Supplementary Provisions

This Act comes into effect as of the date specified by Cabinet Order within a period not exceeding one year and six months from the date of promulgation.

The provisions (excluding penal provisions) of the Companies Act as amended by this Act (hereinafter referred to as "the New Companies Act") also apply to matters that arose before the day on which this Act comes into effect (hereinafter referred to as "the Effective Date"), except as otherwise provided in these Supplementary Provisions; provided, however, that this does not prejudice the effect that arose under the provisions of the Companies Act prior to the amendment by this Act (hereinafter referred to as "the Former Companies Act").

①The articles of incorporation of a stock company that is a company with committees (meaning a company with committees as prescribed in Article 2, item (xii) of the Former Companies Act; the same applies in the following paragraph) at the time this Act comes into effect, or of a stock company whose articles of incorporation (limited to those providing that the committees prescribed in that item are established) were certified under the provisions of Article 30, paragraph (1) of the Former Companies Act before the Effective Date and that is incorporated after this Act comes into effect, are deemed to provide that a nominating committee, etc. prescribed in Article 2, item (xii) of the New Companies Act is established.

②Registration of a company with committees under the provisions of the Former Companies Act is deemed to be registration of the matters set forth in Article 911, paragraph (3), item (xxiii) of the New Companies Act.

With regard to the outside directors or outside company auditors of a stock company that has outside directors prescribed in Article 2, item (xv) of the Former Companies Act or outside company auditors prescribed in item (xvi) of that Article at the time this Act comes into effect, the provisions then in force continue to govern until the conclusion of the annual shareholders meeting for the first business year ending after this Act comes into effect, notwithstanding the provisions of Article 2, item (xv) or (xvi) of the New Companies Act.

①The provisions of Article 23-2 of the New Companies Act do not apply to a transfer of business by a company to another company in the case where the agreement for that transfer of business was concluded before the Effective Date.

②With regard to a transfer of business by a company to a merchant (excluding a company; hereinafter the same applies in this paragraph) or an acceptance by a company of a transfer of the business of a merchant, in the case where the agreement for that transfer of business or acceptance of a transfer of business was concluded before the Effective Date, the provisions then in force continue to govern, notwithstanding the provisions of Article 24 of the New Companies Act.

The provisions of Article 52-2, Article 102, paragraphs (3) and (4), Article 102-2 and Article 103, paragraphs (2) and (3) of the New Companies Act do not apply to shares issued at incorporation that are issued at the incorporation of a stock company under articles of incorporation certified under Article 30, paragraph (1) of the Former Companies Act before the Effective Date.

With regard to the total number of authorized shares after an amendment to the articles of incorporation to the effect that a stock company that is not a public company becomes a public company, in the case where, before the Effective Date, the procedures for calling the shareholders meeting to adopt a resolution concerning that amendment to the articles of incorporation were commenced, the provisions then in force continue to govern, notwithstanding the provisions of Article 113, paragraph (3) of the New Companies Act.

With regard to the exercise of appraisal rights relating to any of the acts set forth in the items of Article 116, paragraph (1) of the Former Companies Act, in the case where, before the Effective Date, the procedures for calling the shareholders meeting to adopt a resolution relating to that act were commenced (or, if no resolution of a shareholders meeting is required in order to carry out the act set forth in any of the items of that paragraph, when the resolution of the board of directors or the decision of the directors or executive officers relating to that act was made), the provisions then in force continue to govern.

With regard to the exercise of appraisal rights on share options relating to an amendment to the articles of incorporation set forth in any of the items of Article 118, paragraph (1) of the Former Companies Act, in the case where, before the Effective Date, the procedures for calling the shareholders meeting to adopt a resolution relating to that amendment to the articles of incorporation were commenced, the provisions then in force continue to govern.

With regard to the acquisition of shares subject to class-wide call, in the case where, before the Effective Date, the procedures for calling the shareholders meeting to adopt the resolution under Article 171, paragraph (1) of the Former Companies Act were commenced, the provisions then in force continue to govern.

With regard to a consolidation of shares, in the case where, before the Effective Date, the procedures for calling the shareholders meeting to adopt the resolution under Article 180, paragraph (2) of the Former Companies Act were commenced, the provisions then in force continue to govern.

The provisions of Article 205, paragraph (2), Article 206-2, Article 209, paragraphs (2) and (3), Article 213-2 and Article 213-3 of the New Companies Act do not apply to shares for subscription in the case where the subscription requirements prescribed in Article 199, paragraph (2) of the Former Companies Act were determined before the Effective Date.

①The provisions of Article 244, paragraph (3), Article 244-2, Article 282, paragraphs (2) and (3), Article 286-2 and Article 286-3 of the New Companies Act do not apply to share options for subscription in the case where the subscription requirements prescribed in Article 238, paragraph (1) of the Former Companies Act were determined before the Effective Date.

②The provisions of Article 282, paragraphs (2) and (3), Article 286-2 and Article 286-3 of the New Companies Act do not apply to share options issued before the Effective Date (excluding share options for subscription).

With regard to an allotment of share options without contribution, in the case where, before the Effective Date, the matters set forth in the items of Article 278, paragraph (1) of the Former Companies Act were determined, the provisions then in force continue to govern.

With regard to the procedures for the election or dismissal of a financial auditor or for not reelecting a financial auditor, in the case where, before the Effective Date, the procedures for calling the shareholders meeting to adopt a resolution concerning the election or dismissal of a financial auditor or not reelecting a financial auditor were commenced, the provisions then in force continue to govern, notwithstanding the provisions of Article 344 of the New Companies Act.

With regard to partial exemption from liability based on acts of a director, accounting advisor, company auditor, executive officer or financial auditor committed before the Effective Date and to agreements limiting that liability, the provisions then in force continue to govern, notwithstanding the provisions of Articles 425 through 427 of the New Companies Act. In this case, with regard to the application of the provisions of Article 425, paragraph (3) of the Former Companies Act (including when it is applied mutatis mutandis pursuant to Article 426, paragraph (2) and Article 427, paragraph (3) of the Former Companies Act; hereinafter the same applies in this Article) to a stock company that is a company with audit and supervisory committee (meaning a company with audit and supervisory committee prescribed in Article 2, item (xi)-2 of the New Companies Act) at the time when the partial exemption from that liability is to be granted, the phrase "company with company auditor or company with committees" in Article 425, paragraph (3) of the Former Companies Act is deemed to be replaced with "company with audit and supervisory committee (meaning a company with audit and supervisory committee prescribed in Article 2, item (xi)-2 of the Companies Act as amended by the Act Partially Amending the Companies Act (Act No. 90 of 2014) (hereinafter referred to in this paragraph as the 'new Companies Act'))", and the phrase "the persons specified in the respective items for the categories of stock companies set forth in those items" is deemed to be replaced with "each audit and supervisory committee member (meaning an audit and supervisory committee member prescribed in Article 38, paragraph (2) of the New Companies Act)".

With regard to a transfer of all or part of the shares or equity interests in a subsidiary company, in the case where the agreement for that transfer was concluded before the Effective Date, the provisions then in force continue to govern, notwithstanding the provisions of Article 467, paragraph (1) and Article 536, paragraph (1) of the New Companies Act.

With regard to a business transfer, etc. prescribed in Article 468, paragraph (1) of the Former Companies Act, in the case where the agreement for that business transfer, etc. was concluded before the Effective Date, the provisions then in force continue to govern, notwithstanding the provisions of Articles 469 and 470 of the New Companies Act.

With regard to the company auditors of a liquidating stock company that came to fall under any of the cases set forth in the items of Article 475 of the Former Companies Act before the Effective Date, the provisions then in force continue to govern, notwithstanding the provisions of Article 478, paragraphs (6) and (7) of the New Companies Act.

With regard to an entity conversion, merger, absorption-type company split, incorporation-type company split, share exchange or share transfer for which the merger agreement, absorption-type company split agreement or share exchange agreement was concluded, or the entity conversion plan, incorporation-type company split plan or share transfer plan was prepared, before the Effective Date, the provisions then in force continue to govern.

①With regard to an action to enforce liability prescribed in Article 847, paragraph (1) of the Former Companies Act, in the case where that action to enforce liability was filed before the Effective Date, the provisions then in force continue to govern.

②The provisions of Article 847-2 of the New Companies Act do not apply in the case where any of the acts set forth in the items of paragraph (1) of that Article became effective before the Effective Date.

③The provisions of Article 847-3 of the New Companies Act do not apply to specific liability (meaning the specific liability prescribed in paragraph (4) of that Article) where the facts that caused it arose before the Effective Date.

①A stock company whose articles of incorporation, at the time this Act comes into effect, provide that the scope of the audit by its company auditors is limited to an audit related to accounting is not required to register the matters set forth in Article 911, paragraph (3), item (xvii), (a) of the New Companies Act until a company auditor first assumes office or retires from office after this Act comes into effect.

②If, at the time this Act comes into effect, a registration under the provisions of Article 911, paragraph (3), item (xxv) or (xxvi) of the Former Companies Act has been made for a stock company, that stock company is not required to cancel that registration, limited to the term of office of the directors or company auditors to which that registration pertains.

With regard to the application of penal provisions to acts committed before the Effective Date and to acts committed on or after the Effective Date in the cases where the provisions then in force continue to govern pursuant to the provisions of these Supplementary Provisions, the provisions then in force continue to govern.

Beyond what is provided for in these Supplementary Provisions, transitional measures necessary in connection with the enforcement of this Act are specified by Cabinet Order.

In the case where two years have elapsed after this Act comes into effect, the Government is to review the state of the systems related to corporate governance, taking into consideration the status of election of outside directors and other changes in socioeconomic conditions, etc., and, if it finds it necessary, is to take the required measures, such as making it mandatory to have outside directors, based on the results of the review.