Financial Instruments and Exchange Act

If a financial instruments business operator, etc. comes to fall under any of the following items, the person specified in that item must notify the Prime Minister of this within 30 days from the day in question:

the financial instruments business operator is an individual, and that individual dies:the heir;

the financial instruments business operator, etc. discontinues financial instruments business, etc.:that corporation or individual;

the financial instruments business operator, etc. is a corporation, and that corporation disappears in a merger:the officer that represented the corporation;

the financial instruments business operator, etc. is a corporation, and that corporation is dissolved due to an order to commence bankruptcy proceedings:the bankruptcy trustee;

the financial instruments business operator, etc. is a corporation, and that corporation is dissolved for reasons other than a merger or an order to commence bankruptcy proceedings:the liquidator;

the financial instruments business operator, etc. is a corporation, and that corporation has the whole or part of its business succeeded to in a company split:that corporation;

the financial instruments business operator, etc. transfers the whole or part of its business:that corporation or individual; or

the financial instruments business operator (limited to those engaged in type-I financial instruments business) has obtained the registration referred to in Article 12 of the Act on the Provision of Financial Services and the Development of the Accessible Environment Thereto (limited to the registration related to the type of securities, etc. intermediary business operations; the same applies in paragraphs (11) and (12)) or the registration of change referred to in Article 16, paragraph (1) of that Act (limited to the registration related to the addition of the type of securities, etc. intermediary business operations; the same applies in paragraphs (11) and (12)): the financial instruments business operator that has obtained the registration or the registration of change.

If a financial instruments business operator, etc. comes to fall under any of items (i) through (vii) of the preceding paragraph (in item (vi) of the preceding paragraph, this is only if a financial instruments business operator, etc. has the whole of its business succeeded to in a company split, and in item (vii) of the preceding paragraph, this is only if a financial instruments business operator, etc. transfers the whole of its business), the Article 29 or Article 33-2 registration of the financial instruments business operator, etc. ceases to be effective.

If a financial instruments business operator is an individual (limited to one engaged in investment advisory business) and that individual dies, the heir may continue to engage in financial instruments business for 60 days after the death of the decedent (if, during that period, a disposition to refuse registration under Article 29-4, paragraph (1) is reached or the discontinuation of financial instruments business (limited to investment advisory business; hereinafter the same applies in this paragraph to paragraph (5)) is ordered pursuant to Article 52, paragraph (1) as applied pursuant to the provisions of the following paragraph following the deemed replacement of terms, the heir may continue to engage in financial instruments business until the day on which the disposition is reached or the discontinuation is ordered; hereinafter referred to as the "business continuation period" in this paragraph). The same applies until a disposition to make a registration or deny a registration in connection with an application is reached, if the heir files an application for the registration referred to in Article 29 (or, if the heir is a financial instruments business operator and files an application for the registration of a change referred to in Article 31, paragraph (4); hereinafter the same applies in this paragraph) during the business continuation period and the business continuation period elapses.

If it is permissible for an heir to continue engaging in financial instruments business pursuant to the provisions of the preceding paragraph, the heir is deemed to be a financial instruments business operator (limited to one engaged in investment advisory business), and the provisions of Articles 36 through 36-3; Article 37; Article 37-3; Article 37-4; Articles 37-6 through 38-2; Article 40; Articles 41 through 41-5; Article 43-6; Articles 44 through 44-3; Article 45; Articles 47 through 47-3; Article 49, paragraph (3); Article 49-4; Article 49-5; Article 51; Article 52, paragraph (1) (limited to the part that involves item (i) and items (viii) through (xi)); Article 52, paragraph (4) or (5); and Article 56-2 (limited to paragraph (1), (3) or (4)) (including the penal provisions linked with these provisions) apply. In this case, in Article 52, paragraph (1), the term "rescind its Article 29 registration" is deemed to be replaced with "order the discontinuation of financial instruments business".

With regard to the application of the provisions of Article 29-4, paragraph (1) if the discontinuation of financial instruments business is ordered pursuant to Article 52, paragraph (1) as applied pursuant to the provisions of the preceding paragraph following the deemed replacement of terms, the heir that is subject to the order for discontinuation is deemed to be a person that has had the registration referred to in Article 29 rescinded pursuant to the provisions of Article 52, paragraph (1), and the day on which the discontinuation is ordered is deemed to be the day on which the registration referred to in Article 29 is rescinded pursuant to the provisions of Article 52, paragraph (1).

If a financial instruments business operator, etc. seeks to discontinue financial instruments business, etc. (excluding investment advisory and agency business; the same applies in paragraph (8) and Article 56, paragraph (1)), to implement a merger (limited to a merger in which the financial instruments business operator, etc. disappears), to dissolve for reasons other than merger or an order to commence bankruptcy proceedings, to have all or part of its business succeeded to in a company split, or to transfer all or part of its business, it must issue public notice of this and post a notice in a place easily seen by the public at all of its business offices or offices pursuant to the provisions of Cabinet Office Order, by 30 days prior to the day on which it does so; provided, however, that in the cases specified by Cabinet Office Order as cases where there is no hindrance to the protection of investors, it is not required to post a notice.

If a financial instruments business operator, etc. issues a public notice under the preceding paragraph, it must notify the Prime Minister of this immediately.

If a financial instruments business operator, etc. issues a public notice under paragraph (6) (unless it issues that public notice in connection with the succession of the whole or part of its business upon merger or in a company split or in connection with the transfer of the whole or part of its business), the financial instruments business operator, etc. must promptly complete the purchase and sale and other transactions of securities and cryptoassets, and the derivatives transactions, etc. it is conducting (referred to as "customer transactions" in Article 56, Article 57-9 and Section 4-3), and return or transfer to customers without delay the assets that customers have deposited with it in connection with its financial instruments business, etc., the assets on its customers' accounts that are in its possession, and the cryptoassets of customers that it manages (referred to as "customer property" in Article 56, paragraph (1), Article 57-9 and that Section).

The provisions of Article 940, paragraph (1) (limited to the part that involves item (i)) and Article 940, paragraph (3) of the Companies Act apply mutatis mutandis if a financial instruments business operator, etc. (limited to one that is a company) issues a public notice under paragraph (6) through an electronic public notice (meaning an electronic public notice as provided for in Article 2, item (xxxiv) of that Act; the same applies hereinafter). In such a case, the necessary technical replacement of terms is specified by Cabinet Order.

The provisions of Article 940, paragraph (1) (limited to the part that involves item (i)) of the Companies Act and Article 940, paragraph (3); Article 941; Article 946; Article 947; Article 951, paragraph (2); Article 953; and Article 955 of that Act apply mutatis mutandis if a financial instruments business operator, etc. (limited to one that is a foreign company) issues a public notice under paragraph (6) through an electronic public notice. In such a case, the necessary technical replacement of terms is specified by Cabinet Order.

If any of the following items applies, the relevant financial instruments business operator's registration referred to in Article 29 ceases to be effective.

when a financial instruments business operator (limited to one engaged only in type-I financial instruments business) obtains the registration referred to in Article 66 (limited to that relating to the type of securities purchase and sale intermediary business, etc. prescribed in Article 66-2, paragraph (1), item (iv); the same applies in item (i) of the following paragraph) or the registration of change referred to in Article 66-5, paragraph (4) (limited to that relating to the addition of the type of securities purchase and sale intermediary business, etc. prescribed in Article 66-2, paragraph (1), item (iv); the same applies in item (i) of the following paragraph), or obtains the registration referred to in Article 12 of the Act on the Provision of Financial Services and the Development of the Accessible Environment Thereto or the registration of change referred to in Article 16, paragraph (1) of that Act;

when a financial instruments business operator (limited to one engaged only in cryptoasset trading business) obtains the registration referred to in Article 66 (limited to that relating to the type of intermediary services for purchase and sale, etc. of cryptoassets prescribed in Article 66-2, paragraph (1), item (iv); the same applies in (b) of the following item and in item (ii) and item (iii), (b) of the following paragraph) or the registration of change referred to in Article 66-5, paragraph (4) (limited to that relating to the addition of the type of intermediary services for purchase and sale, etc. of cryptoassets prescribed in Article 66-2, paragraph (1), item (iv); the same applies in item (ii) of the following paragraph);

if a financial instruments business operator (limited to one engaged only in type-I financial instruments business and cryptoasset trading business) falls under any of the following:

when it obtains the registration referred to in Article 66 (limited to that relating to the types of securities purchase and sale intermediary business, etc. and intermediary services for purchase and sale, etc. of cryptoassets prescribed in Article 66-2, paragraph (1), item (iv); the same applies in item (iii), (a) of the following paragraph);

when it obtains the registration referred to in Article 12 of the Act on the Provision of Financial Services and the Development of the Accessible Environment Thereto or the registration of change referred to in Article 16, paragraph (1) of that Act, and obtains the registration referred to in Article 66.

If any of the following items applies, except in the case prescribed in item (iii) of the preceding paragraph, the relevant financial instruments business operator is deemed to have obtained the registration of change referred to in Article 31, paragraph (4) with the content specified in the relevant item.

when a financial instruments business operator engaged in type-I financial instruments business (excluding one engaged only in type-I financial instruments business) obtains the registration referred to in Article 66 or the registration of change referred to in Article 66-5, paragraph (4), or obtains the registration referred to in Article 12 of the Act on the Provision of Financial Services and the Development of the Accessible Environment Thereto or the registration of change referred to in Article 16, paragraph (1) of that Act: to the effect that it will no longer conduct type-I financial instruments business;

when a financial instruments business operator engaged in cryptoasset trading business (excluding one engaged only in cryptoasset trading business) obtains the registration referred to in Article 66 or the registration of change referred to in Article 66-5, paragraph (4): to the effect that it will no longer conduct cryptoasset trading business;

if a financial instruments business operator engaged in type-I financial instruments business and cryptoasset trading business (excluding one engaged only in type-I financial instruments business and cryptoasset trading business) falls under any of the following: to the effect that it will no longer conduct type-I financial instruments business and cryptoasset trading business:

when it obtains the registration referred to in Article 66;

when it obtains the registration referred to in Article 12 of the Act on the Provision of Financial Services and the Development of the Accessible Environment Thereto or the registration of change referred to in Article 16, paragraph (1) of that Act, and obtains the registration referred to in Article 66.