Nagashima Ohno & Tsunematsu


Nagashima Ohno & Tsunematsu is the first integrated full-service law firm in Japan and one of the foremost providers of international and commercial legal services based in Tokyo.  The firm’s overseas network includes offices in New York, Singapore, Bangkok, Ho Chi Minh City, Hanoi and Shanghai, associated local law firms in Jakarta and Beijing where our lawyers are on-site, and collaborative relationships with prominent local law firms throughout Asia and other regions.  In representing our leading domestic and international clients, we have successfully structured and negotiated many of the largest and most significant corporate, finance and real estate transactions related to Japan.  The firm has extensive corporate and litigation capabilities spanning key commercial areas such as antitrust, intellectual property, labor and taxation, and is known for path-breaking domestic and cross-border risk management/corporate governance cases and large-scale corporate reorganizations.  The over 450 lawyers of the firm, including over 30 experienced foreign attorneys from various jurisdictions, work together in customized teams to provide clients with the expertise and experience specifically required for each client matter.



Amendments to Payment Services Act
Japan | 26 April 2019

Cabinet recently submitted a bill to the 198th session of the Diet to amend, among other acts, the Payment Services Act (PSA). The PSA amendments aim to strengthen the regulation of virtual currency exchange service providers. Among other things, the changes concern crypto asset custody, the advertisement and solicitation of crypto assets and crypto asset margin transactions.

Does factoring require a lending licence?
Japan | 12 January 2018

In Japan, money lending operations are subject to certain licensing requirements. That said, it is generally understood that a registration under the Money Lending Business Act is not required to purchase existing receivables. Thus, it may be easier for non-Japanese financial institutions to acquire receivables as opposed to making loans using funds from their own accounts. However, a recent Osaka District Court judgment suggests that this may not always be the case.

Acquisition of Japanese loans by non-Japanese financial institutions
Japan | 15 September 2017

Financial institutions that have no operations in Japan can readily acquire loans made to Japanese borrowers by purchasing the receivables relating to such loans. A number of requirements and considerations must be taken into account when transferring loan receivables, including with regard to novation, money lending operations, registered money lenders, perfection and the upcoming amendments to the Civil Code.

Capital Markets

Amendments to Financial Instruments and Exchange Act
Japan | 30 April 2019

Cabinet recently submitted a bill to the 198th session of the Diet to amend, among other acts, the Financial Instruments and Exchange Act and the Payment Services Act. Among other things, the amendments introduce new regulations for security-type digital tokens (ie, initial coin offerings and security token offerings) and clarify that digital tokens issued in consideration for crypto assets will be regarded as deemed securities.

Determining recoverable damages following material misstatements in securities registration statements
Japan | 02 April 2019

If a securities registration statement contains a material misstatement, investors that acquire securities through the relevant offering can hold the issuing company liable for related damages. However, it is unclear what level of damages is recoverable if the issuing company successfully proves that the loss incurred by the investor is at least partly attributable to an unrelated factor or circumstance. A recent Supreme Court judgment has provided some clarity in this regard.

Kyoto District Court rules on raising of capital by third-party allotment
Japan | 08 January 2019

The Kyoto District Court recently ruled in favour of a shareholder's petition that a listed issuer cease an offering of its new shares by third-party allotment on the grounds that the offering had been conducted through an 'extremely unfair method', despite having been approved by a resolution at the issuer's shareholders' meeting. The court adopted the main purpose rule in accordance with prior court rulings and concluded that the share offering's main purpose had been to reduce the petitioning shareholder's shareholding.

Bond offerings under Japanese securities law
Japan | 18 December 2018

Foreign private issuers' bonds that are listed on a Japanese securities exchange, such as the Tokyo Pro-Bond Market (TPBM), are subject to both the insider trading rules and the fair disclosure rules under Japanese law, while non-listed bonds (so-called 'Samurai bonds') are not. This article provides a brief explanation of the rules that apply to offerings of Samurai bonds and bonds listed on the TPBM under Japanese securities law.

Application of fair disclosure rule to listed bonds
Japan | 09 October 2018

The newly introduced fair disclosure rule enacted under Japan's securities laws and regulation regime is most often considered to apply to issuers of listed shares. However, based on the clear wording of the rule, it is also applicable to issuers whose only listed securities are bonds. Although the majority of bonds issued in the Japanese market are unlisted, there is a market dedicated to listed bonds in Japan: the Tokyo Pro-Bond Market.

Insider trading rule under Financial Instruments and Exchange Act
Japan | 14 August 2018

The recent amendments to the Financial Instruments and Exchange Act introduced the fair disclosure rule, preventing listed issuers from making selective disclosure of their material information in order to ensure market fairness and transparency. This rule differs to the insider trading rule, which was introduced in 1989 with a similar aim of ensuring fairness and transparency by prohibiting parties with knowledge of undisclosed material facts regarding listed issuers from trading the securities of such issuers.

Are lead managers liable for material misstatements in IPO disclosure documents?
Japan | 17 July 2018

A recent Tokyo District Court decision was reported to be the first to hold an underwriter liable to investors that purchased shares in a company based on material misstatements in the financial information contained in the statutory disclosure document for a public offering in Japan. However, the Tokyo High Court overturned the district court decision in this regard and concluded that the lead manager was not liable to investors.

Finalisation of fair disclosure rule under securities law
Japan | 03 April 2018

In June 2017 the Financial Instruments and Exchange Act was amended to introduce the fair disclosure rule in Japan. Subsequently, in October 2017 the Financial Services Agency (FSA) published draft legislation (comprising an implementing order and an ordinance) and guidelines for public comment, followed by final legislation in December 2017. The FSA has now published new guidelines and opinions on the public comments that it received.

Fair disclosure rule under securities law
Japan | 21 November 2017

In June 2017 the Financial Instruments and Exchange Act was amended to introduce the so-called 'fair disclosure' rule in Japan. The amendments address recent cases of selective disclosure of material information by issuers to sell-side analysts and investors' requests to introduce similar fair disclosure rules to those of other jurisdictions. The Financial Services Agency recently published a draft implementing order, ordinance and guidelines for public comment.

Competition & Antitrust

New commitment procedure under Anti-monopoly Act
Japan | 18 April 2019

A new commitment procedure was recently introduced to the Anti-monopoly Act (AMA), enabling enterprises to voluntarily resolve suspected violations of the AMA with the Japan Fair Trade Commission (JFTC). If a commitment is approved, the conduct of the enterprise concerned will not be considered a violation of the AMA and the enterprise will not be subject to legal penalties. The new procedure may lead to more active enforcement by the JFTC.

The Leniency Programme
Japan | 22 February 2007

The leniency programme for surcharge payments in case of cartel and bid rigging was introduced into the Anti-monopoly Law over a year ago. Among other things, the first company to apply for leniency before the commencement of the commission's investigation receives total immunity from the surcharge payment; the second company to apply for leniency receives a 50% reduction of the surcharge payment.

Anti-monopoly Act Reform in Progress
Japan | 21 September 2006

Court Injunction System under the Anti-monopoly Act
Japan | 15 June 2006

In accordance with Article 24 of the Anti-monopoly Act, private entities (including business enterprises and consumers) may seek a court injunction ordering business enterprises to cease engaging in unfair business practices where private business enterprises or consumers are likely to suffer significant damage. This update provides an overview of the court injunction system under Article 24 of act.

Amendment to the Anti-monopoly Act
Japan | 13 April 2006

Employment & Benefits

Amendments to regulations on working hours and paid annual leave
Japan | 10 April 2019

A number of amendments to Japan's labour and employment laws recently took effect. Among other things, the amendments concern the monitoring of employee working hours, paid annual leave, the so-called 'highly professional system' and overtime limits. Employers should ensure that their policies and practices comply with the amendments to ensure an easy transition to Japan's new employment framework.

Fixed overtime payment arrangements
Japan | 27 March 2019

Under Japanese law, employers must – in principle – pay an allowance to employees who work more than eight hours per day or 40 hours per week. As such, from an employer's perspective, it is practical to include an employee's overtime allowance in their base salary where possible. However, for an employee's overtime allowance to be validly included in their base salary, certain requirements must be satisfied. These requirements are a hot topic in Japanese legal practice.

Overtime regulation bill enacted
Japan | 17 October 2018

The National Diet recently enacted a bill relating to work style reform, which has amended the Labour Standards Act, the Industrial Safety and Health Act and relevant laws. Most amendments will come into effect on 1 April 2019. The amended Labour Standards Act stipulates that the upper limit for overtime will be, in principle, 45 hours a month and 360 hours a year. However, there are exceptions for certain business sectors.

Supreme Court rules on different working conditions for employees rehired after reaching retirement age
Japan | 26 September 2018

One of the controversial issues regarding Japan's so-called 'lifetime employment system' is whether and to what extent employers can impose different working conditions (eg, salaries, bonuses and allowances) when they rehire employees who were once non-fixed-term employees as fixed-term employees. The Supreme Court recently handed down a significant decision addressing this issue.

Are differences in employment conditions of fixed-term and permanent employees reasonable?
Japan | 11 July 2018

Article 20 of the Labour Contract Act prohibits the imposition of unreasonable employment conditions on fixed-term employees in order to ensure their fair treatment. In light of two recent Supreme Court decisions on this matter, Japanese employers with both fixed-term and permanent employees should carefully review whether differences in the individual employment conditions of each type of employee are not unreasonable.

Employees' statutory rights to convert fixed-term contracts to indefinite term contracts
Japan | 04 April 2018

An amendment to the Labour Contracts Act states that if an employee with a fixed-term employment contract has been continuously employed by the same employer for more than five years, the employee will have the right to convert his or her fixed-term employment contract to an indefinite term employment contract. As the amendment applies only to employment contracts that commenced on or after April 1 2013, a significant number of employees became eligible to exercise this right on April 1 2018.

Overtime regulation bill to undergo deliberation
Japan | 31 January 2018

In September 2017 the Ministry of Health, Labour and Welfare issued the Outline of the Act for Revising Related Acts for the Promotion of Work Style Reform. Once the National Diet passes the bill in 2018 and the revised Labour Standards Act takes effect at a later date, companies will be required to implement a new scheme to manage working hours which is substantially different from the existing scheme. As such, the proposed amendment will continue to garner significant attention going forward.

Equal pay for equal work: recent trends
Japan | 01 November 2017

In recent years, the government-established Council for the Realisation of Work Style Reform has frequently discussed how to realise the international trend of equal pay for equal work in Japan. Further, the Japanese courts have rendered some noteworthy judgments regarding the equal pay for equal work principle. As such, the government is in the process of amending the rules on equal pay for equal work, which will significantly affect Japanese employment practice.

New Action Plan for Realisation of Work Style Reform
Japan | 07 June 2017

The Council for the Realisation of Work Style Reform recently approved its action plan. To implement the plan, which the government has since adopted, certain legal amendments must be enacted. A number of related bills are expected to be tabled before the National Diet in 2017 and will likely garner significant attention.

Ministry of Health, Labour and Welfare strengthens overtime regulations
Japan | 19 April 2017

In recent years, excessively long overtime hours have been an issue in Japan. In accordance with the Labour Standards Act, the maximum working hours are eight hours a day, 40 hours a week, and company directors who violate this article are subject to imprisonment with labour or a fine. While an employer can extend its employees working hours in certain circumstances under a so-called '36 agreement', the Ministry of Health, Labour and Welfare has set out the upper limits for such overtime work.

Product Regulation & Liability

Recharacterisation of product risks
Japan | 18 April 2019

Although product compliance has always been an important issue for manufacturers, it has historically been overshadowed by safety-related product risks, and considerations regarding product compliance have typically been integrated with other product risks. However, manufacturers' awareness of the risks associated with product compliance has grown and it is now a top priority. The catalyst for this shift in attitude was a recent spate of data falsification cases.

Tech, Data, Telecoms & Media

Enforcement of amended personal information protection regime
Japan | 29 August 2017

The widely publicised amendments to the Act on the Protection of Personal Information recently came into force. In addition to changing how companies must handle personal information, the amendments reflect a significant shift in how such obligations are regulated and enforced. They also mark the establishment of the Personal Information Protection Commission, which will be the regulatory body responsible for managing and ensuring compliance with the amended act.

White Collar Crime

Whistleblowing certification regime launched
Japan | 13 May 2019

Over the past decade, a number of significant regulatory and compliance issues have affected large multinationals based in Japan. As such, the Consumer Affairs Agency recently created a certification regime for corporate whistleblowing systems, which is designed to incentivise businesses to voluntarily enhance their own whistleblowing systems and thereby gain the trust of various stakeholders, including shareholders, counterparties and consumers.

Heightened sensitivity in Japan over virtual currencies
Japan | 01 October 2018

In 2017, following consultations with representatives of the virtual currency (VC) industry, the Act on Payment and Settlement and the Act on the Prevention of Transfer of Criminal Proceeds were amended to require operators of VC exchange businesses to register with the Japanese Financial Services Agency (JFSA). Notably, the amendments reflect the JFSA's desire to implement a risk-based approach with respect to anti-money laundering and terrorist financing.

Are lead managers liable for material misstatements in IPO disclosure documents?
Japan | 16 July 2018

A recent Tokyo District Court decision was reported to be the first to hold an underwriter liable to investors that purchased shares in a company based on material misstatements in the financial information contained in the statutory disclosure document for a public offering in Japan. However, the Tokyo High Court overturned the district court decision in this regard and concluded that the lead manager was not liable to investors.

Japan Exchange Regulation publishes principles to prevent corporate scandals
Japan | 04 June 2018

In response to the significant corporate scandals that have come to light in recent years, Japanese authorities and regulators have been working to improve compliance awareness within corporate Japan. The Japan Exchange Regulation (JPX-R) recently published the Principles for Preventing Corporate Scandals, which provide valuable insight into the views of the JPX-R and, by extension, other Japanese regulators.

Are privilege protections coming to Japan?
Japan | 26 March 2018

The absence of attorney-client privilege protections in Japan means that regulatory investigations must be handled with particular care. Various industry parties have argued that the absence of such protections unfairly damages the interests of companies active in Japan. However, the government has refused to introduce such protections out of concern that they could limit the regulators' broad investigative powers or otherwise adversely affect the Japanese regulatory environment.

Gift giving in corporate Japan: US Foreign Corrupt Practices Act considerations
Japan | 20 November 2017

Japan's spirit of omotenashi (ie, hospitality) encompasses many aspects of Japanese culture and etiquette, including the practice of gift giving. Many Japanese companies invest heavily in nurturing long-term business partners and, as such, the practice of giving gifts to business partners is relatively common. However, a number of risks may arise in this regard under international anti-corruption legislation, particularly the US Foreign Corrupt Practices Act.

New plea bargaining system: a new compliance risk for companies with operations in Japan?
Japan | 10 April 2017

Various initiatives in recent years have set in motion a number of reforms to the Japanese criminal justice system. Of most interest to businesses operating in Japan is undoubtedly the introduction of Japan's first plea bargaining system, which will likely incentivise both Japanese and global companies in Japan to take meaningful steps to bolster corporate compliance in order to avoid the sometimes devastating consequences of serious corporate malfeasance.

A world first? New guidance issued for listed companies conducting internal investigations
Japan | 22 August 2016

In early 2016 the Japan Exchange Regulation released its Principles for Listed Companies Dealing with Corporate Malfeasance. The principles appear to be the first example of a national stock exchange setting out specific guidelines on how a corporation should behave when faced with a corporate scandal and, as such, are an example of Japan leading the way in this increasingly important area of corporate governance.

Maintaining privilege in the face of regulatory investigations
Japan | 02 November 2015

Attorney-client privilege is a well-established principle in many jurisdictions. The effective absence of this form of protection in Japan is notable for a number of reasons, but one of the most important is that it means that Japanese regulators are permitted to compel the production of or seize sensitive communications, materials and advice received from legal counsel. This is of particular concern in the context of regulatory investigations.

The Olympus effect? Recent changes to whistleblower law regime
Japan | 03 August 2015

The Olympus accounting scandal and Toshiba's recent accounting irregularities have highlighted issues over corporate governance in Japan, including whether the country's whistleblower law regime could do more to uncover corporate malfeasance. To address these concerns, Japan has amended its Companies Act and introduced the Corporate Governance Code to bolster the integrity of the whistleblower law regime.