Order for Enforcement of the Income Tax Act

In the case where a Resident acquires money or other assets as a return of capital (meaning a return of capital prescribed in Article 25, paragraph (1), item (iv) (Amounts Deemed to Constitute Dividends) of the Act; the same applies in item (i)) or a distribution of residual assets upon dissolution (hereinafter in this paragraph referred to as "refund, etc.") by the corporation that issued shares held by the Resident (hereinafter in this paragraph referred to as "old shares"), for the calculation of the assessed value of the old shares under Article 105, paragraph (1) (Methods of Valuing Securities) in each year on or after the year that includes the date of that refund, etc., the acquisition price per share of the old shares that serves as the basis of that calculation is the amount obtained by deducting, from the previous acquisition price of one old share, the amount calculated by multiplying the previous acquisition price of one old share by the ratio prescribed in Article 61, paragraph (2), item (iv), (a) (Method of Calculating the Amount of Stated Capital, etc. Corresponding to Shares Held) pertaining to that refund, etc. (in the cases set out in the following items, the ratio specified in the relevant item pertaining to that refund, etc.; referred to in the following paragraph as the "refund ratio"), and the old shares are deemed to have been acquired on that date.

In the case where that refund, etc. is a return of capital carried out by a corporation that had issued two or more classes of shares: the class refund ratio prescribed in Article 61, paragraph (2), item (iv), (b) pertaining to those old shares;

In the case where that refund, etc. is a distribution that reduces contributions prescribed in Article 24, paragraph (1) (Dividend Income) of the Act: the ratio prescribed in Article 61, paragraph (2), item (v).

A corporation that issued the old shares prescribed in the preceding paragraph must, where it has made a refund, etc. prescribed in that paragraph, notify the individual who received that refund, etc. of the refund ratio pertaining to that refund, etc.

In the case where a Resident acquires money or other assets as a refund of contributions of a corporation (hereinafter in this paragraph referred to as "refund") in respect of contributions in that corporation held by the Resident (limited to those with no fixed number of units; hereinafter in this paragraph referred to as "contribution held"), for the calculation of the assessed value of the contribution held under Article 105, paragraph (1) in each year on or after the year that includes the date of that refund, the acquisition price per unit of the contribution held that serves as the basis of that calculation is the amount obtained by deducting, from the previous acquisition price of one unit of the contribution held, the amount calculated by multiplying the previous acquisition price of one unit of the contribution held by the ratio that the amount of the contribution pertaining to that refund bears to the amount of that contribution held immediately before that refund, and the contribution held after that refund is deemed to have been acquired on that date.

In the case where a Resident receives money as a refund of principal (excluding a refund due to termination or partial cancellation of the trust, or a trust split, pertaining to that Specified Trust That Issues Beneficiary Certificates; hereinafter in this paragraph referred to as "refund") of a Specified Trust That Issues Beneficiary Certificates pertaining to a beneficial interest in such a trust held by the Resident (hereinafter in this paragraph referred to as "old beneficial interest"), for the calculation of the assessed value of the old beneficial interest under Article 105, paragraph (1) in each year on or after the year that includes the date of that refund, the acquisition price per unit of the old beneficial interest that serves as the basis of that calculation is the amount obtained by deducting, from the previous acquisition price of one unit of the old beneficial interest, the amount calculated by multiplying the previous acquisition price of one unit of the old beneficial interest by the principal reduction ratio (meaning the ratio that the amount of principal reduced by that refund bears to the amount of principal of the Specified Trust That Issues Beneficiary Certificates pertaining to that old beneficial interest immediately before that refund (where there is a fraction below the third decimal place in that ratio, it is rounded up); the same applies in the following paragraph), and the old beneficial interest is deemed to have been acquired on that date.

The trustee of a Specified Trust That Issues Beneficiary Certificates pertaining to the old beneficial interest prescribed in the preceding paragraph must, where it has made a refund prescribed in that paragraph, notify the individual who received that refund of the principal reduction ratio.

In the case where a Resident receives a distribution of proceeds in respect of a beneficial interest in an Open-Ended Securities Investment Trust held by the Resident (hereinafter in this paragraph referred to as "old beneficial interest") (excluding the case of payment received upon termination of that Open-Ended Securities Investment Trust or partial cancellation of that Open-Ended Securities Investment Trust, and limited to the case where the distribution of proceeds includes a special distribution prescribed in Article 27 (Portion of Distributions of Proceeds of Open-Ended Securities Investment Trusts That Is Not Taxed)), for the calculation of the assessed value of the old beneficial interest under Article 105, paragraph (1) in each year on or after the year that includes the date of that distribution of proceeds, the acquisition price per unit of the old beneficial interest that serves as the basis of that calculation is the amount calculated by dividing the amount obtained by deducting the amount distributed as that special distribution from the amount calculated by multiplying the previous acquisition price of one unit of the old beneficial interest by the number of old beneficial interests held by the Resident immediately before that distribution of proceeds, by the number of those old beneficial interests, and the old beneficial interest is deemed to have been acquired on that date.

In the case where a Resident, with regard to part of a beneficial interest in an Investment Trust or a Specified Trust That Issues Beneficiary Certificates held by the Resident (hereinafter in this paragraph referred to as "old beneficial interest"), cancels part of the Investment Trust or Specified Trust That Issues Beneficiary Certificates pertaining to that old beneficial interest, for the calculation of the assessed value of the old beneficial interest under Article 105, paragraph (1) in each year on or after the year that includes the date of that partial cancellation, the acquisition price per unit of the old beneficial interest that serves as the basis of that calculation is the previous acquisition price of one unit of the old beneficial interest, and the old beneficial interest is deemed to have been acquired on that date.

In the case where a Resident has acquired, through an entity conversion of the corporation that issued the shares held by the Resident (hereinafter in this Article referred to as "old shares") (limited to an entity conversion in which only shares of the corporation that underwent that entity conversion (hereinafter in this Article referred to as the "corporation changing its organization") have been delivered to the Shareholders, Members, or Other Investors of that corporation changing its organization), shares of the corporation changing its organization (hereinafter in this Article referred to as "new shares"), for the calculation of the assessed value of the new shares under Article 105, paragraph (1) (Valuation Methods for Securities) for each year on or after the year in which the day of that entity conversion falls, the acquisition price per unit of the acquired new shares that forms the basis for that calculation is to be the amount calculated by multiplying the previous acquisition price of one unit of old shares (if there are expenses required for the acquisition of those new shares, the amount obtained by adding the portion of the amount of those expenses that corresponds to one unit of old shares) by the number of old shares and dividing the result by the number of new shares acquired.

In the case where a Resident, through a merger, company split, share exchange, or share transfer (hereinafter in this Article referred to as a "merger, etc.") in which the corporation that issued the share options or bonds with share options held by the Resident (hereinafter in this Article referred to as "former share options, etc.") is the merged corporation (meaning the merged corporation prescribed in Article 2, item (xi) (Definitions) of the Corporation Tax Act), the splitting corporation (meaning the splitting corporation prescribed in item (xii)-2 of that Article), the wholly owned subsidiary corporation in a share exchange (meaning the wholly owned subsidiary corporation in a share exchange prescribed in item (xii)-6 of that Article), or the wholly owned subsidiary corporation in a share transfer (meaning the wholly owned subsidiary corporation in a share transfer prescribed in item (xii)-6-5 of that Article), has received, in place of those former share options, etc., only share options or bonds with share options of the acquiring corporation (meaning the acquiring corporation prescribed in Article 2, item (xii) of that Act), the successor corporation in a company split (meaning the successor corporation in a company split prescribed in item (xii)-3 of that Article), the wholly owning parent corporation resulting from a share exchange (meaning the wholly owning parent corporation resulting from a share exchange prescribed in item (xii)-6-3 of that Article), or the wholly owning parent corporation in a share transfer (meaning the wholly owning parent corporation in a share transfer prescribed in item (xii)-6-6 of that Article), in each case pertaining to that merger, etc. (hereinafter in this Article referred to as "acquiring corporation's share options, etc."), for the calculation of the assessed value of the acquiring corporation's share options, etc. under Article 105, paragraph (1) (Valuation Methods for Securities) for each year on or after the year in which the day of that merger, etc. falls, the acquisition price per unit of the acquired acquiring corporation's share options, etc. that forms the basis for that calculation is to be the amount calculated by dividing the previous acquisition price of one unit of former share options, etc. (if there are expenses required for the acquisition of those acquiring corporation's share options, etc., the amount obtained by adding the portion of the amount of those expenses that corresponds to one unit of former share options, etc.) by the number of acquiring corporation's share options, etc. acquired for one unit of former share options, etc.

In the case where, in the middle of a year, an event prescribed in Articles 110 through the preceding Article (hereinafter in this Article referred to as an "event") occurs with respect to shares held by a Resident or beneficial interests in an Investment Trust or a Specified Trust That Issues Beneficiary Certificates, for the application of those provisions, based on the period from January 1 of that year (if another event has occurred between that day and the day of the event, the day of the other event immediately preceding that event) to the day of the event, the amount equivalent to the assessed value of the old shares, old beneficial interests, shares held, contribution held, or former share options, etc. prescribed in those provisions that the person holds on the day of the event, calculated by the valuation method the person has adopted, is the previous acquisition price of one old share, one unit of old beneficial interest, one share held, one unit of contribution held, one unit of old shares, or one unit of former share options, etc. prescribed in Articles 110 through the preceding Article.

In the case where a Resident has transferred Securities of the same class that were acquired on two or more occasions as prescribed in Article 48, paragraph (3) (Calculation of Acquisition Costs, etc. of Securities Giving Rise to Capital Gains) of the Act and that give rise to miscellaneous income or capital gains, the amount to be included in necessary expenses in calculating the amount of miscellaneous income of that person for the year in which the date of that transfer falls pursuant to Article 37, paragraph (1) (Necessary Expenses) of the Act, or the amount to be included in acquisition cost in calculating the amount of capital gains of that person for that year pursuant to Article 38, paragraph (1) (Acquisition Costs Deducted to Calculate Capital Gains) of the Act, in respect of that transfer, is to be the amount calculated, based on the period from the time the Securities were first acquired (if those Securities have already been transferred since then, the time of the immediately preceding transfer; the same applies hereinafter in this paragraph) to the time of that transfer, by the amount per unit calculated by a method equivalent to the total average method set forth in Article 105, paragraph (1), item (i) (Total Average Method) for the Securities held at the time of that first acquisition and the Securities acquired during that period.

The provisions of Articles 109 through the preceding Article apply mutatis mutandis to Securities that give rise to the income prescribed in the preceding paragraph.

In the case where a Resident has traded shares or public and corporate bonds by a margin transaction prescribed in Article 156-24, paragraph (1) (Licenses and License Applications) of the Financial Instruments and Exchange Act or a when-issued transaction (meaning a transaction specified by Ministry of Finance Order in which Securities are bought and sold before those Securities are issued) or by a method of transaction set forth in Article 28, paragraph (8), item (iii), (a) (General Provisions) of that Act, and has settled those transactions by selling and buying shares or public and corporate bonds in those transactions, the amount to be included in necessary expenses in calculating the amount of business income or the amount of miscellaneous income of that person for that year, as expenses required for acquiring the shares or public and corporate bonds pertaining to that sale, is to be, notwithstanding Articles 105 through the preceding Article, the amount required for acquiring the shares or public and corporate bonds pertaining to that purchase in those transactions.