Financial Services AgencyFSA Weekly Review No.490

May 26, 2022

What’s New on the FSA Website

Week of May 13, 2022 - May 19, 2022

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

Press Conferences

May 19, 2022 Press Conference by the Minister of State for Financial Services (April 15, 2022)

Public Comments

May 18, 2022 Publication of the finalized "Cabinet Order to Amend the Order for Enforcement of the Financial Instruments and Exchange Act" after public consultation
<Summary>
The FSA published the finalized "Cabinet Order to Amend the Order for Enforcement of the Financial Instruments and Exchange Act" after public consultation. In response to the recommendation stated in the report of the "Task Force to Discuss Optimal Ways to Ensure Best Execution" of the Financial System Council (published in June 2021) to review/amend the regulations on the "Best Execution Policy," the finalized Cabinet Order provides corresponding amendments to the "Order for Enforcement of the Financial Instruments and Exchange Act," "Cabinet Office Order on Financial Instruments," and the "Comprehensive Guidelines for Supervision of Financial Instruments Business Operators."
The finalized Cabinet Order alongside the said Order for Enforcement and the Comprehensive Guidelines will either be enforced or take effect on January 1, 2023.

The original press release is available in Japanese at the following URL.
https://www.fsa.go.jp/news/r3/shouken/20220518/20220518.htmlopen new window
May 13, 2022 Publication of the draft regulatory notice designating information and methods for provision or publication pursuant to the provisions of Article 2, Paragraph 1, Item 3, etc. of the "Cabinet Office Order on the Provision or Publication of Securities Information, etc." for public consultation
<Summary>
The FSA has published the draft regulatory notice designating information and methods for provision or publication pursuant to the provisions of Article 2, Paragraph 1, Item 3, etc. of the "Cabinet Office Order on the Provision or Publication of Securities Information, etc." for public consultation.
While the self-regulatory rules of Japan Securities Dealers Association (JSDA) pertaining to the solicitation of unlisted securities to professional investors, which had been on the review for the development and revision, are scheduled to take effect on July 1, 2022, the proposal intends to set forth a new regulatory notice designating the self-regulatory rules of JSDA with respect to matters to be designated by the FSA in the "Cabinet Office Order on the Provision or Publication of Securities Information, etc."
Public comments will be accepted until 5:00 p.m. (JST), June 13, 2022.

The original press release is available in Japanese at the following URL.
https://www.fsa.go.jp/news/r3/shouken/20220513/20220513.htmlopen new window
May 13, 2022 Publication of the draft amendments to the relevant applicable Cabinet Orders and others which are within the purview of the FSA, pertaining to the partial  enforcement of the "Act Partially Amending the Companies Act" and the "Act on Arrangement of Relevant Acts Incidental to the Enforcement of the Act Partially Amending the Companies Act" for public consultation
<Summary>
The FSA published the draft amendments to the relevant applicable Cabinet Orders and others which are within the purview of the FSA, pertaining to the partial enforcement of the "Act Partially Amending the Companies Act" and the "Act on Arrangement of Relevant Acts Incidental to the Enforcement of the Act Partially Amending the Companies Act" for public consultation. (The partial amendments to the said Acts are scheduled to be enforced on September 1, 2022).
The proposal mainly intends to provide technical amendments to the relevant applicable Cabinet Orders and others which are within the purview of the FSA, to reflect changes in the said Acts.

The original press release is available in Japanese at the following URL.
https://www.fsa.go.jp/news/r3/sonota/20220513/20220513.htmlopen new window

Press Releases

Councils

May 16, 2022 The ninth meeting of the Working Group on Corporate Disclosure of the Financial System Council 
May 19, 2022 Publication of the agenda and handouts of the 18th meeting of the "Working Group on Capital Market Regulations" (provisional English title) of the Financial System Council
<Summary>
The FSA published the agenda and handouts of the 18th meeting of the "Working Group on Capital Market Regulations" (provisional English title) of the Financial System Council, which was held on May 20, 2022. The working group members discussed key issues based on the discussions held by the working group since October 2021.

The original press release is available in Japanese at the following URL.
https://www.fsa.go.jp/singi/singi_kinyu/market-system/siryou/20220520.htmlopen new window
May 13, 2022 Publication of the agenda and handouts of the 27th meeting of the "Council of Experts Concerning the Follow-up of Japan's Stewardship Code and Japan's Corporate Governance Code" alongside the updated council members list
<Summary>
The FSA published the agenda and handouts of the 27th meeting of the "Council of Experts Concerning the Follow-up of Japan's Stewardship Code and Japan's Corporate Governance Code," which was held on May 16, 2022.
The council members discussed topics, such as, interim review following the 2021 revision of the Corporate Governance Code, challenges for sustainable growth, and issues related to dialogue between companies and investors.
In addition, the FSA published an updated list of the council members.

The original press release is available in Japanese at the following URL.
https://www.fsa.go.jp/singi/follow-up/siryou/20220516.htmlopen new window

 

Banks

May 17, 2022 Outline of the "Reports on the Measures for the Resolution of Failed Financial Institutions" delivered by the Minister of State for Financial Services, SUZUKI Shunichi, in the Committee on Financial Affairs of the House of Representatives
<Summary>
The Minister of State for Financial Services, SUZUKI, Shunichi, delivered an outline of the "Reports on the Measures for the Resolution of Failed Financial Institutions" in the Committee on Financial Affairs of the House of Representatives. The reports, addressing two semiannual periods extending from October 1, 2020 to September 30, 2021, had been submitted to the Diet respectively on June 18 and December 17, 2021, pursuant to the "Act on Emergency Measures for the Revitalization of the Financial Functions."

The original press release is available in Japanese at the following URL.
https://www.fsa.go.jp/common/diet/houkoku/040517/20220517.htmlopen new window

 

Others

May 19, 2022 Publication of the agenda of the first meeting of the "Study Group on Impact Investment – Phase 2"
<Summary>
The FSA published the agenda of the first meeting of the "Study Group on Impact Investment – Phase 2,"* which was held on March 3, 2022, co-hosted by the FSA and the National Advisory Board of the Global Steering Group for Impact Investment (GSG-NAB Japan). The Study Group meets regularly (on a trimonthly basis) to deepen the understanding of "impact investment" among capital market participants and government authorities. Handouts of the first meeting are available on the webpage of GSG-NAB Japanopen new window.
 

*Phase 1 meetings of the said study group were held seven times between June 2020 and September 2021.


The original press release is available in Japanese at the following URL.
https://www.fsa.go.jp/news/r3/sonota/20220519.htmlopen new window
May 18, 2022 Publication of a tutorial video in regard to sustainability-related disclosure, aimed at further enhancement of corporate disclosure of narrative information
<Summary>
The FSA published a tutorial video in regard to sustainability-related disclosure, aimed at further enhancement of corporate disclosure of narrative information. The video is now available (in Japanese) on YouTubeopen new window.

The original press release is available in Japanese at the following URL.
https://www.fsa.go.jp/news/r3/singi/20220518.htmlopen new window
May 17, 2022 Publication of the main issues raised by the FSA at opinion exchange meetings with the relevant associations in the financial sector 
<Summary>
The FSA has published the main issues raised by the FSA at opinion exchange meetings* held with the relevant associations in the financial sector in April 2022. (Available only in Japanese).
Common topics across the groups were:

・Economic sanctions

・Publication of the Money Laundering Report

・Enhancements to cybersecurity measures under the recent geopolitical and socio-economic circumstances, and

・"Visualization" of financial institutions' initiatives and efforts based on the "Principles for Customer-Oriented Business Conduct." 


Other notable issues discussed by most but not all groups were:

・Replacement of LIBOR (London Interbank Offered Rate) in response to its cessation (with another global reference rate), and

・Ensuring of business conduct in response to the amendments to the "Guidelines for Personal Information Protection in the Financial Sector" (provisional English title) and other applicable guidelines, as well as relevant Q&As. 

* To enhance the transparency of its administration and to share its awareness of issues in the financial sector in a timely manner, the FSA publishes every month 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 April 2022, opinion exchange meetings were held respectively with four groups: major banks, etc.; the Regional Banks Association of Japan and the Second Association of Regional Banks; Trust Companies Association of Japan; and Japan Securities Dealers Association.



The original press release is available in Japanese at the following URL.
https://www.fsa.go.jp/common/ronten/index.htmlopen new window
May 17, 2022 Warnings about entities that are operating money lending businesses without proper registration
<Summary>
The FSA (Local Finance Bureaus) updated warnings about entities that are operating money lending businesses without proper registration. The warnings include the updated list of entities that misrepresent their registration using fictitious or stolen registration numbers.

The original press release is available in Japanese at the following URL.
https://www.fsa.go.jp/ordinary/chuui/index.htmlopen new window
May 13, 2022 Publication of the list of financial institutions satisfying the certain fill-in requirements of the designated reporting format pertaining to the status of their initiatives and efforts that have been taken so far and are to be taken based on the "Principles for Customer-Oriented Business Conduct" (as of the end of March 2022), and the publication of an analysis report on the common KPIs comparable across investment trust distributors reported by the respective financial institutions on the said list (as of the end of March 2021)
<Summary>
The FSA updated the list of financial institutions satisfying the certain fill-in requirements of the designated reporting format pertaining to the status of their initiatives and efforts that have been taken so far and are to be taken based on the "Principles for Customer-Oriented Business Conduct" as of the end of March 2022, in order to visualize financial institutions' initiatives and efforts.
The FSA aims at encouraging financial institutions to further visualize their customer-oriented business conduct by requesting them to meet the fill-in requirements of the format to report their initiatives and efforts based on the said Principles.
The FSA also published an updated trend analysis report on the common KPIs comparable across investment trust distributors reported by the respective financial institutions as of the end of March 2021. 

The original press release is available in Japanese at the following URL.
https://www.fsa.go.jp/news/r3/kokyakuhoni/202205/fd_2021.htmlopen new window

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