Financial Services AgencyFSA Weekly Review No.483

March 31, 2022

What’s New on the FSA Website

Week of March 18, 2022 - March 24, 2022

This page contains the latest in events, developments, and updates to the FSA website.

Public Comments

March 24, 2022 Publication of the finalized "Cabinet Office Order to Amend the Ordinance on Audit on Specific Purpose Companies and the Ordinance on Accounting Audit of Investment Corporations" and the finalized "Cabinet Office Order to Amend the Ordinance for Enforcement of the Money Lending Business Act" after public consultation
<Summary>
The FSA published the finalized "Cabinet Office Order to Amend the Ordinance on Audit on Specific Purpose Companies and the Ordinance on Accounting Audit of Investment Corporations" and the finalized "Cabinet Office Order to Amend the Ordinance for Enforcement of the Money Lending Business Act" after public consultation. In accordance with the amendments made to the Auditing Standards on November 6, 2020, the finalized Cabinet Office Order expressly sets forth that a financial auditor shall include in the financial audit report as to:

- whether or not there are any matters to be reported regarding material differences between the contents of the business report and the contents of the financial statements (accounting documents) or between the contents of the financial statements and the knowledge obtained by the financial auditor in the course of the audit, and

- if there are any significant matters to be reported, the nature of the details thereof.  

 
In addition, in order to enable the omission of the attachment of a certificate of registered information in filing applications and/or other procedures with the FSA (while it is required under applicable laws and regulations to attach a certificate of registered information in such filing procedures), the finalized Cabinet Office Order also provides amendments to such procedures, regarding the filings that shall be additionally included in the scope of the said treatment (to be subject to omitting the attachment of the certificate of registered information) in light of the necessity of the FSA's supervision and administration.

The finalized Cabinet Office Orders alongside the "Comprehensive Guidelines for Supervision of Money Lenders, etc." were enforced on March 24, 2022, whereas certain revised provisions in regard to the "Ordinance for Enforcement of the Insurance Business Act" (prescribed in the supplementary provisions of the "Cabinet Office order to Amend the Ordinance for Enforcement of the Money Lending Business Act") were or will be enforced either on March 31 and May 1, 2022.

The original press release is available in Japanese at the following URL.
https://www.fsa.go.jp/news/r3/shouken/20220324.htmlopen new window
March 24, 2022 Publication of the finalized "Cabinet Office Order to Amend the Ordinance for Enforcement of the Banking Act, etc." after public consultation
<Summary>
The FSA published the finalized "Cabinet Office Order to Amend the Ordinance for Enforcement of the Banking Act, etc." after public consultation. The finalized Cabinet Office Order mainly requires banks, etc. to report to the FSA in the event of the occurrence or potential occurrence of any leakage, loss, or damage of personal information on retail customers. The finalized Cabinet Office Order will be enforced on April 1, 2022.

The original press release is available in Japanese at the following URL.
https://www.fsa.go.jp/news/r3/sonota/20220324/20220324.htmlopen new window
March 24, 2022 Publication of the finalized amendments to the "Guidelines for Personal Information Protection in the Financial Sector" and the "Practical Guidelines for Security Policies Regarding the Personal Information Protection in the Financial Sector" (provisional English title for the latter guidelines) after public consultation
<Summary>
The FSA and the Personal Information Protection Commission finalized the amendments to the "Guidelines for Personal Information Protection in the Financial Sector" and the "Practical Guidelines for Security Policies Regarding the Personal Information Protection in the Financial Sector" (provisional English title for the latter guidelines) after public consultation.
The amendments expressly set forth in the said Guidelines items regarding information provision of personal data to a foreign-domiciled third party in terms of security, confidentiality, and/or integrity, mandatory reporting of information leakage, and others. The amendments will take effect on April 1, 2022.

The original press release is available in Japanese at the following URL.
https://www.fsa.go.jp/news/r3/sonota/20220324-2/20220324-2.htmlopen new window
March 18, 2022 Publication of the "Cabinet Office Order Prescribing Adjustments to the Relevant and Applicable Cabinet Office Orders which are within the Purview of the Financial Services Agency to Coordinate with the Coming into Effect of the Act Partially Amending the Act on Promotion of Global Warming Countermeasures"
<Summary>
The FSA has published the "Cabinet Office Order Prescribing Adjustments to the Relevant and Applicable Cabinet Office Orders which are within the Purview of the Financial Services Agency to Coordinate with the Coming into Effect of the Act Partially Amending the Act on Promotion of Global Warming Countermeasures (Act No.54 of 2021)."
The adjustments mainly pertain to technical adjustments in accordance with the enforcement of the "Act Partially Amending the Act on Promotion of Global Warming Countermeasures" (hereinafter referred to as the "Act").
The Cabinet Office Order in tandem with the relevant and applicable Cabinet Office Orders which are within the purview of the FSA will be enforced on the date of the enforcement of the Act, April 1, 2022.

The original press release is available in Japanese at the following URL.
https://www.fsa.go.jp/news/r3/ginkou/20220318/20220318.htmlopen new window

Press Releases

International 

March 24, 2022 Amendments to the Memorandum of Cooperation with European Securities and Markets Authority

 

Councils

March 23, 2022 Publication of the agenda and handouts of the seventh meeting of the "Working Group on Corporate Disclosure" (FY 2021) of the Financial System Council
<Summary>
The FSA published the agenda and handouts of the seventh meeting of the "Working Group on Corporate Disclosure" (FY 2021) of the Financial System Council, which was held on March 24, 2022. The working group secretariat (the FSA) gave a briefing on the topic of corporate sustainability disclosures in general (mainly in terms of climate change, human resources, and employee diversity), followed by a discussion.

The original press release is available in Japanese at the following URL.
https://www.fsa.go.jp/singi/singi_kinyu/disclose_wg/siryou/20220324.html
March 18, 2022 The seventh meeting of the Working Group on Corporate Disclosure of the Financial System Council

 

Banks

March 23, 2022 Authorization granted to The Aomori Bank, Ltd. and Michinoku Bank, Ltd. to become a bank holding company by having a bank as its subsidiary
<Summary>
The FSA granted authorization to The Aomori Bank, Ltd. and Michinoku Bank, Ltd. to become a bank holding company, namely, Procrea Holdings, Inc., by having a bank as its subsidiary, pursuant to the "Banking Act."

The original press release is available in Japanese at the following URL.
https://www.fsa.go.jp/news/r3/ginkou/20220323/20220323-3.htmlopen new window
March 23, 2022 Approval of the implementation plan filed by The Aomori Bank, Ltd. and Michinoku Bank, Ltd. in regard to the application for the "fund-grant system" pursuant to the "Act on Special Measures for Strengthening Financial Functions"
<Summary>
Upon receipt of the "implementation plan" from The Aomori Bank, Ltd. and Michinoku Bank, Ltd. in regard to the application for the "fund-grant system" pursuant to the "Act on Special Measures for Strengthening Financial Functions," the FSA approved the plan after conducting a review and assessment from the perspective of the sustainability of providing core financial services to their services users.

The original press release is available in Japanese at the following URL.
https://www.fsa.go.jp/news/r3/ginkou/20220323/20220323-1.htmlopen new window　
March 23, 2022 Authorization of the plan to maintain essential services for local residents in municipalities, filed by The Aomori Bank, Ltd. and Michinoku Bank, Ltd.
<Summary>
The FSA authorized the plan to maintain essential services for local residents in municipalities, filed by The Aomori Bank, Ltd. and Michinoku Bank, Ltd., pursuant to the "Act on Special Provisions of the Act on Prohibition of Private Monopolization and Maintenance of Fair Trade to Maintain Essential Services for Local Residents in Municipalities in Regard to General Passenger Ride-Sharing Motor Carrier Services and Banking Business"* (provisional English law title).
 

* The Act is under the joint jurisdiction of the Cabinet Secretariat, the FSA, and the Ministry of Land, Infrastructure, Transport and Tourism (MLIT). The Act exempts certain cases of business enhancement through mergers and/or joint management among motor carrier service providers, regional banks or others in municipalities that may conflict with the "Act on Prohibition of Private Monopolization and Maintenance of Fair Trade." Some services provided by ride-sharing motor carrier service providers and regional banks in the respective municipalities are regarded as "essential services." These essential services are the basis for the lives and economic activities of local residents and are also difficult to be replaced by other operators/providers. The existing service providers and regional banks are facing difficulties in providing "essential services" in a sustainable manner due to reasons such as declining population.


The original press release is available in Japanese at the following URL.
https://www.fsa.go.jp/news/r3/ginkou/20220323/20220323-2.htmlopen new window
March 23, 2022 Approval of the implementation plan filed by The Aomori Bank, Ltd. and Michinoku Bank, Ltd. in regard to the application for the "fund-grant system" pursuant to the "Act on Special Measures for Strengthening Financial Functions"
<Summary>
Upon receipt of the "implementation plan" from The Aomori Bank, Ltd. and Michinoku Bank, Ltd. in regard to the application for the "fund-grant system" pursuant to the "Act on Special Measures for Strengthening Financial Functions," the FSA approved the plan after conducting a review and assessment from the perspective of the sustainability of providing core financial services to their services users.

The original press release is available in Japanese at the following URL.
https://www.fsa.go.jp/news/r3/ginkou/20220323/20220323-1.htmlopen new window
March 23, 2022 Approval of the Revised Business Strengthening Plan filed by Michinoku Bank, Ltd.
<Summary>
The FSA approved the Revised Business Strengthening Plan filed by Michinoku Bank, Ltd., which reflects its management integration with The Aomori Bank, Ltd., pursuant to the "Act on Special Measures for Strengthening Financial Functions."

The original press release is available in Japanese at the following URL.
https://www.fsa.go.jp/news/r3/ginkou/20220323/20220323-4.htmlopen new window
March 23, 2022 Publication of the outlines of proceedings of the 28th meeting of the Examination Board on Strengthening of Financial Functions
<Summary>
The FSA published the outlines of proceedings of the 28th meeting of the Examination Board on Strengthening of Financial Functions pursuant to Article 8 of the Operational Rules for the Board.

The original press release is available in Japanese at the following URL.
https://www.fsa.go.jp/singi/soff/gijiyoshi/20220304.htmlopen new window

 

Others

March 24, 2022 Publication of the updated "FAQs Regarding Protection of Personal Information by Financial Institutions" alongside the updated "Comprehensive Guidelines for Supervision of Major Banks, etc." and other relevant and applicable guidelines
<Summary>
In accordance with the amendments to the "Act on the Protection of Personal Information" and others which are scheduled to be enforced on April 1, 2022, the FSA updated the "FAQs regarding Protection of Personal Information by Financial Institutions" alongside "Comprehensive Guidelines for Supervision of Major Banks, etc." and other relevant and applicable comprehensive guidelines for supervision of other financial institutions as well as "Guidelines for Administrative Processes." The said guidelines and so forth will be enforced on April 1, 2022.

The original press release is available in Japanese at the following URL.
https://www.fsa.go.jp/common/law/kj-hogo-2/index.htmlopen new window
https://www.fsa.go.jp/news/r3/sonota/20220324-3/20220324-3.htmlopen new window
March 23, 2022 Press Release on the "Development of a New High-precision AI-based Translation Engine Specialized for the Financial Sector"
March 23, 2022 Warning against so-called cash-in-advance purchase service scheme involving hefty cancellation fees          
<Summary>
Consumer damages have recently been ascertained in regard to the so-called cash-in-advance purchase service scheme under the guise of a purchase and sale of goods, in which the service provider offers cash to a service user as an advance payment for the purchase of goods, on the premise that the contract is cancelled, thereby charging the service user with hefty cancellation fees.
While the transaction is under the guise of a purchase and sale of goods, in actuality, the economic reality of the transaction can be considered a loan, involving a risk that a service user can end up in debt by paying hefty cancellation fees.
In this regard, in order to alert the general public, the FSA published a leaflet on its website warning against the potential risk using the said services.

The original press release is available in Japanese at the following URL.
https://www.fsa.go.jp/ordinary/chuui/cashing_chuui2.htmlopen new window
March 22, 2022 Publication of the main issues raised by the FSA at opinion exchange meetings with the relevant associations in the financial sector
<Summary>
The FSA has published the main issues raised by the FSA at opinion exchange meetings* held with the relevant associations in the financial sector in February 2022. (Available only in Japanese).
Common topics across the groups were "sustainable finance initiatives" and "measures for AML/CFT [Anti-Money Laundering and Combating the Financing of Terrorism]."
Other notable issues discussed by most but not all groups were, "termination of transitional measures for the transition to the FSA Electronic Application and Notification System," and "promotion of registration of human resources (who have extensive managerial and practical experience and expertise at major private corporations) with REVICareer (a human resources database of REVIC [Regional Economy Vitalization Corporation of Japan] to encourage matching of human resources to support the management of regional businesses)."
 

* To enhance the transparency of its administration and to share its awareness of issues in the financial sector in a timely manner, the FSA publishes every month the main issues raised by the FSA at opinion exchange meetings with the relevant associations** in the financial sector. Opinion exchange meetings are held with the respective associations on a regular basis.

** In February 2022, opinion exchange meetings were held respectively with eight groups: major banks, etc.; the Regional Banks Association of Japan and the Second Association of Regional Banks; Community Bank Shinyo Kumiai; the Life Insurance Association of Japan; the General Insurance Association of Japan; the Japan Securities Dealers Association; the Japan Investment Advisers Association; and Labor banks, etc.


The original press release is available in Japanese at the following URL.
https://www.fsa.go.jp/common/ronten/index.htmlopen new window
March 22, 2022 New series of articles contributed to "Bank Business" (a monthly magazine published by Kindai-Sales Co., Ltd.) in regard to financial and economic education (financial literacy), to be publicized on the FSA's web portal    
<Summary>
The FSA will be contributing to a new series of articles in "Bank Business" (a monthly magazine published by Kindai-Sales Co., Ltd.) mainly in regard to financial and economic education (financial literacy). The contents of the series will also be publicized on the FSA's web portalopen new window,* with the aim of providing a greater number of people with information about financial literacy and financial and economic education initiatives.
*PDFThe first installment in the series is available (only in Japanese) on the web portal. 

The original press release is available in Japanese at the following URL.
https://www.fsa.go.jp/news/r3/sonota/20220322-2/20220322-2.htmlopen new window

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