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October 27, 2020
Financial Services Agency

Update on Progress toward Further Efficiency and Transparency in the Screening Procedures for Licensing and Registration of Financial Businesses

Since the 2016 fiscal year, the Financial Services Agency (FSA) has indicated its policy direction to “execute proper progress management for registration/licensing procedures through listing for greater efficiency and transparency of financial regulation,” and has announced its action plan and specific initiatives.*
  https://www.fsa.go.jp/en/news/2019/20190927.html (FSA website)
(1) Major initiatives since the last announcement on September 27, 2019, are as follows:
○ From the viewpoint of revising report frequency and abolishing reports:
・Revised “number of information provisions of unauthorized use of savings accounts” report frequency(https://www.fsa.go.jp/news/r1/ginkou/20200430-2.html)
○ From the viewpoint of optimizing, expediting, and clarifying the approval examination process:
・Published revised questionnaires relating to the registration review of crypto-asset exchange service providers on the FSA website(https://www.fsa.go.jp/news/r1/virtualcurrency/20200403-1.html)
・Published Guidebook for Registration of Investment Management Business and Other Financial Instruments Business on the FSA website (https://www.fsa.go.jp/policy/marketentry/guidebook.html)
(2) Since November 2018, the FSA took a survey of financial institutions that have been registered regarding the examination response of the relevant authorities.
○ The questionnaire was sent to over 150 financial institutions, and 122 replies were received from June last year to May this year. The questionnaire response rate was approximately 75%.
○ The questionnaire contained the following five questions. Responses were numbered from 1 to 4, with 1 being the highest rating.
1. Did you receive an easy-to-understand explanation of the application procedure (including the writing style of the written application)?
2. Did you find that consideration was taken to avoid making the task of filling out and presenting the written applications overly burdensome (example: applicant scale, location in Japan taken into consideration)?
3. Did you receive an easy-to-understand explanation of the main points of the examination (example: systems prioritized for establishment)?
4. Was the viewpoint of the examination reasonable (example: you felt that the unified opinion of the organization was being indicated, as opposed to the opinion of the individual person in charge)?
5. Did the person in charge of the examination make an effort to quickly answer the applicant’s inquiries, where there were no special circumstances?

○ The average score of responses was 1.5, with the breakdown as follows (the average score of responses last year was also 1.5):
  Respondents who answered 1 Respondents who answered 2 Respondents who answered 3 Respondents who answered 4 Average score
Q.1 72 41 9 0 1.5
Q.2 62 49 9 1 1.6
Q.3 70 43 7 2 1.5
Q.4 74 36 10 2 1.5
Q.5 85 28 7 1 1.4
Total 363 197 42 6 1.5

○ In the free answer section, regarding examination response of the relevant authorities, positive comments included “response is good” while comments on points for improvement included “the intention of pointing out is not clear.”
※ Since some respondents did not answer all the questions, the number of respondents per question may not be the same.
We intend to use the answers and opinions we have received in our future financial administration to make the examination process more efficient.


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