Japan Tightens Foreign Investment Regulations to Bolster National Security

Japan's finance ministry is amending the Foreign Exchange and Foreign Trade Act to tighten reporting requirements for foreign investors. This move aims to prevent intelligence leaks to foreign governments, with stricter scrutiny on acquisitions deemed crucial to national security. The regulations likely target Chinese companies.

Japan's finance ministry is stepping up to close a loophole in reporting requirements under the Foreign Exchange and Foreign Trade Act, aiming to protect national intelligence from foreign access.

This initiative, discussed at a finance ministry panel, seeks to enhance control over economic supply chains amidst global tensions. The amendment mandates foreign investors to submit prior notifications when aiming to acquire 1% or more of firms key to Japan's security.

Although no specific country was mentioned, the focus is expected to be on Chinese companies. The new regulations, following last year's call from Japan's ruling party, could be enacted in the first half of the year after public commentary.

(With inputs from agencies.)