FSA Weekly Review No.580 March 28, 2024

FSA Weekly Review No.580: March 28, 2024

What’s New on the FSA Website

Week of March 15, 2024 - March 21, 2024

This page contains the latest in events, developments, and updates to the FSA website.

Public Comments

March 15, 2024	Publication of the draft amendments to the "Guidelines for Administrative Processes" regarding prepaid payment instruments issuers and funds transfer service providers for public consultation <Summary> The FSA proposed the draft amendments to the "Guidelines for Administrative Processes" regarding prepaid payment instruments issuers and funds transfer service providers (hereinafter referred to as the "proposal") for public consultation. The proposal mainly intends to set forth the following in the Guidelines: - Response to the revision of the regulations on posting notices, stipulated in relevant and applicable Cabinet Office Orders that are within the purview of the FSA, and - Measures that should be taken against unregistered financial services providers (those who engage in foreign exchange transactions without obtaining a license under the Banking Act or registration as a funds transfer service provider under the "Payment Services Act"). Public comments will be accepted until 5:00 p.m. [JST], April 15, 2024. The original press release is available in Japanese.

March 15, 2024

Publication of the draft amendments to the "Guidelines for Administrative Processes" regarding prepaid payment instruments issuers and funds transfer service providers for public consultation
<Summary>
The FSA proposed the draft amendments to the "Guidelines for Administrative Processes" regarding prepaid payment instruments issuers and funds transfer service providers (hereinafter referred to as the "proposal") for public consultation.
The proposal mainly intends to set forth the following in the Guidelines:

- Response to the revision of the regulations on posting notices, stipulated in relevant and applicable Cabinet Office Orders that are within the purview of the FSA, and

- Measures that should be taken against unregistered financial services providers (those who engage in foreign exchange transactions without obtaining a license under the Banking Act or registration as a funds transfer service provider under the "Payment Services Act").

Public comments will be accepted until 5:00 p.m. [JST], April 15, 2024.

The original press release is available in Japanese. open new window

Press Releases

Policies

March 15, 2024	Submission of a "bill on the promotion of cash flow-based lending" to the 213th ordinary Diet session <Summary> The FSA submitted a "bill on the promotion of cash flow-based lending" to the 213th ordinary Diet session. The said bill is aimed at making it easier for corporate borrowers (business owners) to take loans from financial institutions, where the financial institutions are encouraged to provide loans based on the accurate understanding of the businesses’ actual conditions and future cash flow instead of easily depending on tangible asset collateral, such as real estate, or personal guarantees. The bill mainly intends to set forth the following in terms of the promotion of cash flow-based lending: (1) to establish a new collateral system covering the entirety of the businesses' assets, including intellectual property and intangible assets, and (2) to establish a government headquarter, and formulate basic principles. The original press release is available in Japanese.
March 15, 2024	Submission of a "bill to partially amend the Financial Instruments and Exchange Act and the Act on Investment Trusts and Investment Corporations" to the 213th ordinary Diet session <Summary> The FSA submitted a "bill to partially amend the Financial Instruments and Exchange Act and the Act on Investment Trusts and Investment Corporations" to the 213th ordinary Diet session. The bill is intended to enhance and diversify asset management while ensuring transparency and fairness in the market in terms of the following: (1) to add transactions by means of involving an auction on exchanges to the scope of the Tender Offer Rule (2) to clarify the scope of persons who are required to aggregate their shareholdings (ownership ratio) under the Large Shareholding Reporting Rule, and (3) to establish a voluntary registration system for financial business operators that conduct part of the services related to the investment management business on commission. The original press release is available in Japanese.

March 15, 2024

Submission of a "bill on the promotion of cash flow-based lending" to the 213th ordinary Diet session
<Summary>

The FSA submitted a "bill on the promotion of cash flow-based lending" to the 213th ordinary Diet session.

The said bill is aimed at making it easier for corporate borrowers (business owners) to take loans from financial institutions, where the financial institutions are encouraged to provide loans based on the accurate understanding of the businesses’ actual conditions and future cash flow instead of easily depending on tangible asset collateral, such as real estate, or personal guarantees.
The bill mainly intends to set forth the following in terms of the promotion of cash flow-based lending:

(1) to establish a new collateral system covering the entirety of the businesses' assets, including intellectual property and intangible assets, and

(2) to establish a government headquarter, and formulate basic principles.

The original press release is available in Japanese. open new window

March 15, 2024

Submission of a "bill to partially amend the Financial Instruments and Exchange Act and the Act on Investment Trusts and Investment Corporations" to the 213th ordinary Diet session
<Summary>

The FSA submitted a "bill to partially amend the Financial Instruments and Exchange Act and the Act on Investment Trusts and Investment Corporations" to the 213th ordinary Diet session.
The bill is intended to enhance and diversify asset management while ensuring transparency and fairness in the market in terms of the following:

(1) to add transactions by means of involving an auction on exchanges to the scope of the Tender Offer Rule

(2) to clarify the scope of persons who are required to aggregate their shareholdings (ownership ratio) under the Large Shareholding Reporting Rule, and

(3) to establish a voluntary registration system for financial business operators that conduct part of the services related to the investment management business on commission.

The original press release is available in Japanese. open new window

International

March 19, 2024	Impact Forum
March 18, 2024	Contribution of “Changing dynamics - How should regulators respond to new challenges” to the Eurofi Magazine
March 18, 2024	A speech on “Changing Dynamics - How should regulators respond to new challenges” at the Eurofi High Level Seminar 2024
March 15, 2024	Asia GX（Green Transformation）Consortium holds kick-off meeting

Councils

March 19, 2024	The first meeting of the Working Group on Disclosure and Assurance of Sustainability-related Financial Information (of the Financial System Council)
March 18, 2024	Publication of the agenda, handouts, and an outline of proceedings of the eighth and ninth meetings of "Advisory Council on Scenario Data for Climate Change Risk and Opportunity Assessment" (provisional English title) <Summary> The FSA, as a co-host member of the secretariat* of the "Advisory Council on Scenario Data for Climate Change Risk and Opportunity Assessment" (provisional English title), published the agenda, handouts, and outlines of proceedings of the eighth and ninth meetings of the Advisory Council, which were held on November 16, 2023, and February 7, 2024, respectively. In the eighth meeting, a consulting firm and others gave a presentation on the current implementation status of corporate initiatives taken for climate change risk assessment, whereupon the participants exchanged opinions based on the topics presented. In the ninth meeting, guest professionals (including professionals of research and education agencies and institutes from the public sector) gave presentations on their initiatives taken for climate change risk assessment, whereupon the participants exchanged opinions based on the topics presented. The secretariat of the Advisory Council* is co-hosted by the FSA, Ministry of Education, Culture, Sports, Science and Technology, Ministry of Land, Infrastructure, Transport and Tourism, and Ministry of the Environment, with representatives from the financial and non-financial sectors as Advisory Council members, and representative officials from the relevant government ministries and agencies as observers. **The Advisory Council is aimed at exchanging opinions on climate change-related data among stakeholders in the public and private sectors regarding their needs, challenges, and future directions to appropriately use climate change-related data, thereby effectively responding to climate change. The original press releases are available in Japanese. (1)(2)(3)(4)

March 19, 2024

The first meeting of the Working Group on Disclosure and Assurance of Sustainability-related Financial Information (of the Financial System Council)

March 18, 2024

Publication of the agenda, handouts, and an outline of proceedings of the eighth and ninth meetings of "Advisory Council on Scenario Data for Climate Change Risk and Opportunity Assessment" (provisional English title)
<Summary>
The FSA, as a co-host member of the secretariat* of the "Advisory Council on Scenario Data for Climate Change Risk and Opportunity Assessment" (provisional English title), published the agenda, handouts, and outlines of proceedings of the eighth and ninth meetings of the Advisory Council, which were held on November 16, 2023, and February 7, 2024, respectively.

In the eighth meeting, a consulting firm and others gave a presentation on the current implementation status of corporate initiatives taken for climate change risk assessment, whereupon the participants exchanged opinions based on the topics presented.

In the ninth meeting, guest professionals (including professionals of research and education agencies and institutes from the public sector) gave presentations on their initiatives taken for climate change risk assessment, whereupon the participants exchanged opinions based on the topics presented.

*The secretariat of the Advisory Council** is co-hosted by the FSA, Ministry of Education, Culture, Sports, Science and Technology, Ministry of Land, Infrastructure, Transport and Tourism, and Ministry of the Environment, with representatives from the financial and non-financial sectors as Advisory Council members, and representative officials from the relevant government ministries and agencies as observers.

**The Advisory Council is aimed at exchanging opinions on climate change-related data among stakeholders in the public and private sectors regarding their needs, challenges, and future directions to appropriately use climate change-related data, thereby effectively responding to climate change.

The original press releases are available in Japanese. (1)(2)(3)(4) open new window

Securities

March 15, 2024	Administrative monetary penalty against ITbook Holdings Co., Ltd. for making false statements in its securities reports and so forth <Summary> On March 14, 2024, the FSA issued an order to impose an administrative monetary penalty against ITbook Holdings Co., Ltd. for making false statements in its securities reports and so forth, in violation of the "Financial Instruments and Exchange Act." The original press release is available in Japanese.

March 15, 2024

Administrative monetary penalty against ITbook Holdings Co., Ltd. for making false statements in its securities reports and so forth
<Summary>
On March 14, 2024, the FSA issued an order to impose an administrative monetary penalty against ITbook Holdings Co., Ltd. for making false statements in its securities reports and so forth, in violation of the "Financial Instruments and Exchange Act."

The original press release is available in Japanese. open new window

Insurance

March 15, 2024	Authorization of the merger of AXA Life Insurance Co., Ltd. and AXA Direct Life Insurance Co., Ltd. <Summary> The FSA authorized the merger of AXA Life Insurance Co., Ltd. and AXA Direct Life Insurance Co., Ltd., pursuant to the "Insurance Business Act." The corporate name of the post-merger surviving company will be AXA Life Insurance Co., Ltd. The original press release is available in Japanese.

March 15, 2024

Authorization of the merger of AXA Life Insurance Co., Ltd. and AXA Direct Life Insurance Co., Ltd.
<Summary>
The FSA authorized the merger of AXA Life Insurance Co., Ltd. and AXA Direct Life Insurance Co., Ltd., pursuant to the "Insurance Business Act." The corporate name of the post-merger surviving company will be AXA Life Insurance Co., Ltd.

The original press release is available in Japanese. open new window

Others

March 15, 2024	Publication of the main issues raised by the FSA at opinion exchange meetings with relevant associations in the financial sector <Summary> The FSA has published the main issues raised by the FSA at opinion exchange meetings* held with relevant associations in the financial sector in February 2024. (Available only in Japanese). A common topic across the groups was: - AML/CFT (Anti-Money Laundering and Combating the Financing of Terrorism) measures [including the enhancement of corporate public relations in terms of AML/CFT measures and the development of risk management systems]. Notable issues discussed by most but not all groups were: - Japan Financial Literacy and Education Corporation (J-FLEC) - Financial Policies Monitor System - Finalized amendments to "Handling Guidelines for Business Operators that Fall within the Purview of the FSA to Eliminate Discrimination against People with Disabilities" and "Handling Directions for the FSA Officials to Eliminate Discrimination against People with Disabilities" [provisional English titles] - Financial measures to deal with disasters caused by the Noto Peninsula Earthquake in 2024, financial measures to deal with disasters caused by the heavy snow, etc. that started on January 23, 2024, and facilitation of financing for corporate borrowers affected by disasters - Japan Fintech Week 2024 - Policy Plan for Promoting Japan as a Leading Asset Management Center * To enhance the transparency of its administration and to share its awareness of issues in the financial sector in a timely manner, every month the FSA publishes the main issues raised by the FSA at opinion exchange meetings with the relevant associations in the financial sector. Opinion exchange meetings are held with the respective associations on a regular basis. In February 2024, opinion exchange meetings were held respectively with the following seven groups: major banks, etc.; the Regional Banks Association of Japan and the Second Association of Regional Banks; Community Bank, Shinyo Kumiai (National Central Society of Credit Cooperatives); the Life Insurance Association of Japan; the General Insurance Association of Japan; the Japan Investment Advisers Association; and the Labor banks sector. The original press release is available in Japanese.
March 15, 2024	Updated web portal for information on economic security measures to be taken in the financial sector <Summary> The FSA updated a web portal for information on economic security measures to be taken in the financial sector, by updating "Answers to Frequently Asked Questions Regarding the 'Regulatory System for Ensuring Stable Provision of Specified Social Infrastructure Services'" (provisional English title) [available only in Japanese] (hereinafter referred to as the "FAQ"). The updated FAQ is expected to further contribute to the smooth implementation of the said regulatory system under the "Act on the Promotion of Ensuring Economic Security Through Implementation of Integrated Economic Measures" (i.e. the "Economic Security Promotion Act" [provisional English title]). This Regulatory System is a core infrastructure system and is scheduled to be implemented on May 17, 2024. The original press release is available in Japanese.

March 15, 2024

Publication of the main issues raised by the FSA at opinion exchange meetings with relevant associations in the financial sector
<Summary>
The FSA has published the main issues raised by the FSA at opinion exchange meetings* held with relevant associations in the financial sector in February 2024. (Available only in Japanese).

A common topic across the groups was:

- AML/CFT (Anti-Money Laundering and Combating the Financing of Terrorism) measures [including the enhancement of corporate public relations in terms of AML/CFT measures and the development of risk management systems].

Notable issues discussed by most but not all groups were:

- Japan Financial Literacy and Education Corporation (J-FLEC)

- Financial Policies Monitor System

- Finalized amendments to "Handling Guidelines for Business Operators that Fall within the Purview of the FSA to Eliminate Discrimination against People with Disabilities" and "Handling Directions for the FSA Officials to Eliminate Discrimination against People with Disabilities" [provisional English titles]

- Financial measures to deal with disasters caused by the Noto Peninsula Earthquake in 2024, financial measures to deal with disasters caused by the heavy snow, etc. that started on January 23, 2024, and facilitation of financing for corporate borrowers affected by disasters

- Japan Fintech Week 2024

- Policy Plan for Promoting Japan as a Leading Asset Management Center

* To enhance the transparency of its administration and to share its awareness of issues in the financial sector in a timely manner, every month the FSA publishes the main issues raised by the FSA at opinion exchange meetings with the relevant associations** in the financial sector. Opinion exchange meetings are held with the respective associations on a regular basis.

** In February 2024, opinion exchange meetings were held respectively with the following seven groups: major banks, etc.; the Regional Banks Association of Japan and the Second Association of Regional Banks; Community Bank, Shinyo Kumiai (National Central Society of Credit Cooperatives); the Life Insurance Association of Japan; the General Insurance Association of Japan; the Japan Investment Advisers Association; and the Labor banks sector.

The original press release is available in Japanese. open new window

March 15, 2024

Updated web portal for information on economic security measures to be taken in the financial sector
<Summary>
The FSA updated a web portal for information on economic security measures to be taken in the financial sector, by updating "Answers to Frequently Asked Questions Regarding the 'Regulatory System for Ensuring Stable Provision of Specified Social Infrastructure Services'*" (provisional English title) [available only in Japanese] (hereinafter referred to as the "FAQ").
The updated FAQ is expected to further contribute to the smooth implementation of the said regulatory system under the "Act on the Promotion of Ensuring Economic Security Through Implementation of Integrated Economic Measures" (i.e. the "Economic Security Promotion Act" [provisional English title]).

*This Regulatory System is a core infrastructure system and is scheduled to be implemented on May 17, 2024.

The original press release is available in Japanese. open new window

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