21) of the Insurance Business Act; hereinafter the same applies in this paragraph) that is an individual;
(iv)among the employees of the Non-Life Insurance Agent that is an individual, those that have been notified under Article 302 of the Insurance Business Act;
(v)among the officers or employees of a Non-Life Insurance Agent that is a corporation, those that have been notified under Article 302 of the Insurance Business Act; and
(vi)officers that hold the authority of representation of a Non-Life Insurance Agent that is a corporation.
(Provision of Particulars Using Information and Communications Technology)
Article 15-22(1)Before seeking to provide a person with the particulars prescribed in Article 34-2, paragraph (4) of the Act pursuant to that paragraph (including as applied mutatis mutandis pursuant to the provisions of Article 34-3, paragraph (12) (including as applied mutatis mutandis pursuant to the provisions of Article 34-4, paragraph (6) of the Act), Article 34-4, paragraph (3), Article 37-3, paragraph (2), Article 37-4, paragraph (2), Article 37-5, paragraph (2), Article 40-2, paragraph (6), Article 40-5, paragraph (3), and Article 42-7, paragraph (2) of the Act; hereinafter the same applies in this Article), a Financial Instruments Business Operator, etc., in advance and pursuant to the provisions of Cabinet Office Order, must indicate to the person to which it will provide that information the type and substance of the means prescribed in that paragraph that it will use to provide it (hereinafter referred to as "electronic or magnetic means" in this Article) and obtain consent for this in written form or by electronic or magnetic means.
(2)If a Financial Instruments Business Operator, etc. that has obtained consent under the preceding paragraph receives a notice from the relevant person, either in written form or by electronic or magnetic means, indicating that the person is not willing to be provided with particulars by electronic or magnetic means, the Financial Instruments Business Operator, etc. must not use electronic or magnetic means to provide the person with the particulars prescribed in Article 34-2, paragraph (4) of the Act; provided, however, that this does not apply if the person has once again given consent under the preceding paragraph.
(Gaining Agreement Using Information and Communications Technology)
Article 15-23(1)Before seeking to obtain a person's agreement by the means specified by Cabinet Office Order as prescribed in Article 34-2, paragraph (12) of the Act (including as applied mutatis mutandis pursuant to Article 34-3, paragraph (3) (including as applied mutatis mutandis pursuant to Article 34-4, paragraph (6) of the Act) and Article 43-4, paragraph (3) of the Act; hereinafter the same applies in this Article) (hereinafter referred to as "electronic or magnetic means" in this Article) in lieu of agreement in written form under Article 34-2, paragraph (11) of the Act pursuant to Article 34-2, paragraph (12) of the Act, a Financial Instruments Business Operator, etc., in advance and pursuant to the provisions of Cabinet Office Order, must indicate to the person whose agreement it is seeking the type and substance of the electronic or magnetic means it will use and obtain consent for this in written form or by electronic or magnetic means.
(2)If a Financial Instruments Business Operator that has gained a person's agreement under the preceding paragraph receives a notice from that person, either in written form or by electronic or magnetic means, indicating that the person is not willing to agree to the matter in question by electronic or magnetic means, the Financial Instruments Business Operator must not use electronic or magnetic means to gain the person's agreement as prescribed in Article 34-2, paragraph (12) of the Act; provided, however, that this does not apply if the person has once again given consent under the preceding paragraph.
(Deemed Replacement of Terms When a Subject Contract Is a Continuous Contract)
Article 15-24(1)With regard to the application of the provisions of Article 34-3, paragraph (4) of the Act if the Subject Contract set forth in Article 34-3, paragraph (4), item (ii) of the Act is an Investment Advisory Contract (meaning an Investment Advisory Contract as prescribed in Article 2, paragraph (8), item (xi) of the Act; the same applies hereinafter) or Discretionary Investment Contract, the phrase "the Applicant is deemed to be a Professional Investor for the purpose of application of this Act (excluding Article 29-5, paragraph (3) and this Subsection)" in Article 34-3, paragraph (4) of the Act is deemed to be replaced with "the Applicant is deemed to be a Professional Investor for the purpose of application of this Act (excluding Article 29-5, paragraph (3) and, this Subsection and Article 45 (limited to the part that involves item (iii) and item (iv))), and the Applicant is deemed to be a Professional Investor only during the period up to the Expiration Date (if the Financial Instruments Business Operator, etc. has given consent under paragraph (2) and the Applicant has given written consent under that paragraph for the Request for Renewal prescribed in paragraph (7) which the Applicant has made prior to the Expiration Date, the Expiration Date related to the Request for Renewal) for the purpose of the application of Article 45 (limited to the part that involves item (iii) and item (iv))".
(2)With regard to the application of the provisions of Article 34-3, paragraph (4) of the Act if the Subject Contract set forth in Article 34-3, paragraph (4), item (ii) of the Act as applied mutatis mutandis pursuant to Article 34-4, paragraph (6) of the Act is an Investment Advisory Contract or Discretionary Investment Contract, the phrase "the Applicant is deemed to be a Professional Investor for the purpose of application of this Act (excluding Article 29-5, paragraph (3) and this Subsection)" in Article 34-4, paragraph (4) of the Act is deemed to be replaced with "the Applicant is deemed to be a Professional Investor for the purpose of application of this Act (excluding Article 29-5, paragraph (3) and this Subsection and Article 45 (limited to the part that involves item (iii) and item (iv))), and the Applicant is deemed to be a Professional Investor only during the period up to the Expiration Date (if the Financial Instruments Business Operator, etc. has delivered the documents or made confirmation under paragraph (2) of the following Article and has given consent under paragraph (2) as applied mutatis mutandis pursuant to paragraph (6) of the following Article, and the Applicant has given written consent under paragraph (2) with regard to the Request for Renewal prescribed in paragraph (7) which the Applicant has made prior to the Expiration Date, the Expiration Date related to the Request for Renewal) for the purpose of the application of Article 45 (limited to the part that involves item (iii) and item (iv))".
(Assets Excluded from Consideration as Specified Assets Subject to Investment)
Article 15-25The assets specified by Cabinet Order that are provided for in Article 35, paragraph (1), item (xv), (a) of the Act are as follows:
(i)Building Lots (meaning the building lots set forth in Article 2, item (i) of the Building Lots and Buildings Transaction Business Act (Act No. 176 of 1952)) and buildings;
(ii)the commodities prescribed in Article 2, paragraph (1) of the Commodity Futures Act; and
(iii)rights associated with commodities investment, etc. transactions as set forth in Article 3, item (x) of the Order for the Enforcement of the Act on Investment Trusts and Investment Corporations.
(Goods Which Are the Subject of Investment Constituting a Notification Business)
Article 15-26The goods specified by Cabinet Order that are provided for in Article 35, paragraph (2), item (v)-2 of the Act are the commodities prescribed in Article 2, paragraph (1) of the Commodity Futures Act.
(Material Particulars That May Impact Customers' Judgment)
Article 16(1)The particulars specified by Cabinet Order that are provided for in Article 37, paragraph (1), item (iii) of the Act are as follows:
(i)the particulars of fees, remuneration, or any other consideration payable by the customer with regard to a financial instruments transaction contract (meaning a financial instruments transaction contract as defined in Article 34 of the Act; the same applies hereinafter) which are specified by Cabinet Office Order;
(ii)if there is customer margin or some other security deposit or any other thing specified by Cabinet Office Order payable by the customer with regard to the financial instruments transaction contract, the amount thereof or the calculation method therefor;
(iii)if the Amount (meaning the amount obtained by multiplying the number or volume of the transactions to the amount of consideration offered for the transactions or the Agreed Figure (meaning the Agreed Figure prescribed in Article 2, paragraph (21), item (ii) of the Act; the same applies hereinafter); hereinafter the same applies in this item and Article 18, paragraph (1), item (iii)) of Derivative Transactions (in the case of the transactions set forth in Article 2, paragraph (21), item (iii) of the Act, they are the transactions set forth in (a) and (b) of that item which are closed by the exercise of the rights under that item, in the case of the transactions set forth in Article 2, paragraph (22), item (iii) of the Act, they are the transactions set forth in (a) and (b) of that item which are closed by the exercise of the rights under that item, and in the case of the transactions set forth in Article 2, paragraph (22), item (iv) of the Act, they are the transactions wherein money is paid or received as prescribed in that item and which are closed by the exercise of the rights under that item), Margin Transactions, and any other transaction specified by Cabinet Office Order conducted by a customer (hereinafter collectively referred to as the "Derivatives Transaction, etc." in this item and Article 18, paragraph (1), item (iii)) could exceed the amount of the customer margin or other security deposit, or any other amount specified by Cabinet Office Order payable by the customer with regard to the Derivatives Transaction, etc. (hereinafter collectively referred to as the "Amount of Security Deposit, etc." in this Article and Article 18), the following particulars:
(a)to the effect that the Amount of the Derivatives Transaction, etc. may exceed the Amount of Security Deposit, etc.; and
(b)the ratio of the Amount of the Derivatives Transaction, etc. to the Amount of Security Deposit, etc. (if that ratio cannot be calculated, an indication of this and the reason therefor);
(iv)the following particulars, if there is a risk for a loss to arise that has as its direct cause fluctuations in money rates, the value of currencies, quotations on a Financial Instruments Market, or any other indicator, as regards an act that constitutes a Financial Instruments transaction (meaning an act that constitutes a Financial Instruments transaction as prescribed in Article 34 of the Act; the same applies hereinafter) conducted by a customer:
(a)the indicator in question; and
(b)an indication of the risk that fluctuations in that indicator could give rise to a loss and the reasons for this;
(v)if there is a risk that the amount of loss referred to in the preceding item could exceed the Amount of Security Deposit, etc. (hereinafter referred to as the "Risk of Loss in Excess of Principal" in this item), the following particulars:
(a)among the indicators under the preceding item, those which are the direct cause for the Risk of Loss in Excess of Principal; and
(b)an indication that there is a Risk of Loss in Excess of Principal due to fluctuations in the indicator set forth in (a) and the reason therefor;
(vi)if there is a difference between the sale price and purchase price of the Financial Instruments indicated by the Financial Instruments Business Operator, etc. with regard to the Over-the-Counter Derivatives Transactions (in cases of the transactions set forth in Article 2, paragraph (22), items (ii) to (vi) of the Act, the particulars specified by Cabinet Office Order as being equivalent to the sale price and purchase price), an indication of this; and
(vii)the particulars specified by Cabinet Office Order as being equivalent to the particulars set forth in the preceding items.
(2)Notwithstanding the provisions of the preceding paragraph, the particulars specified by Cabinet Order that are provided for in Article 37, paragraph (1), item (iii) of the Act, if the acts set forth in Article 37, paragraph (1) of the Act are to be carried out by way of broadcasting, using the broadcast equipment of a Private Broadcaster or any other means specified by Cabinet Office Order as being equivalent thereto, are as follows:
(i)if there is a risk for a loss to arise that has as its direct cause fluctuations in money rates, the value of currencies, quotations on a Financial Instruments Market, or any other indicator, as regards an act that constitutes a Financial Instruments transaction conducted by a customer, an indication of this risk (if there is a risk that the amount of the loss may exceed the Amount of Security Deposit, etc., this includes an indication of that risk); and
(ii)the particulars specified by Cabinet Office Order as being equivalent to the particulars set forth in the preceding item.
(Scope of Specified Financial Instruments Business Operator)
Article 15-27The persons specified by Cabinet Order that are provided for in Article 36, paragraph (3) of the Act are the following persons:
(i)Financial Instruments Business Operator that engages in the Securities Services (meaning Securities Services as prescribed in Article 28, paragraph (8) of the Act; the same applies hereinafter) (limited to persons registered under Article 29 of the Act for engaging in Type I Financial Instruments Business); and
(ii)Registered Financial Institution.
(Scope of Parent Financial Institution and Subsidiary Financial Institution)
Article 15-28(1)The persons specified by Cabinet Order that are provided for in Article 36, paragraph (4) of the Act are the persons set forth in the items of Article 15-16, paragraph (1).
(2)Persons engaged in financial business specified by Cabinet Order that are provided for in Article 36, paragraphs (4) and (5) are the following persons:
(i)persons set forth in the items of Article 1-9;
(ii)notifiers of Specially Permitted Services (meaning the Notifiers of Specially Permitted Services prescribed in Article 63, paragraph (5) of the Act; the same applies hereinafter);
(iii)notifiers of Specially Permitted Services for Foreign Investors, etc. (meaning the Notifiers of Specially Permitted Services for Foreign Investors, etc. prescribed in Article 63-9, paragraph (4) of the Act; the same applies hereinafter);
(iv)persons engaged in the following business in a foreign state in compliance with laws and regulations of the foreign state (excluding Financial Instruments Business Operators, banks, Cooperative Structured Financial Institutions and persons specified in the preceding three items):
(a)Financial Instruments Business;
(b)banking business prescribed in Article 2, paragraph (2) of the Banking Act (Act No. 59 of 1981); and
(c)insurance business prescribed in Article 2, paragraph (1) of the Insurance Business Act.
(3)The persons specified by Cabinet Order that are provided for in Article 36, paragraph (5) of the Act are the persons set forth in the items of Article 15-16, paragraph (2).
(Solicitation Requiring That the Prime Minister Receive Notification of the Contents of Documents)
Article 16-2The solicitation specified by Cabinet Order that is provided for in Article 37-3, paragraph (3) of the Act is solicitation in response to which not less than 500 persons conclude the Contracts for Financial Instruments Transactions related to the solicitation.
(Contracts That May Be Cancelled by the Customer)
Article 16-3(1)The financial instruments transaction contract specified by Cabinet Order that is provided for in Article 37-6, paragraph (1) of the Act is an Investment Advisory Contract.
(2)The number of days specified by Cabinet Order that is provided for in Article 37-6, paragraph (1) of the Act is ten days.
(Contracts Prohibiting Cold Calling)
Article 16-4(1)The financial instruments transaction contract specified by Cabinet Order that is provided for in Article 38, item (iv) of the Act is the following contracts:
(i)a contract wherein the following transactions from among the Over-the-Counter Derivatives Transactions are carried out with customers or a contract wherein the relevant person acts as intermediary, broker (excluding Brokerage for Clearing of Securities, etc.), or agent in those transactions on behalf of the customer:
(a)a transaction comprising a purchase and sale in which the parties to the purchase and sale promise to deliver and take delivery of a Financial Instrument (limited to those set forth in Article 2, paragraph (24), item (ii) or (iii) of the Act; hereinafter the same applies in this item) and its value at a fixed time in the future, and which the parties may settle by delivering and taking delivery of the difference in values if they sell back or buy back the underlying Financial Instrument or if they take an action that cancels the purchase and sale contract;
(b)a transaction comprising the parties' promises to pay and receive an amount of money calculated based on the difference between the numerical value of a Financial Indicator upon which the parties agree in advance (limited to the prices of the Financial Instruments or the Interest Rates, etc. (meaning the Interest Rate, etc. prescribed in Article 2, paragraph (21), item (iv) of the Act; the same applies hereinafter) of the Financial Instruments (excluding those set forth in Article 2, paragraph (24), item (iii) of the Act) or the figures calculated based thereon; hereinafter the same applies in (b)) and the actual numerical value of the Financial Indicator at a fixed time in the future, or any other similar transactions;
(c)a transaction comprising the first party's promise to grant the second party the option of effecting one of the following transactions between them by a unilateral manifestation of the second party's intention, and the second party's promise to pay the value of that option; or any other similar transaction:
1.a purchase and sale of Financial Instruments (excluding the transactions set forth in (a)); and
2.a transaction as set forth in (a) or (b);
(d)cryptoasset-related over-the-counter derivatives transactions; and
(ii)a contract wherein an Over-the-Counter Derivatives Transaction is carried out with individual customers or intermediation, brokerage (excluding Brokerage for Clearing of Securities, etc.), or agency for Over-the-Counter Derivatives Transactions is performed on behalf of individual customers (excluding those falling under the contracts set forth in the preceding item).
(2)The financial instruments transaction contract specified by Cabinet Order that is provided for in Article 38, items (v) and (vi) of the Act means one of the contracts set forth in the items of the preceding paragraph or one of the following contracts:
(i)a contract whose substance is the undertaking of intermediation, brokerage (excluding Brokerage for Clearing of Securities, etc.), or agency for the following transactions from among the Market Derivatives Transaction on behalf of customers, or the undertaking of intermediation, brokerage, or agency for the entrustment of those transactions:
(a)a transaction comprising a purchase and sale in which the parties to the purchase and sale promise to deliver and take delivery of a Financial Instrument (limited to one as set forth in Article 2, paragraph (24), item (ii) or (iii) of the Act or those set forth in Article 2, paragraph (24), item (v) of the Act (limited to those associated with those set forth in Article 2, paragraph (24), item (ii) of the Act); hereinafter the same applies in this item) and its value at a fixed time in the future, and which the parties may settle by delivering and taking delivery of the difference in values if they sell back or buy back the underlying Financial Instrument;
(b)a transaction comprising the parties' promises to pay and receive an amount of money calculated based on the difference between the numerical value of a Financial Indicator upon which the parties agree in advance (limited to the prices of the Financial Instruments or the Interest Rates, etc. of the Financial Instruments (excluding those set forth in Article 2, paragraph (24), item (iii) of the Act) or the figures calculated based thereon; hereinafter the same applies in (b)) and the actual numerical value of the Financial Indicator at a fixed time in the future, or any other similar transaction;
(c)a transaction comprising the first party's promise to grant the second party the option of effecting one of the following transactions between them by a unilateral manifestation of the second party's intention, and the second party's promise to pay the value of that option; or any other similar transaction:
1.a purchase and sale of Financial Instruments (excluding the transaction set forth in (a)); and
2.a transaction as set forth in (a) or (b) (including the transactions equivalent to the transaction set forth in (b) and which are specified by a Financial Instruments Exchange);
(d)cryptoassets-related over-the-counter derivatives transactions prescribed in Article 185-24, paragraph (1) of the Act;
(e)the Commodity-Related Market Derivatives Transactions prescribed in Article 2, paragraph (8), item (i) of the Act; and
(ii)a contract whose substance is the undertaking of intermediation, brokerage (excluding Brokerage for Clearing of Securities, etc.), or agency for transactions similar to those set forth in (a) to (d) of the preceding item from among the Foreign Market Derivatives Transactions on behalf of customers or the undertaking of intermediation, brokerage, or agency for entrustment of those transactions.
(Financial Instruments Business Operators and Authorized Firms for On-Exchange Transactions That Are Included in High-Speed Traders)
Article 16-4-2The person specified by Cabinet Order that is provided for in Article 38, item (viii) of the Act (including as applied mutatis mutandis pursuant to Article 60-13 of the Act) is a person that falls under either of the following items:
(i)a person that has obtained the registration referred to in Article 29 of the Act by stating the particulars set forth in Article 29-2, paragraph (1), item (vii), (a) of the Act in the written application for registration or a person that has made a notification under Article 31, paragraph (1) of the Act by stating those particulars (excluding a person that has made a notification under that paragraph to the effect that changes have arisen in a particular subject to that registration or notification);
(ii)a person that has obtained the registration referred to in Article 29 of the Act or the registration of a change referred to in Article 31, paragraph (4) of the Act by stating the particular set forth in Article 29-2, paragraph (1), item (vii), (b) of the Act in the written application for registration or the written application for registration of a change (excluding a person that has obtained the registration of a change referred to in that paragraph by stating, in the written application for registration of a change, an intention to make a change with regard to a particular subject to that registration or that registration of a change);
(iii)a person that has obtained the registration referred to in Article 33-2 of the Act by stating the particular set forth in Article 33-3, paragraph (1), item (vi), (a) of the Act in the written application for registration or a person that has made a notification under Article 33-6, paragraph (1) of the Act by stating that particular (excluding a person that has made a notification under that paragraph to the effect that a change has arisen in connection with a particular subject to that registration or notification); and
(iv)a person that has obtained the permission referred to in Article 60, paragraph (1) of the Act by stating the particular set forth in Article 60-2, paragraph (1), item (iv), (a) of the Act in the written application for permission or a person that has made a notification under Article 60-5, paragraph (1) of the Act by stating that particular (excluding a person that has made a notification under that paragraph to the effect that a change has arisen in connection with a particular subject to that permission or notification).
(Exemptions to the Prohibition on Compensation for Loss)
Article 16-5The transactions specified by Cabinet Order that are provided for in Article 39, paragraph (1), item (i) of the Act are, among purchase and sales on condition of repurchase related to the Securities set forth in Article 2, paragraph (1), items (i) to (v) and (xv) of the Act (excluding corporate bond certificates with share options; hereinafter the same applies in this Article), the Securities set forth in Article 2, paragraph (1), item (xvii) of the Act which have the nature of the Securities set forth in Article 2, paragraph (1), items (i) to (v) and (xv) of the Act, and the Securities set forth in Article 1, item (i) and which are, among those whose repurchase price is set in advance (hereinafter referred to as "Purchase and Sale of Bonds, etc. on Condition of Repurchase" in this Article), those carried out by a Financial Instruments Business Operator, etc. solely for the fund procurement thereof (including those carried out for procuring funds that will become insufficient due to its becoming a counterparty to another Purchase and Sale of Bonds, etc. on Condition of Repurchase)
(Exemptions to the Application of the Best Execution Policy)
Article 16-6(1)The transactions specified by Cabinet Order that are provided for in Article 40-2, paragraph (1) of the Act are as follows:
(i)purchase and sales of Securities (excluding those set forth below):
(a)the purchase and sale of Listed Share Certificates, etc. (meaning the share certificates, corporate bond certificates with share options and any other Securities specified by Cabinet Office Order which are listed on a Financial Instrument Exchange; the same applies in paragraph (3)) (excluding purchase and sale that falls under the category of a Derivatives Transaction; hereinafter the same applies in this item and paragraph (3));
(b)the purchase and sale of Over-the-Counter Traded Securities; and
(c)the purchase and sale of Tradable Securities; and
(ii)Derivatives Transactions.
(2)The Best Execution Policy, etc. under Article 40-2, paragraph (1) of the Act must be established by stating the method for executing orders under the best terms and conditions for each issue for the Transactions of Securities, etc. defined in that paragraph and the reason for choosing that method.
(3)The transactions specified by Cabinet Order that are provided for in Article 40-2, paragraph (4) of the Act are the purchase and sale of Listed Share Certificates, etc. and Over-the-Counter Traded Securities.
(Things Similar to Money)
Article 16-7The thing specified by Cabinet Order as being similar to money that is provided for in Article 40-3 and Article 40-3-2 of the Act means anything set forth in the items of Article 1-3.
(Acts That Are Subject to the Obligation of Notification Related to Securities for Professional Investors)
Article 16-7-2The acts specified by Cabinet Order that are provided for in Article 40-5, paragraph (1) of the Act are the following acts:
(i)selling the thing in question (excluding what is set forth below):
(a)selling the thing in question on a Financial Instruments Exchange Market, Over-the-Counter Securities Market, or Foreign Financial Instruments Market;
(b)selling Share Certificates, etc. (meaning Share Certificates, etc. as defined in Article 27-2, paragraph (1) of the Act) in connection with a Tender Offer as prescribed in Article 27-2, paragraph (6) of the Act;
(c)selling Listed Share Certificates, etc. (meaning the Listed Share Certificates, etc. defined in Article 24-6, paragraph (1) of the Act) in connection with a Tender Offer prescribed in Article 27-2, paragraph (6) of the Act as applied mutatis mutandis pursuant to the provisions of Article 27-22-2, paragraph (2) of the Act following the deemed replacement of terms;
(d)selling the thing in question through a purchase and sale transaction of Securities which is closed when the rights acquired or granted in the Transactions of Securities-Related Derivatives (meaning Transactions of Securities-Related Derivatives as prescribed in Article 28, paragraph (8), item (vi) of the Act and limited to the transactions set forth in Article 28, paragraph (8), item (iii), (c) of the Act (limited to a transaction as in Article 28, paragraph (8), item (iii), (c), 1. of the Act) or Article 28, paragraph (8), item (iv), (c) of the Act (limited to a transaction as in Article 28, paragraph (8), item (iv), (c), 1. of the Act)) are exercised (such a purchase and sale transaction is referred to as the "Specified Purchase and Sale Transaction" in the following item);
(e)selling associated with a purchase and sale of Securities set forth in Article 2, paragraph (8), item (x) of the Act; and
(f)beyond what is set forth in (a) to (e), anything specified by Cabinet Office Order as something that would not compromise the protection of investors;
(ii)the conclusion of a contract whose substance is the undertaking of intermediation, brokerage, or agency (excluding those set forth below) for purchases (excluding purchases conducted through Specified Purchase and Sale Transactions; hereinafter the same applies in this item):
(a)intermediation, brokerage (excluding Brokerage for Clearing of Securities, etc.), or agency for purchases made on a Financial Instruments Exchange Market, Over-the-Counter Securities Market, or Foreign Financial Instruments Market;
(b)the acts set forth in Article 2, paragraph (8), item (x) of the Act;
(c)Brokerage for Clearing of Securities, etc.; and
(d)beyond what is set forth in (a) to (c), any acts specified by Cabinet Office Order as those which would not compromise the protection of investors.
(Exemptions to the Prohibition on Purchase and Sales of Securities)
Article 16-8The cases specified by Cabinet Order that are provided for in the proviso to Article 41-3 of the Act are the following cases:
(i)a case in which the relevant acts are carried out as Type II Financial Instruments Business;
(ii)a case in which the relevant acts are carried out as Registered Financial Institution Business (meaning the Registered Financial Institution Business set forth in Article 33-3, paragraph (1), item (vi), (a) of the Act);
(iii)a case in which a Financial Instruments Business Operator that is a Financial Instruments Intermediary Service Provider carries out the relevant acts as a Financial Instruments Intermediary Service;
(iv)a case in which a Registered Financial Institution which is a Financial Institution engaged in Trust Business (meaning a Financial Institution authorized under Article 1, paragraph (1) of the Act on Concurrent Operation of Trust Business by a Financial Institution (Act No. 43 of 1943); the same applies hereinafter) carries out the relevant acts as Trust Business (meaning trust business as set forth in that paragraph; the same applies hereinafter);
(v)a case in which a Financial Instruments Business Operator that is a financial service intermediary (meaning the financial service intermediary prescribed in Article 11, paragraph (6) of the Act on the Provision of Financial Services (Act No. 101 of 2000); the same applies hereinafter) carries out the relevant acts as securities, etc. intermediary business operations (meaning the securities, etc. intermediary business operations prescribed in paragraph (4) of that Article; the same applies in Article 16-11, item (iv)); and
(vi)any case specified by Cabinet Office Order as being equivalent to the cases set forth in the preceding items.
(Exemptions to the Prohibition on Receiving Deposits of Money or Securities)
Article 16-9The cases specified by Cabinet Order that are provided for in Article 41-4 and Article 42-5 of the Act are the following cases:
(i)a case in which a Registered Financial Institution which is a Financial Institution engaged in Trust Business carries out the relevant acts as a Trust Business;
(ii)a case in which there is acceptance of deposits, savings, or Installment Savings, etc. prescribed in Article 2, paragraph (4) of the Banking Act; and
(iii)any case specified by Cabinet Office Order as being equivalent to the cases set forth in the preceding two items.
(Scope of Persons Closely Related to a Financial Instruments Business Operator)
Article 16-10The persons specified by Cabinet Order that are provided for in Article 41-4 and Article 42-5 of the Act are any of the following persons not constituting a Financial Instruments Business Operator, etc. (limited to those engaged in Securities, etc. Management Business (meaning the Securities, etc. Management Business defined in Article 28, paragraph (5) of the Act; the same applies in Article 18-2)), Bank, or other person specified by Cabinet Office Order:
(i)a relative (limited to the spouse thereof and the relatives by blood or affinity within the third degree of kinship) of the Financial Instruments Business Operator, etc. (limited to one that is an individual);
(ii)Officers (meaning the Officers as set forth in Article 29-2, paragraph (1), item (iii) of the Act and if an Officer is a corporation, this includes the members responsible for performing the duties thereof; the same applies in Article 18-2, item (ii)) or an employee of the Financial Instruments Business Operator, etc. (limited to one that is a corporation; hereinafter the same applies in this Article);
(iii)a Parent Corporation, etc. (meaning a Parent Corporation, etc. as defined in Article 31-4, paragraph (3) of the Act; the same applies hereinafter) or Subsidiary Corporation, etc. (meaning a Subsidiary Corporation, etc. as defined in Article 31-4, paragraph (4) of the Act; the same applies hereinafter) of the Financial Instruments Business Operator, etc.;
(iv)a Specified Individual Shareholder of the Financial Instruments Business Operator, etc. (excluding those set forth in the item (ii)); and
(v)the persons specified by Cabinet Office Order as being equivalent to the persons set forth in the preceding items.
(Exemptions to the Prohibition on Loans of Money or Securities Concerning Investment Advisory Business)
Article 16-11The cases specified by Cabinet Order that are provided for in the proviso to Article 41-5 of the Act are the following cases:
(i)a case in which a Financial Instruments Business Operator (limited to one engaged in a Type I Financial Instruments Business) conducts the following acts:
(a)loaning money or Securities to customers as a business set forth in Article 35, paragraph (1) of the Act (excluding those incidental to a margin transaction; the same applies in (c) of this item, (b) of the following item, and item (iv));
(b)intermediation or agency for loans of money to customers which are made by another Financial Instruments Business Operator incidentally with a margin transaction;
(c)intermediation or agency for loans of money or Securities to customers which are made by another Financial Instruments Business Operator as a business set forth in Article 35, paragraph (1) of the Act;
(ii)a case in which a Financial Instruments Business Operator that is a Financial Instruments Intermediary Service Provider carries out the following acts:
(a)intermediation for loans of money or Securities to customers which are made by an Entrusting Financial Instruments Business Operators, etc. (meaning an Entrusting Financial Instruments Business Operator, etc. as defined in Article 66-2, paragraph (1), item (iv) of the Act; the same applies hereinafter) incidentally with a margin transaction;
(b)intermediation for loans of money or Securities to customers which are made by an Entrusting Financial Instruments Business Operator, etc. as a business set forth in Article 35, paragraph (1) of the Act;
(iii)a case in which a Registered Financial Institution which is a Financial Institution engaged in Trust Business carries out the following acts:
(a)the lending of money or Securities to customers; and
(b)intermediation or agency for the lending of money or Securities to customers, performed by other Financial Institutions (limited to Banks, cooperative financial institutions, the Shoko Chukin Bank Limited, Insurance Companies or securities finance companies);
(iv)a case in which a Financial Instruments Business Operator that is a financial service intermediary engages in intermediation for loans of money or Securities to customers which are made by the counterparty financial institution (meaning the counterparty to a specified financial service contract (meaning the specified financial service contract prescribed in Article 31, paragraph (2) of the Act on the Provision of Financial Services; the same applies in Article 18-4-15, paragraph (5)) concluded by a customer through the securities, etc. intermediary business operations carried out by a financial service intermediary; the same applies in Article 16-13, item (v)), as the services prescribed in Article 35, paragraph (1) of the Act; and
(v)any case specified by Cabinet Office Order as being equivalent to the cases set forth in the preceding items.
(Persons That May Entrust the Authority for Investment)
Article 16-12The persons specified by Cabinet Order that are provided for in Article 42-3, paragraph (1) of the Act are the following persons:
(i)another Financial Instruments Business Operator, etc. (limited to one engaged in an Investment Management Business); and
(ii)a corporation established in accordance with the laws and regulations of a foreign state that engages in an Investment Management Business in a foreign state (with regard to the Categories of Businesses, referred to in Article 29-2, paragraph (1), item (v) of the Act, which are not Investment Advisory and Agency Business, excluding those that have obtained the registration under Article 29 of the Act).
(Exemptions to the Prohibition on Loans of Money or Securities with Regard to Investment Management Business)
Article 16-13The cases specified by Cabinet Order that are provided for in the proviso to Article 42-6 of the Act are the following cases:
(i)a case in which a Financial Instruments Business Operator, etc. provides intermediation or agency for loans of money or Securities to customers which are made by another Financial Instruments Business Operator incidentally with a margin transaction;
(ii)a case in which a Financial Instruments Business Operator (limited to one engaged in a Type I Financial Instruments Business) carries out the following acts:
(a)the loaning of money or Securities to customers as a business set forth in Article 35, paragraph (1) of the Act (excluding those incidental to a margin transaction; the same applies in (b) of this item, (b) of the following item, and item (v));
(b)intermediation or agency for loans of money or Securities to customers which are made by another Financial Instruments Business Operator as a business set forth in Article 35, paragraph (1) of the Act;
(iii)a case in which a Financial Instruments Business Operator that is a Financial Instruments Intermediary Service Provider carries out the following acts (excluding the cases set forth in item (i)):
(a)intermediation or agency for loans of money or Securities to customers which are made by an Entrusting Financial Instruments Business Operator, etc. incidentally with a margin transaction;
(b)intermediation for loans of money or Securities to customers which are made by an Entrusting Financial Instruments Business Operator, etc. as a business set forth in Article 35, paragraph (1) of the Act;
(iv)a case in which a Registered Financial Institution which is a Financial Institution engaged in Trust Business carries out the following acts:
(a)loaning money or Securities to customers;
(b)intermediation or agency for loans of money or Securities to customers which are made by a Financial Instruments Business Operator incidentally with a margin transaction; and
(c)intermediation or agency for loan of money or Securities to customers which are made by other Financial Institutions (limited to Banks, cooperative financial institutions, the Shoko Chukin Bank Limited, Insurance Companies, or securities finance companies);
(v)a case in which a Financial Instruments Business Operator that is a financial service intermediary engages in intermediation for loans of money or Securities to customers which are made by the counterparty financial institution, as the services prescribed in Article 35, paragraph (1) of the Act; and
(vi)any case specified by Cabinet Office Order as being equivalent to the cases set forth in the preceding items.
(Number of Rights Holders Entitled to Investment Property Not Requiring the Submission of an Investment Report)
Article 16-14The number specified by Cabinet Order that is provided for in the proviso to Article 42-7, paragraph (3) of the Act is 499.
(Securities-Related Transactions Excluded as the Subject of Separate Management)
Article 16-15The transactions specified by Cabinet Order that are provided for in Article 43-2, paragraph (1), item (ii) of the Act are transactions falling under the category of transactions designated by the Commissioner of the Financial Services Agency as being similar to Over-the-Counter Derivatives Transactions.
(Order for Public Notice of Business Reports)
Article 16-16The order under Article 46-3, paragraph (3) and Article 48-2, paragraph (3) of the Act is to be given by providing that public notice under these provisions is required to be published in a daily newspaper that publishes information on current affairs.
(Period Until the Commencement of Public Inspection of Explanatory Documents)
Article 16-17The period specified by Cabinet Order that is provided for in the provisions of Article 46-4 of the Act and Article 47-3 of the Act is four months; provided, however, that if a Financial Instruments Business Operator that is a foreign corporation or an individual domiciled in a foreign state is found to be unable to keep its Explanatory Documents (meaning the Explanatory Documents set forth in Article 46-4 of the Act or Article 47-3 of the Act) and provide them for public inspection or disclose them using the Internet or through other means pursuant to the provisions of Cabinet Office Order as prescribed in Article 46-4 or Article 47-3 of the Act from the day on which four months have elapsed from the end of its business year due to the laws and regulations or practices in its state, that period is the period approved by the Commissioner of the Financial Services Agency pursuant to the provisions of Cabinet Office Order.
(Special Rules on the Deadline for Submission of Business Reports by a Foreign Corporation)
Article 16-18The period specified by Cabinet Order that is provided for in Article 46-3, paragraph (1) of the Act as applied pursuant to the provisions of Article 49, paragraph (1) of the Act following the deemed replacement of terms or in Article 47-2 and Article 48-2, paragraph (1) of the Act as applied pursuant to the provisions of Article 49, paragraph (3) of the Act following the deemed replacement of terms is three months; provided, however, that if a Financial Instruments Business Operator that is a foreign corporation or an individual domiciled in a foreign state or a Registered Financial Institution which is a foreign corporation is found to be unable to submit the Business Reports within the three months after the end of its business year due to the laws and regulations or practices in its state, that period is the period approved by the Commissioner of the Financial Services Agency pursuant to the provisions of Cabinet Office Order.
(Deadline for Submission of Other Documents)
Article 16-19The period specified by Cabinet Order that is provided for in Article 49-3, paragraph (1) of the Act is three months; provided, however, that if a Financial Instruments Business Operator set forth in Article 49-3, paragraph (1) of the Act is found to be unable to submit the documents referred to in that paragraph within three months after the end of its business year due to the laws and regulations or practices in its state, that period is the period approved by the Commissioner of the Financial Services Agency pursuant to the provisions of Cabinet Office Order.
(Assets to Be Retained in Japan)
Article 16-20The liabilities on the accounts of All Business Offices or Offices that are specified by Cabinet Order as provided for in Article 49-5 of the Act are those of these liabilities that are other than obligations toward the head office of the Financial Instruments Business Operator set forth in that Article or any other Non-Resident.
(Deemed Replacement of Terms in the Provisions of the Companies Act as Applied Mutatis Mutandis If a Financial Instruments Business Operator Gives Public Notice of the Discontinuation of Financial Instruments Business by Way of Electronic Public Notice)
Article 17If public notice under Article 50-2, paragraph (6) of the Act is given by way of Electronic Public Notice (meaning the Electronic Public Notice prescribed in Article 2, item (xxxiv) of the Companies Act; the same applies hereinafter), the deemed replacement of terms under Article 50-2, paragraphs (9) and (10) of the Act when the provisions of the Companies Act are applied mutatis mutandis pursuant to Article 50-2, paragraphs (9) and (10) of the Act is as given in the following table:
Provisions of the Companies Act whose terms are deemed to be replaced
Original Terms
Terms deemed to replace the original terms
Article 940, paragraph (3) (excluding the items)
the preceding two paragraphs
paragraph (1)
these provisions
the provisions of that paragraph
(Assets for Which Retention in Japan May Be Ordered)
Article 17-2-1The portion of the assets specified by Cabinet Order that is provided for in Article 56-3 of the Act is the amount of the stated capital equivalent to the amount of liability calculated pursuant to the provisions of Cabinet Office Order.
(Base Amount of Total Assets Requiring Notification Regarding a Special Financial Instruments Business Operator)
Article 17-2-2The amount specified by Cabinet Order that is provided for in Article 57-2, paragraph (1) of the Act is 1 trillion yen.
(Deadline for Submission of Documents Related to the Parent Company of a Special Financial Instruments Business Operator)
Article 17-2-3(1)The period specified by Cabinet Order that is provided for in Article 57-2, paragraph (2) of the Act is one month (three months in the case of Quarterly Securities Reports and any other documents set forth in item (ii) of that paragraph that are specified by Cabinet Office Order as documents that are difficult to submit within that period); provided, however, that if the Parent Company (meaning the Parent Company prescribed in paragraph (8) of that Article; hereinafter the same applies in this Chapter) of a Special Financial Instruments Business Operator (meaning a Special Financial Instruments Business Operator prescribed in that paragraph; the same applies hereinafter) is a foreign company, and the Special Financial Instruments Business Operator is found to be unable to submit the documents within three months after the Notification Date (meaning the Notification Date prescribed in paragraph (2) of that Article; the same applies in the following paragraph) due to the laws and regulations or practices in the state of the Parent Company or any other compelling reason, that period is the period approved by the Commissioner of the Financial Services Agency pursuant to the provisions of Cabinet Office Order.
(2)The period specified by Cabinet Order that is provided for in Article 57-2, paragraph (3) of the Act is one month (three months in the case of Quarterly Securities Reports and any other documents set forth in paragraph (2), item (ii) of that Article that are specified by Cabinet Office Order as documents that are difficult to submit within that period); provided, however, that if the Parent Company of a Special Financial Instruments Business Operator is a foreign company, and the Special Financial Instruments Business Operator is found to be unable to submit those documents within three months after the date on which the Parent Company became its Parent Company on or after the Notification Date due to the laws and regulations or practices in the state of the Parent Company or any other compelling reason, that period is the period approved by the Commissioner of the Financial Services Agency pursuant to the provisions of Cabinet Office Order.
(3)The period specified by Cabinet Order that is provided for in Article 57-2, paragraph (5) of the Act is one month (three months in the case of Quarterly Securities Reports and any other documents that are specified by Cabinet Office Order as documents that are difficult to submit within that period); provided, however, that if the Parent Company of a Special Financial Instruments Business Operator is a foreign company, and the Special Financial Instruments Business Operator is found to be unable to submit those documents within three months after the end of the quarter (meaning the quarter prescribed in Article 46-6, paragraph (3) of the Act) due to the laws and regulations or practices in the state of the Parent Company or any other compelling reason, that period is the period approved by the Commissioner of the Financial Services Agency pursuant to the provisions of Cabinet Office Order.
(Scope of Subsidiary Corporations of a Special Financial Instruments Business Operator)
Article 17-2-4Persons that satisfy the requirements specified by Cabinet Order that are provided for in Article 57-2, paragraph (9) of the Act are the persons set forth in the items of Article 15-16-2, paragraph (1).
(Transitional Period Related to Submission of Business Reports of a Special Financial Instruments Business Operator)
Article 17-2-5(1)The period specified by Cabinet Order that is provided for in Article 57-3, paragraph (1) of the Act is one month.
(2)The order under the provisions of Article 57-3, paragraph (3) of the Act is to be given by providing that public notice under those provisions is required to be published in a daily newspaper that publishes information on current affairs.
(Transitional Period Related to Preparation and Public Inspection of Explanatory Documents of a Special Financial Instruments Business Operator)
Article 17-2-6(1)The period specified by Cabinet Order from the Notification Date that is provided for in Article 57-4 of the Act is one month.
(2)The period specified by Cabinet Order from the end of each business year prescribed in Article 57-4 of the Act is four months.
(Transitional Period Related to Notification of Documents Describing Status of Soundness in Management of a Special Financial Instruments Business Operator)
Article 17-2-7(1)The period specified by Cabinet Order that is provided for in Article 57-5, paragraph (2) of the Act is one month.
(2)The period specified by Cabinet Order from the Notification Date that is provided for in Article 57-5, paragraph (3) of the Act is one month.
(3)The period specified by Cabinet Order from the end of the quarter that is provided for in Article 57-5, paragraph (3) of the Act is two months.
(Deadline for Submission of Documents by a Designated Parent Company)
Article 17-2-8The period specified by Cabinet Order that is provided for in Article 57-13, paragraph (1) of the Act is one month.
(Transitional Period Related to Submission of Business Reports of an Ultimate Designated Parent Company)
Article 17-2-9(1)The period specified by Cabinet Order that is provided for in Article 57-15, paragraph (1) of the Act is one month.
(2)The order under the provisions of Article 57-15, paragraph (3) of the Act is to be given by providing that public notice under those provisions is required to be published in a daily newspaper that publishes information on current affairs.
(Transitional Period Related to Preparation and Public Inspection of Explanatory Documents of Ultimate Designated Parent Company)
Article 17-2-10(1)The period specified by Cabinet Order from the day on which the company became an Ultimate Designated Parent Company that is provided for in Article 57-16 of the Act is one month.
(2)The period specified by Cabinet Order from the end of each business year prescribed in Article 57-16 of the Act is four months; provided, however, that if an Ultimate Designated Parent Company (meaning an Ultimate Designated Parent Company prescribed in Article 57-12, paragraph (3) of the Act; hereinafter the same applies in paragraph (3) of the following Article and Article 17-2-12, paragraph (2)) that is a foreign company is found to be unable to keep the Explanatory Documents set forth in Article 57-16 of the Act and provide them for public inspection or disclose them using the Internet or through other means pursuant to the provisions of Cabinet Office Order as prescribed in that Article from the day on which four months have elapsed from the end of its business year due to the laws and regulations or practices in its state or any other compelling reasons, that period is the period approved by the Commissioner of the Financial Services Agency pursuant to the provisions of Cabinet Office Order.
(Transitional Period Related to Notification of Documents Describing the Integrity of Management of an Ultimate Designated Parent Company)
Article 17-2-11(1)The period specified by Cabinet Order that is provided for in Article 57-17, paragraph (2) of the Act is one month.
(2)The period specified by Cabinet Order from the day on which the company became an Ultimate Designated Parent Company prescribed in Article 57-17, paragraph (3) of the Act is one month.
(3)The period specified by Cabinet Order from the end of the Highest Designated Parent Company Quarter, referred to in Article 57-17, paragraph (3) of the Act, is four months; provided, however, that if an Ultimate Designated Parent Company that is a foreign company is found to be unable to keep the documents set forth in paragraph (3) of that Article and provide them for public inspection from the day on which four months have elapsed from the end of the Highest Designated Parent Company Quarter prescribed in paragraph (2) of that Article due to the laws and regulations or practices in its state or any other compelling reasons, that period is the period approved by the Commissioner of the Financial Services Agency pursuant to the provisions of Cabinet Office Order.
(Deemed Replacement of Terms for Application of the Provisions of the Act to a Foreign Company)
Article 17-2-12(1)If the Parent Company of a Special Financial Instruments Business Operator is a foreign company, the deemed replacement of terms under the provisions of Article 57-27 of the Act is as given in the following table:
Provisions of the Act whose terms are deemed to be replaced
Original terms
Terms deemed to replace the original terms
Article 57-13, paragraph (2), item (ii)
the articles of incorporation, certificate of registered matters,
the articles of incorporation, certificate of registered matters (including documents equivalent thereto), certificate of registered matters of the principal business office or office in Japan
Article 57-18, paragraph (1), item (ii)
when an application for commencement of bankruptcy proceedings, rehabilitation proceedings, or reorganization proceedings has been filed
when a petition for commencement of bankruptcy proceedings, rehabilitation proceedings, reorganization proceedings, or liquidation has been filed in Japan or an application of the same kind has been filed in a State where its head office or principal business office is located based on the laws and regulations of that State
Article 57-18, paragraph (2), item (ii)
the officer that represented the Designated Parent Company
the officer of a Designated Parent Company
Article 57-18, paragraph (2), item (iii)
has dissolved upon decision of commencement of bankruptcy proceedings
has become subject to a ruling for the commencement of bankruptcy proceedings, or has commenced procedures for the same kind of bankruptcy proceedings in a State where its head office or principal business office is located based on the laws and regulations of that State.
the bankruptcy trustee thereof
the bankruptcy trustee thereof or the person equivalent to a bankruptcy trustee in that State
Article 57-18, paragraph (2), item (iv)
the liquidator thereof
the liquidator thereof or the person equivalent to a liquidator in the State where its head office or principal business office is located
(2)With regard to the application of the provisions of Article 57-15, paragraph (1) of the Act to cases in which an Ultimate Designated Parent Company is a foreign company, the term "within three months" in that paragraph is deemed to be replaced with "within three months (within the period approved by the Commissioner of the Financial Services Agency pursuant to the provisions of Cabinet Office Order if the Ultimate Designated Parent Company is found to be unable to submit its Business Reports within three months after the end of its business year due to the laws and regulations or practices in its state or any other compelling reason)".
(Cases in Which Acts Related to Securities Services May Be Conducted with a Person in Japan)
Article 17-3The cases specified by Cabinet Order that are provided for in the proviso to Article 58-2 of the Act are the following cases (excluding cases in which, with regard to Securities for Professional Investors, the acts set forth in Article 2, paragraph (8), items (i) to (iv) or item (x) of the Act are to be carried out with General Investors (meaning General Investors as defined in Article 40-4 of the Act; hereinafter the same applies in this Article) (excluding a case in which disclosure has been made with regard to the Securities for Professional Investors, a case in which intermediation for a sale on behalf of the General Investors not based on a solicitation for General Investors is made, or any other cases specified by Cabinet Office Order as being less likely to result in insufficient protection of investors) and cases in which the Foreign Securities Services Provider carries out Specified Over-the-Counter Derivatives Transactions or intermediation, brokerage (excluding Brokerage for the Clearing of Securities, etc.), or agency therefor using an electronic data processing system that it uses for its business of Over-the-Counter Derivatives Transactions, etc.):
(i)a case in which a Foreign Securities Services Provider carries out the following acts from a foreign state:
(a)the acts set forth in the items of Article 28, paragraph (8) of the Act carried out with the government or the Bank of Japan;
(b)acts set forth in the items of Article 28, paragraph (8) of the Act carried out with, among the Financial Institutions (meaning banks, cooperative financial institutions, and financial institutions set forth in the items of Article 1-9; hereinafter the same applies in this Article), those specified by Cabinet Office Order, or a Trust Company (meaning persons that have obtained the license under Article 3 or Article 53, paragraph (1) of the Trust Business Act (Act No. 154 of 2004)), and which are related to the purchase and sale of Securities or Transactions of Securities-Related Derivatives conducted by those persons for the purpose of investment or on the account of a person that has created a trust under a trust contract;
(c)the acts set forth in the items of Article 28, paragraph (8) of the Act carried out with, among Financial Instruments Business Operators, those engaged in an Investment Management Business and which are related to the Investment Management Business conducted thereby;
(d)the acts set forth in the items of Article 28, paragraph (8) of the Act carried out with, among Financial Institutions, those specified by Cabinet Office Order, which are acts specified in Article 33, paragraph (2), items (i) to (v) of the Act as relating to the Securities or transactions set forth in these items;
(e)among the acts set forth in the items of Article 28, paragraph (8) of the Act carried out with, among Financial Institutions, those specified by Cabinet Office Order, wherein the Financial Institutions carry out the purchase and sale of Securities, or the acts set forth in Article 28, paragraph (8), item (iii) or (v) of the Act on a customer's account on receiving the customer's written orders (excluding acts carried out based on the solicitation to a customer concerning the orders and acts carried out on receiving orders from the customer concerning the Financial Institutions' Investment Advisory Business), the acts which are related to those specified by Cabinet Office Order;
(f)the acts set forth in the items of Article 28, paragraph (8) of the Act carried out with a Long-Term Credit Bank (meaning those that have obtained a license from the Prime Minister pursuant to Article 4, paragraph (1) of the Long-Term Credit Bank Act (Act No. 187 of 1952)), an ordinary bank as set forth in Article 8, paragraph (1) of the Act on Financial Institutions' Merger and Conversion (Act No. 86 of 1968) (including as applied mutatis mutandis pursuant to Article 55, paragraph (4) of that Act; hereinafter the same applies in this item) which has been authorized under Article 8, paragraph (1) of that Act (including an ordinary bank as set forth in Article 17-2, paragraph (1) of the Act on Financial Institutions' Merger and Conversion prior to the amendment under Article 168 of the Supplementary Provisions of the Act on Development, etc. of Relevant Acts for Financial System Reform (Act No. 107 of 1998) which remains effective pursuant to the provisions of Article 169 of the Supplementary Provisions of that Act (hereinafter referred to as the "Merger and Conversion Act Prior to the Amendment in 1998" in this item) (including cases in which Article 17-2, paragraph (1) of the Merger and Conversion Act Prior to the Amendment in 1998 is applied mutatis mutandis pursuant to Article 24, paragraph (1) of that Act; hereinafter the same applies in this item), which has been authorized under Article 17-2, paragraph (1) of that Act, and if a merger or conversion is to be effected for which a written merger agreement or written conversion agreement has been prepared pursuant to the provisions of the Act on a Financial Institutions' Merger and Conversion prior to the amendment under Article 199 of the Act on Arrangement of Relevant Acts Incidental to Enforcement of the Companies Act (Act No. 87 of 2005; hereinafter referred to as the "Preparation Act for the Companies Act" in this item) which are to remain applicable pursuant to the provisions of Article 200, paragraph (1) of the Preparation Act for the Companies Act (hereinafter referred to as the "Merger and Conversion Act Prior to the Amendment in 2005" in this item) (including if Article 17-2, paragraph (1) of that Act is applied mutatis mutandis pursuant to Article 24, paragraph (1) of that Act; hereinafter the same applies in this item), an ordinary bank authorized under Article 17-2, paragraph (1) of that Act) or a Trust Company, etc. (meaning a Trust Company, etc. as prescribed in Article 3, paragraph (1) of the Trust Loan Act (Act No. 195 of 1952)), which are related to the long-term credit bank bonds issued under Article 8 or Article 9 of the Long-Term Credit Bank Act, the specified corporate bonds issued pursuant to Article 8 of the Act on Financial Institutions' Merger and Conversion, or the beneficiary certificates prescribed in Article 2, paragraph (2) of the Trust Loan Act respectively;
(ii)a case in which a Foreign Securities Services Provider carries out the following acts from a foreign state without making solicitation for the acts set forth in the items of Article 28, paragraph (8) of the Act (excluding the cases which fall under the preceding item):
(a)at the order of a person in Japan, among the acts set forth in Article 28, paragraph (8), items (i) to (iii) or item (v) of the Act or the acts set forth in item (vi) of that paragraph (excluding intermediation, brokerage, or agency as set forth in item (iv) of that paragraph) carried out with the person as the counterparty, those specified by Cabinet Office Order, or the acts set forth in Article 28, paragraph (8), item (iv) of the Act or the acts set forth in item (vi) of that paragraph (excluding intermediation, brokerage, and agency set forth in item (iv) of that paragraph) carried out with the person (limited to one that falls under either of (a) or (b) of Article 1-8-6, paragraph (1), item (ii)) as the counterparty;
(b)through the agency or intermediation performed by a Financial Instruments Business Operator engaged in Securities Services (limited to one that has obtained the registration under Article 29 of the Act to conduct a Type 1 Financial Instruments Business), a purchase and sale of Securities or an act as set forth in Article 28, paragraph (8), item (iii) or (v) of the Act that is as specified by Cabinet Office Order carried out with a person in Japan as the counterparty thereto, or the acts set forth in Article 28, paragraph (8), item (iv) of the Act carried out with a person in Japan (limited to those that fall under either of (a) or (b) of Article 1-8-6, paragraph (1)) as the counterparty;
(iii)a case in which a Foreign Securities Services Provider, pursuant to the provisions of Cabinet Office Order, holds a discussion solely for fixing the contents of an Underwriting Contract (meaning any of the following contracts concluded through public offering, private placement, or secondary distribution of Securities or Solicitation for selling, etc. Only for Professional Investors; the same applies in the following Article), among its business of underwriting of Securities, with the issuer or holder of the Securities involved in the Underwriting Contract in Japan (excluding cases in which the secondary distribution of Securities, Solicitation for selling, etc. Only for Professional Investors, or the dealing in Public Offering, Private Placement, or Secondary Distribution of the Securities or dealing in Solicitation for selling, etc. Only for Professional Investors is made in Japan):
(a)a contract wherein the relevant party is to acquire the Securities in whole or in part from the issuer or the holder of the Securities for the purpose of having the Securities be acquired by other persons;
(b)a contract wherein, if there are no persons to acquire the Securities in whole or in part, the relevant party is to acquire the remaining Securities from the issuer or holder of the Securities; and
(c)a contract wherein, if the Securities are share option certificates and the person that has acquired them does not exercise the share options associated with all or some of them, the relevant party is to acquire the share option certificates associated with the unexercised share options from the issuer or holder thereof and that party or a third party is to exercise those share options.
(Among the Underwriting Activities, Acts Requiring Permission)
Article 17-4The acts specified by Cabinet Order that are provided for in Article 59, paragraph (1) of the Act are, if the Foreign Securities Services Provider does not hold a discussion for fixing the contents of an Underwriting Contract with the issuer or holder of the Securities involved in the Underwriting Contract, and does not conduct the secondary distribution of the Securities, Solicitation for selling, etc. Only for Professional Investors or the dealing in Public Offering, Private Placement, or Secondary Distribution of the Securities or the dealing in Solicitation for selling, etc. Only for Professional Investors in Japan, the participation in that Underwriting Contract.
(Calculation of the Amount of Stated Capital or the Total Amount of Investment)
Article 17-5The amount of stated capital or the total amount of investment set forth in Article 59-2, paragraph (2) and Article 60-2, paragraph (2) of the Act (including as applied mutatis mutandis pursuant to Article 60-14, paragraph (2) of the Act) is to be calculated by adding up the total issue value of the Issued Shares (excluding the amount, from among its issue value, which it has been decided will not be recorded as the amount of stated capital) and the amount recorded as the amount of stated capital by reducing the amount of reserve funds without issuing shares (including the amount equivalent to such an amount).
(Years of Experience in Underwriting Activities)
Article 17-6(1)The period specified by Cabinet Order that is provided for in Article 59-3, item (i) of the Act is three years.
(2)The period referred to in the preceding paragraph is calculated by deeming the period in which the following persons have been performing the same type of activities as Underwriting Activities (meaning Underwriting Activities as set forth in Article 59, paragraph (1) of the Act; hereinafter the same applies in this Article) in a foreign state to be the period in which the applicant for permission has performed the same type of activities as Underwriting Activities:
(i)a person merged or consolidated with or into the applicant for permission;
(ii)a person that has had the applicant for permission assume activities involving operations of the same type as its Underwriting Activities in whole or in part through a split;
(iii)a person that has transferred business involving activities of the same type as its Underwriting Activities in whole or in part to the applicant for permission;
(iv)a person that holds all the Issued Shares or equity in investment of the applicant for permission; and
(v)any other person specified by Cabinet Office Order as being equivalent to the persons set forth in the preceding items.
(Minimum Amount of Stated Capital for Underwriting Activities)
Article 17-7(1)The amount specified by Cabinet Order that is provided for in Article 59-3, item (ii) of the Act is 500 million yen.
(2)If the amount of stated capital or the total amount of investment set forth in Article 59-3, item (ii) of the Act is to be converted into Japanese currency, the conversion is to be made using the Exchange Rate at the time of the application for permission.
(Years of Experience for On-Exchange Transaction Services)
Article 17-8(1)The period specified by Cabinet Order that is provided for in Article 60-3, paragraph (1), item (i), (c) of the Act is three years.
(2)The cases specified by Cabinet Order that are provided for in Article 60-3, paragraph (1), item (i), (c) of the Act means, if the relevant period has been calculated by deeming a period during which one of the following persons performed the same type of services as On-Exchange Transaction Services (meaning On-Exchange Transaction Services as defined in Article 60, paragraph (1) of the Act; hereinafter the same applies in this Article) to be a period during which the applicant for permission performed the same type of operations as On-Exchange Transaction Services, a case in which that period is three continuous years or more:
(i)a person found to have reorganized into an applicant for permission or a company merged with or consolidated into the applicant for permission;
(ii)a person that has had the applicant for permission assume business involving operations of the same type as On-Exchange Transaction Services in whole or in part through a split;
(iii)a person that has transferred business involving operations of the same type as the On-Exchange Transaction Services in whole or in part to the applicant for permission; and
(iv)a person that holds all the Issued Shares of the applicant for permission.
(Minimum Amount of Stated Capital For an On-Exchange Transaction Services)
Article 17-9(1)The amount specified by Cabinet Order that is provided for in Article 60-3, paragraph (1), item (i), (e) of the Act is 50 million yen.
(2)If the amount of stated capital referred to in Article 60-3, paragraph (1), item (i), (e) of the Act is to be converted into Japanese currency, the conversion is to be made using the Exchange Rate at the time of the application for permission.
(Deadline for Submission of Business Reports Related to On-Exchange Transaction Services)
Article 17-10(1)The period specified by Cabinet Order that is provided for in Article 46-3, paragraph (1) of the Act as applied mutatis mutandis pursuant to Article 60-6 of the Act (including as applied mutatis mutandis pursuant to Article 60-14, paragraph (2) of the Act) following the deemed replacement of terms is three months; provided, however, that if the Authorized Firm for On-Exchange Transactions or the Business Operator authorized to conduct electronic over-the-counter derivatives transactions, etc. Business Operator is found to be unable to submit the business reports within three months after the end of its business year due to the laws and regulations or practices in its state, that period is the period approved by the Commissioner of the Financial Services Agency pursuant to the provisions of Cabinet Office Order.
(2)The order under Article 46-3, paragraph (3) of the Act as applied mutatis mutandis pursuant to Article 60-6 of the Act (including as applied mutatis mutandis pursuant to Article 60-14, paragraph (2) of the Act) is to be given by providing that public notice under these provisions is required to be published in a daily newspaper that publishes information on current affairs.
(3)The period specified by Cabinet Order that is provided for in Article 49-3, paragraph (1) of the Act as applied mutatis mutandis pursuant to Article 60-6 of the Act (including as applied mutatis mutandis pursuant to Article 60-14, paragraph (2) of the Act) is three months; provided, however, that if the Authorized Firm for On-Exchange Transactions or the Business Operator authorized to conduct electronic over-the-counter derivatives transactions, etc. Business Operator is found to be unable to submit the documents set forth in Article 49-3, paragraph (1) of the Act within three months after the end of its business year due to the laws and regulations or practices in its state, that period is the period approved by the Commissioner of the Financial Services Agency pursuant to the provisions of Cabinet Office Order.
(Cases in Which Electronic Over-the-Counter Derivatives Transactions Business Is Allowed)
Article 17-10-2The cases specified by Cabinet Order that are provided for in Article 60-14, paragraph (1) of the Act are cases in which a person as set forth in Article 1-8-6, paragraph (1), item (ii), (a) or (b) (excluding a person engaged in Securities Services) is the counterparty.
(Deemed Replacement of Terms in Connection with Electronic Over-the-Counter Derivatives Transactions Business)
Article 17-10-3The deemed replacement of terms under Article 60-14, paragraph (2) of the Act is as given in the following table:
Provisions of the Act whose terms are deemed to be replaced
Original terms
Terms deemed to replace the original terms
Article 60, paragraph (2)
the preceding paragraph
Article 60-14, paragraph (1)
Article 60-2, paragraph (1)
paragraph (1) of the preceding Article
Article 60-14, paragraph (1)
On-Exchange Transaction Office
Electronic Over-the-Counter Derivatives Transactions, etc. Office
Article 60-2, paragraph (3), item (i)
paragraph (1), item (i), items (a) to (h), or item (j) of the following Article
paragraph (1), item (i), items (a) to (c), items (e) to (h), or item (j) of the following Article
Article 60-2, paragraph (3), item (ii)
On-Exchange Transaction Office
Electronic Over-the-Counter Derivatives Transactions, etc. Office
Article 60-3, paragraph (1), item (i)
On-Exchange Transaction Office
Electronic Over-the-Counter Derivatives Transactions, etc. Office
as the On-Exchange Transaction
as the Electronic Over-the-Counter Derivatives Transactions, etc.
Article 60-3, paragraph (1), item (ii)
On-Exchange Transaction Office
Electronic Over-the-Counter Derivatives Transactions, etc. Office
Article 60-3, paragraphs (2) and (3)
Article 60, paragraph (1)
Article 60-14, paragraph (1)
Article 60-5, paragraph (1)
the items of Article 60-2, paragraph (1)
the items of Article 60-2, paragraph (1) (excluding items (iv), (vii), and (x))
Article 60-7
Article 60, paragraph (1)
Article 60-14, paragraph (1)
Article 60-8, paragraph (1)
Article 60, paragraph (1)
Article 60-14, paragraph (1)
Article 60-3, paragraph (1), item (i) (excluding (c) and (j)), (ii) or (iii))
Article 60-3, paragraph (1), item (i) (excluding (c), (d), and (j)) or (ii)
Article 60-8, paragraph (3) and Article 60-9, paragraph (1)
Article 60, paragraph (1)
Article 60-14, paragraph (1)
Article 60-10
completing On-Exchange Transactions
completing Electronic Over-the-Counter Derivatives Transactions, etc.
Article 60, paragraph (1)
Article 60-14, paragraph (1)
Article 60-12, paragraph (1)
Article 60, paragraph (1)
Article 60-14, paragraph (1)
(Years of Experience in Electronic Over-the-Counter Derivatives Transactions Business)
Article 17-10-4(1)The period specified by Cabinet Order that is provided for in Article 60-3, paragraph (1), item (i), (c) of the Act as applied mutatis mutandis pursuant to Article 60-14, paragraph (2) of the Act is one year.
(2)The cases specified by Cabinet Order that are provided for in Article 60-3, paragraph (1), item (i), (c) of the Act as applied mutatis mutandis pursuant to Article 60-14, paragraph (2) of the Act mean, if the relevant period has been calculated by deeming a period during which one of the following persons has performed the same type of operations as Electronic Over-the-Counter Derivatives Transactions, etc. Business (meaning the Electronic Over-the-Counter Derivatives Transactions, etc. Business prescribed in Article 60-14, paragraph (1) of the Act; hereinafter the same applies in this paragraph) to be a period during which the applicant for permission has performed the same type of operations as Electronic Over-the-Counter Derivatives Transactions, etc. Business, a case in which that period is one continuous year or more:
(i)a person found to have reorganized into an applicant for permission or a company merged with or consolidated into the applicant for permission;
(ii)a person that has had the applicant for permission assume business involving operations of the same type as an Electronic Over-the-Counter Derivatives Transactions, etc. Business in whole or in part through a company split;
(iii)a person that has transferred business involving operations of the same type as Electronic Over-the-Counter Derivatives Transactions, etc. Business in whole or in part to the applicant for permission; and
(iv)a person that holds all the Issued Shares of the applicant for permission.
(Minimum Amount of Stated Capital for Electronic Over-the-Counter Derivatives Transactions Business)
Article 17-10-5(1)The amount specified by Cabinet Order that is provided for in Article 60-3, paragraph (1), item (i), (e) of the Act as applied mutatis mutandis pursuant to Article 60-14, paragraph (2) of the Act is 300 million yen.
(2)If the amount of stated capital referred to in Article 60-3, paragraph (1), item (i), (e) of the Act as applied mutatis mutandis pursuant to Article 60-14, paragraph (2) of the Act is to be converted into Japanese currency, the conversion is to be made by using the Exchange Rate at the time of the application for permission.
(Persons That May Be a Counterparty of the Persons Engaged in Investment Advisory Business or Investment Management Business in a Foreign State)
Article 17-11(1)The persons specified by Cabinet Order that are provided for in Article 61, paragraphs (1) and (3) of the Act are Registered Financial Institutions which are engaged in Investment Management Business.
(2)The persons specified by Cabinet Order that are provided for in Article 61, paragraph (2) of the Act are Financial Instruments Business Operators that are engaged in Investment Management Business (excluding a business under a Discretionary Investment Contract that performs the acts set forth in Article 2, paragraph (8), item (xii) of the Act) and the person prescribed in the preceding paragraph.
(Specially Permitted Services for Qualified Institutional Investors)
Article 17-12(1)The persons other than a Qualified Institutional Investor specified by Cabinet Order that are provided for in Article 63, paragraph (1), item (i) of the Act are persons other than a Qualified Institutional Investor that fall under any of the following items at the time when they become the counterparty to a Private Placement or handling of a Private Placement involving the rights set forth in Article 2, paragraph (2), item (v) or (vi) of the Act which they acquire:
(i)the State;
(ii)the Bank of Japan;
(iii)a local government;
(iv)a Financial Instruments Business Operator, etc.;
(v)a person that, on a regular basis, conducts Private Placements involving the rights set forth in Article 2, paragraph (2), item (v) or (vi) of the Act or conducts the act set forth in paragraph (8), item (xv) of that Article with regard to the money or any other property invested or contributed by a person that holds the rights set forth in paragraph (2), item (v) or (vi) of that Article;
(vi)a person specified by Cabinet Office Order as a person having a close relationship with the person set forth in the preceding item;
(vii)a company that is an issuer of share certificates listed on a Financial Instruments Exchange;
(viii)a corporation whose amount of stated capital is 50 million yen or more;
(ix)a corporation whose amount of net assets (meaning the amount obtained by deducting the amount of liabilities from the amount of assets on the balance sheet) is 50 million yen or more;
(x)a corporation established by a special act of establishment pursuant to the provisions of Special Acts;
(xi)the specified purpose company prescribed in Article 2, paragraph (3) of the Asset Securitization Act;
(xii)a corporate pension fund that satisfies the requirements specified by Cabinet Office Order in consideration of financial status and other circumstances;
(xiii)a foreign corporation;
(xiv)an individual that satisfies the requirements specified by Cabinet Office Order in consideration of financial status and other circumstances; or
(xv)a person specified by Cabinet Office Order as being equivalent to the persons set forth in the preceding items.
(2)If the rights set forth in Article 2, paragraph (2), item (v) or (vi) of the Act satisfy the following requirements, notwithstanding the provisions of the preceding paragraph, the persons that are not Qualified Institutional Investors but that are specified by Cabinet Order as provided for in Article 63, paragraph (1), item (i) of the Act are persons as prescribed in the preceding paragraph and any person that is not a Qualified Institutional Investor but that is specified by Cabinet Office Order as a person that has knowledge and experience in investment:
(i)the business conducted by allocating money and other property invested or contributed by the persons holding the rights (hereinafter referred to as the "investors" in this paragraph) satisfies the following requirements:
(a)investments are made in share certificates and other Securities specified by Cabinet Office Order (limited to those that are not listed on a Financial Instruments Exchange at the time of making the investment, and excluding those specified by Cabinet Office Order) by allocating an amount exceeding 80 percent of the amount obtained by deducting the amount specified by Cabinet Office Order from the amount of the money and other property invested or contributed; and
(b)no borrowing of funds or guarantee of obligations is made, except in the case specified by Cabinet Office Order as a case that is found to have little likelihood of resulting in insufficient investor protection;
(ii)the money and other property cannot be returned at the request of investors, unless there is a compelling reason;
(iii)the contract connected with those rights provides for the particulars specified by Cabinet Office Order, referred to in Article 63, paragraph (9) of the Act; and
(iv)a document stating to the effect that the requirements set forth in the preceding three items are satisfied is delivered, or an electronic or magnetic record (meaning the electronic or magnetic record prescribed in Article 13, paragraph (5) of the Act; the same applies hereinafter) in which a statement to that effect is recorded is provided, to the investors by the time of conclusion of the contract connected with the rights.
(3)The number specified by Cabinet Order that is provided for in Article 63, paragraph (1), item (i) of the Act is 49.
(4)The Private Placement specified by Cabinet Order as being unlikely to cause persons other than a Qualified Institutional Investor acquire the rights, as provided in Article 63, paragraph (1), item (i) of the Act, is one that satisfies the requirements specified in the relevant of the following items for the category of case set forth in that item:
(i)if the acquirer responding to a solicitation for acquisition the rights is a Qualified Institutional Investor (limited to a person that does not fall under any of (a) to (c) of Article 63, paragraph (1), item (i) of the Act; hereinafter the same applies in this item and (a) of the following item): a restriction prohibiting the transfer of rights other than transfer to a Qualified Institutional Investor is imposed under the contract for the rights or by other juridical acts;
(ii)if the acquirer responding to a solicitation for acquisition the rights is an Investor Subject to Specially Permitted Services (meaning the person prescribed in paragraph (1) (in the case prescribed in paragraph (2), the person prescribed in that paragraph) that does not fall under any of Article 63, paragraph (1), item (i), (a) to (c) of the Act; the same applies in (a) and (b)): all of the following requirements:
(a)a restriction prohibiting the person that has acquired or purchased the rights from transferring them unless doing so all at once to another single Qualified Institutional Investor or Investor Subject to Specially Permitted Services is imposed under the contract of the rights or by other juridical acts; and
(b)if other rights specified by Cabinet Office Order as being of the same type as the relevant rights (these other rights are referred to as "Newly Issued Rights of the Same Type" in (b)) have been issued as Securities within six months prior to the day on which the relevant rights are to be issued as Securities, the total number of Investors Subject to Specially Permitted Services that acquire the relevant rights in response to the solicitation for acquisition them and the Investors Subject to Specially Permitted Services that have acquired Newly Issued Rights of the Same Type which have been issued within six months prior to the day on which the relevant rights are to be issued as Securities in response to the solicitation for acquisition thereof is 49 or less.
(5)What is specified by Cabinet Order as being similar to money, referred to in Article 63, paragraph (1), item (ii) of the Act, is anything that is set forth in the items of Article 1-3.
(Employee of a Notifier of Specially Permitted Services)
Article 17-13The employees specified by Cabinet Order that are provided for in Article 63, paragraph (2), item (iv), Article 63, paragraph (7), item (i), (c), and Article 63, paragraph (7), item (ii), (c) of the Act are an employee of a person that seeks to make the notification for the Specially Permitted Services for Qualified Institutional Investors, etc. (meaning Specially Permitted Services for Qualified Institutional Investors, etc. as prescribed in Article 63, paragraph (2) of the Act; hereinafter the same applies in this Article and the following Article) and that falls under any of the following items:
(i)a person that supervises the function of providing guidance to ensure that Laws and Regulations, etc. are observed with regard to Specially Permitted Services for Qualified Institutional Investors, etc., or any other persons specified by Cabinet Office Order as being equivalent thereto; or
(ii)a person that supervises the department conducting investments with regard to Specially Permitted Services for Qualified Institutional Investors, etc. and any other person specified by Cabinet Office Order as being equivalent thereto.
(Specially Permitted Services for Qualified Institutional Investors for Which It Is Particularly Necessary to Ensure the Protection of Investors)
Article 17-13-2The Specially Permitted Services for Qualified Institutional Investors, etc. specified by Cabinet Order that are provided for in Article 63, paragraph (9) of the Act (including as applied mutatis mutandis pursuant to Article 63-3, paragraph (2) of the Act) are Specially Permitted Services for Qualified Institutional Investors, etc. provided regarding the rights set forth in Article 2, paragraph (2), item (v) or (vi) of the Act with persons that are not Qualified Institutional Investors but that are specified by Cabinet Office Order as having knowledge and experience in investment, as prescribed in Article 17-12, paragraph (2) (limited to those that do not fall under any of Article 63, paragraph (1), item (i), (a) to (c) of the Act) as the counterparties.
(Special Rules on the Deadline for Submission of Business Reports by a Foreign Corporation)
Article 17-13-3The period specified by Cabinet Order that is provided for in Article 63-4, paragraph (2) of the Act (including as applied mutatis mutandis pursuant to Article 63-3, paragraph (2) of the Act) is three months; provided, however, that if a Notifier of Specially Permitted Services or a Financial Instruments Business Operator, etc. that is a foreign corporation or an individual domiciled in a foreign state is found to be unable to submit the Business Reports within the three months after the end of its business year due to the laws and regulations or practices in its state, that period is the period approved by the Commissioner of the Financial Services Agency pursuant to the provisions of Cabinet Office Order.
(Period Until the Commencement of Public Inspection of Explanatory Documents)
Article 17-13-4The period specified by Cabinet Order that is provided for in Article 63-4, paragraph (3) of the Act (including as applied mutatis mutandis pursuant to Article 63-3, paragraph (2) of the Act; hereinafter the same applies in this Article) is four months; provided, however, that if a Notifier of Specially Permitted Services or a Financial Instruments Business Operator, etc. that is a foreign corporation or an individual domiciled in a foreign state is found to be unable to keep its Explanatory Documents (meaning the Explanatory Documents prescribed in Article 63-4, paragraph (3) of the Act) and provide them for public inspection or disclose them using the Internet or through other means pursuant to the provisions of Cabinet Office Order as prescribed in that paragraph from the day on which four months have elapsed from the end of its business year due to the laws and regulations or practices in its state, that period is the period approved by the Commissioner of the Financial Services Agency pursuant to the provisions of Cabinet Office Order.
(Specially Permitted Services for Foreign Investors)
Article 17-13-5(1)The things specified by Cabinet Order that are provided for in Article 63-8, paragraph (1), item (i) of the Act are those set forth in the items of Article 1-3.
(2)The public offering or private placement specified by Cabinet Order as having little likelihood of allowing persons that are not foreign investors, etc. to acquire the relevant rights, which is provided for in Article 63-8, paragraph (1), item (ii) of the Act, is such public offering or private placement for which a restriction prohibiting the transfer of rights other than transfer to a foreign investor, etc. (meaning the foreign investor, etc. prescribed in paragraph (2) of that Article, and limited to those that do not fall under any of (a) through (c) of paragraph (1), item (i) of that Article) is imposed under the contract for the rights or by other juridical acts.
(3)The persons specified by Cabinet Order as being closely related to the person that performs each of the acts set forth in the items of Article 63-8, paragraph (1), referred to in paragraph (2), item (iii) of that Article, are the following persons:
(i)an Officer (meaning an Officer set forth in Article 29-2, paragraph (1), item (iii) of the Act) of the person that performs the relevant act;
(ii)an employee of the person that performs the relevant act;
(iii)the Parent Company, etc. (meaning a Parent Company, etc. set forth in Article 15-16, paragraph (3)) of the person that performs the relevant act; and
(iv)the persons specified by Cabinet Office Order as being equivalent to the persons set forth in the preceding three items.
(Employee of a Notifier of Specially Permitted Services for Foreign Investors)
Article 17-13-6The employees specified by Cabinet Order that are provided for in Article 63-9, paragraph (1), item (iv) of the Act are employees of a person that seeks to make the notification for the Specially Permitted Services for Foreign Investors, etc. (meaning the Specially Permitted Services for Foreign Investors, etc. prescribed in Article 63-8, paragraph (1) of the Act; hereinafter the same applies in this Article) and that falls under any of the following items:
(i)a person that supervises the function of providing guidance to ensure that Laws and Regulations, etc. are observed with regard to Specially Permitted Services for Foreign Investors, etc., or any other persons specified by Cabinet Office Order as being equivalent thereto; or
(ii)a person that supervises the department conducting investments with regard to Specially Permitted Services for Foreign Investors, etc. and any other person specified by Cabinet Office Order as being equivalent thereto.
(Deemed Replacement of Terms in Connection with Financial Instruments Business Operators That Have Made the Notification of Specially Permitted Services for Foreign Investors)
Article 17-13-7With regard to a Financial Instruments Business Operator that has made the notification under Article 63-11, paragraph (1) of the Act, the deemed replacement of terms under paragraph (2) of that Article when the provisions of that paragraph are applied mutatis mutandis is as given in the following table:
Provisions of the Act whose terms are deemed to be replaced
Original terms
Terms deemed to replace the original terms
Article 63-12, paragraph (2)
foreign corporation
foreign corporation or an individual domiciled in a foreign state
(Special Rules on the Deadline for Submission of Business Reports by a Foreign Corporation)
Article 17-13-8The period specified by Cabinet Order that is provided for in Article 63-12, paragraph (2) of the Act (including as applied mutatis mutandis pursuant to the provisions of Article 63-11, paragraph (2) of the Act) is three months; provided, however, that if a Notifier of Specially Permitted Services for Foreign Investors, etc. or Financial Instruments Business Operator that is a foreign corporation or an individual domiciled in a foreign state is found to be unable to submit Business Reports within the three months after the end of its business year due to the laws and regulations or practices in its state, that period is the period approved by the Commissioner of the Financial Services Agency pursuant to the provisions of Cabinet Office Order.
(Period Until the Commencement of Public Inspection of Explanatory Documents)
Article 17-13-9The period specified by Cabinet Order that is provided for in the provisions of Article 63-12, paragraph (3) of the Act (including as applied mutatis mutandis pursuant to Article 63-11, paragraph (2); hereinafter the same applies in this Article) is four months; provided, however, that if a Notifier of Specially Permitted Services for Foreign Investors, etc. or Financial Instruments Business Operator that is a foreign corporation or an individual domiciled in a foreign state is found to be unable to keep its Explanatory Documents (meaning the Explanatory Documents set forth in Article 63-12, paragraph (3) of the Act), provide them for public inspection, and disclose them using the Internet or through other means from the day on which four months have elapsed from the end of its business year due to the laws and regulations or practices in its state, that period is the period approved by the Commissioner of the Financial Services Agency pursuant to the provisions of Cabinet Office Order.
(Acts That Make a Person Subject to Registration as a Sales Representative)
Article 17-14The acts specified by Cabinet Order that are provided for in Article 64, paragraph (1), item (iii) of the Act are the following acts (excluding those related to the Securities set forth in Article 64, paragraph (1), item (i) of the Act):
(i)a Market Derivatives Transaction, Foreign Market Derivatives Transaction, or intermediation, brokerage, or agency for those transactions;
(ii)intermediation, brokerage, or agency for the entrustment of a Market Derivatives Transactions or Foreign Market Derivatives Transactions;
(iii)a Market Derivatives Transaction, a Foreign Market Derivatives Transaction, or the solicitation of applications for intermediation, brokerage, or agency for those transactions; and
(iv)solicitation for the entrustment of a Market Derivatives Transaction or Foreign Market Derivatives Transaction.
(Registration Fees)
Article 17-15(1)The registration fee under the provisions of Article 64-8, paragraph (1) of the Act (including as applied mutatis mutandis pursuant to Article 66-25 of the Act) is the amount specified by Cabinet Office Order, taking into consideration the actual costs, within three thousand yen for one Sales Representative (meaning a Sales Representative as defined in Article 64, paragraph (1) of the Act; the same applies hereinafter).
(2)The fee referred to in the preceding paragraph may be paid, if it is paid to the State, by affixing revenue stamps in an amount equivalent to the fee to the written application for registration.
(Deemed Replacement of Terms in Appling the Provisions of the Act to a Foreign Corporation)
Article 17-16If a Financial Instruments Business Operator, etc., a Notifier of Specially Permitted Services or a Notifier of Specially Permitted Services for Foreign Investors, etc. is a foreign corporation or an individual domiciled in a foreign state, the deemed replacement of terms under Article 65-2 of the Act in applying the provisions of the Act is as given in the following table:
Provisions of the Act whose terms are deemed to be replaced
Original terms
Terms deemed to replace the original terms
Article 29-2, paragraph (2), item (iii)
the articles of incorporation, certificate of registered matters,
the articles of incorporation, certificate of registered matters (including documents equivalent thereto), certificate of registered matters of the principal business office or office in Japan
Article 31-2, paragraph (1)
the deposit office nearest to their principal business office or office.
the deposit office nearest to their principal business office or office in Japan (with regard to those that do not have a business office or office in Japan, the Tokyo Legal Affairs Bureau)
Article 31-4, paragraph (1)
a director, accounting advisor (if the accounting advisor is a corporation, a member who is supposed to conduct the duty), company auditor or executive officer
the representative person in Japan or a director, accounting advisor (if the accounting advisor is a corporation, a member who is supposed to conduct the duty), company auditor, executive officer, or persons equivalent thereto stationed at the business office or office established in Japan to conduct Financial Instruments Business
Article 31-4, paragraph (2)
a director, accounting advisor, company auditor or executive officer or employee
the representative person in Japan or a director, accounting advisor, company auditor, executive officer (including persons equivalent to such persons), or employee stationed at the business office or office established in Japan to conduct Financial Instruments Business
Article 31-4, paragraph (3)
a director (an executive officer for a company with Committees)
the representative person in Japan or a director, executive officer, or persons equivalent thereto stationed at the business office or office established in Japan to conduct Financial Instruments Business
Article 31-4, paragraph (4)
a director or executive officer
the representative person, a director or executive officer, or persons equivalent thereto (limited to those engaged in Financial Instruments Business) in Japan
Article 33-3, paragraph (1), item (vii)
the head office, and other business office or office
the head office and the principal business office or office and any other business office or office in Japan
Article 33-3, paragraph (2), item (iv)
articles of incorporation, certificate of registered matters,
articles of incorporation, certificate of registered matters (including documents equivalent thereto), and the certificate of registered matters of the principal business office or office in Japan
Article 36-2, paragraph (1)
business offices or other offices
business offices or other offices established in Japan to carry out Financial Instruments Business or Registered Financial Institution Business
Article 42-2, item (i)
director or executive officer
the representative person, a director or executive officer, or persons equivalent thereto in Japan
Article 46-4
all of its business offices or offices
all of its business offices or offices established in Japan to carry out Financial Instruments Business (hereinafter referred to as "All of Its Business Offices or Offices" in this Subsection and Article 47-3)
Article 46-5, paragraph (1)
the purchase and sale or other transactions of Securities or the Derivative Transactions, etc.
purchase and sale or other transactions of Securities, or Derivative Transactions, etc. conducted at All of Its Business Offices or Offices
set up the financial instruments transaction liability reserve
set up the financial instruments transaction liability reserve at its principal business office or office in Japan
Article 46-5, paragraph (2)
the purchase and sale or other transactions of Securities or the Derivative Transactions, etc.
purchase and sale or other transactions of Securities, or the Derivative Transactions, etc. conducted at All of Its Business Offices or Offices
Article 48-3, paragraph (1)
purchase and sale or other transactions of Securities or Derivative Transactions, etc.
purchase and sale or other transactions of Securities, or Derivatives Transactions, etc. conducted at All of its Business offices or Offices established in Japan to perform its Registered Financial Institution Business (hereinafter referred to as "All of Its Business Offices or Offices" in the following paragraph)
set up the financial instruments transaction liability reserve
set up a financial instruments transaction liability reserve at its principal business office or office in Japan
Article 48-3, paragraph (2)
the purchase and sale or other transactions of Securities or Derivative Transactions, etc.
purchase and sale or other transactions of Securities, or the Derivatives Transactions, etc. conducted at All of Its Business Offices or Offices
Article 50, paragraph (1), item (i)
when it has suspended business (limited to Financial Instruments Business or Registered Financial Institution Business (hereinafter referred to as a "Financial Instruments Business, etc." in this Section) or resumed business
when it has suspended or resumed business (limited to Financial Instruments Business or Registered Financial Institution Business (hereinafter referred to as a "Financial Instruments Business, etc." in this Section), or in cases of a person engaged in a Type 1 Financial Instruments Business, when the person has suspended or resumed the business of the same type as a Financial Instruments Business at the person's office
it has suspended or resumed business pertaining to the authorization
it has suspended or resumed the business of the same type as those pertaining to the authorization at its head office or business pertaining to the authorization is suspended or resumed at any of its business offices or offices in Japan
Article 50, paragraph (1), item (ii)
business pertaining to authorization set forth in Article 30, paragraph (1)
business of the same type as those pertaining to authorization set forth in Article 30, paragraph (1) at its head office or abolished the business pertaining to the authorization at any of its business offices or offices in Japan.
Article 50, paragraph (1), item (iii)
has succeeded to all or part of the other corporation's business (limited to business pertaining to Financial Instruments Business, etc.; hereinafter the same applies in this item and the following Article) upon company split
has assumed all or part of the other corporation's business (limited to business pertaining to Financial Instruments Business, etc.; hereinafter the same applies in this item and the following Article) upon company split (with regard to a person engaged in a Type 1 Financial Instruments Business, including the case where such person has had part of the person's business of the same type as a Financial Instruments Business in a foreign state assumed)
acquired all or part of the other corporation's business
acquired all or part of the other corporation's business (with regard to a person engaged in a Type 1 Financial Instruments Business, including the case where such person has transferred part of the person's business of the same type as a Financial Instruments Business in a foreign state)
Article 50, paragraph (1), item (vii)
when an application for commencement of bankruptcy proceedings, rehabilitation proceedings, or reorganization proceedings has been filed
when a petition for commencement of bankruptcy proceedings, rehabilitation proceedings, reorganization proceedings, or liquidation has been filed in Japan or an application of the same kind has been filed in a State where its head office is located based on the laws and regulations of that State
Article 50-2, paragraph (1), item (ii)
when abolishing a Financial Instruments Business, etc.
when abolishing a Financial Instruments Business, etc. (with regard to a person engaged in a Type 1 Financial Instruments Business, including the cases where abolishing a business of the same type as a Financial Instruments Business in a Foreign State)
Article 50-2, paragraph (1), item (iii)
an Officer representing the corporation
an Officer of a corporation
Article 50-2, paragraph (1), item (iv)
has dissolved upon decision of commencement of bankruptcy proceedings
has become subject to a ruling for the commencement of bankruptcy proceedings, or has commenced procedures for the same kind of bankruptcy proceedings in a State where its head office is located based on the laws and regulations of that State.
the bankruptcy trustee thereof
the bankruptcy trustee thereof or the person equivalent to a bankruptcy trustee in that State
Article 50-2, paragraph (1), item (v)
has dissolved due to reasons other than a merger or the decision of commencement of bankruptcy proceedings
has dissolved due to reasons other than a merger or the decision of commencement of bankruptcy proceedings (with regard to a person engaged in a Type 1 Financial Instruments Business, including the case where such person has commenced the liquidation of the business offices or offices in Japan)
the liquidator thereof
the liquidator thereof or the person equivalent to a liquidator in the State where its head office is located
Article 50-2, paragraph (1), item (vi)
has had whole or part of its business succeeded to upon company split
has had its business assumed in whole or in part upon company split (with regard to a person engaged in a Type 1 Financial Instruments Business, including the cases where such person has had the whole of the person's business of the same type as a Financial Instruments Business assumed in a foreign state)
Article 50-2, paragraph (1), item (vii)
when transferring whole or part of its business
when transferring its business in whole or in part (with regard to a person engaged in a Type 1 Financial Instruments Business, including the case where such person has transferred the whole of the person's business of the same type as a Financial Instruments Business in a foreign state)
Article 50-2, paragraph (2)
has had its whole business succeeded to
has had part of its business assumed
limited to when a Financial Instruments Business Operator, etc. has transferred its whole business
excluding the case when a Financial Instruments Business Operator, etc. has transferred part of its business
Article 50-2, paragraph (6)
abolish Financial Instruments Business, etc. (excluding Investment Advisory and Agency Business; the same applies in paragraph (8) and Article 56, paragraph (1))
abolish a Financial Instruments Business, etc. (excluding an Investment Advisory and Agency Business; the same applies in paragraph (8) and Article 56, paragraph (1)) (with regard to a person engaged in a Type 1 Financial Instruments Business, including the abolition of a business of the same type as a Financial Instruments Business in a foreign state)
have all or part of its business succeeded to upon company split
have its business assumed in whole or in part upon company split (with regard to a person engaged in a Type 1 Financial Instruments Business, including the succession to the person's whole business of the same type as a Financial Instruments Business in a foreign state)
transfer all or part of its business
transfer its business in whole or in part (with regard to a person engaged in a Type 1 Financial Instruments Business, including the transfer of the person's whole business of the same type as a Financial Instruments Business in a foreign state)
all of its business offices or offices
all of its business offices or offices established in Japan to carry out Financial Instruments Business
Article 50-2, paragraph (8)
succession of whole or part of its business upon merger or company split
succession of its business in whole or in part upon merger or company split (with regard to a person engaged in a Type 1 Financial Instruments Business, including the succession to the whole of the person's business of the same type as a Financial Instruments Business in a foreign state)
transfer of whole or part of business
transfer of business in whole or in part (with regard to a person engaged in a Type 1 Financial Instruments Business, including the transfer of the whole of the person's business of the same type as a Financial Instruments Business in a foreign state)
Article 56, paragraph (1)
has dissolved
has dissolved (with regard to a person engaged in a Type 1 Financial Instruments Business, including the commencement of liquidation of the business offices or offices in Japan)
abolished
abolished (with regard to a person engaged in a Type 1 Financial Instruments Business, including the abolition of business of the same type as a Financial Instruments Business in a foreign state)
Article 63, paragraph (6) and Article 63-4, paragraph (3)
its principal business office or office and all of its business offices or offices for Specially Permitted Services for Qualified Institutional Investors, etc.
all business offices and offices in Japan that it has established for the purpose of engaging in Specially Permitted Services for Qualified Institutional Investors, etc.
Article 63-9, paragraph (5) and Article 63-12, paragraph (3)
principal business office or office and all of its business offices or offices for specially permitted services for foreign investors, etc.
principal business office or office in Japan and all of its business offices or offices in Japan that it has established for the purpose of engaging in specially permitted services for foreign investors, etc.
Article 64, paragraph (3), item (ii)
the representative person
the representative person in Japan
Chapter IV-2 Financial Instruments Intermediary Service Providers
(Material Particulars That May Impact Customers' Judgment)
Article 18(1)The particulars specified by Cabinet Order that are provided for in Article 66-10, paragraph (1), item (iii) of the Act are as follows:
(i)the particulars specified by Cabinet Office Order regarding the fees, remuneration, or any other consideration payable by the customer with regard to a financial instruments transaction contract involving Intermediation for Financial Instruments (meaning the acts set forth in the items of Article 2, paragraph (11) of the Act; the same applies hereinafter);
(ii)if there is customer margin or some other security deposit or any other thing specified by Cabinet Office Order payable by the customer in connection with a financial instruments transaction contract involving Intermediation for Financial Instruments, the amount thereof or the method of calculation therefor;
(iii)if the Amount of Derivatives Transaction, etc. conducted by a customer may exceed the Amount of Security Deposit, etc., the following particulars:
(a)to the effect that the Amount of the Derivatives Transaction, etc. may exceed the Amount of Security Deposit, etc.; and
(b)the ratio of the Amount of the Derivatives Transaction, etc. to the Amount of Security Deposit, etc. (if that ratio cannot be calculated, an indication of this and the reason therefor);
(iv)the following particulars, if there is a risk for a loss to arise that has as its direct cause fluctuations in money rates, the value of currencies, quotations on a Financial Instruments Market, or any other indicator, as regards an act that constitutes a Financial Instruments transaction conducted by a customer:
(a)the indicator in question; and
(b)an indication of the risk that fluctuations in that indicator could give rise to a loss and the reasons for this;
(v)if there is a risk that the amount of loss referred to in the preceding item could exceed the Amount of Security Deposit, etc. (hereinafter referred to as "Risk of Loss in Excess of Principal" in this item), the following particulars:
(a)among the indicators set forth in the preceding item, those which are the direct cause for the Risk of Loss in Excess of Principal; and
(b)an indication that there is a Risk of Loss in Excess of Principal due to fluctuations in the indicator set forth in (a) and the reason therefor; and
(vi)any particulars specified by Cabinet Office Order as being equivalent to the particulars set forth in the preceding item.
(2)Notwithstanding the provisions of the preceding paragraph, the particulars specified by Cabinet Order that are provided for in Article 66-10, paragraph (1), item (iii) of the Act if the acts set forth in Article 66-10, paragraph (1) of the Act are to be carried out by way of broadcasting, using the broadcast equipment of a Private Broadcaster or by any other means specified by Cabinet Office Order as being equivalent thereto, are as follows:
(i)if there is a risk for a loss to arise that has as its direct cause fluctuations in money rates, the value of currencies, quotations on a Financial Instruments Market, or any other indicator, as regards an act that constitutes a Financial Instruments transaction conducted by a customer, an indication of this risk (if there is a risk that the amount of the loss may exceed the Amount of Security Deposit, etc., an indication of that risk is included); and
(ii)any particulars specified by Cabinet Office Order as being equivalent to the particulars set forth in the preceding item.
(Scope of Persons Closely Related to a Financial Instruments Intermediary Service Provider)
Article 18-2The persons specified by Cabinet Order that are provided for in Article 66-13 of the Act are any of the following persons not constituting a Financial Instruments Business Operator (limited to those engaged in Securities, etc. Management), Bank, or any other person specified by Cabinet Office Order:
(i)a relative (limited to the spouse thereof and a relative by blood or affinity within the third degree of kinship) of the Financial Instruments Intermediary Service Provider (limited to one that is an individual);
(ii)an Officer or employee of the Financial Instruments Intermediary Service Provider (limited to one that is a corporation; hereinafter the same applies in this Article);
(iii)the Parent Corporation, etc. or Subsidiary Corporation, etc. of the Financial Instruments Intermediary Service Provider;
(iv)Specified Individual Shareholders of all shareholders, etc. of the Financial Instruments Intermediary Service Provider (excluding those set forth in item (ii)); and
(v)any person specified by Cabinet Office Order as being equivalent to the persons set forth in the preceding items.
(Deemed Replacement of Terms in Connection with Financial Instruments Intermediary Service Providers)
Article 18-3With regard to a Financial Instruments Intermediary Service Provider or its customers referred to in Article 66-15 of the Act, the registration under Article 66 of the Act or the Financial Instruments Intermediary Service Provider referred to in Article 66-23 of the Act or the Financial Instruments Intermediary Service Provider referred to in Article 66-25 of the Act, the deemed replacement of terms under the provisions of Article 66-15, Article 66-23, and Article 66-25 of the Act in applying the provisions of the Act mutatis mutandis is as given in the following table:
Provisions of the Act whose terms are deemed to be replaced
Original terms
Terms deemed to replace the original terms
Article 38-2
Investment Advisory and Agency Business or Investment Management Business
Financial Instruments Intermediary Service (limited to functions that carry out the acts listed in Article 2, paragraph (11), item (iv) of the Act)
an Investment Advisory Contract, Discretionary Investment Contract or contract specified in Article 2, paragraph (8), item (xii), (b)
an Investment Advisory Contract, Discretionary Investment Contract
Article 39, paragraphs (1) and (3)
purchase and sale or other transactions of Securities (excluding purchase and sale on condition of repurchase for which the repurchase price is set in advance and other transactions specified by Cabinet Order) or Derivative Transactions (hereinafter referred to as "Purchase and Sale or Other Transaction of Securities, etc." in this Article)
Intermediation for Financial Instruments
the relevant Securities or Derivative Transactions
the relevant Securities, Market Transactions of Derivatives, or Foreign Market Derivatives Transactions related to the relevant Intermediation for Financial Instruments
purchase and sale of Securities or Derivative Transactions
purchase and sale of Securities, Market Transactions of Derivatives, or Foreign Market Derivatives Transactions
with regard to the Purchase and Sale or Other Transaction of Securities, etc.,
with regard to the Intermediation for Financial Instruments
this Section and the following Section
this Article
Article 40
an act that constitutes a Financial Instruments Transaction
Intermediation for Financial Instruments
for a Financial Instruments Transaction Contract
for a Financial Instruments Transactions Contract related to the relevant Intermediation for Financial Instruments
Article 43-6, paragraph (1)
an act that constitutes a Financial Instruments Transaction
Intermediation for Financial Instruments
Article 57
an Article 29 or Article 33-2 registration, an Article 30, paragraph (1) authorization, or an Article 31, paragraph (4) registration of a change
registration under Article 66
the applicant or the Financial Instruments Business Operator
the applicant for registration
the applicant or the Financial Instruments Business Operator
the applicant for registration
the provisions of Article 51; Article 51-2; Article 52, paragraph (1); Article 52-2, paragraph (1); Article 53; Article 54; or the preceding Article
the provisions of Article 66-20, paragraph (1)
an Article 29 or Article 33-2 registration, the an Article 30, paragraph (1) or Article 31, paragraph (6) authorization, an Article 31, paragraph (4) registration of a change, or an Article 35, paragraph (4) approval
registration under Article 66
to attach conditions pursuant to the provisions of Article 30-2, paragraph (1), or to issue a disposition based on the provisions of Article 51; Article 51-2; Article 52, paragraph (1) or (2); Article 52-2, paragraph (1) or (2); Article 53; Article 54; or the preceding Article
or to issue a disposition based on the provisions of Article 66-20
Article 64
the following acts on its behalf
the following acts on its behalf (excluding the acts set forth in item (ii))
Article 2, paragraph (8), items (i) to (iii), item (v), item (viii), and item (ix)
Article 2, paragraph (11), items (i) to (iii)
(b) the following acts:
(b) the following acts (excluding the acts set forth in 2. below)
purchase and sale, or intermediary, brokerage (excluding Brokerage for Clearing of Securities, etc.) or agency service thereof
intermediary service for purchase and sale
beyond what is set forth in the preceding two items, acts specified by Cabinet Order
the following acts (excluding the acts set forth in item (i)):
(a) intermediary service for entrustment of Market Transaction of Derivatives or Foreign Market Derivatives Transaction; and
(b) solicitation for entrustment of Market Transaction of Derivatives or Foreign Market Derivatives Transaction.
Article 64-3
the items of Article 64, paragraph (1)
the items of Article 64, paragraph (1) as applied mutatis mutandis pursuant to Article 66-25 (including the acts listed in Article 64, paragraph (1), item (ii))
Article 64-4
the provisions of Article 64, paragraph (1)
the provisions of Article 64, paragraph (1) as applied mutatis mutandis pursuant to Article 66-25
Article 64, paragraph (3), item (iii), (a) or (b)
Article 64, paragraph (3), item (iii), (a) or (b) as applied mutatis mutandis pursuant to Article 66-25
Article 64-5
the items of Article 64-2, paragraph (1)
the items of Article 64-2, paragraph (1) as applied mutatis mutandis pursuant to Article 66-25
acts set forth in the items of Article 64, paragraph (1) among Financial Instruments Business (Registered Financial Institution Business for Registered Financial Institutions)
acts set forth in the items of Article 64, paragraph (1) as applied mutatis mutandis pursuant to Article 66-25 from among Financial Instruments Business (excluding the acts set forth in Article 64, paragraph (1), item (ii))
Article 64-6
the provisions of paragraph (1) of the preceding Article
the provisions of paragraph (1) of the preceding Article as applied mutatis mutandis pursuant to Article 66-25
has dissolved or abolished business to conduct acts set forth in the items of Article 64, paragraph (1) among Financial Instruments Business (Registered Financial Institution Business for Registered Financial Institutions)
has died, dissolved, or abolished the business to conduct acts listed in the items of Article 64, paragraph (1) as applied mutatis mutandis pursuant to Article 66-25 from among the Financial Instruments Business (excluding the acts set forth in Article 64, paragraph (1), item (ii))
Article 64-7 (excluding paragraph (2))
Article 64, Article 64-2, and the preceding three Articles
the provisions of Article 64, Article 64-2, and the preceding three Articles as applied mutatis mutandis pursuant to Article 66-25
Article 64-9
Article 64-9 as applied mutatis mutandis pursuant to Article 66-25
a Financial Instruments Business Operator, etc. belonging to the Association
a Financial Instruments Intermediary Service Provider that has the member firms of the Association as the Entrusting Financial Instruments Business Operator, etc. (meaning an Entrusting Financial Instruments Business Operator, etc. as defined in Article 66-2, paragraph (1), item (iv))
the preceding two paragraphs
paragraph (1)
pursuant to the provisions of paragraph (1) or (2)
pursuant to the provisions of paragraph (1)
registration under Article 64, paragraph (5), change of registration pertaining to notification under Article 64-4, rendering of disposition under Article 64-5, paragraph (1) (excluding deletion of registration), or deletion of registration under the preceding Article
registration under Article 64, paragraph (5) as applied mutatis mutandis pursuant to Article 66-25, change of registration pertaining to notification under Article 64-4 as applied mutatis mutandis pursuant to Article 66-25, rendering of disposition under Article 64-5, paragraph (1) as applied mutatis mutandis pursuant to Article 66-25 (excluding deletion of registration), or deletion of registration under the preceding Article as applied mutatis mutandis pursuant to Article 66-25
registration work under the provisions of paragraph (1) or paragraph (2)
registration work under the provisions of paragraph (1)
registration work prescribed in paragraph (1) under the provisions of that paragraph as applied mutatis mutandis pursuant to Article 66-25
work related to the registration prescribed in Article 64, Article 64-2, and the preceding three Articles regarding a sales representative of a financial instruments business operator, etc.
a Financial Instruments Business Operator, etc. belonging to an Association that conducts Registration Work under the provisions of paragraph (1)
a Financial Instruments Intermediary Service Provider
Article 64-5, paragraph (1), item (i)
Article 64-5, paragraph (1), item (i) as applied mutatis mutandis pursuant to Article 66-25
the association... that paragraph
an association... that paragraph
paragraph (1) or (2)
paragraph (1)
these provisions
the provisions of that paragraph
Article 64-8
paragraph (1) or (2) of the preceding Article
paragraph (1) of the preceding Article as applied mutatis mutandis pursuant to Article 66-25
Article 64-9
Article 64-7, paragraph (1) or (2)
Article 64-7, paragraph (1) as applied mutatis mutandis pursuant to Article 66-25
Article 64, paragraph (3)
Article 64, paragraph (3) as applied mutatis mutandis pursuant to Article 66-25
Article 64-2, paragraph (1)
Article 64-2, paragraph (1) as applied mutatis mutandis pursuant to Article 66-25
Article 64-7, paragraph (1)
Article 64-7, paragraph (1) as applied mutatis mutandis pursuant to Article 66-25
Article 64-5, paragraph (1)
Article 64-5, paragraph (1) as applied mutatis mutandis pursuant to Article 66-25
(Provisions Concerning Explanatory Documents)
Article 18-4The provisions specified by Cabinet Order that are provided for in Article 66-18 of the Act are the following provisions:
(i)Article 21, paragraphs (1) and (2) of the Banking Act as applied mutatis mutandis pursuant to Article 17 of the Long Term Credit Bank Act, Article 89, paragraph (1) of the Credit Union Act (Act No, 238 of 1951), Article 6, paragraph (1) of the Act on Financial Businesses by Cooperatives (Act No. 183 of 1949), or Article 94, paragraph (1) of the Labor Bank Act (Act No, 227 of 1953);
(ii)Article 81, paragraphs (1) and (2) of the Agriculture and Forestry Credit Union Act (Act No. 93 of 1938);
(iii)Article 53, paragraphs (1) and (2) of the Shoko Chukin Bank Limited Act (Act No. 74 of 2007);
(iv)Article 54-3, paragraphs (1) and (2) of the Agricultural Cooperatives Act (Act No. 132 of 1947);
(v)Article 58-3, paragraphs (1) and (2) of the Fisheries Cooperative Act (Act No. 242 of 1948); and
(vi)Article 101, paragraphs (1) and (2) of the Insurance Business Act.
Chapter IV-3 Credit Rating Agencies
(Deadline for Submission of Business Reports)
Article 18-4-2The period specified by Cabinet Order that is provided for in Article 66-38 of the Act is three months; provided, however, that if a foreign corporation (including a foreign organization without legal personality for which a representative person or administrator has been designated; hereinafter the same applies in the following Article and Article 18-4-5) is found to be unable to submit the Business Reports within the three months after the end of its business year due to the laws and regulations or practices in its state, that period is the period approved by the Commissioner of the Financial Services Agency pursuant to the provisions of Cabinet Office Order.
(Period Until the Commencement of Public Inspection of Explanatory Documents)
Article 18-4-3The period specified by Cabinet Order that is provided for in the provisions of Article 66-39 of the Act is four months; provided, however, that if a foreign corporation is found to be unable to keep its Explanatory Documents (meaning the Explanatory Documents set forth in that Article), provide them for public inspection, and disclose them using the Internet or through other means from the day on which four months have elapsed from the end of its business year due to the laws and regulations or practices in its state, that period is the period approved by the Commissioner of the Financial Services Agency pursuant to the provisions of Cabinet Office Order.
(Deemed Replacement of Terms in the Provisions of the Companies Act as Applied Mutatis Mutandis When a Credit Rating Agency Gives Public Notice of the Discontinuation of Its Credit Rating Services by Way of Electronic Public Notice)
Article 18-4-4If the public notice under Article 66-40, paragraph (3) of the Act is given by way of Electronic Public Notice, the deemed replacement of terms under Article 66-40, paragraphs (5) and (6) of the Act when the provisions of the Companies Act are applied mutatis mutandis pursuant to Article 66-40, paragraphs (5) and (6) of the Act is as given in the following table:
Provisions of the Companies Act whose terms are deemed to be replaced
Original Terms
Terms deemed to replace the original terms
Article 940, paragraph (3) (excluding the items)
the preceding two paragraphs
paragraph (1)
these provisions
the provisions of that paragraph
(Deemed Replacement of Terms in Applying the Provisions of the Act to a Foreign Corporation)
Article 18-4-5If a Credit Rating Agency is a foreign corporation, the deemed replacement of terms under Article 66-47 of the Act in applying the provisions of the Act is as given in the following table:
Provisions of the Act whose terms are deemed to be replaced
Original Terms
Terms deemed to replace the original terms
Article 66-28, paragraph (2), item (iii)
the articles of incorporation, certificate of registered matters,
the articles of incorporation, certificate of registered matters (including documents equivalent thereto), certificate of registered matters of the principal business office or office in Japan
Article 66-39
all of its business offices or offices
all of its business offices or offices established in Japan to carry out Credit Rating Services
Article 66-40, paragraph (1), item (ii)
an Officer representing the corporation
an Officer of a corporation
Article 66-40, paragraph (1), item (iii)
has dissolved upon decision of commencement of bankruptcy proceedings
has become subject to a ruling for the commencement of bankruptcy proceedings, or has commenced procedures for the same kind of bankruptcy proceedings in a State where its head office is located based on the laws and regulations of that State.
the bankruptcy trustee thereof
the bankruptcy trustee thereof or the person equivalent to a bankruptcy trustee in that State
Article 66-40, paragraph (1), item (iv)
has dissolved due to reasons other than a merger or the decision of commencement of bankruptcy proceedings
has dissolved due to reasons other than a merger or the decision of commencement of bankruptcy proceedings (including the case where that corporation has commenced the liquidation of the business offices or offices in Japan)
the liquidator thereof
the liquidator thereof or the person equivalent to a liquidator in the State where its head office is located
(Deemed Replacement of Terms in Applying the Provisions of the Act to an Organization Without Legal Personality for Which a Representative Person or Administrator Has Been Designated)
Article 18-4-6If a Credit Rating Agency is an organization without legal personality for which a representative person or administrator has been designated, the deemed replacement of terms under Article 66-47 of the Act for applying the provisions of the Act is as given in the following table: