FSA Weekly Review No.536 May 11, 2023

FSA Weekly Review No.536: May 11, 2023

What’s New on the FSA Website

Week of April 21, 2023 - May 2, 2023

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

Public Comments

April 28, 2023	Publication of the draft "Cabinet Order to Amend the Order for Enforcement of the Financial Instruments and Exchange Act" for public consultation <Summary> The FSA published the draft "Cabinet Order to Amend the Order for Enforcement of the Financial Instruments and Exchange Act" (hereinafter referred to as the "proposal") for public consultation. The proposal is aimed at enabling PTSs (Proprietary Trading Systems) to handle unlisted securities for professional investors, based on the recommendation by the "Working Group on Capital Market Regulations" (provisional English title) in regard to the facilitation of secondary trading of unlisted securities. Public comments will be accepted until 12:00 p.m. [noon] (JST), May 29, 2023. The original press release is available in Japanese at the following URL: https://www.fsa.go.jp/news/r4/shouken/20230428/20230428.html
April 28, 2023	Publication of the draft "Follow-up Guidance on Transition Finance – Towards Better Dialogue with Fundraisers" (provisional English title) [available only in Japanese] for public consultation <Summary> In the "Study Group on Environmental Improvement for Effective Transition Finance" (provisional English title), the FSA, METI (Ministry of Economy, Trade and Industry), and MoE (Ministry of the Environment) jointly compiled the draft "Follow-up Guidance on Transition Finance – Towards Better Dialogue with Fundraisers" (provisional English title) [available only in Japanese] for financial institutions and investors, and proposed it (hereinafter referred to as the "proposal") for public consultation. The proposal is aimed at improving the credibility and effectiveness of transition finance. Public comments will be accepted until 11:59 p.m. (JST), May 26, 2023. The original press release is available in Japanese at the following URL: https://www.fsa.go.jp/news/r4/singi/20230428.html
April 27, 2023	Publication of the finalized "Discussion Paper on Ensuring Operational Resilience" after public consultation <Summary> The FSA published the finalized "Discussion Paper on Ensuring Operational Resilience" after public consultation conducted in December 2022. In light of the importance of ensuring the ability of financial institutions to keep providing critical operations at a minimum level amidst the rapidly changing environment surrounding financial institutions, the discussion paper provides a framework to ensure the operational resilience of financial institutions, with practical points and issues, and with a view to using them as material for dialogues between the FSA and financial institutions toward the implementation of better practices. The finalized discussion paper took effect on April, 27, 2023. The original press release is available in Japanese at the following URL: https://www.fsa.go.jp/news/r4/ginkou/20230427.html
April 27, 2023	Publication of the draft amendments to the "Comprehensive Guidelines for Supervision of Major Banks, etc." for public consultation <Summary> The FSA proposed the draft amendments to the "Comprehensive Guidelines for Supervision of Major Banks, etc." (hereinafter referred to as the "proposal") for public consultation. The proposal is aimed at developing a supervisory framework to ensure financial institutions' operational resilience, based on the "Discussion Paper on Ensuring Operational Resilience" published in December 2022 and finalized in April 2023. Public comments will be accepted until 5:00 p.m. [JST], May 31, 2023. The original press release is available in Japanese at the following URL: https://www.fsa.go.jp/news/r4/ginkou/20230427-2.html
April 24, 2023	Publication of the draft revisions to the “Discussion Paper on Dialogues and Practices Regarding Financial Institutions’ IT Governance” for consultation <Summary> Since the publication of the first edition of the "Discussion Paper on Dialogues and Practices Regarding Financial Institutions’ IT Governance" on June 21, 2019, the FSA has maintained constructive dialogues with financial institutions and other experts. Taking into account that significant progress has been made in digital transformation (DX) of financial institutions that utilize IT and digital technologies, the FSA published the draft revisions to the Discussion Paper to update it as the second edition (available only in Japanese). The draft revisions cover latest developments in DX of financial services. Public comments will be accepted by 5:00 p.m. (JST), May 31, 2023. The original press release is available in Japanese at the following URL: https://www.fsa.go.jp/news/r4/sonota/20230424/20230424.html
April 21, 2023	Publication of the updated "Cabinet Office Order to Amend the Cabinet Office Order on Financial Instruments Business, etc." <Summary> The FSA published the updated "Cabinet Office Order to Amend the Cabinet Office Order on Financial Instruments Business, etc." The updated Cabinet Office Order mainly provides corresponding technical amendments in response to the enforcement of the "Act Partially Amending the Act on Regulation of Residential Land Development." No public consultation was conducted, for the amendments fall under cases prescribed in the "Administrative Procedures Act" as being insignificantly changed and not requiring the implementation of procedures for public consultation, such as the arrangement of the necessary provisions in accordance with the establishment, amendment or repeal of other laws and regulations. The updated Cabinet Office Order in tandem with the "Act Partially Amending the Act on Regulation of Residential Land Development" will be enforced on May 26, 2023. The original press release is available in Japanese at the following URL: https://www.fsa.go.jp/news/r4/shouken/20230421/20230421.html

Press Releases

International

April 27, 2023	Appointment for New Chair of the International Forum of Independent Audit Regulators (IFIAR)
April 26, 2023	Exchange of Letters for Cooperation with the Bangladesh Securities and Exchange Commission (BSEC)

Councils

April 26, 2023	Publication of the "Action Program for Accelerating Corporate Governance Reform: From Form to Substance"
April 24, 2023	Publication of the agenda and handouts of the seventh meeting of the "Working Group on Impact Investment" <Summary> The FSA published the agenda and handouts of the seventh meeting of the "Working Group on Impact Investment," which was held on April 24, 2023. Based on what some of the participants and the secretariat (the FSA) of the Working Group respectively briefed on impact investment/financing practices and on key discussion topics of the seventh meeting, the Working Group members discussed initiatives and efforts to support women entrepreneurs as well as the characteristics and challenges of impact investment/financing in regions. The original press release is available in Japanese at the following URL: https://www.fsa.go.jp/singi/impact/siryou/20230424.html
April 21, 2023	Publication of the agenda and handouts of the ninth meeting of the "Study Group on Digital- and Decentralized-Finance" (provisional English title) <Summary> The FSA published the agenda and handouts of the ninth meeting of the "Study Group on Digital- and Decentralized-Finance" (provisional English title), which was held on April 21, 2023. The secretariat (the FSA) gave a briefing on "foreign regulatory trends regarding crypto-assets, etc." and "enforcement cases regarding unfair and illegal trade practices involving digital assets, etc.," whereby the study group members discussed those topics. The original press release is available in Japanese at the following URL: https://www.fsa.go.jp/singi/digital/siryou/20230421.html

Banks

April 28, 2023	Overview of modifications to lending conditions by financial institutions <Summary> The FSA published an overview of modifications to lending conditions made by financial institutions for the period from March 10, 2020 to March 31, 2023. *The majority of the data reflects the data until March 3, 2023, whereas the data of cooperative financial institutions reflects the data until December 31, 2022. The original press release is available in Japanese at the following URL: https://www.fsa.go.jp/ordinary/coronavirus202001/kashitsuke/20200430.html
April 27, 2023	Updated FSA's web portal for information on “ZEDI (Zengin Electronic Data Interchange) system” in conjunction with the announcement on "DI-ZEDI" <Summary> The FSA updated its web portal for information on “ZEDI (Zengin Electronic Data Interchange) system,” in conjunction with the announcement regarding "DI-ZEDI," a financial EDI (Electronic Data Interchange) standard established on April 24, 2023 by Japanese Banks' Payment Clearing Network, which corresponds to the domestic EDI standard specifications for digital invoices. The original press release is available in Japanese at the following URL: https://www.fsa.go.jp/policy/zedi/zenginedi.html
April 24, 2023	Warning against the surge in online banking fraud <Summary> The FSA issued a warning against online banking fraud that surged in February 2023, arising from SMS (short message services)/email phishing attacks aimed at stealing IDs and passwords of online banking users and fraudulently transferring their deposits. To widely raise awareness of financial services users, the FSA, in collaboration with the National Police Agency, has shared on its website and twitter account about the scamming methods used by offenders in money-transfer scams targeting online financial services users, urging financial services users to take precautions, such as not opening unknown SMS messages and so forth. The FSA also urges financial services users to report to (and/or consult with) the authorities (such as the police or the FSA's Counseling Office for Financial Services Users), or the contact point of the Japanese Bank Association whenever any sign of fraudulence is detected. The original press release is available in Japanese at the following URL: https://www.fsa.go.jp/ordinary/internet-bank_2.html

Others

May 1, 2023	Nationwide campaign of "Problem Gambling Awareness Week" <Summary> In regard to the nationwide campaign of "Problem Gambling Awareness Week," which is held from May 14 to 20 every year, the FSA has updated its one-stop webpage displaying information on the campaign. The Awareness Week is an annual key initiative in which the FSA and the relevant parties across the nation take various approaches and efforts to further raise public awareness of the adverse impact* of problem gambling and provide relevant information, including the consultative services** for those in need of help for prevention of and recovery from such gambling harm. * For example, problem gamblers can precipitate financial and other difficulties for themselves and the people around them. ** Advisory services are available at each region’s permanent point of contact for consultations on multi-debt. The original press release is available in Japanese at the following URL: https://www.fsa.go.jp/policy/kashikin/gambling/20230514.html
April 28, 2023	Deliverables pertaining to "Survey and Analysis of Discussions Held and Discussion Materials Presented at the International Accounting Standards Board" (for FY2022) <Summary> The FSA entrusted the Financial Accounting Standards Foundation (FASF) to conduct administrative affairs pertaining to the research and analysis of discussions held at the International Accounting Standards Board (IASB) as well as of the relevant materials presented therein, in order to swiftly and accurately grasp trends in the discussions on the formulation and revision of International Financial Reporting Standards (IFRS) at the IASB and to effectively publicize Japan's stance/perspectives on IFRS. The deliverables from the FASF are available only in Japanese. The original press release is available in Japanese at the following URL: https://www.fsa.go.jp/common/about/research/20230428-2.html
April 28, 2023	Deliverables pertaining to "Participation in International Accounting Standards Board (IASB) International Conferences and Dissemination of Opinions, etc." (for FY2022) <Summary> The FSA entrusted the Financial Accounting Standards Foundation (FASF) to participate in international accounting conferences to swiftly and accurately grasp the trends of discussions on the formulation and revision of International Financial Reporting Standards (IFRS) at the International Accounting Standards Board (IASB), and to conduct administrative affairs in terms of gathering opinions from relevant parties in Japan who are well-versed in IFRS, thereby publicizing Japan's stance/perspectives on the subject. The deliverables from the FASF are available only in Japanese. The original press release is available in Japanese at the following URL: https://www.fsa.go.jp/common/about/research/20230428-3.html
April 28, 2023	Deliverables pertaining to "Survey and Analysis of Discussions Held and Discussion Materials Presented at the International Sustainability Standards Board" (for FY2022) <Summary> The FSA entrusted the Financial Accounting Standards Foundation (FASF) to conduct administrative affairs pertaining to the research and analysis of discussions held at the International Sustainability Standards Board (ISSB) as well as of the relevant materials presented therein, in order to swiftly and accurately grasp trends in the discussions on the formulation and revision of IFRS Sustainability Disclosure Standards at the ISSB and to effectively publicize Japan's stance/perspectives on IFRS. The deliverables from the FASF are available only in Japanese. The original press release is available in Japanese at the following URL: https://www.fsa.go.jp/common/about/research/20230428-1.html
April 27, 2023	Contribution of “The crypto-asset world is sobering up” to the Eurofi Magazine
April 27, 2023	A speech on “Four Lessons Learned from Recent Events: Do not miss the real issues” at the Eurofi High Level Seminar 2023
April 27, 2023	Publication of a research report on the analysis of international regulatory trends and regulatory enforcements as well as of challenges in the market related to unfair/inappropriate transactions and activities involving digital assets, including crypto-assets <Summary> The FSA commissioned EY Strategy and Consulting Co., Ltd. to conduct research to ascertain and analyze international regulatory trends and regulatory enforcements(including analysis of their enforcement methods from legal, regulatory and technical perspectives) as well as of challenges in the market (including specific problematic cases) related to unfair/inappropriate transactions and activities involving digital assets, including crypto-assets, aimed at utilizing the findings in future policy making for the FSA. The compiled research report is available (only in Japanese) on the FSA's website. The original press release is available in Japanese at the following URL: https://www.fsa.go.jp/common/about/research/20230427/20230427.html
April 26, 2023	New web portal for information regarding disclosure of narrative information on corporate sustainability in securities reports, etc. <Summary> The FSA launched a new web portal for information regarding disclosure of narrative information on corporate sustainability in securities reports, etc. The original press release is available in Japanese at the following URL: https://www.fsa.go.jp/policy/kaiji/sustainability-kaiji.html
April 24, 2023	Warning with respect to the recent developments that call for implementation of cybersecurity measures at financial institutions, particularly for the period in and around the national holiday-studded golden week in 2023 <Summary> On April 24, 2023, the FSA urged financial institutions to implement cyber security measures for the period in and around the national holiday-studded golden week in 2023,* in light of the recent surge in potential threats of cyber-attacks. In addition, the FSA reminded financial institutions to promptly report to the FSA or the Local Finance Bureaus in the event of a cyber-attack. *The national holiday-studded golden week in 2023 refers to the period from April 29 to May 7, 2023. The original press release is available in Japanese at the following URL: https://www.fsa.go.jp/news/r4/cyber/0424oshirase.html
April 21, 2023	Publication of "Progress Report on Enhancing Asset Management Business 2023" and other relevant survey reports <Summary> The FSA published "Progress Report on Enhancing Asset Management Business 2023." The report (full report and its summary) [available only in Japanese] outlines what the FSA believes is necessary for the asset management sector in Japan to enhance professionalism and transparency of its management and services, earn public trust, and grow as an important sector for the Japanese market, taking into account international trends, based on comments and insights collected through interviews with a number of experts across the asset management sector. In conjunction with the said progress report, the FSA also published the following survey reports which were respectively commissioned to QUICK Corp. and Ibbotson Associates Japan, Inc.: (1) A survey on the investment performance of asset managers in Japan (as of the end of 2022) [available only in Japanese], and (2) A survey on the investment performance of asset managers in the U.S and Europe (as of the end of 2022) [available only in Japanese]. The original press release is available in Japanese at the following URL: https://www.fsa.go.jp/news/r4/sonota/20230421.html
April 21, 2023	Updated list of entities that are operating financial instruments businesses without proper registration (The Kanto Local Finance Bureau) <Summary> The FSA and the Kanto Local Finance Bureau issued warnings to entities that are operating financial instruments businesses without proper registration. (See the updated lists of Japan-based entities* and foreign-based entities). These lists also include the warned non-registered entities with untraceable/unidentified addresses. (Postal and/or web addresses on the list of the warned non-registered foreign-based entities reflect those shown on their respective webpages, not necessarily the addresses that could be traced and identified). The original press release is available in Japanese at the following URL: https://www.fsa.go.jp/ordinary/chuui/mutouroku.html

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