Rules Concerning
Type II Business Internal Control Supervisory Manager, etc.
(Purpose)
Article 1.
The purpose of these Rules is to contribute to proper execution of business activities
relating to Self-Offering and Other Transactions, etc. (referring to the Self-Offering andOther Transactions, etc. set forth in Item (9) of Article 3 of the Articles of Incorporation;
the same shall apply hereinafter) conducted by Regular Members and Electronic Public
Offering Members, by tightening Regular Members’ and Electronic Public Offering
Members’ attitude toward internal control through prescribing rules regarding suchmatters as registration and duties of the officers, etc. engaging in the work of supervising
the situation of compliance with the Financial Instruments and Exchange Act (hereinafterreferred to as “FIEA”), other laws and regulations, as well as the Articles ofIncorporation and other rules (including the detailed regulations, guidelines, resolutions,etc. thereunder; hereinafter referred to as the “Laws and Regulations, etc.”).
(Registration of Type II Business Internal Control Supervisory Manager)
Article 2.
1. Each Regular Member and Electronic Public Offering Member must designate one
individual as Type II Business Internal Control Supervisory Manager pertaining toSelf-Offering and Other Transactions, etc., and submit to the Association a written
notification thereof in a prescribed form without delay.
2. If there was any change to the contents of the notification referred to in the preceding
Paragraph, the relevant Regular Member or Electronic Public Offering Member must
submit to the Association a written notification of change in a prescribed form
without delay.
3. When Regular Member or Electronic Public Offering Member made the notification
pursuant to the provisions of preceding two Paragraphs, the Association must register
the Type II Business Internal Control Supervisory Manager in Type II Business
Internal Control Supervisory Manager register.
(Qualification Requirements of Type II Business Internal Control SupervisoryManager)
Article 3.
Regular Member’s and Electronic Public Offering Member’s Type II Business Internal
Control Supervisory Manager must be a registered officer who is in charge of internal
control pertaining to Self-Offering and Other Transactions, etc. (in the case of Regular
Member or Electronic Public Offering Member that is a foreign corporation, a person1who has authority equivalent to that of such officer); provided, however, that theforegoing shall not apply if the person prescribed in the relevant detailed regulations is tobe appointed as Type II Business Internal Control Supervisory Manager.
(Responsibilities of Type II Business Internal Control Supervisory Manager)
Article 4.
1. Type II Business Internal Control Supervisory Manager him/herself must comply
with Laws and Regulations, etc., and strive to enhance the attitude toward internal
control by making the officers and employees of the relevant Regular Member orElectronic Public Offering Member thoroughly maintain the business stance incompliance with Laws and Regulations, etc. so that business activities, such as
solicitation of investment, and customer management shall be properly conducted.
2. In order to make sure that business activities, such as solicitation of investment, ofRegular Member or Electronic Public Offering Member are properly conducted incompliance with Laws and Regulations, etc., if a situation has occurred in which anofficer or employee of the relevant Regular Member or Electronic Public Offering
Member violated Laws and Regulations, etc., Type II Business Internal Control
Supervisory Manager must appropriately dispose of such situation in light of Lawsand Regulations, etc.
3. Type II Business Internal Control Supervisory Manager must properly communicate
and coordinate with the administrative authorities, the Association and other selfregulatory organizations regarding compliance with Laws and Regulations, etc. in thebusiness activities, such as solicitation of investment, of the relevant Regular Member
or Electronic Public Offering Member.
4. In the event a material issue has arisen in relation to the business activities, such as
solicitation of investment, or customer management of the relevant Regular Member
or Electronic Public Offering Member, Type II Business Internal Control Supervisory
Manager must promptly report its details to its Member Representative (in the case ofRegular Member, Member Representative or Member Representative’s deputy; thesame shall apply in the following Article).
(Instruction to Type II Business Internal Control Supervisory Manager)
Article 5.
1. Member Representative must take care so that Type II Business Internal Control
Supervisory Manager can perform his/her duties appropriately.
2. When Member Representative received a report from Type II Business Internal
Control Supervisory Manager pursuant to the provision of Paragraph 4 of thepreceding Article, he/she must provide appropriate instruction.

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(Placement, etc. of Type II Business Business Manager and Type II Business
Internal Control Manager)
Article 6.
1. In order to appropriately conduct business activities, such as solicitation ofinvestment, and customer management pertaining to Self-Offering and OtherTransactions, etc., each Regular Member and Electronic Public Offering Member
must place, as Type II Business Business Manager and Type II Business Internal
Control Manager, at least one individual, who is its officer or employee withsufficient knowledge and experience regarding Laws and Regulations, etc., in each ofsuch positions in accordance with the actual state of affairs of the business activities
pertaining to the relevant Self-Offering and Other Transactions, etc.
2. Type II Business Business Manager must comply with Laws and Regulations, etc.
him/herself, make the officers and employees who execute Self-Offering and OtherTransactions, etc., for which he/she has been appointed as such manager, thoroughly
maintain the business stance to comply with Laws and Regulations, etc., and guideand supervise them so that business activities, such as solicitation of investment, andcustomer management shall be properly conducted.
3. Type II Business Internal Control Manager must comply with Laws and Regulations,etc. him/herself, and exercise appropriate internal control by, for example, always
inspecting whether the business activities pertaining to Self-Offering and Other
Transactions, etc., for which he/she has been appointed as such manager, arecomplying with Laws and Regulations, etc. and properly executed.
4. Type II Business Business Manager and Type II Business Internal Control Manager
must—in the event a material issue has arisen in relation to the business activities,
such as solicitation of investment, or customer management, for which they havebeen appointed as such managers—promptly report its details to Type II Business
Internal Control Supervisory Manager and receive his/her instructions.
5. Regular Member’s and Electronic Public Offering Member’s Type II Business
Internal Control Supervisory Manager may concurrently serve as Type II Business
Internal Control Manager if the Association has specifically permitted it in response
to such conditions as the number of business office and the personnel placement ofthe relevant Regular Member or Electronic Public Offering Member.
(Attendance at Training)
Article 7.
1. Each Regular Member and Electronic Public Offering Member must make its Type II
Business Internal Control Supervisory Manager attend the designated training which
is provided by the Association in each Business Year of the Association (referring tothe Business Year prescribed in Article 53 of the Articles of Incorporation); provided,
however, that the Type II Business Internal Control Supervisory Manager who is3

prescribed in the relevant detailed regulations shall be exempted from attending suchtraining.
2. Each Regular Member and Electronic Public Offering Member must make its Type II
Business Business Manager and Type II Business Internal Control Manager attend
required internal training regularly; provided, however, that the person who has
attended the designated training provided by the Association may be exempted fromattending such internal training.
(Making Placement Status Report to the Association)
Article 8.
Each Regular Member and Electronic Public Offering Member must report the status ofits placement of Type II Business Business Manager and Type II Business Internal
Control Manager as of the end of July of each year to the Association without delay.
(Detailed Regulations)
Article 9.
Matters that are necessary in relation to Type II Business Internal Control Supervisory
Manger, etc. shall be determined in accordance with the relevant detailed regulations.

Supplementary Provisions (May 20, 2011)(Effective Date)
Article 1.
These Rules shall become effective from the date on which the Association is certified by
the Prime Minister as Financial Instruments Firms Association provided for in Article 78,
Paragraph 1 of FIEA (June 30, 2011).
(Transitional Measure)
Article 2.
Notwithstanding the provision of the preceding Article, the provisions of Article 6,
Article 7 and Article 8 shall become applicable from April 1, 2012.
Supplementary Provisions (February 3, 2012)
This amendment shall become effective from April 1, 2012.
(Note) Amended provision is as follows:4

Amended Paragraph 1 of Article 7.
Supplementary Provisions (May 26, 2015)
This amendment shall become effective from the date (May 29, 2015) provided for in themain text of Article 1 of the Supplementary Provisions of the Act for Amendment of theFinancial Instruments and Exchange Act (2014, Act No. 44).
(Note) Amended provisions are as follows:
Amended Article 1, Paragraph 1 of Article 2, Article 3, and Paragraphs 1
through 3 of Article 6.
Supplementary Provisions (December 17, 2020)
This amendment shall become effective from January 1, 2021.
(Note) Amended provisions are as follows:
Amended Article 1, Paragraphs 1 through 3 of Article 2, Article 3, Paragraphs
1 through 4 of Article 4, Paragraphs 1 and 2 of Article 5, Paragraphs 1
through 3 and Paragraph 5 of Article 6, Paragraphs 1 and 2 of Article 7, andArticles 8 and 9.

This translation is solely for the convenience of those interested therein, andaccordingly all questions that may arise with regard to the meaning of the words orexpressions herein shall be dealt with in accordance with the original Japanese text.

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