Defined Contribution Pension Act

When an employer with an EPI-applicable place of business intends to implement a corporate-type pension plan, the employer must prepare rules concerning the corporate-type pension plan and obtain approval of the Minister of Health, Labour and Welfare for those rules by obtaining consent of a labor union consisting of the majority of the category I or IV EPI insured person employed at the EPI-applicable place of business where the employer intends to implement a corporate-type pension plan (excluding those who fall under Article 9, paragraph (2), item (ii); hereinafter the same applies in this paragraph, paragraph (3) of the following Article (including as applied mutatis mutandis pursuant to Article 5, paragraph (4), Article 6, paragraph (2), and Article 46, paragraph (3)), and paragraph (4) of that Article, Article 5, paragraph (2) (including as applied mutatis mutandis pursuant to Article 6, paragraph (2)), and Article 46, paragraph (1)), if there is any such labor union, or consent of the person representative of the majority of the category I or IV EPI insured person, if there is no labor union consisting of the majority of the category I or IV EPI insured person.

When intending to implement a corporate-type pension plan at two or more EPI-applicable places of business, the consent referred to in the preceding paragraph must be obtained for each EPI-applicable place of business.

The rules concerning a corporate-type pension plan must provide for the following particulars:

the name and address of an employer with an EPI-applicable place of business that is to implement the corporate-type pension plan (hereinafter referred to as the "employer" except in the following paragraph, Article 47, item (v), Article 54-6, Article 55, paragraph (2), item (iv)-2, Article 70, Article 71, and Article 78);

the name and location of the EPI-applicable place of business where the corporate-type pension plan is to be implemented (hereinafter referred to as the "place of business implementing the plan") (in the case of the ship prescribed in Article 6, paragraph (1), item (iii) of the Employees' Pension Insurance Act (hereinafter referred to as a "ship"), the name and location of the shipowner prescribed in that item);

if the employer is to provide all or part of the operational management services, the services to be provided by the employer;

if the employer has entrusted all or part of the operational management services pursuant to the provisions of Article 7, paragraph (1), the name and address of the defined contribution pension plan operational management institution, and the services to be provided by the defined contribution pension plan operational management institution (meaning a person that engages in defined contribution pension plan operational management business by being registered under Article 88, paragraph (1); the same applies hereinafter) that has been thus entrusted (including a defined contribution pension plan operational management institution that has been re-entrusted pursuant to the provisions of Article 7, paragraph (2));

the name and address of the asset management institution;

in the case of specifying certain qualifications for the category I or IV EPI insured person employed at the place of business implementing the plan to become a participant of a corporate-type pension plan, matters concerning the qualifications;

the method for calculating the amount of the contribution to be made by the employer (hereinafter referred to as the "employer's contribution") and other particulars concerning making the contributions;

in the case of providing that a participant of a corporate-type pension plan may make contributions, the method for deciding or changing the amount of the contribution (hereinafter referred to as the "participant of a corporate-type pension plan's contribution") and other matters concerning the making contributions;

particulars concerning the presentation of the investment method and instructions on investment;

in the case of presenting a default investment method pursuant to the provisions of Article 23-2, paragraph (1), particulars concerning presentation of the default investment method;

in the case of excluding an investment method pursuant to the provisions of Article 26, paragraph (1), particulars concerning the procedure for the exclusion;

particulars concerning the amount of benefits of the corporate-type pension plan and the method of payment thereof;

in the case of providing that a participant of a corporate-type pension plan is to return all or part of the participant's assets managed per individual that are specified by Cabinet Order as the portion equivalent to the employer's contribution relating to the corporate-type pension plan to the employer relating to the employer's contribution if the participant had been employed at the place of business implementing the plan for less than three years as of the day of losing the status as a participant of a corporate-type pension plan, particulars concerning the method for calculating the amount of assets to be returned to the employer (hereinafter referred to as the "amount of assets to be returned");

particulars concerning the bearing of administrative expenses required for implementing the corporate-type pension plan; and

other particulars specified by Cabinet Order.

An employer with an EPI-applicable place of business that intends to obtain the approval referred to in paragraph (1) must submit a written application for the approval, attaching the following documents, to the Minister of Health, Labour and Welfare, pursuant to the provisions of Order of the Ministry of Health, Labour and Welfare:

the rules concerning the corporate-type pension plan to be implemented;

a document proving that the consent referred to in paragraph (1) has been obtained;

in the case of specifying certain qualifications for the category I or IV EPI insured person employed at the place of business implementing the plan to become a participant of a corporate-type pension plan, if a defined benefit corporate pension plan (meaning the defined benefit corporate pension plan prescribed in Article 2, paragraph (1) of the Defined Benefit Corporate Pension Act (Act No. 50 of 2001); the same applies hereinafter) or a retirement allowance system is implemented at the place of business implementing the plan, a document concerning the scope of persons covered by the defined benefit corporate pension plan and the retirement allowance system;

any other documents specified by Order of the Ministry of Health, Labour and Welfare.

Beyond what is provided for in the preceding paragraphs, Cabinet Order prescribes the necessary matters in connection with the approval for the rules concerning the corporate-type pension plan.

When an application for the approval referred to in paragraph (1) of the preceding Article is filed, and the Minister of Health, Labour and Welfare finds that the rules pertaining to the application satisfy the following requirements, the minister is to give the approval referred to in that paragraph:

the rules provide for the particulars set forth in the items of paragraph (3) of the preceding Article;

if certain qualifications to become a participant of a corporate-type pension plan have been specified for the category I or IV EPI insured person employed at the place of business implementing the plan, where a defined benefit corporate pension plan or a retirement allowance system is implemented, those qualifications are not unreasonably discriminatory against specific persons in light of the scope of persons covered by the defined benefit corporate pension plan and the retirement allowance system;

the rules provide that the employer's contribution is to be made in a fixed amount or in an amount calculated by the method of multiplying the amount of salary by a certain rate or calculated by a similar method;

the number and types of the investment methods to be presented do not run counter to the provisions of Article 23, paragraphs (1) and (2);

the rules allow a participant of a corporate-type pension plan or an instructor of a corporate-type pension plan (hereinafter referred to as a "participant or instructor of a corporate-type pension plan") to give instructions on investment at least once every three months;

the method for calculating the amount of benefits of the corporate-type pension plan conforms to the standards specified by Cabinet Order;

the rules provide that, if a participant of a corporate-type pension plan's assets managed per individual are to be transferred in a case that the participant had been employed at the place of business implementing the plan for not less than three years as of the day of losing the status as a participant of a corporate-type pension plan or that the participant has the right to receive disability benefits under the corporate-type pension plan, all of those assets are to be transferred; and

any other requirements specified by Cabinet Order.

When the Minister of Health, Labour and Welfare gives the approval referred to in paragraph (1) of the preceding Article, the minister must promptly give notice to that effect to the employer that has filed the application.

When the employer obtains the approval referred to in paragraph (1) of the preceding Article, the employer must, without delay, inform the category I or IV EPI insured person employed at the place of business implementing the plan of the rules for which the approval referred to in that paragraph has been obtained (hereinafter referred to as the "corporate-type pension plan rules").

The employer must keep the corporate-type pension plan rules at each place of business implementing the plan and have the category I or IV EPI insured person whom the employer employs inspect the rules at their request, pursuant to the provisions of Order of the Ministry of Health, Labour and Welfare.

When an employer intends to make a change to the corporate-type pension plan rules (excluding the minor change specified by Order of the Ministry of Health, Labour and Welfare), the employer must obtain approval of the Minister of Health, Labour and Welfare for that change.

An application for the approval for the change referred to in the preceding paragraph must be filed by obtaining consent of a labor union consisting of the majority of the category I or IV EPI insured person employed at the place of business implementing the plan, if there is any such labor union, or consent of the person representative of the majority of the category I or IV EPI insured person, if there is no labor union consisting of the majority of the category I or IV EPI insured person.

In the case referred to in the preceding paragraph, if there are two or more places of business implementing the plan, the consent referred to in that paragraph must be obtained for each place of business implementing the plan; provided, however, that if the change referred to in paragraph (1) does not involve all places of business implementing the plan, and the rules have provided for matters concerning that change in advance, once the consent referred to in the preceding paragraph has been obtained for the place of business implementing the plan subject to that change, it may be deemed that the consent of not only the places of business implementing the plan subject to that change but also the other places of business implementing the plan has also been obtained.

The provisions of the preceding Article apply mutatis mutandis to the case where an application for the approval or a change referred to in paragraph (1) has been filed. In this case, the phrase "category I or IV EPI insured person" in paragraph (3) of the preceding Article is deemed to be replaced with "category I or IV EPI insured person (including the instructor of a corporate-type pension plans, if an important change has been made to a matter concerning an instructor of a corporate-type pension plans)".

When an employer makes a change to the corporate-type pension plan rules (limited to the minor change specified by Order of the Ministry of Health, Labour and Welfare as referred to in paragraph (1) of the preceding Article), the employer must give notification of that change to the Minister of Health, Labour and Welfare without delay; provided, however, that this does not apply to a change to the matters set forth in Article 3, paragraph (3), item (v) or any other matter specified by Order of the Ministry of Health, Labour and Welfare.

The provisions of Article 4, paragraph (3) and paragraphs (2) and (3) of the preceding Article apply mutatis mutandis to the change referred to in the preceding paragraph; provided, however, that the provisions of paragraphs (2) and (3) of the preceding Article do not apply if the change is the minor change specified by Order of the Ministry of Health, Labour and Welfare as referred to in paragraph (1) of that Article, which is specified by Order of the Ministry of Health, Labour and Welfare as being particularly minor.

An employer may entrust all or part of operational management services to a defined contribution pension plan operational management institution, pursuant to the provisions of Cabinet Order.

Pursuant to the provisions of Cabinet Order a defined contribution pension plan operational management institution may re-entrust a part of the operational management services which it has been entrusted with under the provisions of the preceding paragraph to another defined contribution pension plan operational management institution.

If a defined contribution pension plan operational management institution that provides all or part of operational management services ceases to be available, the employer must provide all or part of the operational management services by itself, or decide on a defined contribution pension plan operational management institution that is to succeed those operational management services and entrust those operational management services to that institution.

If an employer has entrusted all or part of operational management services to a defined contribution pension plan operational management institution pursuant to the provisions of paragraph (1) (including the case where services have been re-entrusted pursuant to the provisions of paragraph (2)), the employer must, at least every five years, endeavor to conduct evaluation on the implementation of the operational management services, review the entrustment of the operational management services, and if found to be necessary, take necessary measures, such as changing the defined contribution pension plan operational management institution.

Beyond what is provided for in the preceding paragraphs, Cabinet Order prescribes the necessary matters in connection with entrustment of operational management services.