Archive 2008

TCI Granted Opportunity to Provide Explanation

Ministry of Finance
Ministry of Economy, Trade and Industry
April 25, 2008

The Minister of Finance and the Minister of Economy, Trade and Industry informed TCI (The Children’s Investment Master Fund) today that an opportunity to provide an explanation is granted to them pursuant to the Administrative Procedures Act (APA), as a necessary procedure before an order of discontinuance is given in relation to TCI’s requested further acquisition of shares of J-Power. The deadline for the submission of the explanation is May 8, 2008, 6 pm.

The Minister of Finance and the Minister of Economy, Trade and Industry made a recommendation to TCI on April 16, 2008, based on the provisions set forth in Article 27, Paragraph 5 of the Foreign Exchange and Foreign Trade Act (FEFTA), that TCI discontinue the inward direct investment as stipulated in the notification submitted by TCI on January 15, 2008 (the notification stating TCI’s plan to acquire further shares of J-Power).

TCI was requested to inform the Minister of Finance and the Minister of Economy, Trade and Industry of its acceptance or refusal of the recommendation before or on April 25, 2008, and, accordingly, TCI informed the ministries of its refusal to accept the recommendation today, April 25, 2008.

For this reason, today the Minister of Finance and the Minister of Economy, Trade and Industry informed TCI, based on the provisions set forth in Article 27, Paragraph 10 of the FEFTA, that the opportunity for an explanation is granted to them pursuant to Article 30 of the APA, as a necessary procedure before an order of discontinuance of the inward direct investment stipulated in TCI’s notification is given.

Contact points on this matter:
Legal Office, Research Division, International Bureau, MOF
TEL: +81-3-3581-8031
Trade Finance and Economic Cooperation Division, Trade and Economic Cooperation Bureau, METI
TEL: +81-3-3501-1664
Policy Planning Division, Electricity and Gas Industry Department, Agency for Natural Resources and Energy, METI
TEL: +81-3-3501-1746

(Appendix)- Related regulation

Foreign Exchange and Foreign Trade Act (Act No. 228 of December 1, 1949)

Final revision: Act No. 102 of October 21, 2005

Article 27 (Notification of Inward Direct Investment, etc. and Recommendation of a Change, etc.)

  1. When a foreign investor intends to make an inward direct investment, etc. (excluding those specified by Cabinet Order by taking into consideration inheritance, testamentary gift, merger of juridical persons or other circumstances; hereinafter the same shall apply in this article) specified by Cabinet Order as being likely to fall under inward direct investment, etc., which requires examination pursuant to paragraph 3, he/she shall notify in advance, pursuant to the provisions of Cabinet Order, the Minister of Finance and the minister having jurisdiction over the business of the business purpose, amount, time of making the investment, etc. and other matters specified by Cabinet Order in regard to the inward direct investment, etc.
  2. Abbreviation
  3. Where the Minister of Finance and the minister having jurisdiction over the business have received a notification pursuant to the provision of paragraph 1, when he/she finds it necessary to examine whether or not inward direct investment, etc. pertaining to the notification falls under any of the following inward direct investment, etc. (referred to as "Inward Direct Investment, etc. Pertaining to National Security, etc." in paragraphs 4, 5, and 11), he/she may extend the period in which inward direct investment, etc. pertaining to the notification is prohibited up to four months from the acceptance of the notification.
    1. Inward direct investment, etc. which is likely to cause any of the situations
      listed in (a) or (b) (limited to inward direct investment, etc., which is made by a foreign investor of a member state of a multilateral treaty or other international agreement on inward direct investment, etc., which is specified by Cabinet Order and to which Japan has acceded (hereinafter referred to as "Treaty, etc." in this item), and which is free from the obligations pursuant to the Treaty, etc. in regard to removal of restrictions on inward direct investment, etc., and inward direct investment, etc. made by a foreign investor of a state other than the member states of the Treaty, etc., which would be free from the said obligations if the state was a member state of the Treaty, etc.)
      • National security is impaired, the maintenance of public order is disturbed, or the protection of public safety is hindered.
      • Significant adverse effect is brought to the smooth management of the Japanese economy.
    2. Abbreviation
    3. Abbreviation
  4. Abbreviation
  5. Where the Minister of Finance and the minister having jurisdiction over the business have extended the period in which inward direct investment, etc. is prohibited pursuant to the provision of paragraph 3, when he/she finds through examination pursuant to the said provision that inward direct investment, etc. pertaining to a notification pursuant to the provision of paragraph 1 falls under Inward Direct Investment, etc. Pertaining to National Security, etc., he/she may recommend a person who has given notification of the inward direct investment, etc. to change the content pertaining to the inward direct investment, etc. or discontinue the inward direct investment, etc. pursuant to the provisions of Cabinet Order after hearing opinions of the Council on Customs, Tariff, Foreign Exchange and other Transactions; provided, however, the period for making the recommendation of the change or discontinuance shall be up to the expiration date of the period extended pursuant to the provision of paragraph 3 or 6, counting from the day of acceptance of the notification.
  6. Abbreviation
  7. Any person who has received a recommendation pursuant to the provision of paragraph 5 shall notify the Minister of Finance and the minister having jurisdiction over the business of whether to accept the recommendation within 10 days from the day of receipt of the recommendation.
  8. Abbreviation
  9. Abbreviation
  10. Where a person who has received a recommendation pursuant to the provision of paragraph 5 has not given a notice pursuant to the provision of paragraph 7 or has given a notice of refusal of the recommendation, the Minister of Finance and the minister having jurisdiction over the business may order the person to change the content pertaining to the inward direct investment, etc., or to discontinue the inward direct investment, etc.; provided, however, that the period for giving an order of the change or discontinuance shall be up to the expiration date of the period extended pursuant to the provision of paragraph 3 or 6, counting from the day of acceptance of the notification.

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