Deposit Insurance Act (Tentative translation)
Chapter I General Provisions (Articles 1 to 2)
Chapter II Deposit Insurance Corporation
Section 1 General Provisions (Articles 3 to 8)
Section 2 Establishment (Articles 9 to 13)
Section 3 Policy Board (Articles 14 to 23)
Section 4 Executives, etc. (Articles 24 to 33)
Section 5 Operations (Articles 34 to 37)
Section 6 Finance and Accounting (Articles 38 to 44)
Section 7 Supervision (Articles 45 to 46)
Section 8 Auxiliary Provisions (Articles 47 to 48)
Chapter III Deposit Insurance
Section 1 Deposit Insurance Relationship (Article 49)
Section 2 Payment of Deposit Insurance Premiums (Articles 50 to 52)
Section 3 Payment of Deposit Insurance Claims, etc. (Articles 53 to 58-3)
Section 4 Financial Assistance (Articles 59 to 69)
Chapter III-2 Protection of Creditors Regarding Settlement of Funds (Articles 69-2 to 69-4)
Chapter IV Purchase of Deposits and Other Claims (Articles 70 to 73)
Chapter V Management by Financial Administrator (Articles 74 to 90)
Chapter VI Transfer of Business of Failed Financial Institutions (Articles 91 to 101)
Chapter VI-2 Purchase of Specified Claims That Are Difficult to Collect Held by Financial Institution (Article 101-2)
Chapter VII Responses to Financial Crises (Articles 102 to 126)
Chapter VII-2 Measures for Orderly Resolution of Assets and Liabilities of Financial Institutions, etc. for Ensuring Financial System Stability (Articles 126-2 to 126-39)
Chapter VIII Miscellaneous Provisions (Articles 127 to 140)
Chapter IX Penal Provisions (Articles 141 to 153)
Supplementary Provisions
Chapter I General Provisions
(Purpose)
Article 1 The purpose of this Act is to protect Depositors, etc. and ensure settlement of funds pertaining to Failed Financial Institutions, by providing for the payment of deposit insurance proceeds and purchase of deposits and other claims necessary in the event that repayment of Deposits, etc. is suspended by Financial Institutions, and by establishing a system for providing appropriate financial assistance to facilitate mergers and other resolutions of Failed Financial Institutions, the management of Failed Financial Institutions by financial administrators, the transfer of business of Failed Financial Institutions, and any other measures concerning the failure resolution of Financial Institutions, measures for the purchase of Specified Claims That Are Difficult to Collect, measures in response to financial crises, and measures for orderly resolution of assets and liabilities of Financial Institutions, etc., thereby contributing to the maintenance of an orderly credit system.
(Respect for Autonomy of Financial Institutions)
Article 1-2 In the application of this Act, consideration shall be given to the autonomy of Financial Institutions.
(Definitions)
Article 2 (1) The term "Financial Institutions" as used in this Act means the following (excluding those whose head office is located outside the jurisdiction where this Act is effective):
(i) the banks prescribed in Article 2, paragraph (1) of the Banking Act (Act No. 59 of 1981) (hereinafter referred to as "Banks");
(ii) the long-term credit banks prescribed in Article 2 of the Long-Term Credit Bank Act (Act No. 187 of 1952) (hereinafter referred to as "Long-Term Credit Banks");
(iii) shinkin banks;
(iv) credit cooperatives;
(v) labor banks;
(vi) federations of shinkin banks;
(vii) federations of credit cooperatives engaged in the business provided for in Article 9-9, paragraph (1), item (i) of the Small and Medium-Sized Enterprises Cooperatives Act (Act No. 181 of 1949) (hereinafter referred to as "Federations of Credit Cooperatives");
(viii) federations of labor banks; and
(ix) The Shoko Chukin Bank, Ltd.
(2) The term "Deposits, etc." as used in this Act means the following:
(i) deposits;
(ii) installment savings;
(iii) installment deposits prescribed in Article 2, paragraph (4) of the Banking Act;
(iv) money received under contracts pertaining to money trusts (including loan trusts) for compensating for a loss of principal pursuant to the provisions of Article 6 of the Act on Provision, etc. of Trust Business by Financial Institutions (Act No. 43 of 1943); and
(v) money received through the issuance of Long-Term Credit Bank bonds under Article 8 of the Long-Term Credit Bank Act, specified bonds under Article 8, paragraph (1) of the Act on Financial Institutions' Merger and Conversion (Act No. 86 of 1968) (including the cases where it is applied mutatis mutandis pursuant to the provisions of Article 55, paragraph (4) of said Act) (including debentures issued under Article 17-2, paragraph (1) of the Act on Financial Institutions' Merger and Conversion (including the cases where it is applied mutatis mutandis pursuant to the provisions of Article 24, paragraph (1), item (vii) of said Act) before the revision by Article 199 of the Act on the Development, etc. of Relevant Acts Associated with the Enforcement of the Companies Act (Act No. 87 of 2005)), national federation of shinkin banks bonds under Article 54-2-4, paragraph (1) of the Shinkin Bank Act (Act No. 238 of 1951), and commercial and industrial bonds under Article 33 of The Shoko Chukin Bank Limited Act (Act No. 74 of 2007) (including those that are deemed pursuant to the provisions of Article 37 of the Supplementary Provisions of said Act to be commercial and industrial bonds issued under Article 33 of said Act) (limited to those specified by Cabinet Order as those for which rightholders can be ascertained and referred to in Article 58-2, paragraph (1) and Article 73, paragraph (1) as "Long-Term Credit Bank Bonds, etc.").
(3) The term "Depositors, etc." as used in this Act means depositors and other creditors pertaining to the Deposits, etc.
(4) The term "Failed Financial Institution" as used in this Act means a Financial Institution that has suspended repayment of Deposits, etc. (meaning the performance of obligations pertaining to Deposits, etc.; the same shall apply hereinafter) or is likely to suspend repayment of Deposits, etc. in light of the status of its business or property.
(5) The term "Bank Holding Company, etc." as used in this Act means the following:
(i) a bank holding company prescribed in Article 2, paragraph (13) of the Banking Act;
(ii) a company that has obtained the authorization under Article 52-17, paragraph (1) of the Banking Act to become a holding company which has as its subsidiary a bank which falls under the Failed Financial Institution through the acquisition of the shares of said bank (meaning a holding company which has a bank as its subsidiary company prescribed in Article 52-17, paragraph (1) of said Act; the same shall apply in Article 61, paragraph (8));
(iii) a Long-Term Credit Bank holding company prescribed in Article 16-4, paragraph (1) of the Long-Term Credit Bank Act;
(iv) a company that has obtained the authorization under Article 16-2-4, paragraph (1) of the Long-Term Credit Bank Act to become a holding company which has a Long-Term Credit Bank as its subsidiary company (meaning a holding company which has a Long-Term Credit Bank as its subsidiary company prescribed in Article 16-2-4, paragraph (1) of said Act; hereinafter the same shall apply in Article 61, paragraph (8)) through the acquisition of shares of a Long-Term Credit Bank that falls under the Failed Financial Institution; and
(v) a company that is not listed in the preceding items (excluding banks and Long-Term Credit Banks) and that has a bank or Long-Term Credit Bank (hereinafter referred to as "Bank, etc.") as its subsidiary company (meaning a company of which voting rights exceeding fifty hundredths of the voting rights held by all of its shareholders (excluding voting rights relating to shares held by shareholders who may not exercise their voting rights for all of the matters which may be resolved at a shareholders meeting but including voting rights relating to shares for which holders are deemed to have voting rights pursuant to the provisions of Article 879, paragraph (3) of the Companies Act (Act No. 86 of 2005); hereinafter the same shall apply in this item and paragraph (13)) are held by another company; hereinafter the same shall apply in this item) or intends to have the Bank, etc. become its subsidiary company.
(6) The term "Preferred Shares, etc." as used in this Act means preferred shares (meaning shares for which, at the time of issuance, there are no matters on which voting rights may be exercised, with preferred contents with regard to dividends of surplus and distribution of residual assets; the same shall apply hereinafter), subordinated bonds (meaning bonds with a special clause of subordinated contents with regard to the payment of principal and interest, and which fall under bonds specified by Cabinet Order as contributing to the adequacy of equity capital of a Bank, etc., Bank Holding Company, etc. or The Shoko Chukin Bank, Ltd.; the same shall apply hereinafter), or preferred equity investments (meaning preferred equity investments prescribed in the Act on Preferred Equity Investment by Cooperative Structured Financial Institution (Act No. 44 of 1993; hereinafter referred to as the "Preferred Equity Investment Act"); the same shall apply hereinafter).
(7) The term "Shares, etc." as used in this Act means shares other than preferred shares and the Preferred Shares, etc.
(8) The term "Subscription for Preferred Shares, etc." as used in this Act means subscription for Preferred Shares, etc. or loans for consumption made pursuant to Subordinated Loan Agreements (meaning loans for consumption falling under those with a special clause of subordinated contents with regard to the payment of principal and interest, and which are specified by Cabinet Order as contributing to the adequacy of equity capital of a Financial Institution or Bank Holding Company, etc.).
(9) The term "Subscription for Shares, etc." as used in this Act means subscription for shares other than preferred shares or the Subscription for Preferred Shares, etc.
(10) The term "Securing of Damage" as used in this Act means compensation to creditors, based on a contract concluded in advance, through partial repayment of an unpaid amount of a loan in cases where obligations under the loan have become unsatisfied in whole or in part.
(11) The term "Transfer of Insured Deposits" as used in this Act means assumption of obligations pertaining to the Deposits, etc. of a Failed Financial Institution by another Financial Institution, when such obligations include obligations pertaining to the Deposits, etc. corresponding to amounts of insurance proceeds calculated under the provisions of Article 54, paragraphs (1) to (3) (including the cases where the provisions of said paragraphs are applied mutatis mutandis pursuant to Article 54-2, paragraph (2)) and Article 54-2, paragraph (1) (hereinafter referred to as the "Insurance Claim Calculation Provision") (excluding those associated with the transfer or assumption of business (hereinafter referred to as "Business Transfer, etc.")).
(12) The term "Financial Institution under Management" as used in this Act means a Financial Institution that has become subject to the injunction ordering management prescribed in Article 74, paragraph (1) pursuant to the provisions of Article 74, paragraph (1) or (2) or Article 110, paragraph (1).
(13) The term "Bridge Bank" as used in this Act means a bank that has succeeded to the business of a Financial Institution under Management through the assumption of business, Transfer of Insured Deposits, merger, or company split (hereinafter referred to as "Assumption of Business, etc."), whose primary purpose is to maintain and continue said business on a temporary basis, and that has been established as a subsidiary company of the Deposit Insurance Corporation (meaning a company of which voting rights exceeding fifty hundredths of the voting rights held by all of its shareholders are held by the Deposit Insurance Corporation; the same shall apply hereinafter).
Chapter II Deposit Insurance Corporation
Section 1 General Provisions
(Legal Personality)
Article 3 The Deposit Insurance Corporation (hereinafter referred to as the "Corporation") shall be a corporation.
(Number)
Article 4 Regarding the Corporation, only one shall be established.
(Capital)
Article 5 (1) The capital of the Corporation shall be the total amount of capital contributed by the government and other persons at the time of the Corporation's establishment.
(2) The Corporation may, when necessary, increase its capital with the authorization of the Prime Minister and the Minister of Finance.
(Name)
Article 6 (1) The Corporation shall use the phrase "Deposit Insurance Corporation" in its name.
(2) No person other than the Corporation shall use the phrase "Deposit Insurance Corporation" in its name.
(Registration)
Article 7 (1) The Corporation shall be registered pursuant to the provisions of Cabinet Order.
(2) The matters required to be registered under the preceding paragraph may not be asserted against a third party until after they have been registered.
(Application Mutatis Mutandis of Act on General Incorporated Associations and General Incorporated Foundations)
Article 8 The provisions of Article 4 and Article 78 of the Act on General Incorporated Associations and General Incorporated Foundations (Act No. 48 of 2006) apply mutatis mutandis to the Corporation.
Section 2 Establishment
(Founders)
Article 9 Seven or more persons with experience and expertise in financial matters shall act as founders in order to establish the Corporation.
(Preparation of Articles of Incorporation, etc.)
Article 10 (1) The founders shall promptly prepare the articles of incorporation of the Corporation and solicit capital contributions to the Corporation from persons other than the government.
(2) The articles of incorporation referred to in the preceding paragraph shall state the following matters:
(i) purpose;
(ii) name;
(iii) location of offices;
(iv) matters concerning capital and capital contribution;
(v) matters concerning the Policy Board;
(vi) matters concerning officers;
(vii) matters concerning operations and their execution;
(viii) matters concerning finance and accounting;
(ix) matters concerning amendment of the articles of incorporation; and
(x) method of public notice.
(Authorization for Establishment)
Article 11 Promptly after the solicitation set forth in paragraph (1) of the preceding Article has been completed, founders shall submit the articles of incorporation to the Prime Minister and the Minister of Finance and apply for authorization for establishment.
(Transfer of Affairs)
Article 12 (1) When the authorization set forth in the preceding Article is granted, founders shall hand over their affairs without delay to the person who is to become the governor of the Corporation.
(2) The person who is to become the governor of the Corporation shall, when he/she has taken over the affairs under the preceding paragraph, request without delay the government and persons other than the government who have agreed to make capital contributions in response to the solicitation to pay in capital contributions.
(Registration of Establishment)
Article 13 (1) When capital contributions are paid in pursuant to the provisions of paragraph (2) of the preceding Article, the person who is to become the governor of the Corporation shall register its establishment without delay pursuant to the provisions of Cabinet Order.
(2) The Corporation shall be established upon the registration of its establishment.
Section 3 Policy Board
(Establishment)
Article 14 A policy board (hereinafter referred to as the "Policy Board") shall be established within the Corporation.
(Authority)
Article 15 In addition to matters separately specified by this Act (excluding Chapter I, Chapter II, Chapter V, and Chapter IX), the following matters shall require a resolution of the Policy Board:
(i) amendment of the articles of incorporation;
(ii) preparation of and amendments to the statement of operation procedures;
(iii) budget and funding plans;
(iv) settlement of accounts; and
(v) other matters deemed particularly necessary by the Policy Board.
(Organization)
Article 16 (1) The Policy Board shall be composed of not more than eight members in addition to the governor and the deputy governors of the Corporation.
(2) When it is necessary for carrying out study and deliberation of special matters, the Policy Board may have up to four temporary members.
(3) The Policy Board shall have a chairperson, who shall be the governor of the Corporation.
(4) The chairperson shall preside over the affairs of the Policy Board.
(5) The Policy Board shall designate in advance, from among its members and the deputy governors of the Corporation, a person who performs the duties of the chairperson in his/her place in the event that the chairperson is unable to attend to his/her duties.
(Appointment of Members, etc.)
Article 17 Members and temporary members (hereinafter referred to as "Members, etc.") shall be appointed from among persons with experience and expertise in financial matters by the governor of the Corporation with the authorization of the Prime Minister and the Minister of Finance.
(Term of Office of Members, etc.)
Article 18 (1) The term of office of members shall be one year; provided, however, that the term of office of a member who fills a vacancy shall be the remaining term of such predecessor.
(2) Members may be reappointed.
(3) Temporary members shall be dismissed when the study and deliberation of the special matters pertaining to their appointment have been concluded.
(Dismissal of Members, etc.)
Article 19 The governor of the Corporation may dismiss a Member, etc. with the authorization of the Prime Minister and the Minister of Finance if such Member, etc. has come to fall under any of the following items:
(i) the Member, etc. has received a ruling for the commencement of bankruptcy proceedings;
(ii) the Member, etc. has been sentenced to imprisonment without work or a heavier punishment;
(iii) the Member, etc. is deemed unable to execute his/her duties due to mental or physical disability; or
(iv) the Member, etc. has breached his/her obligations in the course of duties.
(Remuneration of Members, etc.)
Article 20 Members, etc. shall not receive any remuneration; provided, however, that they shall be paid travel expenses and other actual expenses incurred in connection with the execution of their duties.
(Method of Resolutions)
Article 21 (1) The Policy Board may not convene a meeting or deliberate a resolution unless the chairperson or the person who performs the duties of the chairperson prescribed in Article 16, paragraph (5) and half or more of the members, temporary members concerned with the business of the meeting, and deputy governors of the Corporation are present.
(2) A decision of the Policy Board shall be made by a majority of the votes of the chairperson, members, temporary members concerned with the business of the meeting, and deputy governors of the Corporation who are present. In the event of a tie, the chairperson shall cast the deciding vote.
(3) Staff members appointed by the Prime Minister or the Minister of Finance, may attend the meeting prescribed in paragraph (1) and express opinions.
(4) The executive directors of the Bank of Japan who are appointed by the Bank of Japan's Policy Board may attend the meeting prescribed in paragraph (1) and express opinions.
(Confidentiality Obligations of Members, etc.)
Article 22 Members, etc. shall not divulge any secret which may have come to their knowledge in the course of their duties. The same shall apply after they have left their position.
(Status of Members, etc. as Public Officials)
Article 23 Members, etc. shall be deemed to be officials engaging in public duties pursuant to the provisions of laws and regulations with regard to the application of the Penal Code (Act No. 45 of 1907) and other penal provisions.
Section 4 Officers, etc.
(Officers)
Article 24 The Corporation shall have, as its officers, one governor, not more than four deputy governors, and one inspector.
(Duties and Authority of Officers)
Article 25 (1) The governor shall represent the Corporation and preside over its operations.
(2) The deputy governors shall, in accordance with decisions made by the governor, represent the Corporation, assist the governor in administrating the operations of the Corporation, perform the duties of the governor in his/her place in the event that the governor is unable to attend to his/her duties, and perform the duties of the governor when the post is vacant.
(3) The inspector shall audit the operations of the Corporation.
(4) The inspector may, when he/she finds it necessary based on the audit results, submit his/her opinion to the governor or the Prime Minister and the Minister of Finance.
(Appointment of Officers)
Article 26 (1) Officers shall be appointed by the Prime Minister with consent from both Houses of the Diet.
(2) Notwithstanding the provisions of the preceding paragraph, the Prime Minister may appoint an officer if the term of office of an officer expires or a vacancy occurs at a time when the Diet is out of session or the House of Representatives has been dissolved and it is impossible to obtain consent from both Houses.
(3) In the case referred to in the preceding paragraph, ex post facto consent by both Houses of the Diet shall be obtained in the first Diet after the appointment. In this case, if the ex post facto consent cannot be obtained by both Houses of the Diet, the Prime Minister shall immediately dismiss said officer.
(Term of Office of Officers)
Article 27 (1) The term of office of officers shall be two years.
(2) Officers may be reappointed.
(3) When the term of office of an officer has expired, said officer shall continue to carry out his/her duties until his/her successor is appointed.
(Ineligibility of Officers)
Article 28 No employee of the government or a local public entity (excluding part-time employees) shall be eligible to become an officer.
(Dismissal of Officers)
Article 29 (1) The Prime Minister shall dismiss an officer if he/she has come to fall under the preceding Article.
(2) The Prime Minister may dismiss an officer if he/she has come to fall under any of the items of Article 19 or if the Prime Minister otherwise finds that it is inappropriate for the officer to remain in office.
(Prohibition of Concurrent Holding of Positions by Officers)
Article 30 No officer (excluding the inspector) shall take office as an officer of a profit-making organization or personally engage in a profit-making business; provided, however, that this shall not apply when approval from the Prime Minister has been obtained.
(Restrictions on Right to Represent)
Article 31 The governor or deputy governors shall not have the right to represent with regard to any matters for which the interests of the Corporation and those of the governor or deputy governors conflict with each other. In this case, an inspector shall represent the Corporation.
(Appointment of Representative)
Article 31-2 The governor may appoint from among the employees of the Corporation a representative who shall have the authority to perform all judicial and non-judicial acts in connection with part of the operations of the Corporation.
(Appointment of Staff)
Article 32 Staff of the Corporation shall be appointed by the governor.
(Confidentiality Obligations of Officers, etc.)
Article 33 The provisions of Article 22 and Article 23 apply mutatis mutandis to officers and staff members.
Section 5 Operations
(Scope of Operations)
Article 34 The Corporation shall conduct the following operations in order to achieve the purpose prescribed in Article 1:
(i) collection of insurance premiums under the provisions of Section 2 of the following Chapter;
(ii) payment of insurance proceeds and provisional payment under the provisions of Section 3 of the following Chapter;
(iii) financial assistance and other operations under the provisions of Section 4 of the following Chapter;
(iv)-2 loan of funds under the provisions of Article 69-3;
(v) purchase of deposits and other claims under the provisions of Chapter IV;
(vi) operations of a financial administrator or a financial administrator's representative under the provisions of Article 78, paragraph (2);
(vii) management of a Bridge Bank and other operations under the provisions of Chapter VI;
(viii) purchase of Specified Claims That Are Difficult to Collect of a Financial Institution under the provisions of Chapter VI-2 and other operations under the provisions of said Chapter;
(ix) Subscription for Shares, etc. and other operations under the provisions of Chapter VII;
(x) Special Surveillance under the provisions of Chapter VII-2 and other operations under the provisions of said Chapter;
(xi) loan of funds under the provisions of Article 69-3 as applied mutatis mutandis pursuant to Article 127 or Article 128 or the provisions of Article 127-2 or Article 128-2 and purchase of assets under the provisions of Article 129;
(xii) submission of lists of depositors and other operations under the provisions of Section 4 of Chapter IV, Section 2 of Chapter V, and Section 2 of Chapter VI of the Act on Special Measures for Corporate Reorganization Proceedings and Other Insolvency Proceedings of Financial Institutions (Act No. 95 of 1996);
(xiii) operations of a bankruptcy trustee, provisional administrator, bankruptcy trustee representative, or provisional administrator representative appointed under the provisions of the Bankruptcy Act (Act No. 75 of 2004), a supervisor, trustee, provisional administrator, trustee representative, or provisional administrator representative appointed under the provisions of the Civil Rehabilitation Act (Act No. 225 of 1999), a trustee, trustee representative, provisional administrator, provisional administrator representative, or supervisor appointed under the provisions of the Corporate Reorganization Act (Act No. 154 of 2002), a trustee, trustee representative, provisional administrator, provisional administrator representative, or supervisor appointed under the provisions of the Act on Special Treatment of Corporate Reorganization Proceedings and Other Insolvency Proceedings of Financial Institutions, or a recognition trustee, provisional administrator, recognition trustee representative, or provisional administrator representative appointed under the provisions of the Act on Recognition of and Assistance for Foreign Insolvency Proceedings (Act No. 129 of 2000); and
(xiv) operations incidental to the operations listed in the preceding items.
(Entrustment of Operations)
Article 35 (1) The Corporation may, with the authorization of the Prime Minister and the Minister of Finance, entrust part of its operations to the Bank of Japan, a Financial Institution, etc. (meaning the Financial Institution, etc. prescribed in Article 126-2, paragraph (2); hereinafter the same shall apply in this Article, Article 122, paragraph (1), Article 123, paragraphs (2) and (3), and Article 125, paragraph (1)), or a Financial Institution Agent (meaning a bank agent prescribed in Article 2, paragraph (15) of the Banking Act, Long-Term Credit Bank agent prescribed in Article 16-5, paragraph (3) of the Long-Term Credit Bank Act, shinkin bank agent prescribed in Article 85-2, paragraph (3) of the Shinkin Bank Act, credit cooperative agent prescribed in Article 6-3, paragraph (3) of the Act on Financial Business by Cooperatives (Act No. 183 of 1949), labor bank agent prescribed in Article 89-3, paragraph (3) of the Labor Bank Act (Act No. 227 of 1953) and the other party to contracts pertaining to the agency or intermediary prescribed in Article 2, paragraph (4) of The Shoko Chukin Bank Limited Act; the same shall apply hereinafter).
(2) The Bank of Japan, a Financial Institution, etc., and a Financial Institution Agent may conduct operations entrusted under the preceding paragraph notwithstanding the provisions of any other Acts.
(3) The provisions of Article 23 apply mutatis mutandis to officers or staff of a Financial Institution, etc. or Financial Institution Agent engaged in the operations entrusted to such Financial Institution or Financial Institution Agent under paragraph (1).
(Statement of Operation Procedures)
Article 36 (1) The Corporation shall prepare a statement of operation procedures when commencing operations and obtain the authorization of the Prime Minister and the Minister of Finance. The same shall apply when the Corporation intends to amend such statement.
(2) The statement of operation procedures prescribed in the preceding paragraph shall state matters concerning insurance premiums and other matters specified by Cabinet Office Ordinance and Ordinance of the Ministry of Finance.
(Request for Submission of Reports or Materials, etc.)
Article 37 (1) When the Corporation finds it necessary for conducting the operations set forth in the following items, it may request the persons specified respectively in those items to submit reports or materials with regard to the status of its business and property:
(i) operations prescribed in Article 34, items (i), (ii), (iv) through (vi), (viii), or (xii), or operations prescribed in item (xiv) of said Article pertaining to these operations: a Financial Institution (including a Financial Institution Agent having said Financial Institution as its Principal Financial Institution (meaning the principal bank prescribed in Article 2, paragraph (16) of the Banking Act, principal long-term credit bank prescribed in Article 16-5, paragraph (3) of the Long-Term Credit Bank Act, principal shinkin bank prescribed in Article 85-2, paragraph (3) of the Shinkin Bank Act, principal credit cooperative prescribed in Article 6-3, paragraph (3) of the Act on Financial Business by Cooperatives, and principal labor bank prescribed in Article 89-3, paragraph (3) of the Labor Bank Act; the same shall apply hereinafter) and the other party to a contract pertaining to the agency or intermediary prescribed in Article 2, paragraph (4) of the Shoko Chukin Bank Limited Act; the same shall apply in the following item);
(ii) operations prescribed in Article 34, item (iii), (vii), or (ix), or operations prescribed in item (xiv) of said Article pertaining to these operations: a Financial Institution or Bank Holding Company, etc.; and
(iii) operations prescribed in Article 34, item (x), (xi), or (xiii), or operations prescribed in item (xiv) of said Article pertaining to these operations: a Financial Institution, etc. (meaning the Financial Institution, etc. prescribed in Article 126-2, paragraph (2), and including a Financial Institution Agent having said Financial Institution, etc. as its Principal Financial Institution and the other party to a contract pertaining to the agency or intermediary prescribed in Article 2, paragraph (4) of the Shoko Chukin Bank Limited Act, a Life Insurance Agent (meaning the life insurance agent prescribed in Article 2, paragraph (19) of the Insurance Business Act (Act No. 105 of 1995); the same shall apply hereinafter) and Non-Life Insurance Agent (meaning the non-life insurance agent prescribed in Article 2, paragraph (20) of the Insurance Business Act; the same shall apply hereinafter) having said Financial Institution, etc. as their Affiliated Insurance Company, etc. (meaning the affiliated insurance company, etc. prescribed in Article 2, paragraph (24) of the Insurance Business Act; the same shall apply hereinafter), and a Financial Instruments Intermediary Service Provider (meaning the financial instruments intermediary service provider prescribed in Article 2, paragraph (12) of the Financial Instruments and Exchange Act (Act No. 25 of 1948); the same shall apply hereinafter) having said Financial Institution, etc. as its Entrusting Financial Instruments Business Operator, etc. (meaning the entrusting financial instruments business operator, etc. prescribed in Article 66-2, paragraph (1), item (iv) of the Financial Instruments and Exchange Act; the same shall apply hereinafter); the same shall apply in the following paragraph), or a Specified Holding Company, etc. (meaning the Specified Holding Company, etc. prescribed in Article 126-28, paragraph (1); the same shall apply in the following paragraph).
(2) A Financial Institution, etc. or Specified Holding Company, etc. shall submit reports or materials without delay when requested to do so under the preceding paragraph.
(3) The Corporation may request any of the following persons (in the event that the persons set forth in items (iii) and (iv) are corporations, any of their officers and employees; hereinafter referred to as a "Target Person" in this paragraph) and a person who was previously a Target Person to report on the status of business and property of the Failed Financial Institution or Financial Institution, etc. under Special Surveillance (meaning the Financial Institution, etc. under Special Surveillance prescribed in Article 126-3, paragraph (2), and excluding a Failed Financial Institution; hereinafter the same shall apply in this paragraph) (with regard to any person who was previously a Target Person, limited to the status pertaining to matters that could have been known by him/her during the period when he/she was engaged in the operations of the Failed Financial Institution or Financial Institution, etc. under Special Surveillance), or inspect the books, documents, and any other items of the Failed Financial Institution or Financial Institution, etc. under Special Surveillance and the person set forth in item (iii) or (iv):
(i) a director, executive officer, accounting advisor, inspector, corporate auditor, accounting auditor, manager, counselor, or any other employee of a Failed Financial Institution;
(ii) a director, executive officer, member who executes business, representative in Japan, accounting advisor, inspector, corporate auditor, or a person equivalent to any of these, accounting auditor, manager, counselor, or any other employee of a Financial Institution, etc. under Special Surveillance;
(iii) a Financial Institution Agent having a Failed Financial Institution as its Principal Financial Institution or the other party to a contract pertaining to the agency or intermediary prescribed in Article 2, paragraph (4) of the Shoko Chukin Bank Limited Act of The Shoko Chukin Bank, Ltd (limited to the case where it is a Failed Financial Institution); and
(iv) a Financial Institution Agent having a Financial Institution, etc. under Special Surveillance as its Principal Financial Institution or the other party to a contract pertaining to the agency or intermediary prescribed in Article 2, paragraph (4) of the Shoko Chukin Bank Limited Act of The Shoko Chukin Bank, Ltd (limited to the case where it is a Financial Institution, etc. under Special Surveillance), a Life Insurance Agent or Non-Life Insurance Agent having a Financial Institution, etc. under Special Surveillance as its Affiliated Insurance Company, etc., or a Financial Instruments Intermediary Service Provider having a Financial Institution, etc. under Special Surveillance as its Entrusting Financial Instruments Business Operator, etc.
(4) When the Corporation finds it necessary for conducting its operations, it may inquire with, or request the cooperation of, government agencies, public entities, or any other person.
(5) The national or prefectural government or the Bank of Japan may deliver relevant materials to the Corporation or make them available for inspection by the Corporation when the Corporation finds it particularly necessary for conducting its operations and makes a request for such delivery or inspection.
Section 6 Finance and Accounting
(Business Year)
Article 38 The business year of the Corporation shall be from April 1 to March 31 of the following year.
(Authorization for Budget, etc.)
Article 39 The Corporation shall prepare a budget and funding plan for each business year and obtain the authorization of the Prime Minister and the Minister of Finance before the start of that business year. The same shall apply when the Corporation intends to amend such budget and/or funding plan.
(Financial Statements, etc.)
Article 40 (1) The Corporation shall prepare an inventory of property, balance sheet, and profit and loss statement (hereinafter referred to as "Financial Statements" in this Article) for each business year and submit the Financial Statements for approval to the Prime Minister and the Minister of Finance within three months of the end of that business year.
(2) When submitting the Financial Statements to the Prime Minister and the Minister of Finance under the preceding paragraph, the Corporation shall attach thereto a business report, statement of accounts prepared according to the classification of budget, and written opinion of the inspector on the Financial Statements and statement of accounts for that business year.
(3) Upon obtaining approval from the Prime Minister and the Minister of Finance pursuant to the provisions of paragraph (1), the Corporation shall give public notice of the Financial Statements in the official gazette without delay, keep at each of the Corporation's offices the Financial Statements and supplementary schedules, business report, statement of accounts, and written opinion of the inspector prescribed in the preceding paragraph, and make them available for public inspection for a period specified by Cabinet Office Ordinance and Ordinance of the Ministry of Finance.
(Separate Accounting)
Article 40-2 The Corporation shall separate the accounting and prepare separate accounts for each of the following operations:
(i) operations listed in each item of Article 34 (excluding those listed in the following item); and
(ii) operations pertaining to the Subscription for Shares, etc. prescribed in Article 107, paragraph (1), receipt of contributions pursuant to the provisions of Article 122, paragraph (1), operations pertaining to loan of funds and guarantee of obligations under Article 126-19, paragraph (1), operations pertaining to Subscription for Specified Shares, etc. (meaning the Subscription for Specified Shares, etc. prescribed in Article 126-22, paragraph (1); the same shall apply in Article 126-2, paragraph (1), item (i) and Article 126-21, paragraph (1)) under Article 107, paragraph (1) as applied mutatis mutandis pursuant to Article 126-22, paragraph (7), operations pertaining to Specified Financial Assistance (meaning the Specified Financial Assistance prescribed in Article 126-28, paragraph (1); the same shall apply in Article 126-2, paragraph (1), item (ii)) based on the decision set forth in Article 64, paragraph (1) as applied mutatis mutandis pursuant to Article 126-31 or Article 126-38, paragraph (7), operations pertaining to the Additional Specified Financial Assistance prescribed in Article 126-32, paragraph (1) based on the decision set forth in Article 64, paragraph (1) as applied mutatis mutandis pursuant to Article 126-32, paragraph (4), operations pertaining to contribution under Article 126-35, paragraph (1) or (2), operations pertaining to loan of funds and guarantee of obligations under Article 98, paragraph (1) as applied mutatis mutandis pursuant to Article 126-37, operations pertaining to compensation for loss under Article 99 as applied mutatis mutandis pursuant to Article 126-37, collection of Specified Contribution (meaning the Specified Contribution prescribed in Article 126-39, paragraph (1); the same shall apply in Articles 123 through 125) under said paragraph, operations pertaining to loan of funds under Article 127-2, paragraph (1) or Article 128-2, paragraph (1), operations pertaining to purchase of assets (limited to those pertaining to the Financial Institution, etc. under Special Surveillance prescribed in Article 126-3, paragraph (2) and a Contracted Specified Bridge Financial Institution, etc. (meaning the Contracted Specified Bridge Financial Institution, etc. prescribed in Article 97, paragraph (1), item (i) as applied mutatis mutandis pursuant to Article 126-37; the same shall apply hereinafter)) under Article 129, paragraph (1), and operations incidental thereto.
(Accumulation of Liability Reserve)
Article 41 At the end of each business year, the Corporation shall calculate a liability reserve for the general account (meaning the account pertaining to operations listed in item (i) of the preceding Article; the same shall apply hereinafter) to be set aside pursuant to the provisions of Cabinet Office Ordinance and Ordinance of the Ministry of Finance.
(Borrowing and Deposit Insurance Corporation Bonds)
Article 42 (1) The Corporation may, with the authorization of the Prime Minister and the Minister of Finance, borrow funds (including refinancing) from a Financial Institution or any other person (excluding the Bank of Japan) or issue Deposit Insurance Corporation bonds (hereinafter referred to as "Corporation Bonds") (including issuance for the purpose of refinancing Corporation Bonds) when the Corporation finds it necessary for conducting the operations listed in Article 40-2, item (i). In this case, the Corporation may issue Corporation Bonds.
(2) The Corporation may, with the authorization of the Prime Minister and the Minister of Finance, borrow funds (including refinancing) from the Bank of Japan when the Corporation finds it necessary for temporary cash flow in the event of conducting the operations prescribed in the preceding paragraph.
(3) The total of the current amount of borrowing carried out under paragraph (1), the current amount of obligations pertaining to the principal of the Corporation Bonds issued under that paragraph, and the current amount of borrowing carried out under the preceding paragraph shall not exceed the limit specified by Cabinet Order.
(4) Notwithstanding the provisions of Article 43, paragraph (1) of the Bank of Japan Act (Act No. 89 of 1997), the Bank of Japan may loan funds prescribed in paragraph (2) to the Corporation.
(5) Holders of the Corporation Bonds issued under paragraph (1) shall have the right to have their claims satisfied out of the assets of the Corporation in preference over other creditors.
(6) The order of the statutory lien under the preceding paragraph shall be next to the general statutory lien under the provisions of the Civil Code (Act No. 89 of 1896).
(7) The Corporation may, with the authorization of the Prime Minister and the Minister of Finance, entrust all or part of the affairs relating to the issuance of the Corporation Bonds to a Bank, etc. or trust company.
(8) The provisions of Article 705 or Article 709 of the Companies Act apply mutatis mutandis to the Bank, etc. or trust company entrusted pursuant to the provisions of the preceding paragraph.
(9) In addition to what is provided for in paragraph (1) and paragraph (5) to the preceding paragraph, necessary matters for the Corporation Bonds shall be specified by Cabinet Order.
(Government Guarantee)
Article 42-2 Notwithstanding the provisions of Article 3 of the Act on Restrictions on Government Financial Assistance for Corporations (Act No. 24 of 1946), the government may provide guarantees for obligations pertaining to the borrowing by the Corporation under paragraph (1) or (2) of the preceding Article or Corporation Bonds under paragraph (1) of the preceding Article within the limit of the amount approved by the Diet.
(Investment of Surplus Funds)
Article 43 The Corporation shall not invest surplus funds from operations except by the following methods:
(i) holding of national government bonds or other securities designated by the Prime Minister and the Minister of Finance;
(ii) deposits in the Financial Institutions designated by the Prime Minister and the Minister of Finance; or
(iii) other methods specified by Cabinet Office Ordinance and Ordinance of the Ministry of Finance.
(Delegation to Cabinet Office Ordinance and Ordinance of the Ministry of Finance)
Article 44 In addition to what is provided for in this Act, necessary matters for the finance and accounting of the Corporation shall be specified by Cabinet Office Ordinance and Ordinance of the Ministry of Finance.
Section 7 Supervision
(Supervision)
Article 45 (1) The Corporation shall be supervised by the Prime Minister and the Minister of Finance.
(2) The Prime Minister and the Minister of Finance may, when they find it necessary for the enforcement of this Act, give the Corporation orders necessary for the supervision of its operations.
(Report and Inspection)
Article 46 (1) The Prime Minister and the Minister of Finance may, when they find it necessary for the enforcement of this Act, have the Corporation report on its operations or have their officials enter the offices of the Corporation to inspect books, documents and other items.
(2) When conducting on-site inspections under the preceding paragraph, the officials shall carry a certificate of identification and produce it to those concerned.
(3) The authority for conducting on-site inspections prescribed in paragraph (1) shall not be construed as given for any criminal investigation.
Section 8 Auxiliary Provisions
(Amendments of Articles of Incorporation)
Article 47 No amendment of the articles of incorporation shall be effective unless authorized by the Prime Minister and the Minister of Finance.
(Dissolution)
Article 48 (1) If, upon dissolution of the Corporation and payment of all its obligations, there are any residual assets, such assets shall be distributed to each capital contributor of the Corporation up to the amount of each contributor's capital contributions.
(2) In addition to what is provided for in the preceding paragraph, the dissolution of the Corporation shall be prescribed separately by an Act.
Chapter III Deposit Insurance
Section 1 Insurance Relationship
(Insurance Relationship)
Article 49 (1) When a Financial Institution conducts its operations or business, an insurance relationship shall be formed between the Corporation, Financial Institution and Depositors, etc. whereby each of the Depositors, etc. shall be repaid within a specified limit by virtue of the obligations pertaining to the Deposits, etc. assumed by the Financial Institution.
(2) Under the insurance relationship prescribed in the preceding paragraph, the insured amount shall be taken as a claim pertaining to the Deposits, etc. and either of the following shall be construed as an insurable contingency:
(i) suspension of repayment of the Deposits, etc. by a Financial Institution (hereinafter referred to as "Category One Insurable Contingency"); and
(ii) rescission of business license of a Financial Institution (in the case of a shinkin bank, federation of shinkin banks, labor bank, or federation of labor banks, rescission of operational license, and in the case of a credit cooperative or Federation of Credit Cooperatives, an order for dissolution; the same shall apply in Article 55, paragraph (2), item (i)), a ruling for the commencement of bankruptcy proceedings or resolution on dissolution (hereinafter referred to as "Category Two Insurable Contingency").
Section 2 Payment of Insurance Premiums
(Payment, etc. of Insurance Premiums)
Article 50 (1) A Financial Institution shall submit to the Corporation documents specified by Cabinet Office Ordinance and Ordinance of the Ministry of Finance and pay insurance premiums for each business year within three months of the beginning of that business year; provided, however, that an amount equivalent to one-half of the amount of said insurance premiums may be paid within three months of the day on which six months have elapsed from the beginning of that business year.
(2) Notwithstanding the provisions of the preceding paragraph, the Corporation may, pursuant to the provisions of the articles of incorporation, exempt a Financial Institution falling under any of the following items from paying insurance premiums:
(i) when an insurable contingency has occurred: the Financial Institution pertaining to the insurable contingency;
(ii) when authorization of eligibility, etc. prescribed in Article 65 is given: the Failed Financial Institution pertaining to the authorization of eligibility, etc.;
(iii) when a Injunction Ordering Management prescribed in Article 74, paragraph (1) is issued: the Financial Institution under Management pertaining to the Injunction Ordering Management;
(iv) when a Bridge Bank or Specified Bridge Bank (meaning the Specified Bridge Bank prescribed in Article 126-34, paragraph (3), item (i); the same shall apply in Article 101-2, paragraph (1)) is established: the Bridge Bank or the Specified Bridge Bank; or
(v) when a decision under Article 111, paragraph (1) is made: the Bank, etc. pertaining to the decision.
(3) The Corporation may, following a resolution of the Policy Board and based on the conditions specified by the Policy Board in advance, return to a Financial Institution part of the insurance premiums that have been paid pursuant to paragraph (1).
(4) When the Corporation intends to return part of the insurance premiums that have been paid pursuant to paragraph (1), it shall obtain the authorization of the Prime Minister and the Minister of Finance.
(Amount of Insurance Premiums Pertaining to General Deposits, etc.)
Article 51 (1) The amount of insurance premiums pertaining to Deposits, etc. (limited to those that are not Deposits for payment and settlement purposes (meaning the Deposits for payment and settlement purposes prescribed in paragraph (1) of the following Article; the same shall apply in the following paragraph) but excluding foreign currency deposits and other Deposits, etc. specified by Cabinet Order; hereinafter referred to as "General Deposits, etc.") shall be the amount calculated for each Financial Institution by dividing the average total amount of General Deposits, etc. for each day (excluding holidays specified in Article 15, paragraph (1) of the Banking Act (including the cases where it is applied mutatis mutandis pursuant to Article 17 of the Long-Term Credit Bank Act, Article 89, paragraph (1) of the Shinkin Bank Act, Article 6, paragraph (1) of the Act on Financial Business by Cooperatives, and Article 94, paragraph (1) of the Labor Bank Act) or Article 31, paragraph (1) of The Shoko Chukin Bank Limited Act; the same shall apply in paragraph (1) of the following Article) of the business year immediately preceding the business year including the day on which said insurance premiums are to be paid by twelve, multiplied by the number of months in the business year including the day on which the said insurance premiums are to be paid, and multiplying the amount thus calculated by a rate determined by the Corporation following a resolution by the Policy Board (hereinafter referred to as "Insurance Premiums Rate" in this Article).
(2) The Insurance Premiums Rate shall be established such that the Corporation's long-term finances will be balanced in light of the estimated amount of expenses (excluding those pertaining to Deposits for payment and settlement purposes) to be incurred through payment of insurance proceeds, financial assistance and other operations of the Corporation (except those listed in Article 40-2, item (ii)) and that no specific Financial Institution will be subject to any discriminatory treatment (except that which is applied according to the soundness of management of a Financial Institution).
(3) When the Corporation finds it difficult to repay any funds borrowed under Article 42, paragraph (1) or (2) or to redeem the Corporation Bonds issued under Article 42, paragraph (1), the Corporation shall change the Insurance Premiums Rate following a resolution by the Policy Board.
(4) When the Corporation intends to establish or change the Insurance Premiums Rate, the Corporation shall obtain the authorization of the Prime Minister and the Minister of Finance.
(5) Upon receiving the authorization set forth in the preceding paragraph, the Corporation shall give public notice of the Insurance Premiums Rate pertaining to the authorization without delay.
(Amount of Insurance Premiums Pertaining to Deposits for payment and settlement purposes)
Article 51-2 (1) The amount of insurance premiums pertaining to deposits that satisfy all of the following requirements (excluding foreign currency deposits and other deposits specified by Cabinet Order; hereinafter referred to as "Deposits for payment and settlement purposes") shall be the amount calculated for each Financial Institution by dividing the total average amount of Deposits for payment and settlement purposes for each day of the business year immediately preceding the business year including the day on which said insurance premiums are to be paid by twelve, multiplied by the number of months in the business year including the day on which the said insurance premiums are to be paid, and multiplying the amount thus calculated by a rate determined by the Corporation following a resolution by the Policy Board:
(i) the deposits can be used for a transaction specified by Cabinet Order as prescribed in Article 69-2, paragraph (1) based on the contract or practice of such transaction;
(ii) the deposits are repayable to their depositors on demand; and
(iii) the deposits bear no interest.
(2) The provisions of paragraphs (2) to (5) of the preceding Article apply mutatis mutandis to the rate prescribed in the preceding paragraph. In this case, the term "excluding those pertaining to" in paragraph (2) of the preceding Article shall be deemed to be replaced with "limited to those pertaining to."
(Late Payment Charge)
Article 52 (1) A Financial Institution shall pay a late payment charge to the Corporation in the event that such Financial Institution fails to pay insurance premiums by the due date.
(2) The amount of the late payment charge shall be an amount calculated by multiplying the amount of unpaid insurance premiums by 14.5% per annum prorated for the number of days from the day following the due date of payment until the day of payment.
Section 3 Payment of Insurance Claims, etc.
(Payment of Insurance Claims, etc.)
Article 53 (1) When an insurable contingency has occurred, the Corporation shall pay insurance proceeds to Depositors, etc. pertaining to the insurable contingency based on a request by said Depositors, etc.; provided, however, that any payment of claims for Category One Insurable Contingencies shall be conditional upon a decision by the Corporation to pay said amounts under the provisions of Article 56, paragraph (1).
(2) The insurable contingency prescribed in the preceding paragraph shall not include any other insurable contingency occurring thereafter (in the event that the proviso to the preceding paragraph applies, after the Corporation has made a decision referred to in said proviso) in relation to said insurable contingency with respect to the Financial Institution subject to said insurable contingency (referred to as "Related Insurable Contingency" in Article 57, paragraph (1), item (ii)).
(3) The Corporation may pay insurance proceeds by depositing with a Financial Institution an amount equivalent to the insurance proceeds of each of the Depositors, etc. pertaining to said insurable contingency and by transferring the claims pertaining to said deposits to the Depositors, etc. pertaining to said insurable contingency.
(4) When an insurable contingency has occurred, the Corporation may, based on a request by Depositors, etc. pertaining to said insurable contingency, make a provisional payment to such Depositors, etc. in accordance with Cabinet Order within an amount specified by Cabinet Order.
(5) The request prescribed in paragraph (1) or the preceding paragraph may only be made within the payment period for which public notice was given under Article 57, paragraph (1), (2) or (4); provided, however, that this shall not apply at the time of a natural disaster or when the Corporation finds any other unavoidable reason for the failure to make the request within the payment period.
(Amount of Insurance Claims, etc. Pertaining to General Deposits, etc.)
Article 54 (1) The amount of insurance proceeds pertaining to the General Deposits, etc. (excluding those held under the name of another person and other General Deposits, etc. specified by Cabinet Order; hereinafter referred to as "Covered General Deposits, etc.") of each of the Depositors, etc. in a Financial Institution subject to a single insurable contingency shall be an amount equivalent to the aggregate amount (if there is more than one aggregate amount for the same person, the total of such amounts) of the principal (in the case of the money specified in Article 2, paragraph (2), item (v) within the Covered General Deposits, etc., the amount of such money; the same shall apply hereinafter) and interest, etc. (meaning the portion that is not the principal but is interest and other items specified by Cabinet Order; the same shall apply hereinafter) of the claims pertaining to the Covered General Deposits, etc. actually held by said person in said Financial Institution on the day of occurrence of said insurable contingency (limited to those actually held by said person at the time of making a request under paragraph (1) of the preceding Article and including those no longer held due to the provisional payment under paragraph (4) of the preceding Article (limited to those pertaining to the Covered General Deposits, etc.; hereinafter the same shall apply in this Article) and the repayment of the Covered General Deposits, etc. pertaining to the loan under Article 69-3, paragraph (1) or as applied mutatis mutandis pursuant to Article 127; the same shall apply in the following paragraph).
(2) If the amount of principal (if there is more than one amount for the same person, the total of such amounts) under the preceding paragraph exceeds an amount specified by Cabinet Order (hereinafter referred to as "Base Insurance Amount"), the amount of insurance proceeds pertaining to the Covered General Deposits, etc. shall be the total of the Base Insurance Amount and the amount of interest, etc. pertaining to the principal corresponding to the Base Insurance Amount. In this case, if there is more than one amount of principal for the same person, the principal corresponding to the Base Insurance Amount shall be the total of the amounts of principal prescribed in the following items up to the Base Insurance Amount:
(i) when there are claims pertaining to the Covered General Deposits, etc., some of which are the subject matter of a security interest and others are not, the principal pertaining to those that are not the subject matter of a security interest shall have priority;
(ii) when two or more claims pertaining to the Covered General Deposits, etc., which are not the subject matter of a security interest, are held by the same person, the principal pertaining to those with an earlier due date shall have priority;
(iii) in the case referred to in the preceding item, if two or more claims with the same due date pertaining to the Covered General Deposits, etc. are held by the same person, the principal pertaining to those with a lower interest rate (meaning the rate of interest and other similar matters specified by Cabinet Order; the same shall apply in the following item) shall have priority;
(iv) in the case referred to in the preceding item, if two or more claims with the same interest rate pertaining to the Covered General Deposits, etc. are held by the same person, the principal pertaining to those designated by the Corporation shall have priority; and
(v) when two or more claims pertaining to the Covered General Deposits, etc., which are the subject matter of a security interest, are held by the same person, the principal pertaining to those designated by the Corporation shall have priority.
(3) Notwithstanding the provisions of the preceding two paragraphs, in the event that any of the Depositors, etc. pertaining to an insurable contingency have received provisional payment under paragraph (4) of the preceding Article or repayment of the Covered General Deposits, etc. pertaining to the loan under Article 69-3, paragraph (1) as applied mutatis mutandis pursuant to Article 127 with respect to said insurable contingency, the amount of insurance proceeds for the Covered General Deposits, etc. of said person shall be reduced by the amount of said provisional payment and repayment of the Covered General Deposits, etc. pertaining to the loan under Article 69-3, paragraph (1) as applied mutatis mutandis pursuant to Article 127 (excluding any amount to be repaid to the Corporation under the following paragraph) pursuant to the provisions of Cabinet Order concerning the amounts prescribed in these provisions.
(4) When the amount of provisional payment made under paragraph (4) of the preceding Article to any of the Depositors, etc. pertaining to an insurable contingency exceeds an amount calculated pursuant to the provisions of Cabinet Order within the amounts of insurance proceeds prescribed in paragraph (1) and (2), said persons shall repay to the Corporation the amount of such excess.
(Amount of Insurance Claims Pertaining to Deposits for payment and settlement purposes)
Article 54-2 (1) The amount of insurance proceeds pertaining to the Deposits for payment and settlement purposes (excluding those held under the name of another person and other Deposits for payment and settlement purposes specified by Cabinet Order; hereinafter referred to as "Covered Deposits for Settlement") of each of the Depositors, etc. in a Financial Institution subject to a single insurable contingency shall be an amount equivalent to the amount of principal (if there is more than one amount for the same person, the total of such amounts) of the claims pertaining to the Covered Deposits for payment and settlement purposes actually held by said Depositors, etc. in said Financial Institution on the day of occurrence of said insurable contingency (limited to those actually held by said Depositors, etc. at the time of making a request under Article 53, paragraph (1) and including those no longer held due to the provisional payment under Article 53, paragraph (4) (limited to those pertaining to the Covered Deposits for Settlement; the same shall apply in the following paragraph) or repayment of the Covered Deposits for Settlement pertaining to the loan under Article 69-3, paragraph (1) (including the cases where it is applied mutatis mutandis pursuant to Article 127; the same shall apply in the following paragraph)).
(2) The provisions of paragraph (3) of the preceding Article apply mutatis mutandis to cases where the Depositors, etc. pertaining to an insurable contingency have received, with regard to the Covered Deposits for Settlement held thereby, the provisional payment under Article 53, paragraph (4) or repayment of the Covered Deposits for payment and settlement purposes pertaining to the loan under Article 69-3, paragraph (1) with respect to said insurable contingency. In this case, the terms "Notwithstanding the provisions of the preceding two paragraphs" and "these provisions" in paragraph (3) of the preceding Article shall be deemed to be replaced with "Notwithstanding the provisions of Article 54-2, paragraph (1)" and "said provisions."
(Special Provisions for Deposits, etc. Pertaining to Defined Contribution Pension)
Article 54-3 (1) In the event that any of the Depositors, etc. of a Financial Institution subject to a single insurable contingency is an Asset Management Institution (limited to the trustee of a trust prescribed in Article 8, paragraph (1), item (i) of the Defined Contribution Pension Act (Act No. 88 of 2001)) prescribed in Article 2, paragraph (7), item (i), (b) of said Act, an Association prescribed in Article 2, paragraph (5) of said Act, or a trustee (limited to trust companies (including the Financial Institutions engaged in trust operations)) of affairs prescribed in Article 61, paragraph (1), item (iii) of said Act (hereinafter referred to as "Asset Management Institution, etc."), the amount of insurance proceeds of said person shall, notwithstanding the provisions of the Insurance Claim Calculation Provision, be the remaining amount after deducting the amount specified in item (ii) from the amount specified in item (i), adding thereto the amount specified in item (iii):
(i) with regard to claims pertaining to the covered Deposits, etc. (meaning the Covered General Deposits, etc. or Covered Deposits for payment and settlement purposes; the same shall apply hereinafter) of said Asset Management Institution, etc. (limited to those actually held by the Depositors, etc. holding said covered Deposits, etc. at the time of making a request under Article 53, paragraph (1) and including those no longer held due to the provisional payment under Article 53, paragraph (4) or repayment of the covered Deposits, etc. pertaining to the loan under Article 69-3, paragraph (1) (including the cases where it is applied mutatis mutandis pursuant to Article 127); hereinafter the same shall apply in this Article) that pertain to the investment of reserves of defined contribution pensions (meaning the reserves prescribed in Article 8, paragraph (1) of the Defined Contribution Pension Act; hereinafter the same shall apply in this Article), the total of the amounts that are deemed to be the amount of insurance proceeds for each of the subscribers, etc. (meaning the subscribers, etc. prescribed in Article 2, paragraph (7), item (i), (a) of said Act; hereinafter the same shall apply in this Article) who have instructed said investment, when the Insurance Claim Calculation Provision is applied in the event that, within the claims pertaining to the covered Deposits, etc. actually held by said Asset Management Institution, etc. in said Financial Institution on the day of occurrence of said insurable contingency (hereinafter referred to as "Insurable Contingency Date" in this paragraph), those portions that are equivalent to the amount of managed assets per individual (meaning the amount of managed assets per individual prescribed in Article 2, paragraph (13) of said Act) of said subscribers, etc. (referred to as "Deposit Claims Equivalent to Amount of Managed Assets Per Individual" in the following paragraph) are deemed to be claims pertaining to the covered Deposits, etc. of said subscribers, etc.;
(ii) the total of the amounts of insurance proceeds under the Insurance Claim Calculation Provision with respect to each of the claims pertaining to the covered Deposits, etc. actually held by said subscribers, etc. in said Financial Institution on the Insurable Contingency Date; and
(iii) the amount of insurance proceeds under the Insurance Claim Calculation Provision other than those pertaining to the investment of the reserves of defined contribution pensions, within the claims pertaining to the covered Deposits, etc. actually held by said Asset Management Institution, etc. in said Financial Institution on the Insurable Contingency Date.
(2) In the event that the provisions of Article 54, paragraph (2) are applied under item (i) of the preceding paragraph, the principal corresponding to Base Insurance Amount shall be the total of the amounts of principal prescribed in the following items up to the Base Insurance Amount:
(i) when there are Deposit Claims Equivalent to Amount of Managed Assets Per Individual of subscribers, etc., within the claims pertaining to the covered Deposits, etc. of said subscribers, etc. and those of said Asset Management Institution, etc. before the application of the provisions of item (i) of the preceding paragraph, the principal of the claims pertaining to the covered Deposits, etc. of said subscribers, etc. shall have priority; and
(ii) when there are two or more Deposit Claims Equivalent to Amount of Managed Assets Per Individual of subscribers, etc. within the claims pertaining to the covered Deposits, etc. of said Asset Management Institution, etc., the principal pertaining to those designated by the Corporation shall have priority.
(3) In the case referred to in paragraph (1), if the payment of insurance proceeds is made to an Asset Management Institution, etc. under Article 53, paragraph (1), the amount after deducting the amount specified in paragraph (1), item (ii) from the amount specified in paragraph (1), item (i) pertaining to subscribers, etc. within said insurance proceeds shall be deemed to be reserved in the managed assets per individual (meaning the managed assets per individual prescribed in Article 2, paragraph (12) of the Defined Contribution Pension Act) of said subscribers, etc.
(4) In applying the provisions of Article 2, paragraph (11) in the case referred to in paragraph (1), the term "and Article 54-2, paragraph (1)" in Article 2, paragraph (11) shall be taken as meaning ", Article 54-2, paragraph (1), and Article 54-3, paragraphs (1) and (2)."
(Notice of Insurable Contingency)
Article 55 (1) A Financial Institution shall immediately notify the Corporation upon the occurrence of an insurable contingency pertaining to the Financial Institution.
(2) The Prime Minister, the Minister of Finance, the Minister of Health, Labour and Welfare, or the Minister of Economy, Trade and Industry shall immediately notify the Corporation upon the occurrence of any of the following events:
(i) when they have rescinded the business license of, or passed a resolution on the authorization to dissolve, a Financial Institution under their supervision;
(ii) when they have become aware that a Financial Institution under their supervision has become subject to Category One Insurable Contingency; and
(iii) when they have received notice under Article 137-2, paragraph (1).
(3) Upon receiving notice under paragraph (1) or notice from the Minister of Health, Labour and Welfare or Minister of Economy, Trade and Industry under the preceding paragraph, the Corporation shall immediately report to that effect to the Prime Minister and the Minister of Finance.
(4) Upon receiving notice from the Prime Minister under paragraph (2), the Corporation shall immediately report to that effect to the Minister of Finance.
(5) Upon receiving notice from the Minister of Finance under paragraph (2), the Corporation shall immediately report to that effect to the Prime Minister.
(Ascertaining Amount of Claims Pertaining to Deposits, etc.)
Article 55-2 (1) Upon becoming aware that a Financial Institution has become subject to an insurable contingency, the Corporation shall promptly ascertain the amount of claims pertaining to the Deposits, etc. actually held in said Financial Institution as of the day of the occurrence of said insurable contingency by each of the Depositors, etc. of said Financial Institution.
(2) When the Corporation finds it necessary for promptly ascertaining the amount of claims pertaining to the Deposits, etc. prescribed in the preceding paragraph, the Corporation may, by clearly indicating to that effect, request the Financial Institution to submit materials concerning the names and addresses of the Depositors, etc., details of claims pertaining to the Deposits, etc. and other matters specified by Cabinet Office Ordinance and Ordinance of the Ministry of Finance.
(3) A Financial Institution shall, if requested to submit materials under the preceding paragraph, submit them without delay using electronic data processing systems or magnetic tapes (including any other medium in which certain matters can be securely recorded by equivalent means) pursuant to the provisions of Cabinet Office Ordinance and Ordinance of the Ministry of Finance.
(4) A Financial Institution shall prepare a database pertaining to the Deposits, etc. (meaning the collection of information pertaining to the Deposits, etc. that is systematically organized so that the information may be retrieved by using computers) and electronic data processing systems and take any other measures necessary for submitting materials under the preceding paragraph.
(Decision on Payment)
Article 56 (1) If any of the events listed in the following items occurs, the Corporation shall, following a resolution by the Policy Board, decide whether to pay insurance proceeds with respect to the insurable contingency prescribed in each of the following items within one month of the day specified in such item:
(i) when notice is received under Article 55, paragraph (1) or (2) concerning the Category One Insurable Contingency: the day on which the notice is received;
(ii) in addition to the case referred to in the preceding item, if the Corporation has become aware that the Category One Insurable Contingency has occurred: the day on which the Corporation has become aware of such occurrence;
(iii) when notice is received under Article 66, paragraph (1) to the effect that the resolution, decision, or consent prescribed in Article 66, paragraph (1) has failed to be obtained for a merger, the Business Transfer, etc., Transfer of Insured Deposits, share exchange, share transfer, or company split involving a Financial Institution subject to the Category One Insurable Contingency as a party thereto: the day on which the notice is received; and
(iv) in addition to the case referred to in the preceding item, if the Corporation has become aware that the resolution, decision, or consent prescribed in Article 66, paragraph (1) has failed to be obtained for a merger, Business Transfer, etc., Transfer of Insured Deposits, share exchange, share transfer, or company split involving a Financial Institution subject to the Category One Insurable Contingency as a party thereto: the day on which the Corporation has become aware of such fact.
(2) In the event that the Corporation applies for an extension of the time limit under the preceding paragraph following a resolution of the Policy Board, the Prime Minister and the Minister of Finance may grant the extension for a period not exceeding one month.
(3) If any of the events listed in the following items occurs, the Corporation shall, following a resolution of the Policy Board, decide whether to make provisional payment under Article 53, paragraph (4) with respect to an insurable contingency prescribed in each of the following items within one week of the day specified in such item:
(i) when notice is received under Article 55, paragraph (1) or (2) concerning an insurable contingency: the day on which the notice is received;
(ii) in addition to the case referred to in the preceding item, if the Corporation has become aware that an insurable contingency has occurred: the day on which the Corporation has become aware of such occurrence;
(iii) if notice is received under Article 66, paragraph (1) to the effect that the resolution, decision, or consent prescribed in Article 66, paragraph (1) has failed to be obtained for a merger, Business Transfer, etc., Transfer of Insured Deposits, share exchange, share transfer, or company split involving a Financial Institution subject to the Category One Insurable Contingency as a party thereto: the day on which the notice is received; and
(iv) in addition to the case referred to in the preceding item, if the Corporation has become aware that the resolution, decision, or consent prescribed in Article 66, paragraph (1) has failed to be obtained for a merger, Business Transfer, etc., Transfer of Insured Deposits, share exchange, share transfer, or company split involving a Financial Institution subject to the Category One Insurable Contingency as a party thereto: the day on which the Corporation has become aware of such fact.
(4) Upon making a decision under paragraph (1) or the preceding paragraph, the Corporation shall immediately report matters pertaining to the decision to the Prime Minister and the Minister of Finance (to the Prime Minister, the Minister of Finance, and the Minister of Health, Labour and Welfare if the decision relates to a labor bank or federation of labor banks, and to the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry if the decision relates to The Shoko Chukin Bank, Ltd.).
(Public Notice of Payment, etc.)
Article 57 (1) The Corporation shall, following a resolution of the Policy Board, promptly determine the period, place, and method of payment of insurance proceeds and other matters specified by Cabinet Order and give public notice thereof in the following cases:
(i) when the Corporation has made a decision under paragraph (1) of the preceding Article to pay insurance proceeds pertaining to the Category One Insurable Contingency;
(ii) when the Corporation has received notice under Article 55, paragraph (1) or (2) concerning the Category Two Insurable Contingency (excluding the Related Insurable Contingency; the same shall apply in the following item); and
(iii) in addition to the case referred to in the preceding item, if the Corporation has become aware that the Category Two Insurable Contingency has occurred.
(2) When the Corporation has made a decision pursuant to the provisions of paragraph (3) of the preceding Article to make provisional payment under Article 53, paragraph (4), the Corporation shall, following a resolution by the Policy Board, promptly determine the period, place, and method of payment of said provisional payment and other matters specified by Cabinet Order and give public notice thereof.
(3) If, after giving public notice under the preceding two paragraphs, there is public notice under Article 197, paragraph (1) of the Bankruptcy Act (including the cases where it is applied mutatis mutandis pursuant to Article 209, paragraph (3) of said Act), notice under Article 137-2, paragraph (2), or any other event specified by Cabinet Order with respect to said Financial Institution, the Corporation may, pursuant to the provisions of Cabinet Order, change the payment period that was publicly announced under the provisions of the preceding two paragraphs.
(4) When the Corporation has changed the payment period under the preceding paragraph, the Corporation shall give public notice of matters pertaining to said change without delay.
(5) The provisions of paragraph (4) of the preceding Article apply mutatis mutandis to cases where the matters prescribed in paragraph (1) or (2) have been decided and where the payment period has been changed under paragraph (3).
(Acquisition of Claims, etc.)
Article 58 (1) When a request is made for the payment of insurance proceeds under Article 53, paragraph (1), the Corporation shall, pursuant to the provisions of Cabinet Order, acquire claims pertaining to the covered Deposits, etc. held in a Financial Institution by the Depositors, etc. pertaining to said request, according to the amount of insurance proceeds that are required to be paid to said Depositors, etc. under the Insurance Claim Calculation Provision.
(2) When the claims pertaining to the covered Deposits, etc. acquired under the preceding paragraph include any claim that is subject to a security interest, the Corporation may, pursuant to the provisions of Cabinet Order, defer the payment of insurance proceeds up to an amount equivalent to the claim pertaining to the covered Deposits, etc. (limited to the portion that has been acquired by the Corporation) that are subject to said security interest until the extinction of the secured claim pertaining to said security interest.
(3) When the Corporation has made provisional payment to the Depositors, etc. under Article 53, paragraph (4), the Corporation shall, according to the amount of such payment (excluding the amount to be repaid to the Corporation under Article 54, paragraph (4)), acquire claims pertaining to the covered Deposits, etc. held in a Financial Institution by said Depositors, etc.
(Concerning Taxation)
Article 58-2 (1) In the event that Depositors, etc. receive payment of insurance proceeds in connection with claims pertaining to the covered Deposits, etc. (excluding those pertaining to the Long-Term Credit Bank Bonds, etc. issued by means of a discount, among those listed in Article 2, paragraph (2), item (v)) held by said Depositors, etc. (hereinafter referred to as "Deposits and Other Claims" in this paragraph), when the Deposits and Other Claims acquired by the Corporation according to the amount of insurance proceeds for which said payment is received include any interest, etc., an amount equivalent to said interest, etc. shall be deemed to be the amount prescribed in each of the following items according to the category of the covered Deposits, etc. pertaining to said Deposits and Other Claims prescribed in each respective item, in applying the provisions of the Income Tax Act (Act No. 33 of 1965) and other laws and regulations concerning income tax:
(i) deposits: interests on said deposits;
(ii) installment savings: compensation money for benefits (meaning the compensation money for benefits specified in Article 174, item (iii) of the Income Tax Act) based on contracts for said installment savings;
(iii) installment deposits specified in Article 2, paragraph (2), item (iii): compensation money for benefits (meaning the compensation money for benefits specified in Article 174, item (iv) of the Income Tax Act) based on contracts for said installment deposits;
(iv) money specified in Article 2, paragraph (2), item (iv): distribution of profits under money trusts prescribed in Article 2, paragraph (2), item (iv) pertaining to said money; and
(v) money specified in Article 2, paragraph (2), item (v): interests on the Long-Term Credit Bank Bonds, etc. (excluding those issued by means of a discount).
(2) In the event that the provisions of the preceding paragraph apply, any necessary matters for the application of special provisions for Article 4-2 and Article 4-3 of the Act on Special Measures Concerning Taxation (Act No. 26 of 1957) and other provisions of the preceding paragraph shall be specified by Cabinet Order.
(Measures for Payment of Insurance Claims, etc. Pertaining to Deposits, etc.)
Article 58-3 (1) A Financial Institution shall develop electronic data processing systems and take any other measures specified by Cabinet Office Ordinance in order to secure the smooth implementation of the payment of insurance proceeds pertaining to the Covered Deposits, etc. or repayment thereof and any other measures necessary for dealing with an insurable contingency in the event of occurrence of an insurable contingency.
(2) The Prime Minister may, when he/she finds that the measures prescribed in the preceding paragraph have not been taken, order a Financial Institution to take said measures to the extent necessary, by a specified time.
Section 4 Financial Assistance
(Application for Financial Assistance)
Article 59 (1) A Financial Institution undertaking a merger, etc. that is not a Failed Financial Institution (hereinafter referred to as an "Assuming Financial Institution") or a Bank Holding Company, etc. undertaking a merger, etc. (hereinafter referred to as an "Assuming Bank Holding Company, etc.") may apply to have the Corporation take the following measures (in the case of measures specified in item (vi), excluding those provided to the companies specified in Article 2, paragraph (5), item (v); hereinafter referred to as "Financial Assistance") to support the merger, etc.:
(i) donation of money;
(ii) loan or deposit of funds;
(iii) purchase of assets;
(iv) guarantee of obligations;
(v) assumption of obligations;
(vi) Subscription for Preferred Shares, etc.; and
(vii) Securing of Damage.
(2) The term "merger, etc." as used in the preceding paragraph means the following:
(i) a merger in which a Financial Institution that merges with a Failed Financial Institution survives;
(ii) a merger in which a Financial Institution is established through the merger of a Failed Financial Institution and another Financial Institution;
(iii) a Business Transfer, etc. in which a Failed Financial Institution transfers its business to another Financial Institution (in the case of transfer of part of the business, limited to one accompanied by the assumption of obligations pertaining to the Deposits, etc. of a Failed Financial Institution that include obligations pertaining to the Deposits, etc. corresponding to the amount of insurance proceeds calculated under the Insurance Claim Calculation Provision);
(iii)-2 Transfer of Insured Deposits;
(iv) an acquisition of shares of a Failed Financial Institution by another Financial Institution or Bank Holding Company, etc. to implement matters specified by the Prime Minister and the Minister of Finance as being necessary for ensuring sound and appropriate operation of said Failed Financial Institution;
(v) an absorption-type company split to which a Failed Financial Institution is a party where another Financial Institution succeeds to all or part of the rights and obligations held by the Failed Financial Institution in relation to its business through said absorption-type company split (in the case of an absorption-type company split where another Financial Institution succeeds to part of the rights and obligations, limited to one where another Financial Institution succeeds to obligations pertaining to the Deposits, etc. of the Failed Financial Institution and where the obligations include those pertaining to Deposits, etc. corresponding to the amount of insurance claims calculated under the Insurance Claim Calculation Provision); and
(vi) an incorporation-type company split to which a Failed Financial Institution is a party where the Financial Institution newly established through said incorporation-type company split succeeds to all or part of the rights and obligations held by the Failed Financial Institution in relation to its business through said incorporation-type company split (in the case of an incorporation-type company split where the newly established Financial Institution succeeds to part of the rights and obligations, limited to one where the newly established Financial Institution succeeds to obligations pertaining to the Deposits, etc. of the Failed Financial Institution and where the obligations include those pertaining to Deposits, etc. corresponding to the amount of insurance claims calculated under the Insurance Claim Calculation Provision).
(3) The Financial Assistance prescribed in paragraph (1) provided to support a merger specified in item (ii) of the preceding paragraph or an incorporation-type company split specified in item (vi) of said paragraph shall be provided to the Assuming Financial Institution or Financial Institution that will be established by the merger or the incorporation-type company split, and if there are two or more Assuming Financial Institutions involved in the merger or the incorporation-type company split, the application prescribed in paragraph (1) shall be made in joint names with said Assuming Financial Institutions.
(4) The purchase of assets specified in paragraph (1), item (iii) shall be conducted with respect to the assets of a Failed Financial Institution pertaining to a merger, etc. (meaning the merger, etc. prescribed in paragraph (2); the same shall apply hereinafter) or assets specified in each of the following items according to the category of merger, etc. specified in such item, and if the Financial Assistance pertaining to the application prescribed in paragraph (1) includes the purchase of assets of a Failed Financial Institution pertaining to a merger, etc., the Assuming Financial Institution or Assuming Bank Holding Company, etc. pertaining to the merger, etc. shall apply to the Corporation in joint names with said Failed Financial Institution for the Corporation to purchase said assets:
(i) a merger specified in paragraph (2), item (i): the assets of the Financial Institution surviving through the merger (limited to those that were the assets of the Failed Financial Institution prior to the merger);
(ii) a merger specified in paragraph (2), item (ii): the assets of the Financial Institution that will be established by the merger (limited to those that were the assets of the Failed Financial Institution prior to the merger);
(iii) a Business Transfer, etc. specified in paragraph (2), item (iii): the assets of another Financial Institution prescribed in paragraph (2), item (iii) that have been received through said Business Transfer, etc.;
(iv) the acquisition of shares specified in paragraph (2), item (iv): the assets of a Financial Institution whose shares have been so acquired;
(v) the absorption-type company split specified in paragraph (2), item (v): the assets of another Financial Institution set forth in said item which said Financial Institution has succeeded to through the absorption-type company split; and
(vi) the incorporation-type company split specified in paragraph (2), item (vi): the assets of the Financial Institution established through the incorporation-type company split (limited to those that were assets of the Failed Financial Institution prior to the incorporation-type company split).
(5) The Securing of Damage specified in paragraph (1), item (vii) shall be performed with respect to the loan claims that are the assets prescribed in each of the preceding items according to the category of merger, etc. specified in such item.
(6) A Financial Institution or Bank Holding Company, etc. that has made an application under paragraph (1) or (4) shall promptly report to that effect to the Prime Minister (in the case of a labor bank or federation of labor banks, to the Prime Minister and the Minister of Health, Labour and Welfare, and in the case of The Shoko Chukin Bank, Ltd., to the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry).
(7) Upon receiving an application under paragraph (1) or (4), the Corporation shall promptly report to that effect to the Minister of Finance; provided, however, that this shall not apply to cases where the Financial Institution that has made said application is The Shoko Chukin Bank, Ltd.
(Special Provisions for Application of Financial Assistance)
Article 59-2 (1) An Assuming Financial Institution undertaking a merger, etc. (limited to the Business Transfer, etc. specified in paragraph (2), item (iii) of the preceding Article whereby a Failed Financial Institution transfers part of its business to another Financial Institution, the Transfer of Insured Deposits, the absorption-type company split specified in item (v) of said paragraph where another Financial Institution succeeds to part of the rights and obligations held by the Failed Financial Institution in relation to its business, or the incorporation-type company split specified in item (vi) of said paragraph where the newly established Financial Institution succeeds to part of the rights and obligations held by the Failed Financial Institution in relation to its business) may apply to have the Corporation provide Financial Assistance to said Failed Financial Institution (limited to those specified in paragraph (1), item (i) of the preceding Article) in order to ensure equity between creditors of the Failed Financial Institution.
(2) The application under the preceding paragraph shall be made in joint names with the Failed Financial Institution pertaining to the merger, etc.
(3) The provisions of paragraph (6) of the preceding Article apply mutatis mutandis to an Assuming Financial Institution and Failed Financial Institution that have made an application under the provisions of the preceding two paragraphs, and the provisions of paragraph (7) of the preceding Article apply mutatis mutandis to the Corporation that has received an application under the provisions of the preceding two paragraphs.
Article 60 (1) A Financial Institution designated by the Prime Minister that, in order to support a merger, etc., loans funds to a Financial Institution pertaining to the merger, etc. (excluding the Failed Financial Institution) or to a Bank Holding Company, etc. pertaining to the merger, etc. or conducts any other act specified by Cabinet Order may apply to the Corporation for Financial Assistance (limited to those specified in Article 59, paragraph (1), item (ii) or (iv)).
(2) A Financial Institution that has made an application under the preceding paragraph shall promptly report to that effect to the Prime Minister (in the case of a labor bank or federation of labor banks, to the Prime Minister and the Minister of Health, Labour and Welfare).
(3) Upon receiving an application under paragraph (1), the Corporation shall promptly report to that effect to the Minister of Finance.
(Authorization of Eligibility)
Article 61 (1) With regard to a merger, etc. pertaining to an application prescribed in Article 59, paragraph (1), Article 59-2, paragraph (1), or paragraph (1) of the preceding Article, a Failed Financial Institution and Assuming Financial Institution or Failed Financial Institution and Assuming Bank Holding Company, etc. pertaining to said merger, etc. shall obtain the authorization of the Prime Minister by the time the application under these provisions is made.
(2) An application for the authorization under the preceding paragraph shall be made in the joint names of the Failed Financial Institution and Assuming Financial Institution or Failed Financial Institution and Assuming Bank Holding Company, etc. prescribed in the preceding paragraph.
(3) The Prime Minister may not grant authorization under paragraph (1) unless all of the following requirements are satisfied:
(i) the merger, etc. contributes to the protection of the Depositors, etc. and other creditors;
(ii) the Financial Assistance by the Corporation is indispensable for carrying out the merger, etc.; and
(iii) if the merger, etc. is not carried out for the Failed Financial Institution pertaining thereto and such Failed Financial Institution ceases all its business or is dissolved, it is likely to cause considerable detriment to the smooth supply and demand of funds and convenience of consumers in the region or fields in which said Failed Financial Institution conducts its business.
(4) The Prime Minister shall, when granting authorization under paragraph (1) to a labor bank or federation of labor banks, obtain consent from the Minister of Health, Labour and Welfare, and when granting authorization under paragraph (1) to The Shoko Chukin Bank, Ltd., obtain consent from the Minister of Finance and the Minister of Economy, Trade and Industry.
(5) The Prime Minister shall, when granting authorization under paragraph (1), make clear which Financial Institution pertaining to said authorization is a Failed Financial Institution.
(6) Upon granting the authorization under paragraph (1), the Prime Minister shall notify the Corporation to that effect.
(7) Upon receiving notice under the preceding paragraph, the Corporation shall promptly report to that effect to the Minister of Finance.
(8) In the event that a company seeking to acquire the shares of a Failed Financial Institution has applied for authorization set forth in Article 52-17, paragraph (1) of the Banking Act or Article 16-2-4, paragraph (1) of the Long-Term Credit Bank Act with regard to the fact that, as a result of such acquisition, said company will become a holding company which has a Bank as its subsidiary company or Holding company which has a Long-Term Credit Bank as its subsidiary company (hereinafter referred to as "Holding Company Authorization" in this paragraph), the Prime Minister may not grant authorization under paragraph (1) until after she/he has granted the Holding Company Authorization to said company.
(Mediation of Merger, etc.)
Article 62 (1) Even in cases where no application is being made under paragraph (2) of the preceding Article, if a Financial Institution falls under a Failed Financial Institution and the Prime Minister finds that such Failed Financial Institution satisfies the requirements specified in paragraph (3), item (iii) of the preceding Article, he/she may provide mediation in writing with regard to said merger, etc. (excluding those specified in Article 59, paragraph (2), item (ii) and limited to those that contribute to the protection of the Depositors, etc. and other creditors and for which the Financial Assistance by the Corporation is indispensable) between said Failed Financial Institution and another Financial Institution or said Failed Financial Institution and a Bank Holding Company, etc.
(2) Notwithstanding the provisions of paragraph (1) of the preceding Article, another Financial Institution or Bank Holding Company, etc. prescribed in the preceding paragraph that has received the mediation under the preceding paragraph may make an application under Article 59, paragraph (1) or Article 59-2, paragraph (1).
(3) Notwithstanding the provisions of paragraph (1) of the preceding Article, a Financial Institution designated by the Prime Minister under Article 60, paragraph (1) that, in order to support a merger, etc. pertaining to the mediation under paragraph (1), loans funds under Article 60, paragraph (1) to another Financial Institution or Bank Holding Company, etc. that has received said mediation, or conducts any other act specified by Cabinet Order, may make an application under Article 60, paragraph (1).
(4) The provisions of paragraphs (4) to (7) of the preceding Article apply mutatis mutandis to cases where the mediation is provided under paragraph (1).
(5) The Prime Minister may, when he/she finds it necessary for providing the mediation set forth in paragraph (1), within the limit of that necessity, deliver material related to the status of business and property of a Failed Financial Institution or a Financial Institution recognized as having a high probability of becoming a Failed Financial Institution to another Financial Institution or Bank Holding Company, etc. and make any other preparations for said mediation.
(6) The Prime Minister may request necessary cooperation from the Corporation for the mediation under paragraph (1) or preparations under the preceding paragraph.
Article 63 Deleted.
(Financial Assistance)
Article 64 (1) Upon receiving an application under Article 59, paragraph (1) or (4), Article 59-2, paragraph (1), or Article 60, paragraph (1), the Corporation shall, following a resolution of the Policy Board, decide whether to grant the Financial Assistance pertaining to the application without delay.
(2) When making a decision under the preceding paragraph, the Policy Board shall take into consideration the financial conditions of the Corporation, expected costs of the Financial Assistance pertaining to said decision, and expected costs for the payment of insurance proceeds with respect to an insurable contingency of the Failed Financial Institution pertaining to said Financial Assistance, and give due consideration to the efficient use of the Corporation's assets.
(3) Upon making a decision under paragraph (1), the Corporation shall immediately report matters pertaining to said decision to the Prime Minister and the Minister of Finance (if said decision pertains to a merger, etc. to which a labor bank or federation of labor banks is a party, to the Prime Minister, the Minister of Finance, and the Minister of Health, Labour and Welfare, and if said decision pertains to a merger, etc. to which The Shoko Chukin Bank, Ltd. is a party, to the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry).
(4) Upon making a decision to provide the Financial Assistance under paragraph (1), the Corporation shall conclude a contract concerning said Financial Assistance with a Financial Institution or Bank Holding Company, etc. pertaining to the application for said Financial Assistance.
(5) When the Financial Assistance pertaining to the contract prescribed in the preceding paragraph includes the Securing of Damage, the Financial Institution or Bank Holding Company, etc. pertaining to said contract shall stipulate therein that, if profits are accrued with respect to loan claims pertaining to the Securing of Damage, it shall pay part of said profits to the Corporation, or take measures to cause a person who is to hold said loan claims as a result of said merger, etc. to pay part of said profits to the Corporation.
(Financial Assistance Pertaining to Subscription for Preferred Shares, etc.)
Article 64-2 (1) When an application is made under Article 59, paragraph (1) for the Subscription for Preferred Shares, etc., the Assuming Financial Institution or Assuming Bank Holding Company, etc. (excluding the companies specified in Article 2, paragraph (5), item (v); hereinafter the same shall apply in this Article) pertaining to said application shall, at the time of making said application, submit to the Corporation a plan setting forth measures specified by Cabinet Order as measures to ensure the soundness of financial conditions, etc.
(2) When a resolution prescribed in paragraph (1) of the preceding Article relates to an application for the Subscription for Preferred Shares, etc., the Policy Board may not adopt a resolution to carry out said Subscription for Preferred Shares, etc., unless in light of the adequacy of equity capital of the Assuming Financial Institution or Assuming Bank Holding Company, etc. pertaining to said application, said Subscription for Preferred Shares, etc. does not exceed the scope necessary for the smooth implementation of said merger, etc. and conforms to other standards prescribed by the Prime Minister, the Minister of Finance, the Minister of Health, Labour and Welfare, and the Minister of Economy, Trade and Industry.
(3) In the event that an application is made under Article 59, paragraph (1) for the Subscription for Preferred Shares, etc., if the Corporation intends to make a decision to provide the Financial Assistance, it shall, following a resolution prescribed in the preceding paragraph, obtain prior approval from the Prime Minister and the Minister of Finance (if said application is made by a labor bank or federation of labor banks, from the Prime Minister, the Minister of Finance, and the Minister of Health, Labour and Welfare, and if said application is made by The Shoko Chukin Bank, Ltd., from the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry).
(4) In the event that an application under Article 59, paragraph (1) for the Subscription for Preferred Shares, etc. is made to support a merger, etc. (limited to those specified in Article 59, paragraph (2), item (ii) or (vi)), if the Corporation has made a decision under paragraph (1) of the preceding Article, a plan submitted pursuant to the provisions of paragraph (1) shall, following said merger, etc., be deemed to have been submitted by a Financial Institution established by said merger, etc. for the purpose of applying the provisions of this Article.
(5) Until the Corporation disposes or receives redemption or repayment of all Acquired Preferred Shares, etc. or Acquired Loan Claims (meaning those loan claims acquired by the Corporation through the Subscription for Preferred Shares, etc. based on a decision under paragraph (1) of the preceding Article; hereinafter the same shall apply in this Article to Article 68-3), the Corporation may request an Assuming Financial Institution (including the Financial Institutions established by the merger or incorporation-type company split pertaining to Subscription for Preferred Shares, etc.; hereinafter the same shall apply in this Article to Article 68-3) or Assuming Bank Holding Company, etc. that is an issuer of said Acquired Preferred Shares, etc. or obligor pertaining to Acquired Loan Claims actually held by the Corporation to report the status of implementation of the plan that was submitted under paragraph (1) and make such report public.
(6) The term "Acquired Preferred Shares, etc." as used in the preceding paragraph means the following:
(i) the Preferred Shares, etc. (including the following) and other Shares, etc. specified by Cabinet Order acquired by the Corporation through the Subscription for Preferred Shares, etc. based on a decision under paragraph (1) of the preceding Article:
(a) in the event that the Preferred Shares, etc. are preferred shares, the following shares:
1. in the event that said preferred shares are those for which a request for Conversion into Shares of Another Class (meaning the delivery of shares of another class in exchange for the acquisition of said preferred shares by their issuing company; hereinafter the same shall apply in this paragraph) can be made, shares of another class into which said shares are converted pursuant to the request;
2. in the event that the preferred shares are convertible upon the occurrence of certain events, shares of another class into which the preferred shares are converted as a result of such occurrence; and
3. Shares split or consolidated with respect to the preferred shares or the shares of another class specified in 1 or 2;
(b) in the event that the Preferred Shares, etc. are subordinated bonds, shares delivered through the exercise of share options attached to said subordinated bonds and shares split or consolidated with respect thereto; and
(c) in the event that the Preferred Shares, etc. are preferred equity investments, preferred equity investments split with respect to said preferred equity investments; and
(ii) preferred shares (including the following) allotted to the Corporation by a company that has become a wholly owning parent stock company in a share exchange (meaning the wholly owning parent stock company in share exchange prescribed in Article 768, paragraph (1), item (i) of the Companies Act; the same shall apply hereinafter) or wholly owning parent company incorporated through a share transfer (meaning the wholly owning parent company incorporated through share transfer prescribed in Article 773, paragraph (1), item (i) of said Act; the same shall apply hereinafter) through share exchange or share transfer effected by a Financial Institution or Bank Holding Company, etc. for which the Corporation conducted the Subscription for Preferred Shares, etc. pursuant to a decision under paragraph (1) of the preceding Article, and other Shares, etc. specified by Cabinet Order:
(a) in the event that said preferred shares are those for which a request for Conversion into Shares of Another Class can be made, shares of another class into which said shares are converted pursuant to the request;
(b) in the event that the preferred shares are convertible upon the occurrence of certain events, shares of another class into which the preferred shares are converted as a result of such occurrence; and
(c) shares split or consolidated with respect to said preferred shares or the shares of another class specified in (a) or (b).
(Reporting of Agreement for Merger, etc.)
Article 65 A Financial Institution or Bank Holding Company, etc. that has received the authorization under Article 61, paragraph (1) or mediation under Article 62, paragraph (1) (hereinafter referred to as "Authorization of Eligibility, etc.") shall, upon concluding an agreement for merger, etc. pertaining to the Authorization of Eligibility, etc., immediately report to that effect to the Prime Minister (in the case of a labor bank or federation of labor banks, to the Prime Minister and the Minister of Health, Labour and Welfare, and in the case of The Shoko Chukin Bank, Ltd., to the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry) and submit a copy of said agreement for merger, etc. (in the case of a Financial Institution or Bank Holding Company, etc. that has concluded a contract with the Corporation under Article 64, paragraph (4), a copy of said agreement for merger, etc. and documents stating the details of the contract under Article 64, paragraph (4)).
(Reporting of Resolution of Shareholders Meeting, etc.)
Article 66 (1) In the event that a resolution or decision of shareholders meeting, etc. or consent of all shareholders or all class shareholders (meaning the consent prescribed in Article 783, paragraph (2) or (4) of the Companies Act; the same shall apply hereinafter) is required for a merger, Business Transfer, etc., Transfer of Insured Deposits, share exchange, or share transfer, or company split under the provisions of this Act, the Companies Act, other Acts, or the articles of incorporation, a Financial Institution that has received the Authorization of Eligibility, etc. shall, when it has obtained or failed to obtain a resolution or decision, or consent of all shareholders or all class shareholders for a merger, Business Transfer, etc., Transfer of Insured Deposits, share exchange or share transfer, or company split pertaining to said Authorization of Eligibility, etc., immediately report to that effect to the Prime Minister (in the case of a labor bank or federation of labor banks, to the Prime Minister and the Minister of Health, Labour and Welfare, and in the case of The Shoko Chukin Bank, Ltd., to the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry) and submit the minutes of said shareholders meeting, etc. and any other documents proving such fact (including those prepared in the form of an electromagnetic record (meaning a record that is created by an electronic method, magnetic method, or another method which cannot be recognized by human sensory perception, specified by Cabinet Office Ordinance and Ordinance of the Ministry of Finance as used for data processing with computers; the same shall apply in Article 106, paragraph (3))), and shall also notify the Corporation to that effect. The same shall apply when, in the event that a resolution of shareholders meeting, etc. or consent of all shareholders or all class shareholders is required for share exchange under the provisions of this Act, the Companies Act, or the articles of incorporation, a Bank Holding Company, etc. that has received the Authorization of Eligibility, etc. has obtained or failed to obtain such resolution or consent for share exchange pertaining to said Authorization of Eligibility, etc.
(2) The term "shareholders meeting, etc." as used in the preceding paragraph means, in the case of a Bank, etc., Bank Holding Company, etc., or The Shoko Chukin Bank, Ltd., a shareholders meeting or class meeting (meaning, in the case prescribed in Article 22, paragraph (6) of the Act on Financial Institutions' Merger and Conversion, a shareholders meeting and the shareholders meeting prescribed in Article 22, paragraph (6)), and in the case of a shinkin bank, federation of shinkin banks, credit cooperative, Federation of Credit Cooperatives, labor bank, or federation of labor banks (hereinafter referred to as a "Shinkin Bank, etc."), a general meeting or general meeting of representatives.
(3) A Financial Institution or Bank Holding Company, etc. that has received the Authorization of Eligibility, etc. under paragraph (1) shall, in the following cases, immediately report to that effect to the Prime Minister (in the case of a labor bank or federation of labor banks, to the Prime Minister and the Minister of Health, Labour and Welfare, and in the case of The Shoko Chukin Bank, Ltd., to the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry) and also notify the Corporation to that effect:
(i) in the event that a Financial Institution or Bank Holding Company, etc. that has received the Authorization of Eligibility, etc. under paragraph (1) seeks to receive the whole or part of business or undertake a merger, share exchange, or company split without obtaining approval by a resolution or decision of a shareholders meeting, etc. (meaning the shareholders meeting, etc. prescribed in the preceding paragraph; the same shall apply in the following item) under Article 468, paragraph (2) or Article 796, paragraph (3) of the Companies Act, the proviso to Article 58, paragraph (2) or the proviso to Article 61-3, paragraph (3) of the Shinkin Bank Act, the second sentence of Article 57-3, paragraph (2) or the proviso to Article 63-5, paragraph (3) of the Small and Medium-Sized Enterprises Cooperatives Act, the proviso to Article 62, paragraph (2) or the proviso to Article 62-6, paragraph (3) of the Labor Bank Act, or Article 30, paragraph (1) or Article 42, paragraph (1) of the Act on Financial Institutions' Merger and Conversion, when said Financial Institution or Bank Holding Company, etc. has come to fall under the case prescribed in Article 468, paragraph (3) or Article 796, paragraph (4) of the Companies Act, Article 58, paragraph (4) or Article 61-3, paragraph (5) of the Shinkin Bank Act, Article 57-3, paragraph (3) or Article 63-5, paragraph (4) of the Small and Medium-Sized Enterprises Cooperatives Act, Article 62, paragraph (4) or Article 62-6, paragraph (5) of the Labor Bank Act, or Article 30, paragraph (2) or Article 42, paragraph (2) of the Act on Financial Institutions' Merger and Conversion; and
(ii) in the event that a Financial Institution that has received the Authorization of Eligibility, etc. under paragraph (1) seeks to conduct a Business Transfer, etc. with the permission of the court in lieu of a resolution or decision of a shareholders meeting, etc. or consent of all shareholders or all class shareholders under Article 87 or Article 43 of the Civil Rehabilitation Act (including the cases where it is applied mutatis mutandis pursuant to Article 454 of the Act on Special Measures of Corporate Reorganization Proceedings and Other Insolvency Proceedings of Financial Institutions), if said Financial Institution has failed to obtain said permission.
(4) Upon receiving notice under paragraph (1) or the preceding paragraph, the Corporation shall immediately report to that effect to the Minister of Finance; provided, however, that this shall not apply in cases where the Financial Institution that gave said notice is The Shoko Chukin Bank, Ltd.
(Special Provisions for Continuation of Business)
Article 67 (1) In the event that an Assuming Financial Institution that has received the Authorization of Eligibility, etc. has, through a merger, transfer of business, Transfer of Insured Deposits, or company split pertaining to said Authorization of Eligibility, etc., succeeded to the rights and obligations pertaining to a contract belonging to any business that said Financial Institution is prohibited or restricted from carrying out by laws and regulations concerning the business or operations of said Financial Institution, said Financial Institution may continue the business concerning such contract until the period of contract expires, if the contract prescribes a period, and for a period limited to two years from the date of succession, if the contract does not prescribe a period.
(2) An Assuming Financial Institution that has received the Authorization of Eligibility, etc. may, in the event that there are special circumstances in light of the convenience of the users of the business concerning the contract prescribed in the preceding paragraph, etc., prepare a plan as to how said business is to be concluded within a specified period of time, and if said plan is approved by the Prime Minister (in the case of a labor bank or federation of labor banks, by the Prime Minister and the Minister of Health, Labour and Welfare, and in the case of The Shoko Chukin Bank, Ltd., by the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry), continue said business in accordance with said plan and within a scope not exceeding the total amount of said contract as of the date of the merger, assumption of business, Transfer of Insured Deposits, or company split, by renewing the contract following the expiration of the period prescribed in the preceding paragraph or beyond the period prescribed in the preceding paragraph.
(Consultation with Minister of Finance)
Article 68 The Prime Minister shall, when he/she finds that if the Corporation is to provide Financial Assistance for a merger, etc. pertaining to the Authorization of Eligibility, etc., the financial conditions of the Corporation would deteriorate extremely and have a serious impact on the maintenance of an orderly credit system, consult in advance with the Minister of Finance concerning measures necessary for the maintenance of an orderly credit system.
(Approval of Share Exchange, etc. Pertaining to Financial Assistance)
Article 68-2 (1) An Assuming Financial Institution or an Assuming Bank Holding Company, etc. for which the Corporation conducted the Subscription for Preferred Shares, etc. based on a decision under Article 64, paragraph (1) (including companies prescribed in the following paragraph in the event that an approval is obtained under this paragraph and the bridge Financial Institution, etc. prescribed in paragraph (4) of the following Article in the event that an approval is obtained under paragraph (1) of the following Article; the same shall apply in the following Article), which has issued shares that are Acquired Preferred Shares, etc. actually held by the Corporation (hereinafter referred to as "Issuing Assuming Financial Institution, etc." in this Article), shall obtain approval from the Corporation before effecting a share exchange (limited to those through which the Issuing Assuming Financial Institution, etc. becomes a wholly owned subsidiary company in the share exchange (meaning a wholly owned subsidiary company in the share exchange prescribed in Article 768, paragraph (1), item (i) of the Companies Act; the same shall apply in Article 108-2, paragraph (1) and Article 126-25, paragraph (1))) or share transfer (hereinafter referred to as "Share Exchange, etc." in this Article).
(2) The Corporation shall not grant the approval under the preceding paragraph unless a company that becomes, through the Share Exchange, etc., a wholly owning parent stock company in a share exchange or wholly owning parent company incorporated through a share transfer of the Issuing Assuming Financial Institution, etc. is a Financial Institution or Bank Holding Company, etc. (including those that will be newly established and, in the case of a Bank Holding Company, etc., limited to those specified in Article 2, paragraph (5), item (i) or (iii)) and conforms to other standards prescribed and publicly announced by the Prime Minister and the Minister of Finance.
(3) The Corporation shall obtain the prior approval of the Prime Minister and the Minister of Finance before granting the approval under paragraph (1).
(4) When an Issuing Assuming Financial Institution, etc. has effected the Share Exchange, etc. following the approval under paragraph (1), a company that has become, through said Share Exchange, etc., a wholly owning parent stock company in the share exchange or wholly owning parent company incorporated through a share transfer of said Issuing Assuming Financial Institution, etc. shall submit to the Corporation a plan setting forth measures specified by Cabinet Order as measures to ensure the soundness of financial conditions, etc.
(5) The provisions of Article 64-2, paragraph (5) apply mutatis mutandis to the plan submitted to the Corporation under the preceding paragraph. In this case, the terms "an Assuming Financial Institution (including the Financial Institutions established by the merger or incorporation-type company split pertaining to Subscription for Preferred Shares, etc.; hereinafter the same shall apply in this Article to Article 68-3) or Assuming Bank Holding Company, etc." and "issuer ... or obligor pertaining to Acquired Loan Claims" in Article 64-2, paragraph (5) shall be deemed to be replaced with "a company that has submitted a plan under Article 68-2, paragraph (4)," and "issuer pertaining to", respectively.
(Approval for Corporate Reorganization Pertaining to Financial Assistance)
Article 68-3 (1) An Assuming Financial Institution or Assuming Bank Holding Company, etc., for which the Corporation conducted the Subscription for Preferred Shares, etc. based on a decision under Article 64, paragraph (1), and which is an issuer or obligor pertaining to Acquired Preferred Shares, etc. (meaning the Acquired Preferred Shares, etc. prescribed in Article 64-2, paragraph (6); hereinafter the same shall apply in this paragraph and paragraph (4) of the following Article) or Acquired Loan Claims actually held by the Corporation (hereinafter referred to as "Financial Institution Eligible for Financial Assistance, etc." in this Article), shall obtain approval from the Corporation before implementing a corporate reorganization (meaning a merger, company split or transfer of the whole or part of business, in which an issuer of Acquired Preferred Shares, etc. or obligor pertaining to Acquired Loan Claims after the merger, company split or business transfer will be a corporation (including those that will be newly established) other than the Financial Institution Eligible for Financial Assistance, etc.; hereinafter the same shall apply in this Article).
(2) The Corporation shall not grant the approval under the preceding paragraph unless the corporation other than the Financial Institution Eligible for Financial Assistance, etc. prescribed in the preceding paragraph is a Financial Institution or Bank Holding Company, etc. (limited to those specified in Article 2, paragraph (5), items (i) and (iii)) and conforms to other standards prescribed and publicly announced by the Prime Minister, the Minister of Finance, the Minister of Health, Labour and Welfare, and the Minister of Economy, Trade and Industry.
(3) The Corporation shall obtain approval from the Prime Minister and the Minister of Finance (in the event that the Financial Institution Eligible for Financial Assistance, etc. is a labor bank or federation of labor banks, from the Prime Minister, the Minister of Finance, and the Minister of Health, Labour and Welfare, and in the event that the Financial Institution Eligible for Financial Assistance, etc. is The Shoko Chukin Bank, Ltd., from the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry) before granting the approval under paragraph (1).
(4) In the event that a Financial Institution Eligible for Financial Assistance, etc. has implemented a corporate reorganization after receiving the approval under paragraph (1), if there is a bridge Financial Institution, etc. pertaining to said corporate reorganization (meaning a corporation other than the Financial Institution Eligible for Financial Assistance, etc. prescribed in paragraph (1)), said bridge Financial Institution, etc. shall submit to the Corporation a plan setting forth measures specified by Cabinet Order as measures to ensure the soundness of financial conditions, etc.
(5) The provisions of Article 64-2, paragraph (5) apply mutatis mutandis to a plan submitted to the Corporation under the preceding paragraph. In this case, the term "Assuming Financial Institution (including the Financial Institutions established by the merger or incorporation-type company split pertaining to Subscription for Preferred Shares, etc.; hereinafter the same shall apply in this Article to Article 68-3) or Assuming Bank Holding Company, etc." in Article 64-2, paragraph (5) shall be deemed to be replaced with "bridge Financial Institution, etc. prescribed in Article 68-3, paragraph (4)."
(Additional Financial Assistance)
Article 69 (1) In the event that, subsequent to a merger, etc. pertaining to Financial Assistance, an Assuming Financial Institution or Assuming Bank Holding Company, etc. pertaining to said Financial Assistance or a Financial Institution established by the merger or incorporation-type company split pertaining to said Financial Assistance applies for additional Financial Assistance (referred to as "Additional Financial Assistance" in paragraph (4)), the Corporation may, when it finds it necessary, provide the Additional Financial Assistance to the Financial Institution that has made said application.
(2) The purchase of assets pertaining to the application under the preceding paragraph shall be conducted with respect to the assets of the Failed Financial Institution pertaining to a merger, etc. (limited to the Business Transfer, etc. specified in Article 59, paragraph (2), item (iii) in which a Failed Financial Institution transfers part of its business to another Financial Institution, the Transfer of Insured Deposits, the absorption-type company split specified in item (v) of said paragraph where another Financial Institution succeeds to part of the rights and obligations held by the Failed Financial Institution in relation to its business, or the incorporation-type company split specified in item (vi) of said paragraph where the Financial Institution newly established through the incorporation-type company split succeeds to part of the rights and obligations held by the Failed Financial Institution in relation to its business) or assets prescribed in each of the following items according to the category of merger, etc. specified in each respective item, and if the Financial Assistance pertaining to the application under the preceding paragraph includes the purchase of assets of the Failed Financial Institution pertaining to a merger, etc. (limited to the Business Transfer, etc. specified in Article 59, paragraph (2), item (iii) in which a Failed Financial Institution transfers part of its business to another Financial Institution, the Transfer of Insured Deposits, the absorption-type company split specified in item (v) of said paragraph where another Financial Institution succeeds to part of the rights and obligations held by the Failed Financial Institution in relation to its business, or the incorporation-type company split specified in item (vi) of said paragraph where the Financial Institution newly established through the incorporation-type company split succeeds to part of the rights and obligations held by the Failed Financial Institution in relation to its business; hereinafter the same shall apply in this paragraph and paragraph (4)), an Assuming Financial Institution pertaining to said merger, etc. shall apply to the Corporation for the purchase of said assets in joint names with said Failed Financial Institution:
(i) a merger specified in Article 59, paragraph (2), item (i): the assets of the Financial Institution surviving through the merger (limited to those that were the assets of the Failed Financial Institution prior to the merger);
(ii) a merger specified in Article 59, paragraph (2), item (ii): the assets of the Financial Institution established by the merger (limited to those that were the assets of the Failed Financial Institution prior to the merger);
(iii) a Business Transfer, etc. specified in Article 59, paragraph (2), item (iii): the assets of another Financial Institution prescribed in Article 59, paragraph (2), item (iii) that have been received through the Business Transfer, etc.;
(iv) an acquisition of shares specified in Article 59, paragraph (2), item (iv): the assets of the Financial Institution subject to the acquisition of shares;
(v) the absorption-type company split specified in Article 59, paragraph (2), item (v): the assets of another Financial Institution set forth in said item which said Financial Institution has succeeded to through the absorption-type company split; and
(vi) the incorporation-type company split specified in Article 59, paragraph (2), item (vi): the assets of the Financial Institution established through the incorporation-type company split (limited to those that were assets of the Failed Financial Institution prior to the incorporation-type company split).
(3) The Securing of Damage pertaining to the application under paragraph (1) shall be conducted with respect to loan claims that are the assets prescribed in each item of the preceding paragraph according to the category of merger, etc. specified in each respective item.
(4) The provisions of Article 59, paragraph (6) and (7), Article 64, and Article 64-2 apply mutatis mutandis to the application under paragraph (1) or (2), the provisions of Article 59-2 apply mutatis mutandis to the Assuming Financial Institution that has conducted the merger, etc. pertaining to the Financial Assistance, the provisions of Article 67 and Article 68 apply mutatis mutandis to the Additional Financial Assistance, and the provisions of the preceding two Articles apply mutatis mutandis to the Assuming Financial Institution, Assuming Bank Holding Company, etc. or the Financial Institutions established by the merger or incorporation-type company split pertaining to the Financial Assistance (excluding the Financial Institutions to which the Corporation has provided the Financial Assistance pertaining to the Subscription for Preferred Shares, etc. and in which the Corporation actually holds Acquired Preferred Shares, etc. pertaining to said Financial Assistance, but including companies prescribed in Article 68-2, paragraph (2) as applied mutatis mutandis pursuant to this paragraph in the event that approval is obtained under Article 68-2, paragraph (1) as applied mutatis mutandis pursuant to this paragraph and the bridge Financial Institution, etc. prescribed in Article 68-2, paragraph (4) as applied mutatis mutandis pursuant to this paragraph in the event that an approval is obtained under paragraph (1) of the preceding Article as applied mutatis mutandis pursuant to this paragraph) to which the Corporation has provided the Additional Financial Assistance (limited to those pertaining to the Subscription for Preferred Shares, etc.). In this case, the term "expected costs for the payment of insurance proceeds with respect to an insurable contingency of the Failed Financial Institution pertaining to said Financial Assistance" in Article 64, paragraph (2) shall be deemed to be replaced with "expected costs of the Financial Assistance pertaining to the decision of the Policy Board made prior to said decision with respect to the Failed Financial Institution pertaining to said Financial Assistance and expected costs for the payment of insurance proceeds with respect to an insurable contingency of said Failed Financial Institution," and the term "the Corporation is to provide Financial Assistance for a merger, etc. pertaining to the Authorization of Eligibility, etc.," in Article 68 shall be deemed to be replaced with " the Additional Financial Assistance is to be provided", and any other necessary technical replacement of terms shall be specified by Cabinet Order.
Chapter III-2 Protection of Creditors Concerning Settlement of Funds
(Protection of Settlement Obligations)
Article 69-2 (1) With regard to obligations borne by a Financial Institution with regard to exchange transactions and other transactions specified by Cabinet Order as transactions pertaining to the settlement of funds undertaken by a Financial Institution (excluding those for which payment is made in a foreign country, and limited to those resulting from entrustment by a Financial Institution and by other persons who engage in financial business other than persons specified by Cabinet Order and to those specified by Cabinet Order; hereinafter referred to as "Settlement Obligations" in this Chapter), other than those that will be extinguished if there is repayment of the Covered Deposits for Settlement (hereinafter referred to as "Specified Settlement Obligations" in this paragraph and paragraph (1) of the following Article), the Specified Settlement Obligations shall be deemed to be obligations pertaining to the Covered Deposits for Settlement, claims pertaining to the Specified Settlement Obligations shall be deemed to be claims pertaining to the Covered Deposits for Settlement, creditors pertaining to the Specified Settlement Obligations shall be deemed to be the Depositors, etc., the amount of the Specified Settlement Obligations shall be deemed to be the amount of the Covered Deposits for Settlement, and the repayment of the Specified Settlement Obligations shall be deemed to be the repayment of the Covered Deposits for Settlement, for the purpose of applying the provisions of this Act (excluding Article 58-2, this Chapter, Article 73, and Article 127 and penal provisions pertaining thereto). In this case, the term "insurance premiums pertaining to deposits that satisfy all of the following requirements (excluding foreign currency deposits and other deposits specified by Cabinet Order; hereinafter referred to as "Deposits for payment and settlement purposes")" in Article 51-2, paragraph (1) shall be deemed to be replaced with "insurance premiums pertaining to the Specified Settlement Obligations," the term "insurance proceeds pertaining to the Deposits for payment and settlement purposes (excluding those held under the name of another person and other Deposits for payment and settlement purposes specified by Cabinet Order; hereinafter referred to as "Covered Deposits for Settlement")" in Article 54-2, paragraph (1) shall be deemed to be replaced with "insurance proceeds pertaining to the Specified Settlement Obligations," and the term "the amount of principal ... of" shall be deemed to be replaced with "the amount of," the term "the Covered Deposits for Settlement held thereby" in Article 54-2, paragraph (2) shall be deemed to be replaced with "the claims pertaining to the Specified Settlement Obligations held thereby," the term "Deposits, etc." in Article 55-2, paragraph (4) shall be deemed to be replaced with "Specified Settlement Obligations," and the term "Covered Deposits, etc." in Article 58-3, paragraph (1) shall be deemed to be replaced with "Specified Settlement Obligations."
(2) Where the Settlement Obligations will be extinguished if there is repayment of the General Deposits, etc., the General Deposits, etc. whose amount is equivalent to the amount of said Settlement Obligations shall be deemed to be the Deposits for payment and settlement purposes.
(Loan of Funds for Repayment of Settlement Obligations)
Article 69-3 (1) In the event that the Corporation receives from any of the following persons an application for a loan of funds necessary for the repayment of the Settlement Obligations (limited to those carried out with respect to the Covered Deposits for Settlement or Specified Settlement Obligations corresponding to the amount of insurance proceeds calculated under Article 54-2, paragraph (1) and Article 54, paragraph (3) as applied mutatis mutandis pursuant to Article 54-2, paragraph (2)), the Corporation may, when it finds it necessary, and following a resolution of the Policy Board, decide to provide the loan pertaining to said application up to the total amount of insurance proceeds pertaining to said Settlement Obligations calculated under Article 54-2, paragraph (1) and Article 54, paragraph (3) as applied mutatis mutandis pursuant to Article 54-2, paragraph (2):
(i) a Financial Institution that has become subject to a injunction ordering management under Article 74, paragraph (1) or (2);
(ii) a person who has become subject to a ruling for the commencement of bankruptcy proceedings (limited to a person who was a Financial Institution prior to becoming subject to said ruling for the commencement of bankruptcy proceedings);
(iii) a Failed Financial Institution that has become subject to a injunction ordering management by a provisional administrator under Article 91, paragraph (1) of the Bankruptcy Act;
(iv) a Failed Financial Institution that has become subject to a ruling for the commencement of reorganization proceedings;
(v) a Failed Financial Institution that has become subject to a injunction ordering management by a provisional administrator under Article 30, paragraph (1) of the Corporate Reorganization Act or Article 22, paragraph (1) of the Act on Special Measures of Corporate Reorganization Proceedings and Other Insolvency Proceedings of Financial Institutions;
(vi) a Failed Financial Institution that has become subject to a injunction by a trustee ordering management under Article 64, paragraph (1) of the Civil Rehabilitation Act;
(vii) a Failed Financial Institution that has become subject to a injunction ordering management by a provisional administrator under Article 79, paragraph (1) of the Civil Rehabilitation Act; or
(viii) a person who has become subject to an order for commencement of special liquidation (limited to a person who was a Financial Institution prior to its dissolution pertaining to said order).
(2) The provisions of Article 64, paragraph (3) apply mutatis mutandis to the cases where a decision is made under the preceding paragraph, and the provisions of Article 64, paragraph (4) apply mutatis mutandis to the cases where a decision to provide a loan is made under the preceding paragraph. In this case, the term "pertains to a merger, etc. to which ... is a party" in Article 64, paragraph (3) shall be deemed to be replaced with "pertains to ..."
(3) The loan provided under paragraph (1) to a person specified in each of the following items shall, in relation to creditors other than the Corporation in bankruptcy proceedings, reorganization proceedings, rehabilitation proceedings or special liquidation proceedings pertaining to said Financial Institution, be deemed to be provided prior to the decision prescribed in each respective item:
(i) a person specified in paragraph (1), item (ii): said ruling for the commencement of bankruptcy proceedings;
(ii) a Failed Financial Institution specified in paragraph (1), item (iv): said ruling for the commencement of reorganization proceedings;
(iii) a Failed Financial Institution that has become subject to a ruling for the commencement of rehabilitation proceedings: said ruling for the commencement of rehabilitation proceedings; and
(iv) a person specified in paragraph (1), item (viii): said order for commencement of special liquidation.
(4) The expected costs of the loan of funds provided pursuant to a decision under paragraph (1) shall be deemed to be the expected costs of the Financial Assistance prescribed in Article 64, paragraph (2) for the purpose of applying Article 64, paragraph (2).
(5) The person specified in paragraph (1), item (ii) or (viii) shall be deemed to be a Financial Institution for the purpose of the application of this Act pertaining to the loan prescribed in paragraph (1).
(Special Provisions of the Bankruptcy Act, etc. Pertaining to Settlement Obligations)
Article 69-4 (1) In the event that a Financial Institution that owes the Settlement Obligations and settlement creditors (meaning other Financial Institutions that hold claims pertaining to said Settlement Obligations and also owe other Settlement Obligations to said Financial Institution (including other persons who have acquired from said other Financial Institutions the claims pertaining to said Settlement Obligations or assumed said other Settlement Obligations); hereinafter the same shall apply in this paragraph) have, prior to the occurrence of an insurable contingency pertaining to said Financial Institution, concluded a contract, under which the whole or part of the Settlement Obligations owed to each other shall be extinguished by way of continuous set-off thereof, if the Settlement Obligations subject to said contract arose after said Financial Institution's insolvency, etc. (meaning insolvency (meaning the condition in which said Financial Institution, due to the lack of ability to pay, is generally and continuously unable to pay its debts as they become due), suspension of payments, or a petition for the commencement of bankruptcy proceedings, commencement of reorganization proceedings, commencement of rehabilitation proceedings or commencement of special liquidation; hereinafter the same shall apply in this paragraph) and there has been a decision pertaining to said Financial Institution for the provision of a loan under paragraph (1) of the preceding Article (including the cases where it is applied mutatis mutandis pursuant to Article 127), said settlement creditors may, notwithstanding the provisions of Article 517 and Article 518 of the Companies Act, Article 71 and Article 72 of the Bankruptcy Act, Article 49 and Article 49-2 of the Corporate Reorganization Act (including the cases where these provisions are applied mutatis mutandis pursuant to Article 35 of the Act on Special Measures of Corporate Reorganization Proceedings and Other Insolvency Proceedings of Financial Institutions) and Article 93 and Article 93-2 of the Civil Rehabilitation Act, set off the Settlement Obligations specified in the following items that are owed by said Financial Institution pertaining to claims held by such creditors against the Settlement Obligations owed by such creditors prescribed in such item:
(i) the Settlement Obligations that arose prior to said insolvency, etc.: the Settlement Obligations owed to said Financial Institution (excluding those based on a cause that arose prior to said insolvency, etc.) that arose between the time of said insolvency, etc. and a ruling for the commencement of bankruptcy proceedings, commencement of reorganization proceedings, or commencement of rehabilitation proceedings, or an order for commencement of special liquidation (hereinafter referred to as "Ruling for Commencement of Bankruptcy Proceedings, etc." in this item) pertaining to said insolvency, etc., or the Settlement Obligations owed to said Financial Institution that arose after said Ruling for Commencement of Bankruptcy Proceedings, etc.; and
(ii) the Settlement Obligations that arose after said insolvency, etc.: the Settlement Obligations owed to said Financial Institution.
(2) The provisions of Article 653 of the Civil Code shall not apply to a consignment contract concluded by said Financial Institution pertaining to the Settlement Obligations.
(3) When a decision has been made to loan funds under paragraph (1) of the preceding Article to a Failed Financial Institution that has become subject to an order for commencement of special liquidation, the court may, notwithstanding the provisions of Article 500, paragraph (1) and Article 537, paragraph (1) of the Companies Act, in response to a petition filed by said Failed Financial Institution, grant permission for the repayment of the Settlement Obligations prescribed in paragraph (1) of the preceding Article.
(4) The court shall, upon granting the permission under the preceding paragraph, specify the types of the Settlement Obligations to be repaid, limit of the amount of repayment, and period of repayment (in the case referred to in the preceding paragraph, the last day of said period shall precede the date of notice under Article 549, paragraph (1) of the Companies Act).
(5) When specifying the types of the Settlement Obligations to be repaid, limit of the amount of repayment, and period of repayment under the preceding paragraph, the court shall hear the opinion of the Corporation in advance.
Chapter IV Purchase of Deposits and Other Claims
(Purchase of Deposits and Other Claims)
Article 70 (1) In the cases prescribed in Article 57, paragraph (1) (including the cases where the Corporation finds it necessary for the protection of the Depositors, etc. of a Financial Institution subject to the Category One Insurable Contingency), the Corporation may, following a resolution by the Policy Board, decide to purchase deposits and other claims pertaining to an insurable contingency prescribed in each item of Article 57, paragraph (1) (meaning claims pertaining to the Deposits, etc. held by the Depositors, etc. in the Financial Institution subject to the insurable contingency (excluding the Deposits, etc. specified by Cabinet Order) that are not subject to a security interest; the same shall apply hereinafter).
(2) The purchase under the preceding paragraph shall be made within the purchase period publicly announced under Article 72, paragraph (1) or (3), upon request by the Depositors, etc. who hold deposits and other claims pertaining to the insurable contingency prescribed in the preceding paragraph based on an approximate estimate of said deposits and other claims; provided, however, that in the event that the Corporation has collected the deposits and other claims pertaining to the purchase, if an amount obtained by deducting from the amount so collected the amount of costs specified by Cabinet Order as being required for said purchase exceeds the amount equivalent to estimated proceeds payment pertaining to said purchase, the Corporation shall pay such excess to said Depositors, etc.
(3) The amount of estimated proceeds payment prescribed in the preceding paragraph shall be calculated by deducting from the amount of deposits and other claims to be purchased by the Corporation from the Depositors, etc. the amount of interest, distribution of profits and any other amount equivalent thereto specified by Cabinet Order corresponding to the period between the date of the insurable contingency and the date of said purchase, and multiplying the amount thus calculated by a rate determined by the Corporation under paragraph (1) of the following Article (hereinafter referred to as "Estimated Proceeds Payment Rate").
(4) The provisions of Article 53, paragraph (3) apply mutatis mutandis to the payment of an amount equivalent to estimated proceeds payment pertaining to the purchase under paragraph (2) (hereinafter referred to as "Estimated Proceeds Payment").
(5) When the Corporation finds that the Depositors, etc. did not make a request within the purchase period prescribed in paragraph (2) due to natural disaster or any other unavoidable reason, the Corporation may, notwithstanding the provisions of paragraph (2), purchase deposits and other claims of said Depositors, etc. even after the lapse of said purchase period.
(Estimated Proceeds Payment Rate)
Article 71 (1) In making a decision under paragraph (1) of the preceding Article, the Corporation shall, following a resolution of the Policy Board, specify the Estimated Proceeds Payment Rate for the purchase pertaining to said decision and obtain the authorization of the Prime Minister and the Minister of Finance for said decision.
(2) When making a decision on the Estimated Proceeds Payment Rate under the preceding paragraph, the Policy Board shall take into consideration, in light of the financial conditions of the Financial Institution pertaining to the decision under paragraph (1) of the preceding Article, the expected amount of payment to be received for deposits and other claims pertaining to said Financial Institution in the event that it becomes subject to bankruptcy proceedings, and give due consideration to the efficient use of the Corporation's assets.
(3) When granting the authorization set forth in paragraph (1), the Prime Minister and the Minister of Finance shall obtain consent from the Minister of Health, Labour and Welfare if said Financial Institution is a labor bank or federation of labor banks, and shall obtain consent from the Minister of Economy, Trade and Industry if said Financial Institution is The Shoko Chukin Bank, Ltd.
(Public Notice of Purchase, etc.)
Article 72 (1) Upon receiving the authorization set forth in paragraph (1) of the preceding Article, the Corporation shall, following a resolution by the Policy Board, promptly specify the period, location, and method of the Estimated Proceeds Payment pertaining to the purchase of deposits and other claims and other matters specified by Cabinet Order and give public notice thereof together with the Estimated Proceeds Payment Rate pertaining to said authorization.
(2) If, after giving public notice under the preceding paragraph, there is public notice under Article 197, paragraph (1) of the Bankruptcy Act (including the cases where it is applied mutatis mutandis pursuant to Article 209, paragraph (3) of said Act), notice under Article 137-2, paragraph (2), or any other event specified by Cabinet Order with respect to said Financial Institution, the Corporation may, pursuant to the provisions of Cabinet Order, change the purchase period that was publicly announced under the provisions of the preceding paragraph.
(3) If the Corporation has changed the payment period under the preceding paragraph, the Corporation shall give public notice of matters pertaining to said change without delay.
(4) When making payment under the proviso to Article 70, paragraph (2), the Corporation shall, following a resolution of the Policy Board, specify the amount and period of payment and other matters specified by Cabinet Order and give public notice thereof in advance.
(5) The provisions of Article 56, paragraph (4) apply mutatis mutandis to cases where the Corporation has specified the matters prescribed in paragraph (1), changed the purchase period under paragraph (2), and specified the matters prescribed in the preceding paragraph.
(Concerning Taxation)
Article 73 (1) In the event that Depositors, etc. have received the Estimated Proceeds Payment for the deposits and other claims which they hold (excluding those pertaining to the Long-Term Credit Bank Bonds, etc. issued by means of a discount, among those listed in Article 2, paragraph (2), item (v); hereinafter the same shall apply in this Article), if the amount of said Estimated Proceeds Payment (hereinafter referred to as "Amount of Estimated Proceeds Payment" in this Article) is equal to or less than the amount specified by Cabinet Order as the amount of principal of said deposits and other claims on the date of said Estimated Proceeds Payment (hereinafter referred to as "Amount of Principal on the Reference Date" in this Article), the Amount of Estimated Proceeds Payment shall be deemed to be the amount of principal to be repaid with respect to said deposits and other claims, and in the event that the Amount of Estimated Proceeds Payment exceeds the Amount of Principal on the Reference Date, the portion of said Amount of Estimated Proceeds Payment equivalent to said Amount of Principal on the Reference Date shall be deemed to be the amount of principal to be repaid with respect to said deposits and other claims, and the portion of said Amount of Estimated Proceeds Payment that exceeds said Amount of Principal on the Reference Date shall be deemed to be the amount prescribed in each of the following items according to the category of the Deposits, etc. pertaining to said deposits and other claims prescribed in each respective item, in applying the provisions of the Income Tax Act and other laws and regulations concerning income tax:
(i) deposits: interests on said deposits;
(ii) installment savings: compensation money for benefits (meaning the compensation money for benefits specified in Article 174, item (iii) of the Income Tax Act) based on contracts for said installment savings;
(iii) installment deposits specified in Article 2, paragraph (2), item (iii): compensation money for benefits (meaning the compensation money for benefits specified in Article 174, item (iv) of the Income Tax Act) based on contracts for said installment deposits;
(iv) money specified in Article 2, paragraph (2), item (iv): distribution of profits under money trusts prescribed in Article 2, paragraph (2), item (iv) pertaining to said money; and
(v) money specified in Article 2, paragraph (2), item (v): interests on the Long-Term Credit Bank Bonds, etc. (excluding those issued by means of a discount).
(2) In the event that the Depositors, etc. have received payment under the proviso to Article 70, paragraph (2), the amount of money received for deposits and other claims pertaining to said payment (hereinafter referred to as "Amount of Settlement Payment" in this paragraph) shall be deemed to be the amount prescribed in each of the following items according to the category prescribed in such item, in applying the provisions of the Income Tax Act and other laws and regulations concerning income tax:
(i) in the event that the total amount of the Amount of Settlement Payment and the Amount of Estimated Proceeds Payment pertaining to said deposits and other claims (referred to as "Total Amount of Settlement and Estimated Proceeds Payments" in the following items) is equal to or less than the Amount of Principal on the Reference Date pertaining to said deposits and other claims: the amount of principal to be repaid with respect to said deposits and other claims;
(ii) in the event that the Total Amount of Settlement and Estimated Proceeds Payments exceeds the Amount of Principal on the Reference Date pertaining to said deposits and other claims, and the Amount of Estimated Proceeds Payment pertaining to said deposits and other claims is equal to or less than said Amount of Principal on the Reference Date: the amount prescribed in each of the following according to the category of Amount of Settlement Payment specified therein:
(a) within said Amount of Settlement Payment, an amount corresponding to the balance after deducting from said Amount of Principal on the Reference Date said Amount of Estimated Proceeds Payment: an amount of principal to be repaid with respect to said deposits and other claims; and
(b) within said Amount of Settlement Payment, an amount corresponding to the balance after deducting from the Total Amount of Settlement and Estimated Proceeds Payments said Amount of Principal on the Reference Date: an amount of the Deposits, etc. pertaining to said deposits and other claims prescribed in each item of the preceding paragraph according to the category specified in each respective item; and
(iii) in the event that the Amount of Estimated Proceeds Payment pertaining to said deposits and other claims exceeds the Amount of Principal on the Reference Date pertaining to said deposits and other claims: an amount of the Deposits, etc. pertaining to said deposits and other claims prescribed in each item of the preceding paragraph according to the category specified in each respective item.
(3) In the event that the provisions of the preceding two paragraphs shall apply, necessary matters for the application of the special provisions of Article 4-2 and Article 4-3 of the Act on Special Measures Concerning Taxation and other provisions of the preceding two paragraphs shall be specified by Cabinet Order.
Chapter V Management by Financial Administrator
(Injunction Ordering Management of Business and Property)
Article 74 (1) In cases where the Prime Minister (in the event that a Financial Institution pertaining to the injunction prescribed in this paragraph is a labor bank or federation of labor banks, the Prime Minister and the Minister of Health, Labour and Welfare, and in the event that such Financial Institution is The Shoko Chukin Bank, Ltd., the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry; the same shall apply in the following paragraph, paragraph (4) (including the cases where it is applied mutatis mutandis pursuant to paragraph (2) of the following Article), paragraph (5), paragraph (1) of the following Article, Article 77, paragraphs (2) to (4), Article 79, paragraph (1) (including the cases where it is applied mutatis mutandis pursuant to Article 79, paragraph (3)), Article 80, Article 84, paragraph (1), and Article 90) finds that a Financial Institution is unable to satisfy its obligations in full with its assets, or that, in light of the status of its business or assets, a Financial Institution is likely to suspend repayment of Deposits, etc. or a Financial Institution has suspended repayment of Deposits, etc., and that any of the following requirements is satisfied, the Prime Minister may order that the business and property of said Financial Institution be placed under the management of a financial administrator (hereinafter referred to as "Injunction Ordering Management"):
(i) the operation of said Financial Institution's business is extremely inappropriate; or
(ii) if a merger, etc. is not carried out for the Financial Institution pertaining thereto and such Failed Financial Institution abolishes all its businesses or is dissolved, it is likely to cause considerable detriment to the smooth supply and demand of funds and convenience of consumers in the region or fields in which said Failed Financial Institution conducts its business.
(2) Upon receiving notification from a Financial Institution that a situation is likely to arise in which the Financial Institution is unable to satisfy its obligations in full with its assets, the Prime Minister may, when he/she finds that said situation is likely to arise and any of the requirements specified in the preceding paragraph is satisfied, issue the Injunction Ordering Management with respect to said Financial Institution.
(3) A Financial Institution (excluding Failed Financial Institutions) that has become subject to the Injunction Ordering Management under the provisions of the preceding two paragraphs shall be deemed to be a Failed Financial Institution for the purpose of the application of this Act.
(4) Upon issuing the Injunction Ordering Management, the Prime Minister shall give public notice thereof in the official gazette.
(5) A Financial Institution shall, if it is unable to satisfy its obligations in full with its assets or is likely to suspend repayment of Deposits, etc. in light of the status of its business or property, give written notification of such fact and reasons thereof to the Prime Minister.
(Rescission of Injunction Ordering Management)
Article 75 (1) The Prime Minister shall rescind the Injunction Ordering Management, when he/she finds that there is no longer any need for said Injunction Ordering Management.
(2) The provisions of paragraph (4) of the preceding Article apply mutatis mutandis to the case referred to in the preceding paragraph.
(Prohibition of Name Change of Shareholders)
Article 76 (1) In the event that a Financial Institution under Management is a Bank, etc. or The Shoko Chukin Bank, Ltd., the Prime Minister may, when he/she finds it necessary, prohibit any entry of name change of shareholders.
(2) For the purpose of applying the provisions of the preceding paragraph, in the event that a Financial Institution under Management set forth in said paragraph is The Shoko Chukin Bank, Ltd. as prescribed in said paragraph, the term "the Prime Minister" shall be deemed to be "the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry."
(Appointment of Financial Administrator, etc.)
Article 77 (1) When a Injunction Ordering Management has been issued, the right to represent a Financial Institution under Management, execute its business, and manage and dispose of its assets shall be vested exclusively in a financial administrator. The same shall apply to the rights of a director and executive officer (in the event that the Financial Institution under Management is a Shinkin Bank, etc., a director) prescribed in Article 828, paragraphs (1) and (2) of the Companies Act (including the cases where these provisions are applied mutatis mutandis pursuant to Article 28 of the Shinkin Bank Act, Article 52-2 (including the cases where it is applied mutatis mutandis pursuant to Article 58, paragraph (7) of said Act) and Article 61-7 of said Act, Article 32 of the Small and Medium-Sized Enterprises Cooperatives Act, Article 57 (including the cases where it is applied mutatis mutandis pursuant to Article 57-3, paragraph (6) of said Act) and Article 67 of said Act, Article 28 of the Labor Bank Act, Article 57-2 (including the cases where it is applied mutatis mutandis pursuant to Article 62, paragraph (7) of said Act) and Article 65 of said Act), and Article 831 of the Companies Act (including the cases where it is applied mutatis mutandis pursuant to Article 24, paragraph (10) and Article 48-8 of the Shinkin Bank Act, Article 27, paragraph (8), Article 54, Article 82, paragraph (4) and Article 82-10, paragraph (4) of the Small and Medium-Sized Enterprises Cooperatives Act, and Article 24, paragraph (11) and Article 54 of the Labor Bank Act).
(2) The Prime Minister shall, at the time of issuing a Injunction Ordering Management, appoint one or more financial administrator.
(3) The Prime Minister may, when he/she finds it necessary, appoint another financial administrator after the appointment of a financial administrator under the preceding paragraph, or, when he/she finds that the financial administrator has failed to properly manage the business and assets of the Financial Institution under Management, dismiss the financial administrator.
(4) The Prime Minister shall, if he/she has appointed or dismissed a financial administrator under paragraph (2) or the preceding paragraph, notify the Financial Institution under Management to that effect and give public notice thereof in the official gazette.
(5) The provisions of Article 69, Article 70, Article 80, and Article 81, paragraphs (1) and (5) of the Corporate Reorganization Act apply mutatis mutandis to a financial administrator and the provisions of Article 78 of the Act on General Incorporated Associations and General Incorporated Foundations apply mutatis mutandis to a Financial Institution under Management. In this case, the term "the permission of the court" in Article 69, paragraph (1) of the Corporate Reorganization Act shall be deemed to be replaced with "approval from the Prime Minister" (in the event that the Financial Institution under the management of the financial administrator is a labor bank or federation of labor banks, of the Prime Minister and the Minister of Health, Labour and Welfare, and in the event that the Financial Institution is The Shoko Chukin Bank, Ltd., of the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry; the same shall apply hereinafter), the term "trustee representative" in Article 70 of said Act shall be deemed to be replaced with "financial administrator representative," the term "the permission of the court" in Article 70, paragraph (2) of said Act shall be deemed to be replaced with "approval from the Prime Minister," the term "the court" in Article 81, paragraph (1) of said Act shall be deemed to be replaced with "the Prime Minister," the term "trustee representative" in Article 81, paragraph (5) of said Act shall be deemed to be replaced with "financial administrator representative," and the term "representative director and other representatives" in Article 78 of the Act on General Incorporated Associations and General Incorporated Foundations shall be deemed to be replaced with "financial administrator."
Article 78 (1) A corporation may be appointed as a financial administrator or financial administrator representative.
(2) The Corporation may be appointed as a financial administrator or financial administrator representative and carry out the operations thereof.
(Notice and Registration)
Article 79 (1) The Prime Minister shall, when he/she has issued a Injunction Ordering Management or rescinded a Injunction Ordering Management, immediately notify the district court having jurisdiction over the location of the head office or principal office of the Financial Institution under Management to that effect, attach a transcript of the written order to a written commission, and commission its registration in the registry office having jurisdiction over the location of the head office or principal office of the Financial Institution under Management.
(2) The registration under the preceding paragraph shall include the name and address of a financial administrator.
(3) The provisions of paragraph (1) apply mutatis mutandis to cases where any changes occur to the matters specified in the preceding paragraph.
(Submission of Reports or Materials)
Article 80 The Prime Minister may, if he/she finds it necessary, request a financial administrator to submit reports or materials with regard to the status of business and property, etc. of a Financial Institution under Management or order a financial administrator to prepare and submit a plan for its management and take other necessary measures.
(Investigation of Financial Administrator, etc.)
Article 81 (1) A financial administrator may request a director, accounting advisor, corporate auditor, and accounting auditor (in the event that the Financial Institution under Management is a company with committees, a director, executive officer, accounting advisor and accounting auditor, and in the event that the Financial Institution under Management is a Shinkin Bank, etc., a director, inspector and accounting auditor; the same shall apply in Article 87, paragraph (5)), manager (in the event that the Financial Institution under Management is a credit cooperative, the Federation of Credit Cooperatives, labor bank or federation of labor banks, a counselor), and any other employee of a Financial Institution under Management, a Financial Institution Agent or the other party to a contract pertaining to the agency or intermediary prescribed in Article 2, paragraph (4) of the Shoko Chukin Bank Limited Act of The Shoko Chukin Bank, Ltd. (limited to the case where it is a Financial Institution under Management; hereinafter the same shall apply in this paragraph) (in the event that the Financial Institution Agent or the other party to a contract pertaining to the agency or intermediary prescribed in Article 2, paragraph (4) of the Shoko Chukin Bank Limited Act is a corporation, an officer and employee) having a Financial Institution under Management as its Principal Financial Institution, and a person who previously held any of these positions (with regard to any person who previously held any of these positions, limited to those items pertaining to matters that could have been known by him/her during the period when he/she was engaged in the operations of the Financial Institution under Management) to report on the status of business and assets of the Financial Institution under Management, or inspect the books, documents, and any other items of the Financial Institution under Management and the Financial Institution Agent having the Financial Institution under Management as its Principal Financial Institution or the other party to a contract pertaining to the agency or intermediary prescribed in said paragraph of The Shoko Chukin Bank, Ltd.
(2) A financial administrator may, if it is necessary for carrying out his/her duties, inquire with, or request the cooperation of, government agencies, public entities, or any other person.
(Confidentiality Obligation of Financial Administrator, etc.)
Article 82 (1) A financial administrator and financial administrator representative (hereinafter referred to as "Financial Administrator, etc." in this Article) shall not divulge any secret which may have come to his/her knowledge in the course of his/her duties. The same shall apply after a financial administrator, etc. resigns from office.
(2) If a financial administrator, etc. is a corporation, its officers and staff who are engaged in the duty of the financial administrator, etc. shall not divulge any secret which may have come to his/her knowledge in the course of his/her duties. The same shall apply after said officers or staff members are no longer engaged in the duties of the financial administrator, etc.
(Measures to Clarify Liability of Management, etc. for Failure of a Financial Institution under Management.)
Article 83 (1) A financial administrator shall, in order to have a director, accounting advisor, corporate auditor or accounting auditor of a Financial Institution under Management (a director, executive officer, accounting advisor or accounting auditor in the event that the Financial Institution under Management is a company with committees, and a director, inspector or accounting auditor in the event that the Financial Institution under Management is a Shinkin Bank, etc.) or a person who previously held any of these positions perform civil liability based on a breach of obligations in the course of duties, file an action or take other necessary measures.
(2) A financial administrator shall, when by carrying out his/her duty he/she believes that an offense has been committed, take necessary measures toward filing an accusation.
(Transactions between Financial Administrator and Financial Institution under Management)
Article 84 (1) A financial administrator shall obtain approval from the Prime Minister when carrying out, for himself/herself or for a third party, any transaction with a Financial Institution under Management. In this case, Article 108 of the Civil Code shall not apply.
(2) An act shall be null and void if the approval set forth in the preceding paragraph has not been obtained; provided, however, that it may not be duly asserted against a third party without knowledge of the requirement to obtain such approval.
Article 85 Deleted.
(Special Provisions on Extraordinary Resolutions, etc. of Shareholders Meeting, etc.)
Article 86 (1) In a Financial Institution under Management, resolutions by a shareholders meeting or class meeting specified in Article 309, paragraph (2), item (iii) of the Companies Act (limited to the part pertaining to Article 171, paragraph (1) of said Act) through item (v) of said paragraph, (ix), (xi), or (xii) of said paragraph, or Article 324, paragraph (2), item (i) or (iv) of said Act, resolutions or decisions under Article 48-3 of the Shinkin Bank Act, Article 53 of the Small and Medium-Sized Enterprises Cooperatives Act, or Article 53 of the Labor Bank Act, and resolutions or decisions under Article 22, paragraph (2) (including the cases where it is applied mutatis mutandis pursuant to paragraph (5) of said Article), Article 29, paragraph (4) (including the cases where it is applied mutatis mutandis pursuant to paragraph (5) of said Article) or Article 35, paragraph (2) of the Act on Financial Institutions' Merger and Conversion may, notwithstanding these provisions, be made provisionally by two-thirds or more of the votes held by the shareholders, members, association members, substitute members, or representatives (referred to in paragraph (4) as "Shareholders, etc.") present.
(2) In a Financial Institution under Management, resolutions of a shareholders meeting or class meeting specified in each item of Article 309, paragraph (3) or Article 324, paragraph (3) of the Companies Act and resolutions under Article 22, paragraph (3) (including the cases where it is applied mutatis mutandis pursuant to paragraph (5) of said Article) of the Act on Financial Institutions' Merger and Conversion may, notwithstanding these provisions, be made provisionally by a majority of the shareholders present and two-thirds or more of the votes held by the shareholders present.
(3) In a Financial Institution under Management, resolutions of a shareholders meeting under Article 309, paragraph (4) of the Companies Act may, notwithstanding the provisions of the same paragraph, be made provisionally by a majority of the shareholders present and three-quarters or more of the votes held by the shareholders present.
(4) In the event that a resolution or decision is provisionally made under paragraph (1) (hereinafter referred to as "Provisional Resolution, etc." in this paragraph and the following paragraph), the Financial Institution under Management shall notify its Shareholders, etc. of the purpose of said Provisional Resolution, etc. and shall call a subsequent shareholders meeting, etc. (meaning the shareholders meeting, etc. prescribed in Article 66, paragraph (2); the same shall apply in the following paragraph and paragraph (6) of the following Article) within one month of the date of adoption of said Provisional Resolution, etc.
(5) In the event that a Provisional Resolution is approved by a majority as prescribed in paragraph (1) at a shareholders meeting, etc. under the preceding paragraph, a resolution or decision pertaining to the matters of said Provisional Resolution, etc. shall be deemed to have existed when said approval was given.
(6) The provisions of the preceding two paragraphs apply mutatis mutandis to cases where a resolution is provisionally made under paragraph (2). In this case, the term "a majority prescribed in paragraph (1)" in the preceding paragraph shall be deemed to be replaced with "a majority as prescribed in paragraph (2)."
(7) The provisions of paragraphs (4) and (5) apply mutatis mutandis to cases where a resolution is provisionally made under paragraph (3). In this case, the term "a majority as prescribed in paragraph (1)" in paragraph (5) shall be deemed to be replaced with "a majority as prescribed in paragraph (3)."
(Permission in Lieu of Extraordinary Resolution of Shareholders Meeting, etc.)
Article 87 (1) In the event that a Financial Institution under Management that is a Bank, etc. or The Shoko Chukin Bank, Ltd. is unable to satisfy its obligations in full with its assets, said Financial Institution under Management may, notwithstanding the provisions of Article 111, paragraph (2), Article 171, paragraph (1), Article 199, paragraph (2), Article 447, paragraph (1), Article 466, Article 467, paragraph (1), items (i) and (ii), Article 471, item (iii), Article 783, paragraph (1), and Article 804, paragraph (1) of the Companies Act, carry out the following matters with the permission of the court:
(i) amendment of the articles of incorporation necessary for the issuance of Class Shares Subject to Wholly Call (meaning the class shares subject to wholly call prescribed in Article 171, paragraph (1) of the Companies Act; the same shall apply in Article 126-13, paragraph (1), item (i)), acquisition of all of said Class Shares Subject to Wholly Call, or determination of the subscription requirements prescribed in Article 199, paragraph (2) of said Act pertaining to the issuance of the shares for subscription prescribed in paragraph (1) of said Article conducted together with such acquisition;
(ii) reduction in the amount of stated capital;
(iii) assignment of all or a material portion of its business;
(iv) dissolution; and
(v) company split.
(2) In the event that a Financial Institution under Management that is a Shinkin Bank, etc. is unable to satisfy its obligations in full with its assets, said Financial Institution under Management may, notwithstanding the provisions of Article 48-3 and Article 58, paragraph (1) of the Shinkin Bank Act, Article 53 and Article 57-3, paragraph (1) of the Small and Medium-Sized Enterprises Cooperatives Act, and Article 53 and Article 62, paragraph (1) of the Labor Bank Act, carry out the following matters with permission by the court:
(i) dissolution; and
(ii) assignment of its business.
(3) Notwithstanding the provisions of Article 339, paragraph (1) and Article 403, paragraph (1) of the Companies Act (including the cases where it is applied mutatis mutandis pursuant to the provisions of Article 347, paragraph (1) of said Act), Article 35-8, paragraph (1), of the Shinkin Bank Act, Article 42, paragraph (1) of the Small and Medium-Sized Enterprises Cooperatives Act, and Article 37-6, paragraph (1) of the Labor Bank Act, a financial administrator may, with the permission of the court, dismiss a director, accounting advisor, corporate auditor or accounting auditor of a Financial Institution under Management (in the event that the Financial Institution under Management is a company with committees, a director, executive officer, accounting advisor or accounting auditor, and in the event that the Financial Institution under Management is a Shinkin Bank, etc., a director, inspector or accounting auditor; the same shall apply in the following paragraph).
(4) In the event that a financial administrator intends to dismiss any director, accounting advisor, corporate auditor or accounting auditor of a Financial Institution under Management under the preceding paragraph, if the number of directors, accounting advisors, corporate auditors or accounting auditors fails to meet the number prescribed by an Act or by the articles of incorporation, the financial administrator may, notwithstanding the provisions of Article 329, paragraph (1) and Article 402, paragraph (2) of the Companies Act, Article 32, paragraph (3) of the Shinkin Bank Act, Article 35, paragraph (3) of the Small and Medium-Sized Enterprises Cooperatives Act, and Article 32, paragraph (3) of the Labor Bank Act, appoint a director, accounting advisor, corporate auditor or accounting auditor of the Financial Institution under Management with permission from the court.
(5) The director, accounting advisor, corporate auditor and accounting auditor of a Financial Institution under Management appointed under the preceding paragraph shall resign at the conclusion of the first annual shareholders meeting or ordinary general meeting (in cases where a general meeting of representatives is established, at which it is possible to appoint officers, the ordinary general meeting of representatives) convened after the conclusion of the management by the financial administrator pertaining to said Financial Institution under Management, and an executive officer shall resign at the completion of the first meeting of the board of directors held after said annual shareholders meeting.
(6) When the permission prescribed in paragraphs (1) to (4) has been granted (hereinafter referred to as "Substituted Permission" in this Article and the following Article), it shall be deemed that a resolution of a shareholders meeting, etc. or board of directors meeting has been adopted concerning matters pertaining to said Substituted Permission.
(7) The district court having jurisdiction over the location of the head office or principal office of a Financial Institution under Management shall have jurisdiction over cases pertaining to the Substituted Permission.
(8) The court shall, when it has made a Substituted Permission, serve a written decision thereof on the Financial Institution under Management and give public notice of the gist of the decision.
(9) The public notice under the preceding paragraph shall be published in the official gazette.
(10) A decision on the Substituted Permission shall take effect as from the time of service thereof on the Financial Institution under Management under paragraph (8).
(11) Shareholders, members, or association members may make an immediate appeal against a decision on the Substituted Permission within an unextendable period of two weeks from the date of the public notice set forth in paragraph (8). In this case, if the immediate appeal is against a decision on the Substituted Permission pertaining to dissolution, it shall have the effect of a stay of execution.
(12) The provisions of Article 5, Article 6, Article 7, paragraph (2), Article 40, Article 41, Article 56, paragraph (2), and Article 66, paragraphs (1) and (2) of the Non-Contentious Cases Procedures Act (Act No. 51 of 2011) shall not apply to cases pertaining to the Substituted Permission.
(Special Provisions for Registration Pertaining to Substituted Permission)
Article 88 In the event that a Substituted Permission pertaining to matters specified in paragraph (1), item (i), (ii), (iv), or (v) or paragraph (2), item (i) of the preceding Article or matters prescribed in paragraph (3) or (4) of the preceding Article, a transcript or extract of a written decision of said Substituted Permission shall be attached to a written application for registration pertaining to said matters.
(Special Provisions for Procedures for Protection of Creditors)
Article 89 In the event that a Financial Institution under Management that is a Bank, etc. or The Shoko Chukin Bank, Ltd. has adopted a resolution for reduction in the amount of stated capital, the notice prescribed in Article 449, paragraph (2) of the Companies Act shall not be required to be given to the Depositors, etc. or any other creditors specified by Cabinet Order.
(Conclusion of Management)
Article 90 A financial administrator shall conclude the management of a Financial Institution under Management by transferring its business or taking other measures within one year from the date of the Injunction Ordering Management; provided, however, that in cases where it is impossible to conclude the management within said period due to unavoidable circumstances, said period may be extended for a period not exceeding one year with approval from the Prime Minister.
Chapter VI Succession of Business of Failed Financial Institutions
(Decision to Establish Bridge Bank)
Article 91 (1) The Prime Minister may, when he/she finds it necessary to use a Bridge Bank for the succession of business of a Financial Institution under Management (meaning the succession of business by a Bridge Bank through the assumption of business, etc. and the provisional maintenance and continuation of said business by the Bridge Bank; hereinafter the same shall apply in this Chapter), make the following decisions:
(i) that a Bridge Bank be established by the Corporation as a subsidiary company to carry out the Assumption of Business, etc. in order to succeed to the business of a Financial Institution under Management; and
(ii) that a Bridge Bank should carry out the Assumption of Business, etc. in order to succeed to the business of a Financial Institution under Management.
(2) The Prime Minister may, when he/she finds it necessary, rescind or modify a decision under the preceding paragraph.
(3) A financial administrator may, when he/she finds it necessary, request the Prime Minister to make a decision under paragraph (1) or the preceding paragraph.
(Establishment of Bridge Bank, etc.)
Article 92 (1) When a decision prescribed in paragraph (1), item (i) of the preceding Article is made under paragraph (1) or (2) of the preceding Article, the Corporation shall, following a resolution by the Policy Board on the details of contribution pertaining to said decision, become the incorporator of a stock company that is to become a Bridge Bank, and provide contribution for the incorporation of said stock company as a subsidiary company of the Corporation.
(2) In addition to the case prescribed in the preceding paragraph, any contribution by the Corporation to the Bridge Bank shall require a resolution by the Policy Board.
(3) Upon providing the contribution prescribed in the preceding two paragraphs, the Corporation shall promptly report the details thereof to the Prime Minister and the Minister of Finance.
(Confirmation of Succeeded Assets)
Article 93 (1) When a decision specified in Article 91, paragraph (1), item (ii) is made under Article 91, paragraph (1) or (2), a financial administrator of the Financial Institution under Management shall select loan claims and other assets of said Financial Institution under Management to be succeeded to by the Bridge Bank pursuant to the succession of business prescribed in Article 91, paragraph (1) and request the Prime Minister to confirm that they are appropriate assets to be held by the Bridge Bank.
(2) Upon receiving the request prescribed in the preceding paragraph, the Prime Minister shall carry out the confirmation under the preceding paragraph from the viewpoint of facilitating the smooth succession of business and ensuring the sound and appropriate operation of the business of the Bridge Bank.
(3) The Prime Minister and the Minister of Finance shall prescribe standards in advance for carrying out the confirmation under the preceding paragraph and make the standards public.
(4) The standards prescribed in the preceding paragraph shall include standards concerning the status of performance by an obligor of obligations pertaining to claims subject to the confirmation prescribed in paragraph (2).
(Management of Bridge Bank)
Article 94 (1) The Corporation shall manage the Bridge Bank to ensure the proper performance of the following matters:
(i) to carry out the Assumption of Business, etc. in order to succeed to the business of the Financial Institution under Management that is subject to said decision, when a decision specified in Article 91, paragraph (1), item (ii) is made under Article 91, paragraph (1) or (2);
(ii) to succeed to the assets that have been confirmed under paragraph (2) of the preceding Article as appropriate assets to be held by a Bridge Bank; and
(iii) to comply with the guidelines prescribed in the following paragraph in administering the receipt and payment of the Deposits, etc., loaning funds, and carrying out other operations.
(2) The Corporation shall prepare guidelines for the administration of receipt and payment of the Deposits, etc., loan of funds, and other operations of a Bridge Bank in accordance with the following and, following approval from the Prime Minister, make such guidelines public:
(i) the guidelines shall be prepared, taking into account that the purpose of a Bridge Bank is to facilitate the provisional maintenance and continuation of the administration of receipt and payment of the Deposits, etc., loan of funds, and other operations, giving consideration to ensuring consistency with the standards prescribed in paragraph (3) of the preceding Article, and with a view to ensuring the sound and appropriate operation of the business of a Bridge Bank; and
(ii) the guidelines shall include a statement of matters approved by the Corporation concerning transactions designated by the Corporation among the loan of funds and other operations to be carried out by a Bridge Bank.
(3) The Corporation may give instructions and advice necessary for the management of a Bridge Bank.
(Cases Where Approval for Business Transfer, etc. Is not Required)
Article 95 The provisions of Article 467, paragraph (1) of the Companies Act (limited to the part pertaining to item (v)) shall not apply to the assets for which confirmation has been rendered under Article 93, paragraph (2) in the event that all of the issued shares of the Bridge Bank are held by the Corporation.
(Conclusion of Management, etc.)
Article 96 (1) The Corporation shall conclude the management of a Bridge Bank within two years from the date of the Injunction Ordering Management of the first Financial Institution under Management for which the Bridge Bank receives the transfer of business by taking the following measures; provided, however, that if said management cannot be concluded within said period due to unavoidable circumstances, the time limit may be extended for a period not exceeding one year:
(i) the merger of said Bridge Bank (limited to a merger where the corporation surviving said merger or corporation established by the merger is not a subsidiary company of the Corporation);
(ii) transfer of the whole of the business of said Bridge Bank;
(iii) transfer of shares of said Bridge Bank (limited to a transfer through which the Bridge Bank will cease to be a subsidiary company of the Corporation);
(iv) company split of said Bridge Bank (limited to a company split where another company or a company established through the company split succeeds to all of the rights and obligations held by said Bridge Bank in relation to its business through the company split, and where said other company or said company established through the company split is neither a subsidiary company of the Corporation nor a Subsidiary Company of the Bridge Bank); and
(v) Dissolution of said Bridge Bank by resolution of shareholders meeting.
(2) The Corporation shall, if it intends to conclude management under the main clause of the preceding paragraph or extend the time limit under the proviso to the preceding paragraph, obtain approval from the Prime Minister.
(3) The Corporation shall, when it has concluded the management of a Bridge Bank under paragraph (1) or transferred or made another disposition of shares of a Bridge Bank (including a bank that was formerly a Bridge Bank) (excluding those specified in paragraph (1), item (iii)), shall promptly report to that effect to the Prime Minister and the Minister of Finance.
(4) The "Subsidiary Company of the Bridge Bank" set forth in paragraph (1), item (iv) means a company of which voting rights exceeding fifty hundredths of the voting rights held by all of its shareholders (excluding voting rights relating to shares held by shareholders who may not exercise their voting rights for all of the matters which may be resolved at a shareholders meeting but including voting rights relating to shares for which holders are deemed to have voting rights pursuant to the provisions of Article 879, paragraph (3) of the Companies Act; hereinafter the same shall apply in this paragraph and Article 120, paragraph (5)) are held by the Bridge Bank.
(Succession Agreement)
Article 97 (1) The Corporation shall conclude an agreement with the Bridge Bank including the following matters (hereinafter referred to as "Succession Agreement" in this Chapter):
(i) the Bridge Bank that has concluded the Succession Agreement (hereinafter referred to as "Contracted Bridge Bank") shall carry out the matters specified in each item of Article 94, paragraph (1);
(ii) the Contracted Bridge Bank may apply to have the Corporation purchase the assets of the Contracted Bridge Bank; and
(iii) the Contracted Bridge Bank shall, if it seeks to conclude a contract concerning the borrowing of funds subject to the guarantee of obligations prescribed in paragraph (1) of the following Article, obtain approval from the Corporation for the contents of such contract.
(2) Upon concluding the Succession Agreement, the Corporation shall immediately report the details thereof to the Prime Minister and the Minister of Finance.
(Guarantee of Loan of Funds and Obligations)
Article 98 (1) In the event that the Corporation has received an application from a Contracted Bridge Bank for a loan of funds necessary to ensure the smooth execution of its business or for a guarantee of obligations pertaining to the borrowing of such funds by the Contracted Bridge Bank, the Corporation may, when it finds it necessary, provide said loan or guarantee of obligations, following a resolution by the Policy Board.
(2) When the Corporation has concluded a contract with a Contracted Bridge Bank under the preceding paragraph for a loan or guarantee of obligations prescribed therein, the Corporation shall immediately report the details of the contract to the Prime Minister and the Minister of Finance.
(Compensation for Loss)
Article 99 When any loss is caused to a Contracted Bridge Bank, the amount of which is calculated pursuant to the provisions of Cabinet Order, as a result of operations carried out under the Succession Agreement, the Corporation may, following a resolution by the Policy Board, compensate the Contracted Bridge Bank for said loss within the scope of the amount prescribed in said Cabinet Order.
(Request for Report)
Article 100 The Corporation may, when it finds it necessary for carrying out the operations prescribed in this Chapter, request the Bridge Bank to report on the implementation of the Succession Agreement or financial conditions in connection therewith.
(Financial Assistance to Re-succeeding Financial Institution, etc.)
Article 101 (1) A Financial Institution that is undertaking a re-succession to business and is not a Bridge Bank (hereinafter referred to as "Re-succeeding Financial Institution" in this Article), or a Bank Holding Company, etc. undertaking a re-succession to business (hereinafter referred to as a "Re-succeeding Bank Holding Company, etc." in this Article) may apply to have the Corporation provide Financial Assistance (limited to that specified in Article 59, paragraph (1), item (iii), (vi) or (vii)) to support the re-succession to business.
(2) The term "re-succession to business" as used in the preceding paragraph means the following:
(i) a merger in which a Financial Institution that merges with a Bridge Bank survives;
(ii) a merger in which a Financial Institution is established through the merger of a Bridge Bank and another Financial Institution;
(iii) a transfer by a Bridge Bank of the whole of its business (in the event that the Corporation purchases part of the assets of said Bridge Bank, excluding the portion pertaining to such assets to be purchased) to another Financial Institution;
(iv) the acquisition of shares of a Bridge Bank by another Financial Institution or Bank Holding Company, etc. conducted to carry out matters specified by the Prime Minister and the Minister of Finance as the matters necessary to ensure sound and appropriate operation of the business of said Bridge Bank;
(v) an absorption-type company split to which a Bridge Bank is a party where another Financial Institution succeeds to all of the rights and obligations held by the Bridge Bank in relation to its business (in the event that the Corporation purchases part of the assets of said Bridge Bank, excluding the portion pertaining to such assets to be purchased) through said absorption-type company split; and
(vi) an incorporation-type company split to which a Bridge Bank is a party where the Financial Institution newly established through said incorporation-type company split succeeds to all of the rights and obligations held by the Bridge Bank in relation to its business (in the event that the Corporation purchases part of the assets of said Bridge Bank, excluding the portion pertaining to such assets to be purchased) through said absorption-type company split.
(3) The purchase of assets prescribed in paragraph (1) shall be conducted with respect to the assets prescribed in each of the following items according to the category of the re-succession of business specified in each respective item:
(i) a merger specified in item (i) of the preceding paragraph: the assets of the Financial Institution surviving through the merger (limited to those that were the assets of the Bridge Bank prior to the merger);
(ii) a merger specified in item (ii) of the preceding paragraph: the assets of the Financial Institution that will be established by the merger (limited to those that were the assets of the Bridge Bank prior to the merger);
(iii) transfer of the business specified in item (iii) of the preceding paragraph: the assets of another Financial Institution prescribed in said item that have been received through the transfer of said business;
(iv) the acquisition of shares specified in item (iv) of the preceding paragraph: the assets of the bank whose shares have been acquired;
(v) the absorption-type company split specified in item (v) of the preceding paragraph: the assets of another Financial Institution set forth in said item which said Financial Institution has succeeded to through the absorption-type company split; and
(vi) the incorporation-type company split specified in item (vi) of the preceding paragraph: the assets of the Financial Institution established through the incorporation-type company split (limited to those that were assets of the Bridge Bank prior to the incorporation-type company split).
(4) The Securing of Damage prescribed in paragraph (1) shall be conducted with respect to loan claims that are the assets prescribed in each item of the preceding paragraph according to the category of the re-succession to business specified in each respective item of the preceding paragraph.
(5) The provisions of Article 59, paragraphs (3), (6) and (7) and Article 61, paragraph (1) apply mutatis mutandis to the application prescribed in paragraph (1), and the provisions of Article 61, paragraphs (2) to (4) and (6) to (8) apply mutatis mutandis to the authorization prescribed in Article 61, paragraph (1) as applied mutatis mutandis pursuant to this paragraph. In this case, the term "Assuming Financial Institution" in Article 59, paragraph (3) shall be deemed to be replaced with "Re-succeeding Financial Institution," and the terms "merger, etc.," "Failed Financial Institution," "Assuming Financial Institution," and "Assuming Bank Holding Company, etc." in Article 61 shall be deemed to be replaced with "re-succession to business," "Bridge Bank," "Re-succeeding Financial Institution," and "Re-succeeding Bank Holding Company, etc.," respectively.
(6) Even in cases where no application is made under Article 61, paragraph (2) as applied mutatis mutandis pursuant to the preceding paragraph, the Prime Minister may, when he/she finds that a Bridge Bank satisfies the requirements specified in paragraph (3), item (iii) as applied mutatis mutandis pursuant to the preceding paragraph, provide mediation in writing with regard to the re-succession to business (excluding the merger specified in paragraph (2), item (ii) and limited to those that contribute to the protection of Depositors, etc. and other creditors and for which Financial Assistance by the Corporation is indispensable) between said Bridge Bank and another Financial Institution or said Bridge Bank and a Bank Holding Company, etc.
(7) The provisions of Article 62, paragraphs (2) and (4) to (6) apply mutatis mutandis to the mediation prescribed in the preceding paragraph, the provisions of Article 64 (excluding paragraph (2)) and Article 64-2 apply mutatis mutandis to the application prescribed in paragraph (1), the provisions of Article 65 and Article 66 apply mutatis mutandis to the Financial Institution or Bank Holding Company, etc. that has received the authorization prescribed in Article 61, paragraph (1) as applied mutatis mutandis pursuant to paragraph (5) or that has received the mediation prescribed in the preceding paragraph, the provisions of Article 67 apply mutatis mutandis to the Re-succeeding Financial Institution, the provisions of Article 68 apply mutatis mutandis to the Financial Assistance provided by the Corporation for re-succession to business, and the provisions of Article 68-2 and Article 68-3 apply mutatis mutandis to the Re-succeeding Financial Institution that has received said Financial Assistance (limited to those pertaining to the Subscription for Preferred Shares, etc.) (including the Financial Institutions established by the merger or incorporation-type company split pertaining to said Subscription for Preferred Shares, etc.) or the Re-succeeding Bank Holding Company, etc. (including the company prescribed in Article 68-2, paragraph (2) as applied mutatis mutandis pursuant to this paragraph in the event that the approval prescribed in Article 68-2, paragraph (1) as applied mutatis mutandis pursuant to this paragraph is granted, and the bridge Financial Institution, etc. prescribed in Article 68-3, paragraph (4) as applied mutatis mutandis pursuant to this paragraph in the event that the approval prescribed in Article 68-3, paragraph (1) as applied mutatis mutandis pursuant to this paragraph is granted). In this case, the term "Article 59, paragraph (1) or Article 59-2, paragraph (1)" in Article 62, paragraph (2) shall be deemed to be replaced with "Article 101, paragraph (1)," the term "paragraphs (4) to (7)" in Article 62, paragraph (4) shall be deemed to be replaced with "paragraphs (4), (6) and (7)," the term "a Failed Financial Institution or a Financial Institution recognized as having a high probability of becoming a Failed Financial Institution" in Article 62, paragraph (5) shall be deemed to be replaced with "Bridge Bank," the term "merger, etc." in Article 64, paragraph (3) and (5) shall be deemed to be replaced with "re-succession to business," the term "Assuming Financial Institution" and "Assuming Bank Holding Company, etc." in Article 64-2, paragraphs (1) and (2) shall be deemed to be replaced with "Re-succeeding Financial Institution" and "Re-succeeding Bank Holding Company, etc.," respectively, and the term "merger, etc." in said paragraph shall be deemed to be replaced with "re-succession to business," the terms "merger, etc. (limited to those specified in Article 59, paragraph (2), item (ii)" and "said merger, etc." in Article 64-2, paragraph (4) shall be deemed to be replaced with "re-succession to business (limited to those specified in Article 101, paragraph (2), item (ii)" and "said re-succession to business," respectively, the terms "Assuming Financial Institution" and "Assuming Bank Holding Company, etc." in Article 64-2, paragraph (5) shall be deemed to be replaced with "Re-succeeding Financial Institution" and "Re-succeeding Bank Holding Company, etc.," respectively, and the term "merger, etc." in Article 65 and Article 68 shall be deemed to be replaced with "re-succession to business," and any other necessary technical replacement of terms shall be specified by Cabinet Order.
Chapter VI-2 Purchase of Specified Claims That Are Difficult to Collect Held by Financial Institution
Article 101-2 (1) In order to contribute to the maintenance of an orderly credit system through ensuring the soundness of financial conditions of Financial Institutions, the Corporation may purchase loan claims or assets specified by Cabinet Office Ordinance and Ordinance of the Ministry of Finance as being equivalent thereto (hereinafter simply referred to as "Loan Claims" in this paragraph) which are held by a Financial Institution (excluding a Failed Financial Institution, a Bridge Bank, the Bank Under Special Crisis Management prescribed in Article 111, paragraph (2), the Financial Institution subject to Specified Confirmation prescribed in Article 126-2, paragraph (1), item (ii) pertaining to the Specified Measures Under Item (ii) prescribed in said paragraph, and a Specified Bridge Bank; hereinafter the same shall apply in this Article) and of which the obligor or guarantor is a Crime Syndicate Member (meaning the crime syndicate member prescribed in Article 2, item (vi) of the Act on Prevention of Unjust Acts by Organized Crime Group Members (Act No. 77 of 1991)) and for which there is a risk of non-compliance with the contract pertaining to said Loan Claims, a likelihood that an act that will cause hindrance to the participation in an auction of secured real property pertaining to said Loan Claims will be conducted, or any other special circumstances that are likely to make it difficult for a Financial Institution to take necessary measures that should normally be implemented for collecting the Loan Claims (hereinafter referred to as "Specified Claims That Are Difficult to Collect").
(2) In cases where the Corporation is to purchase Specified Claims That Are Difficult to Collect under the preceding paragraph, it shall comply with standards prescribed and publicly announced in advance by the Prime Minister and the Minister of Finance.
(3) Upon receiving an application for the purchase of Specified Claims That Are Difficult to Collect from a Financial Institution, the Corporation shall, following a resolution of the Policy Board, decide without delay whether or not to carry out the purchase of Specified Claims That Are Difficult to Collect pertaining to said application.
(4) Upon making a decision under the preceding paragraph, the Corporation shall immediately report matters pertaining to the decision to the Prime Minister and the Minister of Finance.
(5) Upon making a decision to purchase Specified Claims That Are Difficult to Collect under paragraph (3), the Corporation shall conclude a contract for the purchase of the Specified Claims That Are Difficult to Collect with said Financial Institution.
Chapter VII Measures against a Financial Crisis
(Confirmation of Necessity for Measures against a Financial Crisis)
Article 102 (1) When the Prime Minister finds that, if the measures specified in each of the following items are not taken with respect to the Financial Institution specified in each respective item, it may extremely seriously hinder the maintenance of an orderly credit system in Japan or in a certain region where said Financial Institution conducts its business, he/she may, following deliberation by a council for financial crises (hereinafter referred to as the "Council" in this Chapter through Chapter VIII), confirm the necessity to take said measures (hereinafter referred to as "Confirmation" in this Chapter):
(i) a Financial Institution (excluding the Financial Institution specified in the following item): the Subscription for Shares, etc. of said Financial Institution by the Corporation for the purpose of enhancing the adequacy of equity capital of said Financial Institution or subscription for shares issued by a Bank Holding Company, etc. (limited to those specified in Article 2, paragraph (5), item (i) or (iii); hereinafter the same shall apply through to Article 108-3) having said Financial Institution as its subsidiary company (meaning the subsidiary company prescribed in Article 2, paragraph (8) of the Banking Act or the subsidiary company prescribed in Article 13-2, paragraph (2) of the Long-Term Credit Bank Act; hereinafter the same shall apply through to Article 108-3) (hereinafter referred to as the "Measures Under Item (i)" in this Chapter);
(ii) a Failed Financial Institution or a Financial Institution that is unable to satisfy its obligations in full with its assets: the Financial Assistance for an amount that is expected to exceed the expected costs for the payment of insurance proceeds with respect to an insurable contingency of said Financial Institution (hereinafter referred to as the "Measures Under Item (ii)" in this Chapter); and
(iii) a Bank, etc. falling under a Failed Financial Institution that is unable to satisfy its obligations in full with its assets: the measures prescribed in Article 111 to Article 119 (hereinafter referred to as the "Measures Under Item (iii)" in this Chapter).
(2) If the Prime Minister intends to give Confirmation with respect to a labor bank or federation of labor banks, he/she shall hear the opinion of the Minister of Health, Labour and Welfare in advance, and if he/she intends to give Confirmation with respect to The Shoko Chukin Bank, Ltd., he/she shall hear the opinion of the Minister of Economy, Trade and Industry in advance.
(3) Where the Prime Minister intends to give the Confirmation with respect to any of the Financial Institutions listed in the items of paragraph (1) which is specified by Cabinet Office Ordinance and Ordinance of the Ministry of Finance, if the Financial Institution subject to the Confirmation has issued bonds (limited to bonds with a special clause of subordinated contents with regard to the payment of principal and interest, where the obligations pertaining to said bonds will be written down or will be acquired by the Financial Institution on condition that the Confirmation will be given, and which are specified by Cabinet Office Ordinance and Ordinance of the Ministry of Finance as bonds that contribute to ensuring the soundness of financial conditions in light of the standards on the appropriateness of the adequacy of equity capital and any other financial conditions specified based on the Banking Act and any other laws and regulations) or shares (limited to shares with preferred contents with regard to dividend of surplus and distribution of residual assets, which will be acquired by the Financial Institution on condition that the Confirmation will be given, and which are specified by Cabinet Office Ordinance and Ordinance of the Ministry of Finance as shares that contribute to ensuring the soundness of financial conditions in light of the standards on the appropriateness of the adequacy of equity capital and any other financial conditions specified based on the Banking Act and any other laws and regulations), or has concluded loans for consumption (limited to loans with a special clause of subordinated contents with regard to the payment of principal and interest, where the obligations pertaining to said loans for consumption will be written down or the claims pertaining to said loans for consumption will be acquired by the Financial Institution on condition that the Confirmation will be given, and which are specified by Cabinet Office Ordinance and Ordinance of the Ministry of Finance as loans for consumption that contribute to ensuring the soundness of financial conditions in light of the standards on the appropriateness of the adequacy of equity capital and any other financial conditions specified based on the Banking Act and any other laws and regulations), he/she shall decide on the treatment of said bonds, said shares, or said loans for consumption in the equity capital of the Financial Institution.
(4) Confirmation pertaining to the Measures Under Item (iii) may not be given unless the Prime Minister finds that the Measures Under Item (ii) cannot prevent the hindrance prescribed in paragraph (1).
(5) When giving Confirmation pertaining to the Measures Under Item (i), the Prime Minister shall specify a period of time within which an application under Article 105, paragraph (1) or (2) can be made by a Financial Institution subject to said Confirmation or Bank Holding Company, etc. which has said Financial Institution as its subsidiary company.
(6) Upon giving Confirmation, the Prime Minister shall announce such fact and, if the Confirmation is in relation to the Measures Under Item (i), the period of time specified under the preceding paragraph, to the Financial Institution subject to said Confirmation or Bank Holding Company, etc. which has said Financial Institution as its subsidiary company and the Corporation, and give public notice thereof in the official gazette.
(7) Upon making a decision pursuant to paragraph (3), the Prime Minister shall make the details thereof public.
(8) Upon giving Confirmation, the Prime Minister shall report the details of said Confirmation to the Diet.
(Rescission of Confirmation Pertaining to Measures Under Item (i))
Article 103 (1) If, between the time of Confirmation pertaining to the Measures Under Item (i) and the decision under Article 105, paragraph (4), a Financial Institution subject to said Confirmation comes to fall under the Financial Institution specified in paragraph (1), item (ii) of the preceding Article, the Prime Minister shall, following deliberation by the Council, rescind said Confirmation.
(2) The provisions of paragraphs (2), (6), and (8) of the preceding Article apply mutatis mutandis to the rescission of the Confirmation under the preceding paragraph.
(Submission of Plan Specifying Measures to Enhance the Adequacy of Equity Capital, etc.)
Article 104 (1) A Financial Institution subject to Confirmation pertaining to the Measures Under Item (i) shall, if said Financial Institution and Bank Holding Company, etc. which has said Financial Institution as its subsidiary company do not make an application prescribed in paragraph (1) or (2) of the following Article, submit a plan to the Prime Minister within the period prescribed in Article 102, paragraph (5), setting forth measures to enhance the adequacy of equity capital by a method other than the Measures Under Item (i).
(2) When the Prime Minister finds that the plan submitted under the preceding paragraph by the Financial Institution prescribed in said paragraph is appropriate, he/she shall, following deliberation by the Council, rescind the Confirmation pertaining to said Financial Institution.
(3) The provisions of Article 102, paragraph (2), (6) and (8) apply mutatis mutandis to the rescission of Confirmation under the preceding paragraph.
(4) In the event that a Financial Institution subject to Confirmation pertaining to the Measures Under Item (i) and Bank Holding Company, etc. which has said Financial Institution as its subsidiary company have not made an application prescribed in paragraph (1) or (2) of the following Article within the period prescribed in Article 102, paragraph (5), if said Financial Institution does not submit the plan prescribed in paragraph (1) within said period, the Prime Minister shall rescind said Confirmation.
(5) When the Prime Minister finds that the plan submitted by a Financial Institution under paragraph (1) is not appropriate, he/she shall rescind said Confirmation.
(6) If the Prime Minister intends to rescind the Confirmation pertaining to the Measures Under Item (i) under the provisions of the preceding two paragraphs, he/she shall hear the opinion of the Minister of Finance in advance.
(7) The provisions of Article 102, paragraphs (2), (6) and (8) apply mutatis mutandis to the rescission of the Confirmation pertaining to the Measures Under Item (i) under paragraph (4) or (5).
(8) In the event that Confirmation pertaining to the Measures Under Item (i) has been rescinded under paragraph (4) or (5), when a situation is likely to arise in which the Financial Institution subject to said rescission is unable to satisfy its obligations in full with its assets, the Prime Minister may, notwithstanding the provisions of Article 102, paragraph (1), give the Confirmation pertaining to the Measures Under Item (ii) with respect to said Financial Institution, following deliberation by the Council.
(9) The provisions of Article 102, paragraphs (2), (3), and (6) through (8) apply mutatis mutandis to the Confirmation pertaining to the Measures Under Item (ii) prescribed in the preceding paragraph. In this case, the term "Financial Institution subject to said Confirmation or Bank Holding Company, etc. which has said Financial Institution as its subsidiary company" in Article 102, paragraph (6) shall be deemed to be replaced with "Financial Institution subject to said Confirmation," and any other necessary technical replacement of terms shall be specified by Cabinet Order.
(Decision for Subscription for Shares, etc.)
Article 105 (1) In the event that Confirmation pertaining to the Measures Under Item (i) has been given, when the Corporation has received an application pertaining to the Measures Under Item (i) (limited to the Subscription for Shares, etc. for said Financial Institution; hereinafter the same shall apply in this paragraph) from the Financial Institution subject to said Confirmation within the period prescribed in Article 102, paragraph (5), the Corporation shall request a decision from the Prime Minister (in the event that the Financial Institution is a labor bank or federation of labor banks, from the Prime Minister and the Minister of Health, Labour and Welfare, and in the event that such Financial Institution is The Shoko Chukin Bank, Ltd., from the Prime Minister, the Minister of Finance, and Minister of Economy, Trade and Industry; the same shall apply in paragraphs (3) to (6), Article 108, and Article 110, paragraph (1)) in joint names with said Financial Institution as to whether or not to implement the Measures Under Item (i) pertaining to said application.
(2) In the event that Confirmation pertaining to the Measures Under Item (i) has been given, when the Corporation has received an application pertaining to the Measures Under Item (i) from the Bank Holding Company, etc. which has as its subsidiary company the Financial Institution subject to said Confirmation (limited to the subscription for shares issued by said Bank Holding Company, etc.; hereinafter the same shall apply in this paragraph) within the period prescribed in Article 102, paragraph (5), the Corporation shall request a decision from the Prime Minister in joint names with said Bank Holding Company, etc. as to whether or not to implement the Measures Under Item (i) pertaining to said application.
(3) A Financial Institution that has made an application prescribed in paragraph (1) or a Financial Institution subject to the Confirmation pertaining to the Measures Under Item (i) that is a subsidiary company of the Bank Holding Company, etc. and has made an application prescribed in the preceding paragraph (hereinafter referred to as "Subject Subsidiary Company" in this Chapter) shall submit to the Prime Minister a Management Soundness Improvement Plan (meaning a plan to improve the soundness of business management; hereinafter the same shall apply in this Chapter) setting forth measures to streamline the management and to establish a responsible management system (including, in the event that the Bank Holding Company, etc. has made an application prescribed in said paragraph, the management system of said Bank Holding Company, etc.) and other measures specified by Cabinet Order. In this case, the Subject Subsidiary Company of the Bank Holding Company, etc. that is to make an application prescribed in said paragraph shall submit said plan in joint names with said Bank Holding Company, etc.
(4) The Prime Minister shall decide to take the Measures Under Item (i) pertaining to an application prescribed in paragraph (1) or (2) only if all of the following requirements are satisfied:
(i) there are no serious difficulties associated with the disposition of the Shares, etc. (including the following) or loan claims acquired by the Corporation in connection with the Measures Under Item (i):
(a) in the event that the Shares, etc. are shares, the shares specified below:
1. in the event that said shares are those for which a request for Conversion into Shares of Another Class (meaning the delivery of shares of another class in exchange for the acquisition of said shares by their issuing company; hereinafter the same shall apply in this Chapter) can be made, shares of another class into which said shares are converted pursuant to the request;
2. in the event that said shares are convertible upon the occurrence of certain events, shares of another class into which said shares are converted as a result of such occurrence; and
3. shares split or consolidated with respect to said shares or the shares of another class specified in 1 or 2;
(b) in the event that said Shares, etc. are subordinated bonds, shares delivered through the exercise of share options attached to said subordinated bonds and shares split or consolidated with respect thereto; and
(c) in the event that said Shares, etc. are preferred equity investments, preferred equity investments split with respect to said preferred equity investments;
(ii) when a Bank Holding Company, etc. has made an application prescribed in paragraph (2), the Bank Holding Company, etc. is not unable to satisfy its obligations in full with its assets; and
(iii) the Financial Institution is expected to implement the following measures through the reliable execution of the management soundness improvement plan, etc.:
(a) measures to ensure the rational management of business;
(b) measures to clarify management responsibilities; and
(c) measures to clarify shareholder responsibilities.
(5) The Prime Minister shall obtain consent from the Minister of Finance when making a decision under the preceding paragraph; provided, however, that this shall not apply if said decision relates to The Shoko Chukin Bank, Ltd.
(6) Upon making a decision under paragraph (1) or (2), the Prime Minister shall report such fact to the Financial Institution that has made the application prescribed in paragraph (1) or the Bank Holding Company, etc. that has made the application prescribed in paragraph (2) and the Corporation.
(7) When a decision is made not to implement the Measures Under Item (i) pertaining to an application prescribed in paragraph (1) or (2), the Prime Minister shall immediately rescind the Confirmation pertaining to the Measures Under Item (i) with respect to the Financial Institution that has made the application prescribed in paragraph (1) or the Subject Subsidiary Company of the Bank Holding Company, etc. that has made the application prescribed in paragraph (2).
(8) The provisions of Article 102, paragraphs (2), (6) and (8), and paragraphs (6) and (8) of the preceding Article apply mutatis mutandis to the rescission of Confirmation under the preceding paragraph pertaining to the Measures Under Item (i) and the provisions of paragraph (9) of the preceding Article apply mutatis mutandis to Confirmation pertaining to the Measures Under Item (ii) under paragraph (8) of the preceding Article as applied mutatis mutandis pursuant to the provisions of this paragraph.
(Special Provisions for Reduction in Amount of Stated Capital)
Article 106 (1) In the event that an application prescribed in paragraph (1) or (2) of the preceding Article has been made (in the event that an application prescribed in paragraph (1) of the preceding Article has been made, limited to applications pertaining to subscription for shares), the Prime Minister may, when he/she finds it necessary in making a decision under paragraph (4) of the preceding Article pertaining to said application, require that said subscription for shares be conditioned upon a reduction in the amount of stated capital of a Bank, etc., Bank Holding Company, etc., the Subject Subsidiary Company of said Bank Holding Company, etc., or The Shoko Chukin Bank, Ltd. that is subject to said decision.
(2) The provisions of Article 89 apply mutatis mutandis to a reduction in the amount of stated capital in the event that a decision is made under paragraph (4) of the preceding Article whereby the subscription for shares is conditioned upon a reduction in the amount of stated capital being made pursuant to the provisions of the preceding paragraph.
(3) In the event that a decision is made under paragraph (4) of the preceding Article whereby the subscription for shares is conditioned upon a reduction in the amount of stated capital made pursuant to the provisions of paragraph (1), the Bank, etc. or Bank Holding Company, etc. or the Subject Subsidiary Company of said Bank Holding Company, etc. or The Shoko Chukin Bank, Ltd. that is subject to said decision shall, when it has obtained or failed to obtain a resolution of a shareholders meeting or class meeting with respect to said reduction in the amount of stated capital, immediately report such fact and submit the minutes of the shareholders meeting and other documents specified by Cabinet Order (including those prepared in the form of an electromagnetic record) to the Prime Minister, and shall also notify the Corporation to that effect.
(4) In the case prescribed in the preceding paragraph, if a resolution by a shareholders meeting or class meeting is not obtained for the reduction in the amount of stated capital that is prescribed as the condition under said paragraph, the Prime Minister shall rescind the Confirmation pertaining to the Measures Under Item (i) with respect to said Bank, etc., Subject Subsidiary Company, or The Shoko Chukin Bank, Ltd. and shall also rescind the decision under paragraph (4) of the preceding Article with respect to said Bank, etc., Bank Holding Company, etc., or The Shoko Chukin Bank, Ltd.
(5) The provisions of Article 102, paragraphs (6) and (8) and Article 104, paragraphs (6) and (8) apply mutatis mutandis to the rescission of Confirmation pertaining to the Measures Under Item (i) under the preceding paragraph, the provisions of Article 104, paragraph (9) (excluding the part pertaining to Article 102, paragraph (2)) apply mutatis mutandis to the Confirmation pertaining to the Measures Under Item (ii) under Article 104, paragraph (8) as applied mutatis mutandis pursuant to this paragraph, and the provisions of paragraph (6) of the preceding Article apply mutatis mutandis to the event that a decision under paragraph (4) of the preceding Article is rescinded pursuant to the provisions of the preceding paragraph.
(6) For the purpose of applying the provisions of paragraphs (1) and (3) in the event that a Financial Institution subject to a decision under paragraph (4) of the preceding Article is The Shoko Chukin Bank, Ltd., the term "the Prime Minister" in these provisions shall be deemed to be "the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry."
(Subscription for Shares, etc. by Corporation)
Article 107 (1) When a decision is made under Article 105, paragraph (4), the Corporation shall execute the Subscription for Shares, etc. in accordance with said decision.
(2) The Corporation shall, when it has executed the Subscription for Shares, etc. under the preceding paragraph, promptly report the details thereof to the Prime Minister and the Minister of Finance (in the event that the issuer of the Shares, etc. is a labor bank or federation of labor banks, the Prime Minister, the Minister of Finance, and the Minister of Health, Labour and Welfare, and in the event that the issuer of the Shares, etc. is The Shoko Chukin Bank, Ltd., the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry).
(3) In the case of a Bank Holding Company, etc. has made an application prescribed in Article 105, paragraph (2), if the Corporation has executed the subscription for shares issued by the Bank Holding Company, etc. in accordance with a decision under Article 105, paragraph (4), said Bank Holding Company, etc. shall execute the Subscription for Shares, etc. (limited to the cases where the amount of said Subscription for Shares, etc. is not less than the amount of said subscription for shares) without delay with respect to the Subject Subsidiary Company.
(Special Provisions for Restrictions on Increase in Total Number of Shares Issued by Company)
Article 107-2 (1) In the event that an application prescribed in Article 105, paragraph (1) or (2) is for subscription for shares or subordinated bonds (limited to those with share options; hereinafter the same shall apply in this Article), when the Prime Minister (in the event that the issuer of shares or subordinated bonds is The Shoko Chukin Bank, Ltd., the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry) has made a decision under Article 105, paragraph (4) pertaining to said application, if the total number of issued shares of the Financial Institution or Bank Holding Company, etc. that has made said application, the number of shares to be increased as a result of conversion pursuant to a request for conversion pertaining to said issued shares or conversion upon the occurrence of certain events, and the number of shares to be increased as a result of the delivery of shares following the exercise of share options which have already been issued, coupled with the number of shares pertaining to said subscription, the number of shares to be increased as a result of the issuance of shares pursuant to a request for conversion pertaining to said subscription, and the number of shares to be increased as a result of the issuance of shares following the exercise of share options attached to subordinated bonds pertaining to said subscription (hereinafter referred to as the "Total Number of Shares after Subscription" in this paragraph) exceeds the number four times the total number of issued shares, said Financial Institution or Bank Holding Company, etc. may, notwithstanding the provisions of Article 113, paragraph (3) of the Companies Act, increase the total number of shares issued by said Financial Institution or Bank Holding Company, etc. to the number equal to four times the Total Number of Shares after Subscription, on condition that the subscription for shares or subordinated bonds is executed in accordance with the decision under Article 105, paragraph (4).
(2) In the event that a Financial Institution or Bank Holding Company, etc. increases the total number of shares to be issued based on the provisions of the preceding paragraph, for the purpose of applying the provisions of Article 46, paragraph (2) of the Commercial Registration Act (Act No. 125 of 1963) concerning a written application for a registration of change due to said increase, the term "the minutes" in Article 46, paragraph (2) of said Act shall be deemed to be "the minutes and documents evidencing the subscription for shares or subordinated bonds in accordance with a decision under Article 105, paragraph (4) of the Deposit Insurance Act (Act No. 34 of 1971)."
(Special Provisions for Issuance of Shares with Restricted Voting Rights)
Article 107-3 (1) For the purpose of applying the provisions of Article 115 of the Companies Act, it shall be deemed that no shares with restricted voting rights (meaning the shares with restricted voting rights prescribed in Article 115 of said Act; hereinafter the same shall apply in this Article) have been issued in accordance with a decision under Article 105, paragraph (4) by a Financial Institution or Bank Holding Company, etc. that has said Financial Institution as its Subject Subsidiary Company and is subject to the Confirmation pertaining to the Measures Under Item (i).
(2) In the event that shares with restricted voting rights are issued in accordance with a decision under Article 105, paragraph (4) by a Financial Institution or Bank Holding Company, etc. referred to in the preceding paragraph, registration to that effect shall be made in registering a change resulting from the issuance of said shares with restricted voting right.
(3) For the purpose of applying the provisions of Article 56 of the Commercial Registration Act in the case referred to in the preceding paragraph, the term "the following documents" in said Article shall be deemed to be "the following documents and documents evidencing the fact that the issuance of shares with restricted voting right is in accordance with a decision under Article 105, paragraph (4) of the Deposit Insurance Act (Act No. 34 of 1971)."
(Special Provisions for Issuance of Preferred Equity Investments)
Article 107-4 (1) For the purpose of applying the provisions of Article 4, paragraph (2) of the Preferred Equity Investment Act, it shall be deemed that no preferred equity investments have been issued in accordance with a decision under Article 105, paragraph (4) by a Financial Institution that is subject to the Confirmation pertaining to the Measures Under Item (i).
(2) In the event that preferred equity investments have been issued in accordance with a decision under Article 105, paragraph (4) by a Financial Institution referred to in the preceding paragraph, registration to that effect shall be made pursuant to the provisions of Cabinet Order in registering a change resulting from the issuance of said preferred equity investments.
(Publication of Plan, etc.)
Article 108 (1) The Prime Minister shall, upon making a decision under Article 105, paragraph (4), make public the Management Soundness Improvement Plan submitted under Article 105, paragraph (3); provided, however, that this shall not apply to matters for which disclosure is likely to harm an orderly financial system, divulge any secret of Depositors, etc. or business customers of a Financial Institution that has submitted the Management Soundness Improvement Plan (including a Bank Holding Company, etc. and its subsidiary company, etc. (meaning a subsidiary company, etc. that is a Bank, etc. prescribed in Article 52-25 of the Banking Act (including the cases where it is applied mutatis mutandis pursuant to Article 17 of the Long-Term Credit Bank Act)) that have submitted said Management Soundness Improvement Plan in joint names; hereinafter the same shall apply in this paragraph), or bring undue disadvantage to the conduct of business by said Financial Institution.
(2) Until such time when the Corporation makes a disposition or receives a redemption or repayment with respect to the whole of Acquired Shares, etc. or Acquired Loan Claims (meaning loan claims acquired by the Corporation pursuant to the Measures Under Item (i); hereinafter the same shall apply in this Chapter), the Prime Minister may request a Financial Institution subject to Confirmation pertaining to said Measures Under Item (i) (including the Bank Holding Company, etc. that has submitted a Management Soundness Improvement Plan under Article 105, paragraph (3) in joint names with said Financial Institution) to report the status of implementation of the Management Soundness Improvement Plan submitted under Article 105, paragraph (3) and make such report public.
(3) The term "Acquired Shares, etc." as used in the preceding paragraph means the following:
(i) the Shares, etc. (including the following) acquired by the Corporation pursuant to the Measures Under Item (i) and other Shares, etc. specified by Cabinet Order:
(a) in the event that the Shares, etc. are shares the shares specified below:
1. in the event that said shares are those for which a request for Conversion into Shares of Another Class can be made, shares of the other class into which said shares are converted pursuant to the request;
2. in the event that said shares are convertible upon the occurrence of certain events, shares of the other class into which said shares are converted as a result of such occurrence; and
3. shares split or consolidated with respect to said shares or the shares of another class specified in 1 or 2;
(b) in the event that said Shares, etc. are subordinated bonds, shares delivered through the exercise of share options attached to said subordinated bonds and shares split or consolidated with respect thereto; and
(c) in the event that said Shares, etc. are preferred equity investments, preferred equity investments split with respect to said preferred equity investments; and
(ii) the shares (including the following) allotted to the Corporation by a company that has become a wholly owning parent stock company in a share exchange or wholly owning parent company incorporated through a share transfer of a Financial Institution or Bank Holding Company, etc. with respect to whom the Corporation has executed the Subscription for Shares, etc. pursuant to the Measures Under Item (i) and other Shares, etc. specified by Cabinet Order:
(a) in the event that said shares are those for which a request for Conversion into Shares of Another Class can be made, shares of the other class into which said shares are converted pursuant to the request;
(b) in the event that said shares are convertible upon the occurrence of certain events, shares of another class into which said shares are converted as a result of such occurrence; and
(c) the shares split or consolidated with respect to said shares or the shares of another class specified in (a) or (b).
(Authorization for Share Exchange, etc. Pertaining to Measures Under Item (i))
Article 108-2 (1) A Financial Institution or Bank Holding Company, etc. (including a company prescribed in item (i) of the following paragraph in the event that the authorization set forth in this paragraph is given) with respect to which the Corporation has executed the Subscription for Shares, etc. in accordance with a decision under Article 105, paragraph (4), which has issued Acquired Shares, etc. (meaning Acquired Shares, etc. prescribed in paragraph (3) of the preceding Article; hereinafter the same shall apply in this Chapter) actually held by the Corporation (hereinafter referred to as "Issuing Financial Institution, etc." in this Article and the following Article) shall obtain authorization from the Prime Minister in advance if said Financial Institution or Bank Holding Company, etc. intends to effect a share exchange (limited to those through which the Issuing Financial Institution, etc. becomes a wholly owned subsidiary company in share exchange) or share transfer (hereinafter referred to as "Share Exchange, etc." in this Article).
(2) The Prime Minister shall give the authorization set forth in the preceding paragraph only if all of the following requirements are satisfied:
(i) a company that is to become, through the Share Exchange, etc., a wholly owning parent stock company in share exchange or wholly owning parent company incorporated through share transfer of the Issuing Financial Institution, etc. is a Bank Holding Company, etc. (including those that will be newly established);
(ii) the type of Acquired Shares, etc. to be allotted to the Corporation through the Share Exchange, etc. is found to be the same as the type of Acquired Shares, etc. actually held by the Corporation prior to said Share Exchange, etc., and the ratio of voting rights pertaining to Acquired Shares, etc. actually held by the Corporation after said Share Exchange, etc. to voting rights of all shareholders of the company prescribed in the preceding item is not significantly lower than the ratio of voting rights pertaining to Acquired Shares, etc. held by the Corporation prior to said Share Exchange, etc. to voting rights of all shareholders of said Issuing Financial Institution, etc.; and
(iii) there will be no difficulty in making a disposition of the Acquired Shares, etc. following the Share Exchange, etc.
(3) When the Issuing Financial Institution, etc. has executed a Share Exchange, etc. following the authorization set forth in paragraph (1), said Issuing Financial Institution, etc., a Financial Institution that is a subsidiary company of said Issuing Financial Institution, etc. with respect to which the Corporation has executed the Subscription for Shares, etc. in accordance with a decision under Article 105, paragraph (4), or the Subject Subsidiary Company (including the bridge subsidiary company prescribed in paragraph (4) of the following Article) of the Bank Holding Company, etc. with respect to which the Corporation has executed the subscription for shares in accordance with a decision under Article 105, paragraph (4) shall submit to the Prime Minister, in joint names with a company that has become, through said Share Exchange, etc., a wholly owning parent stock company in a share exchange or wholly owning parent company incorporated through a share transfer of said Issuing Financial Institution, etc., a new Management Soundness Improvement Plan to replace the Management Soundness Improvement Plan that has been implemented (meaning the plan submitted under Article 105, paragraph (3), this paragraph, or paragraph (3) of the following Article as applied mutatis mutandis pursuant to the provisions of paragraph (4) of the following Article), stating, in addition to the measures stated in said Management Soundness Improvement Plan (excluding the part pertaining to the management system of the Bank Holding Company, etc. in joint names with whom said Management Soundness Improvement Plan was submitted), measures to establish a responsible management system in a company that has become, through the Share Exchange, etc., a wholly owning parent stock company in a share exchange or wholly owning parent company incorporated through a share transfer of said Issuing Financial Institution, etc., and other measures specified by Cabinet Order.
(4) The provisions of the preceding Article apply mutatis mutandis to the Management Soundness Improvement Plan submitted to the Prime Minister under the preceding paragraph. In this case, the term "Financial Institution ... (... that has submitted a Management Soundness Improvement Plan under Article 105, paragraph (3)" in paragraph (2) of the preceding Article shall be deemed to be replaced with "Financial Institution ... that has submitted a Management Soundness Improvement Plan under Article 108-2, paragraph (3) (... that has submitted said Management Soundness Improvement Plan."
(Authorization for Corporate Reorganization Pertaining to Measures Under Item (i))
Article 108-3 (1) A Financial Institution (including a Bridge Financial Institution prescribed in item (i) of the following paragraph in the event that the authorization set forth in this paragraph is given) with respect to which the Corporation has executed the Subscription for Shares, etc. in accordance with a decision under Article 105, paragraph (4), which is an issuer of Acquired Shares, etc. or obligor of Acquired Loan Claims actually held by the Corporation (hereinafter referred to as "Subject Financial Institution" in this Article) shall, if it intends to undertake the succession to business through a merger, company split, or Business Transfer, etc. (hereinafter referred to as "Corporate Reorganization" in this Article), obtain authorization from the Prime Minister (in the event that the Subject Financial Institution is a labor bank or federation of labor banks, the Prime Minister and the Minister of Health, Labour and Welfare, in the event that such Financial Institution is The Shoko Chukin Bank, Ltd., the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry; the same shall apply in the following paragraph) in advance.
(2) The Prime Minister shall give the authorization set forth in the preceding paragraph only if all of the following requirements are satisfied:
(i) a corporation who is to become an issuer of Acquired Shares, etc. or obligor of Acquired Loan Claims held by the Corporation after the Corporate Reorganization is the Subject Financial Institution or is another Financial Institution (including those that will be newly established; hereinafter referred to as the "Bridge Financial Institution" in this Article) that succeeds to the whole of the business pertaining to said Management Soundness Improvement Plan (meaning the plan submitted under Article 105, paragraph (3) or the following paragraph) that has been implemented by said Subject Financial Institution (hereinafter referred to as "Management Soundness Improvement Operations" in this paragraph);
(ii) the management soundness improvement of the Subject Financial Institution (including the Bridge Financial Institution) is not hindered as a result of the Corporate Reorganization;
(iii) it can be expected with certainty that, when the Management Soundness Improvement Operations are to be succeeded to, such succession will be conducted smoothly and appropriately;
(iv) there will be no difficulty in making a disposition or receiving a redemption or repayment with respect to said Acquired Shares, etc. or Acquired Loan Claims following the Corporate Reorganization; and
(v) other requirements specified by Cabinet Order.
(3) In the event that the Subject Financial Institution has conducted the Corporate Reorganization following the authorization set forth in paragraph (1), when there is any Bridge Financial Institution pertaining to said Corporate Reorganization, said Bridge Financial Institution shall submit a Management Soundness Improvement Plan, setting forth measures to achieve the rationalization of management, measures to establish a responsible management system, and other measures specified by Cabinet Order, to the Prime Minister (in the event that said Bridge Financial Institution is a labor bank or federation of labor banks, the Prime Minister and the Minister of Health, Labour and Welfare, and in the event that such Financial Institution is The Shoko Chukin Bank, Ltd., the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry; the same shall apply in paragraph (8)).
(4) The provisions of the preceding three paragraphs apply mutatis mutandis to the Subject Subsidiary Company of the Bank Holding Company, etc. with respect to which the Corporation has executed the subscription for shares in accordance with a decision under Article 105, paragraph (4) or the Financial Institution (including the Bridge Financial Institution) with respect to which the Corporation has executed the Subscription for Shares, etc. in accordance with a decision under Article 105, paragraph (4) that has ceased to be a Subject Financial Institution as a result of said share exchange or share transfer effected by said Financial Institution (including a bridge subsidiary company (meaning another Financial Institution prescribed in paragraph (2), item (i) as applied mutatis mutandis pursuant to this paragraph; hereinafter the same shall apply in this Article); hereinafter referred to as "Subject Subsidiary Company, etc." in this Article) that has been implementing a Management Soundness Improvement Plan (meaning a plan submitted under Article 105, paragraph (3), paragraph (3) of the preceding Article (including the cases where it is applied mutatis mutandis pursuant to paragraph (8)), the preceding paragraph as applied mutatis mutandis pursuant to this paragraph, or paragraph (7)). In this case, the term "if it intends to undertake the succession to business through a merger, company split" in paragraph (1) shall be deemed to be replaced with "until such time that the Corporation has made a disposition or received a redemption or repayment with respect to all of the Acquired Shares, etc. or Acquired Loan Claims pertaining to the Financial Institution or Bank Holding Company, etc. that has executed the Subscription for Shares, etc. in accordance with a decision under Article 105, paragraph (4) pertaining to the relevant Management Soundness Improvement Plan, if it intends to undertake the succession to business through a merger, company split," the terms "A corporation who is to become an issuer of Acquired Shares, etc. or obligor of Acquired Loan Claims held by the Corporation after the Corporate Reorganization is the Subject Financial Institution or", "business pertaining to said Management Soundness Improvement Plan (meaning the plan submitted under Article 105, paragraph (3) or the following paragraph) that has been implemented by said Subject Financial Institution" and "including the Bridge Financial Institution" in paragraph (2) shall be deemed to be replaced with "A Bank Holding Company, etc. that has submitted said Management Soundness Improvement Plan in joint names with said Subject Subsidiary Company, etc.", "Subject Subsidiary Company, etc. or the business pertaining to said Management Soundness Improvement Plan after the Corporate Reorganization", and "including a bridge subsidiary company," respectively, and the terms "Bridge Financial Institution" and "setting forth measures to achieve the rationalization of management" in the preceding paragraph are to be deemed to be replaced with "bridge subsidiary company" and "in joint names with the Bank Holding Company, etc. prescribed in paragraph (2), item (i), setting forth measures to achieve the rationalization of management" respectively.
(5) The Issuing Financial Institution, etc. other than the Subject Financial Institution (including another Bank Holding Company, etc. prescribed in item (i) of the following paragraph in the event that the authorization set forth in this paragraph is granted, or company prescribed in paragraph (2), item (i) of the preceding Article as applied mutatis mutandis pursuant to paragraph (8) in the event that the authorization set forth in paragraph (1) of the preceding Article as applied mutatis mutandis pursuant to paragraph (8) is granted which is an issuer of Acquired Shares, etc. actually held by the Corporation (hereinafter referred to as "Issuing Bank Holding Company, etc. after Corporate Reorganization" in this Article); the same shall apply in the following paragraph) shall, if it intends to conduct Corporate Reorganization, obtain authorization from the Prime Minister in advance.
(6) The Prime Minister shall give the authorization set forth in the preceding paragraph only if all of the following requirements are satisfied:
(i) a company that is to become an issuer of Acquired Shares, etc. held by the Corporation after the Corporate Reorganization is the Issuing Financial Institution, etc. or another Bank Holding Company, etc. (including those that will be newly established) having as its subsidiary the Subject Subsidiary Company, etc. pertaining to said Issuing Financial Institution, etc.;
(ii) the business management by the Issuing Financial Institution, etc. (including another Bank Holding Company, etc. prescribed in the preceding item) of the Subject Financial Institution, etc. pertaining to said Issuing Financial Institution, etc. is not hindered as a result of the Corporate Reorganization;
(iii) there will be no difficulty in making a disposition of the Acquired Shares, etc. following the Corporate Reorganization; and
(iv) other requirements specified by Cabinet Order.
(7) In the event that the Issuing Financial Institution, etc. other than the Subject Financial Institution or the Issuing Bank Holding Company, etc. after Corporate Reorganization has conducted Corporate Reorganization following the authorization set forth in paragraph (5), if there is another Bank Holding Company, etc. prescribed in item (i) of the preceding paragraph, said Issuing Financial Institution, etc. or the Subject Subsidiary Company, etc. pertaining to the Issuing Bank Holding Company, etc. after Corporate Reorganization shall submit to the Prime Minister, in joint names with said another Bank Holding Company, etc., a new Management Soundness Improvement Plan to replace the Management Soundness Improvement Plan that has been implemented (meaning the Management Soundness Improvement Plan prescribed in paragraph (4)), stating, in addition to the measures stated in said Management Soundness Improvement Plan (excluding the part pertaining to the management system of the Bank Holding Company, etc. in joint names with whom said Management Soundness Improvement Plan was submitted), measures to establish a responsible management system in said another Bank Holding Company, etc., and other measures specified by Cabinet Order.
(8) The provisions of Article 108, paragraph (1) apply mutatis mutandis to the Management Soundness Improvement Plans submitted to the Prime Minister under paragraph (3) (including the cases where it is applied mutatis mutandis pursuant to paragraph (4)) or the preceding paragraph, the provisions of Article 108, paragraph (2) apply mutatis mutandis to the Financial Institution (including the Bank Holding Company, etc. in joint names with whom these Management Soundness Improvement Plans have been submitted) that has submitted these Management Soundness Improvement Plans, and the provisions of Article 108-2 apply mutatis mutandis to a Bridge Financial Institution that is an issuer of Acquired Shares, etc. actually held by the Corporation or the Issuing Bank Holding Company, etc. after Corporate Reorganization. In this case, the terms "a Financial Institution that is a subsidiary company of said Issuing Financial Institution, etc. with respect to which the Corporation has executed the Subscription for Shares, etc. in accordance with a decision under Article 105, paragraph (4), or the Subject Subsidiary Company (including the bridge subsidiary company prescribed in paragraph (4) of the following Article)" and "the plan submitted under Article 105, paragraph (3), this paragraph, or paragraph (3) of the following Article as applied mutatis mutandis pursuant to the provisions of paragraph (4) of the following Article" in Article 108-2, paragraph (3) shall be deemed to be replaced with "the Subject Subsidiary Company, etc.," and "the plan submitted under Article 108-3, paragraph (3) (including the cases where it is applied mutatis mutandis pursuant to Article 108-3, paragraph (4)), Article 108-3, paragraph (7), or Article 108-2, paragraph (3) as applied mutatis mutandis pursuant to Article 108-3, paragraph (8)" respectively.
(Disposition of Acquired Shares, etc. or Acquired Loan Claims)
Article 109 (1) The Corporation shall, if it intends to transfer or make any other disposition of Acquired Shares, etc. or Acquired Loan Claims, obtain approval from the Prime Minister and the Minister of Finance (in the event that an issuer of said Acquired Shares, etc. or obligor of Acquired Loan Claims is a labor bank or federation of labor banks, from the Prime Minister, the Minister of Finance, and the Minister of Health, Labour and Welfare, and in the event that an issuer of said Acquired Shares, etc. or obligor of Acquired Loan Claims is The Shoko Chukin Bank, Ltd., from the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry; the same shall apply in the following paragraph).
(2) Upon making a disposition prescribed in the preceding paragraph, the Corporation shall promptly report the details thereof to the Prime Minister and the Minister of Finance.
(Special Provisions for Injunction Ordering Management and Financial Assistance)
Article 110 (1) When Confirmation pertaining to the Measures Under Item (ii) is given under Article 102, paragraph (1) or Article 104, paragraph (8) (including the cases where it is applied mutatis mutandis pursuant to Article 105, paragraph (8) and Article 106, paragraph (5)), the Prime Minister shall, notwithstanding the provisions of Article 74, paragraph (1) and (2), immediately issue a Injunction Ordering Management with respect to the Financial Institution subject to said Confirmation.
(2) For the purpose of applying this Act in the event that a Injunction Ordering Management is issued under the preceding paragraph, the Financial Institution (excluding the Failed Financial Institution) subject to said Injunction Ordering Management shall be deemed to be the Failed Financial Institution.
(3) The provisions of Article 64, paragraph (2) shall not apply to cases where a resolution by the Policy Board prescribed in Article 64, paragraph (1) is to be deliberated with respect to the Financial Assistance for a merger, etc. in which a Financial Institution that is subject to a Injunction Ordering Management under paragraph (1) is deemed to be the Failed Financial Institution. In this case, the Policy Board may, when it finds, in light of the financial conditions of said Financial Institution, that the Financial Assistance does not exceed the scope necessary to carry out said merger, etc., adopt a resolution to provide Financial Assistance.
(Decision on Acquisition of Shares of a Bank Under Special Crisis Management)
Article 111 (1) The Prime Minister shall, at the time of granting the Confirmation pertaining to the Measures Under Item (iii), decide that the Corporation will acquire shares of the Bank, etc. subject to the Confirmation (referred to as "Decision on Commencement of Special Crisis Management" in the following paragraph).
(2) Upon making the Decision on Commencement of Special Crisis Management, the Prime Minister shall notify the Corporation and the Bank, etc. subject to said Decision on Commencement of Special Crisis Management (hereinafter referred to as "Bank Under Special Crisis Management") to that effect and give public notice thereof in the official gazette.
(Acquisition of Shares, etc.)
Article 112 (1) When public notice is given under paragraph (2) of the preceding Article, the shares of the Bank Under Special Crisis Management shall be acquired by the Corporation at the time of said public notice (hereinafter referred to as "Time of Public Notice" in this Chapter).
(2) Share certificates for the shares acquired by the Corporation under the preceding paragraph shall become invalid at the Time of Public Notice.
(3) The provisions of the main clause of Article 128, paragraph (1) and Article 130, paragraph (1) of the Companies Act shall not apply to the acquisition of shares under paragraph (1).
(4) Any pledge and other security interest in the shares acquired by the Corporation under paragraph (1) shall be extinguished at the Time of Public Notice.
(5) When the articles of incorporation of the Bank Under Special Crisis Management has provisions prescribed in Article 108, paragraph (2) of the Companies Act (limited to the part pertaining to item (ix)), said provisions shall be deemed to be abolished at the Time of Public Notice.
(Publication of Finances of Bank Under Special Crisis Management)
Article 113 Upon giving public notice under Article 111, paragraph (2), the Prime Minister shall make public the conditions of assets and liabilities of the Bank Under Special Crisis Management as of the Time of Public Notice pursuant to the provisions of Cabinet Office Ordinance and Ordinance of the Ministry of Finance.
(Special Provisions for Appointment and Dismissal of Officers of Bank Under Special Crisis Management, etc.)
Article 114 (1) Notwithstanding the provisions of Article 329, paragraph (1) and Article 402, paragraph (2) of the Companies Act, the Corporation may, based on the designation of the Prime Minister, appoint a director, executive officer, accounting advisor, corporate auditor and accounting auditor of the Bank Under Special Crisis Management. In this case, documents evidencing such designation and appointment shall be attached to a written application for a registration of change of director, executive officer, accounting advisor, corporate auditor or accounting auditor of the Bank Under Special Crisis Management.
(2) Notwithstanding the provisions of Article 339, paragraph (1) and Article 403, paragraph (1) of the Companies Act, the Corporation may, with approval from the Prime Minister, dismiss a director, executive officer, accounting advisor, corporate auditor or accounting auditor of the Bank Under Special Crisis Management.
(3) When an appointment under paragraph (1) or dismissal under the preceding paragraph is made, it shall be deemed that there has been a resolution by shareholders meeting prescribed in Article 329, paragraph (1) or Article 339, paragraph (1) of the Companies Act or resolution by the board of directors prescribed in Article 402, paragraph (2) or Article 403, paragraph (1) of said Act.
(Submission of Reports or Materials, etc.)
Article 115 The Prime Minister may, when he/she finds it necessary, request the Bank Under Special Crisis Management and a Financial Institution Agent having said Bank Under Special Crisis Management as its Principal Financial Institution to submit reports or materials concerning the status of business and property, etc. or order the preparation and submission of a management plan and other necessary measures.
(Measures for Ascertaining Liability of Management, etc. for Failure of a Bank Under Special Crisis Management)
Article 116 (1) The Bank Under Special Crisis Management shall, in order to have its director, executive officer, accounting advisor, corporate auditor or accounting auditor or a person who previously held any of these positions perform civil liability based on a breach of obligations in the course of duties, file an action or take other necessary measures.
(2) A director, executive officer, accounting advisor, corporate auditor and accounting auditor of the Bank Under Special Crisis Management shall, when by carrying out his/her duty he/she considers that an offense has been committed, he/she shall take necessary measures toward filing an accusation.
(Special Provisions for Procedures for Protection of Creditors)
Article 117 The provisions of Article 89 apply mutatis mutandis to cases where the Bank Under Special Crisis Management has adopted a resolution for reduction in the amount of stated capital.
(Special Provisions for Financial Assistance Pertaining to a Bank Under Special Crisis Management)
Article 118 (1) An Assuming Financial Institution or Assuming Bank Holding Company, etc. undertaking a merger, etc. (limited to those specified in Article 59, paragraph (2), items (i), (ii) and (iv); the same shall apply in paragraph (5)) in which the Bank Under Special Crisis Management is the Failed Financial Institution may, notwithstanding the provisions of Article 59, paragraph (1), apply for the Corporation, in joint names with said Bank Under Special Crisis Management, to provide Financial Assistance (limited to those specified in Article 59, paragraph (1), item (i); the same shall apply in paragraphs (3) to (5)) to said Bank Under Special Crisis Management.
(2) The provisions of Article 59, paragraphs (6) and (7) and Article 61, paragraph (1) apply mutatis mutandis to an application under the preceding paragraph and the provisions of Article 61, paragraphs (2), (3) and (6) to (8) apply mutatis mutandis to the Confirmation prescribed in Article 61, paragraph (1) as applied mutatis mutandis pursuant to this paragraph. In this case, the term "Failed Financial Institution" in Article 61, paragraphs (1) to (3) and (8) shall be deemed to be replaced with "Bank Under Special Crisis Management," and any other necessary technical replacement of terms shall be specified by Cabinet Order.
(3) Even in cases where no application is made under Article 61, paragraph (2) as applied mutatis mutandis pursuant to the preceding paragraph, the Prime Minister may, when he/she finds that the Bank Under Special Crisis Management satisfies the requirements specified in Article 61, paragraph (3), item (iii) as applied mutatis mutandis pursuant to the preceding paragraph, provide mediation in writing with regard to a merger, etc. (limited to those specified in Article 59, paragraph (2), items (i) and (iv) and those that contribute to the protection of the Depositors, etc. and other creditors and for which the Financial Assistance by the Corporation is indispensable) between said Bank Under Special Crisis Management and another Financial Institution or said Bank Under Special Crisis Management and Bank Holding Company, etc.
(4) The provisions of Article 62, paragraphs (2) and (4) to (6) apply mutatis mutandis to the mediation prescribed in the preceding paragraph, the provisions of Article 64 (excluding paragraphs (2) and (5)) apply mutatis mutandis to the application prescribed in paragraph (1), the provisions of Article 65 and Article 66 apply mutatis mutandis to the Financial Institution or Bank Holding Company, etc. that has received the Confirmation prescribed in Article 61, paragraph (1) as applied mutatis mutandis pursuant to paragraph (2) or that has received the mediation prescribed in the preceding paragraph, and the provisions of Article 68 apply mutatis mutandis to the Financial Assistance prescribed in paragraph (1). In this case, the term "Article 59, paragraph (1) or Article 59-2, paragraph (1)" in Article 62, paragraph (2) shall be deemed to be replaced with "Article 118, paragraph (1)," the term "paragraph (1)" in Article 62, paragraphs (4) to (6) shall be deemed to be replaced with "Article 118, paragraph (3)," the term "paragraphs (4) to (7)" in Article 62, paragraph (4) shall be deemed to be replaced with "paragraphs (6) and (7)," and any other necessary technical replacement of terms shall be specified by Cabinet Order.
(5) In the event that a resolution by the Policy Board prescribed in Article 64, paragraph (1) as applied mutatis mutandis pursuant to the preceding paragraph is to be deliberated with respect to the Financial Assistance prescribed in paragraph (1), the Policy Board may, when it finds that, in light of the financial conditions of the Bank Under Special Crisis Management, the Financial Assistance does not exceed the scope necessary to carry out said merger, etc., adopt a resolution to provide Financial Assistance.
Article 119 The provisions of Article 110, paragraph (3) apply mutatis mutandis to the Financial Assistance pertaining to an application under Article 59, paragraph (1) for a merger, etc. in which the Bank Under Special Crisis Management is the Failed Financial Institution.
(Conclusion of Measures Under Item (iii))
Article 120 (1) The Prime Minister shall conclude the Measures Under Item (iii) as promptly as possible by causing the Corporation or Bank Under Special Crisis Management to take the following measures:
(i) a merger in which a Financial Institution that merges with the Bank Under Special Crisis Management survives (limited to those in which a corporation surviving after the merger is not a subsidiary of the Corporation);
(ii) a merger in which a Financial Institution is established through the merger of the Bank Under Special Crisis Management and another Financial Institution (limited to those in which a corporation established by the merger is not a subsidiary of the Corporation);
(iii) a transfer of business of the Bank Under Special Crisis Management;
(iv) the transfer of shares of the Bank Under Special Crisis Management (limited to those through which the Bank Under Special Crisis Management ceases to be a subsidiary company of the Corporation);
(v) an absorption-type company split to which the Bank Under Special Crisis Management is a party where another Financial Institution succeeds to all or part of the rights and obligations held by the Bank Under Special Crisis Management in relation to its business through said absorption-type company split (limited to an absorption-type company split where said other company is neither a subsidiary company of the Corporation nor a Subsidiary Company of the Bank Under Special Crisis Management); and
(vi) an incorporation-type company split to which the Bank Under Special Crisis Management is a party where the Financial Institution newly established through said incorporation-type company split succeeds to all or part of the rights and obligations held by the Bank Under Special Crisis Management in relation to its business through said incorporation-type company split (limited to an incorporation-type company split where the Financial Institution newly established through the incorporation-type company split is neither a subsidiary company of the Corporation nor a Subsidiary Company of the Bank Under Special Crisis Management).
(2) The Bank Under Special Crisis Management shall, if it intends to take the measures specified in items (i) through (iii), (v), and (vi) of the preceding paragraph, report to that effect to the Prime Minister and shall also notify the Corporation thereof.
(3) Upon receiving notice under the preceding paragraph, the Corporation shall immediately report to that effect to the Minister of Finance.
(4) Upon taking the measures specified in paragraph (1), item (iv), the Corporation shall promptly report to that effect to the Prime Minister and the Minister of Finance.
(5) The "Subsidiary Company of the Bank Under Special Crisis Management" set forth in paragraph (1), items (v) and (vi) means a company of which voting rights exceeding fifty hundredths of the voting rights held by all of its shareholders are held by the Bank Under Special Crisis Management.
(Crisis Management Account)
Article 121 (1) When Financial Assistance is provided pursuant to a resolution under Article 110, paragraph (3) (including the cases where it is applied mutatis mutandis pursuant to Article 119) or Article 118, paragraph (5), the Corporation shall transfer from an account (hereinafter referred to as "Crisis Management Account") pertaining to operations specified in Article 40-2, item (ii) (hereinafter referred to as "Crisis Management Operations") to a general account the amount remaining after deducting expected costs for the payment of insurance proceeds with respect to an insurable contingency of the Financial Institution pertaining to said Financial Assistance from the expected costs of said Financial Assistance.
(2) Any transfer from the Crisis Management Account to the general account under the preceding paragraph shall be deemed to be the Crisis Management Operations.
(Payment of Contributions, etc.)
Article 122 (1) When public notice is given under paragraph (4) of the following Article (including the cases where it is applied mutatis mutandis pursuant to Article 124, paragraph (3)), a Financial Institution shall, during the period specified in said public notice, pay contributions to the Corporation to cover the costs incurred in carrying out the Crisis Management Operations (excluding those pertaining to the Financial Institution, etc. subject to Specified Confirmation prescribed in Article 126-2, paragraph (1) or the Specified Bridge Financial Institution, etc. prescribed in Article 126-34, paragraph (3), item (v)).
(2) When public notice is given under the preceding paragraph, a Financial Institution shall submit documents specified by Cabinet Office Ordinance and Ordinance of the Ministry of Finance and pay contributions to the Corporation by the last day of each business year included in the period specified in said public notice.
(3) The amount of contributions prescribed in paragraph (1) shall be calculated for each Financial Institution by dividing by twelve the total amount of its liabilities outstanding on the last day of the business year immediately preceding the business year that includes the due date for payment of said contributions (excluding those specified by Cabinet Office Ordinance and Ordinance of the Ministry of Finance), multiplying the resulting amount by the number of months in the business year that includes the due date for payment of said contributions, and multiplying the resulting amount by the contribution rate specified under paragraph (2) of the following Article.
(4) The provisions of Article 50, paragraph (2) and Article 52 apply mutatis mutandis to the contributions prescribed in paragraph (1). In this case, the term "authorization of eligibility, etc. prescribed in Article 65" in Article 50, paragraph (2), item (ii) shall be deemed to be replaced with "authorization of eligibility, etc. prescribed in Article 65 or Specified Authorization of Eligibility, etc. prescribed in Article 126-31," the term "the Failed Financial Institution pertaining to the authorization of eligibility, etc." in said item shall be deemed to be replaced with "the Failed Financial Institution pertaining to the authorization of eligibility, etc. or the Specified Failed Financial Institution, etc. prescribed in Article 126-28, paragraph (1) pertaining to the Specified Authorization of Eligibility, etc. which is any of the persons listed in the items of Article 2, paragraph (1)," the term "a Injunction Ordering Management prescribed in Article 74, paragraph (1)" in item (iii) of said paragraph shall be deemed to be replaced with "a Injunction Ordering Management prescribed in Article 74, paragraph (1) or a Injunction Ordering Specified Management prescribed in Article 126-5, paragraph (1)," and the term "the Financial Institution under Management pertaining to the Injunction Ordering Management" in said item shall be deemed to be replaced with "the Financial Institution under Management pertaining to the Injunction Ordering Management or the Financial Institution, etc. prescribed in Article 126-2, paragraph (2) pertaining to the Injunction Ordering Specified Management which is any of the persons listed in the items of Article 2, paragraph (1)," and any other necessary technical replacement of terms shall be specified by Cabinet Order.
(Decision on Contributions or Specified Contributions)
Article 123 (1) Within three months of the end of each business year, the Corporation shall report the following matters to the Prime Minister and the Minister of Finance with regard to income and expenditure in the Crisis Management Account during said business year:
(i) the amount transferred from the Crisis Management Account to the general account under Article 121, paragraph (1);
(ii) the amount of loss arising from the transfer of Acquired Shares, etc. or Acquired Loan Claims or of Acquired Specified Shares, etc. (meaning the Acquired Specified Shares, etc. prescribed in Article 126-24, paragraph (3); the same shall apply in the following item) or Acquired Specified Loan Claims (meaning the Acquired Specified Loan Claims prescribed in paragraph (2) of said Article; the same shall apply in said item) below their acquisition value or other causes;
(iii) the amount of profit arising from the transfer of Acquired Shares, etc. or Acquired Loan Claims or of Acquired Specified Shares, etc. or Acquired Specified Loan Claims above their acquisition value and other reasons;
(iv) the amount of contributions or the amount of Specified Contributions that has been received; and
(v) other matters specified by Cabinet Order.
(2) In the event that a report prescribed in the preceding paragraph is received, the Prime Minister and the Minister of Finance shall, when they find it necessary, prescribe a contribution rate and payment period for contributions to be paid by a Financial Institution under paragraph (1) of the preceding Article (hereinafter referred to as "Contributions" except in Article 126-39, paragraph (1)) or Specified Contributions to be paid by a Financial Institution, etc. under Article 126-39, paragraph (1) in each business year following the business year that includes the time of receipt of said report (hereinafter referred to as "Time of Report" in this paragraph); provided, however, that in any business year preceding the business year in which the Time of Report falls, when a contribution rate and payment period for the Contributions or Specified Contributions in each business year after the business year in which the Time of Report falls are prescribed, the contribution rate and payment period for the Contributions or Specified Contributions in each business year after the business year in which said Time of Report falls shall be prescribed by changing said contribution rate and payment period.
(3) The contribution rate and payment period shall be established by taking the following matters into consideration and in a manner that covers loss in the Crisis Management Account with the Contributions or Specified Contributions and does not subject any specific Financial Institution or Financial Institution, etc. to discriminatory treatment:
(i) matters specified in each item of paragraph (1) in the business year pertaining to said report prescribed in paragraph (1); and
(ii) the financial conditions of a Financial Institution or Financial Institution, etc.
(4) Upon prescribing a contribution rate and payment period under paragraph (2), the Prime Minister and the Minister of Finance shall give public notice thereof in the official gazette.
(5) The Prime Minister and the Minister of Finance may, when they find it necessary, request the Corporation to state its opinion or submit reports or materials in order to prescribe the contribution rate and payment period under paragraph (2).
(Change of Contribution Rate, etc.)
Article 124 (1) When it becomes evident that there will be an excess or deficiency in the Contributions or Specified Contributions due to fluctuations in interest on the borrowings of the Corporation, government subsidies prescribed in paragraph (1) of the following Article, or other causes (excluding those pertaining to the matters specified in each item of paragraph (1) of the preceding Article), the Corporation shall report to that effect to the Prime Minister and the Minister of Finance.
(2) The Prime Minister and the Minister of Finance may change a contribution rate and payment period prescribed under paragraph (2) of the preceding Article to the extent necessary to make adjustments for any excess or deficiency in the Contributions or Specified Contributions pertaining to the report prescribed in the preceding paragraph.
(3) The provisions of paragraphs (4) and (5) of the preceding Article apply mutatis mutandis to cases where the Prime Minister and the Minister of Finance change a contribution rate and payment period under the preceding paragraph.
(Government Subsidies)
Article 125 (1) The government may provide subsidies to the Corporation for part of the costs required for the Crisis Management Operations within the limit specified in a budget, only when it is found that, if the costs of such operations are to be funded solely with the Contributions or Specified Contributions, the financial conditions of a Financial Institution or Financial Institution, etc. would deteriorate significantly and it may cause an extremely serious hindrance to the maintenance of an orderly credit system in Japan or cause severe disruption in the financial market or any other financial system in Japan.
(2) In any business year in which no Contributions or Specified Contributions are paid (limited to the business year following the business year that includes the day on which a government subsidy is received under the preceding paragraph), if there is any amount calculated as profit in the Crisis Management Account resulting from the settlement of profits and losses pursuant to the provisions of Cabinet Office Ordinance and Ordinance of the Ministry of Finance, the Corporation shall pay said amount to the national treasury after deducting the amount already paid to the national treasury under this paragraph from the total amount of government subsidies already received under the preceding paragraph.
(3) Procedures for payment and other necessary matters concerning the amount prescribed in the preceding paragraph shall be specified by Cabinet Order.
(Borrowing and Corporation Bonds, etc.)
Article 126 (1) The Corporation may, when it finds it necessary for carrying out the Crisis Management Operations, borrow funds (including refinancing) from the Bank of Japan, a Financial Institution, or any other person or issue the Corporation Bonds (including issuance for the purpose of refinancing the Corporation Bonds) up to the amount specified by Cabinet Order with authorization from the Prime Minister and the Minister of Finance.
(2) The provisions of Article 42, paragraph (4) and Article 42-2 apply mutatis mutandis to cases where the Corporation borrows funds or issues the Corporation Bonds under the preceding paragraph.
(3) The Corporation Bonds to be issued under paragraph (1) shall be deemed to be the Corporation Bonds issued under Article 42, paragraph (1) for the purpose of applying the provisions of Article 42, paragraphs (5) to (9).
Chapter VII-2 Measures for Orderly Resolution of Assets and Liabilities of Financial Institutions, etc. for Ensuring Financial System Stability
(Confirmation of the Necessity of Measures for Orderly Resolution of Assets and Liabilities of Financial Institutions, etc. for Ensuring Financial System Stability)
Article 126-2 (1) When the Prime Minister finds that, if the measures specified in each of the following items are not taken with respect to the Financial Institutions, etc. specified in each respective item, it may cause severe disruption in Japan's financial market and any other financial systems, he/she may, following deliberation by the Council, confirm the necessity to take said measures (hereinafter referred to as "Specified Confirmation" in this Chapter and the following Chapter):
(i) a Financial Institution, etc. (excluding one that is unable to satisfy its obligations in full with its assets): the Special Surveillance prescribed in paragraph (1) of the following Article and the Loan of Funds, etc. prescribed in Article 126-19, paragraph (1) or the Subscription for Specified Shares, etc. under Article 107, paragraph (1) as applied mutatis mutandis pursuant to Article 126-22, paragraph (7) conducted in light of the financial conditions of the Financial Institution, etc. (hereinafter referred to as the "Specified Measures Under Item (i)"); or
(ii) a Financial Institution, etc. that is unable to satisfy its obligations in full with its assets, a Financial Institution, etc. that is likely to face a situation where it is unable to satisfy its obligations in full with its assets, a Financial Institution, etc. that has suspended payment of obligations, or a Financial Institution, etc. that is likely to suspend payment of obligations: the Special Surveillance prescribed in paragraph (1) of the following Article and the Specified Financial Assistance (hereinafter referred to as the "Specified Measures Under Item (ii)").
(2) The term "Financial Institution, etc." as used in this Chapter to Chapter IX means the following:
(i) a Financial Institution, the Foreign Bank Branch prescribed in Article 47, paragraph (2) of the Banking Act (hereinafter referred to as a "Foreign Bank Branch"), the bank holding company prescribed in Article 2, paragraph (13) of said Act (hereinafter referred to as a "Bank Holding Company"), the Long Term Credit Bank holding company prescribed in Article 16-4, paragraph (1) of the Long Term Credit Bank Act (hereinafter referred to as a "Long Term Credit Bank Holding Company"), the subsidiary, etc. prescribed in Article 24, paragraph (2) of the Banking Act of a bank (referred to as a "Subsidiary, etc. of a Bank" in paragraph (5)), the subsidiary, etc. prescribed in Article 24, paragraph (2) of the Banking Act as applied mutatis mutandis pursuant to Article 17 of the Long Term Credit Bank Act of a long term credit bank (referred to as a "Subsidiary, etc. of a Long Term Credit Bank" in paragraph (5)), the subsidiary, etc. prescribed in Article 52-31, paragraph (2) of the Banking Act of a Bank Holding Company (referred to as a "Subsidiary, etc. of a Bank Holding Company" in paragraph (5)), the subsidiary, etc. prescribed in Article 52-31, paragraph (2) of the Banking Act as applied mutatis mutandis pursuant to Article 17 of the Long Term Credit Bank of a Long Term Credit Bank Holding Company (referred to as a "Subsidiary, etc. of a Long Term Credit Bank Holding Company" in paragraph (5)), the subsidiary, etc. prescribed in Article 24, paragraph (2) of the Banking Act as applied mutatis mutandis pursuant to Article 89, paragraph (1) of the Shinkin Bank Act of a Shinkin Bank or a federation of Shinkin Banks (referred to as a "Subsidiary, etc. of a Shinkin Bank, etc." in paragraph (5)), the subsidiary, etc. prescribed in Article 24, paragraph (2) of the Banking Act as applied mutatis mutandis pursuant to Article 6, paragraph (1) of the Act on Financial Businesses by Cooperative of a credit cooperative or a federation of credit cooperatives (referred to as a "Subsidiary, etc. of a Credit Cooperative, etc." in paragraph (5)), the subsidiary, etc. prescribed in Article 24, paragraph (2) of the Banking Act as applied mutatis mutandis to Article 94, paragraph (1) of the Labor Bank Act of a labor bank or a federation of labor banks (hereinafter referred to as a "Subsidiary, etc. of a Labor Bank, etc."), or the subsidiary, etc. prescribed in Article 57, paragraph (2) of the Shoko Chukin Bank Limited Act of The Shoko Chukin Bank, Ltd. (hereinafter referred to as a "Subsidiary, etc. of The Shoko Chukin Bank");
(ii) the insurance company prescribed in Article 2, paragraph (2) of the Insurance Business Act (hereinafter referred to as an "Insurance Company"), the insurance holding company prescribed in paragraph (16) of said Article (hereinafter referred to as an "Insurance Holding Company"), the subsidiary, etc. prescribed in Article 128, paragraph (2) of said Act of an Insurance Company (referred to as a "Subsidiary, etc. of an Insurance Company" in paragraph (5)), the subsidiary, etc. prescribed in Article 271-27, paragraph (1) of said Act of an Insurance Holding Company (referred to as a "Subsidiary, etc. of an Insurance Holding Company" in paragraph (5)), or the foreign insurance company, etc. prescribed in Article 2, paragraph (7) of said Act (hereinafter referred to as a "Foreign Insurance Company, etc.");
(iii) the financial instruments business operator prescribed in Article 2, paragraph (9) of the Financial Instruments and Exchange Act (limited to one that engaged in the type I financial instruments business prescribed in Article 28, paragraph (1) of said Act which is categorized as the securities-related business prescribed in paragraph (8) of said Article; hereinafter referred to as a "Financial Instruments Business Operator" in this Chapter and Article 151, paragraph (4)), the designated parent company prescribed in Article 57-12, paragraph (3) of said Act (hereinafter referred to as a "Designated Parent Company"), the subsidiary specified juridical person prescribed in Article 56-2, paragraph (1) of said Act of a Financial Instruments Business Operator (hereinafter referred to as a "Subsidiary Specified Juridical Person of Financial Instruments Business Operator"), or the subsidiary company, etc. prescribed in Article 57-10, paragraph (2) of said Act of a Designated Parent Company (hereinafter referred to as a "Subsidiary Company, etc. of a Designated Parent Company"); or
(iv) the securities finance company prescribed in Article 2, paragraph (30) of the Financial Instruments and Exchange Act (referred to as a "Securities Finance Company" in Article 139, paragraph (2), item (i) and Article 151, paragraph (4)) or any other person specified by Cabinet Order as a person that has an important position in Japan's financial system.
(3) When the Prime Minister intends to give Specified Confirmation with respect to a labor bank, a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc., he/she shall hear the opinion of the Minister of Health, Labour and Welfare in advance, and when the Prime Minister intends to give Specified Confirmation with respect to The Shoko Chukin Bank, Ltd. or a Subsidiary, etc. of The Shoko Chukin Bank, he/she shall hear the opinion of the Minister of Economy, Trade and Industry in advance.
(4) Where the Prime Minister intends to give the Specified Confirmation with respect to any of the Financial Institutions, etc. listed in the items of paragraph (1) which is specified by Cabinet Office Ordinance and Ordinance of the Ministry of Finance, if the Financial Institution, etc. subject to the Specified Confirmation has issued bonds (limited to bonds with a special clause of subordinated contents with regard to the payment of principal and interest, where the obligations pertaining to said bonds will be written down or will be acquired by the Financial Institution, etc. on condition that the Specified Confirmation will be given, and which are specified by Cabinet Office Ordinance and Ordinance of the Ministry of Finance as bonds that contribute to ensuring the soundness of financial conditions in light of the standards on the appropriateness of the adequacy of equity capital and any other financial conditions specified based on the Banking Act and any other laws and regulations) or shares (limited to shares with preferred contents with regard to dividend of surplus and distribution of residual assets, which will be acquired by the Financial Institution, etc. on condition that the Specified Confirmation will be given, and which are specified by Cabinet Office Ordinance and Ordinance of the Ministry of Finance as shares that contribute to ensuring the soundness of financial conditions in light of the standards on the appropriateness of the adequacy of equity capital and any other financial conditions specified based on the Banking Act and any other laws and regulations), or has concluded loans for consumption (limited to loans with a special clause of subordinated contents with regard to the payment of principal and interest, where the obligations pertaining to said loans for consumption will be written down or the claims pertaining to said loans for consumption will be acquired by the Financial Institution, etc. on condition that the Specified Confirmation will be given, and which are specified by Cabinet Office Ordinance and Ordinance of the Ministry of Finance as loans for consumption that contribute to ensuring the soundness of financial conditions in light of the standards on the appropriateness of the adequacy of equity capital and any other financial conditions specified based on the Banking Act and any other laws and regulations), he/she shall decide on the treatment of said bonds, said shares, or said loans for consumption in the equity capital of the Financial Institution, etc. or in any equivalents thereto.
(5) Where the Prime Minister has given the Specified Confirmation pertaining to the Specified Measures Under Item (i), if he/she finds it necessary to enhance the adequacy of equity capital or otherwise improve the financial conditions of the Financial Institution, etc. pertaining to the Specified Confirmation, he/she shall specify a period of time within which an application under Article 126-22, paragraph (1) or (3) may be made by said Financial Institution, etc. or the Financial Institution, etc. which has said Financial Institution, etc. as its Subsidiary, etc. of a Bank, Subsidiary, etc. of a Long Term Credit Bank, Subsidiary, etc. of a Bank Holding Company, Subsidiary, etc. of a Long Term Credit Bank Holding Company, Subsidiary, etc. of a Shinkin Bank, etc., Subsidiary, etc. of a Credit Cooperative, etc., Subsidiary, etc. of a Labor Bank, etc., Subsidiary, etc. of The Shoko Chukin Bank, Subsidiary, etc. of an Insurance Company, Subsidiary, etc. of an Insurance Holding Company, Subsidiary Specified Juridical Person of Financial Instruments Business Operator, or Subsidiary Company, etc. of a Designated Parent Company (hereinafter referred to as a "Subsidiary, etc. of a Financial Institution, etc.").
(6) Specified Confirmation pertaining to the Specified Measures Under Item (ii) with respect to a Financial Institution shall be deemed to be a Category One Insurable Contingency in applying the provisions of Chapter III (excluding Section 4) and Chapter IV (including penal provisions pertaining to these provisions); with regard to the business and obligations pertaining to Deposits, etc. of the Financial Institution subject to the Specified Confirmation that cannot be succeeded to, transferred, or assumed through the Specified Merger, etc. (meaning the Specified Merger, etc. prescribed in Article 126-28, paragraph (2); the same shall apply in Article 126-5, paragraph (1), item (ii) and Article 126-16) pertaining to the Specified Authorization of Eligibility, etc. prescribed in Article 126-31, the Financial Institution pertaining to the Specified Confirmation (excluding a Failed Financial Institution) shall be deemed to be a Failed Financial Institution, and a company that has obtained the authorization under Article 52-17, paragraph (1) of the Banking Act to become a holding company which has as its subsidiary company the bank prescribed in said paragraph through the acquisition of shares of a bank that falls under the Financial Institution or a company that has obtained the authorization under Article 16-2-4, paragraph (1) of the Long-Term Credit Bank Act to become a holding company which has the Long-Term Credit Bank prescribed in said paragraph as its subsidiary company through the acquisition of shares of the Long-Term Credit Bank that falls under the Financial Institution shall be deemed to be a Bank Holding Company, etc. in applying the provisions of Chapter III, Section 4, Chapter III-2 (including the cases where it is applied mutatis mutandis pursuant to Article 127, Article 127-3, and Article 128) and Article 131 to Article 132-2 (including penal provisions pertaining to these provisions); assumption of obligations pertaining to the Deposits, etc. of the Financial Institution by another Financial Institution when such obligations include obligations pertaining to the Deposits, etc. corresponding to amounts of insurance claims calculated under the Insurance Claim Calculation Provision (excluding those associated with a Business Transfer, etc.) shall be deemed to be Transfer of Insured Deposits in applying the provisions of Article 56, Chapter III, Section 4, and Article 131 (including penal provisions pertaining to these provisions); and a Financial Institution subject to the Specified Certification shall be deemed to be a Financial Institution under Management, a Specified Bridge Bank shall be deemed to be a Bridge Bank, the Corporation shall be deemed to be a financial administrator, and Specified Certification for a Financial Institution subject to the Specified Certification shall be deemed to be a Injunction Ordering Management with respect to a Financial Institution under Management in applying the provisions of Chapter VI, Article 133, and Article 135 (including penal provisions pertaining to these provisions). In this case, the term "notice is received under Article 55, paragraph (1) or (2)" in Article 56, paragraph (1), item (i) and paragraph (3), item (i) of said Article shall be deemed to be replaced with "notice to the Corporation (limited to notice made in the event that the Specified Certification prescribed in Article 126-2, paragraph (1) pertaining to the Specified Measures Under Item (ii) prescribed in item (ii) of said paragraph has been given) is received under paragraph (7) of said Article."
(7) Upon giving the Specified Confirmation, the Prime Minister shall announce such fact and, if the Specified Confirmation is in relation to the Specified Measures Under Item (i), the period of time specified under paragraph (5) to the Financial Institution, etc. subject to said Specified Confirmation or the Financial Institution, etc. which has said Financial Institutions, etc. as a Subsidiary, etc. of a Financial Institution, etc., and the Corporation, and give public notice thereof in the official gazette.
(8) Upon making a decision pursuant to paragraph (4), the Prime Minister shall make the details thereof public.
(9) Upon giving the Specified Confirmation, the Prime Minister shall report the details of said Specified Confirmation to the Diet.
(10) An Insurance Company or Foreign Insurance Company, etc. subject to Specified Confirmation pertaining to Specified Measures Under Item (ii) shall be deemed to be the Failed Insurance Company prescribed in Article 260, paragraph (2) of the Insurance Business Act or the Specified Insurance Company prescribed in Article 270-6-6, paragraph (1) of said Act in applying the provisions of Part II, Chapter X and Article 311-3, paragraph (1) (including penal provisions pertaining to these provisions) of said Act.
(11) Necessary matters for application of the provisions of paragraph (1) to a Foreign Bank Branch, Foreign Insurance Company, etc., or any other person specified by Cabinet Office Ordinance and Ordinance of the Ministry of Finance shall be specified Cabinet Office Ordinance and Ordinance of the Ministry of Finance.
(12) Necessary matters for application of the provisions of paragraphs (6) and (10) shall be specified by Cabinet Order.
(13) A person subject to Specified Confirmation shall be deemed to be a Financial Institution, etc. with regard to application of the provisions of this Act even in cases where the license from the Prime Minister set forth in Article 4, paragraph (1) of the Banking Act for said person has been rescinded, where said license has lost its effect, or where any event specified by Cabinet Office Ordinance and Ordinance of the Ministry of Finance has occurred.
(Special Surveillance by the Corporation)
Article 126-3 (1) When Specified Confirmation has been given, the Prime Minister (in the event that the Financial Institution, etc. subject to the surveillance under this paragraph (hereinafter referred to as "Special Surveillance") is a labor bank, a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc., the Prime Minister and the Minister of Health, Labour and Welfare, and in the event that it is The Shoko Chukin Bank, Ltd. or a Subsidiary, etc. of The Shoko Chukin Bank, the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry; the same shall apply in paragraph (3), paragraph (4) (including the cases where it is applied mutatis mutandis pursuant to Article 126-11, paragraph (2)), and paragraph (5), paragraph (1) of said Article, Article 126-12, paragraph (1), and Article 126-15)) shall immediately designate the Financial Institution, etc. subject to said Specified Confirmation as the person whose execution of business, and management and disposition of property shall be placed under the surveillance of the Corporation.
(2) When the designation under the preceding paragraph (hereinafter referred to as "Designation of Special Surveillance") has been made, the Corporation may give necessary advice, instructions, or recommendations (hereinafter referred to as "Advice, etc." in this paragraph) for ensuring the implementation of the plan prepared pursuant to paragraph (5) and any other necessary advice, etc. to the Financial Institution, etc. subject to said Designation of Special Surveillance (hereinafter referred to as the "Financial Institution, etc. under Special Surveillance") with regard to the execution of its business, and management and disposition of its property.
(3) When the Prime Minister finds it necessary for avoiding the risk of severe disruption being caused in the financial system in Japan, he/she may order necessary measures to the Financial Institution, etc. under Special Surveillance with regard to execution of its business, and management and disposition of its property while specifying the time limit by which the measures should be taken.
(4) Upon making Designation of Special Surveillance, the Prime Minister shall notify the Financial Institution, etc. under Special Surveillance and the Corporation to that effect and give public notice thereof in the official gazette.
(5) The Prime Minister may, when he/she finds it necessary, request a Financial Institution, etc. under Special Surveillance to submit reports or materials with regard to the status of business and property, etc. of the Financial Institution, etc. under Special Surveillance or order a Financial Institution, etc. under Special Surveillance to prepare a plan for its management and submit it to the Prime Minister and the Corporation.
(Special Surveillance Agent)
Article 126-4 (1) In the event that Designation of Special Surveillance has been made, the Corporation may, when it finds necessary, entrust the whole or part of implementation of surveillance pertaining to said Designation of Special Surveillance to a third party.
(2) With regard to entrustment under the preceding paragraph, the approval of the Prime Minister (in the event that the Financial Institution, etc. under Special Surveillance is a labor bank, a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc., the Prime Minister and the Minister of Health, Labour and Welfare, and in the event that it is The Shoko Chukin Bank, Ltd. or a Subsidiary, etc. of The Shoko Chukin Bank, the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry; the same shall apply in the following paragraph) shall be obtained.
(3) A Special Surveillance Agent (meaning the third party to whom entrustment was made pursuant to paragraph (1); the same shall apply hereinafter) may receive advance payments of costs as well as remuneration determined by the Prime Minister.
(Injunction Ordering Specified Management)
Article 126-5 (1) When the Prime Minister (in the event that the Financial Institution, etc. pertaining to the Injunction Ordering Specified Management prescribed in this paragraph is a labor bank, a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc., the Prime Minister and the Minister of Health, Labour and Welfare, and in the event that it is The Shoko Chukin Bank, Ltd. or a Subsidiary, etc. of The Shoko Chukin Bank, the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry; the same shall apply in paragraph (3) (including cases where applied mutatis mutandis pursuant to Article 126-7, paragraph (2)), paragraph (2) and paragraph (3) of the following Article, Article 126-7, paragraph (1), Article 126-8, and Article 79, paragraphs (1) (including cases where applied mutatis mutandis pursuant to paragraph (3) of said Article) and Article 84, paragraph (1) as applied mutatis mutandis pursuant to Article 126-9, and Article 126-10) finds that any of the following requirements is satisfied in a case where Specified Confirmation pertaining to Specified Measures Under Item (ii) has been given, he/she may issue a injunction ordering that the business and property of the Financial Institution, etc. subject to the Specified Confirmation be placed under management of the Corporation (hereinafter referred to as a "Injunction Ordering Specified Management"). In this case, the provisions of Article 74, paragraph (1), paragraph (2), and paragraph (5) shall not apply:
(i) the operation of said Financial Institution, etc.'s business is extremely inappropriate; or
(ii) if a Specified Merger, etc. is not carried out with regard to the business or obligations of the Financial Institution, etc. and such Financial Institution, etc. abolishes all its businesses or is dissolved, severe disruption is likely to be caused in the financial system in Japan by the abolition of business or default of obligations.
(2) When a Injunction Ordering Specified Management has been issued, the right to represent the Financial Institution, etc. subject to the Injunction Ordering Specified Management, execute its business, and manage and dispose of its property shall be vested exclusively in the Corporation. The same shall apply to the rights of a director and executive officer (in the event that the Financial Institution, etc. subject to the Injunction Ordering Specified Management is a Shinkin Bank, etc., a director) prescribed in Article 828, paragraphs (1) and (2) of the Companies Act (including the cases where these provisions are applied mutatis mutandis pursuant to Article 28 of the Shinkin Bank Act, Article 52-2 (including the cases where it is applied mutatis mutandis pursuant to Article 58, paragraph (7) of said Act) and Article 61-7 of said Act, Article 32 of the Small and Medium Sized Enterprises Cooperatives Act, Article 57 (including the cases where it is applied mutatis mutandis pursuant to Article 57-3, paragraph (6) of said Act) and Article 67 of said Act, Article 28 of the Labor Bank Act, Article 57-2 (including the cases where it is applied mutatis mutandis pursuant to Article 62, paragraph (7) of said Act) and Article 65 of said Act, and Article 30-15, Article 57, paragraph (6), Article 60-2, paragraph (5), and Article 171 of the Insurance Business Act), Article 831 of the Companies Act (including the cases where it is applied mutatis mutandis pursuant to Article 24, paragraph (10) and Article 48-8 of the Shinkin Bank Act, Article 27, paragraph (8), Article 54, Article 82, paragraph (4) and Article 82-10, paragraph (4) of the Small and Medium Sized Enterprises Cooperatives Act, Article 24, paragraph (11) and Article 54 of the Labor Bank Act, and Article 30-8, paragraph (6), Article 41, paragraph (2), and Article 49, paragraph (2) of the Insurance Business Act), and Article 84-2, paragraph (2) and Article 96-16, paragraph (2) of the Insurance Business Act.
(3) Upon issuing a Injunction Ordering Specified Management, the Prime Minister shall notify the Corporation to that effect and give public notice thereof in the official gazette.
(4) The provisions of Article 80 and Article 81, paragraph (1) of the Corporate Reorganization Act shall apply mutatis mutandis to the Corporation in the event that a Injunction Ordering Specified Management has been issued, and the provisions of Article 78 of the Act on General Incorporated Associations and General Incorporated Foundations shall apply mutatis mutandis to a Financial Institution, etc. subject to the Injunction Ordering Specified Management. In this case, the term "court" in Article 81, paragraph (1) of the Corporate Reorganization Act shall be deemed to be replaced with "Prime Minister (in the event that the Financial Institution, etc. prescribed in Article 126-2, paragraph (2) of the Deposit Insurance Act subject to the Injunction Ordering Specified Management prescribed in Article 126-5, paragraph (1) of said Act is a labor bank, a federation of labor banks, or the Subsidiary, etc. of a Labor Bank, etc. prescribed in Article 126-2, paragraph (2), item (i) of said Act, the Prime Minister and the Minister of Health, Labour and Welfare, and in the event that it is The Shoko Chukin Bank, Ltd. or the Subsidiary, etc. of The Shoko Chukin Bank prescribed in said item, the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry)" and the term "its representative director or other representatives" in Article 78 of the Act on General Incorporated Associations and General Incorporated Foundations shall be deemed to be replaced with "the Deposit Insurance Corporation in the event that the Injunction Ordering Specified Management prescribed in Article 126-5, paragraph (1) of the Deposit Insurance Act has been issued."
(5) A Financial Institution subject to a Injunction Ordering Specified Management shall be deemed to be a Financial Institution subject to a Injunction Ordering Management under Article 74, paragraph (1) or paragraph (2) in applying the provisions of Article 69-3, paragraph (1) (including the cases where it is applied mutatis mutandis pursuant to Article 127 and Article 128), and an Insurance Company or Foreign Insurance Company, etc. subject to a Injunction Ordering Specified Management shall be deemed to be the Managed Company prescribed in Article 242, paragraph (1) of the Insurance Business Act, and the Corporation in the event that a Injunction Ordering Specified Management has been issued shall be deemed to be an insurance administrator in applying the provisions of Article 247, Article 250, paragraph (1), Article 254, paragraph (1), and Article 255-2, paragraph (1) (including penal provisions pertaining to these provisions) of said Act.
(6) When a Injunction Ordering Specified Management has been issued for a Financial Institution, etc., Special Surveillance pertaining to said Financial Institution, etc. shall be suspended until the Injunction Ordering Specified Management is concluded.
(Corporation Representative)
Article 126-6 (1) When a Injunction Ordering Specified Management has been issued, the Corporation may appoint an agent (hereinafter referred to as a "Corporation Agent") who will conduct the whole or part of the business pertaining to the Injunction Ordering Specified Management.
(2) With regard to the appointment of a Corporation Agent set forth in the preceding paragraph, the approval of the Prime Minister shall be obtained.
(3) A Corporation Agent may receive advance payment of costs and receive the consideration specified by the Prime Minister.
(Rescission of a Injunction Ordering Specified Management)
Article 126-7 (1) The Prime Minister shall rescind the Injunction Ordering Specified Management, when he/she finds that there is no longer any need for said Injunction Ordering Specified Management.
(2) The provisions of Article 126-5, paragraph (3) shall apply mutatis mutandis to the case set forth in the preceding paragraph.
(Preparation and Submission of a Plan)
Article 126-8 In the event that a Injunction Ordering Specified Management has been issued, the Prime Minister may, when he/she finds it necessary, request the Corporation to submit reports or materials with regard to the status of business and property, etc. of the Financial Institution, etc. subject to the Injunction Ordering Specified Management or order a Financial Institution, etc. subject to the Injunction Ordering Specified Management to prepare and submit a plan for its management or to take other necessary measures.
(Application Mutatis Mutandis of Provisions Concerning Financial Administrator, etc.)
Article 126-9 The provisions of Article 79 shall apply mutatis mutandis to a Financial Institution, etc. subject to the Injunction Ordering Specified Management, the provisions of Article 82 shall apply mutatis mutandis to a Corporation Representative, and the provisions of Articles 83 and 84 shall apply mutatis mutandis to the Corporation in the event that a Injunction Ordering Specified Management has been issued. In this case, the term "issued a Injunction Ordering Management or rescinded a Injunction Ordering Management" in Article 79, paragraph (1) shall be deemed to be replaced with "issued a Injunction Ordering Specified Management (meaning the Injunction Ordering Specified Management prescribed in Article 126-5, paragraph (1); the same shall apply hereinafter) or rescinded a Injunction Ordering Specified Management," the term "office" in said paragraph shall be deemed to be replaced with "office (in the event that the head office or principal office is in a foreign state, the principal business office or office in Japan)," the term "a financial administrator" in paragraph (2) of said Article shall be deemed to be replaced with "the Corporation," the term "director, accounting advisor, corporate auditor or accounting auditor of a Financial Institution under Management (in the event that the Financial Institution under Management is a company with committees, a director, executive officer, accounting advisor or accounting auditor, and in the event that the Financial Institution under Management is a Shinkin Bank, etc., a director, inspector or accounting auditor)" in Article 83, paragraph (1) shall be deemed to be replaced with "director, executive officer, member who executes business, representative in Japan, accounting advisor, corporate auditor, or a person equivalent to any of these, or accounting auditor of the Financial Institution, etc. prescribed in Article 126-2, paragraph (2) subject to a Injunction Ordering Specified Management," and the term "Financial Institution under Management" in Article 84, paragraph (1) shall be deemed to be replaced with "Financial Institution, etc. prescribed in Article 126-2, paragraph (2) subject to a Injunction Ordering Specified Management," and any other necessary technical replacement of terms shall be specified by Cabinet Order.
(Conclusion of Specified Management)
Article 126-10 The Corporation shall conclude the management of a Financial Institution, etc. subject to a Injunction Ordering Specified Management by transferring its business or taking any other necessary measures for avoiding the risk of severe disruption being caused in the financial system in Japan and other related measures within one year from the date of the Injunction Ordering Specified Management; provided, however, that in cases where it is impossible to conclude the management within said period due to unavoidable circumstances, said period may be extended for a period not exceeding one year with the approval of the Prime Minister.
(Rescission of Designation of Special Surveillance)
Article 126-11 (1) The Prime Minister shall rescind the Designation of Special Surveillance when he/she finds that there is no longer any need for said Designation of Special Surveillance.
(2) The provisions of Article 126-3, paragraph (4) apply mutatis mutandis to the case referred to in the preceding paragraph.
(Conclusion of Special Surveillance)
Article 126-12 (1) The Corporation shall conclude Special Surveillance of a Financial Institution, etc. pertaining to Designation of Special Surveillance by transferring its business or taking any other necessary measures for avoiding the risk of severe disruption being caused in the financial system in Japan and other related measures within one year from the date of the Designation of Special Surveillance; provided, however, that in cases where it is impossible to conclude the Special Surveillance within said period due to unavoidable circumstances, said period may be extended for a period not exceeding one year with the approval of the Prime Minister.
(2) Upon concluding Special Surveillance pursuant to the preceding paragraph, the Corporation shall notify the Financial Institution, etc. under Special Surveillance to that effect and give public notice thereof.
(Permission in Lieu of Extraordinary Resolution of Shareholders Meeting, etc.)
Article 126-13 (1) In the event that a Financial Institution, etc. under Special Surveillance that is a stock company is unable to satisfy its obligations in full with its assets or is likely to be unable to satisfy its obligations in full with its assets, or has suspended payment of obligations or is likely to suspend payment of obligations, said Financial Institution, etc. under Special Surveillance may, notwithstanding the provisions of Article 111, paragraph (2), Article 171, paragraph (1), Article 199, paragraph (2), Article 204, paragraph (2), Article 447, paragraph (1), Article 466, Article 467, paragraph (1), items (i) and (ii), Article 783, paragraph (1), and Article 804, paragraph (1) of the Companies Act and Article 136 of the Insurance Business Act, carry out the following matters with the permission of the court; in this case, with regard to application of the provisions of Article 172, paragraph (1) of the Companies Act in the case of carrying out the matters prescribed in item (i), the term "the following shareholders" in said paragraph shall be deemed to be replaced with "all shareholders," and the term "the day of the shareholders meeting under that paragraph" in said paragraph shall be deemed to be replaced with "the day on which the public notice set forth in Article 126-13, paragraph (11) of the Deposit Insurance Act (Act No. 34 of 1971) was given":
(i) amendment of the articles of incorporation necessary for the issuance of Class Shares Subject to Wholly Call, acquisition of all of the Class Shares Subject to Wholly Call or determination of the subscription requirements prescribed in Article 199, paragraph (2) of the Companies Act pertaining to the issuance of the shares for subscription prescribed in paragraph (1) of said Article conducted together with such acquisition or determination of allotment of the shares for subscription prescribed in said paragraph under Article 204, paragraph (2) of said Act;
(ii) reduction in the amount of stated capital;
(iii) transfer of all or a material portion of its business;
(iv) company split; and
(v) transfer of insurance contracts.
(2) In the event that a Financial Institution, etc. under Special Surveillance that is a Shinkin Bank, etc. is unable to satisfy its obligations in full with its assets or is likely to be unable to satisfy its obligations in full with its assets, or has suspended payment of obligations or is likely to suspend payment of obligations, said Financial Institution, etc. under Special Surveillance may, notwithstanding the provisions of Article 48-3 and Article 58, paragraph (1) of the Shinkin Bank Act, Article 53 and Article 57-3, paragraph (1) of the Small and Medium-Sized Enterprise Cooperatives Act, and Article 53 and Article 62, paragraph (1) of the Labor Bank Act, transfer its business with the permission of the court.
(3) In the event that a Financial Institution, etc. under Special Surveillance that is a Mutual Company (meaning the mutual company prescribed in Article 2, paragraph (5) of the Insurance Business Act; the same shall apply hereinafter) is unable to satisfy its obligations in full with its assets or is likely to be unable to satisfy its obligations in full with its assets, or has suspended payment of obligations or is likely to suspend payment of obligations, said Financial Institution, etc. under Special Surveillance may, notwithstanding the provisions of Article 62-2, paragraph (1), items (i) and (ii) and Article 136 of said Act, carry out the following matters with the permission of the court:
(i) transfer of all or a material portion of its business; and
(ii) transfer of insurance contracts.
(4) In the event that a Financial Institution, etc. under Special Surveillance is unable to satisfy its obligations in full with its assets or is likely to be unable to satisfy its obligations in full with its assets, or has suspended payment of obligations or is likely to suspend payment of obligations, when the Corporation finds it to be inappropriate to have the director, executive officer, accounting advisor, corporate auditor or accounting auditor (hereinafter referred to as the "Officer, etc." in this Article) of the Financial Institution, etc. under Special Surveillance continue to carry out his/her duties, the Corporation may, notwithstanding the provisions of Article 339, paragraph (1) of the Companies Act (including the cases where it is applied by replacing the terms pursuant to the provisions of Article 347, paragraph (1) of said Act) and Article 403, paragraph (1) of said Act, Article 35-8, paragraph (1), of the Shinkin Bank Act, Article 42, paragraph (1) of the Small and Medium-Sized Enterprises Cooperatives Act, Article 37-6, paragraph (1) of the Labor Bank Act, and Article 53-8, paragraph (1) and Article 53-27, paragraph (1) of the Insurance Business Act, dismiss the Officer, etc. of the Financial Institution, etc. under Special Surveillance with the permission of the court.
(5) In the event that the Corporation intends to dismiss any Officer, etc. of a Financial Institution, etc. under Special Surveillance under the preceding paragraph, when the number of Officers, etc. will fail to meet the number prescribed by an Act or by the articles of incorporation, the Corporation may, notwithstanding the provisions of Article 329, paragraph (1) and Article 402, paragraph (2) of the Companies Act, Article 32, paragraph (3) of the Shinkin Bank Act, Article 35, paragraph (3) of the Small and Medium-Sized Enterprises Cooperatives Act, Article 32, paragraph (3) of the Labor Bank Act, and Article 52, paragraph (1) and Article 53-26, paragraph (2) of the Insurance Business Act, appoint an Officer, etc. of the Financial Institution, etc. under Special Surveillance with the permission of the court.
(6) The Officer, etc. (excluding an executive officer; hereinafter the same shall apply in this paragraph) of a Financial Institution, etc. under Special Surveillance appointed under the preceding paragraph shall resign at the conclusion of the first annual shareholders meeting, ordinary general meeting (in cases where a general meeting of representatives is established, at which it is possible to appoint Officers, etc., the ordinary general meeting of representatives), or annual general meeting of members (in cases where a general meeting of representatives is established, at which it is possible to appoint exective officer, the annual general meeting of representatives) convened after the conclusion of the Special Surveillance, and an executive officer shall resign at the completion of the first meeting of the board of directors held after the conclusion of said shareholders meeting or annual general meeting of members (in cases where a general meeting of representatives is established, at which it is possible to appoint Officers, etc., the annual general meeting of representatives).
(7) When the permission prescribed in paragraphs (1) to (5) has been granted, it shall be deemed that a resolution of a shareholders meeting, class meeting (in the case of the Shinkin Bank, etc., general meeting or general meeting of representatives, and in the case of a Mutual Company, general meeting of members or general meeting of representatives) or board of directors meeting has been adopted concerning matters pertaining to said permission. With regard to application of the provisions of Article 16, paragraph (1), Article 136-2, paragraph (1), and Article 250, paragraphs (3) and (5) of the Insurance Business Act in this case, the term "two weeks before the date of the shareholders meeting related to the resolution on the reduction (or, the date of the board of directors meeting where Article 447, paragraph (3) (Reductions in Amount of Capital) or Article 448, paragraph (3) (Reductions in Amount of Reserves) of the Companies Act)" in Article 16, paragraph (1) of said Act shall be deemed to be "a day within two weeks after the grant of the permission set forth in Article 126-13, paragraph (1) of the Deposit Insurance Act (Act No. 34 of 1971) pertaining to the reduction," the term "two weeks before the date of the Shareholders' Meeting, etc. set forth in Article 136, paragraph (1) " in Article 136-2, paragraph (1) of said Act shall be deemed to be replaced with "a day within two weeks after the grant of the permission set forth in Article 126-13, paragraph (1) or paragraph (3) of the Deposit Insurance Act pertaining to transfer of insurance contracts," and the term "the following paragraph" in Article 250, paragraph (3), item (i) of said Act and the term "the preceding paragraph" in paragraph (5) of said Article shall be deemed to be replaced with "Article 126-13, paragraph (11) of the Deposit insurance Act," and the provisions of paragraph (4) of said Article shall not apply.
(8) In the event that a Financial Institution, etc. under Special Surveillance is unable to satisfy its obligations in full with its assets or is likely to be unable to satisfy its obligations in full with its assets, or has suspended payment of obligations or is likely to suspend payment of obligations, when the Corporation finds it to be inappropriate to have the representative in Japan of the Financial Institution, etc. under Special Surveillance continue to carry out his/her duties, the Corporation may, notwithstanding the provisions of Article 817, paragraph (1) of the Companies Act and Article 193, paragraph (1) of the Insurance Business Act, specify the representative in Japan of the Financial Institution, etc. under Special Surveillance with the permission of the court.
(9) The representative in Japan of a Financial Institution, etc. under Special Surveillance specified pursuant to the preceding paragraph shall resign at the conclusion of the Special Surveillance.
(10) The district court having jurisdiction over the location of the head office or principal office of the Financial Institution, etc. under Special Surveillance (in the event that the head office or principal office is in a foreign state, the principal business office or office in Japan) shall have jurisdiction over cases pertaining to the permission prescribed in paragraphs (1) to (5) and paragraph (8) (hereinafter referred to as "Substituted Permission" in this Article).
(11) The court shall, when it has made a Substituted Permission, serve a written decision thereof on the Financial Institution, etc. under Special Surveillance and give public notice of the gist of the decision.
(12) The public notice under the preceding paragraph shall be published in the official gazette.
(13) A decision on the Substituted Permission shall take effect as from the time of service thereof on the Financial Institution, etc. under Special Surveillance under paragraph (11).
(14) Shareholders, members or association members of Shinkin Banks, etc., members of Mutual Companies, or foreign companies or Foreign Insurance Company, etc. may make an immediate appeal against a decision on the Substituted Permission within an unextendable period of two weeks from the date of the public notice set forth in paragraph (11).
(15) The provisions of Article 5, Article 6, Article 7, paragraph (2), Article 40, Article 41, Article 56, paragraph (2), and Article 66, paragraphs (1) and (2) of the Non-Contentious Cases Procedures Act shall not apply to cases pertaining to the Substituted Permission.
(16) The provisions of Article 88 shall apply mutatis mutandis to the case where Substituted Permission pertaining to matters specified in paragraph (1), item (i), (ii), or (iv) or matters prescribed in paragraph (4) or (5) has been granted.
(Request for Suspension of Collection of Claims, etc.)
Article 126-14 When the Corporation finds that orderly resolution of assets and liabilities of said Financia Institutions, etc. under Special Surveillance is likely to be hindered if a Financial Institution, etc. that is a creditor of a Financial Institution, etc. under Special Surveillance (in the event that the Financial Institution, etc. under Special Surveillance is a Foreign Bank Branch, a creditor of the foreign bank prescribed in Article 10, paragraph (2), item (viii) of the Banking Act (hereinafter referred to as a "Foreign Bank") pertaining to said Foreign Bank Branch) collects claims from the Financial Institution, etc. under Special Surveillance or exercises any other right of a creditor specified by Cabinet Office Ordinance and Ordinance of the Ministry of Finance, the Corporation shall request said Financial Institution, etc. to refrain from exercising said right until transfer of business is conducted or any other necessary measures for avoiding the risk of severe disruption being caused in the financial system in Japan are taken.
(Opinion, etc. by Prime Minister Pertaining to Petition for Commencement of Bankruptcy Proceedings, etc.)
Article 126-15 When a petition has been filed against a Financial Institution, etc. under Special Surveillance for commencement of bankruptcy proceedings (in the event that the Financial Institution, etc. under Special Surveillance is a Foreign Bank Branch, commencement of bankruptcy proceedings of the Foreign Bank pertaining to said Foreign Bank Branch), commencement of rehabilitation proceedings (in the event that the Financial Institution, etc. under Special Surveillance is a Foreign Bank Branch, commencement of rehabilitation proceedings of the Foreign Bank pertaining to said Foreign Bank Branch), commencement of reorganization proceedings (in the event that the Financial Institution, etc. under Special Surveillance is a Foreign Bank Branch, commencement of reorganization proceedings of the Foreign Bank pertaining to said Foreign Bank Branch), commencement of special liquidation (in cases where the Financial Institution, etc. under Special Surveillance is a Foreign Company, Foreign Bank Branch, or Foreign Insurance Company, etc., commencement of liquidation under the provisions of Article 822, paragraph (1) of the Companies Act (including the cases where it is applied mutatis mutandis pursuant to Article 213 of the Insurance Business Act; the same shall apply hereinafter)) or recognition of foreign insolvency proceedings (in the event that the Financial Institution, etc. under Special Surveillance is a Foreign Bank Branch, recognition of foreign insolvency proceedings of the Foreign Bank pertaining to said Foreign Bank Branch), the Prime Minister may, before a ruling or order is given on said petition, state that measures for orderly resolution of assets and liabilities of said Financial Institution, etc. under Special Surveillance have been taken, and state any other matters concerning said Financial Institution, etc. under Special Surveillance, and express opinions on the timing of said ruling or order and other matters to the court.
(Seizure-Prohibited Movables, etc.)
Article 126-16 A movable or claim pertaining to the business of a Financial Institution, etc. subject to Specified Confirmation pertaining to Specified Measures Under Item (ii) which the Specified Assuming Financial Institution, etc. prescribed in Article 126-28, paragraph (1) or the Specified Assuming Holding Company, etc. prescribed in said paragraph succeeds to or receives by transfer though Specified Merger, etc. (limited to those designated by the Prime Minister (in the event that the Financial Institution, etc. subject to Specified Confirmation pertaining to Specified Measures Under Item (ii) is a labor bank, a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc., the Prime Minister and the Minister of Health, Labour and Welfare, and in the event that it is The Shoko Chukin Bank, Ltd. or a Subsidiary, etc. of The Shoko Chukin Bank, the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry)) may not be seized.
(Retention of Assets Within Japan)
Article 126-17 The Prime Minister (in the event that the Financial Institution, etc. subject to Specified Confirmation is a labor bank, a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc., the Prime Minister and the Minister of Health, Labour and Welfare, and in the event that it is The Shoko Chukin Bank, Ltd. or a Subsidiary, etc. of The Shoko Chukin Bank, the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry) may, when and to the extent that he/she finds it necessary for smoothly implementing the orderly resolution of assets and liabilities of the Financial Institution, etc. subject to Specified Confirmation, order said Financial Institution, etc. to retain part of its assets specified by Cabinet Order, within Japan, pursuant to the provisions of the Cabinet Order.
(Application Mutatis Mutandis of Provisions Concerning Financial Administrator, etc.)
Article 126-18 The provisions of Articles 76 and 86 shall apply mutatis mutandis to a Financial Institution, etc. under Special Surveillance (limited to a Financial Institution, etc. under Special Surveillance that is unable to satisfy its obligations in full with its assets or is likely to be unable to satisfy its obligations in full with its assets, or has suspended payment of obligations or is likely to suspend payment of obligations), the provisions of Article 82 shall apply mutatis mutandis to a Special Surveillance Agent, and the provisions of Article 89 shall apply mutatis mutandis to a Financial Institution, etc. under Special Surveillance. In this case, the term "a Bank, etc. or The Shoko Chukin Bank, Ltd." in Article 76, paragraph (1) shall be deemed to be replaced with "a stock company"; the term "in the event that the Financial Institution under Management set forth in said paragraph is The Shoko Chukin Bank, Ltd." in paragraph (2) of said Article shall be deemed to be replaced with "in the event that the Financial Institution under Management set forth in said paragraph is the Subsidiary, etc. of a Labor Bank, etc. prescribed in Article 126-2, paragraph (2), item (i), the term 'the Prime Minister' in the previous paragraph shall be deemed to be replaced with 'the Prime Minister and the Minister of Health, Labour and Welfare,' and in the event that it is The Shoko Chukin Bank, Ltd. or a Subsidiary, etc. of The Shoko Chukin Bank"; the term "a Financial Institution under Management" in Article 86, paragraph (1) shall be deemed to be replaced with "a Financial Institution, etc. under Special Surveillance (limited to the Financial Institution, etc. under Special Surveillance prescribed in Article 126-3, paragraph (2) that is unable to satisfy its obligations in full with its assets or is likely to be unable to satisfy its obligations in full with its assets, or has suspended payment of obligations or is likely to suspend payment of obligations; hereinafter the same shall apply in this Article) and that is not the Mutual Company prescribed in Article 2, paragraph (5) of the Insurance Business Act"; the term "resolutions or decisions under Article 48-3 of the Shinkin Bank Act, Article 53 of the Small and Medium Sized Enterprises Cooperatives Act, or Article 53 of the Labor Bank Act, and" in said paragraph shall be deemed to be replaced with "resolutions or decisions under Article 48-3 of the Shinkin Bank Act, Article 53 of the Small and Medium Sized Enterprises Cooperatives Act, or Article 53 of the Labor Bank Act,"; the term "resolutions or decisions under Article 22, paragraph (2), Article 29, paragraph (4) or Article 35, paragraph (2) of the Act on Financial Institutions' Merger and Conversion" in said paragraph shall be deemed to be replaced with "resolutions or decisions under Article 22, paragraph (2), Article 29, paragraph (4) or Article 35, paragraph (2) of the Act on Financial Institutions' Merger and Conversion, and resolutions under Article 69, paragraph (2), Article 136, paragraph (2), Article 144, paragraph (3), Article 165-3, paragraph (2), or Article 165-10, paragraph (2) of the Insurance Business Act"; the term "a Financial Institution under Management" in paragraph (2) of said Article shall be deemed to be replaced with "a Financial Institution, etc. under Special Surveillance that is not the Mutual Company prescribed in Article 2, paragraph (5) of the Insurance Business Act"; the term "resolutions of a shareholders meeting or class meeting specified in each item of Article 309, paragraph (3) or Article 324, paragraph (3) of the Companies Act and" in said paragraph shall be deemed to be replaced with "resolutions of a shareholders meeting or class meeting specified in each item of Article 309, paragraph (3) or Article 324, paragraph (3) of the Companies Act,"; the term "resolutions under Article 22, paragraph (3) of the Act on Financial Institutions' Merger and Conversion" in said paragraph shall be deemed to be replaced with "resolutions under Article 22, paragraph (3) of the Act on Financial Institutions' Merger and Conversion, and resolutions under Article 165-3, paragraph (4) or (6) or Article 165-10, paragraph (6) of the Insurance Business Act"; the term "a Financial Institution under Management" in paragraph (3) of said Article shall be deemed to be replaced with "a Financial Institution, etc. under Special Surveillance that is not the Mutual Company prescribed in Article 2, paragraph (2) of the Insurance Business Act"; the term "may, notwithstanding the provisions of the same paragraph, be made provisionally by a majority of the shareholders present and three-quarters or more of the votes held by the shareholders present" in said paragraph shall be deemed to be replaced with "may, notwithstanding the provisions of the same paragraph, be made provisionally by a majority of the shareholders present and three-quarters or more of the votes held by the shareholders present, and in a Financial Institution, etc. under Special Surveillance that is the Mutual Company prescribed in Article 2, paragraph (5) of the Insurance Business Act, resolutions under Article 57, paragraph (2), Article 60, paragraph (2), Article 62, paragraph (2), Article 62-2, paragraph (2), Article 86, paragraph (2), Article 136, paragraph (2), Article 144, paragraph (3), Article 156, or Article 165-16, paragraph (2) (including the cases where it is applied mutatis mutandis pursuant to Article 165-20 of said Act) of said Act, notwithstanding these provisions, be made provisionally by three-quarters or more of the votes held by the members (in cases where a general meeting of representatives is established, the representatives) present"; the term "the shareholders meeting, etc. prescribed in Article 66, paragraph (2)" in paragraph (4) of said Article shall be deemed to be replaced with "in the case of a stock company, a shareholders meeting or class meeting (in the case prescribed in Article 22, paragraph (6) of the Act on Financial Institutions' Merger and Conversion, a shareholders meeting and the shareholders meeting set forth in said paragraph), and in the case of a Shinkin Bank, etc., a general meeting (in cases where a general meeting of representatives is established, the general meeting of representatives)"; the term "In this case" in paragraph (7) of said Article shall be deemed to be replaced with "In this case, the term 'its Shareholders, etc.' in paragraph (4) shall be deemed to be replaced with 'its Shareholders, etc. or, in the case of the Mutual Company prescribed in Article 2, paragraph (5) of the Insurance Business Act, its members (in cases where a general meeting of representatives is established, its representatives)'; the term 'meaning the shareholders meeting, etc. prescribed in Article 66, paragraph (2)' in said paragraph shall be deemed to be replaced with 'meaning the shareholders meeting, etc. prescribed in Article 66, paragraph (2) and, in the case of the Mutual Company prescribed in Article 2, paragraph (5) of the Insurance Business Act, a general meeting of members (in cases where a general meeting of representatives is established, the general meeting of representative)'"; the term "the term 'a majority as prescribed in paragraph (1)'" in said paragraph shall be deemed to be replaced with "and the term 'a majority as prescribed in paragraph (1)'"; and the term "a Bank, etc. or The Shoko Chukin Bank, Ltd." in Article 89 shall be deemed to be replaced with "a stock company"; and any other necessary technical replacement of terms shall be specified by Cabinet Order.
(Loan of Funds, etc. Necessary for Avoiding the Risk of Severe Disruption Being Caused in the Financial System)
Article 126-19 (1) In the event that the Corporation receives from a Financial Institution, etc. subject to Specified Confirmation pertaining to Specified Measures Under Item (i) an application for Loan of Funds, etc. (meaning the loan of funds necessary for avoiding the risk of severe disruption being caused in the financial system in Japan or guarantee of obligations necessary for avoiding the risk of severe disruption being caused in the financial system in Japan), the Corporation may, when it finds it necessary, and following a resolution of the Policy Board, decide to provide the loan or the guarantee of obligations pertaining to said application within the limit necessary.
(2) When a loan under the preceding paragraph has been provided or when the obligations pertaining to guarantee of obligations under said paragraph have been paid, the Corporation shall have the right to have its claims satisfied out of the assets of the Financial Institution, etc. pertaining to the right to reimbursement based on said loan or said guarantee of obligations in preference over other creditors.
(3) The order of the statutory lien under the preceding paragraph shall be next to the general statutory lien under the provisions of the Civil Code.
(Rescission of the Specified Confirmation Pertaining to Specified Measures Under Item (i))
Article 126-20 (1) If a Financial Institution, etc. subject to Specified Confirmation pertaining to Specified Measures Under Item (i) falls under the Financial Institution, etc. specified in Article 126-2, paragraph (1), item (ii), the Prime Minister may, following deliberation by the Council, rescind said Specified Confirmation.
(2) The provisions of Article 126-2, paragraphs (3), (7) and (9) shall apply mutatis mutandis to rescission of the Specified Confirmation under the preceding paragraph.
(Submission of Plan Specifying Measures to Enhance Adequacy of Equity Capital or Otherwise Improve the Financial Conditions)
Article 126-21 (1) A Financial Institution, etc. subject to Specified Confirmation pertaining to Specified Measures Under Item (i) shall, when said Financial Institution, etc. and a Financial Institution, etc. which has said Financial Institution, etc. as a Subsidiary, etc. of a Financial Institution, etc. does not make an application prescribed in paragraph (1) or (3) of the following Article, submit a plan to the Prime Minister within the period prescribed in Article 126-2, paragraph (5), setting forth measures to enhance the adequacy of equity capital or otherwise improve the financial conditions by a method other than Subscription for Specified Shares, etc. pertaining to Specified Measures Under Item (i).
(2) When the Prime Minister finds that the plan submitted under the preceding paragraph by a Financial Institution, etc. subject to Specified Confirmation pertaining to Specified Measures Under Item (i) is appropriate, he/she shall, following deliberation by the Council, rescind the Specified Confirmation pertaining to said Financial Institution, etc.
(3) The provisions of Article 126-2, paragraphs (3), (7) and (9) shall apply mutatis mutandis to rescission of the Specified Confirmation under the preceding paragraph.
(4) In the event that a Financial Institution, etc. subject to Specified Confirmation pertaining to Specified Measures Under Item (i) and a Financial Institution, etc. which has said Financial Institution, etc. as a Subsidiary, etc. of a Financial Institution, etc. has not made an application prescribed in paragraph (1) or (3) of the following Article within the period prescribed in Article 126-2, paragraph (5), when said Financial Institution, etc. subject to Specified Confirmation pertaining to Specified Measures Under Item (i) does not submit the plan prescribed in paragraph (1) within said period, the Prime Minister may rescind said Specified Confirmation.
(5) When the Prime Minister finds that the plan submitted by a Financial Institution, etc. under paragraph (1) is not appropriate, he/she may rescind the Specified Confirmation.
(6) When the Prime Minister intends to rescind the Specified Confirmation pertaining to Specified Measures Under Item (i) under the provisions of the preceding two paragraphs, he/she shall hear the opinion of the Minister of Finance in advance.
(7) The provisions of Article 126-2, paragraphs (3), (7) and (9) shall apply mutatis mutandis to rescission of the Specified Confirmation pertaining to Specified Measures Under Item (i) under paragraph (4) or (5).
(Decision for Subscription for Specified Shares, etc.)
Article 126-22 (1) A Financial Institution, etc. subject to Specified Confirmation pertaining to Specified Measures Under Item (i) (excluding a Financial Institution, etc. which has suspended payment of obligations) may apply to the Corporation to execute the Subscription for Specified Shares, etc. (meaning subscription for shares other than preferred shares or the Subscription for Specified Preferred Shares, etc. prescribed in Article 126-28, paragraph (3); the same shall apply hereinafter) of said Financial Institution, etc. to enhance the adequacy of equity capital or otherwise improve the financial conditions of said Financial Institution, etc.
(2) When the Corporation has received an application under the preceding paragraph, the Corporation shall request a decision from the Prime Minister (in the event that the Financial Institution, etc. pertaining to said application is a labor bank, a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc., the Prime Minister and the Minister of Health, Labour and Welfare, and in the event that it is The Shoko Chukin Bank, Ltd. or a Subsidiary, etc. of The Shoko Chukin Bank, the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry) in joint names with said Financial Institution, etc. as to whether or not to execute the Subscription for Specified Shares, etc. pertaining to said application.
(3) A Financial Institution, etc. which has a Financial Institution, etc. subject to Specified Confirmation pertaining to Specified Measures Under Item (i) (excluding a Financial Institution, etc. which has suspended payment of obligations) as a Subsidiary, etc. of a Financial Institution, etc. may apply to the Corporation to execute the Subscription for Specified Shares, etc. of said Financial Institution, etc. to enhance the adequacy of equity capital or otherwise improve the financial conditions of said Subsidiary, etc. of a Financial Institution, etc. subject to Specified Confirmation.
(4) When the Corporation has received an application under the preceding paragraph, the Corporation shall request a decision from the Prime Minister (in the event that the Subsidiary, etc. of a Financial Institution, etc. pertaining to said application is a Subsidiary, etc. of a Labor Bank, etc., the Prime Minister and the Minister of Health, Labour and Welfare, and in the event that it is a Subsidiary, etc. of The Shoko Chukin Bank, the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry) in joint names with the Financial Institution, etc. that has made the application as to whether or not to execute the Subscription for Specified Shares, etc. pertaining to said application.
(5) A Financial Institution, etc. subject to Specified Confirmation pertaining to Specified Measures Under Item (i) that has made an application prescribed in paragraph (1) or a Financial Institution, etc. subject to Specified Confirmation pertaining to Specified Measures Under Item (i) which is a Subsidiary, etc. of a Financial Institution, etc. of the Financial Institution, etc. that has made an application prescribed in paragraph (3) (hereinafter referred to as "Subject Subsidiary, etc." in this Chapter) shall submit to the Prime Minister (in the event that the Financial Institution, etc. pertaining to the application set forth in paragraph (1) or the Subject Subsidiary, etc. pertaining to the application set forth in paragraph (3) is a labor bank, a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc., the Prime Minister and the Minister of Health, Labour and Welfare, and in the event that it is The Shoko Chukin Bank, Ltd. or a Subsidiary, etc. of The Shoko Chukin Bank, the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry; the same shall apply in the following paragraph, Article 105, paragraphs (5) and (6) as applied mutatis mutandis pursuant to paragraph (7), and Article 126-24) a Management Soundness Improvement Plan (meaning a plan to improve the soundness of business management; hereinafter the same shall apply in this Chapter) setting forth measures to streamline the management and to establish a responsible management system (including, in the event that a Financial Institution, etc. has made an application prescribed in paragraph (3), the management system of said Financial Institution, etc.) and other measures specified by Cabinet Order. In this case, the Subject Subsidiary, etc. of the Financial Institution, etc. that is to make an application prescribed in paragraph (3) shall submit said plan in joint names with said Financial Institution, etc.
(6) The Prime Minister shall make a decision to execute the Subscription for Specified Shares, etc. pertaining to Specified Measures Under Item (i) pertaining to an application prescribed in paragraph (1) or (3) only if all of the following requirements are satisfied:
(i) there are no serious difficulties associated with the disposition of the Specified Shares, etc. (meaning Shares, etc., Specified Subordinated Bonds (meaning bonds with a special clause of subordinated contents with regard to the payment of principal and interest, which fall under bonds specified by Cabinet Order as contributing to the adequacy of equity capital or otherwise improving the financial conditions of those other than a Bank, etc., Bank Holding Company, etc. or The Shoko Chukin Bank, Ltd.; the same shall apply hereinafter), equity investments of those other than stock companies and the cooperative structured financial institutions prescribed in Article 2, paragraph (1) of the Preferred Equity Investment Act, or claims pertaining to funds) (including the following in the case of Shares, etc., and including equivalents of the following in the case of Specified Subordinated Bonds, equity investments of those other than stock companies and the cooperative structured financial institutions prescribed in said paragraph, or claims pertaining to funds) or loan claims acquired by the Corporation in connection with the Subscription for Specified Shares, etc. pertaining to Specified Measures Under Item (i);
(a) in the event that the Specified Shares, etc. are shares, the shares specified below:
1. in the event that said shares are those for which a request for Conversion into Shares of Another Class (meaning the delivery of shares of another class in exchange for the acquisition of said shares by their issuing company; hereinafter the same shall apply in this Chapter) can be made, shares of another class into which said shares are converted pursuant to the request;
2. in the event that said shares are convertible upon the occurrence of certain events, shares of another class into which said shares are converted as a result of such occurrence; and
3. shares split or consolidated with respect to said shares or the shares of another class specified in 1 or 2;
(b) in the event that said Specified Shares, etc. are subordinated bonds, shares delivered through the exercise of share options attached to said subordinated bonds and shares split or consolidated with respect thereto; and
(c) in the event that said Specified Shares, etc. are preferred equity investments, preferred equity investments split with respect to said preferred equity investments.
(ii) when a Financial Institution, etc. has made an application prescribed in paragraph (3), the Financial Institution, etc. is not unable to satisfy its obligations in full with its property; and
(iii) the Financial Institution, etc. pertaining to the application set forth in paragraph (1) or the Subject Subsidiary, etc. pertaining to the application set forth in paragraph (3) is expected to implement the following measures through the reliable execution of the Management Soundness Improvement Plan, etc.:
(a) measures to streamline the management;
(b) measures to clarify management responsibilities; and
(c) measures to clarify shareholder responsibilities.
(7) The provisions of Article 105, paragraph (5) shall apply mutatis mutandis to the case of making a decision under the preceding paragraph; the provisions of paragraph (6) of said Article shall apply mutatis mutandis to the case of having made a decision under paragraph (2) or (4), the provisions of paragraph (7) of said Article shall apply mutatis mutandis to the case where a decision is made not to execute Subscription for Specified Shares, etc. pertaining to Specified Measures Under Item (i) pertaining to the application prescribed in paragraph (1) or (3); the provisions of paragraph (8) of said Article shall apply mutatis mutandis to rescission of Specified Confirmation pertaining to Specified Measures Under Item (i) under paragraph (7) of said Article as applied mutatis mutandis pursuant to this paragraph; the provisions of Article 106 shall, in the event that the application prescribed in paragraph (1) or (3) has been made (in the event that an application prescribed in paragraph (1) has been made, limited to applications pertaining to subscription for shares), apply mutatis mutandis to the Financial Institution, etc. that has made the application prescribed in paragraph (1) and has received a decision under the preceding paragraph with regard to said application and that is a stock company, or to the Financial Institution, etc. or its Subject Subsidiary, etc. that has made the application prescribed in paragraph (3) and that is a stock company; the provisions of Article 107 shall apply mutatis mutandis to the case where the Corporation executes Subscription for Specified Shares, etc. in accordance with a decision under the preceding paragraph; the provisions of Article 107-2 shall apply mutatis mutandis to the case where the application prescribed in paragraph (1) or (3) is for subscription for shares or subordinated bonds (limited to those with share options) or Specified Subordinated Bonds (limited to those with share options) and a decision under the preceding paragraph has been made with regard to said application; the provisions of Article 107-3 shall apply mutatis mutandis to shares with restricted voting right prescribed in Article 115 of the Companies Act that have been issued in accordance with a decision under said paragraph by a Financial Institution, etc. subject to Specified Confirmation pertaining to Specified Measures Under Item (i) or a Financial Institution, etc. having said Financial Institution as its Subject Subsidiary, etc.; and the provisions of Article 107-4 shall apply mutatis mutandis to preferred equity investments that have been issued in accordance with a decision under said paragraph by a Financial Institution that is subject to Specified Confirmation pertaining to Specified Measures Under Item (i). In this case, the term "The Shoko Chukin Bank, Ltd." in Article 105, paragraph (5) shall be deemed to be replaced with "The Shoko Chukin Bank, Ltd. or a Subsidiary, etc. of The Shoko Chukin Bank (meaning the Subsidiary, etc. of The Shoko Chukin Bank prescribed in Article 126-2, paragraph (2), item (i); the same shall apply hereinafter)"; the term "the Financial Institution that has made the application prescribed in paragraph (1) or the Bank Holding Company, etc. that has made the application prescribed in paragraph (2)" in paragraph (6) of said Article shall be deemed to be replaced with "the Financial Institution, etc. (meaning the Financial Institution, etc. prescribed in Article 126-2, paragraph (2); the same shall apply hereinafter) that has made the application prescribed in Article 126-22, paragraph (1) or (3)"; the term "the Confirmation pertaining to the Measures Under Item (i) with respect to the Financial Institution that has made the application prescribed in paragraph (1) or the Subject Subsidiary Company of the Bank Holding Company, etc." in paragraph (7) of said Article shall be deemed to be replaced with "the Specified Confirmation (meaning the Specified Confirmation prescribed in Article 126-2, paragraph (1); the same shall apply hereinafter) pertaining to Specified Measures Under Item (i) (meaning the Specified Measures Under Item (i) prescribed in item (i) of said paragraph) with respect to a Subject Subsidiary, etc. (meaning the Subject Subsidiary, etc. prescribed in Article 126-22, paragraph (5); the same shall apply hereinafter"; the term "the Prime Minister shall" in said paragraph shall be deemed to be replaced with "the Prime Minister may"; the term "said subscription for shares be conditioned upon" in Article 106, paragraph (1) shall be deemed to be replaced with "Subscription for Specified Shares, etc. (meaning the Subscription for Specified Shares, etc. prescribed in Article 126-22, paragraph (1); the same shall apply hereinafter) be conditioned upon"; the term "the Prime Minister shall" in paragraph (4) of said Article shall be deemed to be replaced with "the Prime Minister may"; the term "For the purpose of applying the provisions of paragraphs (1) and (3) in the event that a Financial Institution subject to a decision under paragraph (4) of the preceding Article is The Shoko Chukin Bank, Ltd." in paragraph (6) of said Article shall be deemed to be replaced with "For the purpose of applying the provisions of paragraph (1) or (3) in the event that a Financial Institution subject to a decision under paragraph (4) of the preceding Article is a Subsidiary, etc. of a Labor Bank, etc. (meaning the Subsidiary, etc. of a Labor Bank, etc. prescribed in Article 126-2, paragraph (2), item (i); the same shall apply hereinafter), the term 'the Prime Minister' in these provisions shall be deemed to be replaced with 'the Prime Minister and the Minister of Health, Labour and Welfare,' and in the event that it is The Shoko Chukin Bank, Ltd. or a Subsidiary, etc. of The Shoko Chukin Bank"; the term "the issuer of the Shares, etc." in Article 107, paragraph (2) shall be deemed to be replaced with "the issuer of the Specified Shares, etc. (meaning the Specified Shares, etc. prescribed in Article 126-22, paragraph (6), item (i))"; the term "or a federation of labor banks" in said paragraph shall be deemed to be replaced with ", a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc."; the term "The Shoko Chukin Bank, Ltd." in said paragraph shall be deemed to be replaced with "The Shoko Chukin Bank, Ltd. or a Subsidiary, etc. of The Shoko Chukin Bank"; the term "a Bank Holding Company, etc. has made an application prescribed in Article 105, paragraph (2)" in paragraph (3) of said Article shall be deemed to be replaced with "a Financial Institution, etc. has made an application prescribed in Article 126-22, paragraph (3)"; the term "issued by the Bank Holding Company, etc." in said paragraph shall be deemed to be replaced with "with respect to the Financial Institution, etc."; the term "Bank Holding Company, etc. shall" in said paragraph shall be deemed to be replaced with "Financial Institution, etc. (including a Subsidiary, etc. of a Financial Institution, etc. (meaning the Subsidiary, etc. of a Financial Institution, etc. prescribed in Article 126-2, paragraph (5) and excluding a Subject Subsidiary, etc.; hereinafter the same shall apply in this paragraph) with respect to whom said Financial Institution, etc. or its Subsidiary, etc. of a Financial Institution, etc. has executed Subscription for Specified Shares, etc. pursuant to the provisions of this paragraph) shall"; the term "the Subject Subsidiary Company" in said paragraph shall be deemed to be replaced with "the Subject Subsidiary, etc. or the Subsidiary, etc. of a Financial Institution, etc."; the term "the Subscription for Shares, etc." in said paragraph shall be deemed to be replaced with "the Subscription for Specified Shares, etc."; the term "the amount of said subscription for shares" in said paragraph shall be deemed to be replaced with "the amount of said subscription for Specified Shares, etc. of the Financial Institution, etc."; the term "is The Shoko Chukin Bank, Ltd.," in Article 107-2, paragraph (1) shall be deemed to be replaced with "is a Subsidiary, etc. of a Labor Bank, etc., the Prime Minister and the Minister of Health, Labour and Welfare, and in the event that the issuer is The Shoko Chukin Bank, Ltd. or a Subsidiary, etc. of The Shoko Chukin Bank,"; and the term "the Minister of Economy, Trade and Industry" in said paragraph shall be deemed to be replaced with "the Minister of Economy, Trade and Industry"; and any other necessary technical replacement of terms shall be specified by Cabinet Order.
(Special Provisions of the Insurance Business Act Concerning Decision on Subscription for Specified Shares, etc.)
Article 126-23 (1) In the event that a decision under paragraph (6) of the preceding Article has been made, a Mutual Company that is to solicit funds pertaining to said decision may, notwithstanding the provisions of Article 60, paragraph (1) of the Insurance Business Act, decide on the amount of funds to be newly solicited by a resolution of the board of directors meeting and solicit said funds.
(2) In the care prescribed in the preceding paragraph, the Mutual Company that is to solicit the funds set forth in said paragraph may, notwithstanding the provisions of Article 62, paragraph (1) of the Insurance Business Act, amend the articles of incorporation concerning the solicitation of funds by a resolution of the board of directors meeting.
(Publication of Plan Pertaining to Subscription for Specified Shares, etc.)
Article 126-24 (1) The Prime Minister shall, upon making a decision under Article 126-22, paragraph (6), make public the Management Soundness Improvement Plan submitted under paragraph (5) of said Article; provided, however, that this shall not apply to matters of which disclosure is likely to cause disruption in the financial system, divulge any secret of creditors or any other business customers of a Financial Institution, etc. that has submitted the Management Soundness Improvement Plan (including a Financial Institution, etc. and a Subsidiary, etc. of the Financial Institution, etc. that have submitted said Management Soundness Improvement Plan in joint names; hereinafter the same shall apply in this paragraph), or bring undue disadvantage to the conduct of business by said Financial Institution, etc. that has submitted the Management Soundness Improvement Plan.
(2) Until such time when the Corporation makes a disposition or receives redemption or repayment with respect to the whole of Acquired Specified Shares, etc. or Acquired Specified Loan Claims (meaning loan claims acquired by the Corporation pursuant to Subscription for Specified Shares, etc. pertaining to Specified Measures Under Item (i); hereinafter the same shall apply in this Chapter), the Prime Minister may request a Financial Institution, etc. subject to Specified Confirmation pertaining to the Specified Measures Under Item (i) (including a Financial Institution, etc. that has submitted a Management Soundness Improvement Plan under Article 126-22, paragraph (5) in joint names with said Financial Institution, etc.) to report the status of implementation of the Management Soundness Improvement Plan submitted under said paragraph and make such report public.
(3) The term "Acquired Specified Shares, etc." as used in the preceding paragraph means the following:
(i) the Specified Shares, etc. (meaning Shares, etc., Specified Subordinated Bonds, equity investments of those other than stock companies and the cooperative structured financial institutions prescribed in Article 2, paragraph (1) of the Preferred Equity Investment Act, or claims pertaining to funds; the same shall apply in the following item) acquired by the Corporation pursuant to Subscription for Specified Shares, etc. pertaining to Specified Measures Under Item (i) (including the following in the case of Shares, etc., and including equivalents of the following in the case of Specified Subordinated Bonds, equity investments of those other than stock companies and the cooperative structured financial institutions prescribed in said paragraph, or claims pertaining to funds):
(a) in the event that the Specified Shares, etc. are shares, the shares specified below:
1. in the event that said shares are those for which a request for Conversion into Shares of Another Class can be made, shares of another class into which said shares are converted pursuant to the request;
2. in the event that said shares are convertible upon the occurrence of certain events, shares of another class into which said shares are converted as a result of such occurrence; and
3. shares split or consolidated with respect to said shares or the shares of another class specified in 1 or 2;
(b) in the event that said Specified Shares, etc. are subordinated bonds, shares delivered through the exercise of share options attached to said subordinated bonds and shares split or consolidated with respect thereto; and
(c) in the event that said Specified Shares, etc. are preferred equity investments, preferred equity investments split with respect to said preferred equity investments; and
(ii) the shares (including the following) allotted to the Corporation by a company that has become a wholly owning parent stock company in share exchange or wholly owning parent company incorporated through share transfer of a Financial Institution, etc. with respect to whom the Corporation has executed the Subscription for Specified Shares, etc. pertaining to Specified Measures Under Item (i) and other Specified Shares, etc. specified by Cabinet Order:
(a) in the event that said shares are those for which a request for Conversion into Shares of Another Class can be made, shares of another class into which said shares are converted pursuant to the request;
(b) in the event that said shares are convertible upon the occurrence of certain events, shares of another class into which said shares are converted as a result of such occurrence; and
(c) shares split or consolidated with respect to said shares or the shares of another class specified in (a) or (b).
(Authorization for Share Exchange, etc. Pertaining to Specified Measures Under Item (i))
Article 126-25 (1) A Financial Institution, etc. (including a company prescribed in item (i) of the following paragraph in the event that the authorization set forth in this paragraph is given) with respect to which the Corporation has executed the Subscription for Specified Shares, etc. in accordance with a decision under Article 126-22, paragraph (6), which has issued Acquired Specified Shares, etc. (meaning the Acquired Specified Shares, etc. prescribed in paragraph (3) of the preceding Article; hereinafter the same shall apply in this Chapter) actually held by the Corporation (hereinafter referred to as "Issuing Financial Institution, etc." in this Article) shall obtain the authorization of the Prime Minister (in the event that the Issuing Financial Institution, etc. is a Subsidiary, etc. of a Labor Bank, etc., the Prime Minister and the Minister of Health, Labour and Welfare, and in the event that it is a Subsidiary, etc. of The Shoko Chukin Bank, the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry; the same shall apply in the following paragraph) in advance when said Financial Institution, etc. intends to effect a share exchange (limited to those through which the Issuing Financial Institution, etc. becomes a wholly owned subsidiary company in share exchange) or share transfer (hereinafter referred to as "Share Exchange, etc." in this Article).
(2) The Prime Minister shall give the authorization set forth in the preceding paragraph only if all of the following requirements are satisfied:
(i) a company that is to become, through the Share Exchange, etc., a wholly owning parent stock company in share exchange or wholly owning parent company incorporated through share transfer of the Issuing Financial Institution, etc. is a Financial Institution, etc. which has a Financial Institution, etc. as a Subsidiary, etc. of a Financial Institution, etc. (including those that will be newly established);
(ii) the type of Acquired Specified Shares, etc. to be allotted to the Corporation through the Share Exchange, etc. is found to be the same as the type of Acquired Specified Shares, etc. actually held by the Corporation prior to said Share Exchange, etc., and the ratio of voting rights pertaining to Acquired Specified Shares, etc. actually held by the Corporation after said Share Exchange, etc. to voting rights of all shareholders of the company prescribed in the preceding item is not significantly lower than the ratio of voting rights pertaining to Acquired Specified Shares, etc. held by the Corporation prior to said Share Exchange, etc. to voting rights of all shareholders of said Issuing Financial Institution, etc.; and
(iii) there will be no difficulty in making a disposition of shares which are the acquired Shares, etc. following the Share Exchange, etc.
(3) When the Issuing Financial Institution, etc. has executed the Share Exchange, etc. following the authorization set forth in paragraph (1), said Issuing Financial Institution, etc. or a Subsidiary, etc., that is the Subject Subsidiary, etc. (including the Bridge Subsidiary, etc. prescribed in paragraph (4) of the following Article) of the Financial Institution, etc., with respect to which the Corporation has executed the Subscription for Specified Shares, etc. in accordance with a decision under Article 126-22, paragraph (6) (limited to a decision pertaining to the application set forth in paragraph (1) of said Article), or with respect to which the Corporation has executed the Subscription for Specified Shares, etc. in accordance with a decision under Article 126-22, paragraph (6) (limited to a decision pertaining to the application set forth in paragraph (3) of said Article) shall submit to the Prime Minister, in joint names with a company that has become, through said Share Exchange, etc., a wholly owning parent stock company in share exchange or wholly owning parent company incorporated through share transfer of said Issuing Financial Institution, etc., replacing the Management Soundness Improvement Plan (meaning the plan submitted under Article 126-22, paragraph (5), this paragraph, or paragraph (3) of the following Article as applied mutatis mutandis pursuant to the provisions of paragraph (4) of the following Article) that has been implemented, a new Management Soundness Improvement Plan stating, in addition to the measures stated in said Management Soundness Improvement Plan (excluding the part pertaining to the management system of the Financial Institution, etc. in joint names with whom said Management Soundness Improvement Plan was submitted), measures to establish a responsible management system in a company that has become, through the Share Exchange, etc., a wholly owning parent stock company in share exchange or wholly owning parent company incorporated through share transfer of said Issuing Financial Institution, etc., and other measures specified by Cabinet Order (in the event that the Financial Institution, etc. submitting the Management Soundness Improvement Plan is a Subsidiary, etc. of a Labor Bank, etc., the Management Soundness Improvement Plan shall be submitted to the Prime Minister and the Minister of Health, Labour and Welfare, and in the event that it is a Subsidiary, etc. of The Shoko Chukin Bank, the Management Soundness Improvement Plan shall be submitted to the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry; the same shall apply in the following paragraph).
(4) The provisions of the preceding Article shall apply mutatis mutandis to the Management Soundness Improvement Plan submitted to the Prime Minister under the preceding paragraph. In this case, the term "Financial Institution, etc. ... (... that has submitted a Management Soundness Improvement Plan under Article 126-22, paragraph (5)" in paragraph (2) of the preceding Article shall be deemed to be replaced with "Financial Institution, etc. ... that has submitted a Management Soundness Improvement Plan under paragraph (3) of the following paragraph (... that has submitted said Management Soundness Improvement Plan.", and any other necessary technical replacement of terms shall be specified by Cabinet Order.
(Authorization for Corporate Reorganization Pertaining to Specified Measures Under Item (i))
Article 126-26 (1) A Financial Institution, etc. (including a Bridge Financial Institution, etc. prescribed in item (i) of the following paragraph in the event that the authorization set forth in this paragraph is given) with respect to which the Corporation has executed the Subscription for Specified Shares, etc. in accordance with a decision under Article 126-22, paragraph (6) (limited to a decision pertaining to the application set forth in paragraph (1) of said Article), and which is an issuer of Acquired Specified Shares, etc. or obligor of Acquired Specified Loan Claims actually held by the Corporation (hereinafter referred to as "Subject Financial Institution, etc." in this Article) shall, when such Financial Institution, etc. intends to implement a merger, company split, takeover of all or part of rights and obligations concerning business through a company split, or Business Transfer, etc. (hereinafter referred to as "Corporate Reorganization" in this Article), obtain the authorization of the Prime Minister (in the event that the Subject Financial Institution, etc. is a labor bank, a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc., the Prime Minister and the Minister of Health, Labour and Welfare, and in the event that it is The Shoko Chukin Bank, Ltd. or a Subsidiary, etc. of The Shoko Chukin Bank, the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry; the same shall apply in the following paragraph) in advance.
(2) The Prime Minister shall give the authorization set forth in the preceding paragraph only if all of the following requirements are satisfied:
(i) a corporation that is to become an issuer of Acquired Specified Shares, etc. or obligor of Acquired Specified Loan Claims held by the Corporation after the Corporate Reorganization is the Subject Financial Institution, etc. or is another Financial Institution, etc. (including those that will be newly established; hereinafter referred to as "Bridge Financial Institution, etc." in this Article) that succeeds to the whole of the business pertaining to said Management Soundness Improvement Plan (meaning the plan submitted under Article 126-22, paragraph (5) or the following paragraph) that has been implemented by said Subject Financial Institution, etc. (hereinafter referred to as "Management Soundness Improvement Operations" in this paragraph);
(ii) the management soundness improvement of the Subject Financial Institution, etc. (including the Bridge Financial Institution, etc.) is not hindered as a result of the Corporate Reorganization;
(iii) it can be expected with certainty that, when the Management Soundness Improvement Operations are to be succeeded, such succession will be conducted smoothly and appropriately;
(iv) there will be no difficulty in making a disposition or receiving redemption or repayment with respect to said Acquired Specified Shares, etc. or Acquired Specified Loan Claims following the Corporate Reorganization; and
(v) other requirements specified by Cabinet Order.
(3) In the event that the Subject Financial Institution, etc. has conducted the Corporate Reorganization following the authorization set forth in paragraph (1), when there is any Bridge Financial Institution, etc. pertaining to said Corporate Reorganization, said Bridge Financial Institution, etc. shall submit a Management Soundness Improvement Plan, setting forth measures to streamline the management, measures to establish a responsible management system, and other measures specified by Cabinet Order, to the Prime Minister (in the event that said Bridge Financial Institution, etc. is a labor bank, a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc., the Prime Minister and the Minister of Health, Labour and Welfare, and in the event that it is The Shoko Chukin Bank, Ltd. or a Subsidiary, etc. of The Shoko Chukin Bank, the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry).
(4) The provisions of the preceding three paragraphs shall apply mutatis mutandis to the Subject Subsidiary, etc. of the Financial Institution, etc. with respect to which the Corporation has executed the Subscription for Specified Shares, etc. in accordance with a decision under Article 126-22, paragraph (6) (limited to a decision pertaining to the application set forth in paragraph (3) of said Article) or the Financial Institution, etc. (including the Bridge Financial Institution, etc.) with respect to which the Corporation has executed the Subscription for Specified Shares, etc. in accordance with a decision under paragraph (6) of said Article (limited to a decision pertaining to an application under paragraph (1) of said Article) that has ceased to be a Subject Financial Institution, etc. as a result of said share exchange or share transfer effected by said Financial Institution, etc. (including a Bridge Subsidiary, etc. (meaning another Financial Institution, etc. as prescribed in paragraph (2), item (i) as applied mutatis mutandis pursuant to this paragraph; hereinafter the same shall apply in this Article); hereinafter referred to as "Specified Subject Subsidiary, etc." in this Article) that has been implementing a Management Soundness Improvement Plan (meaning a plan submitted under Article 126-22, paragraph (5), paragraph (3) of the preceding Article (including the cases where it is applied mutatis mutandis pursuant to paragraph (8)), the preceding paragraph as applied mutatis mutandis pursuant to this paragraph, or paragraph (7)). In this case, the term "merger" in paragraph (1) shall be deemed to be replaced with "until such time that the Corporation has made a disposition or received redemption or repayment with respect to the whole of Acquired Specified Shares, etc. or Acquired Specified Loan Claims pertaining to the Financial Institution, etc. that has executed the Subscription for Specified Shares, etc. in accordance with a decision under Article 126-22, paragraph (6) pertaining to said Management Soundness Improvement Plan, merger"; the term "the Subject Financial Institution, etc. is a labor bank, a federation of labor banks, or" in said paragraph shall be deemed to be replaced with "a Specified Subject Subsidiary, etc. (meaning the Specified Subject Subsidiary, etc. prescribed in paragraph (4); the same shall apply in the following paragraph and paragraph (3)) which has been implementing a Management Soundness Improvement Plan is"; the term "A corporation that is to become an issuer of Acquired Specified Shares, etc. or obligor of Acquired Specified Loan Claims held by the Corporation after the Corporate Reorganization is the Subject Financial Institution, etc. or is another Financial Institution, etc. (including those that will be newly established; hereinafter referred to as 'Bridge Financial Institution, etc.' in this Article) that succeeds to the whole of the business pertaining to said Management Soundness Improvement Plan (meaning the plan submitted under Article 126-22, paragraph (5) or the following paragraph) that has been implemented by said Subject Financial Institution, etc." in paragraph (2), item (i) shall be deemed to be replaced with "A Financial Institution, etc. that has submitted said Management Soundness Improvement Plan in joint names with said Specified Subject Subsidiary, etc. is a Financial Institution, etc. which has, as a Financial Institution Subsidiary, etc. said Specified Subject Subsidiary, etc. or another Financial Institution, etc. (including those that will be newly established; hereinafter referred to as 'Bridge Financial Institution, etc.' in this Article) that succeeds to the whole of the business pertaining to said Management Soundness Improvement Plan after the Corporate Reorganization"; the term "the Subject Financial Institution, etc. (including the Bridge Financial Institution, etc.)" in item (ii) of said paragraph shall be deemed to be replaced with "a Specified Subject Subsidiary, etc. that has been implementing a Management Soundness Improvement Plan (including the Bridge Subsidiary, etc.)"; and the term "setting forth measures to achieve the rationalization of management" in the preceding paragraph shall be deemed to be replaced with "in joint names with the Financial Institution, etc. in joint names with whom the Management Soundness Improvement Plan set forth in item (i) of the preceding paragraph was submitted, setting forth measures to achieve the rationalization of management"; and any other necessary technical replacement of terms shall be specified by Cabinet Order.
(5) A Specified Financial Institution, etc. (meaning the Financial Institution, etc. set forth in paragraph (1) of the preceding Article which is an issuer of Acquired Specified Shares, etc. or obligor of Acquired Specified Loan Claims actually held by the Corporation, and including another Financial Institution, etc. as prescribed in item (i) of the following paragraph in the event that the authorization set forth in this paragraph is given or the company prescribed in paragraph (2), item (i) of the preceding Article as applied mutatis mutandis in paragraph (8) in the event that the authorization set forth in paragraph (1) of the preceding Article as applied mutatis mutandis in paragraph (8) is given which is an issuer of Acquired Specified Shares, etc. or obligor of Acquired Specified Loan Claims actually held by the Corporation (hereinafter referred to as a "Financial Institution, etc. after Corporate Reorganization" in this Article); the same shall apply in the following paragraph ) other than a Subject Financial Institution, etc. shall, when such Specified Financial Institution, etc. intends to conduct Corporate Reorganization, obtain the authorization of the Prime Minister (in the event that said Specified Financial Institution, etc. is a labor bank, a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc., the Prime Minister and the Minister of Health, Labour and Welfare, and in the event that it is The Shoko Chukin Bank, Ltd. or a Subsidiary, etc. of The Shoko Chukin Bank, the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry; the same shall apply in the following paragraph) in advance.
(6) The Prime Minister shall give the authorization set forth in the preceding paragraph only if all of the following requirements are satisfied:
(i) a corporation that is to become an issuer of Acquired Specified Shares, etc. or obligor of Acquired Specified Loan Claims held by the Corporation after the Corporate Reorganization is the Specified Financial Institution, etc. or is another Financial Institution, etc. (including those that will be newly established) which has the Subject Subsidiary, etc. pertaining to said Specified Financial Institutions, etc. as a Subsidiary, etc. of a Financial Institution, etc.;
(ii) the business management by the Specified Financial Institution, etc. (including another Financial Institution, etc. prescribed in the preceding item) of the Subject Subsidiary, etc. pertaining to said Specified Financial Institution, etc. is not hindered as a result of the Corporate Reorganization;
(iii) there will be no difficulty in making a disposition or receiving redemption or repayment with respect to said Acquired Specified Shares, etc. or Acquired Specified Loan Claims following the Corporate Reorganization; and
(iv) other requirements specified by Cabinet Order.
(7) In the event that a Specified Financial Institution, etc. (meaning the Financial Institution, etc. set forth in paragraph (1) of the preceding Article which is an issuer of Acquired Specified Shares, etc. or obligor of Acquired Specified Loan Claims actually held by the Corporation) other than the Subject Financial Institution, etc. or the Financial Institution, etc. after Corporate Reorganization has conducted Corporate Reorganization following the authorization set forth in paragraph (5), if there is another Financial Institution, etc. prescribed in item (i) of the preceding paragraph, said Specified Financial Institution, etc. or the Specified Subject Subsidiary, etc. pertaining to the Financial Institution, etc. after Corporate Reorganization shall submit to the Prime Minister (in the event that said Specified Subject Subsidiary, etc. is a Subsidiary, etc. of a Labor Bank, etc., the Prime Minister and the Minister of Health, Labour and Welfare, and in the event that it is a Subsidiary, etc. of The Shoko Chukin Bank, the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry), in joint names with said other Financial Institution, etc., a new Management Soundness Improvement Plan to replace the Management Soundness Improvement Plan that has been implemented (meaning the Management Soundness Improvement Plan prescribed in paragraph (4)), stating, in addition to the measures stated in said Management Soundness Improvement Plan (excluding the part pertaining to the management system of the Financial Institution, etc. in joint names with whom said Management Soundness Improvement Plan was submitted), measures to establish a responsible management system in said other Financial Institution, etc., and other measures specified by Cabinet Order.
(8) The provisions of Article 126-24, paragraph (1) shall apply mutatis mutandis to the Management Soundness Improvement Plans submitted to the Prime Minister (in the event that the Financial Institution, etc. that has submitted the Management Soundness Improvement Plan is a labor bank, a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc., the Prime Minister and the Minister of Health, Labour and Welfare, and in the event that it is The Shoko Chukin Bank, Ltd. or a Subsidiary, etc. of The Shoko Chukin Bank, the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry) under paragraph (3) (including the cases where it is applied mutatis mutandis pursuant to paragraph (4)) or the preceding paragraph, the provisions of Article 126-24, paragraph (2) shall apply mutatis mutandis to the Financial Institution, etc. (including the Financial Institution, etc. in joint names with whom these Management Soundness Improvement Plans have been submitted) that has submitted these Management Soundness Improvement Plans, and the provisions of the preceding Article shall apply mutatis mutandis to a Bridge Financial Institution, etc. that is an issuer of Acquired Specified Shares, etc. actually held by the Corporation or the Financial Institution, etc. after Corporate Reorganization that is an issuer of Acquired Specified Shares, etc. actually held by the Corporation. In this case, the terms "the Subject Subsidiary, etc. (including the Bridge Subsidiary, etc. prescribed in paragraph (4) of the following Article) of the Financial Institution, etc. with respect to which the Corporation has executed the Subscription for Specified Shares, etc. in accordance with a decision under Article 126-22, paragraph (6) (limited to a decision pertaining to the application set forth in paragraph (1) of said Article), or with respect to which the Corporation has executed the Subscription for Specified Shares, etc. in accordance with a decision under Article 126-22, paragraph (6) (limited to a decision pertaining to the application set forth in paragraph (3) of said Article)" in Article 126-22, paragraph (3) shall be deemed to be replaced with "the Specified Subject Subsidiary, etc. prescribed in paragraph (4) of the following Article," and any other necessary technical replacement of terms shall be specified by Cabinet Order.
(Disposition of Acquired Specified Shares, etc. or Acquired Specified Loan Claims)
Article 126-27 (1) The Corporation shall, if it intends to transfer or make any other disposition of Acquired Specified Shares, etc. or Acquired Specified Loan Claims, obtain approval from the Prime Minister and the Minister of Finance (in the event that an issuer of said Acquired Specified Shares, etc. or obligor of Acquired Specified Loan Claims is a labor bank, a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc., from the Prime Minister, the Minister of Finance, and the Minister of Health, Labour and Welfare, and in the event that an issuer of said Acquired Specified Shares, etc. or obligor of Acquired Specified Loan Claims is The Shoko Chukin Bank, Ltd. or a Subsidiary, etc. of The Shoko Chukin Bank, from the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry; the same shall apply in the following paragraph).
(2) Upon making a disposition prescribed in the preceding paragraph, the Corporation shall promptly report the details thereof to the Prime Minister and the Minister of Finance.
(Application for Specified Financial Assistance)
Article 126-28 (1) A Financial Institution, etc. undertaking a Specified Merger, etc. that is not a Financial Institution, etc. subject to Specified Confirmation pertaining to Specified Measures Under Item (ii) (such Financial Institution, etc. subject to Specified Confirmation shall be hereinafter referred to as a "Specified Failed Financial Institution, etc.," and such Financial Institution, etc. undertaking a Specified Merger, etc. shall be hereinafter referred to as a "Specified Assuming Financial Institution, etc.") or a Specified Holding Company, etc. (meaning a Bank Holding Company, etc., an Insurance Holding Company, etc. prescribed in Article 241, paragraph (2) of the Insurance Business Act (excluding those set forth in items (ii) and (iv) of said paragraph) or a Designated Parent Company; the same shall apply hereinafter) undertaking a Specified Merger, etc. that is not a Specified Failed Financial Institution, etc. (hereinafter referred to as a "Specified Assuming Holding Company, etc.") may apply to have the Corporation take the following measures to support the Specified Merger, etc. (hereinafter referred to as "Specified Financial Assistance"):
(i) donation of money;
(ii) loan or deposit of funds;
(iii) purchase of assets;
(iv) guarantee of obligations;
(v) assumption of obligations;
(vi) Subscription for Specified Preferred Shares, etc.; and
(vii) Securing of Damage.
(2) The term "Specified Merger, etc." as used in the preceding paragraph means the following:
(i) a merger in which a Financial Institution, etc. that merges with a Specified Failed Financial Institution, etc. survives;
(ii) a merger in which a Financial Institution, etc. is established through the merger of a Specified Failed Financial Institution, etc. and another Financial Institution, etc.;
(iii) a Business Transfer, etc. in which a Specified Failed Financial Institution, etc. transfers its business to another Financial Institution, etc.;
(iv) assumption of all or part of obligations of a Specified Failed Financial Institution, etc. by another Financial Institution, etc. (excluding those associated with a Business Transfer, etc.; hereinafter referred to as "Specified Assumption of Obligations");
(v) an acquisition of shares of a Specified Failed Financial Institution, etc. that is a stock company by another Financial Institution, etc. or Specified Holding Company, etc. to implement matters specified by the Prime Minister and the Minister of Finance as being necessary for ensuring sound and appropriate operation of said Specified Failed Financial Institution, etc.;
(vi) an absorption-type company split to which a Specified Failed Financial Institution, etc. is a party where another Financial Institution, etc. succeeds to all or part of the rights and obligations held by the Specified Failed Financial Institution, etc. in relation to its business through said absorption-type company split; and
(vii) an incorporation-type company split to which a Specified Failed Financial Institution, etc. is a party where the Financial Institution, etc. newly established through said incorporation-type company split succeeds to all or part of the rights and obligations held by the Specified Failed Financial Institution, etc. in relation to its business through said incorporation-type company split.
(3) The term "Subscription for Specified Preferred Shares, etc." as used in paragraph (1), item (vi) means Subscription for Preferred Shares, etc., subscription for Specified Subordinated Bonds, loans for consumption made pursuant to Specified Subordinated Loan Agreements (meaning loans for consumption falling under those with a special clause of subordinated contents with regard to the payment of principal and interest, and which are specified by Cabinet Order as contributing to the adequacy of equity capital or otherwise improving the financial conditions of those other than a Financial Institution or Bank Holding Company, etc.), subscription for equity investments of those other than stock companies and the cooperative structured financial institutions prescribed in Article 2, paragraph (1) of the Preferred Equity Investment Act, or contribution of funds.
(4) The Specified Financial Assistance provided to support a merger specified in paragraph (2), item (ii) or an incorporation-type company split specified in item (vii) of said paragraph shall be provided to the Specified Assuming Financial Institution, etc. or Financial Institution, etc. that will be established by the merger or the incorporation-type company split, and if there are two or more Specified Assuming Financial Institutions, etc. involved in the merger or the incorporation-type company split, the application prescribed in paragraph (1) shall be made in the joint names of said Specified Assuming Financial Institutions, etc.
(5) The purchase of assets specified in paragraph (1), item (iii) shall be conducted with respect to the assets of a Specified Failed Financial Institution, etc. pertaining to a Specified Merger, etc. (meaning the Specified Merger, etc. prescribed in paragraph (2); the same shall apply hereinafter) or assets specified in each of the following items according to the category of Specified Merger, etc. specified in such item, and if the Specified Financial Assistance pertaining to the application prescribed in paragraph (1) includes the purchase of assets of a Specified Failed Financial Institution, etc. pertaining to a Specified Merger, etc., the Specified Assuming Financial Institution, etc. or Specified Assuming Holding Company, etc. pertaining to the Specified Merger, etc. shall apply to the Corporation in joint names with said Specified Failed Financial Institution, etc. for the Corporation to purchase said assets:
(i) a merger specified in paragraph (2), item (i): the assets of the Financial Institution, etc. surviving through the merger (limited to those that were the assets of the Specified Failed Financial Institution, etc. prior to the merger);
(ii) a merger specified in paragraph (2), item (ii): the assets of the Financial Institution, etc. that will be established by the merger (limited to those that were the assets of the Specified Failed Financial Institution, etc. prior to the merger);
(iii) a Business Transfer, etc. specified in paragraph (2), item (iii): the assets of another Financial Institution, etc. prescribed in said item that have been received through said Business Transfer, etc.;
(iv) the acquisition of shares specified in paragraph (2), item (v): the assets of a Financial Institution, etc. whose shares have been so acquired;
(v) the absorption-type company split specified in paragraph (2), item (vi): the assets of another Financial Institution, etc. set forth in said item which said Financial Institution, etc. has succeeded to through the absorption-type company split; and
(vi) the incorporation-type company split specified in paragraph (2), item (vii): the assets of the Financial Institution, etc. established through the incorporation-type company split (limited to those that were assets of the Specified Failed Financial Institution, etc. prior to the incorporation-type company split).
(6) The Securing of Damage specified in paragraph (1), item (vii) shall be performed with respect to the loan claims that are the assets prescribed in each of the preceding items according to the category of Specified Merger, etc. specified in such item.
(7) A Financial Institution, etc. or Specified Holding Company, etc. that has made an application under paragraph (1) or (5) shall promptly report to that effect to the Prime Minister (in the case of a labor bank, a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc., to the Prime Minister and the Minister of Health, Labour and Welfare, and in the case of The Shoko Chukin Bank, Ltd. or a Subsidiary, etc. of The Shoko Chukin Bank, to the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry).
(8) Upon receiving an application under paragraph (1) or (5), the Corporation shall promptly report to that effect to the Minister of Finance; provided, however, that this shall not apply to cases where the Financial Institution, etc. that has made said application is The Shoko Chukin Bank, Ltd. or a Subsidiary, etc. of The Shoko Chukin Bank.
(9) In the event that a resolution by the Policy Board prescribed in Article 64, paragraph (1) as applied mutatis mutandis pursuant to Article 126-31 is to be deliberated with respect to Specified Financial Assistance pertaining to the application prescribed in paragraph (1) or (5) or Article 59-2, paragraph (1) or Article 60, paragraph (1) as applied mutatis mutandis pursuant to Article 126-31, the Policy Board may, when it finds that, in light of the financial conditions of the Specified Failed Financial Institution, etc., the Specified Financial Assistance does not exceed the scope necessary to carry out the Specified Merger, etc. pertaining to said Specified Financial Assistance, adopt a resolution to provide the Specified Financial Assistance.
(Specified Authorization of Eligibility)
Article 126-29 (1) With regard to a Specified Merger, etc. pertaining to an application prescribed in paragraph (1) of the preceding Article or Article 59-2, paragraph (1) or Article 60, paragraph (1) as applied mutatis mutandis pursuant to Article 126-31, a Specified Failed Financial Institution, etc. and Specified Assuming Financial Institution, etc. or Specified Failed Financial Institution, etc. and Specified Assuming Holding Company, etc. pertaining to said Specified Merger, etc. shall obtain the authorization of the Prime Minister by the time the application under these provisions is made.
(2) An application for the authorization under the preceding paragraph shall be made in the joint names of the Specified Failed Financial Institution, etc. and Specified Assuming Financial Institution, etc. or Specified Failed Financial Institution, etc. and Specified Assuming Holding Company, etc. prescribed in the preceding paragraph.
(3) The Prime Minister may not grant authorization under paragraph (1) unless all of the following requirements are satisfied:
(i) the Specified Merger, etc. contributes to the orderly resolution of assets and liabilities of the Specified Failed Financial Institution, etc. pertaining to said Specified Merger, etc.;
(ii) the Specified Financial Assistance by the Corporation is indispensable for carrying out the Specified Merger, etc.; and
(iii) if the Specified Merger, etc. is not carried out for a Specified Assuming Financial Institution, etc., or a Specified Assuming Holding Company, etc. pertaining thereto or with regard to the business or obligations which are to be succeeded to or assumed through the Specified Merger, etc. from the Specified Failed Financial Institution, etc. pertaining to the Specified Merger, etc. (in the event that the Specified Merger, etc. is the acquisition of shares prescribed in paragraph (2), item (v) of the preceding Article, the business or obligations of the Specified Failed Financial Institution, etc. pertaining to the Specified Merger, etc.), and such Specified Failed Financial Institution, etc. abolishes all its businesses or is dissolved, severe disruption is likely to be caused in the financial system in Japan by the abolition of business or default of obligations.
(4) The Prime Minister shall, when granting authorization under paragraph (1) to a labor bank, a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc., obtain consent from the Minister of Health, Labour and Welfare, and when granting authorization under paragraph (1) to The Shoko Chukin Bank, Ltd. or a Subsidiary, etc. of The Shoko Chukin Bank, obtain consent from the Minister of Finance and the Minister of Economy, Trade and Industry.
(5) The Prime Minister shall, when granting authorization under paragraph (1), make clear which Financial Institution, etc. pertaining to said authorization is a Specified Failed Financial Institution, etc.
(6) Upon granting the authorization under paragraph (1), the Prime Minister shall notify the Corporation to that effect.
(7) Upon receiving notice under the preceding paragraph, the Corporation shall promptly report to that effect to the Minister of Finance.
(8) In the event that a company seeking to acquire the shares of a Specified Failed Financial Institution, etc. will become a Holding Company which has a bank as its subsidiary company prescribed in Article 52-17, paragraph (1) of the Banking Act, a Holding Company which has a long-term credit bank as its subsidiary company prescribed in Article 16-2-4, paragraph (1) of the Long-Term Credit Bank Act, or a Holding Company which has an insurance company as its subsidiary company prescribed in Article 271-18, paragraph (1) of the Insurance Business Act through said acquisition of shares, the Prime Minister may not grant authorization under paragraph (1) until after he/she has granted the authorization set forth in Article 52-17, paragraph (1) of the Banking Act, Article 16-2-4, paragraph (1) of the Long-Term Credit Bank Act, or Article 271-18, paragraph (1) of the Insurance Business Act to said company.
(Mediation of Specified Merger, etc.)
Article 126-30 Even in cases where no application is being made under paragraph (2) of the preceding Article, if the Prime Minister finds that the business or obligations of a Specified Failed Financial Institution, etc. satisfies the requirements specified in paragraph (3), item (iii) of the preceding Article, he/she may provide mediation in writing with regard to the Specified Merger, etc. (excluding the merger specified in Article 126-28, paragraph (2), item (ii) and limited to those that contribute to the orderly resolution of assets and liabilities of the Specified Failed Financial Institution, etc. pertaining to said Specified Merger, etc. and for which the Specified Financial Assistance by the Corporation is indispensable) between said Specified Failed Financial Institution, etc. and another Financial Institution, etc. or said Specified Failed Financial Institution, etc. and a Specified Holding Company, etc.
(Application Mutatis Mutandis of Provisions Concerning Financial Assistance)
Article 126-31 The provisions of Article 59-2 shall apply mutatis mutandis to a Specified Assuming Financial Institution, etc. undertaking a Specified Merger, etc. (limited to the Business Transfer, etc. specified in Article 126-28, paragraph (2), item (iii) whereby a Specified Failed Financial Institution, etc. transfers part of its business to another Financial Institution, etc., the Specified Assumption of Obligations, the absorption-type company split specified in item (vi) of said paragraph where another Financial Institution, etc. succeeds to part of the rights and obligations held by the Specified Failed Financial Institution, etc. in relation to its business, or the incorporation-type company split specified in item (vii) of said paragraph where the newly established Financial Institution, etc. succeeds to part of the rights and obligations held by the Specified Failed Financial Institution, etc. in relation to its business; the provisions of Article 60 shall apply mutatis mutandis to a Financial Institution, etc. designated by the Prime Minister of which Specified Merger, etc. is to be supported; the provisions of Article 62 (excluding paragraph (1)) shall apply mutatis mutandis to the mediation set forth in the preceding Article; the provisions of Article 64 (excluding paragraph (2)) shall apply mutatis mutandis to an application under Article 126-28, paragraph (1) or (5) or under Article 59-2, paragraph (1) or Article 60, paragraph (1) as applied mutatis mutandis pursuant to this Article; the provisions of Article 64-2 shall apply mutatis mutandis to an application under Article 126-28, paragraph (1); the provisions of Articles 65 and 66 shall apply mutatis mutandis to a Financial Institution, etc. or Specified Holding Company, etc. which has received the authorization set forth in Article 126-29, paragraph (1) or the mediation set forth in the preceding Article (hereinafter referred to as " Specified Authorization of Eligibility, etc."); the provisions of Article 67 shall apply mutatis mutandis to a Specified Assuming Financial Institution, etc. which has received Specified Authorization of Eligibility, etc.; the provisions of Article 68 shall apply mutatis mutandis to the Specified Financial Assistance provided by the Corporation for a Specified Merger, etc. pertaining to Specified Authorization of Eligibility, etc.; the provisions of Articles 68-2 and 68-3 shall apply mutatis mutandis to a Specified Assuming Financial Institution, etc. or Specified Assuming Holding Company, etc. (including a company prescribed in Article 68-2, paragraph (2) as applied mutatis mutandis pursuant to this Article in the event that the authorization set forth in Article 68-2, paragraph (1) as applied mutatis mutandis pursuant to this Article is given, and a Bridge Financial Institution, etc. prescribed in Article 68-3, paragraph (4) as applied mutatis mutandis pursuant to this Article in the event that the authorization set forth in Article 68-3, paragraph (1) as applied mutatis mutandis pursuant to this Article is given) with respect to which the Corporation has executed the Subscription for Specified Preferred Shares, etc. (meaning the Subscription for Specified Preferred Shares, etc. prescribed in Article 126-28, paragraph (3); the same shall apply hereinafter)). In this case, the term "equity between creditors of the Failed Financial Institution" in Article 59-2, paragraph (1) shall be deemed to be replaced with "equity between creditors and any other interested persons of the Specified Failed Financial Institution, etc. (meaning the Specified Failed Financial Institution, etc. prescribed in Article 126-28, paragraph (1); the same shall apply hereinafter)"; the term "paragraph (6) of the preceding Article" in paragraph (3) of said Article shall be deemed to be replaced with "Article 126-28, paragraph (7)"; the term "Failed Financial Institution that have made an application under the provisions of the preceding two paragraphs, and the provisions of paragraph (7)" in said paragraph shall be deemed to be replaced with "Specified Failed Financial Institution, etc. that have made an application under the provisions of the preceding two paragraphs, and the provisions of paragraph (8)"; the term "a Financial Institution pertaining to the merger, etc. (excluding the Failed Financial Institution) or to a Bank Holding Company, etc. pertaining to the merger, etc." in Article 60, paragraph (1) shall be deemed to be replaced with "a Financial Institution, etc. prescribed in Article 126-2, paragraph (2) pertaining to the Specified Merger, etc. (meaning the Specified Merger, etc. prescribed in Article 126-28, paragraph (2); the same shall apply hereinafter) (such Financial Institution, etc. shall exclude the Specified Failed Financial Institution, etc.) or to a Specified Holding Company, etc. prescribed in Article 126-28, paragraph (1) pertaining to the Specified Merger, etc. (excluding the Specified Failed Financial Institution, etc.)"; the term "Financial Institution" in paragraph (2) of said Article shall be deemed to be replaced with "Financial Institution, etc. (meaning the Financial Institution, etc. prescribed in Article 126-2, paragraph (2); the same shall apply hereinafter)"; the term "Bank Holding Company, etc." in Article 62, paragraph (2) shall be deemed to be replaced with "Specified Holding Company, etc. (meaning the Specified Holding Company, etc. prescribed in Article 126-28, paragraph (1); the same shall apply hereinafter)"; the term "paragraphs (4) to (7) of the preceding Article" in paragraph (4) of said Article shall be deemed to be replaced with "Article 126-29, paragraphs (4), (6), and (7)"; the term "Financial Assistance" in Article 64, paragraph (1) shall be deemed to be replaced with "Specified Financial Assistance (meaning the Specified Financial Assistance prescribed in Article 126-28, paragraph (1); the same shall apply hereinafter)"; the term "or federation of labor banks" in paragraph (3) of said Article shall be deemed to be replaced with ", a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc. (meaning the Subsidiary, etc. of a Labor Bank, etc. prescribed in Article 126-2, paragraph (2), item (i); the same shall apply hereinafter)"; the term "The Shoko Chukin Bank, Ltd." in said paragraph shall be deemed to be replaced with "The Shoko Chukin Bank, Ltd or a Subsidiary, etc. of The Shoko Chukin Bank (meaning the Subsidiary, etc. of The Shoko Chukin Bank prescribed in said item; the same shall apply hereinafter)"; the term "Subscription for Preferred Shares, etc." in Article 64-2, paragraph (1) shall be deemed to be replaced with "Subscription for Specified Preferred Shares, etc. (meaning the Subscription for Specified Preferred Shares, etc. prescribed in Article 126-28, paragraph (3); the same shall apply hereinafter"; the term "Assuming Financial Institution or Assuming Bank Holding Company, etc. (excluding the companies specified in Article 2, paragraph (5), item (v)" in said paragraph shall be deemed to be replaced with "Specified Assuming Financial Institution, etc. (meaning the Specified Assuming Financial Institution, etc. prescribed in paragraph (1) of said Article; the same shall apply hereinafter) or Specified Assuming Holding Company, etc. (meaning the Specified Assuming Holding Company, etc. prescribed in said paragraph"; the term "adequacy of equity capital" in paragraph (2) of said Article shall be deemed to be replaced with "adequacy of equity capital or otherwise improve the financial conditions"; the term "or federation of labor banks" in paragraph (3) of said Article shall be deemed to be replaced with ", a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc."; the term "The Shoko Chukin Bank, Ltd." in said paragraph shall be deemed to be replaced with "The Shoko Chukin Bank, Ltd or a Subsidiary, etc. of The Shoko Chukin Bank"; the term "Acquired Preferred Shares, etc. or Acquired Loan Claims" in paragraph (5) of said Article shall be deemed to be replaced with "Acquired Specified Preferred Shares, etc. or Acquired Specified Loan Claims"; the term "Subscription for Preferred Shares, etc." in said paragraph shall be deemed to be replaced with "Subscription for Specified Preferred Shares, etc."; the term "Acquired Preferred Shares, etc." in paragraph (6) of said Article shall be deemed to be replaced with "Acquired Specified Preferred Shares, etc."; the term "Subscription for Preferred Shares, etc." in item (i) of said paragraph shall be deemed to be replaced with "Subscription for Specified Preferred Shares, etc."; the term "Preferred Shares, etc. (including the following) and other Shares, etc. specified by Cabinet Order" in said item shall be deemed to be replaced with "Specified Preferred Shares, etc. (meaning Preferred Shares, etc., Specified Subordinated Bonds prescribed in Article 126-22, paragraph (6), item (i), equity investments of those other than stock companies and the cooperative structured financial institutions prescribed in Article 2, paragraph (1) of the Preferred Equity Investment Act, or claims pertaining to funds) (including the following in the case of Preferred Shares, etc., and including equivalents of the following in the case of Specified Subordinated Bonds prescribed in said item, equity investments of those other than stock companies and the cooperative structured financial institutions prescribed in Article 2, paragraph (1) of the Preferred Equity Investment Act, or claims pertaining to funds)"; the term "or federation of labor banks" in Article 65 shall be deemed to be replaced with ", a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc."; the term "The Shoko Chukin Bank, Ltd." in said Article shall be deemed to be replaced with "The Shoko Chukin Bank, Ltd or a Subsidiary, etc. of The Shoko Chukin Bank"; the term "a merger, Business Transfer, etc., Transfer of Insured Deposits" in Article 66, paragraph (1) shall be deemed to be replaced with "a merger, Business Transfer, etc., Specified Assumption of Obligations (meaning the Specified Assumption of Obligations prescribed in Article 126-28, paragraph (2), item (iv); the same shall apply hereinafter)"; the term "a merger, Business Transfer, etc., Transfer of Insured Deposits" in said paragraph shall be deemed to be replaced with "a merger, Business Transfer, etc., Specified Assumption of Obligations"; the term "or federation of labor banks" in said paragraph shall be deemed to be replaced with ", a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc."; the term "The Shoko Chukin Bank, Ltd." in said paragraph shall be deemed to be replaced with "The Shoko Chukin Bank, Ltd or a Subsidiary, etc. of The Shoko Chukin Bank"; the term "to that effect. The same shall apply when, in the event that a resolution of shareholders meeting, etc. or consent of all shareholders or all class shareholders is required for share exchange under the provisions of this Act, the Companies Act, or the articles of incorporation, a Bank Holding Company, etc. that has received the Authorization of Eligibility, etc. has obtained or failed to obtain such resolution or consent for share exchange pertaining to said Authorization of Eligibility, etc." in said paragraph shall be deemed to be replaced with "to that effect."; the term "a Bank, etc., Bank Holding Company, etc., or The Shoko Chukin Bank, Ltd." in paragraph (2) of said Article shall be deemed to be replaced with "a Financial Institution, etc. that is a stock company, or Specified Holding Company, etc."; the term "a general meeting or general meeting of representatives" in said paragraph shall be deemed to be replaced with "a general meeting or general meeting of representatives, in the case of a Mutual Company prescribed in Article 2, paragraph (5) of the Insurance Business Act, a general meeting of members or general meeting of representatives, and in the case of a Financial Institution, etc. other than these or Specified Holding Company, etc., a body that decides its financial and operational or business policies"; the term "or federation of labor banks" in paragraph (3) of said Article shall be deemed to be replaced with ", a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc."; the term "The Shoko Chukin Bank, Ltd." in said paragraph shall be deemed to be replaced with "The Shoko Chukin Bank, Ltd or a Subsidiary, etc. of The Shoko Chukin Bank"; the term "paragraph (1) of the Act on Financial Institutions' Merger and Conversion" in said item shall be deemed to be replaced with "paragraph (1) of the Act on Financial Institutions' Merger and Conversion, or the principal sentence of Article 165-11, paragraph (1) of the Insurance Business Act"; the term "paragraph (2) of the Act on Financial Institutions' Merger and Conversion" in said item shall be deemed to be replaced with "paragraph (2) of the Act on Financial Institutions' Merger and Conversion, or Article 165-11, paragraph (2) of the Insurance Business Act"; the term "The Shoko Chukin Bank, Ltd." in paragraph (4) of said Article shall be deemed to be replaced with "The Shoko Chukin Bank, Ltd or a Subsidiary, etc. of The Shoko Chukin Bank"; the term "Transfer of Insured Deposits" in Article 67 shall be deemed to be replaced with "Specified Assumption of Obligations"; the term "or federation of labor banks" in paragraph (2) of said Article shall be deemed to be replaced with ", a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc."; the term "The Shoko Chukin Bank, Ltd." in said paragraph shall be deemed to be replaced with "The Shoko Chukin Bank, Ltd or a Subsidiary, etc. of The Shoko Chukin Bank"; the term "including those that will be newly established and, in the case of a Bank Holding Company, etc., limited to those specified in Article 2, paragraph (5), item (i) or (iii)" in Article 68-2, paragraph (2) shall be deemed to be replaced with "including those that will be newly established"; the term "Minister of Finance" in said paragraph shall be deemed to be replaced with "Minister of Finance, and the Minister of Health, Labour and Welfare and the Minister of Economy, Trade and Industry"; the term "Minister of Finance" in paragraph (3) of said Article shall be deemed to be replaced with "Minister of Finance (in the event that the Issuing Assuming Financial Institution, etc. is a Subsidiary, etc. of a Labor Bank, etc., the Prime Minister, the Minister of Finance, and the Minister of Health, Labour and Welfare, and in the event that the Issuing Assuming Financial Institution, etc. is a Subsidiary, etc. of The Shoko Chukin Bank, the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry)"; the term "Financial Institution or Bank Holding Company, etc. (limited to those specified in Article 2, paragraph (5), items (i) and (iii))" in Article 68-3, paragraph (2) shall be deemed to be replaced with "Financial Institution, etc. or Specified Holding Company, etc."; the term "or federation of labor banks" in paragraph (3) of said Article shall be deemed to be replaced with ", a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc."; the term "The Shoko Chukin Bank, Ltd." in said paragraph shall be deemed to be replaced with "The Shoko Chukin Bank, Ltd or a Subsidiary, etc. of The Shoko Chukin Bank"; and any other necessary technical replacement of terms shall be specified by Cabinet Order.
(Additional Specified Financial Assistance)
Article 126-32 (1) In the event that, subsequent to a Specified Merger, etc. pertaining to Specified Financial Assistance, a Specified Assuming Financial Institution, etc. or Specified Assuming Holding Company, etc. pertaining to said Specified Financial Assistance or a Financial Institution, etc. established by the merger or incorporation-type company split pertaining to said Specified Financial Assistance applies for additional Specified Financial Assistance (referred to as "Additional Specified Financial Assistance" in paragraphs (4) and (5)), the Corporation may, when it finds it necessary, provide the Additional Specified Financial Assistance to the Financial Institution, etc. or Specified Holding Company, etc. that has made said application.
(2) The purchase of assets pertaining to the application under the preceding paragraph shall be conducted with respect to the assets of the Specified Failed Financial Institution, etc. pertaining to a Specified Merger, etc. (limited to the Business Transfer, etc. specified in Article 126-28, paragraph (2), item (iii) in which a Specified Failed Financial Institution, etc. transfers part of its business to another Financial Institution, etc., the Specified Assumption of Obligations, the absorption-type company split specified in item (vi) of said paragraph where another Financial Institution, etc. succeeds to part of the rights and obligations held by the Specified Failed Financial Institution, etc. in relation to its business, or the incorporation-type company split specified in item (vii) of said paragraph where the Financial Institution, etc. newly established through the incorporation-type company split succeeds to part of the rights and obligations held by the Specified Failed Financial Institution, etc. in relation to its business) or assets prescribed in each of the following items according to the category of Specified Merger, etc. specified in each respective item, and if the Specified Financial Assistance pertaining to the application under the preceding paragraph includes the purchase of assets of the Specified Failed Financial Institution, etc. pertaining to a Specified Merger, etc. (limited to the Business Transfer, etc. specified in Article 126-28, paragraph (2), item (iii) in which a Specified Failed Financial Institution, etc. transfers part of its business to another Financial Institution, etc., the Specified Assumption of Obligations, the absorption-type company split specified in item (vi) of said paragraph where another Financial Institution, etc. succeeds to part of the rights and obligations held by the Specified Failed Financial Institution, etc. in relation to its business, or the incorporation-type company split specified in item (vii) of said paragraph where the Financial Institution, etc. newly established through the incorporation-type company split succeeds to part of the rights and obligations held by the Specified Failed Financial Institution, etc. in relation to its business; hereinafter the same shall apply in this paragraph and paragraph (4)), a Specified Assuming Financial Institution, etc. pertaining to said Specified Merger, etc. shall apply to the Corporation for the purchase of said assets in joint names with said Specified Failed Financial Institution, etc.:
(i) a merger specified in Article 126-28, paragraph (2), item (i): the assets of the Financial Institution, etc. surviving through the merger (limited to those that were the assets of the Specified Failed Financial Institution, etc. prior to the merger);
(ii) a merger specified in Article 126-28, paragraph (2), item (ii): the assets of the Financial Institution, etc. established by the merger (limited to those that were the assets of the Specified Failed Financial Institution, etc. prior to the merger);
(iii) a Business Transfer, etc. specified in Article 126-28, paragraph (2), item (iii): the assets of another Financial Institution, etc. prescribed in said item that have been received through the Business Transfer, etc.;
(iv) the acquisition of shares specified in Article 126-28, paragraph (2), item (v): the assets of a Financial Institution, etc. whose shares have been so acquired;
(v) the absorption-type company split specified in Article 126-28, paragraph (2), item (vi): the assets of another Financial Institution, etc. set forth in said item which said Financial Institution, etc. has succeeded to through the absorption-type company split; and
(vi) the incorporation-type company split specified in Article 126-28, paragraph (2), item (vii): the assets of the Financial Institution, etc. established through the incorporation-type company split (limited to those that were assets of the Specified Failed Financial Institution, etc. prior to the incorporation-type company split).
(3) The Securing of Damage pertaining to an application under paragraph (1) shall be performed with respect to the loan claims that are the assets prescribed in each of the preceding items according to the category of Specified Merger, etc. specified in such item
(4) The provisions of Article 59-2 shall apply mutatis mutandis to a Specified Assuming Financial Institution, etc. that has undertaken a Specified Merger, etc. pertaining to Specified Financial Assistance; the provisions of Article 64 (excluding paragraph (2)), Article 64-2, and Article 126-28, paragraphs (7) and (8) shall apply mutatis mutandis to an application under paragraph (1) or (2); the provisions of Articles 67 and 68 shall apply mutatis mutandis to Additional Specified Financial Assistance; and the provisions of Articles 68-2 and 68-3 shall apply mutatis mutandis to a Specified Assuming Financial Institution, etc., a Specified Assuming Holding Company, etc., or a Financial Institution, etc. established by the merger or incorporation-type company split pertaining to Specified Financial Assistance (excluding a Financial Institution, etc. for which the Corporation has provided Specified Financial Assistance pertaining to Subscription for Specified Preferred Shares, etc. and which actually holds Acquired Specified Preferred Shares, etc. (meaning the Acquired Specified Preferred Shares, etc. prescribed in Article 64-2, paragraph (6) as applied mutatis mutandis pursuant to this paragraph) pertaining to said Specified Financial Assistance, and including the company prescribed in Article 68-2, paragraph (2) as applied mutatis mutandis pursuant to this paragraph in the event that the approval set forth in paragraph (1) of said Article as applied mutatis mutandis pursuant to this paragraph has been obtained and the Bridge Financial Institution, etc. prescribed in Article 68, paragraph (4) as applied mutatis mutandis pursuant to this paragraph in the event that the approval set forth in Article 68-3, paragraph (1) as applied mutatis mutandis pursuant to this paragraph has been obtained), for which the Corporation has provided Additional Specified Financial Assistance (limited to those pertaining to Subscription for Specified Preferred Shares, etc.). In this case, the term "equity between creditors of the Failed Financial Institution" in Article 59-2, paragraph (1) shall be deemed to be replaced with "equity between creditors and any other interested persons of the Specified Failed Financial Institution, etc. (meaning the Specified Failed Financial Institution, etc. prescribed in Article 126-28, paragraph (1); the same shall apply hereinafter)"; the term "paragraph (6) of the preceding Article" in paragraph (3) of said Article shall be deemed to be replaced with "Article 126-28, paragraph (7)"; the term "Failed Financial Institution that have made an application under the provisions of the preceding two paragraphs, and the provisions of paragraph (7)" in said paragraph shall be deemed to be replaced with "Specified Failed Financial Institution, etc. that have made an application under the provisions of the preceding two paragraphs, and the provisions of paragraph (8)"; the term "Financial Assistance" in Article 64, paragraph (1) shall be deemed to be replaced with "Additional Specified Financial Assistance (meaning the Additional Specified Financial Assistance prescribed in Article 126-32, paragraph (1); the same shall apply hereinafter)"; the term "a merger, etc. to which a labor bank or federation of labor banks is a party" in paragraph (3) of said Article shall be deemed to be replaced with "a Specified Merger, etc. (meaning the Specified Merger, etc. prescribed in Article 126-28, paragraph (2); the same shall apply hereinafter) to which a labor bank, a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc. (meaning the Subsidiary, etc. of a Labor Bank, etc. prescribed in Article 126-2, paragraph (2), item (i); the same shall apply hereinafter) is a party"; the term "a merger, etc. to which The Shoko Chukin Bank, Ltd. is a party" in said paragraph shall be deemed to be replaced with "a Specified Merger, etc. to which The Shoko Chukin Bank, Ltd. or a Subsidiary, etc. of The Shoko Chukin Bank (the Subsidiary, etc. of The Shoko Chukin Bank prescribed in said item; the same shall apply hereinafter) is a party"; the term "Financial Institution or Bank Holding Company, etc." in paragraph (4) of said Article shall be deemed to be replaced with "Financial Institution, etc. (meaning the Financial Institution, etc. prescribed in Article 126-2, paragraph (2); the same shall apply hereinafter) or Specified Holding Company, etc. (meaning the Specified Holding Company, etc. prescribed in Article 126-28, paragraph (1); the same shall apply hereinafter)"; the term "Subscription for Preferred Shares, etc." in Article 64-2, paragraph (1) shall be deemed to be replaced with "Subscription for Specified Preferred Shares, etc. (meaning the Subscription for Specified Preferred Shares, etc. prescribed in Article 126-28, paragraph (3); the same shall apply hereinafter"; the term "Assuming Financial Institution or Assuming Bank Holding Company, etc. (excluding the companies specified in Article 2, paragraph (5), item (v); hereinafter the same shall apply in this Article)" in said paragraph shall be deemed to be replaced with "Financial Institution, etc. or Specified Holding Company, etc. prescribed in said paragraph"; the term "adequacy of equity capital" in paragraph (2) of said Article shall be deemed to be replaced with "adequacy of equity capital or otherwise improve the financial conditions"; the term "or federation of labor banks" in paragraph (3) of said Article shall be deemed to be replaced with ", a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc."; the term "The Shoko Chukin Bank, Ltd." in said paragraph shall be deemed to be replaced with "The Shoko Chukin Bank, Ltd or a Subsidiary, etc. of The Shoko Chukin Bank"; the term "Acquired Preferred Shares, etc. or Acquired Loan Claims" in paragraph (5) of said Article shall be deemed to be replaced with "Acquired Specified Preferred Shares, etc. or Acquired Specified Loan Claims"; the term "Subscription for Preferred Shares, etc." in said paragraph shall be deemed to be replaced with "Subscription for Specified Preferred Shares, etc."; the term "Acquired Preferred Shares, etc." in paragraph (6) of said Article shall be deemed to be "Acquired Specified Preferred Shares, etc."; the term "Subscription for Preferred Shares, etc." in item (i) of said paragraph shall be deemed to be replaced with "Subscription for Specified Preferred Shares, etc."; the term " Preferred Shares, etc. (including the following) and other Shares, etc. specified by Cabinet Order" in said item shall be deemed to be replaced with "Specified Preferred Shares, etc. (meaning Preferred Shares, etc., Specified Subordinated Bonds prescribed in Article 126-22, paragraph (6), item (i), equity investments of those other than stock companies and the cooperative structured financial institutions prescribed in Article 2, paragraph (1) of the Preferred Equity Investment Act, or claims pertaining to funds) (including the following in the case of Preferred Shares, etc., and including equivalents of the following in the case of Specified Subordinated Bonds prescribed in said item, equity investments of those other than stock companies and the cooperative structured financial institutions prescribed in Article 2, paragraph (1) of the Preferred Equity Investment Act, or claims pertaining to funds)"; the term "Transfer of Insured Deposits" in Article 67 shall be deemed to be replaced with "Specified Assumption of Obligations prescribed in Article 126-28, paragraph (2), item (iv)"; the term "or federation of labor banks" in paragraph (2) of said Article shall be deemed to be replaced with ", a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc."; the term "The Shoko Chukin Bank, Ltd." in said paragraph shall be deemed to be replaced with "The Shoko Chukin Bank, Ltd or a Subsidiary, etc. of The Shoko Chukin Bank"; the term "if the Corporation is to provide Financial Assistance for a merger, etc. pertaining to the Authorization of Eligibility, etc." in Article 68 shall be deemed to be replaced with "if Additional Specified Financial Assistance is to be provided"; the term "including those that will be newly established and, in the case of a Bank Holding Company, etc., limited to those specified in Article 2, paragraph (5), item (i) or (iii)" in Article 68-2, paragraph (2) shall be deemed to be replaced with "including those that will be newly established"; the term "Minister of Finance" in said paragraph shall be deemed to be replaced with "Minister of Finance, and the Minister of Health, Labour and Welfare and the Minister of Economy, Trade and Industry"; the term "Minister of Finance" in paragraph (3) of said Article shall be deemed to be replaced with "Minister of Finance (in the event that the Issuing Assuming Financial Institution, etc. is a Subsidiary, etc. of a Labor Bank, etc., the Prime Minister, the Minister of Finance, and the Minister of Health, Labour and Welfare, and in the event that the Issuing Assuming Financial Institution, etc. is a Subsidiary, etc. of The Shoko Chukin Bank, the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry)"; the term "Financial Institution or Bank Holding Company, etc. (limited to those specified in Article 2, paragraph (5), items (i) and (iii))" in Article 68-3, paragraph (2) shall be deemed to be replaced with "Financial Institution, etc. or Specified Holding Company, etc."; the term "or federation of labor banks" in paragraph (3) of said Article shall be deemed to be replaced with ", a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc."; the term "The Shoko Chukin Bank, Ltd." in said paragraph shall be deemed to be replaced with "The Shoko Chukin Bank, Ltd or a Subsidiary, etc. of The Shoko Chukin Bank"; and any other necessary technical replacement of terms shall be specified by Cabinet Order.
(5) In the event that a resolution by the Policy Board prescribed in Article 64, paragraph (1) as applied mutatis mutandis pursuant to the preceding paragraph is to be deliberated with respect to Additional Specified Financial Assistance pertaining to the application prescribed in paragraph (1) or (2) or Article 59-2, paragraph (1) as applied mutatis mutandis pursuant to the preceding paragraph, when the Policy Board finds that, in light of the financial conditions of the Specified Failed Financial Institution, etc., the Additional Specified Financial Assistance does not exceed the scope necessary to carry out the Specified Merger, etc. pertaining to said Additional Specified Financial Assistance, it may adopt a resolution to provide the Additional Specified Financial Assistance.
(Application of the Provisions of the Bankruptcy Act, etc. to Specified Merger, etc. Pertaining to Specified Authorization of Eligibility, etc.)
Article 126-33 The provisions of Article 78 and Article 93 of the Bankruptcy Act, Article 41, Article 42, Article 54, paragraphs (2) and (4), Article 66, and Article 81 of the Civil Rehabilitation Act, Article 32, Article 35, paragraphs (2) and (3), Article 45, Article 46, and Article 72 of the Corporate Reorganization Act, Article 23, Article 25 (excluding paragraph (1)), Article 32, Article 33, Article 45, Article 188, Article 190 (excluding paragraph (1)), Article 197, Article 198, and Article 211 of the Act on Special Treatment of Corporate Reorganization Proceedings and Other Insolvency Proceedings of Financial Institutions, Article 527, paragraph (1), Article 535, Article 536, and Article 896 of the Companies Act, and Article 31, Article 34, Article 35, Article 53, and Article 55, paragraph (1) of the Act on Recognition of and Assistance for Foreign Insolvency Proceedings shall not apply to a Specified Merger, etc. pertaining to Specified Authorization of Eligibility, etc.
(Decision to Establish Specified Bridge Financial Institution, etc.)
Article 126-34 (1) The Prime Minister may, when he/she finds it necessary to use a Specified Bridge Financial Institution, etc. for the Succession of Obligations, etc. (meaning succession of Obligations, etc. (meaning the business or obligations pertaining to Specified Assumption of Business, etc.; the same shall apply hereinafter) by a Specified Bridge Financial Institution, etc. through assumption of business, assumption of obligations, a merger, or a company split (hereinafter referred to as "Specified Assumption of Business, etc."), and smooth implementation of Payment, etc, of Obligations, etc. (meaning the provisional maintenance and continuation of the business or payment of the obligations; the same shall apply hereinafter)) of a Financial Institution, etc. under Special Surveillance, make the following decisions:
(i) that a Specified Bridge Financial Institution, etc. be established by the Corporation as a subsidiary company to carry out the Specified Assumption of Business, etc. in order to succeed to the business of a Financial Institution, etc. under Special Surveillance; and
(ii) that a Specified Bridge Financial Institution, etc. should carry out the Specified Assumption of Business, etc. in order to succeed to the business of a Financial Institution, etc. under Special Surveillance.
(2) The Prime Minister may, when he/she finds it necessary, rescind or modify a decision under the preceding paragraph.
(3) In this Chapter, the terms set forth in the following items have the meanings specified respectively in those items:
(i) Specified Bridge Bank: a bank that has succeeded to the Obligations, etc. of a Financial Institution, etc. under Special Surveillance through the Specified Assumption of Business, etc., whose primary purpose is to smoothly implement the Payment, etc. of said Obligations, etc., and that has been established as a subsidiary company of the Corporation;
(ii) Specified Bridge Insurance Company: an Insurance Company that has succeeded to the Obligations, etc. of a Financial Institution, etc. under Special Surveillance (limited to an Insurance Company or Foreign Insurance Company, etc.) through the Specified Assumption of Business, etc., whose primary purpose is to smoothly implement the Payment, etc. of said Obligations, etc., and that has been established as a subsidiary company of the Corporation;
(iii) Specified Bridge Financial Instruments Business Operator: a Financial Instruments Business Operator that has succeeded to the Obligations, etc. of a Financial Institution, etc. under Special Surveillance (limited to a Financial Instruments Business Operator) through the Specified Assumption of Business, etc., whose primary purpose is to smoothly implement the Payment, etc. of said Obligations, etc., and that has been established as a subsidiary company of the Corporation;
(iv) Specified Bridge Company: a stock company that has succeeded to the Obligations, etc. of a Financial Institution, etc. under Special Surveillance through the Specified Assumption of Business, etc., whose primary purpose is to smoothly implement the Payment, etc. of said Obligations, etc., and that has been established as a subsidiary company of the Corporation (excluding a Specified Bridge Bank, Specified Bridge Insurance Company, and Specified Bridge Financial Instruments Business Operator); and
(v) Specified Bridge Financial Institution, etc.: a Specified Bridge Bank, Specified Bridge Insurance Company, Specified Bridge Financial Instruments Business Operator, or Specified Bridge Company.
(4) A Specified Bridge Company shall be deemed to be a Financial Institution, etc. with regard to application of the provisions of Article 126-28, Article 126-30, and Article 59-2, Article 60, Article 62 (excluding paragraph (1)), and Article 64 (excluding paragraph (2)) through Article 68-3 as applied mutatis mutandis pursuant to Article 126-31, Article 126-32 (excluding paragraph (4)), and Article 59-2, Article 64 (excluding paragraph (2)), Article 64-2, and Articles 67 through 68-3 as applied mutatis mutandis pursuant to Article 126-32, paragraph (4), and Article 126-28, paragraphs (7) and (8), and Article 133-2 (including the penal provisions pertaining to these provisions).
(Establishment of a Specified Bridge Financial Institution, etc.)
Article 126-35 (1) When a decision prescribed in paragraph (1), item (i) of the preceding Article is made under paragraph (1) or (2) of the preceding Article, the Corporation shall, following a resolution by the Policy Board on the details of contribution pertaining to said decision, become the incorporator of a stock company that is to become a Specified Bridge Financial Institution, etc., and provide contribution for the incorporation of said stock company as a subsidiary company of the Corporation.
(2) In addition to the case prescribed in the preceding paragraph, any contribution by the Corporation to the Specified Bridge Financial Institution, etc. shall require a resolution by the Policy Board.
(3) Upon providing the contribution prescribed in the preceding two paragraphs, the Corporation shall promptly report the details thereof to the Prime Minister and the Minister of Finance.
(Management of Specified Bridge Financial Institution, etc.)
Article 126-36 (1) The Corporation shall manage the Specified Bridge Financial Institution, etc. to ensure the proper performance of the following matters:
(i) to carry out Specified Assumption of Business, etc. in order to succeed to the obligations, etc. of the Financial Institution, etc. under Special Surveillance that is subject to said decision, when a decision specified in Article 126-34, paragraph (1), item (ii) is made under Article 126-34, paragraph (1) or (2); and
(ii) to comply with the guidelines prescribed in the following paragraph in implementing the Payment, etc. of Obligations, etc. and carrying out other operations (including administration of the receipt and payment of the Deposits, etc., loan of funds, and the management and disposition of insurance contracts prescribed in Article 260, paragraph (10) of the Insurance Business Act; the same shall apply in item (ii) of the following paragraph).
(2) The Corporation shall prepare guidelines for the Payment, etc. of Obligations, etc. of a Specified Bridge Financial Institution, etc. in accordance with the following and, following approval from the Prime Minister, make such guidelines public:
(i) the guidelines shall be prepared, taking into account that the purpose of a Specified Bridge Financial Institution, etc. is to smoothly implement the Payment, etc. of Obligations, etc., and with a view to ensuring the smooth Payment, etc. of Obligations, etc. by a Specified Bridge Financial Institution, etc. while avoiding the risk of severe disruption being caused in the financial system in Japan; and
(ii) the guidelines shall include a provision that transactions designated by the Corporation among the Payment, etc. of Obligations, etc. and other operations should be carried out by a Specified Bridge Financial Institution, etc. following the approval by the Corporation.
(3) The Corporation may give instructions and advice to a Specified Bridge Financial Institution, etc., which are necessary for its management.
(Application Mutatis Mutandis of Provisions Concerning Bridge Bank)
Article 126-37 The provisions of Articles 95 through 100 and Article 135 (excluding paragraph (1)) shall apply mutatis mutandis to a Specified Bridge Financial Institution, etc. In this case, the term "for which confirmation has been rendered under Article 93, paragraph (2)" in Article 95 shall be deemed to be replaced with "pertaining to the Specified Assumption of Business, etc. prescribed in Article 126-34, paragraph (1)"; the term "business" in Article 96, paragraph (1) shall be deemed to be replaced with "Obligations, etc. (meaning the Obligations, etc. prescribed in Article 126-34, paragraph (1))"; the term "Injunction Ordering Management of the first Financial Institution under Management" in said paragraph shall be deemed to be replaced with "Designation of Special Surveillance (meaning the Designation of Special Surveillance prescribed in Article 126-3, paragraph (2)) for the first Financial Institution, etc. under Special Surveillance (meaning the Financial Institution, etc. under Special Surveillance prescribed in said paragraph)"; the term "Contracted Bridge Bank" in Article 97, paragraph (1) shall be deemed to be replaced with "Contracted Specified Bridge Financial Institution, etc."; the term "any right ... in the following paragraph) (limited to those that have been confirmed as appropriate assets to be held by said Bridge Bank under Article 93, paragraph (2))" in Article 135, paragraph (2) shall be deemed to be replaced with "any right ... in the following paragraph)"; the term "any right on land acquired through the Assumption of Business, etc. Based on Decision (limited to those that have been confirmed as appropriate assets to be held by said Bridge Bank under Article 93, paragraph (2))" in Article 135, paragraph (3) shall be deemed to be replaced with "any right on land acquired through the Assumption of Business, etc. Based on Decision"; and any other necessary technical replacement of terms shall be specified by Cabinet Order.
(Specified Financial Assistance to Specified Re-assuming Financial Institution, etc.)
Article 126-38 (1) A Financial Institution, etc. that is undertaking a Specified Re-succession and is not a Specified Bridge Financial Institution, etc. (hereinafter referred to as "Specified Re-succeeding Financial Institution, etc." in this Article), or a Specified Holding Company, etc. undertaking a Specified Re-succession and is not a Specified Bridge Financial Institution, etc. (hereinafter referred to as a "Specified Re-succeeding Specified Holding Company, etc." in this Article) may apply to have the Corporation provide Specified Financial Assistance (limited to that specified in Article 126-28, paragraph (1), item (iii), (vi) or (vii)) to support the Specified Re-succession.
(2) The term "Specified Re-succession" as used in the preceding paragraph means the following:
(i) a merger in which a Financial Institution, etc. that merges with a Specified Bridge Financial Institution, etc. survives;
(ii) a merger in which a Financial Institution, etc. is established through the merger of a Specified Bridge Financial Institution, etc. and another Financial Institution, etc.;
(iii) a transfer by a Specified Bridge Financial Institution, etc. of the whole of its business (in the event that the Corporation purchases part of the assets of said Specified Bridge Financial Institution, etc., excluding the portion pertaining to such assets to be purchased) to another Financial Institution, etc.;
(iv) the acquisition of shares of a Specified Bridge Financial Institution, etc. by another Financial Institution, etc. or Specified Holding Company, etc. to implement matters specified by the Prime Minister and the Minister of Finance as being necessary for ensuring sound and appropriate operation of said Specified Bridge Financial Institution, etc.;
(v) an absorption-type company split to which a Specified Bridge Financial Institution, etc. is a party where another Financial Institution, etc. succeeds to all of the rights and obligations held by the Specified Bridge Financial Institution, etc. in relation to its business (in the event that the Corporation purchases part of the assets of said Specified Bridge Financial Institution, etc., excluding the portion pertaining to such assets to be purchased) through said absorption-type company split; and
(vi) an incorporation-type company split to which a Specified Bridge Financial Institution, etc. is a party where the Financial Institution, etc. newly established through said incorporation-type company split succeeds to all of the rights and obligations held by the Specified Bridge Financial Institution, etc. in relation to its business (in the event that the Corporation purchases part of the assets of said Specified Bridge Financial Institution, etc., excluding the portion pertaining to such assets to be purchased) through said absorption-type company split.
(3) The purchase of assets prescribed in paragraph (1) shall be conducted with respect to the assets prescribed in each of the following items according to the category of the Specified Re-succession specified in each respective item:
(i) a merger specified in item (i) of the preceding paragraph: the assets of the Financial Institution, etc. surviving through the merger (limited to those that were the assets of the Specified Bridge Financial Institution, etc. prior to the merger);
(ii) a merger specified in item (ii) of the preceding paragraph: the assets of the Financial Institution, etc. that will be established by the merger (limited to those that were the assets of the Specified Bridge Financial Institution, etc. prior to the merger);
(iii) transfer of the business specified in item (iii) of the preceding paragraph: the assets of another Financial Institution, etc. prescribed in said item that have been received through the transfer of said business;
(iv) the acquisition of shares specified in item (iv) of the preceding paragraph: the assets of a Financial Institution, etc. whose shares have been acquired;
(v) the absorption-type company split specified in item (v) of the preceding paragraph: the assets of another Financial Institution, etc. set forth in said item which said Financial Institution, etc. has succeeded to through the absorption-type company split; and
(vi) the incorporation-type company split specified in item (vi) of the preceding paragraph: the assets of the Financial Institution, etc. established through the incorporation-type company split (limited to those that were assets of the Specified Bridge Financial Institution, etc. prior to the incorporation-type company split).
(4) The Securing of Damage prescribed in paragraph (1) shall be conducted with respect to loan claims that are the assets prescribed in each item of the preceding paragraph according to the category of the Specified Re-succession specified in each respective item of the preceding paragraph.
(5) The provisions of Article 126-28, paragraphs (4), (7), and (8), and Article 126-29, paragraph (1) shall apply mutatis mutandis to an application under paragraph (1); and the provisions of paragraphs (2) through (4) and paragraphs (6) through (8) of said Article shall apply mutatis mutandis to the authorization set forth in paragraph (1) of said Article as applied mutatis mutandis pursuant to this paragraph. In this case, the term "provided to the Specified Assuming Financial Institution, etc." in Article 126-28, paragraph (4) shall be deemed to be replaced with "provided to the Specified Re-succeeding Financial Institution, etc. (meaning the Specified Re-succeeding Financial Institution, etc. prescribed in Article 126-38, paragraph (1); the same shall apply hereinafter)"; the term "Specified Holding Company, etc." in paragraph (7) of said Article shall be deemed to be replaced with "Specified Re-succeeding Specified Holding Company, etc. (meaning the Specified Re-succeeding Specified Holding Company, etc. prescribed in Article 126-38, paragraph (1); the same shall apply hereinafter); the term "a Specified Merger, etc. pertaining to" in Article 126-29, paragraph (1) shall be deemed to be replaced with "a Specified Re-succession (meaning the Specified Re-succession prescribed in Article 126-38, paragraph (2); the same shall apply hereinafter) pertaining to"; the term "Article 126-31, a Specified Failed Financial Institution, etc." in said paragraph shall be deemed to be replaced with "Article 126-31, a Specified Bridge Financial Institution, etc. (meaning the Specified Bridge Financial Institution, etc. prescribed in Article 126-34, paragraph (3), item (v); the same shall apply hereinafter)"; and any other necessary technical replacement of terms shall be specified by Cabinet Order.
(6) Even in cases where no application is made under Article 126-29, paragraph (2) as applied mutatis mutandis pursuant to the preceding paragraph, the Prime Minister may, when he/she finds that the business or obligations of a Specified Bridge Financial Institution, etc. satisfy the requirements specified in paragraph (3), item (iii) of said Article as applied mutatis mutandis pursuant to the preceding paragraph, provide mediation in writing with regard to the Specified Re-succession (excluding the merger specified in paragraph (2), item (ii) and limited to those that contribute to the orderly resolution of assets and liabilities of a Financial Institution, etc. under Special Surveillance which said Specified Bridge Financial Institution, etc. has succeeded to and for which Specified Financial Assistance by the Corporation is indispensable) between said Specified Bridge Financial Institution, etc. and another Financial Institution, etc. or said Specified Bridge Financial Institution, etc. and a Specified Holding Company, etc.
(7) The provisions of Article 62, paragraphs (2) and (4) through (6) shall apply mutatis mutandis to the mediation prescribed in the preceding paragraph; the provisions of Article 64 (excluding paragraph (2)) and Article 64-2 shall apply mutatis mutandis to the application prescribed in paragraph (1); the provisions of Article 65 and Article 66 shall apply mutatis mutandis to the Financial Institution, etc. or Specified Holding Company, etc. that has received the authorization prescribed in Article 126-29, paragraph (1) as applied mutatis mutandis pursuant to paragraph (5) or that has received the mediation prescribed in the preceding paragraph; the provisions of Article 67 shall apply mutatis mutandis to the Specified Re-succeeding Financial Institution, etc.; the provisions of Article 68 shall apply mutatis mutandis to the Specified Financial Assistance provided by the Corporation for Specified Re-succession ; and the provisions of Article 68-2 and Article 68-3 shall apply mutatis mutandis to the Specified Re-succeeding Financial Institution, etc. that has received said Specified Financial Assistance (limited to those pertaining to the Subscription for Specified Preferred Shares, etc.) (including a Financial Institution, etc. established by the merger or incorporation-type company split pertaining to said Subscription for Specified Preferred Shares, etc.) or the Specified Re-succeeding Specified Holding Company, etc. (including the company prescribed in Article 68-2, paragraph (2) as applied mutatis mutandis pursuant to this paragraph in the event that the approval prescribed in Article 68-2, paragraph (1) as applied mutatis mutandis pursuant to this paragraph is granted, and the Bridge Financial Institution, etc. prescribed in Article 68-3, paragraph (4) as applied mutatis mutandis pursuant to this paragraph in the event that the approval prescribed in Article 68-3, paragraph (1) as applied mutatis mutandis pursuant to this paragraph is granted). In this case, the term "Financial Institution or Bank Holding Company, etc." in Article 62, paragraph (2) shall be deemed to be replaced with "Financial Institution, etc. (meaning the Financial Institution, etc. prescribed in Article 126-2, paragraph (2); the same shall apply hereinafter) or Specified Holding Company, etc. (meaning the Specified Holding Company, etc. prescribed in Article 126-28, paragraph (1); the same shall apply hereinafter)"; the term "paragraphs (4) to (7) of the preceding Article" in paragraph (4) of said Article shall be deemed to be replaced with "Article 126-29, paragraphs (4), (6), and (7) as applied mutatis mutandis pursuant to Article 126-38, paragraph (5)"; the term "Failed Financial Institution or a Financial Institution recognized as having a high probability of becoming a Failed Financial Institution" in paragraph (5) of said Article shall be deemed to be replaced with "Specified Bridge Financial Institution, etc. (meaning the Specified Bridge Financial Institution, etc. prescribed in Article 126-34, paragraph (3), item (v))"; the term "Financial Assistance" in Article 64, paragraph (1) shall be deemed to be replaced with "Specified Financial Assistance (meaning those set forth in Article 126-28, paragraph (1), item (iii), (vi), or (vii); the same shall apply hereinafter)"; the term "a merger, etc. to which a labor bank or federation of labor banks is a party" in paragraph (3) of said Article shall be deemed to be replaced with "Specified Re-succession (meaning the Specified Re-succession prescribed in Article 126-38, paragraph (2); the same shall apply hereinafter) to which a labor bank, a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc. (meaning the Subsidiary, etc. of a Labor Bank, etc. prescribed in Article 126-2, paragraph (2), item (i); the same shall apply hereinafter) is a party"; the term "a merger, etc. to which The Shoko Chukin Bank, Ltd. is a party" in said paragraph shall be deemed to be replaced with "Specified Re-succession to which The Shoko Chukin Bank, Ltd. or a Subsidiary, etc. of The Shoko Chukin Bank (the Subsidiary, etc. of The Shoko Chukin Bank prescribed in said item; the same shall apply hereinafter) is a party"; the term "Subscription for Preferred Shares, etc." in Article 64-2, paragraph (1) shall be deemed to be replaced with "Subscription for Specified Preferred Shares, etc. (meaning the Subscription for Specified Preferred Shares, etc. prescribed in Article 126-28, paragraph (3); the same shall apply hereinafter"; the term "Assuming Financial Institution or Assuming Bank Holding Company, etc. (excluding the companies specified in Article 2, paragraph (5), item (v)" in said paragraph shall be deemed to be replaced with "Specified Re-succeeding Financial Institution, etc. (meaning the Specified Re-succeeding Financial Institution, etc. prescribed in Article 126-38, paragraph (1); the same shall apply hereinafter) or Specified Re-succeeding Specified Holding Company, etc. (meaning the Specified Re-succeeding Specified Holding Company, etc. prescribed in said paragraph"; the term "adequacy of equity capital" in paragraph (2) of said Article shall be deemed to be replaced with "adequacy of equity capital or otherwise improve the financial conditions"; the term "or federation of labor banks" in paragraph (3) of said Article shall be deemed to be replaced with ", a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc."; the term "The Shoko Chukin Bank, Ltd." in said paragraph shall be deemed to be replaced with "The Shoko Chukin Bank, Ltd or a Subsidiary, etc. of The Shoko Chukin Bank"; the term "Acquired Preferred Shares, etc. or Acquired Loan Claims" in paragraph (5) of said Article shall be deemed to be replaced with "Acquired Specified Preferred Shares, etc. or Acquired Specified Loan Claims"; the term "Subscription for Preferred Shares, etc." in said paragraph shall be deemed to be replaced with "Subscription for Specified Preferred Shares, etc."; the term "Acquired Preferred Shares, etc." in paragraph (6) of said Article shall be deemed to be "Acquired Specified Preferred Shares, etc."; the term "Subscription for Preferred Shares, etc." in item (i) of said paragraph shall be deemed to be replaced with "Subscription for Specified Preferred Shares, etc."; the term " Preferred Shares, etc. (including the following) and other Shares, etc. specified by Cabinet Order" in said item shall be deemed to be replaced with "Specified Preferred Shares, etc. (meaning Preferred Shares, etc., Specified Subordinated Bonds prescribed in Article 126-22, paragraph (6), item (i), equity investments of those other than stock companies and the cooperative structured financial institutions prescribed in Article 2, paragraph (1) of the Preferred Equity Investment Act, or claims pertaining to funds) (including the following in the case of Preferred Shares, etc., and including equivalents of the following in the case of Specified Subordinated Bonds prescribed in said item, equity investments of those other than stock companies and the cooperative structured financial institutions prescribed in Article 2, paragraph (1) of the Preferred Equity Investment Act, or claims pertaining to funds)"; the term "or federation of labor banks" in Article 65 shall be deemed to be replaced with ", a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc."; the term "The Shoko Chukin Bank, Ltd." in said Article shall be deemed to be replaced with "The Shoko Chukin Bank, Ltd or a Subsidiary, etc. of The Shoko Chukin Bank"; the term "a merger, Business Transfer, etc., Transfer of Insured Deposits" in Article 66, paragraph (1) shall be deemed to be replaced with "a merger, Business Transfer, etc., Specified Assumption of Obligations (meaning the Specified Assumption of Obligations prescribed in Article 126-28, paragraph (2), item (iv); the same shall apply hereinafter)"; the term "a merger, Business Transfer, etc., Transfer of Insured Deposits" in said paragraph shall be deemed to be replaced with "a merger, Business Transfer, etc., Specified Assumption of Obligations"; the term "or federation of labor banks" in said paragraph shall be deemed to be replaced with ", a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc."; the term "The Shoko Chukin Bank, Ltd." in said paragraph shall be deemed to be replaced with "The Shoko Chukin Bank, Ltd or a Subsidiary, etc. of The Shoko Chukin Bank"; the term "to that effect. The same shall apply when, in the event that a resolution of shareholders meeting, etc. or consent of all shareholders or all class shareholders is required for share exchange under the provisions of this Act, the Companies Act, or the articles of incorporation, a Bank Holding Company, etc. that has received the Authorization of Eligibility, etc. has obtained or failed to obtain such resolution or consent for share exchange pertaining to said Authorization of Eligibility, etc." in said paragraph shall be deemed to be replaced with "to that effect."; the term "a Bank, etc., Bank Holding Company, etc., or The Shoko Chukin Bank, Ltd." in paragraph (2) of said Article shall be deemed to be replaced with "a Financial Institution, etc. that is a stock company, or Specified Holding Company, etc."; the term "a general meeting or general meeting of representatives" in said paragraph shall be deemed to be replaced with "a general meeting or general meeting of representatives, in the case of a Mutual Company prescribed in Article 2, paragraph (5) of the Insurance Business Act, a general meeting of members or general meeting of representatives, and in the case of a Financial Institution, etc. other than these or Specified Holding Company, etc., a body that decides its financial and operational or business policies"; the term "or federation of labor banks" in paragraph (3) of said Article shall be deemed to be replaced with ", a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc."; the term "The Shoko Chukin Bank, Ltd." in said paragraph shall be deemed to be replaced with "The Shoko Chukin Bank, Ltd or a Subsidiary, etc. of The Shoko Chukin Bank"; the term "paragraph (1) of the Act on Financial Institutions' Merger and Conversion" in said item shall be deemed to be replaced with "paragraph (1) of the Act on Financial Institutions' Merger and Conversion, or the principal sentence of Article 165-11, paragraph (1) of the Insurance Business Act"; the term "paragraph (2) of the Act on Financial Institutions' Merger and Conversion" in said item shall be deemed to be replaced with "paragraph (2) of the Act on Financial Institutions' Merger and Conversion, or Article 165-11, paragraph (2) of the Insurance Business Act"; the term "The Shoko Chukin Bank, Ltd." in paragraph (4) of said Article shall be deemed to be replaced with "The Shoko Chukin Bank, Ltd or a Subsidiary, etc. of The Shoko Chukin Bank"; the term "Transfer of Insured Deposits" in Article 67 shall be deemed to be replaced with "Specified Assumption of Obligations"; the term "or federation of labor banks" in paragraph (2) of said Article shall be deemed to be replaced with ", a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc."; the term "The Shoko Chukin Bank, Ltd." in said paragraph shall be deemed to be replaced with "The Shoko Chukin Bank, Ltd or a Subsidiary, etc. of The Shoko Chukin Bank"; the term "Issuing Assuming Financial Institution, etc." in Article 68-2 shall be deemed to be replaced with "Issuing Specified Re-succeeding Financial Institution, etc."; the term "including those that will be newly established and, in the case of a Bank Holding Company, etc., limited to those specified in Article 2, paragraph (5), item (i) or (iii)" in Article 68-2, paragraph (2) shall be deemed to be replaced with "including those that will be newly established"; the term "Minister of Finance" in said paragraph shall be deemed to be replaced with "Minister of Finance, and the Minister of Health, Labour and Welfare and the Minister of Economy, Trade and Industry"; the term "Minister of Finance" in paragraph (3) of said Article shall be deemed to be replaced with "Minister of Finance (in the event that the Issuing Specified Re-succeeding Financial Institution, etc. is a Subsidiary, etc. of a Labor Bank, etc., the Prime Minister, the Minister of Finance, and the Minister of Health, Labour and Welfare, and in the event that the Issuing Specified Re-succeeding Financial Institution, etc. is a Subsidiary, etc. of The Shoko Chukin Bank, the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry)"; the term "Financial Institution or Bank Holding Company, etc. (limited to those specified in Article 2, paragraph (5), items (i) and (iii))" in Article 68-3, paragraph (2) shall be deemed to be replaced with "Financial Institution, etc. or Specified Holding Company, etc."; the term "or federation of labor banks" in paragraph (3) of said Article shall be deemed to be replaced with ", a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc."; the term "The Shoko Chukin Bank, Ltd." in said paragraph shall be deemed to be replaced with "The Shoko Chukin Bank, Ltd or a Subsidiary, etc. of The Shoko Chukin Bank"; and any other necessary technical replacement of terms shall be specified by Cabinet Order.
(Payment of Specified Contributions, etc.)
Article 126-39 (1) When public notice is given under Article 123, paragraph (4) (including the cases where it is applied mutatis mutandis pursuant to Article 124, paragraph (3)), a Financial Institution, etc. shall, during the period specified in said public notice, pay contributions (hereinafter referred to as "Specified Contributions") to the Corporation to cover the costs incurred in carrying out the Crisis Management Operations (limited to those pertaining to a Financial Institution, etc. subject to Specified Confirmation or a Specified Bridge Financial Institution, etc.).
(2) When public notice is given under the preceding paragraph, a Financial Institution, etc. shall submit documents specified by Cabinet Office Ordinance and Ordinance of the Ministry of Finance and pay Specified Contributions to the Corporation by the last day of each business year included in the period specified in said public notice. In this case, in the event that there is a Bank Holding Company, Long Term Credit Bank Holding Company, Insurance Holding Company, or Designated Parent Company which has said Financial Institution, etc. as a Subsidiary, etc. of the Financial Institution, etc., said Financial Institution, etc. shall submit said documents and pay the Specified Contributions through such person, and in the event that there is no Bank Holding Company, Long Term Credit Bank Holding Company, Insurance Holding Company, or Designated Parent Company which has said Financial Institution, etc. as a Subsidiary, etc. of the Financial Institution, etc. but there is a Financial Institution, etc. that has said Financial Institution, etc. as a Subsidiary, etc. of the Financial Institution, etc., said Financial Institution, etc. shall submit said documents and pay the Specified Contributions through such Financial Institution, etc. that has said Financial Institution, etc. as a Subsidiary, etc. of the Financial Institution, etc. which is specified by Cabinet Office Ordinance and Ordinance of the Ministry of Finance.
(3) The amount of Specified Contributions prescribed in paragraph (1) shall be calculated for each Financial Institution, etc. by dividing by twelve the total amount of its liabilities outstanding on the last day of the business year immediately preceding the business year that includes the due date for payment of said Specified Contributions (excluding those specified by Cabinet Office Ordinance and Ordinance of the Ministry of Finance), multiplying the resulting amount by the number of months in the business year that includes the due date for payment of said Specified Contributions, and multiplying the resulting amount by the contribution rate specified under Article 123, paragraph (2).
(4) Notwithstanding the provisions of the preceding paragraph, the amount of Specified Contributions prescribed in paragraph (1) with regard to a Paying Financial Institution (meaning a Bank Holding Company, Long Term Credit Bank Holding Company, Insurance Holding Company, or Designated Parent Company, or a Financial Institution, etc. which has a Financial Institution, etc. as a Subsidiary, etc. of the Financial Institution, etc. that is specified by Cabinet Office Ordinance and Ordinance of the Ministry of Finance as set forth in paragraph (2); hereinafter the same shall apply in this paragraph) and a subsidiary company of said Paying Financial Institution, and any other entity specified by Cabinet Office Ordinance and Ordinance of the Ministry of Finance as a corporation of which management is controlled by the Paying Financial Institution (hereinafter referred to as the "Paying Financial Institution, etc.") shall be calculated for each Financial Institution, etc. that is a Paying Financial Institution by dividing by twelve the amount obtained by multiplying the total amount of its liabilities outstanding on the balance sheet prepared with regard to said Paying Financial Institution, etc. on a consolidated basis pursuant to the provisions of Cabinet Office Ordinance and Ordinance of the Ministry of Finance on the last day of the business year immediately preceding the business year that includes the due date for payment of said Specified Contributions (excluding such liabilities specified by Cabinet Office Ordinance and Ordinance of the Ministry of Finance) (hereinafter referred to as the "Consolidated Total Amount of Liabilities" in this paragraph) by the rate specified by Cabinet Office Ordinance and Ordinance of the Ministry of Finance as the rate of the amount of liabilities of each said Financial Institution, etc. to the Consolidated Total Amount of Liabilities, multiplying the resulting amount by the number of months in the business year that includes the due date for payment of said Specified Contributions, and multiplying the resulting amount by the contribution rate specified under Article 123, paragraph (2).
(5) The provisions of Article 50, paragraph (2) and Article 52 shall apply mutatis mutandis to the Specified Contributions set forth in paragraph (1). In this case, the term "exempt a Financial Institution" in Article 50, paragraph (2) shall be deemed to be replaced with "exempt a Financial Institution, etc. (meaning the Financial Institution, etc. prescribed in Article 126-2, paragraph (2); the same shall apply hereinafter); the term "authorization of eligibility, etc. prescribed in Article 65" in item (ii) of said paragraph shall be deemed to be replaced with "authorization of eligibility, etc. prescribed in Article 65 or Specified Authorization of Eligibility, etc. prescribed in Article 126-31"; the term "Failed Financial Institution" in said item shall be deemed to be replaced with "Failed Financial Institution or the Specified Failed Financial Institution, etc. prescribed in Article 126-28, paragraph (1) pertaining to said Specified Authorization of Eligibility, etc."; the term "a Injunction Ordering Management prescribed in Article 74, paragraph (1)" in item (iii) of said paragraph shall be deemed to be replaced with "a Injunction Ordering Management prescribed in Article 74, paragraph (1) or a Injunction Ordering Specified Management prescribed in Article 126-5, paragraph (1),"; the term "Financial Institution under Management pertaining to the Injunction Ordering Management" in said item shall be deemed to be replaced with "Financial Institution under Management pertaining to the Injunction Ordering Management or the Financial Institution, etc. pertaining to said Injunction Ordering Specified Management"; and the term "Financial Institution" in Article 52, paragraph (1) shall be deemed to be "Financial Institution, etc."; and any other necessary technical replacement of terms shall be specified by Cabinet Order.
Chapter VIII Miscellaneous Provisions
(Loan of Funds for Repayment of Deposits, etc.)
Article 127 The provisions of Article 69-3 shall apply mutatis mutandis to cases where an application is received from a person specified in each item of Article 69-3, paragraph (1) for the loan of funds necessary for the repayment of the covered Deposits, etc. (limited to the repayment for the covered Deposits, etc. corresponding to the amount of insurance proceeds calculated under the Insurance Claim Calculation Provision). In this case, the term "pertaining to said Settlement Obligations calculated under Article 54-2, paragraph (1) and Article 54, paragraph (3) as applied mutatis mutandis pursuant to Article 54-2, paragraph (2)" in Article 69-3, paragraph (1) shall be deemed to be replaced with "pertaining to said Covered Deposits, etc. calculated under the Insurance Claim Calculation Provision."
(Loan of Funds Necessary for the Repayment of Types of Obligations That Are Found Likely to Cause Severe Disruption in the Financial System)
Article 127-2 (1) In the event that the Corporation receives from any of the following persons an application for a loan of funds necessary for the repayment of the types of obligations that are found likely to cause severe disruption in the financial system in Japan by their default, the Corporation may, when it finds it necessary, and following a resolution of the Policy Board, decide to provide the loan pertaining to said application to the extent necessary:
(i) a Financial Institution, etc. subject to the Injunction Ordering Specified Management;
(ii) a Specified Failed Financial Institution, etc. (excluding a Foreign Bank Branch) that has become subject to a ruling for the commencement of bankruptcy proceedings or a Specified Failed Financial Institution, etc. (limited to a Foreign Bank Branch) pertaining to a Foreign Bank that has become subject to such ruling;
(iii) a Specified Failed Financial Institution, etc. (excluding a Foreign Bank Branch) that has become subject to a injunction ordering management by a provisional administrator under Article 91, paragraph (1) of the Bankruptcy Act or a Specified Failed Financial Institution, etc. (excluding a Foreign Bank Branch) pertaining to a Foreign Bank that has become subject to such injunction;
(iv) a Specified Failed Financial Institution, etc. (excluding a Foreign Bank Branch) that has become subject to a ruling for the commencement of reorganization proceedings or a Specified Failed Financial Institution, etc. (limited to a Foreign Bank Branch) of a Foreign Bank that has become subject to such ruling;
(v) a Specified Failed Financial Institution, etc. (excluding a Foreign Bank Branch) that has become subject to a injunction ordering management by a provisional administrator under Article 30, paragraph (1) of the Corporate Reorganization Act or Article 22, paragraph (1) or Article 187, paragraph (1) of the Act on Special Treatment of Corporate Reorganization Proceedings and Other Insolvency Proceedings of Financial Institutions or a Specified Failed Financial Institution, etc. (limited to a Foreign Bank Branch) of a Foreign Bank that has become subject to such injunction;
(vi) a Specified Failed Financial Institution, etc. (excluding a Foreign Bank Branch) that has become subject to a injunction ordering management by a provisional administrator under Article 64, paragraph (1) of the Civil Rehabilitation Act or a Specified Failed Financial Institution, etc. (limited to a Foreign Bank Branch) of a Foreign Bank that has become subject to such injunction;
(vii) a Specified Failed Financial Institution, etc. (excluding a Foreign Bank Branch) that has become subject to a injunction ordering management by a provisional administrator under Article 79, paragraph (1) of the Civil Rehabilitation Act or a Specified Failed Financial Institution, etc. (limited to a Foreign Bank Branch) of a Foreign Bank that has become subject to such injunction; and
(viii) a Specified Failed Financial Institution, etc. (excluding a foreign company, a Foreign Bank Branch, or a Foreign Insurance Company, etc.) that has become subject to an order for commencement of special liquidation, a Specified Failed Financial Institution, etc. (limited to a foreign company, a Foreign Bank Branch, or a Foreign Insurance Company, etc.) that has become subject to an order for commencement of liquidation under Article 822, paragraph (1) of the Companies Act, a Specified Failed Financial Institution, etc. (limited to a Foreign Bank Branch) for which liquidation has been commenced pursuant to Article 51, paragraph (1) of the Banking Act, or a Specified Failed Financial Institution, etc. (limited to a Foreign Insurance Company, etc.) for which liquidation has been commenced pursuant to Article 212, paragraph (1) of the Insurance Business Act.
(2) The provisions of Article 64, paragraph (3) shall apply mutatis mutandis to the cases where a decision is made under the preceding paragraph, and the provisions of Article 64, paragraph (4) shall apply mutatis mutandis to the cases where a decision to provide a loan is made under the preceding paragraph. In this case, the term "a merger, etc. to which a labor bank or federation of labor banks is a party" in paragraph (3) of said Article shall be deemed to be replaced with "a labor bank, a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc. prescribed in Article 126-2, paragraph (2), item (i)"; the term "a merger, etc. to which The Shoko Chukin Bank, Ltd. is a party" in said paragraph shall be deemed to be replaced with "The Shoko Chukin Bank, Ltd. or a Subsidiary, etc. of The Shoko Chukin Bank prescribed in said item"; and the term "a Financial Institution or Bank Holding Company, etc." in paragraph (4) of said Article shall be deemed to be replaced with "a Financial Institution, etc. prescribed in Article 126-2, paragraph (2)."
(3) The loan provided under paragraph (1) to a person specified in each of the following items shall, in relation to creditors other than the Corporation in bankruptcy proceedings (in the event that the Financial Institution, etc. is a Foreign Bank Branch, bankruptcy proceedings of the Foreign Bank pertaining to said Foreign Bank Branch), reorganization proceedings (in the event that the Financial Institution, etc. is a Foreign Bank Branch, reorganization proceedings of the Foreign Bank pertaining to said Foreign Bank Branch), rehabilitation proceedings (in the event that the Financial Institution, etc. is a Foreign Bank Branch, rehabilitation proceedings of the Foreign Bank pertaining to said Foreign Bank Branch; the same shall apply in item (iii)) or special liquidation proceedings (in the event that the Financial Institution, etc. is a foreign company, a Foreign Bank Branch, or a Foreign Insurance Company, etc., liquidation proceedings under Article 822 of the Companies Act (including the cases where it is applied mutatis mutandis pursuant to Article 213 of the Insurance Business Act), Article 51 of the Banking Act, or Article 212 of the Insurance Business Act) pertaining to said Financial Institution, etc. be deemed to be provided prior to the act prescribed in each respective item:
(i) the Specified Failed Financial Institution, etc. specified in paragraph (1), item (ii): said ruling for the commencement of bankruptcy proceedings;
(ii) the Specified Failed Financial Institution, etc. specified in paragraph (1), item (iv): said ruling for the commencement of reorganization proceedings;
(iii) a Specified Failed Financial Institution, etc. that has become subject to a ruling for the commencement of rehabilitation proceedings: said ruling for the commencement of rehabilitation proceedings; and
(iv) the Specified Failed Financial Institution, etc. specified in paragraph (1), item (viii): said order for commencement of special liquidation (in the event that the Financial Institution, etc. is a foreign company, a Foreign Bank Branch, or a Foreign Insurance Company, etc., the order for commencement of liquidation proceedings under Article 822, paragraph (1) of the Companies Act or commencement of liquidation under Article 51, paragraph (1) of the Banking Act or Article 212, paragraph (1) of the Insurance Business Act).
(Special Provisions of Companies Act Concerning Repayment of Deposits, etc.)
Article 127-3 The provisions of Article 69-4, paragraphs (3) to (5) shall apply mutatis mutandis to cases where a decision has been made to make the loan of funds under Article 69-3, paragraph (1) as applied mutatis mutandis pursuant to Article 127. In this case, the term "the repayment of the Settlement Obligations prescribed in paragraph (1) of the preceding Article" in Article 69-4, paragraph (3) shall be deemed to be replaced with "the repayment of the Deposits, etc. prescribed in paragraph (1) of the preceding Article as applied mutatis mutandis pursuant to Article 127," the terms "the types of the Settlement Obligations to be repaid", "repayment" and "repaid" in Article 69-4, paragraphs (4) and (5) shall be deemed to be replaced with "the types of the Deposits, etc. to be returned," "return" and "returned", respectively.
(Special Provisions of the Bankruptcy Act, etc. Concerning Repayment of the Types of Obligations That Are Found Likely to Cause Severe Disruption in the Financial System)
Article 127-4 (1) In the event that a decision has been made to loan funds under Article 127-2, paragraph (1) to a Financial Institution, etc. for which a ruling for the commencement of bankruptcy proceedings (in the event that the Financial Institution, etc. is a Foreign Bank Branch, bankruptcy proceedings of the Foreign Bank pertaining to said Foreign Bank Branch), a ruling for the commencement of reorganization proceedings (in the event that the Financial Institution, etc. is a Foreign Bank Branch, reorganization proceedings of the Foreign Bank pertaining to said Foreign Bank Branch), or a ruling for the commencement of rehabilitation proceedings (in the event that the Financial Institution, etc. is a Foreign Bank Branch, rehabilitation proceedings of the Foreign Bank pertaining to said Foreign Bank Branch) has been given, the court may, notwithstanding the provisions of Article 100, paragraph (1) of the Bankruptcy Act, Article 47, paragraph (1) of the Corporate Reorganization Act (including the cases where it is applied mutatis mutandis pursuant to Articles 34 and 199 of the Act on Special Treatment of Corporate Reorganization Proceedings and Other Insolvency Proceedings of Financial Institutions), and Article 85, paragraph (1) of the Civil Rehabilitation Act, in response to a petition filed by a bankruptcy trustee, a trustee in reorganization proceedings, or a rehabilitation debtor, etc. prescribed in Article 2, item (ii) of said Act, grant permission for the repayment of the types of obligations that are found likely to cause severe disruption in the financial system in Japan by their default under Article 127-2, paragraph (1) or any other act for extinguishing said obligations (hereinafter referred to as "Repayment" in this Article).
(2) The court shall, upon granting the permission under the preceding paragraph, specify the types of obligations subject to the Repayment, limit of the amount of Repayment, and period of Repayment (the last day of said period shall precede the last date of the period for filing proofs of claims).
(3) When specifying the types of obligations subject to the Repayment, limit of the amount of Repayment, and period of Repayment under the preceding paragraph, the court shall hear the opinion of the Corporation in advance.
(Special Provisions of the Companies Act, etc. Concerning Repayment of the Types of Obligations That Are Found Likely to Cause Severe Disruption in the Financial System)
Article 127-5 The provisions of Article 69-4, paragraphs (3) through (5) shall apply mutatis mutandis to the cases where a decision has been made to loan funds under Article 127-2, paragraph (1) to a Specified Failed Financial Institution, etc. that has become subject to an order for commencement of special liquidation or an order for commencement of liquidation under Article 822, paragraph (1) of the Companies Act or to a Specified Failed Financial Institution, etc. for which liquidation has been commenced pursuant to Article 51, paragraph (1) of the Banking Act or Article 212, paragraph (1) of the Insurance Business Act. In this case, the term "the Settlement Obligations prescribed in paragraph (1) of the preceding Article" in Article 69-4, paragraph (3) shall be deemed to be replaced with "the types of obligations that are found likely to cause severe disruption in the financial system in Japan by their default under Article 127-2, paragraph (1)"; the term "to be repaid" in paragraph (4) of said Article shall be deemed to be replaced with "subject to the Repayment or any other act for extinguishing said obligations (hereinafter referred to as "Repayment" in this Article"); and the term "the Settlement Obligations" in said paragraph and paragraph (5) of said Article shall be deemed to be replaced with "the obligations"; and any other necessary technical replacement of terms shall be specified by Cabinet Order.
(Loan of Funds to Prevent Decline in Asset Value)
Article 128 The provisions of Article 69-3 (excluding paragraphs (3) and (4)) shall apply mutatis mutandis to cases where an application is received from a person specified in each item of Article 69-3, paragraph (1) (in the case of any person specified in Article 69-3, paragraph (1), item (i), limited to the time after a petition is filed for the commencement of bankruptcy proceedings, commencement of reorganization proceedings or commencement of rehabilitation proceedings or after an order for commencement of special liquidation is issued, and in the case of any person specified items (ii) through (viii) of said paragraph, excluding a Financial Institution, etc. subject to Specified Confirmation) for the loan of funds necessary to prevent a decline in the value of loan claims or other assets held by such person. In this case, the term "up to the total amount of insurance proceeds pertaining to said Settlement Obligations calculated under Article 54-2, paragraph (1) and Article 54, paragraph (3) as applied mutatis mutandis pursuant to Article 54-2, paragraph (2)" in Article 69-3, paragraph (1) shall be deemed to be replaced with "within the limit necessary."
Article 128-2 (1) In the event that an application is received from any of the following persons (in the case of any person specified in item (i), limited to the time after a petition is filed for the commencement of bankruptcy proceedings (in the event that the person specified in said item is a Foreign Bank Branch, commencement of bankruptcy proceedings of the Foreign Bank pertaining to said Foreign Bank Branch), commencement of reorganization proceedings (in the event that the person specified in said item is a Foreign Bank Branch, commencement of reorganization proceedings of the Foreign Bank pertaining to said Foreign Bank Branch), or commencement of rehabilitation proceedings (in the event that the person specified in said item is a Foreign Bank Branch, commencement of rehabilitation proceedings of the Foreign Bank pertaining to said Foreign Bank Branch) or after an order for commencement of special liquidation (in the event that the person specified in said item is a foreign company, a Foreign Bank Branch, or a Foreign Insurance Company, etc., the order for commencement of liquidation proceedings under Article 822, paragraph (1) of the Companies Act or commencement of liquidation under Article 51, paragraph (1) of the Banking Act or Article 212, paragraph (1) of the Insurance Business Act) is issued) for the loan of funds necessary to prevent a decline in the value of loan claims or other assets held by such person, the Corporation may, when it finds it necessary, and following a resolution of the Policy Board, decide to provide the loan pertaining to said application to the extent necessary:
(i) a Financial Institution, etc. subject to the Injunction Ordering Specified Management;
(ii) a Specified Failed Financial Institution, etc. (excluding a Foreign Bank Branch) that has become subject to a ruling for the commencement of bankruptcy proceedings or a Specified Failed Financial Institution, etc. (limited to a Foreign Bank Branch) pertaining to a Foreign Bank that has become subject to such ruling;
(iii) a Specified Failed Financial Institution, etc. (excluding a Foreign Bank Branch) that has become subject to a injunction ordering management by a provisional administrator under Article 91, paragraph (1) of the Bankruptcy Act or a Specified Failed Financial Institution, etc. (limited to a Foreign Bank Branch) of a Foreign Bank that has become subject to such injunction;
(iv) a Specified Failed Financial Institution, etc. (excluding a Foreign Bank Branch) that has become subject to a ruling for the commencement of reorganization proceedings or a Specified Failed Financial Institution, etc. (limited to a Foreign Bank Branch) of a Foreign Bank that has become subject to such ruling;
(v) a Specified Failed Financial Institution, etc. (excluding a Foreign Bank Branch) that has become subject to a injunction ordering management by a provisional administrator under Article 30, paragraph (1) of the Corporate Reorganization Act or Article 22, paragraph (1) or Article 187, paragraph (1) of the Act on Special Treatment of Corporate Reorganization Proceedings and Other Insolvency Proceedings of Financial Institutions or a Specified Failed Financial Institution, etc. (limited to a Foreign Bank Branch) of a Foreign Bank that has become subject to such injunction;
(vi) a Specified Failed Financial Institution, etc. (excluding a Foreign Bank Branch) that has become subject to a injunction ordering management by a provisional administrator under Article 64, paragraph (1) of the Civil Rehabilitation Act or a Specified Failed Financial Institution, etc. (limited to a Foreign Bank Branch) of a Foreign Bank that has become subject to such injunction;
(vii) a Specified Failed Financial Institution, etc. (excluding a Foreign Bank Branch) that has become subject to a injunction ordering management by a provisional administrator under Article 79, paragraph (1) of the Civil Rehabilitation Act or a Specified Failed Financial Institution, etc. (limited to a Foreign Bank Branch) of a Foreign Bank that has become subject to such injunction; and
(viii) a Specified Failed Financial Institution, etc. (excluding a foreign company, a Foreign Bank Branch, or a Foreign Insurance Company, etc.) that has become subject to an order for commencement of special liquidation, a Specified Failed Financial Institution, etc. (limited to a foreign company, a Foreign Bank Branch, or a Foreign Insurance Company, etc.) that has become subject to an order for commencement of liquidation under Article 822, paragraph (1) of the Companies Act, a Specified Failed Financial Institution, etc. (limited to a Foreign Bank Branch) for which liquidation has been commenced pursuant to Article 51, paragraph (1) of the Banking Act, or a Specified Failed Financial Institution, etc. (limited to a Foreign Insurance Company, etc.) for which liquidation has been commenced pursuant to Article 212, paragraph (1) of the Insurance Business Act.
(2) The provisions of Article 64, paragraph (3) shall apply mutatis mutandis to the cases where a decision is made under the preceding paragraph, and the provisions of Article 64, paragraph (4) shall apply mutatis mutandis to the cases where a decision to provide a loan is made under the preceding paragraph. In this case, the term "a merger, etc. to which a labor bank or federation of labor banks is a party" in paragraph (3) of said Article shall be deemed to be replaced with "a labor bank, a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc. prescribed in Article 126-2, paragraph (2), item (i)"; and the term "a merger, etc. to which The Shoko Chukin Bank, Ltd. is a party" in said paragraph shall be deemed to be replaced with "The Shoko Chukin Bank, Ltd. or a Subsidiary, etc. of The Shoko Chukin Bank prescribed in said item"; and any other necessary technical replacement of terms shall be specified by Cabinet Order.
(Purchase of Assets)
Article 129 (1) In addition to cases prescribed in Section 4 of Chapter III and the preceding Chapter, the Corporation may purchase assets held by a Contracted Bridge Bank, Bank Under Special Crisis Management, Financial Institution, etc. under Special Surveillance, or Contracted Specified Bridge Financial Institution, etc.
(2) In cases where the Corporation is to purchase assets under the preceding paragraph, it shall comply with standards prescribed and publicly announced in advance by the Prime Minister and the Minister of Finance.
(3) Upon receiving an application under paragraph (1) for the purchase of assets from a Contracted Bridge Bank, Bank Under Special Crisis Management, Financial Institution, etc. under Special Surveillance, or Contracted Specified Bridge Financial Institution, etc., the Corporation shall, following a resolution of the Policy Board, decide without delay whether or not to carry out the purchase of assets pertaining to said application.
(4) Upon making a decision under the preceding paragraph, the Corporation shall immediately report matters pertaining to the decision to the Prime Minister and the Minister of Finance.
(5) Upon making a decision to purchase assets under paragraph (3), the Corporation shall conclude a contract for the purchase of assets with said Contracted Bridge Bank, Bank Under Special Crisis Management, Financial Institution, etc. under Special Surveillance, or Contracted Specified Bridge Financial Institution, etc.
(Special Provisions for Convocation Procedure for General Meeting of Shinkin Bank, etc.)
Article 130 (1) Notwithstanding the provisions of Article 45 of the Shinkin Bank Act, Article 49 of the Small and Medium-Sized Enterprises Cooperatives Act, and Article 49 of the Labor Bank Act, a general meeting of a Shinkin Bank, etc. that has received the Authorization of Eligibility, etc. or Specified Authorization of Eligibility, etc. may be held without the procedures of calling if all members (in the case of a labor bank, excluding individual members prescribed in Article 13, paragraph (1) of the Labor Bank Act) or all association members consent, for the purpose of deliberating a resolution to approve a Business Transfer, etc. and any amendment to the articles of incorporation necessary to carry out the Business Transfer, etc.
(2) The provisions of the preceding paragraph shall apply mutatis mutandis to a general meeting of representatives for the purpose of deliberating a resolution to approve the matters prescribed in the preceding paragraph. In this case, the terms "all members (in the case of a labor bank, excluding individual members prescribed in Article 13, paragraph (1) of the Labor Bank Act) or all association members" and "Article 45 of the Shinkin Bank Act, Article 49 of the Small and Medium-Sized Enterprises Cooperatives Act, and Article 49 of the Labor Bank Act" in said paragraph shall be deemed to be replaced with "all representatives" and "Article 45 of the Shinkin Bank Act as applied mutatis mutandis pursuant to Article 49, paragraph (5) of said Act, Article 49 of the Small and Medium-Sized Enterprises Cooperatives Act as applied mutatis mutandis pursuant to Article 55, paragraph (6) of said Act, and Article 49 of the Labor Bank Act as applied mutatis mutandis pursuant to Article 55, paragraph (5) of said Act", respectively.
(Special Provisions for Procedures for Protection of Creditors in Business Transfer, etc.)
Article 131 (1) When a decision to provide Financial Assistance is made under Article 64, paragraph (1) for the purpose of supporting the Business Transfer, etc. prescribed in Article 59, paragraph (2), item (iii) or a Transfer of Insured Deposits, or when a decision to provide Specified Financial Assistance is made under Article 64, paragraph (1) as applied mutatis mutandis pursuant to Article 126-31 for the purpose of supporting the Business Transfer, etc. prescribed in Article 126-28, paragraph (2), item (iii) or Specified Assumption of Obligations, the assumption of obligations pertaining to Specified Business Transfer, etc. (meaning the Business Transfer, etc. prescribed in Article 59, paragraph (2), item (iii) or a Transfer of Insured Deposits or the Business Transfer, etc. prescribed in Article 126-28, paragraph (2), item (iii) or Specified Assumption of Obligations, and including any transfer of assets associated therewith; hereinafter the same shall apply in this Article) and transfer of claims with a special clause prohibiting transfer (referred to as "Assumption of Obligations, etc." in paragraph (6)) may be carried out without consent from creditors pertaining to obligations assumed by the Assuming Financial Institution or Specified Assuming Financial Institution, etc. through said Specified Business Transfer, etc. and creditors pertaining to claims with a special clause prohibiting transfer which the Assuming Financial Institution or Specified Assuming Financial Institution, etc. received by transfer (referred to as "Transferred Creditors, etc." in paragraph (6)).
(2) The provisions of Article 34 and Article 35 of the Banking Act (including the cases where these provisions are applied mutatis mutandis pursuant to Article 17 of the Long-Term Credit Bank Act, Article 89, paragraph (1) of the Shinkin Bank Act, Article 6, paragraph (1) of the Act on Financial Business by Cooperatives, and Article 94, paragraph (1) of the Labor Bank Act) and Article 50-2, paragraph (6) of the Financial Instruments and Exchange Act shall not apply to the Specified Business Transfer, etc. pertaining to a decision under the preceding paragraph.
(3) Upon executing the Specified Business Transfer, etc. pertaining to a decision under paragraph (1), the Failed Financial Institution and Assuming Financial Institution or the Specified Failed Financial Institution, etc. and Specified Assuming Financial Institution, etc. shall, within two weeks of the day of said execution, give public notice of the gist of the contents of said Specified Business Transfer, etc. and to the effect that any creditors and obligors pertaining to claims with a special clause prohibiting transfer who have any objection thereto should state the objection within a specified period of time, and shall also give notice of the same individually to each known creditor and obligor pertaining to claims with a special clause prohibiting transfer other than the Depositors, etc. and other creditors specified by Cabinet Order.
(4) The period under the preceding paragraph cannot be less than one month.
(5) Notwithstanding the provisions of paragraph (3), if a Failed Financial Institution and Assuming Financial Institution or the Specified Failed Financial Institution, etc. and Specified Assuming Financial Institution, etc. give public notice under that paragraph by the method of public notice prescribed in the articles of incorporation (in the case of a foreign company, Foreign Bank Branch, or Foreign Insurance Company, etc., the method of public notice under Article 939, paragraph (2) or (4) of the Companies Act, Article 49-2, paragraph (1) of the Banking Act, or Article 217, paragraph (1) or (4) of the Insurance Business Act; the same shall apply hereinafter), in addition to the official gazette, the Failed Financial Institution and Assuming Financial Institution or the Specified Failed Financial Institution, etc. and Specified Assuming Financial Institution, etc. shall not be required to give separate notices under the provisions of paragraph (3).
(6) In the event that the Transferred Creditors, etc. state objections within the period under paragraph (3), the Assumption of Obligations, etc. pertaining to said Transferred Creditors, etc. shall lose its effect retroactively as of the time of said Assumption of Obligations, etc.; provided, however, that this shall not prejudice the rights of a third party.
(7) In the event that creditors of a Failed Financial Institution (limited to creditors pertaining to the obligations of the Failed Financial Institution other than those assumed by the Assuming Financial Institution through the Business Transfer, etc. set forth in Article 59, paragraph (2), item (iii) or the Transfer of Insured Deposits prescribed in paragraph (1)) or creditors of a Specified Failed Financial Institution, etc. (limited to creditors pertaining to the obligations of Specified Failed Financial Institution, etc. other than those assumed by the Specified Assuming Financial Institution, etc. through the Business Transfer, etc. set forth in Article 126-28, paragraph (2), item (iii) or the Specified Assumption of Obligations prescribed in paragraph (1)) state objections within the period under paragraph (3), when any amount is owed to creditors of the Failed Financial Institution or creditors of the Specified Failed Financial Institution, etc. with respect to their claims that can no longer be satisfied due to the Specified Business Transfer, etc. prescribed in paragraph (1), said creditors of the Failed Financial Institution or creditors of the Specified Failed Financial Institution, etc. may claim the payment of said amount from the Assuming Financial Institution or the Specified Assuming Financial Institution, etc.
(8) In the event that creditors of an Assuming Financial Institution (limited to creditors pertaining to the obligations of the Assuming Financial Institution other than those assumed by the Assuming Financial Institution through the Business Transfer, etc. set forth in Article 59, paragraph (2), item (iii) or the Transfer of Insured Deposits prescribed in paragraph (1)) or creditors of a Specified Assuming Financial Institution, etc. (limited to creditors pertaining to the obligations of Specified Assuming Financial Institution, etc. other than those assumed by the Specified Assuming Financial Institution, etc. through the Business Transfer, etc. set forth in Article 126-28, paragraph (2), item (iii) or the Specified Assumption of Obligations prescribed in paragraph (1)) state objections within the period under paragraph (3), the Assuming Financial Institution or Specified Assuming Financial Institution, etc. shall make payment or provide equivalent security to such creditors or entrust equivalent assets to a trust company or Financial Institutions that conducts trust business for the purpose of ensuring that such creditors receive the payment; provided, however, that this shall not apply when said Specified Business Transfer, etc. is unlikely to be detrimental to such creditors of the Assuming Financial Institution or creditors of the Specified Assuming Financial Institution, etc.
(Special Provisions for Procedure for Change of Trustees in Succession of Trust Business)
Article 132 (1) Notwithstanding the provisions of Article 56, paragraph (1) and Article 57, paragraph (1) and paragraph (2) of the Trust Act (Act No. 108 of 2006) and Article 7 of the Act on Charitable Trusts (Act No. 62 of 1922), when there is a decision to provide Financial Assistance under Article 64, paragraph (1) to support the transfer of business of a Failed Financial Institution or Specified Failed Financial Institution, etc. that conducts trust business under Article 1, paragraph (1) of the Act on Provision, etc. of Trust Business by Financial Institutions to a Financial Institution that conducts trust business under Article 1, paragraph (1) of said Act or there is a decision to provide Specified Financial Assistance under Article 64, paragraph (1) as applied mutatis mutandis pursuant to Article 126-31, said Failed Financial Institution or Specified Failed Financial Institution, etc. may, under a contract for the transfer of business with an Assuming Financial Institution pertaining to said Financial Assistance or a Specified Assuming Financial Institution, etc. pertaining to said Specified Financial Assistance (hereinafter referred to as "New Trustee" in this Article and the following Article), effect a change of trustee for trusts that have been assumed.
(2) When a change of trustee is effected under the preceding paragraph, the New Trustee (excluding the New Trustee of the special purpose trust (meaning those prescribed in Article 2, paragraph (13) of the Act on Securitization of Assets (Act No. 105 of 1998); the same shall apply in the following Article); hereinafter the same shall apply in this Article) shall immediately give public notice to the effect that any settlors of a trust subject to said change (hereinafter referred to as "Transferred Settlors" in this Article) or beneficiaries (hereinafter referred to as "Transferred Beneficiaries" in this Article) who have any objection thereto should state the objection within a specified period of time, and shall also give notice of the same individually to all known Transferred Settlors and Transferred Beneficiaries other than those pertaining to loan trusts and other trusts specified by Cabinet Order as trust pertaining to standard trust contracts (referred to as "Standard Trusts" in paragraph (5)).
(3) The period under the preceding paragraph cannot be less than one month.
(4) Notwithstanding the provisions of paragraph (2), if the New Trustee gives public notice under that paragraph by the method of public notice prescribed in the articles of incorporation, in addition to the official gazette, the New Trustee shall not be required to give separate notices under the provisions of that paragraph.
(5) The Transfer Beneficiaries of loan trusts, etc. (meaning the Standard Trusts specified by Cabinet Order as those to which settlors are entitled to all profits derived therefrom) who have raised objections within the period under paragraph (2) may demand that the New Trustee purchase the beneficiary rights of said Transfer Beneficiaries at a fair price to which they would have been entitled if the change prescribed in paragraph (1) had not occurred.
(6) If a demand is made under the preceding paragraph, the New Trustee shall purchase beneficiary rights subject to said demand with the New Trustee's own assets. In this case, Article 11 of the Loan Trust Act (Act No. 195 of 1952) shall not apply.
(7) The provisions of Article 75, paragraph (1), Article 76 and Article 77 of the Trust Act shall apply mutatis mutandis to cases where the change prescribed in paragraph (1) is made, and the provisions of Article 103, paragraph (6) and (7), Article 104, paragraphs (1) to (10), Article 262, paragraph (1) and (2), Article 263, and Article 264 of said Act shall apply mutatis mutandis to the purchase demand of own beneficiary rights under paragraph (5). In this case, any necessary technical replacement of terms shall be specified by Cabinet Order.
Article 132-2 (1) In the event that a change is made under paragraph (1) of the preceding Article with respect to a Failed Financial Institution or Specified Failed Financial Institution, etc. that is a trustee of a special purpose trust, the New Trustee shall convene a meeting of rightholders (meaning the meeting of rightholders prescribed in Subsection 1 of Section 3 of Chapter III of Part III of the Act on Securitization of Assets; the same shall apply in the following paragraph) without delay and seek approval for said change. In this case, the provisions of Article 244, paragraph (3) of said Act shall not apply.
(2) When a meeting of rightholders rejects a proposal for the approval prescribed in the preceding paragraph, the duties of the New Trustee pertaining to said special purpose trust shall end.
(3) The provisions of the main clause of Article 59, paragraph (4) of the Trust Act shall apply mutatis mutandis to the New Trustee whose duties have ended pursuant to the preceding paragraph.
(4) The provisions of Article 75, paragraph (1), Article 76 and Article 77 of the Trust Act shall apply mutatis mutandis to cases where a change is made under paragraph (1) of the preceding Article with respect to a Failed Financial Institution or Specified Failed Financial Institution, etc. that is a trustee of a special purpose trust.
(Special Provisions on the Procedure for Transfer of Status as the Settlor)
Article 132-3 (1) Notwithstanding the provisions of Article 146, paragraph (1) of the Trust Act, when there is a decision to provide Specified Financial Assistance under Article 64, paragraph (1) as applied mutatis mutandis pursuant to Article 126-31 to support the transfer of business conducted by a Specified Failed Financial Institution, etc. that is the settlor of a trust, said Specified Failed Financial Institution, etc. may transfer the status as the settlor of the trust agreement pertaining to said trust (limited to a trust pertaining to a trust agreement concluded based on the provisions of Article 43-2, paragraph (2) of the Financial Instruments and Exchange Act or any other trust specified by Cabinet Order as being equivalent thereto) based on the contract pertaining to the business transfer concluded with the Specified Assuming Financial Institution, etc. pertaining to said Specified Financial Assistance (hereinafter referred to as the "New Settlor" in this Article) to said New Settlor.
(2) When the status as the settlor of a trust agreement has been transferred under the preceding paragraph, the New Settlor shall immediately give public notice to the effect that any trustee of a trust subject to said transfer (hereinafter referred to as "Transferred Trustees" in this paragraph and paragraph (5)) or beneficiaries (hereinafter referred to as "Transferred Beneficiaries" in paragraph (5)) who have any objection thereto should state the objection within a specified period of time, and shall also give notice of the same individually to each Transferred Trustee.
(3) The period under the preceding paragraph cannot be less than one month.
(4) Notwithstanding the provisions of paragraph (2), if the New Settlor gives public notice under that paragraph by the method of public notice prescribed in the articles of incorporation, in addition to the official gazette, the New Settlor shall not be required to give separate notice under the provisions of that paragraph.
(5) In the event that the Transferred Trustees or Transferred Beneficiaries state objections within the period under paragraph (2), the transfer of the status of the settlor of the trust agreement pertaining to said Transferred Trustees or Transferred Beneficiaries shall lose its effect retroactively as of the time of said transfer; provided, however, that this shall not prejudice the rights of a third party.
(Special Provisions on Book-entry Procedure)
Article 132-4 (1) When there is a decision to provide Specified Financial Assistance under Article 64, paragraph (1) as applied mutatis mutandis pursuant to Article 126-31 to support the transfer of business conducted by a Specified Failed Financial Institution, etc. that is an Account Management Institution (meaning the account management institution prescribed in Article 2, paragraph (4) of the Act on Book-Entry of Company Bonds, Shares, etc. (Act No. 75 of 2001); hereinafter the same shall apply in this Article), and a contract pertaining to the business transfer is concluded between the Specified Failed Financial Institution, etc. pertaining to said Specified Financial Assistance and a Specified Assuming Financial Institution, etc., the accounts (limited to those on which the Specified Assuming Financial Institution, etc. will make book-entries as a result of said business transfer) of Participants (meaning the participants prescribed in Article 2, paragraph (3) of said Act; hereinafter the same shall apply in this Article) opened by the Specified Failed Financial Institution, etc. shall be deemed to be accounts of Participants opened by said Specified Assuming Financial Institution, etc.
(2) When there is a decision to provide Specified Financial Assistance under Article 64, paragraph (1) as applied mutatis mutandis pursuant to Article 126-31 to support the transfer of business conducted by a Specified Failed Financial Institution, etc. that is an Account Management Institution, and a contract pertaining to the business transfer is concluded between the Specified Failed Financial Institution, etc. pertaining to said Specified Financial Assistance and a Specified Assuming Financial Institution, etc., the accounts (limited to those to describe or record book-entry company bonds for which the Specified Assuming Financial Institution, etc. or a Participant of the Specified Assuming Financial Institution, etc. or of its Lower-Positioned Institution (meaning the lower-positioned institution prescribed in Article 2, paragraph (9) of the Act on Book-Entry of Company Bonds, Shares, etc.) has rights; hereinafter the same shall apply in this paragraph) which the Specified Failed Financial Institution, etc. had the book-entry institution prescribed in Article 2, paragraph (2) of said Act (including the Bank of Japan which is deemed to be a book-entry institution pursuant to Article 48 of said Act) or another Account Management Institution open shall be deemed to be accounts which said Specified Assuming Financial Institution, etc. has such institution open.
(Special Provisions for Assignment of Revolving Mortgage)
Article 133 (1) When a Financial Institution under Management intends to assign a revolving mortgage together with all of the claims it shall secure before the principal is established, through the transfer of business to a Bridge Bank or another Financial Institution (hereinafter referred to as the "Bridge Financial Institution" in this Article), said Financial Institution under Management and the Bridge Financial Institution may give public notice to the effect that any revolving mortgagors who have any objection to the following matters should state the objection to said Financial Institution under Management within a specified period of time, or may give individual notice of the same:
(i) the fact that said revolving mortgage is to be assigned by said Financial Institution under Management to said Bridge Financial Institution and the date thereof; or
(ii) the fact that said claims are to continue to be secured by said revolving mortgage even after it is assigned.
(2) The period under the preceding paragraph cannot be less than two weeks.
(3) Notwithstanding the provisions of paragraph (1), if a Financial Institution under Management and the Bridge Financial Institution give public notice under that paragraph by the method of public notice prescribed in the articles of incorporation, in addition to the official gazette, said Financial Institution under Management and Bridge Financial Institution shall not be required to give separate notices under the provisions of that paragraph.
(4) When a revolving mortgagor pertaining to the public notice or notice under paragraph (1) does not raise any objections with respect to the matters prescribed in each item of that paragraph within the period under that paragraph, it shall be deemed that the revolving mortgagor has consented to the matters specified in paragraph (1), item (i) and that there has been an agreement on the matters specified in paragraph (1), item (ii) between the revolving mortgagors and the Bridge Financial Institution pertaining to the public notice or notice prescribed in paragraph (1).
(5) When the revolving mortgagor has stated its objection to part of the matters specified in each item of paragraph (1), it shall be deemed that it has stated objections to all of the matters specified in such item.
(6) The provisions of all preceding paragraphs shall apply mutatis mutandis to cases where a Bridge Bank or Bank Under Special Crisis Management seeks to assign the revolving mortgage together with all of the claims to be secured thereby, before the principal is established through the transfer of business to another Financial Institution.
Article 133-2 (1) Notwithstanding the provisions of Article 398-12, paragraph (1) of the Civil Code, a Specified Failed Financial Institution, etc., without obtaining the approval of the revolving mortgagor pertaining to a revolving mortgage for securing claims transferred through a business transfer (such mortgage is hereinafter referred to as a "Transferred Revolving Mortgage" in this Article and paragraphs (2) and (3) of the following Article, and such revolving mortgagor is hereinafter referred to as "Transferred Revolving Mortgagor" in this Article), may assign the Transferred Revolving Mortgage along with all of the claims to be secured thereby (hereinafter referred to as "Transferred Claims" in this Article) before the principal is fixed, through a business transfer to a Specified Bridge Financial Institution, etc. (meaning the Specified Bridge Financial Institution, etc. prescribed in Article 126-34, paragraph (3), item (v); the same shall apply in paragraph (7)) or any other Financial Institution, etc. (hereinafter referred to as "Bridge Financial Institution, etc." in this Article). In this case, notwithstanding the provisions of Article 398-4, paragraph (1) of said Code, it shall be deemed that an agreement has been reached between the Transferred Revolving Mortgagor and the Bridge Financial Institution, etc. that the Transferred Revolving Mortgage is to secure the Transferred Claims even after the assignment of the Transferred Revolving Mortgage.
(2) When a Transferred Revolving Mortgage is assigned along with all of the Transferred Claims before the principal is fixed pursuant to the preceding paragraph, and the Transferred Revolving Mortgage is to secure the Transferred Claims even after the assignment of the Transferred Revolving Mortgage, the Specified Failed Financial Institution, etc. and the Bridge Financial Institution, etc. shall, within two weeks of the day of said assignment, give public notice of the following matters and to the effect that any Transferred Revolving Mortgagor who has any objection thereto should demand that the principal secured be fixed within a specified period of time, and shall also give notice of the same individually to each Transferred Revolving Mortgagor:
(i) the fact that a Transferred Revolving Mortgage was assigned by the Specified Failed Financial Institution, etc. to the Bridge Financial Institution, etc.; and
(ii) the fact that the Transferred Revolving Mortgage is to secure Transferred Claims even after the assignment of the Transferred Revolving Mortgage.
(3) The period under the preceding paragraph cannot be less than one month.
(4) Notwithstanding the provisions of paragraph (2), if the Specified Failed Financial Institution, etc. and the Bridge Financial Institution, etc. give public notice under that paragraph by the method of public notice prescribed in the articles of incorporation, in addition to the official gazette, the Specified Failed Financial Institution, etc. and the Bridge Financial Institution, etc. shall not be required to give a separate notice under the provisions of that paragraph.
(5) When a Transferred Revolving Mortgage is assigned along with all of the Transferred Claims before the principal is fixed pursuant to paragraph (1), and the Transferred Revolving Mortgage is to secure the Transferred Claims even after the assignment of the Transferred Revolving Mortgage, the Transferred Revolving Mortgagor may demand that the principal secured be fixed; provided, however, that this shall not apply when the period prescribed in paragraph (2) has passed.
(6) When a demand is made under the preceding paragraph, the principal secured shall be deemed to have been fixed at the time of the business transfer pertaining to the Transferred Revolving Mortgage under paragraph (1) concerning the Transferred Revolving Mortgagor.
(7) The provisions of the preceding paragraphs shall apply mutatis mutandis to cases where a Specified Bridge Financial Institution, etc. intends to assign a revolving mortgage along with all of the claims to be secured thereby before the principal is fixed, through a business transfer to another Financial Institution, etc. In this case, necessary technical replacement of terms shall be specified by Cabinet Order.
(Special Provisions for Application Procedure for Registration of Revolving Mortgage Transfer, etc.)
Article 134 (1) An application for registration of a transfer of a revolving mortgage in the cases prescribed in Article 133, paragraph (4) (including the cases where it is applied mutatis mutandis pursuant to Article 133, paragraph (6)) shall be accompanied by information proving that public notice or individual notice was given and that the revolving mortgagors did not raise any objection within the period under paragraph (1) of the preceding Article (including the cases where it is applied mutatis mutandis pursuant to Article 133, paragraph (6)).
(2) An application for the registration of a transfer of a Transferred Revolving Mortgage in the cases prescribed in paragraph (1) of the preceding Article (including the cases where it is applied mutatis mutandis pursuant to paragraph (7) of said Article) shall be accompanied by information proving that the Specified Failed Financial Institution, etc. has carried out a business transfer under paragraph (1) of said Article.
(3) An application for the registration of alteration of a revolving mortgage or Transferred Revolving Mortgage to the effect of adding claims pertaining to transfer to the scope of claims to be secured by the revolving mortgage or Transfer Revolving Mortgage in the cases prescribed in Article 133, paragraph (4) of the preceding Article (including the cases where it is applied mutatis mutandis pursuant to Article 133, paragraph (6)) or paragraph (1) of the preceding Article (including the cases where it is applied mutatis mutandis pursuant to paragraph (7) of said Article) may be made by the revolving mortgagee alone when the application is accompanied by the information prescribed in the preceding two paragraphs.
(Special Provisions for Taxation)
Article 135 (1) The registration under Article 79 (including the cases where it is applied mutatis mutandis pursuant to Article 126-9) shall not be subject to the registration and license tax.
(2) In the event that a Bridge Bank has acquired any right relating to real property through the Assumption of Business, etc. of a Financial Institution under Management based on a decision specified in Article 91, paragraph (1), item (ii) under Article 91, paragraph (1) or (2) (referred to as "Assumption of Business, etc. Based on Decision" in the following paragraph) (limited to those that have been confirmed as appropriate assets to be held by said Bridge Bank under Article 93, paragraph (2)), the registration of said right relating to real property transfer shall not be subject to the registration and license tax, as long as such registration is made within one year from said acquisition as pursuant to the provisions of Ordinance of the Ministry of Finance.
(3) For the purpose of applying to a Bridge Bank, the provisions of Article 62-3, Article 63, Article 68-68, and Article 68-69 of the Act on Special Measures Concerning Taxation, the transfer of land or any right on land acquired through the Assumption of Business, etc. Based on Decision (limited to those that have been confirmed as appropriate assets to be held by said Bridge Bank under Article 93, paragraph (2)) (meaning the transfer prescribed in Article 62-3, paragraph (2), item (i), (a) of said Act) shall not constitute the transfer of land, etc. under Article 62-3, paragraph (2), item (i) of said Act.
(Submission of Reports or Materials)
Article 136 (1) The Prime Minister (in the case of a labor bank, a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc., the Prime Minister and the Minister of Health, Labour and Welfare, and in the case of The Shoko Chukin Bank, Ltd. or a Subsidiary, etc. of The Shoko Chukin Bank, the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry; the same shall apply in the following paragraph and the following Article) may, when he/she finds it necessary to ensure the smooth implementation of this Act, require a Financial Institution, etc. (including a Financial Institution Agent, etc. (meaning a Financial Institution Agent, Life Insurance Agent, Non-Life Insurance Agent, and Financial Instruments Intermediary Service Provider; the same shall apply in said paragraph, paragraph (1) of said Article, and Article 149, paragraph (1), item (ii), (a))) or Specified Holding Company, etc. to submit reports or materials with regard to the status of its business and property.
(2) The Prime Minister may, when and to the extent that he/she finds it particularly necessary to ensure the smooth implementation of this Act, require a Subsidiary, etc. of a Financial Institution, etc. or Subsidiary Company (meaning the subsidiary company prescribed in Article 2, item (iii) of the Companies Act; the same shall apply in the following paragraph, the following Article, and Article 139, paragraph (2), item (ii)) of the Financial Institution, etc. or Specified Holding Company, etc. or a person to whom business has been entrusted by the Financial Institution, etc. or Specified Holding Company, etc. (excluding a Financial Institution Agent, etc.; the same shall apply in the following paragraph and paragraphs (2) and (5) of the following Article) to submit reports or materials with regard to the status of business and property of said Financial Institution, etc. or Specified Holding Company, etc.
(3) A Subsidiary, etc. of a Financial Institution, etc. or Subsidiary Company of the Financial Institution, etc. or Specified Holding Company, etc., or a person to whom business has been entrusted by the Financial Institution, etc. or Specified Holding Company, etc. may, if there are justifiable grounds, refuse to submit reports or materials under the preceding paragraph.
(On-Site Inspection)
Article 137 (1) The Prime Minister may, when he/she finds it necessary to ensure the smooth implementation of this Act, authorize his/her officials to enter a business office (in the case of a Shinkin Bank, etc. or Mutual Company, an office, and in the case of a Foreign Insurance Company, etc., the branch office, etc. prescribed in Article 185, paragraph (1) of the Insurance Business Act) or any other facilities of a Financial Institution, etc. (including a Financial Institution Agent, etc.) or Specified Holding Company, etc. and ask questions on the status of its business and property or inspect books, documents, and other items.
(2) The Prime Minister may, when and to the extent he/she finds it particularly necessary in authorizing the entry, questioning, or inspection under the preceding paragraph, authorize said officials to enter the facilities of a Subsidiary, etc. of a Financial Institution, etc. or Subsidiary Company of the Financial Institution, etc. or Specified Holding Company, etc. or the person to whom business has been entrusted by the Financial Institution, etc. or Specified Holding Company, etc. and ask necessary questions concerning the questioning or inspection of said Financial Institution, etc. or Specified Holding Company, etc. or inspect books, documents, and other items.
(3) In the case referred to in the preceding two paragraphs, the officials shall carry a certificate of identification and produce it if requested by those concerned.
(4) The authority to conduct on-site inspections prescribed in paragraphs (1) and (2) shall not be construed as given for any criminal investigation.
(5) The provisions of paragraph (3) of the preceding Article shall apply mutatis mutandis to the questioning and inspection under paragraph (2) of a Subsidiary, etc. of a Financial Institution, etc. or Subsidiary Company of the Financial Institution, etc. or Specified Holding Company, etc.,or a person to whom business has been entrusted by the Financial Institution, etc. or Specified Holding Company, etc.
(6) The Prime Minister may, when he/she finds it necessary, authorize the Corporation to conduct the entry, questioning, or inspection (limited to those conducted to investigate the following matters) under paragraph (1) or (2); in this case, the Corporation shall authorize its officials to conduct said entry, questioning, or inspection:
(i) that the payment of insurance premiums under Article 50, paragraph (1) has been made appropriately;
(ii) that measures prescribed in Article 55-2, paragraph (4) and Article 58-3, paragraph (1) have been taken;
(iii) the expected amount of payment to be received for deposits and other claims prescribed in Article 71, paragraph (2); or
(iv) the status of execution of business and management and disposition of property by the Financial Institution, etc. necessary for ensuring the smooth implementation of Special Surveillance under the preceding Chapter and other operations under said Chapter, and operations incidental to said operations.
(7) The provisions of paragraph (3) to (5) shall apply mutatis mutandis to the entry, questioning, or inspection under the preceding paragraph.
(Notice of Commencement of Bankruptcy Proceedings of a Financial Institution, etc.)
Article 137-2 (1) When a ruling for the commencement of bankruptcy proceedings is made with respect to a Financial Institution, the court clerk shall notify to that effect the Prime Minister (in the case of a labor bank or federation of labor banks, the Prime Minister and the Minister of Health, Labour and Welfare, and in the case of The Shoko Chukin Bank, Ltd., the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry).
(2) In bankruptcy proceedings of a Financial Institution, when notice is given under Article 197, paragraph (1) of the Bankruptcy Act (including the cases where it is applied mutatis mutandis pursuant to Article 209, paragraph (3) of said Act) or Article 204, paragraph (2) of the Bankruptcy Act, or permission is granted under Article 208, paragraph (1) of said Act, a bankruptcy trustee shall notify the Corporation to that effect.
(Effect of Cancellation, etc. of a Contract)
Article 137-3 (1) When giving the Confirmation prescribed in Article 102, paragraph (1) or Specified Confirmation, the Prime Minister may, following deliberation by the Council, make a decision to the effect that a clause providing for Specified Cancellation, etc. of a contract (limited to a contract which agrees that Specified Cancellation, etc. will become effective based on the reason that a Related Measure, etc. (meaning said Confirmation or Specified Confirmation, Injunction Ordering Management, Designation of Special Surveillance, or Injunction Ordering Specified Management, or any other measure related to said Confirmation or Specified Confirmation; hereinafter the same shall apply in this paragraph and paragraph (4)) has been taken with regard to the Financial Institution or Financial Institution, etc. which is a party to the contract or a person specified in the contract, and which pertains to transactions specified by Cabinet Office Ordinance and Ordinance of the Ministry of Finance as those associated with financial market or any other financial system in Japan) based on the reason that a Related Measure, etc. has been taken with regard to the Financial Institution or Financial Institution, etc. pertaining to said Confirmation or Specified Confirmation shall not become effective during the period specified by the Prime Minister as a period necessary for implementing a business transfer or any other necessary measure for avoiding the risk of severe disruption being caused in the financial system in Japan, to the extent necessary for avoiding the risk of severe disruption being caused in the financial system in Japan (hereinafter referred to as the "Period for Implementing a Measure" in this Article).
(2) The "Specified Cancellation, etc." set forth in the preceding paragraph means termination or cancellation of a contract, arising of a right to cancel a contract, forfeiture of the benefit of time with regard to claims pertaining to a contract, the collective clearing prescribed in Article 2, paragraph (6) of the Act on Collective Clearing of Specified Financial Transaction Conducted by Financial Institutions, etc. (Act No. 108 of 1998) with regard to transactions pertaining to a contract, and other effects specified by Cabinet Office Ordinance and Ordinance of the Ministry of Finance as being equivalent thereto.
(3) A decision under paragraph (1) shall take effect as from the time of said decision.
(4) Upon making a decision under paragraph (1), the Prime Minister shall immediately give public notice of such fact and the Period for Implementing a Measure in the official gazette, and notify the Corporation and the Financial Institution or Financial Institution, etc. pertaining to the Related Measure, etc. subject to said decision of the same.
(5) During the Period for Implementing a Measure, the provisions of Article 58 of the Bankruptcy Act (including the cases where it is applied mutatis mutandis pursuant to Article 51 of the Civil Rehabilitation Act, Article 63 of the Corporate Reorganization Act, and Article 41, paragraph (3) and Article 206, paragraph (3) of the Act on Special Treatment of Corporate Reorganization Proceedings and Other Insolvency Proceedings of Financial Institutions) shall not apply to the contract for which a decision under paragraph (1) has been made.
(6) With regard to application of the provisions of Article 3 of the Act on Collective Clearing of Specified Financial Transaction Conducted by Financial Institutions, etc., to a contract for which a decision under paragraph (1) has been made, during the Period for Implementing a Measure, the grounds for collective clearing prescribed in Article 2, paragraph (4) of said Act shall be deemed to have not arisen.
(Order for Smoothly Implementing the Orderly Resolution of Assets and Liabilities of Financial Institution, etc.)
Article 137-4 The Prime Minister (in the event that the Financial Institution, etc. pertaining to the order prescribed in this Article is a labor bank, a federation of labor banks, or a Subsidiary, etc. of a Labor Bank, etc., the Prime Minister and the Minister of Health, Labour and Welfare, and in the case where it is The Shoko Chukin Bank, Ltd. or a Subsidiary, etc. of The Shoko Chukin Bank, the Prime Minister, the Minister of Finance, and the Minister of Economy, Trade and Industry) may, when a need for orderly resolution of assets and liabilities of the Financial Institution, etc. arises and he/she finds that measures necessary for the smooth implementation thereof have not been taken, order the Financial Institution, etc. to take said measures to the extent necessary, by a specified time.
(International Cooperation)
Article 137-5 The Corporation shall, when there is a need to carry out the operations thereof under international cooperation, carry out exchange of information with foreign governments, foreign local public entities, foreign central banks, international organizations, and other bodies equivalent thereto and other necessary operations.
(Delegation to Cabinet Order)
Article 138 In addition to what is provided for in this Act, necessary matters for the implementation of this Act shall be specified by Cabinet Order.
(Delegation of Authority)
Article 139 (1) The Prime Minister shall delegate the authority under this Act to the Commissioner of the Financial Services Agency, except those specified below:
(i) appointment under Article 26, paragraph (1) or (2);
(ii) dismissal under Article 26, paragraph (3) or Article 29;
(iii) approval under Article 30; and
(iv) any other matter specified by Cabinet Order.
(2) The Commissioner of the Financial Services Agency may delegate the following authority that has been delegated under the preceding paragraph to the Securities and Exchange Surveillance Commission:
(i) the authority prescribed in Article 136, paragraph (1) and Article 137, paragraph (1) (limited to that concerning the financial instruments business operator prescribed in Article 2, paragraph (9) of the Financial Instruments and Exchange Act, Designated Parent Company, Subsidiary Specified Juridical Person of Financial Instruments Business Operator, Subsidiary Company, etc. of a Designated Parent Company, and Securities Finance Company (referred to as a "Financial Instruments Business Operator, etc." in the following item) and those concerning a Financial Instruments Intermediary Service Provider and the registered financial institution prescribed in Article 2, paragraph (11) of said Act (limited to that pertaining to the acts specified in the items of said paragraph conducted on behalf of the Financial Instruments Business Operator prescribed in said paragraph under the entrustment from said Financial Instruments Business Operator));
(ii) the authority prescribed in Article 136, paragraph (2) and Article 137, paragraph (2) (limited to that concerning a Subsidiary Specified Juridical Person of Financial Instruments Business Operator, Subsidiary Company, etc. of a Designated Parent Company, Subsidiary Company of a Financial Instruments Business Operator, etc., or a person to whom business has been entrusted by a Financial Instruments Business Operator, etc.); and
(iii) any other authority specified by Cabinet Order.
(3) When the Securities and Exchange Surveillance Commission exercises the authority that has been delegated under the preceding paragraph, it shall promptly report the results thereof to the Commissioner of the Financial Services Agency.
(4) The Commissioner of the Financial Services Agency may, pursuant to the provisions of Cabinet Order, delegate part of the authority that has been delegated under paragraph (1) (excluding the authority that has been delegated to the Securities and Exchange Surveillance Commission under paragraph (2)) to the Director-Generals of Local Finance Bureaus or Director-Generals of Local Finance Branch Bureaus.
(5) The Securities and Exchange Surveillance Commission may, pursuant to the provisions of Cabinet Order, delegate part of the authority that has been delegated under paragraph (2) to the Director-Generals of Local Finance Bureaus or Director-Generals of Local Finance Branch Bureaus.
(6) With regard to affairs pertaining to the authority delegated to the Director-Generals of Local Finance Bureaus or Director-Generals of Local Finance Branch Bureaus under the preceding paragraph, the Securities and Exchange Surveillance Commission shall direct and supervise the Director-Generals of Local Finance Bureaus or Director-Generals of Local Finance Branch Bureaus.
(Appeal to the Securities and Exchange Surveillance Commission)
Article 139-2 An appeal under the Administrative Appeal Act (Act No. 160 of 1962) with regard to an order to submit reports or materials given by the Securities and Exchange Surveillance Commission pursuant to paragraph (2) of the preceding Article (including the cases where such order is given by the Director-Generals of Local Finance Bureaus or Director-Generals of Local Finance Branch Bureaus pursuant to paragraph (5) of said Article) may be filed with the Securities and Exchange Surveillance Commission alone.
(Transitional Measures)
Article 140 When enacting, revising or abolishing an order pursuant to this Act, necessary transitional measures (including transitional measures concerning penal provisions) may be provided for by that order, to the extent considered reasonably necessary for its enactment, revision or abolition.
Chapter IX Penal Provisions
Article 141 (1) Any financial administrator or financial administrator representative who has accepted, solicited, or promised to accept a bribe in connection with his/her duties shall be punished by imprisonment with work for not more than three years or a fine of up to one million yen.
(2) When a financial administrator or financial administrator representative is a corporation, any officer or staff member of such financial administrator or financial administrator representative who has accepted, solicited, or promised to accept a bribe in connection with his/her duties shall be punished by imprisonment with work for not more than three years or a fine of up to one million yen. The same shall apply when, in the event that a financial administrator or financial administrator representative is a corporation, any officer or staff thereof has caused the financial administrator or financial administrator representative to accept, solicit an offer of or promise of a bribe in connection with the duties of a financial administrator or financial administrator representative.
(3) Any bribe accepted by an offender or financial administrator or financial administrator representative who is a corporation shall be confiscated. If it is not possible to confiscate the whole or part of the bribe, an equivalent value thereof shall be collected.
Article 141-2 (1) Any Special Surveillance Agent or Corporation Representative who has accepted, solicited, or promised to accept a bribe in connection with his/her duties shall be punished by imprisonment with work for not more than three years or a fine of up to one million yen.
(2) When a Special Surveillance Agent or Corporation Representative is a corporation, any officer or staff member of such Special Surveillance Agent or Corporation Representative who has accepted, solicited, or promised to accept a bribe in connection with his/her duties shall be punished by imprisonment with work for not more than three years or a fine of up to one million yen. The same shall apply when, in the event that a Special Surveillance Agent or Corporation Representative is a corporation, any officer or staff thereof has caused the Special Surveillance Agent or Corporation Representative to accept or solicit an offer of or promise of a bribe in connection with the duties of the Special Surveillance Agent or Corporation Representative.
(3) Any bribe accepted by an offender or Special Surveillance Agent or Corporation Representative who is a corporation shall be confiscated. If it is not possible to confiscate the whole or part of the bribe, an equivalent value thereof shall be collected.
Article 142 Any person who has given, or offered or promised to give the bribe prescribed in Article 141, paragraph (1) or (2) or paragraph (1) of the preceding Article shall be punished by imprisonment with work for not more than three years or a fine of up to one million yen.
Article 142-2 In the event that any of the following violations has been committed, the person who has committed said violation shall be punished by imprisonment with work for not more than one year or a fine of up to three million yen, or both:
(i) violation of an order under Article 126-3, paragraph (3); or
(ii) violation of an order under Article 126-17.
Article 143 (1) Any person who has failed to submit reports or materials under Article 136, paragraph (1) or (2) or submitted false reports or materials shall be punished by an imprisonment with work for not more than one year or a fine of up to three million yen.
(2) The provisions of the preceding paragraph shall apply to any person who has refused to answer questions or given false answers to the officials or staff of the Corporation under Article 137, paragraph (1), (2) or (6) or has refused, obstructed, or avoided any inspection under these provisions.
Article 144 Any person who has divulged any secret which may have come to his/her knowledge in the course of his/her duties in violation of the provisions of Article 22 (including the cases where it is applied mutatis mutandis pursuant to Article 33) or Article 82 (including the cases where it is applied mutatis mutandis pursuant to Articles 126-9 and 126-18) shall be punished by an imprisonment with work for not more than one year or a fine of not more than five hundred thousand yen.
Article 145 (1) Any director, executive officer, member who executes business (in the event that the member who executes business is a corporation, a member who is to perform the duties of the member who executes business), representative in Japan, accounting advisor (in the event that the accounting advisor is a corporation, a member who is to perform the duties of the accounting advisor), inspector, corporate auditor, or a person equivalent to any of these, accounting auditor (in the event that the accounting auditor is a corporation, a member who is to perform the duties of the corporate auditor), any manager, counselor, or any other employee of a Failed Financial Institution or Financial Instituion, etc. under Special Surveillance, a Financial Institution Agent having said Failed Financial Institution as its Principal Financial Institution or the other party to contracts pertaining to the agency or intermediary prescribed in Article 2, paragraph (4) of The Shoko Chukin Bank Limited Act of The Shoko Chukin Bank, Ltd (limited to the case where it is the Failed Financial Institution) or a Financial Institution Agent having a Financial Institution, etc. under Special Surveillance as its Principal Financial Institution, the other party to contracts pertaining to the agency or intermediary prescribed in said paragraph of The Shoko Chukin Bank, Ltd (limited to the case where it is the Financial Institution, etc. under Special Surveillance), a Life Insurance Agent or Non-Life Insurance Agent having a Financial Institution, etc. under Special Surveillance as its Affiliated Insurance Company, etc., or a Financial Instruments Intermediary Service Provider having a Financial Institution, etc. under Special Surveillance as its Entrusting Financial Instruments Business Operator, etc. (in the event that these persons are corporations, any of their officers and employees), or a person who previously held any of these positions has failed to submit reports or submitted false reports under Article 37, paragraph (3) or refused, obstructed, or avoided any inspection under Article 37, paragraph (3) shall be punished by an imprisonment with work for not more than one year or a fine of not more than five hundred thousand yen.
(2) The provisions of the preceding paragraph shall apply to any director, executive officer, accounting advisor (in the event that the accounting advisor is a corporation, a member who is to perform the duties of the accounting advisor), corporate auditor, accounting auditor (in the event that the accounting auditor is a corporation, a member who is to perform the duties of the corporate auditor), inspector, manager, counselor, or any other employee of a Financial Institution under Management, a Financial Institution Agent having the Financial Institution under Management as its Principal Financial Institution or the other party to contracts pertaining to the agency or intermediary prescribed in Article 2, paragraph (4) of The Shoko Chukin Bank Limited Act of The Shoko Chukin Bank, Ltd (limited to the case where it is the Financial Institution under Management) (in the event that these persons are corporations, any of their officers and employees), or a person who previously held any of these positions who has failed to submit reports or submitted false reports under Article 81, paragraph (1) or refused, obstructed, or avoided any inspection under said paragraph.
Article 146 Any person who falls under any of the following items shall be punished by a fine of not more than five hundred thousand yen:
(i) any person who has failed to submit reports or submitted false reports under Article 64-2, paragraph (5) (including the cases where it is applied mutatis mutandis pursuant to Article 68-2, paragraph (5) (including the cases where it is applied mutatis mutandis pursuant to Article 69, paragraph (4), Article 101, paragraph (7), Article 126-31, Article 126-32, paragraph (4), and Article 126-38, paragraph (7)), Article 68-3, paragraph (5) (including the cases where it is applied mutatis mutandis pursuant to Article 69, paragraph (4), Article 101, paragraph (7), Article 126-31, Article 126-32, paragraph (4), and Article 126-38, paragraph (7)), Article 69, paragraph (4), Article 101, paragraph (7), Article 126-31, Article 126-32, paragraph (4), and Article 126-38, paragraph (7)), Article 100 (including the cases where it is applied mutatis mutandis pursuant to Article 126-37), Article 108, paragraph (2) (including the cases where it is applied mutatis mutandis pursuant to Article 108-2, paragraph (4) (including the cases where it is applied mutatis mutandis pursuant to Article 108-3, paragraph (8)) and Article 108-3, paragraph (8)), or Article 126-24, paragraph (2) (including the cases where it is applied mutatis mutandis pursuant to Article 126-25, paragraph (4) (including the cases where it is applied mutatis mutandis pursuant to Article 126-26, paragraph (8)) and Article 126-26, paragraph (8)); or
(ii) any person who has failed to submit reports or materials under Article 80, Article 115, Article 126-3, paragraph (5), or Article 126-8 or has submitted false reports or materials.
Article 147 Any officer or employee of the Corporation who has committed any of the following violations shall be punished by a fine of not more than five hundred thousand yen:
(i) when he/she has failed to submit reports or submitted false reports under Article 46, paragraph (1) or has refused, obstructed or avoided any inspection under Article 46, paragraph (1); or
(ii) when he/she has failed to submit reports or submitted false reports under Article 56, paragraph (4) (including the cases where it is applied mutatis mutandis pursuant to Article 57, paragraph (5) and Article 72, paragraph (5)), Article 64, paragraph (3) (including the cases where it is applied mutatis mutandis pursuant to Article 69, paragraph (4), Article 69-3, paragraph (2) (including the cases where it is applied mutatis mutandis pursuant to Article 127 and Article 128), Article 101, paragraph (7), Article 118, paragraph (4), Article 126-31, Article 126-32, paragraph (4), Article 126-38, paragraph (7), Article 127-2, paragraph (2), and Article 128-2, paragraph (2)), Article 92, paragraph (3), Article 96, paragraph (3) (including the cases where it is applied mutatis mutandis pursuant to Article 126-37), Article 97, paragraph (2) (including the cases where it is applied mutatis mutandis pursuant to Article 126-37), Article 98, paragraph (2) (including the cases where it is applied mutatis mutandis pursuant to Article 126-37), Article 101-2, paragraph (4), Article 107, paragraph (2) (including the cases where it is applied mutatis mutandis pursuant to Article 126-22, paragraph (7)), Article 109, paragraph (2), Article 120, paragraph (4), Article 123, paragraph (1), Article 126-27, paragraph (2), Article 126-35, paragraph (3), or Article 129, paragraph (4).
Article 148 Any person who falls under any of the following items shall be punished by a fine of not more than three hundred thousand yen:
(i) a person who has failed to submit reports or materials under Article 37, paragraph (1) or has submitted false reports or materials; or
(ii) a person who has failed to submit materials under Article 55-2, paragraph (2) or has submitted false materials.
Article 149 (1) When a representative (including an administrator of an Association Without Legal Personality, etc.) of a corporation (including an association or foundation which is not a corporation but for which a representative or an administrator has been designated (hereinafter referred to as an "Association Without Legal Personality, etc." in this Article); hereinafter the same shall apply in this paragraph) or an agent, employee, or other worker of a corporation or individual has committed any violation specified in each of the following items with regard to the business or property of such corporation or individual, not only the offender shall be punished, but also said corporation shall be punished by the fine set forth in each respective item and said individual shall be punished by the fine prescribed in the respective Articles:
(i) Article 142-2 or Article 143: a fine of not more than two hundred million yen; and
(ii) Article 145 (limited to the part pertaining to the following persons), Article 146 or Article 148: the fine prescribed in the respective Articles:
(a) Financial Institution Agent, etc. (limited to corporations);
(b) member who executes business (limited to corporations);
(c) accounting advisor (limited to corporations); or
(d) accounting auditor (limited to corporations).
(2) In the event that the provisions of the preceding paragraph apply to an Association Without Legal Personality, etc., its representative or administrator shall represent the Association Without Legal Personality, etc. in its procedural action, and the provisions of Acts concerning criminal procedure in the cases where a corporation is accused or suspected shall be applied.
Article 150 (1) The crimes set forth in Article 141 or Article 141-2 shall apply to any person who has committed these crimes outside Japan.
(2) The crimes set forth in Article 142 (limited to the part pertaining to Article 141, paragraph (1) or (2)) shall be governed by Article 2 of the Penal Code.
Article 151 (1) Any director, executive officer, member who executes business (in the event that the member who executes business is a corporation, a member who is to perform the duties of the member who executes business), representative in Japan, or a person equivalent to any of these of a Financial Institution, etc. or Specified Holding Company, etc. who has committed any of the following violations shall be punished by a non-criminal fine of not more than one million yen; provided, however, that this shall not apply when such act should be made subject to a criminal punishment:
(i) when he/she has failed to give public notice, report, notice or demand prescribed in this Act or has given unauthorized public notice, report, or notice;
(ii) when he/she has violated an order under Article 58-3, paragraph (2) or Article 137-4;
(iii) when he/she has failed to make submission or has made false submission pursuant to the provision of Article 68-2, paragraph (4) or Article 68-3, paragraph (4) (including the cases where these provisions are applied mutatis mutandis pursuant to Article 69, paragraph (4), Article 101, paragraph (7), Article 126-31, Article 126-32, paragraph (4), and Article 126-38, paragraph (7)), Article 108-2, paragraph (3) (including the cases where it is applied mutatis mutandis pursuant to Article 108-3, paragraph (8)), Article 108-3, paragraph (3) (including the cases where it is applied mutatis mutandis pursuant to Article 108-3, paragraph (4)), Article 108-3, paragraph (7), Article 126-25, paragraph (3) (including the cases where applied mutatis mutandis pursuant to Article 126-26, paragraph (8)), Article 126-26, paragraph (3) (including the cases where it is applied mutatis mutandis pursuant to paragraph (4) of said Article) or paragraph (7) of said Article;
(iv) when he/she has failed to make registration in violation of the provisions of Article 107-3, paragraph (2) (including the cases where applied mutatis mutandis pursuant to Article 126-22, paragraph (7)) or Article 107-4, paragraph (2) (including the cases where applied mutatis mutandis pursuant to Article 126-22, paragraph (7));
(v) when he/she has committed any act prescribed in Article 108-2, paragraph (1) (including the cases where it is applied mutatis mutandis pursuant to Article 108-3, paragraph (8)), Article 108-3, paragraph (1) (including the cases where it is applied mutatis mutandis pursuant to Article 108-3, paragraph (4)) or Article 108-3, paragraph (5), Article 126-25, paragraph (1) (including the cases where it is applied mutatis mutandis pursuant to Article 126-26, paragraph (8)) or Article 126-26, paragraph (1) (including the cases where it is applied mutatis mutandis pursuant to paragraph (4) of said Article) or paragraph (5) of said Article without the authorization of the Prime Minister prescribed in these provisions;
(vi) when he/she has failed to provide notification or provided false notification in violation of the provisions of Article 74, paragraph (5);
(vii) when he/she fails to transfer affairs to a financial administrator who has been appointed under Article 77, paragraph (2) or to the Corporation in the event that a Injunction Ordering Specified Management has been issued pursuant to Article 126-5, paragraph (1); or
(viii) when he/she has failed to make payment, provide security, or entrust property under Article 131, paragraph (8).
(2) When a financial administrator or the Corporation in the event that a Injunction Ordering Specified Management has been issued fails to transfer his/her affairs to a director, executive officer, member who executes business, representative in Japan, or liquidator of a Financial Institution under Management or a Financial Institution, etc. subject to the Injunction Ordering Specified Management despite the rescission of a Injunction Ordering Management or Injunction Ordering Specified Management under Article 75 or Article 126-7, such financial administrator or the Corporation in the event that a Injunction Ordering Specified Management has been issued shall be punished by a non-criminal fine of not more than one million yen; provided, however, that this shall not apply when a criminal punishment should be imposed for the act in question.
(3) A financial administrator of the Financial Institutions specified in items (i) through (vii) or the Corporation in the event that a Injunction Ordering Specified Management has been issued for the Financial Institution, etc. specified in each of the following items shall be punished by a non-criminal fine of not more than one million yen if he/she falls under any of the provisions prescribed in each respective item; provided, however, that this shall not apply when a criminal punishment should be imposed for the act in question:
(i) a Bank: each item of Article 976 of the Companies Act or each item of Article 65 of the Banking Act;
(ii) a Long-Term Credit Bank: each item of Article 976 of the Companies Act or each item of Article 27 of the Long-Term Credit Bank Act;
(iii) a Financial Institution that conducts trust business under Article 1, paragraph (1) of the Act on Provision, etc. of Trust Business by Financial Institutions: each item of Article 22 of said Act;
(iv) a shinkin bank or federation of shinkin banks: each item of Article 91, paragraph (1) of the Shinkin Bank Act;
(v) a credit cooperative or Federation of Credit Cooperatives: each item of Article 12, paragraph (1) of the Act on Financial Business by Cooperatives;
(vi) a labor bank or federation of labor banks: each item of Article 101, paragraph (1) of the Labor Bank Act;
(vii) The Shoko Chukin Bank, Ltd.: each item of Article 976 of the Companies Act or Article 76 of The Shoko Chukin Bank Limited Act;
(viii) Foreign Bank Branch: each item of Article 976 of the Companies Act or each item of Article 65 of the Banking Act;
(ix) Insurance Company or Foreign Insurance Company, etc.: each item of Article 976 of the Companies Act or each item of Article 333, paragraph (1) and each item of Article 334 of the Insurance Business Act; or
(x) Financial Institution, etc. that is a company (excluding those set forth in items (i) through (iii) and item (vii) through the preceding item): each item of Article 976 of the Companies Act.
(4) When the Corporation in the event that a Injunction Ordering Specified Management has been issued for a Financial Instruments Business Operator, Designated Parent Company, or Securities Finance Company falls under any item of Article 208 of the Financial Instruments and Exchange Act, the Corporation shall be punished by a non-criminal fine of not more than three hundred thousand yen; provided, however, that this shall not apply when a criminal punishment should be imposed for the act in question.
(5) A financial administrator of a credit cooperative or Federation of Credit Cooperatives or the Corporation in the event that a Injunction Ordering Specified Management has been issued for a credit cooperative or Federation of Credit Cooperatives that falls under any item of Article 115, paragraph (1) of the Small and Medium-Sized Enterprises Cooperatives Act shall be punished by a non-criminal fine of not more than two hundred thousand yen; provided, however, that this shall not apply when a criminal punishment should be imposed for the act in question.
Article 152 Any officer of the Corporation who falls under any of the following items shall be punished by a non-criminal fine of not more than two hundred thousand yen:
(i) when he/she is required under this Act to obtain the authorization or approval of the Prime Minister and the Minister of Finance but has failed to obtain such authorization or approval;
(ii) when he/she has failed to make registration in violation of the Cabinet Order prescribed in Article 7, paragraph (1);
(iii) when he/she has carried out operations other than those prescribed in Article 34;
(iv) when he/she has failed to keep documents or make them available for public inspection in violation of the provisions of Article 40, paragraph (3);
(v) when he/she has failed to calculate or set aside a liability reserve in violation of the provisions of Article 41;
(vi) when he/she has invested surplus funds from operations in violation of the provisions of Article 43;
(vii) when he/she has violated an order of the Prime Minister and the Minister of Finance under Article 45, paragraph (2); or
(viii) when he/she has failed to submit reports or submitted false reports under Article 55, paragraphs (3) and (4), Article 59, paragraph (7) (including the cases where it is applied mutatis mutandis pursuant to Article 59-2, paragraph (3) (including the cases where it is applied mutatis mutandis pursuant to Article 69, paragraph (4)), Article 69, paragraph (4), Article 101, paragraph (5) and Article 118, paragraph (2)), Article 60, paragraph (3) (including the cases where it is applied mutatis mutandis pursuant to Article 126-31), Article 61, paragraph (7) (including the cases where it is applied mutatis mutandis pursuant to Article 62, paragraph (4) (including the cases where it is applied mutatis mutandis pursuant to Article 101, paragraph (7) and Article 118, paragraph (4)), Article 101, paragraph (5) and Article 118, paragraph (2)), Article 66, paragraph (4) (including the cases where it is applied mutatis mutandis pursuant to Article 101, paragraph (7), Article 118, paragraph (4), Article 126-31, and Article 126-38, paragraph (7)), Article 120, paragraph (3), Article 126-28, paragraph (8) (including the cases where it is applied mutatis mutandis pursuant to Article 59-2, paragraph (3) as applied mutatis mutandis to Article 126-31 and Article 126-32, paragraph (4); Article 126-32, paragraph (4); and Article 126-38, paragraph (5)), Article 126-29, paragraph (7) (including the cases where applied mutatis mutandis pursuant to Article 62, paragraph (4) as applied mutatis mutandis pursuant to Article 126-31), or Article 126-29, paragraph (7) as applied mutatis mutandis pursuant to Article 126-38, paragraph (5) (including the cases where it is applied mutatis mutandis pursuant to Article 62, paragraph (4) as applied mutatis mutandis pursuant to Article 126-38, paragraph (7)).
Article 153 Any person who has violated the provisions of Article 6, paragraph (2) shall be punished by a non-criminal fine of not more than two hundred thousand yen.