TOKYO (Reuters) – Japan announced on Friday a list of its companies subject to tighter foreign ownership rules, including major companies such as Toyota Motor Corp (7203.T) and Sony Corp (6758.T), as the United States and Europe intensify the examination of industries essential to national security.
FILE PHOTO: FILE PHOTO: A man walks past a Toyota logo at the Tokyo Motor Show in Tokyo, Japan, October 24, 2019. REUTERS / Edgar Su
Japan has identified 518 of its roughly 3,800 listed companies as having operations essential to national security, making them targets for strict regulations, a list released by the Ministry of Finance (MOF) showed.
The stricter rules regarding foreign investment in a dozen sectors essential to national security, such as oil, railways, public services, arms, space, nuclear energy, aviation, telecommunications and cybersecurity will take effect on Friday.
Foreign investors buying a stake of 1% or more in Japanese companies in the 12 regions are now in principle subject to a pre-selection, compared to the previous threshold of 10%.
“The revised law aims to accelerate foreign direct investment in Japan,” said Finance Minister Taro Aso, referring to a law passed in November and adding that technology and patents should be protected from a security perspective. national.
“As we explained our intention abroad, the badly directed criticisms, like that of limiting the foreign investments in Japan, disappeared.”
Some analysts say the revised law reflects Tokyo’s concerns about China’s growing influence in sectors such as defense, risking confidential information leaks and key technology releases.
However, critics have argued that the regulations discourage foreign investors on the Japanese stock market and run counter to the government’s efforts to attract investment to revitalize the economy.
Exemptions to allay these concerns include investments without prequalification by foreign financial institutions and the waiver of advance reporting requirements for certified sovereign wealth funds and other investors who meet certain criteria.
Foreign investors have a huge influence on stock prices, as they hold around 30% of the Japanese stock market of around 575 trillion yen and account for around 60% of the turnover.
For a complete list, open the file on the MOF website:
Tetsushi Kajimoto report; Editing by Jacqueline Wong and Clarence Fernandez