Financial Instruments and Exchange Act

If a person makes a series of purchase and sales of securities, etc. that is in violation of the provisions of Article 159, paragraph (3) (meaning purchase and sales of securities, etc. prescribed in paragraph (2) of that Article), or offers to make such a series of purchase and sales or entrusts, etc. a person with effecting such a series of purchase and sales (hereinafter the act is referred to as a "violation" and the person is referred to as the "violator" in this Article), the Prime Minister must, in accordance with the procedures prescribed in the following Section, order the violator to pay an administrative monetary penalty to the national treasury in an amount that is equivalent to the sum of the amounts specified in each of the following items (referred to as the "total amount" in paragraphs (11) and (12)):

the amount arrived at when the amount specified in (b) below is deducted from the amount specified in (a) below:

the value of the sales, etc. of securities on the violator's own account that the violation involves;

the value of the purchases, etc. of securities on the violator's own account that the violation involves;

the amount specified in the following sub-items (a) through (d) in accordance with the category of cases set forth in the sub-items (a) through (d) (or, if the violation falls under two or more cases set forth in the following sub-items (a) through (d), the sum of the amounts specified in those two or more provisions of (a) through (d)):

at the time of the commencement of the violation, the violator's sales volume, etc. in respect of the listed financial instruments, etc. (meaning listed financial instruments, etc. prescribed in Article 159, paragraph (2), item (i); hereinafter the same applies in this Article) or over-the-counter traded securities involved in the violation exceeds the violator's purchase volume, etc. of the over-the-counter traded securities: the amount arrived at when the amount specified in 2. below is deducted from the amount specified in 1. below, and the difference is multiplied by the volume specified in 3. below (if the resulting amount is less than zero, the amount is deemed to be zero):

the price after the violation for the purchase, etc. of securities pertaining to the relevant listed financial instruments, etc. or over-the-counter traded securities (meaning the amount calculated pursuant to the provisions of Cabinet Office Order as the average price during the period until one month has elapsed since the violation ended; hereinafter the same applies in this paragraph);

the price during the violation for the purchase, etc. of securities pertaining to the relevant listed financial instruments, etc. or over-the-counter traded securities (meaning the amount calculated pursuant to the provisions of Cabinet Office Order as the average price during the period from the commencement of the violation to the end of the violation; hereinafter the same applies in this paragraph);

the volume that is in excess;

at the time of the commencement of the violation, the violator's purchase volume, etc. in respect of the listed financial instruments, etc. or over-the-counter traded securities involved in the violation exceeds the violator's sales volume, etc. of the over-the-counter traded securities: the amount arrived at when the amount specified in 2. below is deducted from the amount specified in 1. below, and the difference is multiplied by the volume specified in 3. below (if the resulting amount is less than zero, the amount is deemed to be zero):

the price during the violation for the sale, etc. of securities pertaining to the relevant listed financial instruments, etc. or over-the-counter traded securities;

the price after the violation for the sale, etc. of securities pertaining to the relevant listed financial instruments, etc. or over-the-counter traded securities;

the volume that is in excess;

during the period from the commencement of the violation until one month has elapsed since the violation ended, the violator causes the securities involved in the violation that they or a person with a specified relationship issues, to be acquired through a solicitation with a view to issuing new securities, or delivers those securities in a corporate reorganization: the amount arrived at when the amount set forth in 2. is deducted from the amount set forth in 1., and the difference is multiplied by the volume set forth in 3. (if the resulting amount is less than zero, the amount is to be zero):

the price during the violation for the securities that the violator causes to be acquired through the solicitation with a view to issuing new securities or delivers in the corporate reorganization;

the price after the violation for the securities that the violator causes to be acquired through the solicitation with a view to issuing new securities or delivers in the corporate reorganization;

the volume of securities that the violator causes to be acquired through the solicitation with a view to issuing new securities or delivers in the corporate reorganization;

during the period from the commencement of the violation until one month has elapsed since the violation ended, the violator commits a violation or makes a sale, etc. of securities or a purchase, etc. of securities on the account of any person other than themselves (excluding a person with a specified relationship): the amount specified in 1. or 2. below in accordance with the category of the person that has conducted the violation, the sale, etc. of securities or the purchase, etc. of securities set forth in 1. or 2.:

a person that has committed the violation or has made the sale, etc. of securities or the purchase, etc. of securities as an investment of property subject to investment:the amount obtained by multiplying by three, the amount specified by Cabinet Office Order as an amount equivalent to the consideration for investment of the property subject to investment which is specified by Cabinet Office Order in the month that includes the day of the violation, the sale, etc. of securities or the purchase, etc. of securities (if the violation, the sale, etc. of securities or the purchase, etc. of securities has been conducted over two or more months, the last month of those months); or

a person other than the person set forth in 1.:the amount specified by Cabinet Office Order as the amount of the fee, remuneration, or other consideration pertaining to the violation, the sale, etc. of securities or the purchase, etc. of securities.

The term "sale, etc. of securities" as used in this Article means the sale of securities or commodities (in the case of commodities, limited to sales made through market derivatives transactions (limited to transactions set forth in Article 2, paragraph (21), item (i))), a transaction set forth in item (ii) of that paragraph (limited to a transaction in which the violator is the party to pay the money if the actual figure exceeds the agreed figure), a transaction set forth in Article 2, paragraph (21), item (iii) (limited to a transaction in which the relevant person is the party to grant the option), or any other transaction specified by Cabinet Order.

The term "purchase, etc. of securities" as used this Article means a purchase of securities or commodities (in the case of commodities, limited to purchase made through market derivatives transactions (limited to transactions set forth in Article 2, paragraph (21), item (i))), a transaction set forth in item (ii) of that paragraph (limited to a transaction in which the violator is the party to receive the money if the actual figure exceeds the agreed figure), a transaction set forth in Article 2, paragraph (21), item (iii) (limited to a transaction in which the relevant person is the party to acquire the option), or any other transaction specified by Cabinet Order.

The term "value" as used in paragraph (1), item (i) means the amount arrived at when the price for sale, etc. of securities is multiplied by the volume of that sale, etc. or when the price for purchase, etc. of securities is multiplied by the volume of that purchase, etc.

The term "volume of sales, etc." as used in this Article means the volume of the securities or commodities related to the transactions which the violator, on their own account or on the account of the persons in specified relationship, has made the sales, etc. of securities or commodities without possessing the securities or commodities (in the case of commodities, limited to sales made through market derivatives transactions (limited to transactions set forth in Article 2, paragraph (21), item (i))) or any other transactions specified by Cabinet Order; or the volume of the transaction set forth in item (ii) of that paragraph (limited to the transaction in which the person becomes a party paying money when the actual figure exceeds the agreed figure) which the violator has conducted on their own account or on the account of the persons in specified relationship or any other transactions specified by Cabinet Order, as calculated pursuant to the provisions of Cabinet Order.

The term "purchase volume, etc." as used in this Article means the volume of the securities or commodities that the violator or a person with a specified relationship possesses or any other securities or commodities specified by Cabinet Order as being equivalent to them, and the volume calculated pursuant to the provisions of Cabinet Order as the volume of a transaction set forth in Article 2, paragraph (21), item (ii) (limited to a transaction in which the violator is the party to receive money if the actual figure exceeds the agreed figure) or any other transaction specified by Cabinet Order, which the violator agrees to conduct on their own account or on the account of a person with a specified relationship.

The term "person with a specified relationship" as used in this Article means any of the following persons:

a company in which the violator holds the majority of the voting rights held by all of the shareholders, etc. or any other person specified by Cabinet Office Order as being closely related to the violator;

a person that shares living expenses with the violator, or any other person specified by Cabinet Office Order as having a unique relationship with the violator.

If a person with a specified relationship has committed the same violation as that committed by the violator, the following volume is excluded from the volume of sales, etc.: the volume of the securities or commodities related to the transactions in which, at the time of the commencement of the violation and with regard to the listed financial instruments, etc. or the over-the-counter traded securities subject to the violation, the person with a specified relationship has conducted sales of the securities or commodities or any transaction specified by Cabinet Order on their own account without possessing the securities or commodities (in the case of commodities, limited to sale made through market derivatives transactions (limited to transactions set forth in Article 2, paragraph (21), item (i))); or the volume of the transactions calculated pursuant to the provisions of Cabinet Order, in which, at the time of the commencement of the violation and with regard to the listed financial instruments, etc. or the over-the-counter traded securities subject to the violation, the person with a specified relationship has, on their own account, conducted the transaction set forth in Article 2, paragraph (21), item (ii) (limited to the transaction in which the person becomes a party to pay money when the actual figure exceeds the agreed figure) or any other transactions specified by Cabinet Order.

If a person with a specified relationship commits the same violation as the violator, the volume of the securities or commodities that the person with the specified relationship possesses, and any other securities or commodities specified by Cabinet Order as being equivalent to them at the time of the commencement of the violation, in respect of the listed financial instruments or over-the-counter traded securities involved in the violation and the volume calculated pursuant to the provisions of Cabinet Order as the volume of a transaction set forth in Article 2, paragraph (21), item (ii) (limited to a transaction in which the person with the specified relationship is the party to receive money if the actual figure exceeds the agreed figure) or any other transaction specified by Cabinet Order in respect of the listed financial instruments, etc. or over-the-counter traded securities involved in the violation in which the person with the specified relationship has agreed to conduct on their own account, is to be deducted from the purchase volume, etc.

The amount set forth in the items of paragraph (1) are calculated for each issue of securities.

If a negative amount arises from the deduction set forth in paragraph (1), item (i) for a single issue, the total amount is the amount arrived at when the negative amount is deducted from the amount specified in item (ii) of that paragraph for the same issue.

If there are two or more issues connected with a violation and the amount for any of those issues is still negative even after a deduction is made pursuant to the provisions of the preceding paragraph, the negative amount is deducted from the total amount for other issues.

If a transaction set forth in Article 2, paragraph (21), item (ii) is settled through the payment and receipt of money based on the actual figure, if the options on a transaction set forth in item (iii) of that paragraph extinguish without being exercised; and in any other case specified by Cabinet Order as being similar, the necessary particulars relevant to the calculation of the administrative monetary penalty referred to in paragraph (1) are specified by Cabinet Order.

Beyond what is provided for in paragraph (2) through the preceding paragraph, the necessary particulars relevant to the calculation of the value of the sale, etc. of securities and the value of the purchase, etc. of securities provided for in paragraph (1), item (i), and necessary particulars otherwise relevant to the calculation of the administrative monetary penalty referred to in that paragraph are specified by Cabinet Order.