Expands foreign investment screening regime
05 Jun 2026
On 5 June 2026, Japan promulgated Act No. 30 amending the Foreign Exchange and Foreign Trade Act, expanding the scope of its foreign direct investment screening regime.
The amendment extends prior notification requirements to certain indirect acquisitions, including cases in which a foreign investor acquires 50 per cent or more of the voting rights of a foreign company that has invested in a Japanese company. It also covers certain domestic investment activities undertaken under the control or influence of high-risk non-residents. For investments in non-designated sectors that are not subject to prior notification, the authorities may require reports and recommend or order the disposal of shares or other measures where risks to national security arise. The amendment also strengthens provisions concerning risk mitigation measures and requires consultation with relevant administrative agencies during the screening process.
The amendment will enter into force on a date specified by Cabinet Order within one year of its promulgation, except for certain provisions concerning inter-agency consultations, which entered into force on 5 June 2026.
Nature of measure:
Type:
-
Entry and establishment (Approval and admission - screening)
Industry:
Inward FDI:
Yes
Outward FDI:
No
Sources:
