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Last Updated: March 1, 2016
Financial Services Agency
Government of Japan

To Those who Operate Fund Related Businesses in Japan
(Guidelines on Registration and Notification Requirements)

Points to keep in mind

  • The Financial Instruments and Exchange Act (hereafter “FIEA”), since it’s enforcement on September 30, 2007, requires registration for any person that engages in self-offering of interests in collective investment schemes (funds) or self-management of assets contributed from investors (limited to investments in securities, etc.). In addition, private offerings to one or more Qualified Institutional Investors (hereafter “QIIs”) and 49 or less investors with the capacity to make investment decisions, as well as self-management of invested assets (limited to investments in securities, etc.) are required to make notification to the applicable Local Finance Bureau.
  • On and after March 30, 2008, only persons who have been registered or notified may, in principle, operate such businesses.

I. Definition of collective investment scheme (funds)

In accordance with FIEA, interests in collective investment schemes (funds) as set out below are considered to be securities and are subject to regulations.

  • The right to receive dividends of profits or distribution of assets arising from businesses that use cash, securities, bills of exchange, promissory notes and race horses1 (Invested Business) contributed from equity owners (equity partners) that does not fall under any one of the following:
    (a) Other securities.
    (b) The right of an equity partner when all equity partners are involved in a Invested Business2
    (c) The right with a condition that dividends of profits or distribution of assets to an equity partner shall not exceed the amount of his or her capital contribution.
    (d) The right based on an insurance contract (under the Insurance Business Act), a mutual aid contract (under the Agricultural Cooperative Law, the Consumers Livelihood Co-operative Society Law, the Fisheries Cooperatives Law or the Small and Medium-Sized Enterprise Cooperative Association Act) or a contract under the Real Estate Specified Joint Business Law.
    (e) The right relating to the investment in a corporation established under Japanese laws and regulations (excluding General Incorporated Associations except for Public Incorporate Associations, and excluding General Incorporated Foundations except for Public Interest Incorporated Foundations).
    (f) The right in a contract for shared forest systems under the Act on Special Measures concerning Shared Forest.
    (g) The right based on cooperative associations in which participation is restricted to certified public accountants, lawyers, judicial scriveners, land and house surveyors, certified administrative procedures specialists, certified tax accountants, certified real estate appraisers, certified social insurance labor consultants or patent attorneys and those whose exclusive Invested Business constitute the operation of such businesses.
    (h) The right based on a stock ownership plan3
    (i) The right based on a contract in which an employee of an affiliate company of an issuer of shares promises to regularly purchase shares jointly with other employees of the affiliate, in accordance with a specific purchase plan, without relying on individual investment decisions (the individual contribution per employee must be less than one million yen).
    (j) The rights based on a contract in which an officer or an employee of an asset management company or a specified affiliate company of an issuer of investment securities promises to regularly purchase investment securities jointly with other officers or employees of the asset management company or the specified affiliate company, in accordance with a specific purchase plan, without relying on individual investment decisions (the individual contribution per officer or employee must be less than one million yen).
    (k) The right based on a contract in which a corporation or some other organization promises to engage in contents business jointly with other corporations or organizations4

II. Definition of a person engaging in a collective investment scheme (funds)

Among persons who manage such interests in a collective investment scheme (funds), foreign corporations or individual foreign residents who engage in the following businesses are required to register with or notify to each Local Finance Bureau that has jurisdiction over the location of their offices when said person have offices in Japan, or with the Kanto Local Finance Bureau when no office is maintained in Japan.

(a) Public or private offering.
(b) Investment management of assets contributed by investors (restricted to investment management mainly in the form of rights on securities or derivative contracts based on the analysis of the value of financial instruments, the value of options or the changes in financial indexes).

III. Registration and notification

In principle, if there is an equity partner who is not the investor with the capacity to make investment decisions, the following registrations are required to be filed with each Local Finance Bureau that has jurisdiction over the location of their offices when the persons have offices in Japan, or with the Kanto Local Finance Bureau when no office is maintained in Japan.

  • For persons engaging in the business described in II(a) above, registration of a Financial Instruments Business Operator (Type II Financial Instruments Business), and/or
  • For persons engaging in the business described in II(b) above, registration of a Financial Instruments Business Operator (Investment Management Business).
  • Among businesses such as those in II(b) above, persons engaging in the following businesses are exempt from the registration or notification requirements.
    (a) When a person enters into a discretionary investment agreement with another Financial Instruments Business Operator, etc. for the purpose of entrusting all powers and rights for investment management and specific requirements are met5 and the Financial Instruments Business Operator, etc. has reported the required matters concerning the person6 before the commencement of the business in question.
    (b) When a person invests cash, etc., which has been contributed based on a Silent Partnership Contract concluded with another party, in which beneficiary interests to real estate and specific requirements are met7 and the party provides required matters concerning the person6 before the commencement of the business in question.
    (c) When a manager of a Silent Partnership acquires race horses by using all of the cash, etc. contributed from partners, and then contributes the horses under another Silent Partnership Contract.
    (d) For investment management by a foreign collective investment scheme, when (1)the number of investors who are resident in Japan is less than ten QIIs or the notifiers of SPBQII and (2)their direct contribution is less than one-third of the total contribution.

IV. Regulations for registered Financial Instruments Business Operators

  • FIEA provides the following regulations for Financial Instruments Business Operators:
  • (a) Refusal Requirement of registration

    Refusal Requirements for the registration of Financial Instruments Business Operator are stipulated as below:

    *The following shows only a part of the Refusal Requirements. Please refer to Article 29-4 of FIEA for the entire listing.

    • 1. A person falls under any of the following conditions.

      (1) A person who has had his or her registration, etc., as a Financial Instruments Business Operator revoked or has received an order to terminate SPBQII, and for whom five years have not passed since the date of the revocation or order; or a person who has had his or her similar registration under foreign laws or regulations equivalent to FIEA revoked or has received an order to terminate similar business activities to SPBQII, and for whom five years have not passed since the date of the revocation or order.
      (2) A person who has filed for termination of his or her financial instruments business or SPBQII during the period between the date of a hearing notice regarding a revocation of registration as a Financial Instruments Business Operator or a termination of SPBQII, and the date of the decision whether to implement the penalty, and for whom five years have not passed since the filing.
      (3) A person who has been fined (including any similar penalty under laws or regulations of a foreign country) due to a violation of FIEA or other laws or regulations concerning the financial business or similar laws or regulations of a foreign country, for whom five years have not passed since the date of the implementation of the penalty or the penalty is no longer applicable.
      (4) A person who engages in other businesses that are considered against public interest.
      (5) A person who does not have sufficient human resources to implement financial instrument businesses in an appropriate manner.
      (6) A person who is not considered to have established a system necessary to operate the financial instruments business appropriately.
    • 2. A corporation that has an officer (including a person who is considered to have the power to control the corporation that is equivalent to that of a director, executive officer or other similar authority, regardless of his or her title, such as counselor or advisor) or an employee stipulated by a cabinet order who falls under any of the following conditions:

      (1) A person for which a guardian or curator is appointed or a person treated similarly under foreign laws and regulations.
      (2) A person who has received a ruling of the commencement of bankruptcy proceedings and whose legal status has not been restored or a person treated similarly under foreign laws and regulations.
      (3) A person who has received a penalty of imprisonment or a penalty more severe (including a similar penalty under foreign laws and regulations) and it has not been five years since the execution of the penalty or the date when the penalty became no longer applicable.
      (4) In a case where a corporation, which was once a Financial Instruments Business Operator, (1)has had its financial instruments business registration, etc. revoked, or has received an order to terminate SPBQII operation, or (2)has had its registration, etc., under foreign laws or regulations similar to FIEA revoked, or has received an order to terminate business activities equivalent to the SPBQII operation, a person who was an officer of said corporation within 30 days before the revocation or order and for whom five years have not passed since the date of such the revocation or order.
      (5) When an individual, who was once a Financial Instruments Business Operator, (1)has had his or her financial instruments business registration, etc. revoked, or has received an order to terminate SPBQII, or (2)has had his or her registration, etc., under foreign laws and regulations similar to FIEA revoked, or has received an order to terminate businesses equivalent to the SPBQII, and for whom five years have not passed since the date of the revocation or order.
      (6) A person who was an officer of a corporation that has filed for termination of its financial instruments business or SPBQII during the period between the date of a hearing notice regarding a revocation of registration as a Financial Instruments Business Operator or a termination of SPBQII, and the date of the decision whether to implement the penalty, and for whom five years have not passed since the filing.
      (7) An individual to whom Section 1.(2) applies.
      (8) An officer discharged or dismissed under the provisions of FIEA or an officer discharged in accordance with the provisions of foreign laws and regulations equivalent to FIEA, and for whom five years have not passed since the date of the discharge.
      (9) A person who has been fined due to a violation of FIEA or other laws or regulations concerning the financial business or the Law for the Prevention of Unjust Acts by Organized Crime Group Members or equivalent foreign laws and regulations, or has been fined for a crime under the Penal Code or the Law for the Punishment of Physical Violence, etc. (including penalty under the equivalent foreign laws and regulations), and for whom five years have not passed since the imposition of the fine or the date when the penalty is no longer applicable.
    • 3. An individual who falls under any of 2. (1) to (9) above or an individual who was an employee stipulated by cabinet orders who falls under any of 2. (1) to (9) above.

    • 4. Parties intending to operate Type II Financial Instruments Business or investment management business (excluding individuals) that fall under any of the following:

      (1) A person who has an amount of capital or total amount of contributions less than 10 million yen for Type II Financial Instruments Business and less than 50 million yen for an investment management business.
      (2) A person without a business office in Japan.
      (3) A foreign corporation without any representative in Japan.
      (4) A person who is not a member of any financial instruments business association, and has not established internal rules aligned with the association’s articles of incorporation and other rules or has established internal rules but no system to comply with the internal rules.
    • 5. For an investment management business, a person that falls under any of the following:

      (1) An entity that is not a company limited by shares (only those with a board of directors, corporate auditors, an audit committee, or a nominee committee, etc.,) or a company of similar types organized under foreign laws and regulations.
      (2) A person whose net worth (calculated by subtracting the amount of total liabilities from total assets) is less than 50 million yen.
      (3) A person whose other business is considered to be detrimental to the protection of investors because it does not fall under any of the businesses stipulated in Paragraph 1 of Article 35 or any of the Items of Paragraph 2 of Article 35 of FIEA and the risk of loss from such other business is difficult to control.
      (4) A corporation (excluding foreign corporations) whose major shareholders (in the case where the entity filing for registration is a subsidiary of a holding company, including major shareholders of the holding company) includes an individual that falls under any of the following:
      • An adult ward, a person under curatorship or the equivalent under foreign laws and regulations, whose legal representative falls under any of Section 2. (1) to (9).
      • A person that falls under any of Section 2. (2) to (9).
      (5) A corporation (excluding foreign corporations) whose major corporate shareholders include a shareholder that falls under any of the following:
      • A corporation that falls under Section 1. (1) or (2).
      • A corporation that has been fined for a violation of FIEA or other finance related laws and regulations (including any similar penalty under laws or regulations of a foreign country), and for which five years have not passed since the penalty execution or the date when the penalty became no longer applicable.
      • A corporation with a representative officer that falls under any of Section 2. (1) through (9).
      (6) A foreign entity with regard to which no competent foreign authority has confirmed that any person equivalent to a major shareholder of a company limited by shares would not be detrimental to the sound and appropriate operation of the financial instruments businesses.
  • (b) Major Conduct Controls

    The following are major Conduct Controls: 8

    • 1. Obligation of good faith and fair practice to clients.

    • 2. Prohibition of name lending.

    • 3. Restriction on advertisements.

      A Financial Instruments Business Operator is required to present the following information when it advertises or carries out similar activities:

      (1) Name of Business or Name.
      (2) The fact that it is a Financial Instruments Business Operator and its registration number.
      (3) Matters relating to the fees and similar considerations to be paid by clients.
      (4) Matters relating to risks.
      (5) The unfavorable facts for clients in respect to significant matters concerning financial instrument transaction contracts.
      (6) When the Financial Instruments Business Operator is a member of a financial instruments business association, the fact thereof and the name of the association.
    • 4. Delivery of a written document prior to entry into a financial instrument transaction contract

      When a Financial Instruments Business Operator enters into a financial instrument transaction contract with a client, it is required to deliver to the client a written document describing the following matters in advance.

      (1) Name of Business or Name and address.
      (2) The fact that it is a Financial Instruments Business Operator and its registration number.
      (3) Overview of the financial instrument transaction contract.
      (4) Matters relating to the fees and similar considerations to be paid by clients.
      (5) Matters relating to risks.
      (6) Notice that a client must read and understand the contents of Pre-Contract Documents.
      (7) Outline of taxation relating to financial instrument transaction contracts.
      (8) Details of termination events under the financial instrument transaction contract, if any.
      (9) Outline of the Financial Instruments Business Operator and the financial instrument business to be carried out.
      (10) Means for clients to contact the Financial Instruments Business Operator.
      (11) Whether or not the Financial Instruments Business Operator is a member of a financial instruments business association and if applicable, the name of the association.
      (12) Where a Designated Dispute Resolution Organization (the “DDRO”) is involved, the DDRO’s corporate name; and where there is no DDRO involvement, details of complaint-handling measures and dispute resolution measures.
      (13) When there are any restrictions on the transfer of securities, the fact and details thereof.
      (14) The following items relating to the collective investment scheme (fund)9
      • Name/ type of the fund
      • Matters relating to applying for contract execution
      • Matters relating to the payment of monies for investment or contribution
      • Contract period, if any
      • Matters relating to cancellation
      • Details of provisions on the scheduled indemnification amount, if any
      • Matters relating to the scope of rights and responsibilities of the customer
      • Matters relating to the fund’s operation
      • Matters relating to accounting of the fund
      (15) The following matters when the collective investment scheme (fund) is formed under foreign laws and regulations in addition to (1) to (14) above.
      (i) Name and content of the law that governs the fund contract.
      (ii) Whether there is a foreign authority supervising the issuer of the interests of the fund, and, if any, the authority’s name and details of supervision.
      (iii) Handling of remittance of dividends under the foreign exchange control in question.
      (iv) Whether the fund has an attorney who has the right to represent the issuer in Japan and if applicable, his or her full name and other names.
      (v) Where there is a specified court that has jurisdiction in case of lawsuits, such court’s name, address, etc.
    • 5. Delivery of a written document at the closing of a transaction contract

      When a financial instrument transaction contract is concluded for a client, the Financial Instruments Business Operator is required to deliver without delay to the client a written document describing the following matters:

      (1) Name of Business or Name.
      (2) Name of business office.
      (3) Outline of the financial instrument transaction contract and the date of the closing of the transaction contract.
      (4) Matters relating to the fees and other considerations to be paid by the client.
      (5) Client’s full name or denomination.
      (6) Methods for clients to contact the Financial Instruments Business Operator.
      (7) Selling or purchasing, name of issue, contracted volume, price, the amount to be paid by the client and its calculation method, and types of trading.
    • 6. Prohibited acts

      (1) Delivering false information to a client in order to conclude or solicit a financial instrument transaction contract.
      (2) Providing a client with an assertive judgment on uncertain matters or providing a client with a misleading statement in order to solicit a financial instrument transaction contract.
      (3) Concluding a financial instrument transaction contract without providing client with sufficient explanations necessary for understanding of the contract in the light of the client’s knowledge, experience, financial condition as well as the purpose for concluding the financial instrument transaction contract.
      (4) Presenting a false statement or misleading information relating to material matters in order to conclude or solicit a financial instrument transaction contract.
      (5) Providing or promising to provide special benefits for a client at the conclusion of a financial instrument transaction contract.
      (6) Cheating, using force or threatening a client in order to conclude or cancel a financial instrument transaction contract.
      (7) Rejecting the execution of all or part of the obligations under a financial instrument transaction contract, including but not limited to financial instrument transactions, or delaying the same unfairly.
      (8) Providing property benefits to the client or any third party or making any third party provide the same in order to compensate all or part of the client’s loss or increase the gain of the client.
      (9) Solicitation activities, etc., deemed or that may be considered inappropriate, lacking adequate protections for the customer in light of the customer’s level of knowledge, experience, status of assets, and purpose of entering into a financial instrument transaction contract.
      (10) Offering, etc., of interests in a collective investment scheme (fund) when the money subscribed or contributed by investors is not properly managed separately from the assets of the manager of the business charged with investing said money.
      (11) Offering, etc., of interests in a collective investment scheme (fund), knowing that invested monies or contributions will not be applied to the target business to which said invested monies or contributions should be applied.
      (12) In the case of an investment management business, making an investment management intended to conduct a transaction with the Financial Instruments Business Operator or a director or executive officer thereof.
      (13) In the case of an investment management business, making an investment management intended to conduct a transaction between investment properties.
      (14) In the case of an investment management business, making an investment management intended to engaging in ill-founded transactions in respect to specific financial instruments, financial indexes or options for the purpose of obtaining benefits for a third party other than itself or authorized beneficiaries by utilizing the fluctuations of prices, indexes, figures or an amount of consideration that would result from such transactions.
      (15) In the case of an investment management business, making an investment management intended to investing in transactions for which the terms and conditions are different from usual transactions and would be detrimental to the interests of investors.
      (16) In the case of an investment management business, selling or purchasing securities or engaging in other transactions in one’s own account by utilizing information obtained in the course of transactions made as an investment management business.
    • 7. Duties for investment management businesses in respect to fiduciary, exercise of reasonable care, management in segregated accounts and delivery of management reports.

  • (c) Administrative dispositions

    Administrative dispositions are established as follows:

    • 1. Business improvement orders to Financial Instruments Business Operator

      In respect to the operations or financial condition of the firms, the Prime Minister may order a Financial Instruments Business Operator to undertake necessary measures for changing the methods of operations or improving management efficiency or financial conditions, to the extent required, if it is considered to be necessary and appropriate for the protection of the public interest or investors.

    • 2. Revocation and business suspension orders to Financial Instruments Business Operator

      The Prime Minister may revoke the registration of a Financial Instruments Business Operator or order the suspension of all or part of its operations within a certain period not exceeding six months if the Financial Instruments Business Operator falls under any of the following:

      (1) When the Operator falls under grounds for rejecting the registration.
      (2) Fraudulently registered as a Financial Instruments Business Operator.
      (3) Violation of laws or regulations or administrative dispositions based on laws or regulations in connection with financial instrument businesses or operations incidental thereto.
      (4) High likelihood of insolvency in light of the operations or financial condition of the firm.
      (5) When a wrongful act or materially unjust act is conducted with regard to Financial Institution Business, and when the circumstances are especially serious.

V. Regulations for notifiers of SPBQII 10

FIEA stipulates the following regulations for those Notified Business Operators of SPBQII (“Notifier of SPBQII”).

  • (a) Grounds for Disqualification

    Any person that falls under any of the following (excluding Financial Instruments Business Operator) is prohibited from operating SPBQII.

    *The following only partially indicates the Grounds for Disqualification. Please refer to Section 7, Article 63 of FIEA for the full listing.

    • 1. Any person that falls under any of the following:

      (1) A person who has had his or her registration, etc., as a Financial Instruments Business Operator revoked or has received an order to terminate SPBQII, and for whom five years have not passed since the date of the revocation or order; or a person who has had his or her registration under foreign laws or regulations equivalent to FIEA revoked or has received an order to terminate similar business activities as SPBQII, and for whom five years have not passed since the date of the revocation or order.
      (2) A person who has filed for termination of his or her financial instruments business or SPBQII during the period between the date of a hearing notice regarding a revocation of registration as a Financial Instruments Business Operator or a termination of SPBQII, and the date of the decision whether to implement such penalty, and for whom five years have not passed since the filing.
      (3) A person who has been fined (including any similar penalty under laws or regulations of a foreign country) due to a violation of FIEA or other laws or regulations concerning the financial business or similar laws or regulations of a foreign country, for whom five years have not passed since the date of the implementation of the penalty or the penalty is no longer applicable.
    • 2. In the case of a corporation, a person that falls under any of the following:

      (1) An adult ward, a person under curatorship or the equivalent under foreign laws and regulations.
      (2) A person who has received a ruling to commence bankruptcy proceedings and his or her legal status has not been restored, or a person treated similarly under foreign laws and regulations.
      (3) A person who has received a penalty of imprisonment without labor or worse (including similar penalties under foreign laws and regulations), for whom five years have not passed since the penalty was imposed or the date when the penalty became no longer applicable.
      (4) In a case where a corporation, which was once a Financial Instruments Business Operator, (1)has had its financial instruments business registration, etc. revoked, or has received an order to terminate SPBQII operation, or (2)has had its registration, etc., under foreign laws or regulations similar to FIEA revoked, or has received an order to terminate business activities equivalent to the SPBQII operation, a person who was an officer of said corporation within 30 days before the revocation or order and for whom five years have not passed since the date of the revocation or order.
      (5) When an individual, who was once a Financial Instruments Business Operator, (1)has had his or her financial instruments business registration, etc. revoked, or has received an order to terminate SPBQII, or (2)has had his or her registration, etc., under foreign laws and regulations similar to FIEA revoked, or has received an order to terminate businesses equivalent to the SPBQII, and for whom five years have not passed since the date of the revocation or order.
      (6) A person who was an officer of a corporation that has filed for termination of its financial instruments business or SPBQII during the period between the date of a hearing notice regarding a revocation of registration as a Financial Instruments Business Operator or a termination of SPBQII, and the date of decision whether to implement the penalty, and for whom five years have not passed since the filing.
      (7) An individual to whom Section 1. (2) applies.
      (8) An officer discharged or dismissed under the provisions of FIEA or an officer discharged in accordance with the provisions of foreign laws and regulations equivalent to FIEA, and for whom five years have not passed since the date of the discharge.
      (9) A person who has been fined due to a violation of FIEA or other laws or regulations concerning the financial business or the Law for the Prevention of Unjust Acts by Organized Crime Group Members or equivalent foreign laws and regulations, or has been fined for a crime under the Penal Code or the Law for the Punishment of Physical Violence, etc. (including penalty under the equivalent foreign laws and regulations), and for whom five years have not passed since the imposition of the fine or the date when the penalty is no longer applicable.
      (10) When there is an officer or an employee as defined under the cabinet order who is an Organized Crime Group Member under Item 6, Article 2 of the “Act on Prevention of Unjust Acts by Organized Crime Group Members,” or an officer or an employee as defined under the cabinet order for whom five years have not passed since his or her de-classification as an Organized Crime Group Member (hereafter “Organized Crime Group Member, etc.”).
      (11) A foreign corporation without any representative in Japan.
      (12) A foreign corporation who does not obtained the guarantee on trading financial instruments as set out under Item 1, Section 2, Article 189 of FIEA, in accordance with the stipulation in Section 1 by a foreign supervising authority of any of the countries where its main business operator or office, or business offices that are engaged in SPBQII are located.
    • 3. An individual who falls under any of the following:

      (1) A person or an employee specified by the cabinet order, who falls under any of Section 2 (1) through (9)
      (2) An Organized Crime Group Member, etc., or a person who has an employee specified by a cabinet order who is an Organized Crime Group Member, etc.
      (3) An individual who is a resident of a foreign country and has not designated an agent in Japan
      (4) An individual who is a resident of a foreign country, and who does not obtained the guarantee on trading financial instruments as set out under Item 1, Section 2, Article 189 of FIEA, in accordance with the stipulation in Section 1 by a foreign supervising authority of any of the countries where its main business office or office, or business offices that are engaged in SPBQII are located.
  • (b) Conduct Control

    In principle, the Conduct Control for Financial Instruments Business Operators is also applicable to the those notifiers for SPBQII.

  • (c) Administrative dispositions

    The following are the rules regarding administrative dispositions.

    • 1. Business improvement orders to the Notified Operator of SPBQII Regarding the business operation of the Notified Operator of SPBQII, if it is considered necessary and appropriate for the purpose of protecting public interests and investors, the Prime Minister may order the taking of necessary measures to improve the operator’s business operation to the extent that it is necessary.

    • 2. Business suspension orders to the Notified Operator of SPBQII

      If the Notified Operator of SPBQII breaches laws and regulations in relation to SPBQII or the administrative dispositions based on the relevant laws and regulations, the Prime Minister may order the suspension of all or part of the operator’s businesses for a period of up to six months.

    • 3. Business abolition orders to the Notified Operator of SPBQII

      If the Notified Operator of SPBQII breaches laws and regulations in relation to SPBQII or the administrative dispositions based on the relevant laws and regulations, and the Authority is unable to achieve the goal of supervision by any other means, the Prime Minister may order the operator to abolish its business operations.

VI. Registration/notification requirement for fund business

Details of Funds Registration/Notification Requirement
Fund business investing in securities & derivatives When the operation falls under SPBQII Self-offering Notification under Section 2, Article 63 of FIEA as the operator of SPBQII
Self-management
When the operation does not fall under SPBQII Self-offering Registration under Article 29 of FIEA as a Financial Instruments Business Operator (Type II)
Self-management Registration under Article 29 of FIEA as a Financial Instruments Business Operator (investment management business)
Offering of funds established by other companies Registration under Article 29 of FIEA as a Financial Instruments Business Operator (Type II; including Type II Small Amount Electronic Offering Handling Business)
Management of funds established by other companies Registration under Article 29 of FIEA as a Financial Instruments Business Operator (investment management business)
Fund business investing in instruments other than securities and derivatives When the operation falls under SPBQII Self-offering Notification under Section 2, Article 63 of FIEA as an operator of SPBQII
Self-management No FIEA application
When the operation does not fall under SPBQII Self-offering Registration under Article 29 of FIEA as a Financial Instruments Business Operator (Type II)
Self-management No FIEA application
Offering of funds established by other companies Registration under Article 29 of FIEA as a Financial Instruments Business Operator (Type II; including Type II Small Amount Electronic Offering Handling Business)
Management of funds established by other companies No FIEA application

* SPBQII (Specially Permitted Businesses for Qualified Institutional Investors, etc.) means the self-directed offering or self-management of the interests in a collective investment scheme targeting one or more QIIs (professional) and 49 or less investors with capacity for investment decisions.

** Type II Small Amount Electronic Offering Handling Business operators mean those registered under Article 29 of FIEA and permitted to be engaged in offering of funds established by other companies by way of websites, etc., subject to eligibility criteria, including an aggregate issue amount of less than 100 million yen per fund, and less than 500,000 yen in investment amount per investor.

VII. Government offices for registration, notification and contact

Local Finance Bureau
Section in charge
Address Tel &
FAX No.
Email address
Kanto Local Finance Bureau
3rd Securities Business Surveillance Section
(For all foreign operators without office in Japan)
1-1 Shintoshin, Chuo-ku, Saitama-city, Saitama
330-9716 Japan
048-614-0044
(Direct)
Fax: 048-600-1232
syou.kan3@kt.lfb-mof.go.jp
Kinki Local Finance Bureau
2nd Securities Business Surveillance Section
4-1-76 Otemae, Chuo-ku, Osaka-city, Osaka 
540-8550 Japan
06-6949-6257
(Direct)
Fax: 06-6949-6120
kinki-syoukenkantoku@kk.lfb-mof.go.jp
Tokai Local Finance Bureau
Securities Business Surveillance Section
3-3-1 Sannomaru, Naka-ku, Nagoya-city, Aichi
460-8521 Japan
052-951-2498
(Direct)
Fax: 052-973-0261
tkz0952@tk.lfb-mof.go.jp
Hokkaido Local Finance Bureau
3rd Financial Business Surveillance Section
2-chome, Kita Hachijo Nishi, Kita-ku, Sapporo-city, Hokkaido, 060-8579 Japan 011-709-2311
(Switchboard) Ext. 4316
Fax: 011-746-0946
HKZKIN3KAOP@hk.lfb-mof.go.jp
Tohoku Local Finance Bureau
3rd Financial Business Surveillance Section
3-3-1 Honcho, Aoba-ku, Sendai-city, Miyagi
980-8436 Japan
022-263-1111
(Switchboard)
Ext. 3710
Fax: 022-261-1796
THZKIN3KAOP@th.lfb-mof.go.jp
Hokuriku Local Finance Bureau
1st Financial Business Surveillance Section
4-3-10 Shinkanda,
Kanazawa-city, Ishikawa 921-8508 Japan
076-292-7855
(Direct)
Fax: 076-292-7878
kinyuukantoku1@hr.lfb-mof.go.jp
Chugoku Local Finance Bureau
3rd Financial Business Surveillance Section
6-30 Kami-Hatchobori, Naka-ku, Hiroshima-city Hiroshima 730-8520 Japan 082-221-9221
(Switchboard)
Ext. 3488
Fax: 082-223-0479
TGZKIN3KAOP@tg.lfb-mof.go.jp
Shikoku Local Finance Bureau
1st Financial Business Surveillance Section
26-1 Nakano-cho, Takamatsu-city, Kagawa 760-8550 Japan 087-831-2131
(Switchboard)
Fax: 087-862-8798
sz-soumu@sk.lfb-mof.go.jp
Kyushu Local Finance Bureau
3rd Financial Business Surveillance Section
2-10-1 Kasuga, Nishi-ku, Kumamoto-city, Kumamoto 860-8585 Japan 096-206-9764
(Direct)
Fax: 096-359-2821
KINYUUKANNTOKUDAISANKA@ks.lfb-mof.go.jp
Fukuoka Local Financial Branch Bureau
3rd Financial Business Surveillance Section
2-11-1 Hakataeki-Higashi, Hakata-ku, Fukuoka-city, Fukuoka 812-0013 Japan 092-411-7281
(Switchboard)
Ext. 3716
Fax: 092-411-9290
https://lfb.mof.go.jp/mailform/fukuoka.phpopen new window (Mailform)
Okinawa General Bureau
Financial Business Surveillance Section
2-1-1 Omoromachi, Naha-city, Okinawa
900-0006 Japan
098-866-0095
(Direct)
Fax: 098-860-1152
kantoku@ogb.cao.go.jp

(For reference) Scope of Qualified Institutional Investors, etc. (QIIs)

A QII is an investor who has professional knowledge and experience relating to investment in securities. The following types of institutional investors are designated as QIIs:

(i) Financial Instruments Business Operators that deal with highly liquid securities such as stocks and bonds or that operate investment management business.
(ii) Financial institutions that accept deposits (restricted to entities notified with the Commissioner of the Financial Services Agency (FSA) for a credit cooperative and entities designated by the Commissioner of the FSA for agricultural and fishermen’s cooperatives).
(iii) Insurance companies.
(iv) Corporations that have securities balances of 1 billion yen or more and have notified to the Commissioner of the FSA.
(v) Individuals who have securities balances of 1 billion yen or more and one year has passed since the opening of their accounts and who have notified to the Commissioner of the FSA.
(vi) Corporations or individuals that operate a partnership under the Civil Code (with securities balances of 1 billion yen or more and the consent of other partners) and have notified to the Commissioner of the FSA.
(vii) Investment Limited Partnerships
  • Special purpose company (with an outstanding securities balance of 1 billion yen or more in specified assets under the Asset Securitization Plan) that have notified to the Commissioner of the FSA.
  • Venture capital companies (with 500 million yen or more in capital) that have notified to the Commissioner of the FSA.
(viii) Investment management-type trust companies that have notified to the Commissioner of the FSA

Footnotes

  • 1Restricted to race horses acquired by using in entirety cash, securities, bills of exchange or promissory notes invested or contributed by owners of beneficiary interests of trusts or interests in collective investment schemes (“funds”)return

  • 2Restricted in the case where operations relating to the Invested Business are conducted with the consent of all equity partners and that all equity partners either engage in said Invested Business on a full-time basis or contribute, their professional skills that are indispensable for maintaining Invested Business, although not on a full-time basis.return

  • 3Rights based on a contract in which officers and employees of an issuing company or those of an entity under the control of the issuing company (“officers and employees”) are committed to purchase shares of the company jointly with other officers and employees of the company on a regular basis in accordance with a specific purchase plan not based on individual investment decisions, where individual capital contributions per person are less than 1 million yen.return

  • 4All of the following must be satisfied.

    • 1. All equity partners are engaged in all or part of the target Invested Business in relation to said rights.

    • 2. All equity partners have the right to receive allocations of the income generated by the Invested Business or allocation of asset of the Invested Business in relation to said rights, as well as any of the following rights.

      (1) Rights to receive payments in return for their engagement in the target Invested Business.
      (2) In using the contents relating to the target Invested Business, rights to indicate the names of equity partners or rights to advertise the businesses of the equity partners.
    • 3. Transfer of the right is prohibited except in cases where rights are transferred to other investors or to persons other than investors with the consent of all other investors.return

  • 5All following requirements should be met.

    • 1. The following matters are included in the capital contribution contract:

      (1) A provision that all powers and rights of investment management are entrusted to a Financial Instruments Business Operator, etc. and the Name of Business or Name of such Operator.
      (2) Outline of the discretionary investment agreement and the amount of management fee when such fees arising from the discretionary investment agreement would be paid from portfolio assets or the calculation method for fees payable when the amount is not specifically established in advance.
    • 2. The following provisions are included in the capital contribution contract and the discretionary investment agreement:

      (1) The Financial Instruments Business Operator, etc. must operate its investment management for equity partners in good faith.
      (2) The Financial Instruments Business Operator, etc. must exercise reasonable care in the operation of its investment management for equity partners.
    • 3. The capital contribution contract and the discretionary investment agreement must include a provision that the Financial Instruments Business Operator, etc. cannot make transactions with its proprietary account, its directors, executive officers or other portfolio assets that are managed in its fund (as used in (1) and (2) below, “proprietary transaction”) without explaining all such transactions to each equity partner and obtaining the consent of all equity partners (Including the consent (1) below, in the case all provisions below are stipulated when the operator engages in the transaction).

      (1) The Financial Instruments Business Operator, etc. can trade proprietary transaction with the consent of more than half of all equity partners (Note: a higher proportion may be stipulated) and more than three-fourths of the interests owned by all equity partners (Note: a higher proportion may be stipulated) and
      (2) When an equity partner who does not consent to proprietary transaction requests cancellation within 20 days from the date of the explanation of the transaction (Note: a longer period may be stipulated), the person should repurchase the interests owned by such equity partner at fair value from portfolio assets (and terminate the agreement relating to such interests) within 60 days from the date of the proprietary transaction (Note: a shorter period may be stipulated).
    • 4. The person is to manage his/her portfolio assets, proprietary account and other assets under his/her management separately under the supervision of the Financial Instruments Business Operators, etc.

    • 5. When there is any change to the matters registered with respect to the person, the Financial Instruments Business Operators, etc. must immediately submit the amendments to the Local Finance Bureau.return

  • 6(1) Name of Business, denomination or Name (2) For a corporation, capital amount or total amount of contribution and name or denomination of officers (3) When an employee is responsible for compliance or an employee has the right to represent such authority, names of such employees (4) Name and address of principal business office or offices (5) When it operates other business, the type of such businesses.return

  • 7All of the following requirements should be met.

    1. When a party of the Silent Partnership Contract is a business person of another Silent Partnership Contract and he/she is also a Financial Instruments Business Operators, etc. (only those operating investment management business), a notifier of SPBQII operation (only those operating investment management) or a notifier of Specially-Permitted Investment Management Business operation.
    2. When any notified matters relating to the person are changed, a party of the Silent Partnership Contract provides amendments to the authority without delay.return
  • 8When a client is a specific investor (professional investors such as QIIs, the government and Bank of Japan), the following regulations on conduct of business are not applied: regulations of advertisements, delivery of a written document before entering a contract, delivery of a written document at the contract stage, a part of regulated actions and delivery of a management report.return

  • 9Note that if the fund falls under any of the following types, additional items are required to be listed.

    1. When the fund mainly invests in trust certificates, etc., matters specified in all items under Section 1, Article 84 of the Cabinet Office Ordinance on Financial Instruments Business, etc.
    2. When the fund is based on a partnership agreement, a Silent Partnership Contract or an Investment Limited Partnership agreement and its main business is investment in real estate trust certificates, matters specified in all items in Section 1, Article 84 and Section 1, Article 85 of the Cabinet Office Ordinance on Financial Instruments Business, etc.
    3. When the fund is engaged in a business other than one that mainly invests in vested rights on securities or derivative transactions, matters specified in all items in Section 1, Article 92-2 of the Cabinet Office Ordinance on Financial Instruments Business, etc.return
  • 10Business operators that notified the SPBQII operation before March 1, 2016, and have been engaged in self-management of interests in the collective investment scheme (fund) (only for solicitation activities commenced before March 1, 2016) may be applicable to certain transition measures. Please see here for detailed information.return

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