Foreign Exchange and Foreign Trade Control Law. Copyright Roderick Seeman

Article 23 (Screening the particulars of capital transactions, and recommendations of alteration thereof, etc.)

1. Any resident or non-resident who has given the notice under the provisions of Paragraph 1 of the preceding Article, concerning the capital transactions mentioned in Item (1) of Paragraph 1 of the previous Paragraph (excluding the transactions involving a claimable right creation, etc., under a money borrowing contract by a resident from a non-resident), or those capital transactions listed in Items (4) through (6) and (8) of the same Paragraph (for capital transactions listed in Item (8), among those involving the acquisition by a non-resident of land in Japan or rights related thereto, limited to those as designated by the Minister of Finance) , shall not execute that capital transaction under notice until a period of twenty (20) days has elapsed, counting from the date of acceptance of the notice by the Minister of Finance. However, the Minister of Finance may shorten this period when he deems it not specifically harmful, judging from the particulars, etc., of the capital transaction under notice.

2. Only in such an event as when the Minister of Finance deems that if any capital transaction covered by the notice given in the preceding Paragraph were executed it might result in one of the below-mentioned consequences and the achievement of the objectives of this Law might become difficult, may he recommend, as provided by Cabinet Order, that the person who gave the notice either alter the particulars of that capital transaction or suspend the execution thereof, provided that such recommendation is given within a period of twenty (20) days, counting from the day of his acceptance of the notice:

(1) It might adversely affect the international money market or derogate from the international reputation of Japan;

(2) It might adversely affect Japan’s money or capital market;

(3) It might adversely affect the business activities within designated industries or the smooth performance of our national economy; or

(4) It might disturb the faithful performance of treaties or other international agreements concluded by our country, or imperil the international peace and security, or disturb the maintenance of public order.

3. The person who is given recommendation under the provisions of the preceding Paragraph shall not, irrespective of the provisions of Paragraph 1, execute the capital transaction covered by the notice given in the same Paragraph until a period of twenty (20) days has elapsed, counting the day of his receipt of the recommendation.

4. The person who is given recommendation under the provisions of Paragraph 2 must notify the Minister of Finance whether he accedes to it or not within a period of ten (10) days, counting from the day of his receipt of the recommendation.

5. The person who has made his notice of his accession to the recommendation under the provisions of the preceding Paragraph must execute the capital transaction concerning the recommendation in accordance therewith.

6. The person who has given his notice of accession to recommendation under the provisions of Paragraph 4 may, regardless of the provisions of Paragraph 1 or 3, execute the capital transaction concerning the recommendation, even if the period of twenty (20) days has not elapsed.

7. When the person who has been given recommendation under the provisions of Paragraph 2, either fails to give his notice of accessions thereto under the provisions of Paragraph 4 or gives notice of his non-accession thereto, the Minister of Finance may order the party receiving the recommendation to either alter the conditions of the relevant capital transaction or to suspend the execution thereof. Provided that the period that such an order can be made is within a period of twenty (20) days, counting from the day of his giving the recommendation under the provisions of Paragraph 2.

8. In addition to those matters set out in each of the preceding Paragraphs, a Cabinet Order shall provide for the procedures of the recommendation to alter the conditions of the capital transaction or to suspend the execution thereof, and other necessary matters concerning the recommendation.