Japan – Global Investment Law Watch

Japan Adopts “Asset Owner Principles” Amid Growing Interests in Alternative Investments Among Japanese Pensions

Sep 05 2024

On August 28, under the ongoing “Japan as a leading asset management center” policy initiative, the Japanese government adopted “Asset Owner Principles” (Principles), which are five “common principles” that are “useful” for asset owners in “fulfilling their responsibilities to manage assets (fiduciary duties) in consideration of the best interests of the beneficiaries.” Asset owners are described to include public pensions, benefit associations, corporate pensions, insurance companies and university funds. These Principles are:

Japan: FSA Requires Real Estate Funds Take Additional Safeguards Against Conflicts of Interest

May 08 2024

By: Tsuguhito Omagari, Yuki Sako, Jason Nelms and Charmaine Mok

Financial Services Agency of Japan (FSA) proposed amendments to its supervisory guidelines applicable to managers of investment trust (toshin) funds and real estate funds, and is currently accepting comments until May 13. Of those, amendments relating to real estate funds would require managers to take additional measures to manage transactional conflicts of interest, specifically:

Japan Shareholder Reporting Reform

Oct 31 2023

By: Yuki Sako

The Japanese government is currently considering (i) several amendments to the large shareholding reporting requirement, which is generally triggered when the position of a beneficial owner reaches 5% of outstanding shares, and (ii) a new mechanism to provide transparency around beneficial owners even when the 5% threshold is not reached. Notably, the stated purposes of these considerations include promoting engagement between companies and investors by removing obstacles for investors to effectively engage with companies and by making it easier for companies to identify beneficial owners.

Japan Will Create Special Business Zones for Asset Managers

Oct 04 2023

By: Yuki Sako

On 21 September 2023, the Prime Minister of Japan Kishida unveiled his new policy initiatives to support new entry of managers to Japan. In his speech at the Economic Club of New York, the Prime Minister announced his plan to (i) establish programs to support emerging managers, (ii) seek for legislative and regulatory changes necessary to allow outsourcing of back-office operations, and (iii) launch special business zones targeted for overseas asset managers in which all the regulatory processes are conducted in English and other business and living supports are provided.

JAPAN: Proposed Code of Conduct for ESG Evaluation and Data Providers Presents Significant Implications for Asset Management and Investor Communities

Aug 05 2022

By Yuki Sako

On 12 July 2022, as widely anticipated, the Financial Services Agency of Japan (“FSA”) proposed “the Code of Conduct for ESG Evaluation and Data Providers” (“Proposed Code”), and is soliciting comments from the public until 5 September 2022.

The stated focus of the Proposed Code is to provide a set of principles and guidelines for ESG evaluation and data providers (“Provider(s)”) that would require Providers who decide to endorse such code to “comply or explain” such code, i.e., a Provider would be required to comply with, or provide an explanation as to why the Provider is departing from, such code.

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