Regulators

Japan Financial Services Agency (FSA)

Japan FSA was established in June 1998 and is the main regulatory authority for foreign exchange margin business.

Forex Regulatory Tips

According to FSA's official website, the Financial Services Agency of Japan ("FSA") regulates leveraged foreign exchange transactions.

List of Regulated Companies

A total of 317 companies are regulated and licensed foreign exchange brokers. The full name is abbreviated as regulatory number. Regulatory status AXA INVESTMENT MANAGERS JAPAN LTD. AXA INVESTMENT MANAGERS JAPAN Kanto No.16 SBI Securities CO., LTD. SBI Securities Kanto No.44 Under supervision Japannext Co.,Ltd. Japannext Kanto No.45 Under supervision Yensai.com Co., Ltd. Yensai.com Kanto No.51 Under supervision Okasan Online Securities Co.,Ltd Okasan Online Securities Kanto No.52 Under supervision OKASAN SECURITIES CO.,LTD. OKASAN SECURITIES Kanto No.53 Under supervision au Kabucom Securities Co., Ltd. au Kabucom Securities Kanto No.61 Under supervision Credit Suisse Securities (Japan) Limited Credit Suisse Securities (Japan) Kanto No.66 Under supervision Goldman Sachs Japan Co.,Ltd. Goldman Sachs Japan Kanto No.69 under supervision JBond Totan Securities Co., Ltd. JBond Totan Securities Kanto No.79 under supervision

Organization Profile

Institutional nature
Government agencies

Organization Introduction
The Financial Services Agency is the main regulatory authority for foreign exchange margin business. Japan's financial supervision implements mixed-industry supervision, that is, the Financial Services Agency exclusively conducts comprehensive supervision of the banking industry, securities industry, insurance industry and non-financial institutions. The supervision of foreign exchange margin business institutions mainly includes regular inspections (semi-annual or year-end settlement, etc.), inspections at any time, and transaction reports provided by traders at the end of each month.
The Financial Services Agency is the highest administrative department for financial supervision in Japan. The statutory function of the Bank of Japan is to independently implement monetary policy, and it is not legally responsible for banking supervision. However, because the implementation of monetary policy requires understanding and grasping the operation status of the financial industry, Article 44 of the new "Bank of Japan Law" stipulates that the Bank of Japan has the right to sign inspection contracts with financial institutions that have business dealings in order to exercise its functions. It is checked on a contract basis. Banks of Japan can urge and guide financial institutions to effectively manage various risks in their operations through on-site and off-site inspections.
Although the division of labor between the Financial Services Agency and the Bank of Japan is different, and the focus of inspection is obviously different, banking supervision has in fact become dual supervision. In order to "perform their respective functions" and have exchanges and cooperation, Article 44, paragraph 3, of the new "Bank of Japan Act" stipulates that, at the request of the Financial Services Agency Commissioner, the Bank of Japan shall present the inspection results to the Financial Services Agency and allow the Financial Services Agency staff to view relevant material. In actual work, the staff of the Financial Services Agency and the Bank of Japan often exchange information and form a close relationship with each other. In addition, in order not to increase the burden of the inspected financial institutions, the two sides coordinate the schedule of on-site inspections of the same financial institution through a consultation mechanism.
Organization Structure
The Financial Services Agency is directly under the jurisdiction of the Cabinet Office of Japan, which was formed by the merger of the Prime Minister's Office, the Economic Planning Agency, and the Okinawa Development Agency. The Cabinet Office of Japan is responsible for Japan's economy and finance, science and technology, disaster prevention and administration, Okinawa and northern policies, symbiotic society, national life, public security, government macro policy, and the popularization system of local prefectures, prefectures, prefectures, and prefectures. .
The Minister of Finance and the Deputy Minister of Finance appointed by the Prime Minister of Japan are the top heads of the Financial Services Agency; they are directly under the leadership of the Financial Services Agency, the Securities and Exchange Commission, and the accounting firm.
The Chief Financial Officer has 4 departments:
(1) Judges: serve as administrative judges for administrative punishments;
(2) General Affairs and Planning Bureau: formulate and implement the overall planning and financial system of the Financial Services Agency;
(3) Inspection Bureau: to inspect local financial institutions;
(4) Supervision Bureau: to inspect local financial institutions.
Securities and Exchange Commission Office: Mainly responsible for reviewing the market, securities analysis, administrative investigation, public punishment, and disciplinary matters.
Accounting firm: mainly responsible for the implementation of the accountant examination, the inspection of the person in charge of supervision and other related matters, etc.
Regulatory functions
(1) Planning the financial system;
(2) To inspect and supervise market-related personnel such as banks, insurance companies, and financial commodity exchanges;
(3) Setting market transaction rules for financial products;
(4) Formulating corporate accounting standards and other debt-related matters;
(5) Supervise certified public accountants and accounting firms;
(6) To establish an international agency of financial administration with an international coordination function, and to participate in financial agreements between the two countries;
(7) Monitoring compliance with financial product market rules, etc.
Regulatory Objectives
The FSA was established to ensure the stability of Japan's financial system, protect the interests of investors such as depositors, policyholders, and securities, and promote financial facilitation.

Licence application

All persons engaged in the business of financial instruments must be registered with the Prime Minister of Japan.

Application Process
Persons applying to engage in the business of financial instruments must first submit a written application to the Prime Minister. A foreign legal person intending to engage in the business of Class I financial instruments must designate a representative in Japan (the representative must be in charge of all office or Japanese branch operations).
1. The written application should include:
(1) Trade name or name;
(2) The capital or total capital contribution of the legal person;
(3) The name of the person in charge (if it is a foreign legal person, including the representative of the Japanese office);
(4) Name of employee;
(5) Engaged in business categories;
(6) The name and address of the headquarters, and other offices;
(7) Other business types, if any;
(8) Other matters stipulated in the Cabinet Office Regulations;
2. In addition to submitting a written application, the following documents should be attached:
(1) A letter of guarantee certifying that the statement or record is true, and that it has stated or recorded significant matters, its business does not violate public interests, its personnel structure is sufficient to engage in financial instrument business, and it has certain business loss risk management capabilities;
(2) Documents stating the content and methods of business as stipulated in the Cabinet Office Regulations;
(3) Articles of Association, registration certificate, etc.;
3. If the articles of association of the company are in electronic form, the electronic version of the articles of association should be submitted;
4. The calculation method of paid-in capital stipulated in the Cabinet Office Regulations.
Reporting requirements
The fiscal year of financial instrument business operators engaged in the business of Class I financial instruments is from April 1 to March 31 of the second year. Financial instrument business operators must:
(1) To prepare and maintain accounting books and vouchers in accordance with the requirements of the Cabinet Office Decree;
(2) Prepare accounting reports for each fiscal year, and submit an accounting report to the Prime Minister within three months after the end of each fiscal year, reporting the status of its business or property. When necessary, to protect the interests of the public or investors, the Prime Minister may publish all or part of the accounting report.
(3) Preparing explanatory documents explaining business and property conditions and subject to public inspection.
(4) In accordance with the Cabinet Office Decree, establish a liability reserve for financial instrument transactions in proportion to the trading volume of transactions or other securities or derivatives transactions.
(5) Except as compensation for losses related to buying and selling or other securities or derivatives transactions and other circumstances as prescribed by the Cabinet Office Decree, the liability reserve for transactions in financial instruments shall not be misappropriated.
(6) Calculate the ratio between the total amount of declared capital, reserves and other funds to the total amount of possible risks (fluctuations in securities prices or other causes) after subtracting fixed assets and any other assets specified in the Cabinet Office Decree, that is, The capital to risk ratio is reported to the Prime Minister at the end of each month or as required by the Cabinet Office Decree.
(7) The capital to risk ratio should not be less than 120%;
(8) Financial instrument business operators may prepare capital-to-risk ratio documents as of the last day of March, June, September and December and keep them for three months for public inspection.
Financial instrument business operators engaged in non-class I financial instrument business must:
(1) To prepare and maintain accounting books and vouchers in accordance with the requirements of the Cabinet Office Decree;
(2) Prepare accounting reports for each fiscal year, and submit the accounting reports to the Prime Minister within three months after the end of each fiscal year;
(3) Prepare explanatory documents for each accounting year, explain the contents of accounting reports, and keep them for one year for public inspection.

Regulatory Inquiries

The first step: First, open the official website of FSA in Japan: http://www.fsa.go.jp/en/index.html, the picture shows the homepage of the official website of FSA in Japan (the language selected is English).

Step 2: Click on the "Regulated Institutions" item in the menu bar at the top of the page.

Step 3: Select the "Financial Instruments Business Operators" marked in the red box in the list of institution types shown in the figure below:

Step 4: We can see the "Financial Instruments Business Operators" marked by the red circle in the figure below, choose PDF or EXCEL format to open, or download.

Step 5: The PDF file page is as shown in the figure below. The file has 11 columns, showing the company's name, registration number, license number, address, contact information, and organization type.

Step 6: Use the "Ctrl F" key to search for the company information you want to know.

Regulatory complaints

Complaint
FINMAC specialises in handling inquiries and complaints related to trading in financial instruments (including equities, investment trusts and foreign exchange margin trading), resolving disputes in a fair and neutral manner.
1. Complaints and Fees
Customers can complain to FINMAC by phone, in person or by mail.
Complaint handling is a free service.
2. Complaint Resolution Process
After FINMAC receives a customer complaint, it shall start the complaint handling procedure, negotiate with the applicant and give necessary suggestions, and investigate the facts of the complaint at the same time. If mutual discussions are deemed necessary, FINMAC will notify the complained institution and urge it to resolve it as soon as possible. FINMAC will listen to the suggestion of the complained institution, notify the client of the answer, or notify the complained institution to conduct face-to-face consultation with the client, and ask the complained institution to report the results of the consultation.
3. Complaint handling time
Under normal circumstances, FINMAC will complete the complaint processing within 2 months.
Mediation
If the complainant is not satisfied with the outcome of the complaint handling, after the complaint handling is completed, he may request for mediation.
1. Mediation process
When the mediation request is accepted, the mediation process begins. Applicants must submit 3 or more written statements stating the main arguments and attach relevant supporting documents. The Dispute Resolution Mediator may ask both parties or witnesses to attend an interview. During mediation, if the parties reach an agreement and accept the mediator's solution, they must enter into a settlement agreement and submit a copy to the dispute resolution mediator, signed and stamped by the mediator.
2. Mediation fees

The applicant shall pay the mediation fee to FINMAC within 10 days from the date of receipt of the notification letter of acceptance of the mediation request. The payment method can be made by wire transfer to the bank account designated by FINMAC.
3. Mediation processing time
Generally, from the date of accepting the mediation request, the dispute resolution mediator will strive to complete the mediation process within 4 months.

Example of punishment

FAQs

For details, please click the link: https://www.fsa.go.jp/en/others/index.html
https://www.fsa.go.jp/en/laws_regulations/faq_on_fiea.pdf

Related Links

Japan Tokyo Industrial Products Exchange: http://www.tocom.or.jp
Bank of Japan: http://www.boj.or.jp/en/index.htm/
Ministry of Finance of Japan: https://www.mof.go.jp/english/index.htm
Deposit Insurance Agency: https://www.dic.go.jp/english/index.html
Prime Minister of Japan and his Cabinet: http://japan.kantei.go.jp/index.html

Contact information

Phone: 81-(0)3-3506-6000

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