CABINET ORDER RELATING TO DIRECT INWARD INVESTMENTS, ETC. COPYRIGHT RODERICK SEEMAN

Article 3 (Notification of Direct Domestic Investments, and Delivery, etc., of the Recommendations for Alteration, etc.)

1 The matters to be designated by Cabinet Order as provided in Article 27, Paragraph 1 of the Law, shall be the direct domestic investments, etc. falling under any of the items listed hereunder:

(1) Direct domestic investments in industries designated by the ordinance of the Competent Ministry as an industry falling under either (a) or (b) (excluding direct domestic investments, etc listed in Article 26, Paragraph 1, Item 6 of the Law that are loans less than one billion yen)

(a). Industries related to direct domestic investments for which there are concerns that there will be harm to national security, prevent the maintenance of public order, or prevent the preservation of public safety.

(b). Industries related to direct domestic investments, reserved, based on Article 2b of the provisions of Japan's liberalization of capital movements in the Organization of Economic Cooperation and Development.

(2) Direct domestic investments, as designated by the ordinance of the Competent Ministry as those for which there are concerns that they are classifiable as direct domestic investments, etc. listed in Article 27, Paragraph 3, Item 2 of the Law.

(3) Direct domestic investments, as designated by the ordinance of the Competent Ministry as those for which there are concerns that they correspond to the capital transactions related to the designations made by the Ministry of Finance based on the provisions of Article 11, Paragraph 1 of the Foreign Exchange Control Order (Order No. of 1980)

2.The notification based on the provisions of Article 27, Paragraph 1 of the Law, must be made based on the procedures determined by the ordinance of the Competent Ministry within 3 months prior to the date that the direct domestic investment is to be made.

3. In those situations where the foreign investor who must make the notification based on the provisions of Article 27, Paragraph 1 of the Law, is classifiable as one of those listed in Item 1 or Item 2 of Article 26, Paragraph 1 of the Law, the said foreign investor must make the said notification via a resident agent (limited to those who have the authority to receive the documents sent based on the provisions of Paragraph 6 and Paragraph 11)

4.The matters to be determined by Cabinet Order as provided in Article 27, Paragraph 1 of the Law, shall be those matters listed hereunder:

(1) The name, address or residence, nationality or profession of the party who is to make the direct domestic investment, etc. (where it is a corporation or other organization, its, name, the address of its main office, the particulars of the business in which it engages, paid up capital and the name of its representative

(2) The business objective related to the direct domestic investment, etc.

(3) The monetary amount and timing of execution of the direct domestic investment, etc.

(4) The reason for making the direct domestic investment.

(5) Such other matters provided by the ordinance of the Competent Ministry.

5. The matters to be provided by Cabinet Order as provided for in Article 27, Paragraph 3 of the Law, shall be the Organization of Economic Development and Cooperation Treaty (limited to that portion of the provisions related to the determinations of liberalization of capital transactions based on the provisions of Article 5(a) of the said Treaty) and the Supplementary Documents General Agreement 1-B, Concerning Services Trade, of the Marakesh Agreement Establishing the World Trade Organization.

6. Extension of the term during which the direct inward investment, etc., cannot be made, based on the provisions of Article 27, Paragraph 1 or Paragraph 3 of the Law, shall be made via delivery by mail or hand delivery, of a document, in which is denoted the term of the said extension, to the address, residence, or place of business of the party who should receive that delivery. Provided, however, that in the case where the report of the said direct inward investment, etc., has been made through the resident representative of a foreign investor, delivery shall be made to the address, residence or place of business of the said representative.

7. In those situations where the delivery of the documents provided for in the preceding paragraph is made by mail in the normal course of handling, it shall be presumed that delivery of that postal matter was made at the time when normal delivery should be made.

8. In those situations where the Minister of Finance and the Minister having jurisdiction over the relevant industry send the document as provided for by Paragraph 1, by mail in the normal course of handling, they must prepare records which adequately verify the name (for corporations or other organizations, their corporate names), and address of the party who should receive the said document (in the situations of the proviso of the same paragraph, the representative, in the following paragraph and Paragraph 10, the same) and the date of dispatch of the said document.

9. The hand delivery of Paragraph 6 shall be made by employees of the said government institution (including the employees of The Bank of Japan who are engaged in duties listed in Article 10, Item 4, based in the provisions of Article 69, Paragraph 1 of the Law) by hand delivery of document to the party who should receive that delivery at the place where the document should be delivered based on the provisions of Paragraph 6. Provided, however, that when the party who should receive that delivery does not object, the hand delivery of the said document can be made at another place.

10. For any of the situations listed in the Items hereunder, the hand delivery of Paragraph 6, can be made by the act designated in each of the said items, in place of hand delivery based on the provisions of the preceding paragraph:

(1) Where the party who should receive the delivery of the document as provided for in Paragraph 1 is not present at the place where delivery should be made, hand delivery of the said document may be made to an employee, other worker, or a person at the same residence who has appropriate knowledge as to receipt of the said document (in the following item referred to as "employee, etc.").

(2) Where the party who should receive the delivery of the document as provided for in Paragraph 1, and other employees, etc., are not present at the place where delivery should be made or those parties refuse to receive the said documents without justifiable reason - leaving the said documents at the place where they should be delivered.

11. The recommendations or orders based on the provisions of Article 27, Paragraph 5 or Paragraph 10 of the Law shall be made via delivery, by mail or hand delivery, of a document, in which is denoted the substance of the said recommendations or orders, to the address, residence or place of business of the party who should receive that delivery. Provided, however, that in the case where the report of the said direct inward investment, etc., has been made by the resident representative of a foreign investor, delivery shall be made to the address, residence or place of business of the said representative.

12. The provisions of Paragraphs 7 through 10 shall apply mutatis mutandis to the documents in which are denoted the substance of the recommendations or orders as provided in the preceding paragraph. In that situation, the "preceding paragraph" in Paragraph 7 and the "Paragraph 6" in Paragraph 8 shall be read "Paragraph 11", and the "Paragraph 6" in Paragraph 9 shall be read "Paragraph 11", and the "Paragraph 10, Item 4" shall be read "Paragraph 10, Item 5 or Item 7", and "Paragraph 6" in Paragraph 10 shall be read "Paragraph 11".

13. The notice based on the provisions of Article 27, Paragraph 7 of the Law must be made by procedures designated by the Ordinance of the Competent Ministry.