Press Conference by Shozaburo Jimi, Minister for Financial Services
(Friday, December 24, 2010, from 11:15 a.m. to 11:28 a.m.)
[Opening Remarks by Minister Jimi]
I was notified that another Cabinet meeting is scheduled for 6:00 p.m. today.
[Questions & Answers]
I would like to ask two questions.
The first one relates to the idea of a comprehensive exchange. Given that the related authorities reached an agreement on centralized supervision last Friday, what do you think of that arrangement? On the other hand, seeing as there has been no specific discussion of any approach to supervision as to which ministry or agency will assume what responsibility, please also let us know the schedule, if there is one, for the work of coordination in the future.
There was a development two nights ago that is related to the question you have just asked: the Comprehensive Exchange Study Team, which consists of Senior Vice Ministers and Parliamentary Secretaries of the Financial Services Agency (FSA), the Ministry of Agriculture, Forestry and Fisheries (MAFF) and the Ministry of Economy, Trade and Industry (METI), put together an interim summary. I would like to express my deep gratitude to the members who enthusiastically attended the meetings - a total of six official meetings were held in the short period of less than two months, starting with the first meeting on October 28 - and also convened impromptu meetings or kept in contact by phone to put together the interim summary.
Some of the topics addressed in the interim summary are still left without any collective view formed. As stated at the beginning of the interim summary, it has been agreed that the initiative will be carried out under a common vision that a comprehensive exchange should be realized. A discussion is scheduled to be resumed after the New Year holidays once opinions and other inputs are collected from market players. The FSA is committed to making efforts that lead to the creation of a comprehensive exchange that would actually be used by market players.
Frankly, it is a very challenging endeavor. When three ministries are involved, things are just not simple. Although the Senior Vice Ministers and Parliamentary Secretaries of the three ministries are toiling away, the fact is that they each have their own position and are therefore faced with a challenge of deciding who should regulate the exchange. There is a widespread global trend toward regulating various markets together, as is the case in both the U.S. and Europe. To be blunt, from the perspective of us politicians, it is an issue associated with interests of the respective ministries, which we are struggling hard to coordinate.
After all, considering that the reason behind the recent change of administration was a desire for politician-led government, I feel that this is precisely the issue to be dealt with under a politician-led initiative. We have been having a very hard time so far. This endeavor would never have come up in the mind of any Cabinet member of a Liberal Democratic Party (LDP) administration in the past and would therefore have likely been crushed a long time ago. However, the current administration's approach is to work patiently. Given the widespread global trend in favor of a comprehensive exchange as well, we are quite determined to have the respective ministries have a good understanding of that point and proceed beyond any interest specific to their own ministry.
My second question relates to secondary losses of jusen companies. I previously asked about this issue as well, about which Bank of Japan Governor Shirakawa presented his view during a press conference last week, specifically on December 21, that they should be disposed of under a fifty-fifty public-private sharing structure. While this fifty-fifty public-private sharing was the favored course of action in the days of the LDP administration, I cannot see clearly how the new administration is intending to deal with this issue. Is there going to be a change to the previous position? Please give us your view with regard to this point.
I have a stark memory of the circumstances around jusen loan claims - well, I am sure that all of you know that the RCC (Resolution and Collection Corporation) is in the process of developing a disposal plan designed to complete the debt collection and other related procedures by December 2011 in accordance with law. The RCC is currently working hard to collect debts to minimize the burden on taxpayers, taking into account, at the same time, the circumstances of debtors, and the FSA is also examining ways how to eventually close the RCC's jusen account.
At this time, I cannot say anything definite about the prospect of any approach or otherwise with respect to the disposal of the secondary losses from jusen loan claims, but I am hoping to proceed with the work of deliberation, holding adequate discussions with stakeholders as we go. Another point I would like to make is that, naturally, all actions must, in principle, be taken in accordance with law. That said, I am intending to proceed with the work of deliberation while I ensure adequate discussions with stakeholders along the way.
Can I take it that the work of deliberation will not be bound by the fifty-fifty public-private sharing framework contemplated in the days of the LDP administration, but the matter will be reviewed anew?
No, that is not what I meant. As I was a Diet member of the ruling party back then, I know how the things developed and unfolded then. I still find the fifty-fifty public-private sharing structure to be important.
As, however, the fifty-fifty public-private sharing arrangement, if realized, will still lead to a complex set of conflicts of interest forming between different industries in the private sector, I suspect that a decision about specifics of the burden-sharing will not be so easy to come by. In any case, I am intending to deliberate the matter according to the letter of the law.
There have been voices raised about the possible confusion emerging from the fact that a series of stationery store or music store gift certificates, or so-called kinken (cash vouchers) in general, are expiring one after another. Seeing that this is an issue associated with the Payment Services Act, I would like to have your opinion on this. Also in relation to the same issue, some criticize that general consumers may not be informed of the existence of the Act itself in the first place or that the refund period set by statute, which can apparently be as short as 60 days after a public notice, may be the source of the problem - can I please confirm if there is any specific step or action slated to be taken to address this issue in the future, or any policy of that sort?
I also read in today's newspaper the article that you have alluded to. What are called kinken are regulated under the Payment Services Act that requires a kinken issuer to reimburse the holder of a kinken for its face value when the issuer discontinues the use of the kinken. There is also a requirement, naturally, that in the case of refunds, the issuer should issue a public notice in a daily newspaper or post a notice in the places of business, etc. of dealers, indicating its decision to give refunds, together with other related information. The FSA is committed to providing supervision to make sure that each issuer responds attentively to any consultation or other requests from kinken holders and that public notices and other means of notification should be implemented properly in accordance with prescribed procedures so as not to cause any confusion among holders, as we also work on communicating refund period information to the broader public.
Is there any specific step in place?
In my view, thorough communication is the first key. I believe that it was the Yomiuri Shimbun that published an article on this today, which also included a frank reference to the lack of thorough communication. I would appreciate it if the media could kindly understand about making their own effort to communicate such information thoroughly.
Back to the subject of a comprehensive exchange, you mentioned that the matter should be dealt with under a politician-led initiative. It seems to me that precisely because this represents a fight to protect ministerial interests, the Democratic Party of Japan (DPJ) administration's approach to politician-led government is being tested. If the issue were to be left unsolved and stuck around into the new year, that very approach to politician-led government might be questioned - this being how I sum up the situation, please give us your view as to whether or not the issue can be worked out as it should be.
I am a Diet member from the People's New Party (PNP) and not from the DPJ, but am committed to firmly sticking to the three-party pact on the "super manifest" for the coalition government. We formed the coalition on the basis of a thorough understanding of the politician-led governing approach. As a politician, and also as a Minister, I am intensely conscious of the weightiness of the politician-led approach.
I am Takahashi, a freelance journalist.
Recently, the publishing world has seen a stream of books come out one after another that have a tone of accusation against those who represent a pro-U.S. stance, including "Heizo Takenaka Is the One Who Needs to Testify" by Makoto Sataka, "'Defeat and Fall' of a BOJ Elite" by Takashi Arimori, which is a book denouncing Takeshi Kimura, and "Japan's Independence" by Kazuhide Uekusa. What is occurring parallel to this trend is the recent increase in the number of comments posted on the Internet in support of PNP, of which Mr. Kamei is the chief, or Minister Jimi. In view of the unfolding turn of events, including the establishment of an inspection committee for the Incubator Bank of Japan, please let us know how you consider the state of affairs that I just described?
DPJ, the Social Democratic Party and PNP together issued the three-party pact. This represents a common policy of the three parties issued on August 16 of last year in the run-up to the election. It was developed in the circumstances in which excessive regulatory reforms implemented by Mr. Koizumi, coupled with excessive market fundamentalism, had brought much instability to the lives of the Japanese people. That is the basic premise of this coalition government. Subsequently, after winning the election, we articulated the idea into the three-party pact. I find it a positive thing that the people are voicing various opinions in line with the cause. And we have made a decision to set up an inspection committee. I believe that it is necessary to properly inspect any significant incident on a case-by-case basis.
Thank you very much.
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