Zeitschrift für Japanisches Recht
Heft Nr.13 / 7. Jahrgang 2002

New Rules for Share Structure and Governance of Japanese Corporations

Markus Janssen / Fumio Koma / Shintaro Kuroda / Peter Schimmann
Janssen & Associates Foreign Law Office, Tokyo / Komatsu,
Koma & Nishikawa Law Office, Tokyo (Registered Associated Offices)

 

I.       Shares

1.   “Par Value Shares”
2.   Classes of Shares
3.   Treasury Stock
4.   Authorised Capital
5.   Share Call Options (“Stock Options”)
6.   New “Share Units”

II.      Digitalisation of Corporate Information and Governance Processes

1.   Digitalisation of Corporate Information
2.   Digitalisation of Notices
3.   Digitalisation of the Shareholders’ Meeting

III.    General Corporate Governance

1.   Board of Directors (torishimari yakkai-kai)
2.   “Committee for Material Assets” of the Board of Directors (jûyô zaisan iinkai)
3.   Statutory Auditors (kansa yaku)
4.   Shareholders and Shareholders’ Meeting

IV.    New Optional Corporate Governance Structure

1.   Conditions for Establishment (Article 1-2 III Audit Special Exceptions Law)
2.   Governance System
3.   Committees and Members of the Committees
4.   Executive Directors

 

Recent amendments to the Japanese Commercial Code[1] and other laws, particularly the Audit Special Exceptions Law[2], have introduced major changes to the capital and share structure as well as to the governance system of Japanese corporations that will profoundly reshape the corporate environment in Japan and pave the way for a variety of new investment and governance models, which will be relevant both for domestic Japanese companies and for Japanese subsidiaries of foreign companies.

Some of the amendments became already effective, while others have been enacted and will become effective at the beginning of the next fiscal year on April 1st, 2003. Further amendments are planned.

The present overview can merely briefly introduce the major changes to the regulations pertaining to (1) shares, (2) digitalisation of information and processes and


[1]      Shôhô; all provisions mentioned in this article without express reference to a legal act refer to the Commercial Code.

[2]      Law containing special exceptions to the Commercial Code pertaining to the auditing of a joint-stock corporation (Kabushiki gaishakaisha no kansa-nadotô ni kansuru shôhô no tokubetsutokurei ni kansuru hôritsu).