Capital Markets: Derivatives 2024

Last Updated September 03, 2024

Japan

Law and Practice

Authors

Daisuke Tanimoto
Etsuko Yamazaki
Miki Okuda

Anderson Mori & Tomotsune has a well-established derivatives practice and is adept at responding to the complex issues surrounding sophisticated derivatives transactions. Its expert lawyers regularly provide services for the negotiation and drafting of ISDA documents and other derivative contracts. They also provide support on a broad range of regulatory compliance issues regarding over-the-counter derivatives transactions including variation and initial margin requirements. They provide advice on all major categories of derivative, such as currency, interest rate, equity, credit and commodity derivatives. They also advise on earthquake, energy, carbon credit and crypto-asset derivatives, as well as structured finance transactions involving hybrid instruments such as structured deposits, synthetic collateralised debt obligations, credit-linked notes, credit-linked loans and repackaged notes. In addition, they advise on cross-border transactions with multi-jurisdictional elements and conduct research on foreign laws and regulations by working closely with leading overseas law firms.

The regulation of derivatives under Japanese law is divided into two major pieces of legislation, namely, the Financial Instruments and Exchange Act (Act No. 25 of 1948, as amended, “FIEA”) and the Commodities Futures and Exchange Act (Act No. 239 of 1950, as amended, “CFEA”).

The FIEA regulates over-the-counter (OTC) derivatives transactions falling under the definition of OTC Financial Derivatives Transactions, which include OTC derivatives referencing financial instruments such as interest rates, FX, equity, credit, electronic payment instruments or crypto-assets. The concept of OTC Financial Derivatives Transactions is further divided into the following three categories: (i) securities-related OTC Financial Derivatives Transactions (ie, OTC Financial Derivatives Transactions which refer to securities); (ii) non-securities-related OTC Financial Derivatives Transactions (ie, OTC Financial Derivatives Transactions which do not refer to securities) which do not reference crypto-assets etc; and (iii) non-securities-related OTC Financial Derivatives Transactions which refer to crypto-assets etc. As a result of an amendment to the FIEA in 2022, the term “crypto-assets etc” is defined to include not only crypto-assets but also certain electronic payment instruments defined under the Payment Services Act (which essentially means stablecoins). The scope of electronic payment instruments included in the definition of “crypto-assets etc” is to be designated by the Financial Services Agency of Japan (“JFSA”), but such designation has not yet been made.

Separately from the FIEA, the CFEA regulates OTC derivatives transactions falling under the definition of OTC Commodity Derivatives Transactions, which include OTC derivatives transactions referencing commodities such as oil, gas, electricity, precious metals and agricultural products.

OTC derivatives referencing underlying instruments which are related to neither financial instruments nor commodities will not trigger the licensing/registration requirement under the FIEA or the CFEA.

Exchange-traded derivatives referencing financial instruments and commodities are also regulated under the FIEA and CFEA.

As a result of an amendment to the Foreign Exchange and Foreign Trade Act (Act No. 228 of 1949, as amended) which came into force in 1980, Japanese parties are now able to enter into cross-border transactions without having to obtain any prior consents/approvals from the Japanese authorities under this Act. This event has had a significant impact on the development of the derivatives market in Japan.

In 1998, the Act on Close-Out Netting of Specified Financial Transactions Conducted by Financial Institutions (Act No. 108 of 1998, as amended) was enacted, and the validity and enforceability of the close-out netting arrangement concerning certain OTC derivatives has been expressly confirmed by legislation. Further, as a result of amendments to insolvency laws (eg, Article 58 of the Bankruptcy Act), protection of the close-out netting arrangement has been expanded to cover a broader scope of derivatives. The legal certainty brought about by netting legislation has underpinned the growth of the derivatives market in Japan.

The development of the regulatory framework governing derivatives transactions has also influenced the way the derivatives markets have evolved. Before the Securities and Exchange Act was renamed as the Financial Instruments and Exchange Act by the amendments of 2006 (effective as of 2007), derivatives transactions were regulated as follows:

  • securities-related derivatives were regulated under the Securities and Exchange Act;
  • financial futures and options listed on the financial futures exchange were regulated under the Financial Futures Trading Act (Act No. 77 of 1988, as amended);
  • commodities futures and options listed on the commodity futures exchange were regulated under the Commodity Exchange Act (Act No. 239 of 1950, as amended); and
  • OTC derivatives referencing interest rates, FX or certain other financial instruments were not directly regulated by any specific legislation.

The Securities and Exchange Act and the Financial Futures Trading Act were merged into the FIEA, and the regulation of OTC Financial Derivatives Transactions was integrated under the FIEA.

Following the global financial crisis in 2008, the G20-initiated OTC derivative regulatory reforms (ie, mandatory clearing, mandatory trade execution, a trade data reporting requirement and a margin requirement for uncleared derivatives) were implemented under the FIEA.

As a result of an amendment to the CFEA in 2014, derivatives referencing electricity became regulated. In addition, as a result of an amendment to the FIEA in 2019, derivatives referencing crypto-assets became regulated. As described in 1.1 Overview of Derivatives Markets, the amendment to the FIEA in 2022 defined the term “crypto-assets etc” to include not only crypto-assets but also a certain type of electronic payment instrument and as a result derivatives referencing “crypto-assets etc” became regulated as such. Derivatives referencing other types of electronic payment instruments also fall under the scope of derivatives regulated under the FIEA.

As regards the most recent developments in this area, the following amendments to the trade data reporting requirement came into force in April 2024:

  • Although reporting dealers were previously allowed to report trade data to either the JFSA (ie, direct reporting) or the designated trade repository (ie, indirect reporting), they are now obligated to submit trade data to the trade repository, unless there is a natural disaster or any other due reason why they cannot report to the trade repository (in such a case, reporting dealers may submit trade data to the JFSA).
  • For the purpose of implementing the data requirements specified by CPMI-IOSCO’s CDE Technical Guidance, the use of an LEI (legal entity identifier), a UTI (unique transaction identifier) and improved CDE (critical data elements) is now required.

The risk of rising interest rates in the future is having a major impact on the derivatives market. Specifically, the balance of outstanding JPY interest rate swap transactions cleared by the Japan Securities Clearing Corporation (“JSCC”) has reached record levels.

Futures and options are listed on regulated markets operated by the following four Japanese exchanges:

  • Osaka Exchange, Inc. (OSE) (for both financial instruments and commodities derivatives);
  • Tokyo Financial Exchange Inc. (TFX) (for financial instruments derivatives);
  • Tokyo Commodity Exchange, Inc. (TOCOM) (for commodities derivatives); and
  • Osaka Dojima Exchange, Inc. (ODEX) (for commodities derivatives).

No futures or options referencing crypto-assets are currently listed in Japan.

On 11 October 2023, the Tokyo Stock Exchange (TSE) established a carbon credit market for J-Credits. On this carbon credit market, carbon dioxide equivalent quotas and other similar products are traded. Emission allowance derivatives have generally been considered to not relate to either financial instruments or commodities. However, the legal status of carbon credits and how to regulate them is still under discussion, and therefore it is necessary to closely watch the JFSA’s announcements in the future.

It is usual to conclude an ISDA Master Agreement for swap transactions. Voice trading is generally more common than electronic trading.

Swaps referencing financial instruments (including securities) are regulated as OTC Financial Derivatives Transactions under the FIEA, whereas swaps referencing commodities are regulated as OTC Commodity Derivatives Transactions under the CFEA.

Swaps cleared by the JSCC are subject to the JSCC’s clearing rules. Uncleared swaps are subject to margin requirements, as we describe in 4.1.2 Margins.

Although cash-settled forward transactions are regulated as OTC Financial Derivatives Transactions or OTC Commodity Derivatives Transactions (depending on the underlying assets), spot or forward transactions which are settled only physically are considered as sales and purchases of underlying assets, which do not fall under the definition of OTC Financial Derivatives Transactions or OTC Commodity Derivatives Transactions.

OTC Derivatives

(1) Type I FIBO registration requirement under the FIEA

Engaging in the business of acting as a principal, intermediary, broker or agent in OTC Financial Derivatives Transactions falls under the definition of a Type I Financial Instruments Business. Under the FIEA, a person who conducts a Financial Instruments Business must be registered with the JFSA as a Type I Financial Instruments Business Operator (“Type I FIBO”).

(2) Regulation of Foreign Securities Dealer under the FIEA

A Foreign Securities Dealer is defined as an entity which (i) engages in a business involving securities-related transactions in accordance with the law of a foreign jurisdiction, and (ii) is not registered as a Financial Instruments Business Operator (“FIBO”) or licensed as a Financial Institution in Japan. A Foreign Securities Dealer is generally prohibited from acting as a principal, intermediary, broker or agent in securities-related transactions with an end user in Japan, including securities-related OTC Financial Derivatives Transactions.

(3) Commodity Derivatives Business Operator licensing requirement under the CFEA

A person is considered to engage in the business of OTC Commodity Derivatives Transactions if such person acts as a principal, intermediary, broker or agent in such transactions as a business. Under the CFEA, depending on the type of commodities, a person who engages in such business must be licensed by the Ministry of Economy, Trade and Industry (“METI”) and/or the Ministry of Agriculture, Forestry and Fishery (“MAFF”) as a Commodity Derivatives Business Operator.

Exchange-Traded Derivatives

Type I or Type II FIBO registration requirement under the FIEA

A person who engages in the business of exchange-traded derivatives (“ETDs”) in Japan must be registered (i) as a Type I FIBO if the underlying instruments of such ETDs are certain highly liquid securities (eg, government bonds, municipal bonds, corporate bonds, corporate shares, share option certificates, units in investment trusts, commercial papers, mortgage securities, depositary receipts and negotiable deposit certificates) or if such ETDs are commodities futures listed on a financial instruments exchange licensed in Japan or (ii) as a Type II FIBO if such ETDs do not fall under the scope of (i) above.

Regulation of Foreign Securities Dealer under the FIEA

A Foreign Securities Dealer is generally prohibited from acting as a principal, intermediary, broker or agent in securities-related transactions with an end user in Japan, including securities-related ETDs.

In addition, a Foreign Securities Dealer is permitted to trade ETDs listed on a financial instruments exchange licensed in Japan without being registered as an FIBO if it has obtained permission from the JFSA.

Commodity Derivatives Business Operator licensing requirement under the CFEA

Under the CFEA, a person who engages in the business of acting as an intermediary, broker or agent in commodities ETDs listed on a commodities exchange licensed in Japan or on a commodities exchange outside Japan must be licensed as a Commodity Derivatives Business Operator. As distinct from OTC Commodity Derivatives Transactions discussed in (3) above regarding OTC derivatives, entering into commodities ETDs as a principal does not trigger this licensing requirement.

The JFSA published the aggregated notional amounts of OTC derivatives reported to it as of March 2023. According to such published material, the underlying financial instruments of OTC derivatives predominantly traded in Japan are as follows in descending order on the basis of the aggregate notional amounts:

  • interest rates (96.7%):
  • FX (2.0%);
  • credit (0.8%); and
  • equity (0.5%).

In addition, commodity, electricity, earthquake and weather derivatives have been traded in Japan. As new asset classes, OTC crypto-asset derivatives have recently been emerging in Japan.

OTC derivatives referencing new asset classes may be caught by the prohibition of gambling under the Criminal Code (Act No. 45 of 1907, as amended). Gambling means any provision or receipt of money or other economic value on a contingency basis. This definition is sufficiently broad to include virtually all derivatives transactions, including OTC Financial Derivatives Transactions and OTC Commodity Derivatives Transactions. Gambling is a criminal offence unless it is authorised by law or there is a legitimate reason. For a detailed description of the situations where OTC derivatives transactions are authorised by law, please see below.

(i) FIEA Provisions

Any off-market act aimed at providing and/or receiving a monetary difference based on quotations or indices of stock exchanges or financial futures exchanges in Japan is illegal, unless it is an OTC Financial Derivatives Transaction to which an FIBO or Registered Financial Institution is a party, or an FIBO or Registered Financial Institution acts as an intermediary, broker or agent.

(ii) CFEA Provisions

The CFEA prohibits any off-market act aimed at providing and/or receiving a monetary difference based on quotations of domestic commodities exchanges, unless a licensed Commodity Derivatives Business Operator or a Specified OTC Commodity Derivatives Transactions Dealer that has made a notification to the MAFF or the METI is a party thereto. If a licensed Commodity Derivatives Business Operator or a notified Specified OTC Commodity Derivatives Transactions Dealer is a party, dealing in the relevant OTC Commodity Derivatives Transaction will be considered as legal for the purpose of the Criminal Code.

(iii) Other Acts

The Banking Act (Act No. 59 of 1981, as amended) and other legislation regulating Financial Institutions licensed in Japan provide that certain types of OTC derivatives transactions are included in the legitimate business of such Financial Institutions. OTC derivatives transactions that are entered into by such Financial Institutions pursuant to those statutes should also be considered as not being contrary to the Criminal Code.

If an OTC Financial Derivatives Transaction, an OTC Commodity Derivatives Transaction or any other derivatives transaction is not authorised by law and there is no legitimate reason for it, there is a theoretical risk that it could be deemed as a form of gambling.

Exemptions for Transactions With Eligible Investors

1. OTC derivatives

Exemptions from the registration requirement under the FIEA or the licensing requirement under the CFEA are available, in cases where counterparties to OTC derivatives are limited to certain eligible investors. The scope of such eligible investors is different depending on the types of underlying assets (ie, securities, crypto-assets, other financial instruments and commodities) to which the relevant OTC derivatives refer.

(1) Exemption from the Type I FIBO registration requirement under the FIEA

As an exemption from the Type I FIBO registration requirement, the FIEA provides that for non-securities-related OTC Financial Derivatives Transactions that are not Specified OTC Financial Derivatives Transactions (as defined in 3.1.3 Mandatory Trading) and do not refer to crypto-assets etc, a person will not be considered to be conducting a Financial Instruments Business by acting as a principal, intermediary, broker or agent in such transactions where the counterparties thereto are limited to the following entities (“Eligible Financial Derivatives Investors”):

(i) Type I FIBOs;

(ii) Registered Financial Institutions;

(iii) qualified institutional investors (QIIs);

(iv) stock corporations (kabushiki kaisha) with a paid-up capital of JPY1 billion or more; and

(v) overseas persons equivalent to (i) to (iv) above.

In addition, a person conducting the business of OTC Financial Derivatives Transactions referencing crypto-assets etc solely outside Japan pursuant to the laws of the foreign jurisdiction will not be deemed to be conducting a Financial Instruments Business by entering into such transactions from outside Japan where the counterparties are limited to the following entities:

(i) the government of Japan or the Bank of Japan;

(ii) FIBOs and Financial Institutions that engage in OTC Financial Derivatives Transactions referencing crypto-assets etc in the course of business;

(iii) Financial Institutions, trust companies or foreign trust companies (only if they conduct OTC Financial Derivatives Transactions referencing crypto-assets etc for the purpose of investments or on the account of trustors under trust agreements); and

(iv) FIBOs that engage in investment management business (only if such entities conduct any act related to investment management business).

(2) Exemption from the regulation of Foreign Securities Dealer under the FIEA

As mentioned in 2.4 Listed v Over-the-Counter, a Foreign Securities Dealer is generally prohibited from acting as a principal, intermediary, broker or agent in securities-related OTC Financial Derivatives Transactions with an end user located in Japan. This general prohibition does not apply where the securities-related OTC Financial Derivatives Transactions are effected from outside of Japan:

(i) with FIBOs conducting securities-related businesses, government organisations, the Bank of Japan, FIBOs engaging in an investment management business and acting on behalf of their clients in the course of such business, banks, trust banks, insurance companies, co-operative banks, federations of co-operative banks, labour credit associations, federations of labour credit associations, The Norinchukin Bank, The Shoko Chukin Bank, credit associations, federations of credit associations (for their own investment purposes or for the account of a settlor (entrustor) pursuant to a trust agreement);

(ii) with an Eligible Financial Derivatives Investor in Japan pursuant to an order of such investor without any solicitation on the part of the Foreign Securities Dealer; or

(iii) with an Eligible Financial Derivatives Investor in Japan through a Type I FIBO acting as intermediary, broker or agent without any solicitation on the part of the Foreign Securities Dealer.

According to X-1-2 of the JFSA’s “Comprehensive Guidelines for Supervision of Financial Instruments Business Operators, etc.”, the posting by a Foreign Securities Dealer of advertisements regarding activities concerning securities-related businesses on its websites will, in principle, be deemed to constitute a solicitation. However, it may not be deemed to constitute a solicitation aimed at investors in Japan if reasonable measures (as illustrated below) are taken to prevent such advertisement from resulting in activities concerning securities-related business with investors in Japan as their transaction counterparties:

  • Disclaimer: A disclaimer to the effect that the advertised service is not targeted at investors in Japan must be indicated.
  • Measures to prevent transactions: Measures to prevent transactions with investors in Japan regarding activities concerning securities-related businesses must be put in place.

(3) Exemption from the Commodity Derivatives Business Operator licensing requirement under the CFEA

As an exemption from the licensing requirement as a Commodity Derivatives Business Operator, the CFEA provides that for OTC Commodity Derivatives Transactions, a person will not be considered to be engaging in the business of OTC Commodity Derivatives Transactions by acting as a principal, intermediary, broker or agent in such transactions where the counterparties to such transactions are limited to the following entities (“Eligible Commodity Derivatives Investors”):

(i) Commodity Derivatives Business Operators;

(ii) Commodity Investment Advisors;

(iii) qualified institutional investors (QIIs);

(iv) Type I FIBOs;

(v) Registered Financial Institutions;

(vi) stock corporations with a paid-up capital of JPY1 billion or more;

(vii) overseas persons equivalent to (i) to (vi) above;

(viii) special purpose companies (tokutei mokuteki kaisha) established under the Act on the Securitisation of Assets (Act No. 105 of 1998, as amended) (a) whose specified share capital is JPY1 billion or more or (b) whose specified share capital of JPY30 million or more and whose asset-backed securities are held by eligible investors only; and

(ix) subsidiaries of any of the foregoing entities.

OTC Commodity Derivatives Transactions with Eligible Commodity Derivatives Investors are referred to as “Excluded OTC Commodity Derivatives Transactions”. Under Article 349 of the CFEA, a person who engages in the business of Excluded OTC Commodity Derivatives Transactions is required to file a prior notification as a Specified OTC Commodity Derivatives Transaction Dealer if the underlying assets of such transactions are related to commodities or commodity indices which are designated by the relevant authority (currently, commodities and commodity indices referred to by exchange-traded commodities derivatives listed on commodities exchanges licensed in Japan are designated).

2. Exchange-traded derivatives

(1) Exemption from the FIBO registration requirement under the FIEA

The exemption from the registration requirement under the FIEA in cases where the counterparties are limited to certain sophisticated investors (see 1(1) above) is not available for ETDs listed on a financial instruments exchange licensed in Japan.

(2) Exemption from the regulation of Foreign Securities Dealer under the FIEA

A Foreign Securities Dealer is permitted to trade ETDs listed on a financial instruments exchange licensed in Japan without being registered as an FIBO, if it has obtained permission from the JFSA.

In the case of securities-related ETDs listed on a foreign financial instruments exchange, a Foreign Securities Dealer is permitted to engage in such ETDs for Japanese customers under the regulatory framework for a Foreign Securities Dealer as described in 1(2) above. Further, in the case of non-securities-related ETDs listed on a foreign financial instruments exchange, a foreign dealer is permitted to engage in such ETDs for Japanese customers under a regulatory framework similar to the regulatory framework for a Foreign Securities Dealer as described in 1(2) above.

(3) Exemption from the Commodity Derivatives Business Operator licensing requirement under the CFEA

As distinct from OTC Commodity Derivatives Transactions discussed in 1(3) above, entering into commodity ETDs as a principal does not trigger this licensing requirement. Further, a person who engages in the business of commodity ETDs listed on a foreign commodity exchange by acting as an intermediary, broker or agent in such foreign commodity ETDs need not be licensed as a Commodity Derivatives Business Operator, if customers or counterparties in Japan are limited to Eligible Commodity Derivatives Investors.

Non-derivative Products Including Spot Transactions

Regarding the definitions of the terms “OTC Financial Derivatives Transactions” and “OTC Commodity Derivatives Transactions”, the following types of transactions are considered neither as OTC Financial Derivatives Transactions nor as OTC Commodity Derivatives Transactions:

  • forward foreign exchange transactions (ie, physically-settled FX spot transactions, FX forward transactions and physically-settled FX swap transactions); and
  • derivatives transactions whose underlying asset is neither financial instruments nor commodities (eg, certain emissions allowances or freight).

In addition, physically-settled securities forward transactions are generally not regulated as OTC Financial Derivatives Transactions but are regulated as sales and purchases of securities under the FIEA.

Physically-settled FX spot/forward transactions are generally entered into as sale and purchase transactions of currencies. However, since foreign exchange margin transactions are rolled over, such FX transactions are regulated as OTC Financial Derivatives Transactions. Therefore, under the FIEA, a person who provides such FX transactions must be registered with the JFSA as a Type I FIBO. For more information about the regulation applicable to a provider of FX transactions (eg, for retail investors), please see 3.1.6 Business Conduct.

OTC Financial Derivatives Transactions are regulated by the JFSA pursuant to the FIEA, whereas OTC Commodity Derivatives Transactions are regulated by the METI and the MAFF pursuant to the CFEA.

OTC Derivatives Subject to Mandatory Clearing Requirements

The following categories of OTC Financial Derivatives Transactions for which the JSCC offers clearing services are subject to the mandatory clearing requirement under the FIEA:

  • credit derivatives transactions which refer to an index of iTraxx Japan (“Designated Cleared CDSs”); and
  • interest rate swap transactions which refer to (i) TONA compounded in arrears, (ii) the three-month Euroyen TIBOR (with a contract term of 1,839 days or less) or (iii) six-month Euroyen TIBOR (with a contract term of 3,666 days or less) (“Designated Cleared IRSs”, and together with Designated Cleared CDSs, “Designated Cleared Transactions”).

Where the mandatory clearing requirement applies, parties must clear Designated Cleared Transactions through central counterparty clearing houses (CCPs) (including overseas CCPs) licensed in Japan.

Exemptions From Mandatory Clearing Requirements

Designated Cleared CDSs are exempt from the mandatory clearing requirement where:

  • one counterparty to the transaction is not an FIBO or a Registered Financial Institution (“FIBO etc”);
  • the transaction is entered into by a trustee on behalf of the trust;
  • the transaction is entered into by and between entities which belong to the same corporate group; or
  • either (or both) of the counterparties to the transaction is an entity which is not a clearing member and whose parent companies or subsidiaries are not clearing members (limited to cases where there is a reasonable reason why none have or will become clearing members).

Designated Cleared IRSs are exempt from the mandatory clearing requirement where:

  • one counterparty to the transaction is not an FIBO etc;
  • the transactions are entered into by a trustee on behalf of the trust (excluding cases where the average aggregate notional amount of certain OTC derivatives of the trust is not less than JPY300 billion);
  • the transactions are entered into by and between entities which belong to the same corporate group; or
  • either (or both) of the counterparties to the transactions is an FIBO etc that meets either of the following criteria:
    1. it is (x) an FIBO which is not a Type I FIBO or (y) a Registered Financial Institution that is neither a bank, The Shoko Chukin Bank, Development Bank of Japan Inc., Shinkin Central Bank, The Norinchukin Bank nor an insurance company; or
    2. it is an FIBO etc whose average aggregate notional amount of certain OTC derivatives is less than JPY300 billion.

OTC Derivatives Subject to Mandatory Trade Execution Requirements

Mandatory trade execution requirements under the FIEA apply to Specified OTC Financial Derivatives Transactions, which are defined as JPY interest rate swap transactions involving the exchange of a floating rate and a fixed rate meeting the following conditions:

  • the floating rate is TONA compounded in arrears;
  • the notional amount remains unchanged during the term of the transaction;
  • the effective date of the transaction is two business days after the trade date;
  • the term of the transaction is either five, seven or ten years;
  • as a business day convention, if a date designated by the parties is not a business day, that date will be taken to be the first following day that is a business day unless that day falls in the next calendar month, in which case the date will be taken to be the first preceding day that is a business day;
  • the fixed rate is paid once every year and is calculated based on the actual number of days divided by 365;
  • the floating rate is paid once every year and is calculated based on the actual number of days divided by 365; and
  • the JSCC offers clearing services for the transaction.

Specified OTC Financial Derivatives Transactions must be executed using an electronic trading platform (ETP) operated by an FIBO etc or by a foreign ETP operator which has obtained a licence in Japan.

Exemptions From Mandatory Trade Execution Requirements

Specified OTC Financial Derivatives Transactions are exempt from the mandatory trade execution requirement where:

  • the transactions are entered into by a trustee on behalf of the trust;
  • the transactions are entered into by and between entities which belong to the same corporate group;
  • either (or both) of the counterparties to the transactions is an FIBO etc which meets either of the following criteria:
    1. it is (x) an FIBO which is not a Type I FIBO or (y) a Registered Financial Institution that is neither a bank, The Shoko Chukin Bank, Development Bank of Japan Inc., Shinkin Central Bank nor The Norinchukin Bank; or
    2. it is an FIBO etc whose average aggregate notional amount of certain OTC derivatives as of each month-end during the last one-year period is less than JPY6 trillion.

Neither the FIEA nor the CFEA imposes any statutory position limit on the trading of derivatives, but registered FIBOs or licensed Commodity Derivatives Business Operators would impose a position limit on their customers for the purpose of their credit risk management. For ETDs, a position limit may be imposed by the relevant financial exchange.

For completeness, under the Banking Act, banks licensed in Japan are subject to large exposure rules which set forth the upper limit on the total credit risk exposure (including derivatives exposure) for each counterparty. In addition, a loss cut rule must be established for certain retail derivatives, as we describe in 3.1.6 Business Conduct.

OTC Derivatives Subject to Trade Data Reporting Requirement

A trade data reporting requirement applies to the following OTC Financial Derivatives Transactions:

  • forward transactions (except those settled within two business days);
  • index forward transactions (except those settled within two business days);
  • option transactions (except those whose exercise period is within two business days);
  • index option transactions (except those whose exercise period is within two business days);
  • swap transactions; and
  • credit derivatives transactions.

The trade data reporting requirement applies to FIBOs etc (limited to (i) a Type I FIBO and (ii) a Registered Financial Institution that is a bank, The Shoko Chukin Bank, Development Bank of Japan Inc., Shinkin Central Bank, The Norinchukin Bank or an insurance company (any such entity in (i) and (ii), a “Reporting Dealer”)). Reporting Dealers must report the trade data to a trade repository designated by the JFSA, unless there is a natural disaster or any other due reason why the Reporting Dealers cannot report to the trade repository (in such case, Reporting Dealers may report the trade data to the JFSA).

Exemptions From Trade Data Reporting Requirements

If either or both of the counterparties to uncleared OTC Financial Derivatives Transactions are any of the following entities, the reporting requirements do not apply:

  • national government;
  • local public entities;
  • Bank of Japan;
  • foreign governments, local public entities and central banks;
  • international organisations designated by the Commissioner of the JFSA; or
  • an entity which belongs to the same corporate group as the other counterparty which is an FIBO etc.

In addition, if one party is a Reporting Dealer, the other party that is not a Reporting Dealer will be exempt from the reporting requirement.

Furthermore, if a Reporting Dealer of which its average aggregate notional amount of certain OTC derivatives is less than JPY300 billion has filed a notification to the JFSA and the designated trade repository, such Reporting Dealer is exempt from the reporting requirement on OTC Financial Derivatives Transactions other than those that refer to an interest rate, debt securities or FX.

Specific Requirements for Business Operators Handling Derivatives

Leverage restrictions

FIBOs and Commodity Derivatives Business Operators are subject to leverage restrictions when entering into certain derivatives with customers who are individuals. For example, for the leverage restriction on certain FX transactions with individuals under the FIEA, the maximum notional amount is 25 times the amount of the margin posted by each customer. For the leverage restriction on retail crypto-asset derivatives with individuals under the FIEA, the maximum notional amount is double the amount of the margin posted by each customer. For the leverage restriction on retail commodity derivatives with individuals, the maximum notional amount is 20 times the amount of the margin posted by each customer.

Loss cut rule

The FIEA provides that a Type I FIBO is required to establish a loss cut rule with respect to certain FX transactions offered to individual customers and with respect to OTC crypto-asset derivatives transactions (ie, if the loss incurred by a customer exceeds a certain level, the position of the customer must be compulsorily closed). The CFEA also provides that a Commodity Derivatives Business Operator is required to establish a loss cut rule.

Prohibition of solicitation without consent

The FIEA and CFEA prohibit visiting or making a phone call to a customer who has not consented to solicitation. Further, if a Type I FIBO engages in OTC crypto-asset derivatives, the following acts are also prohibited:

  • entering into a crypto-asset-related agreement with or soliciting such, or advertising financial instruments transactions related to crypto-assets to customers without showing reasonable supporting evidence of certain prescribed facts; and
  • soliciting the entering into of a crypto-asset-related agreement without representing certain matters to customers clearly and correctly.

General Requirements Applicable to FIBOs

Regulation of advertisement

Under the FIEA, any advertisement published by an FIBO etc must include the following information:

(1) its company name;

(2) the fact that it is an FIBO etc and its registration number;

(3) the fee to be paid to the FIBO etc;

(4) the amount or calculation method of the required deposit;

(5) the potential risk of the loss suffered by customers exceeding the deposits placed for derivatives transactions and the ratio of the deposit to the transaction amount;

(6) the potential risk of loss by customers and direct cause of such loss (eg, due to changes in the interest rate, value of currency or other relevant index);

(7) the potential risk of the loss suffered by customers in (6) above exceeding the principal (if any) and direct cause of such loss;

(8) the spread between ordering price and executed price, if any;

(9) facts that might have significant adverse effect on customers; and

(10) the self-regulatory organisation which the FIBO etc has joined (eg, JSDA)

Suitability principle

FIBOs etc have to follow the principle of suitability when marketing financial instruments to non-professional investors. The principle of suitability requires FIBOs etc to adjust their manner of solicitation as appropriate in light of the customer’s sophistication (as determined from the customer’s knowledge, experience, assets and purpose for purchasing the product, among other factors).

Requirement of written statutory disclosure to customers

Under the FIEA, when conducting transactions with customers, FIBOs etc are required to deliver certain paper-based statutory disclosure documents containing the information relating to the transactions to the customers. As a result of the amendments to the FIEA which were passed by the Diet on 20 November 2023, this requirement will be modified to shift the focus from requiring FIBOs etc to deliver specific paper documents to requiring FIBOs etc to disclose important information regarding the substance of the transactions to the customers. In other words, while FIBOs will no longer be required to disclose the information relating to the transactions to customers in paper form, they will be required to ensure that they have provided sufficient explanations and information to the customers so that the customers are able to understand the substance of the transactions.

Prohibition of loss compensation

FIBOs etc are prohibited from providing loss compensation, additional profits or special benefits to a customer in connection with derivatives transactions in violation of the FIEA.

Regulations under the Act on Provision of Financial Services

Under the Act on Provision of Financial Services and Maintenance of Usage Environment (Act No. 101 of 2000, as amended, “APFSMUE”), the seller of a financial instrument has a duty to explain important matters at the point of, or before, the sale of financial instruments. A breach of this duty gives rise to a private cause of action, with the burden of proof on the seller to prove the amount of damage (ie, the loss incurred by a customer is presumed to be the loss due to the failure of the duty). It is also prohibited to provide conclusive evaluation on uncertain matters or misleading information to customers. These regulations can be applied to derivatives transactions.

As we described in 2.6 Exemptions, Non-derivative Products and Spot Transactions, exemptions from the registration requirement under the FIEA or from the licensing requirement under the CFEA are available in cases where counterparties are limited to certain eligible investors.

In addition, FIBOs are exempt from compliance with some of the key provisions on conduct in the FIEA (such as the principle of suitability, the requirement to deliver written statutory disclosure documents to customers, the prohibition of solicitation without consent, and the advertisement regulations) where the counterparties are professional investors. For this purpose, professional investors include qualified institutional investors (QIIs), listed stock corporations, stock corporations with stated capital of at least JPY500 million, special purpose companies established pursuant to the Act on Securitisation of Assets of Japan (known as TMKs) and foreign corporations. Individuals with trading experience of at least one year, and net and invested assets of at least JPY300 million, as well as other corporations, may apply to change their status from general investors to professional investors.

Further, the obligation under the APFSMUE to explain important matters as mentioned in 3.1.6 Business Conduct would not be applicable where the counterparties are professional investors.

Derivatives are regulated at the level of national laws, although certain supervisory functions are delegated by the national regulators (ie, the JFSA, METI and MAFF) to the Local Finance Bureau; the Regional Bureau of Economy, Trade and Industry; and the Regional Agricultural Administration Offices.

The following self-regulatory organisations operate in Japan:

  • Japan Securities Dealers Association (JSDA) for Type I FIBOs and Registered Financial Institutions regulated under the FIEA;
  • Financial Futures Association of Japan (FFAJ) for FX and interest rate derivatives (including OTC binary option derivatives) regulated under the FIEA;
  • Japan Commodity Futures Industry Association (JCFIA) for commodity derivatives regulated under the CFEA; and
  • Japan Virtual and Crypto assets Exchange Association (JVCEA) for crypto-asset derivatives regulated under the FIEA.

These self-regulatory organisations are subject to the national-level oversight by the JFSA, the METI and/or the MAFF (as applicable).

The industry standard for documentation of OTC derivatives is the ISDA documentation including but not limited to the ISDA Master Agreement, ISDA Credit Support Annex (CSA) and ISDA Definitions.

When using ISDA documentation, a short form confirmation is typically prepared by the dealer with reference to the relevant ISDA Definitions. Master confirmation agreements are sometimes prepared for certain equity derivatives transactions.

For ETDs, it is usual that the standard form terms and conditions are delivered by the dealer to customers. Such terms and conditions would govern the contractual relationship between the dealer and each customer (eg, settlement and custody arrangement) with reference to the relevant exchange rules and the CCP’s clearing rules.

Before the introduction of the regulatory variation margin requirement for uncleared OTC derivatives under the FIEA, the typical documentation for the exchange of margin was (i) a Japanese law CSA (loan and pledge), (ii) an English law CSA (title transfer) or (iii) a New York law CSA (security interest).

Documentation for Variation Margin

The ISDA CSAs mentioned in 4.1.1 Industry Standards and Master Agreements were updated in line with the regulatory variation margin requirement under the FIEA, and the parties now typically enter into (a) a Japanese law VM CSA (loan), (b) an English law VM CSA (title transfer) or (c) a New York law VM CSA (security interest). If a Japanese counterparty enters into (b) or (c) above, it is generally recommended that the Japanese Party Annex be incorporated in order to ensure that the close-out netting arrangement will be protected in Japanese insolvency proceedings.

Documentation for Initial Margin

Since the regulatory initial margin requirement for uncleared OTC derivatives was introduced under the FIEA, parties have typically entered into (i) an English law IM CSD or New York law IM CSA (including the Japanese Securities Provisions) and an Account Control Agreement, (ii) an ISDA Euroclear Collateral Transfer Agreement (including the Japanese Collateral Provisions) and an ISDA Euroclear Security Agreement or (iii) an ISDA Clearstream Collateral Transfer Agreement and ISDA Clearstream Security Agreement (including the Recommended Amendment Provisions with respect to Japanese Collateral), depending on which global custodian is retained by the parties (eg, BNY Mellon, Euroclear or Clearstream).

In addition, for certain domestic transactions, the parties may also have entered into an ISDA 2016 Phase One Credit Support Annex for Initial Margin (IM) (Loan – Japanese Law) and a Trust Scheme Addendum. There are also domestic transactions in which a Japanese language trust agreement for initial margin is entered into by the parties.

Japanese parties may have also entered into a Japan Initial Margin Threshold Agreement, a template which enables parties to agree on a threshold amount applicable to each posting party in order to benefit from the documentation relief under the Japanese regulatory initial margin requirement in the case where the bilateral initial margin amount does not exceed JPY7 billion threshold on a group basis.

Each Japanese bank may have its own standard form bespoke Japanese language derivative master agreement for its Japanese customers (eg, domestic Japanese corporations and individuals).

In addition, the JSDA publishes Japanese language master agreements for securities transactions such as the Master Agreement for Bond Transactions with Repurchase Agreement (Gensaki Transactions) and the Master Agreement for Bond Lending Transactions. These master agreements are widely used in Japan.

For cross-border repo and securities lending transactions, GMRAs, MRAs, MSFTAs, GMSLAs and MSLAs are often entered into by Japanese parties with overseas counterparties or global financial institutions.

For Designated Cleared Transactions to which the JSCC as a CCP offers clearing services, the JSCC establishes a form of Clearing Brokerage Agreement which must be entered into between the clearing broker and its customer as part of the JSCC’s clearing rule. The clearing broker and the customer may execute a side letter (or any other supplemental instrument) to the extent it does not conflict with the Clearing Brokerage Agreement.

In addition, the ISDA/FIA Cleared Derivatives Execution Agreement is widely used for cleared derivatives by market participants in Japan.

In order to recognise the effect of the close-out netting arrangement for the purpose of calculation of the regulatory capital of Japanese banks, it is in practice required to obtain a legal opinion. More specifically, the relevant Japanese FSA’s Basel Q&A requires Japanese banks to confirm the existence of a reasonable written legal opinion, according to which the competent judicial court and authority would likely determine that the bank’s exposure will be limited to the amount which is netted pursuant to the applicable netting agreement in light of the related laws upon occurrence of any legal dispute. In addition, Japanese banks may consider obtaining a legal opinion on the validity and enforceability of the collateral arrangement for the purpose of taking into account the credit risk mitigation effect of the collateral arrangement when calculating the regulatory capital.

Under the FIEA, a person who conducts a Financial Instruments Business must be registered with the JFSA as an FIBO. Breach of such registration requirement could result in criminal penalties (ie, imprisonment and/or fine). In practice, it is common that the JFSA posts to its website the names of unregistered business operators and a summary of their unregistered business, as well as individually giving written warnings to such business operators. Especially, while a foreign business operator’s act of soliciting Japanese investors from outside Japan in principle constitutes a Financial Instruments Business (unless any relevant exemption applies), a number of such warnings have been made to such unregistered foreign business operators. Approximately 20 operators’ names have been posted on the JFSA’s website as unregistered operators over the latest 12 months. The trend towards enforcement is expected to continue as the JFSA’s examination priority. The METI and the MAFF have also made similar warnings in the past.

Anderson Mori & Tomotsune

Otemachi Park Building
1-1-1 Otemachi, Chiyoda-ku
Tokyo 100-8136
Japan

+81-3-6775-1154

+81-3-6775-2154

daisuke.tanimoto@amt-law.com www.amt-law.com
Author Business Card

Trends and Developments


Authors

Daisuke Tanimoto
Mitsuo Shimada

Anderson Mori & Tomotsune (AMT) has an established derivatives practice and is recognised for its ability to handle complex issues surrounding sophisticated derivatives transactions. Its attorneys are regularly engaged to draft and negotiate ISDA documents and other derivative contracts, in addition to providing support in a broad range of regulatory compliance issues involving over-the-counter derivative transactions, including variation and initial margin requirements. AMT advises on all major categories of derivatives transactions, such as currency, interest rate, equity, credit, and commodity derivatives, as well as earthquake, energy, carbon credit, and crypto asset derivatives. AMT’s attorneys often act in structured finance transactions involving hybrid instruments such as structured deposits, synthetic collateralised debt obligations (CDOs), credit-linked notes (CLNs), credit-linked loans (CLLs) and repackaged notes. In addition, AMT advises on cross-border transactions with multi-jurisdictional elements, including conducting research on foreign laws and regulations in collaboration with leading overseas law firms.

Close-Out Netting of OTC Derivative Transactions Referencing Digital Assets Under the Laws of Japan

The growing prevalence of OTC (over-the-counter) derivative transactions referencing digital assets (“OTC digital asset derivative transactions”) has led to extensive discussions about whether – and to what extent – close-out netting arrangements for such transactions would be valid and enforceable in events of insolvency under Japanese law.

Crypto-assets are defined in Article 2, Paragraph 14 of the Payment Services Act (Act No. 59 of 2009, as amended; the “PSA”). However, the legal nature of crypto-assets (such as Bitcoin and Ethereum) and other digital assets is still a fluid concept under Japanese law. Moreover, every digital asset has its own distinct characteristics. Accordingly, product-by-product analysis is required to discuss the validity and enforceability of netting arrangements in respect of OTC digital asset derivative transactions. In this context, this article summarises the fundamental legal framework regarding the validity and enforceability of close-out netting arrangements under Japanese law.

Close-Out Netting Under the Netting Act

Close-out netting arrangements for OTC digital asset derivative transactions are considered valid and enforceable if they meet the requirements outlined in the Act on Close-out Netting of Specified Financial Transactions entered into by Financial Institutions (Act No. 108 of 1998, as amended, referred to as the “Netting Act”).

More specifically, close-out netting will be enforceable under the Netting Act if:

  • at least one of the parties is a financial institution;
  • the parties have entered into specified financial transactions;
  • the specified financial transactions are governed by a master agreement;
  • the master agreement contains provisions on eligible close-out netting; and
  • one of the parties has become subject to a Japanese insolvency event.

In relation to the above, the terms “financial institution,”“specified financial transactions,” and “master agreement” are especially pertinent. Therefore, we will now examine each of these terms.

Financial institution

The term “financial institution” encompasses the following entities:

  • banks;
  • broker-dealers;
  • insurance companies;
  • federation of cooperative banks (shinnyo kinko rengou kai);
  • Norinchukin Bank;
  • Shoko Chukin Bank;
  • Japan Bank for International Cooperation;
  • securities financing companies;
  • call loan dealers; and
  • commodities futures transaction dealers.

A dealer that engages in the business of OTC derivative transactions referencing crypto-assets as a principal, agent, intermediary or broker is generally required to undergo registration as a Type I Financial Instruments Business Operator under the Financial Instruments and Exchange Act (Act No. 25 of 1948, as amended; the “FIEA”). Meanwhile, a dealer that engages in the business of trading crypto-assets as a principal, agent, intermediary or broker, providing custody services for customers’ fiat currency in connection with such trading or managing crypto-assets for the benefit of others is generally required to undergo registration as a Crypto-Asset Exchange Services Provider under the PSA. Under the Netting Act, Type I Financial Instruments Business Operators are classified as Financial Institutions, albeit the Crypto-Asset Exchange Services Providers do not.

Specified financial transactions

The term “specified financial transactions” includes the following transactions:

  • OTC derivative transactions (as such term is defined under the FIEA);
  • financial derivative transactions under Article 10, Paragraph 2, Item 14 of the Banking Act (Act No. 59 of 1981, as amended);
  • conditional sale and purchase of securities;
  • securities lending;
  • sale and purchase of securities with options;
  • forward foreign exchange transactions;
  • OTC commodity derivative transactions defined under the Commodity Derivatives Transaction Act (Act No. 239 of 1950, as amended); and
  • loans for consumption or deposits for consumption of cash or securities as collateral to secure any transactions listed above.

It is important to note that OTC derivative transactions referencing crypto-assets fall within the scope of OTC derivative transactions since, under the Financial Instruments and Exchange Act (FIEA), crypto-assets are categorised as financial instruments. Additionally, the Financial Services Agency of Japan (FSA) can designate any electronic payment instrument (primarily stablecoins as defined in the Payment Services Act (PSA)) as a financial instrument. However, the FSA has not yet exercised this discretion. In view of the foregoing, it is important to determine whether the digital assets referenced by a specific OTC digital asset derivative transaction constitute crypto-assets under the PSA to ascertain whether the Netting Act applies to such OTC digital asset derivative transactions.

Master agreement

The term “master agreement” is broadly defined in Article 2, Paragraph 5 of the Netting Act as “an agreement intended to govern two or more Specified Financial Transactions to be entered into on a continuing basis between a Financial Institution and a counterparty, stipulating the terms of such transactions and other basic matters relating thereto.” 

The ultimate master agreement, which governs two or more master agreements, is generally understood to be the master agreement (as defined under the Netting Act).

The ISDA master agreement is a prime example of a “master agreement.” However, it is important to analyse whether other master agreements designed specifically for OTC digital asset derivative transactions also meet the definition of a master agreement, as in some instances, they may need to be revised to ensure compliance with the Netting Act. 

Close-Out Netting Under the Bankruptcy Act

An OTC digital asset derivative transaction that does not fall within the ambit of the Netting Act may nevertheless fall within the ambit of close-out netting under Article 58 of the Bankruptcy Act (Act No. 75 of 2004, as amended), which provides as follows.

(1) If an agreement involving transactions in instruments that have quotations on organised exchanges or other markets cannot fulfil its objectives unless it is settled at a specific time and date, and if the scheduled settlement time and date occur after the start of bankruptcy proceedings, then the contract is considered terminated upon the initiation of those bankruptcy proceedings.

(2) In the case mentioned in paragraph (1) above, the amount of damages arising from the termination of the agreement should be the difference between the market quotation prevailing at the relevant place and time and the contract price.

(3) [Omitted.]

(4) In connection with the matters mentioned in paragraphs (1) and (2) above, if the relevant exchange or market has different provisions, then paragraphs (1) and (2) should be interpreted in line with and in accordance with the rules of that exchange or market, as applicable.

(5) If a master agreement for repeated transactions, as outlined in paragraph (1) above, specifies that all transactions should be settled by netting the damages described in paragraph (2) above, then the amount of damages one party owes to the other should be determined according to that provision.

With respect to paragraph (1) above, it is necessary to determine whether the digital assets referenced by an OTC digital asset derivative transaction have “quotations on organised exchanges or other markets.” Furthermore, in order to ensure that “the contract is deemed to be terminated upon the commencement of the bankruptcy proceeding,” as is the case with other derivative transactions, it may be advisable to insert an automatic early termination provision in the contract.

Article 58 of the Bankruptcy Act will apply mutatis mutandis to a party with respect to which a civil rehabilitation or corporate reorganisation proceeding is commenced (Article 51 of the Civil Rehabilitation Act (Act No. 225 of 1999, as amended), Article 63 of the Corporate Reorganization Act (Act No. 154 of 2002, as amended) and Article 41, Paragraph 3 and Article 206, Paragraph 3 of the Act on Special Measures for the Reorganization Proceedings of Financial Institutions (Act No. 95 of 1996, as amended), respectively).

Close-Out Netting by Way of Set-Off

Even if an OTC digital asset derivative transaction does not fall within the ambit of the Netting Act or Article 58 of the Bankruptcy Act, the non-defaulting party in such a transaction may still be able to exercise its statutory or contractual set-off rights. In this regard, the contractual set-off rights would be enforceable if the requirements of Article 505, Paragraph 1 of the Civil Code (Act No. 89 of 1896, as amended), which are set forth as follows, are met:

  • all the receivables and payables to be set-off are held by parties bound to each other;
  • the parties are bound by obligations the nature of which are of the same kind; and
  • the obligations of both parties under the agreement are due and payable.

To evaluate whether an OTC digital asset derivative transaction complies with all the requirements of Article 505, Paragraph 1, each case must be assessed individually, taking into consideration the specific type and nature of these transactions.

Conclusion

Although there is currently no standard practice in Japan regarding close-out netting arrangements for OTC digital asset derivative transactions, it is hoped that with the increasing prevalence of such transactions and the corresponding need to analyse them, standardised practice for such close-out netting will soon emerge.

Anderson Mōri & Tomotsune

Otemachi Park Building
1-1-1 Otemachi, Chiyoda-ku
Tokyo 100-8136
Japan

+81-3-6775-1154

+81-3-6775-2154

daisuke.tanimoto@amt-law.com www.amt-law.com
Author Business Card

Law and Practice

Authors

Daisuke Tanimoto
Etsuko Yamazaki
Miki Okuda

Anderson Mori & Tomotsune has a well-established derivatives practice and is adept at responding to the complex issues surrounding sophisticated derivatives transactions. Its expert lawyers regularly provide services for the negotiation and drafting of ISDA documents and other derivative contracts. They also provide support on a broad range of regulatory compliance issues regarding over-the-counter derivatives transactions including variation and initial margin requirements. They provide advice on all major categories of derivative, such as currency, interest rate, equity, credit and commodity derivatives. They also advise on earthquake, energy, carbon credit and crypto-asset derivatives, as well as structured finance transactions involving hybrid instruments such as structured deposits, synthetic collateralised debt obligations, credit-linked notes, credit-linked loans and repackaged notes. In addition, they advise on cross-border transactions with multi-jurisdictional elements and conduct research on foreign laws and regulations by working closely with leading overseas law firms.

Trends and Developments

Authors

Daisuke Tanimoto
Mitsuo Shimada

Anderson Mori & Tomotsune (AMT) has an established derivatives practice and is recognised for its ability to handle complex issues surrounding sophisticated derivatives transactions. Its attorneys are regularly engaged to draft and negotiate ISDA documents and other derivative contracts, in addition to providing support in a broad range of regulatory compliance issues involving over-the-counter derivative transactions, including variation and initial margin requirements. AMT advises on all major categories of derivatives transactions, such as currency, interest rate, equity, credit, and commodity derivatives, as well as earthquake, energy, carbon credit, and crypto asset derivatives. AMT’s attorneys often act in structured finance transactions involving hybrid instruments such as structured deposits, synthetic collateralised debt obligations (CDOs), credit-linked notes (CLNs), credit-linked loans (CLLs) and repackaged notes. In addition, AMT advises on cross-border transactions with multi-jurisdictional elements, including conducting research on foreign laws and regulations in collaboration with leading overseas law firms.

Compare law and practice by selecting locations and topic(s)

{{searchBoxHeader}}

Select Topic(s)

loading ...
{{topic.title}}

Please select at least one chapter and one topic to use the compare functionality.