Tokyo, Oct. 1 (Jiji Press)–The Japanese government plans to require corporations to submit information on their beneficial owners, including their names, addresses, dates of birth and nationalities, Jiji Press learned Thursday. The plan is being considered as part of efforts to strengthen measures against money laundering and enhance economic security, sources familiar with the matter said. The government plans to submit a bill to introduce such a reporting requirement system at an extraordinary session of the Diet, Japan’s parliament, to be convened Monday, after winning support from the ruling camp led by the Liberal Democratic Party. Money laundering schemes that exploit shell companies with no actual operations have recently become more complex and sophisticated. By increasing transparency regarding corporate ownership, the government hopes to shed light on the activities of “tokuryu” anonymous and loosely organized criminal groups. The envisaged system is also intended to gain insight into land ownership by foreign nationals. The reporting requirement would be applied to all domestic corporations with their head offices or principal offices in Japan, excluding listed companies, and certain foreign corporations, which meet any of the following conditions–conduct transactions continuously in Japan, have an office in Japan or own real estate in Japan. The target corporations would be required to submit information on beneficial owners to the Legal Affairs Bureau at the time of establishment, according to a draft of a bill to create a new law aimed at identifying such owners. In the event of noncompliance, penalties would be imposed following a written notice. Beneficial owners are defined as individuals and others who directly or indirectly hold more than 25 pct of a company’s voting rights. Information on beneficial owners would be recorded in a public register so that authorized entities, such as government agencies and financial institutions, can access the information. The Financial Action Task Force, an international body, has called on countries to establish legal frameworks for collecting beneficial owner information, while Japan remains the only member of the Group of Seven industrialized countries that has yet to introduce such a legal framework. The FATF is scheduled to conduct a review of Japan around the summer of 2028. END [Copyright The Jiji Press, Ltd.]
