Foreign Exchange and Foreign Trade Act

A foreign investor that has filed a notification under Article 28, paragraph (1) must, when it intends to make a change, after the expiration of the prohibition period prescribed in paragraph (8) of the following Article, relating to the matters set out in Article 28, paragraph (1), item (iv) that pertain to the notification (if a notification of modification or change has been made in accordance with a recommendation under Article 28, paragraph (5) (including as applied mutatis mutandis pursuant to the following paragraph), or based on an order under Article 27, paragraph (10) as applied mutatis mutandis pursuant to Article 28, paragraph (7) (including as applied mutatis mutandis pursuant to the following paragraph), or pursuant to the provisions of paragraph (1) of the preceding Article (including as applied mutatis mutandis pursuant to the following paragraph), or pursuant to the provisions of this paragraph, the matters as so modified or changed), notify the Minister of Finance and the competent minister for the business of the change in advance, pursuant to the provisions of Cabinet Order.

The provisions of Article 28, paragraphs (2) through (9) and the preceding Article apply mutatis mutandis to a notification of a change under the preceding paragraph. In this case, the phrase "undertake the specified acquisition" in Article 28, paragraph (2) is deemed to be replaced with "make the change to the matters stated in item (iv) of the preceding paragraph"; the phrase "would compromise national security" in Article 28, paragraph (3) is deemed to be replaced with "would, by a change to the matters stated in paragraph (1), item (iv) that relate to the notification under Article 28-4, paragraph (1), compromise national security"; in Article 28, paragraph (5), the phrase "the person that filed the notification of the specified acquisition to change the substance of the acquisition" is deemed to be replaced with "the person that filed the notification of the specified acquisition", the phrase "relating to the matters set out in paragraph (1), item (iv) that pertain to the notification" is deemed to be replaced with "of the change relating to the matters set out in paragraph (1), item (iv) that pertain to the notification under Article 28-4, paragraph (1)", and the phrase "discontinue the specified acquisition" is deemed to be replaced with "discontinue the change to the matters stated in that item that relate to the notification under Article 28-4, paragraph (1)"; the phrase "provided, however, that the period during which the ministers may recommend the change" in the proviso to Article 28, paragraph (5) is deemed to be replaced with "provided, however, that the period during which the ministers may recommend"; the phrase "Article 27, paragraphs (7) through (12)" in Article 28, paragraph (7) is deemed to be replaced with "Article 27, paragraphs (7) through (12) as applied mutatis mutandis pursuant to paragraph (2) of the preceding Article"; and the phrase "relating to the matters set out in Article 28, paragraph (1), item (iv) that pertain to the notification" in paragraph (1) of the preceding Article is deemed to be replaced with "of the change relating to the matters set out in Article 28, paragraph (1), item (iv) that pertain to the notification of a change under paragraph (1) of the following Article", and the phrase "of the modification" in paragraph (1) of the preceding Article is deemed to be replaced with "of the modification of that change"; in addition, Cabinet Order prescribes any necessary technical replacement of terms.

In any of the following cases, if the Minister of Finance and the competent minister for the business find that inward direct investment or equivalent action or a specified acquisition falls under inward direct investment or equivalent action that is a matter of national security or a similar concern or a specified acquisition that is a matter of national security, they may, after hearing the opinion of the Council on Customs, Tariffs, Foreign Exchange, and Other Transactions, order the foreign investor that has conducted the inward direct investment or equivalent action or specified acquisition, pursuant to the provisions of Cabinet Order, to dispose of all or part of the shares or equity interests acquired through that inward direct investment or equivalent action or specified acquisition, or to take any other necessary measures.

if a foreign investor that is required to file a notification under Article 27, paragraph (1) or Article 28, paragraph (1) conducts an inward direct investment or equivalent action or a specified acquisition without filing that notification; or

if a foreign investor that has filed a notification under Article 27, paragraph (1) or Article 28, paragraph (1) conducts the inward direct investment or equivalent action or the specified acquisition stated in the notification before the expiration of the prohibition period.

if a foreign investor that has filed a notification under Article 27, paragraph (1) or Article 28, paragraph (1) fails to take a measure relating to national security or a similar concern with regard to the matters that are subject to the notification under Article 27, paragraph (1) and are stated in item (iv) of that paragraph (or, where a notification of a modification or change to those matters has been filed in compliance with a recommendation under Article 27, paragraph (5) (including as applied mutatis mutandis pursuant to Article 27-4, paragraph (2)), based on an order under Article 27, paragraph (10) (including as applied mutatis mutandis pursuant to Article 27-4, paragraph (2)), pursuant to Article 27-3, paragraph (1) (including as applied mutatis mutandis pursuant to Article 27-4, paragraph (2)), or pursuant to Article 27-4, paragraph (1), those matters as so modified or changed), or fails to take a measure relating to national security with regard to the matters that are subject to the notification under Article 28, paragraph (1) and are stated in item (iv) of that paragraph (or, where a notification of a modification or change to those matters has been filed in compliance with a recommendation under Article 28, paragraph (5) (including as applied mutatis mutandis pursuant to paragraph (2) of the preceding Article), based on an order under Article 27, paragraph (10) as applied mutatis mutandis pursuant to Article 28, paragraph (7) (including as applied mutatis mutandis pursuant to paragraph (2) of the preceding Article), pursuant to Article 28-3, paragraph (1) (including as applied mutatis mutandis pursuant to paragraph (2) of the preceding Article), or pursuant to paragraph (1) of the preceding Article, those matters as so modified or changed).

If a foreign investor that has filed a notification under Article 27, paragraph (1) or Article 28, paragraph (1) has used false information in it and the Minister of Finance and the competent minister for the business find that the inward direct investment or equivalent action or specified acquisition that is subject to that notification constitutes inward direct investment or an equivalent action that is a matter of national security or a similar concern or constitutes a specified acquisition that is a matter of national security, they may order the foreign investor that has conducted the inward direct investment or equivalent action or the specified acquisition to take the necessary measures, pursuant to Cabinet Order and after hearing the opinions of the Council on Customs, Tariffs, Foreign Exchange, and Other Transactions.

If a foreign investor that has filed a notification under Article 27, paragraph (1) or Article 28, paragraph (1) fails to follow a recommendation to modify the substance of the inward direct investment or equivalent action or the specified acquisition that is subject to that notification after having filed a notification with the Minister of Finance and the competent minister for the business of compliance with that recommendation pursuant to Article 27, paragraph (7) (including as applied mutatis mutandis pursuant to Article 28, paragraph (7)), or if such a foreign investor violates an order under Article 27, paragraph (10) (including as applied mutatis mutandis pursuant to Article 28, paragraph (7)) to modify the substance of the inward direct investment or equivalent action or the substance of the specified acquisition, the Minister of Finance and the competent minister for the business may order the foreign investor that has carried out the inward direct investment or equivalent action or the specified acquisition to dispose of all or part of the shares or equity acquired through the inward direct investment or equivalent action or through the specified acquisition (if the ministers have recommended modifying the number or amount of shares or the number or amount of units of equity involved in the inward direct investment or equivalent action or in the specified acquisition pursuant to Article 27, paragraph (5) or Article 28, paragraph (5), or if they have ordered a modification to the number or amount of shares or the number or amount of units of equity involved in the inward direct investment or equivalent action or in the specified acquisition pursuant to Article 27, paragraph (10) (including as applied mutatis mutandis pursuant to Article 28, paragraph (7)), they may only order the investor to dispose of the part subject to the modification), or to take other necessary measures, pursuant to Cabinet Order.

If a foreign investor that has filed a notification under Article 27, paragraph (1) or Article 28, paragraph (1) fails to follow a recommendation to discontinue the inward direct investment or equivalent action or the specified acquisition that is the subject of that notification after having filed a notification with the Minister of Finance and the competent minister for the business of compliance with that recommendation pursuant to Article 27, paragraph (7) (including as applied mutatis mutandis pursuant to Article 28, paragraph (7)), or if such a foreign investor violates an order under Article 27, paragraph (10) (including as applied mutatis mutandis pursuant to Article 28, paragraph (7)) to discontinue the inward direct investment or equivalent action or the specified acquisition, the Minister of Finance and the competent minister for the business may order the foreign investor that has undertaken the inward direct investment or equivalent action or the specified acquisition to dispose of all or part of the shares or equity acquired through the inward direct investment or equivalent action or through the specified acquisition, or to take other necessary measures, pursuant to Cabinet Order.

If a foreign investor that has filed a notification under Article 27, paragraph (1), Article 27-4, paragraph (1), Article 28, paragraph (1) or paragraph (1) of the preceding Article fails to follow a recommendation for a modification of a measure relating to national security or a similar concern or a modification of a measure relating to national security, of which the foreign investor has given notice of acceptance pursuant to Article 27, paragraph (7) (including as applied mutatis mutandis pursuant to Article 27-4, paragraph (2) or Article 28, paragraph (7) (including as applied mutatis mutandis pursuant to paragraph (2) of the preceding Article)), or violates an order for a modification of a measure relating to national security or a similar concern or a modification of a measure relating to national security under Article 27, paragraph (10) (including as applied mutatis mutandis pursuant to Article 27-4, paragraph (2) or Article 28, paragraph (7) (including as applied mutatis mutandis pursuant to paragraph (2) of the preceding Article)), the Minister of Finance and the competent minister for the business may order the foreign investor, pursuant to Cabinet Order, to dispose of all or part of the shares or equity acquired through the inward direct investment or equivalent action or the specified acquisition that is subject to the notification, or to take other necessary measures.

If a foreign investor that has filed a notification under Article 27-4, paragraph (1) or paragraph (1) of the preceding Article fails to follow a recommendation to discontinue the change relating to those notifications, of which the foreign investor has given notice of acceptance pursuant to Article 27, paragraph (7) as applied mutatis mutandis pursuant to Article 27-4, paragraph (2) (including as applied mutatis mutandis pursuant to Article 28, paragraph (7) as applied mutatis mutandis pursuant to paragraph (2) of the preceding Article), or violates an order to discontinue the change relating to those notifications under Article 27, paragraph (10) as applied mutatis mutandis pursuant to Article 27-4, paragraph (2) (including as applied mutatis mutandis pursuant to Article 28, paragraph (7) as applied mutatis mutandis pursuant to paragraph (2) of the preceding Article), the Minister of Finance and the competent minister for the business may order the foreign investor, pursuant to Cabinet Order, to dispose of all or part of the shares or equity acquired through the inward direct investment or equivalent action or the specified acquisition that is subject to the notification, or to take other necessary measures.

If, pursuant to the provisions of Article 27-2, paragraph (1) or Article 28-2, paragraph (1), a foreign investor as provided in Article 27-2, paragraph (1) or Article 28-2, paragraph (1) has carried out an inward direct investment or equivalent action or a specified acquisition without filing a notification under Article 27, paragraph (1) or Article 28, paragraph (1), and has violated an order under Article 27-2, paragraph (4) or Article 28-2, paragraph (4), and if the Minister of Finance and the competent minister for the business find that the inward direct investment or equivalent action constitutes an inward direct investment or equivalent action that is a matter of national security or a similar concern or that the specified acquisition constitutes a specified acquisition that is a matter of national security, the ministers, pursuant to the provisions of Cabinet Order and after hearing the opinions of the Council on Customs, Tariffs, Foreign Exchange, and Other Transactions, may order the foreign investor that has carried out the inward direct investment or equivalent action or the specified acquisition to dispose of all or part of the shares or equity acquired through the inward direct investment or equivalent action or through the specified acquisition, or to take any other necessary measures.

The term "prohibition period" referred to in paragraph (1), item (ii) means the prohibition period prescribed in Article 27, paragraph (3) (or, if the period is extended pursuant to the provisions of that paragraph or paragraph (6) of that Article or Article 27-3, paragraph (2), or shortened pursuant to the provisions of the proviso to Article 27, paragraph (2) or paragraph (4) of that Article, the period so extended or shortened), or the prohibition period prescribed in Article 28, paragraph (3) (or, if the period is extended pursuant to the provisions of that paragraph or paragraph (6) of that Article or Article 28-3, paragraph (2), or shortened pursuant to the provisions of the proviso to Article 28, paragraph (2) or paragraph (4) of that Article, the period so extended or shortened).

In the cases prescribed in paragraph (1) and paragraphs (3) through (6), if, due to the ownership or holding, by a directly held corporation or other organization prescribed in Article 26, paragraph (5), of shares or equity in a company (excluding a listed or equivalent company; the same applies hereinafter in this paragraph) or of shares owned or otherwise managed under contract or voting rights held or otherwise exercisable under contract of a listed or equivalent company, in connection with an inward direct investment or equivalent action (limited to an act stated in Article 26, paragraph (2), item (ix) or (x), or an act stated in item (xi) of that paragraph (limited to an act prescribed by Cabinet Order as being equivalent to the acts stated in items (ix) and (x) of that paragraph)), there is actually a risk of giving rise to either of the situations stated in Article 27, paragraph (3), item (i), (a) or (b), and it is extremely difficult to eliminate that risk by an order to the foreign investor that undertook the inward direct investment or equivalent action, the Minister of Finance and the competent minister for the business may order the directly held corporation or other organization, pursuant to Cabinet Order, to dispose of all or part of the shares or equity in a company or the shares owned or otherwise managed under contract or voting rights held or otherwise exercisable under contract of a listed or equivalent company that it owns or holds, or to take other necessary measures. In this case, if the directly held corporation or other organization is an organization similar to a specified partnership, assets or rights that a member of that organization similar to a specified partnership owns or holds as assets of that organization are deemed to be owned or held by that organization similar to a specified partnership.