Cabinet Bill 19 and Commercial Code Amendments on Beneficial Ownership Submitted

On October 23, the government submitted the Bill on the Act on the Grasping of Information Concerning the Beneficial Owners of Corporations, etc., to the Diet as Cabinet Bill No. 19. The submission and transmission to the House of Councillors were published in the “Diet Matters” section of the Official Gazette dated October 27, Reiwa 8, and are recorded respectively as “Submission of Bill” in the House of Representatives and “Receipt of Bill (Preliminary Examination)” in the House of Councillors. On the same day, the Bill on the Act on the Adjustment of Related Laws Accompanying the Enforcement of the Said Act (Cabinet Bill No. 20) and the Bill for Partial Amendment of the Commercial Code and the International Carriage of Goods by Sea Act (Cabinet Bill No. 21) were also submitted.

The Diet Matters section of the Official Gazette lists the titles and numbers of bills submitted by the Cabinet, along with the dates of submission and receipt. This publication summarizes the submissions made by the Cabinet on October 23. On the same day, the Bill for Partial Amendment of the Act on the Survey of the Status of Use of Land, etc. and the Regulation of Use in the Vicinity of Important Facilities and Border Remote Islands, etc. (Cabinet Bill No. 18) was also sent to the House of Councillors, placing the two beneficial owner-related bills and the Commercial Code amendment bill in the subsequent numbering. The descriptions in the Official Gazette are limited to the title, number, and date, and do not touch upon the framework or the articles of the bills.

Simultaneous Submission of the Beneficial Owner Bill and the Enforcement Adjustment Bill

• Cabinet Bill No. 19: Bill on the Act on the Grasping of Information Concerning the Beneficial Owners of Corporations, etc.
• Cabinet Bill No. 20: Bill on the Act on the Adjustment of Related Laws Accompanying the Enforcement of the Said Act
• Submission Date: October 23, Reiwa 8 (Submitted by the Cabinet)
• Official Gazette Publication: “Diet Matters” dated October 27, Reiwa 8

A characteristic of this submission is that the main bill and the enforcement adjustment bill were submitted as a set. It is a two-part structure that separates the new law establishing the grasping of beneficial owner information from the adjustment of existing laws and regulations necessary for its enforcement, and the numbers are organized sequentially. At the Official Gazette stage, the scope of the target corporations, the items of information to be grasped, and the procedures for declaration, publication, and updating are not indicated.

Simultaneous Submission of the Amendment Bill for the Commercial Code and the International Carriage of Goods by Sea Act

• Cabinet Bill No. 21: Bill for Partial Amendment of the Commercial Code and the International Carriage of Goods by Sea Act
• Submission Date: October 23, Reiwa 8 (Submitted by the Cabinet)
• Received by the House of Councillors as “Receipt of Bill (Preliminary Examination)”

This is a bill to amend two laws—the Commercial Code and the International Carriage of Goods by Sea Act—simultaneously, and it was submitted as a separate bill from the two beneficial owner-related bills. The Official Gazette does not list the provisions subject to amendment or the enforcement date; the contents must be awaited until the publication of the full text of the bill. Consequently, regulations regarding maritime transport involving corporate business practices and regulations regarding corporate information disclosure were sent to the Diet on the same day as separate Cabinet bills.

From Preliminary Review to Main Review, Schedule Not Yet Announced

The House of Councillors received the bills for preliminary review on October 23, and they will now proceed to review by committees and the plenary session. However, the Official Gazette does not list the committees to which they have been referred, the review schedule, or the planned dates for voting. On the House of Representatives side, it is recorded that they were treated as bills submitted by the Cabinet as of October 23.

The focus for readers lies in who will grasp the information regarding beneficial owners to what extent, and where that information will be disclosed. While these points directly impact corporate registration/disclosure practices and counterparty due diligence, the specifics cannot be determined from the Official Gazette and will be finalized through the text of the bills and the reviews by both houses. Legal and compliance officers at corporations need to track the publication of the full text of the bills and the progress of the deliberations.

Source: Official Gazette (Tuesday, October 27, Reiwa 8) “Diet Matters” — House of Representatives “Submission of Bills,” House of Councillors “Receipt of Bills (Preliminary Review),” Cabinet Bill No. 19, Cabinet Bill No. 20, Cabinet Bill No. 21.