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Process and timing
Is the notification process voluntary or mandatory?
If the filing requirements (ie, the filing thresholds) are met, filing is mandatory. The participating company that is required to file depends on the type of transaction.
What timing requirements apply when filing a notification?
A notification may be filed if all necessary information is available and the participating companies have decided to proceed with the business combination, even before execution of the final agreement. If the notification is filed too early before the scheduled closing date and the market information at the time of closing materially changes, the Japan Fair Trade Commission may request supplementary information and extend the waiting period, or require the filing of a new report with a new waiting period. However, if there are no material changes in the market, the participating companies may close the transaction on submitting a report of changes after the first filing. In addition, the participating companies’ most recent financial data may be required to be filed if it becomes available after expiry of the waiting period.
What form should the notification take? What content is required?
The Japan Fair Trade Commission has prescribed the format for notification depending on the type of transaction. A company which is required to file must complete the notification in the prescribed format in Japanese, including the necessary information and attaching certain prescribed documents (eg, the articles of incorporation, a copy of the agreements, minutes of the meetings of appropriate corporate organisations and financial reports), alongside a Japanese translation (or at least a Japanese summary of the relevant parts) thereof.
Is there a pre-notification process before formal notification, and if so, what does this involve?
There is no mandatory process before filing of formal notification. With regard to a pre-notification process, the Japan Fair Trade Commission (JFTC) usually responds to questions regarding filing, such as in relation to the need to file under the Anti-monopoly Law.
A company that plans a business combination may consult with the JFTC in advance regarding the necessary notification under the relevant guidelines. During that process the participating companies provide, and the JFTC collects, information necessary for the JFTC’s formal review, including materials for the substantive analysis.
The JFTC's formal review of the business combination starts after the JFTC has formally accepted the filing. Thus, while the JFTC starts its review and communications with the participating companies before it has formally accepted the filing, it never informs the companies of its opinion on the substantive issues before the filing and such interactions do not bind the JFTC after filing of the notification. Further, such prior consultation is not mandatory.
Informal prior consultation with the JFTC is also available for business combinations for which filing is not required. In such case the JFTC provides the party companies with its formal opinion regarding substantive issues without filing.
Please see "Policies Concerning Procedures of Review of Business Combination" (JFTC guidelines, June 14 2011) for more details.
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