The government of Japan, on Monday, states that high-technology businesses will be included in the list of Japanese firms where foreign ownership has been limited.
To be in effect from the 1st of August, this new regulation has come following the increased pressure from the US concerning cyber-security dangers and technological transfers consisting of China.
The government of Japan did not specify the nations or the firms that will directly be affected by the application of foreign ownership limitations to the telecoms/IT firms.
The statement was made on the very same day that the President of the United States, Donald Trump, and the Prime Minister of Japan, Shinzo Abe, are holding dialogues in Tokyo relating to trade and other matters.
The US has stated that Huawei Technologies may be utilized by Beijing in order to spy on the West and has strictly cautioned nations against using Chinese technology. These allegations have been strongly rejected by both China and Huawei.
Japanese ministries stated how they have decided to add integrated circuit manufacturing as well as take other compulsory steps following the increased significance of ensuring cybersecurity in preceding years.
A joint statement by the finance, trade, and communications ministry stated that twenty sectors in information and communications industries will be subjected to this new regulation.
Japan brings industries for example airplane industry, nuclear-related areas and arms manufacturing under foreign capital controls, following the foreign trade control and the foreign exchange law.
According to the law, foreign investors are needed to report to the government of Japan and also go through an inspection if they intend to buy 10 percent (or more than 10 percent) of stocks from the listed Japanese firms or in case they obtain shares of companies that are unlisted.
In case the government comes across any inadequacies, it has a right to ask the foreign investors to alter or completely cancel their plans for investment.