Local Strength, Global Reach –
Attractiveness of the Special Zones

Overview of Japan's Special Zones

It is essential to create an attractive business and living environment for financial and asset management services while also concentrating these industries in designated regions. At the same time, it is important to establish conditions that enable financial and asset management firms, which serve as capital providers, to effectively support and nurture local industries and businesses.

With this understanding, we are advancing regulatory reforms and operational initiatives not only in the financial sector but also in areas related to business and living environments, as well as industries targeted for investment. As part of this, we selected the four regions, Hokkaido/Sapporo, Tokyo, Osaka/Osaka City, and Fukuoka/Fukuoka City, as Special Zones for Financial and Asset Management Businesses, and they are actively working to enhance their business and living environments, provide fiscal and tax support, and promote growth industries.

Building Distinctive Ecosystems Across Japan’s Special Zones

In the four designated Special Zones, startups and emerging companies related to GX (Green Transformation) and sustainability are being established by leveraging the deregulation unique to these zones, in addition to the characteristics, strengths, and environments of each city. Asset management firms that provide investment capital to these regions are also beginning to enter the market. By providing startup companies with growth capital, they can generate additional value and growth, allowing them to return funds to asset management firms to create a healthy cycle. In this way, distinctive financial ecosystems are being formed in each region.
Accelerating Regulatory Reform and Its Strategic Use in Special Zones

To promote the entry of emerging asset management firms, regulatory easing has been implemented by relaxing registration requirements through outsourcing of middle- and back-office operations.
Additionally, regulatory reforms have been implemented that are based on the requests of each Special Zone to support their unique initiatives.
For example, in response to requests from Sapporo and Hokkaido, regulations on bank investments in GX-related businesses have been relaxed.
Similarly, in response to requests from Fukuoka and Fukuoka Prefecture, regulations have been eased to allow certain qualified individual investors to invest in professional venture funds, thereby expanding the supply of growth capital to startups.
Partnering with Private Asset Management Companies to Drive Investment Across Japan, Including Regional Areas

In response to the initiatives of the Special Zones and the regulatory reforms led by the national government, collaborations among private asset management companies are emerging.
For instance, the Asset Management Forum, which is primarily composed of domestic and international asset management firms, has been established. This forum engages in dialogue and discussions on reforming Japan’s asset management industry in cooperation with the national government and relevant local authorities.
Some of the key themes addressed by the forum are the promotion of investment in Japan, including regional areas, and the initiatives of the Special Zones.
In this way, investment in Japan, including its regional areas, is being encouraged, and momentum is building toward revitalizing local economies.