Proposals for the“Innovation and Financial Hub in Asia”
toward Realizing a Sustainable Society
February 2024

Tokyo Metropolitan Government

“Innovation and Financial Hub in Asia” for Realizing a Sustainable Society The Tokyo Metropolitan Government (TMG) financially contributes to the realization of a sustainable society, including Asia,
through the promotion of sustainable finance.
 Startups play a role as an engine of growth by creating innovation.

➡ Tokyo aims to contribute to the growth of Japan and Asia as a whole as a gateway to attract
global funds, talent, technology, and information
1. The Leading City for Sustainable Finance・ Cluster of advanced financial functions such as asset managementbusiness

2. The City where global startups are born・Cluster of startups looking for abundant funds and business
opportunities

・ Leadership in sustainable finance in Asia

・ Startups and sponsors work together to form an ecosystem➡ Utilizing the power of finance is utilized tocontribute to solving various social issues➡ Innovation hub

Funds

TalentTechnology

Information

3. The City with the Global Standard for Business in English
・ Forming an advanced ecosystem to support business and daily life
・ Attracting funds, talents, information, and technology beyond national
borders➡ An attractive place where diversified talents prosper

2

1. The Leading City for Sustainable FinanceSupport for initiatives to realize sustainability

Leading the realization of decarbonization in Asia
あ・ Promotion of transition finance (National Government/TMG)
・ Promotion of a market for carbon credits (National Government/TMG)
・ Establishment of a green hydrogen exchange market (TMG)

・あSupport for issuance of SDGs bonds (National Government/TMG)
・ Support for the use of sustainable finance by SMEs (TMG)
・ Tax benefit and regulatory reforms for investments in infrastructure
fund (National Government)
・ Formation of a private-public partnership fund (TMG)

Support for solving social issues
through the power of finance

TOKYO

Asia

Japan

Cluster of asset
management players
Cluster of domestic and foreign investments andasset management players
・あAvoiding double taxation for foreign investors (National Government)
・ Inviting of overseas asset management companies (TMG)
・ Regulatory reforms to reduce barriers to entry (National Government)
・ Financial aids in the startup phase (TMG)

Different types of support for the growth of asset
management companies
・ Promoting funding from public pension plans (National Government)
あ・ Review the upper limit of asset investment of startup asset managementcompanies for professional investors (National Government)
・ Prepare distinctive catalogs of startup asset management companies(TMG)
・ Support for matching with institutional investors (TMG)3

2. The City where global startups are born
Promotion of funding for SU・
Taxation and regulatory reforms
あsurrounding investment conditions such as
venture capital (National Government)
・ Attracting funds from foreign countries(National Government/TMG)

Enhancing hubs for support andcooperation for SU
あ・ Development of hubs where domestic andforeign startups and parties involved instartup ecosystems come together (TMG)

Enhancing administrative support toprop up the growth of SU・ Investment in SU in the later stage throughsovereign
wealthfund,etc.
(National
Government/TMG)
・ Expanding procurement from SU by the public
sector (National Government/TMG)

StartupInvestment

Startups that operate globally are born
Enhancing opportunities for
global interchange・ International events that serve as aあhuman exchange hub of SU andinvestors (TMG)

Enhancing global promotionalbases
・ Enhancing global promotionalbases around theあworld (National Government/TMG)
・ Enhancing information dissemination (National
Government/TMG)

Leading the world in Web3 inbusiness

・ Establishing rules for secure businessあoperations and development of infrastructures(laws on taxation and rights, trading market)(National Government/exchanges)
43. The City with the Global Standard for Business in English
Complete administrative procedures
only in English
・ Startup procedures such as registration andあsocial insurance are prepared in English(National Government/TMG)
・ Increasing the number of business types
eligible for applying for license in English(National Government).

Easy access to market
information in English
・あObligation to disclose information in
English (National Government/exchanges)
・ Support for listing on Japanese stock
marketsin
English(National
Government/exchanges)

Full range of specialized
financial personnel and services
・ Develop global human resources in
あfinance, legal, accounting, etc. (National
Government/TMG)

・ Establishment of a system in which
foreign companies and employees canopen a bank account smoothly (National
Government/private sector)

Ecosystems that support
business and daily life

Attraction of talents through open
system・ Establishment of a system in which highly
あskilled workers and their families can enter Japan
under various categories of visa (visa for investor)(National Government)

あCity of Arts and Culture
Attracting the World・ Establishment of an environment in which everyone canhave access to art and culture (National Government/TMG)
・ Promoting Tokyo's attractions such as history, culture,
food, animation, etc. that have been handed down since theEdo period (TMG)

Well-developed educational andmedical environment
・ Support for the attraction and expansion of
あinternational schools (National Government/
TMG)
・ Provide information on medical institutions
that provide services in English (TMG)
5

List of proposals for realizing the goals(1) The Leading City for Sustainable Finance(Regulatory reform) Proposal 1: Relaxation of requirements for entry of foreign asset management companies
Proposal 2: Establishment of a new business registration system for fund management companies
Proposal 3: Relaxation of regulations on investment management business for qualified investors
Proposal 4: Relaxation of the mandated reporting on the net asset values of private placement
funds for professional investors
Proposal 5: Development of laws on issuance of digital securities by local governments
Proposal 6: Expansion of the range of the finance and insurance industry subject to the creditguarantee system(Taxation)
Proposal 7: Abolish withholding tax on investment profits of foreign investors
Proposal 8: Expansion of investment fund contributions to new asset management companies
Proposal 9: Preferential treatment for investment in infrastructure funds(2) The City where Global Startups are Born
(Regulatory reform) Proposal 10: Develop an environment of startup investment by public university cooperations
Proposal 11: Further expansion of investment in startups by bank groups(Taxation)
Proposal 12: Financing for startups by means of investment trust(Others)
Proposal 13: Support for startups in the later stage through sovereign wealth funds(3) The City with the Global Standard for Business in English(Regulatory reform) Proposal 14: Enhancing procedures in English at the time of founding
Proposal 15: Establishment of on open status of residence to attract diverse talents (5 systems)(Others)
Proposal 16: Promotion of information disclosure in English
6Sustainablefinance

Proposal 1: Relaxation of requirements for entry of foreign asset management companies

Regulatory
reform Foreign asset management companies, etc. authorized by foreign authorities need to meet thebusiness registration requirements to engage in investment management business in Japan. These
requirements should be relaxed to promote their entry.
Current situations and issues

Specific requests○ Even an asset management company that has a proven record overseas○ Revise related laws and regulations to permit a foreign asset

and a solid compliance department needs to assign compliancemanagement company, etc. authorized by foreign authorities to outsource

personnel who “have sufficient knowledge and experience” tocompliance-related business to Japanese attorneys, etc. based on theengage in investment management business in Japan.

assumption that the compliance officer of the home country serves as the〇 Although no specific requirements for personnel who have sufficientknowledge and experience are described in laws and regulations or
guidelines, it is required for foreign asset management companies to
employ personnel who have work experience in Japan. It is difficult
to hire personnel familiarized with finance-related laws of Japan andthe home country in Japan.
⇒ The requirements for entry will be relaxed to attract more foreign asset
management players
Investment management business
Form

Stock company (with board of directors)

Requirementsfor personnel(example)・3 or more directors, 1 or more auditors
・It is required to assign independent compliance
personnel who have sufficient knowledge andexperience

Compliance Department of its Japanese subsidiary.

“Comprehensive Guidelines for Supervision of Financial
Instruments Business Operators, etc.”
VI-3-1-1(1)①(b) An officer who engages in day-to-day operations shall have sufficientknowledge and experience to understand and execute viewpoints ofbusiness management indicated in related regulations and guidelines
for supervision such as the Financial Instruments and Exchange Act aswell as sufficient knowledge and experience about compliance and risk
management required to accurately and fairly execute financial
instruments business.
(d) A Compliance Department (persons in charge) shall be establishedindependent of an Asset Management Department, and the persons
in charge shall have sufficient knowledge and experience.
7

Sustainablefinance

Proposal 2: Establishment of a new business registration system for fund management companies

Regulatory
reform A new business registration system for “fund management companies” should be established tofacilitate the new entry to asset management business, because an investment managementbusiness registration is currently required.
Current situations and issues

Specific requests○ The registration requirements for investment management business arestrict in terms of the stated capital, personnel and organizational
structure. Therefore, the number of asset management companies has
increased slowly.
○ Although it is desirable that various players can engage in asset○ A new registration system of “fund management company”
should be established as a platform specialized in middle andback operations with the aim of facilitating the division ofoperations through outsourcing.

management business by dividing works through outsourcing in

Image of division of works

order to increase the number of asset management companies,(Now)

restrictions under current laws and regulations are strict.

⇒ The entry of diverse asset management players will be facilitated bypromoting the division of works.
Investment advisory and agency business

Investment
businessmanagement

Form

Can be individual

Stock company (with board of
directors)

StatedcapitalNo restriction

50 million yen

Requirements
forpersonnel(Example)

・Corporate manager
・Person in charge of analysis, etc.
・Person in charge of compliance・Internal Control Manager※ Since these duties can be assigned tothe same person, it is possible to start abusiness with 2 or 3 persons.

・3 or more directors
・1 or more auditors
・Independent person in charge ofcompliance who has sufficientknowledge and experience(Afterdivision)

Investment management business
Investment decision
operations

Middle and back
operations

Investment decision
operations

Middle and back
operations

Investment advisory
and agency business＋

Fund managementcompany

The entry to “investment advisory and agency business” whose
hurdle for acquiring a license is high is facilitated to increase thenumber of “investment management” players in the future.

8

Sustainablefinance

Proposal 3: Relaxation of regulations on investment management business for qualified investors

Regulatory
reform To relax the upper limit of the total amount of investment properties in investment managementbusiness for qualified (professional) investors

Current situations and issues○ The licenses for investment management business are divided
into the regular license (full license) and the professional license
for qualified investors whose registration requirements are loose
than the former.
○ While the registration requirements are loose, the amount ofasset investment is limited to 20 billion yen.
○ It is required to pay attention to a risk of exceeding theupper limit when investment performance is well, because theupper limit is calculated at the market price including latent
profits, etc.
⇒ The relaxation of regulations will facilitate the growth of new
asset management companies【Reference】Registration requirements for investment management businessand restrictions on operations (partial excerpt)

Investment
management business(full license)

Investment
management businessfor qualified investors

Stated capital

50 million yen

10 million yen

Upper limit of asset

N/A

20 billion yen (market

investment

Specific requests○ Relevant laws and regulations should be revised to relax theupper limits for investment management business for qualified
investors.
Order for Enforcement of the Financial Instruments and ExchangeAct, Article 15-10-5
The amount specified by Cabinet Order that is provided for in Article 29-5, paragraph(1), item (ii) of the Act is 20 billion yen.

(Suggested relaxation measures)① The upper limit of the total amount of asset investment shouldbe raised(around 100 billion yen).
② Book value should be calculated at the time funds undermanagement are accepted. Alternatively, there should be a certain
grace period (e.g., one year) before the registration of the investment
management business (full license) is changed, rather than
immediately making it a violation when the total amount of assets
under management exceeds the limit.

value)
9

Sustainablefinance

Proposal 4: Relaxation of mandated reportingon the net asset values of private placement funds for professional investors

Regulatory
reform To review the obligation to send a daily report on the net asset values of private placement funds for
qualified (professional) investors to the Investment Trusts Association to reduce administrative
burden of asset management companies
Specific requests
Current situations and issues○ It is required for an asset management company that forms
investment trusts in Japan to join the Investment Trusts
Association, and to report a net asset value of each investment
trust to the Association every business day.

○ There are private placement funds formed for professional○
Self-regulatory rules set by the Investment Trusts
Association should be revised to relax the obligation to report(frequency) on the net asset values of private placement funds(e.g. monthly).
Regulation on Evaluation and Accounting of Investment
Trust Property (partial excerpt)

investors. Although the volume and frequency of trade is lower
than public investment trusts which many investors trade, thesame obligation applies.
⇒ To reduce the cost of forming investment trusts by reducing

administrative burden of asset management companies(Reference) Percentage of domestic investment trusts (number offunds)(As of December 2023)
Total investment trusts: 14,430
Public investment
trusts: 41 ％Private investment trusts: 59 ％(Private placement by qualified
institutional investors, etc.: 51%)

(Source) Compiled by TMG from "Overview of Investment Trusts (as ofDecember)" and "Overall picture of investment trusts (net asset value andnumber of funds)" by The Investment Trusts Association, Japan.

Article 51
The calculation of net asset values of investment trust beneficiary
certificates shall follow the Investment Trust Act, the Order for
Enforcement of the Investment Trust Act, and the Regulation for
Enforcement of the Investment Trust Act as well as these rules.
However, any matter not specified in the above shall apply mutatis
mutandis to the provisions of the “Regulation on Real-estate
Investment Trusts and Real-estate Investment Corporations” and the“Regulation on Infrastructure Investment Trusts and Infrastructure
Investment Corporations. Further, any matter not specified in thoseregulations shall follow accounting standards generally accepted asfair and appropriate.
(2) The calculation of net asset values of investment trust
beneficiary certificates shall be made, in principle, on a daily basis
for each currency in which the net asset value is indicated.
10

Sustainablefinance

Proposal 5: Development of laws on issuance of digital securities by local governments

Regulatory
reform Necessary laws should be developed to allow local governments to issue digital securities withthe aim of creating a new investment environment using blockchain technology.

Current situations and issues

Specific requests○ Digital securities can be issued in small lots compared to
traditional securities and their issuing entity and investors areconnected directly. Therefore, it is expected that digital securities
contribute to accelerating the transition from savings to investment.
○ The Local Finance Act and the Ordinance for Enforcement of the
Local Finance Act that provide for an issuance method of local
government bonds do not foresee that local government bonds be
issued without materializing them except book-entry transfer
bonds whose right is transferred through a book-entry institution.
⇒ The development of securities markets is promoted by approving
the issuance of digital local government bonds〇 Related laws and regulations should be revised to allow
local governments to issue digital securities.

・ We need a flexible
and convenient way
of financing.
・ We are looking for
supporters.

Characteristics of digital
securities
It is easy toissue insmall lots

It is possible to monitor
investors directly on areal-time basis

・ I’m looking for a new
type of investment.
・ I’m looking for a nonmonetary reward,

etc.

Issuing entity

Article 33: In cases where a local government issues local
government bond certificates by way of solicitation, the local
government must create an application form for local government
bond certificates and enter the following matters therein.
Article 39: The provisions from Articles 33 to 35, Article 36,
paragraph (1), Article 37, and Article 38 shall apply mutatis
mutandis to cases where local government bonds (hereinafter inthis Article, Article 40, and Article 43, paragraph (2) referred to as“book-entry transfer bonds”) to which the provisions of the Act
on Book-Entry Transfer of Corporate Bonds and Shares (ActNo.75 of 2001) apply are issued.

(Draft revision)Issuance of digital
securities
Award of return/reward
Investment＜Ordinance for Enforcement of the Local Finance Act＞

Investors

 The provision on issuance of physical local government
bonds should be revised to allow local governments toissue digital securities.
11

Sustainablefinance

Proposal 6: Expansion of the range of the finance and insurance industry
subject to the credit-guarantee system

Regulatory
reform The range of the credit-guarantee system is expanded to form an ecosystem of financial institutions.
Current situations and issues

Specific requests○ Only the finance and insurance industry provides a limited list (positivelist) of business types subject to the credit-guarantee system and loan granted○ Revise the relevant laws and regulations to change themethod of enumerating the industries covered by the system tothe method of enumerating the excluded industries, and to
expand the scope of the financial and insurance industries
covered by the system.

by Japan Finance Corporation.
○ Although the range was expanded to asset management companies, etc. in
response to the ordinance revision in 2022, the limited listing system has
been maintained. Therefor, new business types and business types whose
number of businesses is few are not included. Since the Japan Industry
Classification is referred to in the list, it is difficult to know if a new businesstype if included (e.g. financial service intermediary business).
○ A business operator engaged in a new business type related to finance is
not eligible for the credit-guarantee system and loan from Japan FinanceCorporation.
⇒ The start of business of diverse players is facilitated by expanding therange of business types applicable to credit and loan to promote innovationin the financial field.
【Reference】Status of use of Tokyo Guarantee by business type (FY2022)(Current) Limited listing of subject business types (highlighted)

Ordinance for Enforcement of the Small Business Credit
Insurance Act (excerpt)(Range of small and medium-sized enterprises)
Article 1: The business types specified by Cabinet Order under Article 2,paragraph (1), item (i) of the Small Business Credit Insurance Act shall bethose other than listed below.
(iv) Finance and insurance industry (excluding credit card
industry/installment finance industry, financial instruments business(excluding auxiliary financial instruments business), commodity futurestransaction business/commodity investment advisory business,
auxiliary financial business/business incidental to finance (omitted), thosethat engage in funds transfer business and (omitted) issue prepaid
payment instruments, financial agent business (limited to financial
instruments intermediary business), insurance intermediary agent
business, and insurance service).
※The same provision is found in the Ordinance for Enforcement of the Japan
Finance Corporation Act.

(Source) Compiled by TMG from Tokyo Guarantee
Association System "Tokyo Credit Guarantee
Association Report 2023" statistical data.

(Draft revision) Subject business types are listed in a limited manner

12

Sustainablefinance

Proposal 7: Abolish withholding tax on investment profits of foreign investors

Taxation In cases where foreign institutional investors invest in a fund created in Tokyo, tax on dividends sent to othercountries should be withheld regardless at the source of whether an application for tax exemption is filed undertax convention.

Current situations and issues

Specific requests○ In cases where a foreign investor invests in a fund in Japan (investment○Revise related laws and regulations to abolish tax withholding at thesource on investment profits generated in Japan by foreign investors.

corporation, contractual-type investment trust, limited partnership forinvestment, etc.), tax on investment profits are withheld at the source.
○ Although there are tax exemption measures under convention or the Act on
Special Measures concerning Taxation, the requirements and procedures forapplication are so complicated that it is difficult for foreign investors to use.
Unless tax exemption measures are applicable, double taxation may occur inJapan and the home country.
⇒ Investment in Japan by foreign investors is facilitated by eliminating concerns
about taxation systems

HomecountryJapan

Dividends
Taxation

Tax exemption under tax convention

Investment

Dividends

Japanesecompanies

Foreigninvestors

Taxation

Japanese fundInvestment

Income Tax Act (partial excerpt)
Article 5(2) A Nonresident is liable to pay income taxes pursuant to this Act if;(i) the Nonresident has domestic source income as prescribed in Article 161.
Article 161: The term "domestic source income" as used in this Part means:(i) In cases where a nonresident conducts a business through a permanentestablishment and the permanent establishment is a business operator thatengages in a business independent of the nonresident, profits attributable tothe permanent establishment taking into account the functions that thepermanent establishment fulfills, assets used in the permanent establishment,internal transactions with a place of business of the nonresident, and othercircumstances.
(iv) Profits generated from a business conducted through the permanentestablishment based on a partnership agreement provided for in Article 667,
paragraph (1) of the Civil Code, which the earner is distributed based on such an
agreement and which are as prescribed by Cabinet Order.
(viii) interest and similar income as prescribed in Article 23, paragraph (1)(Interest Income), which is as follows:(d) a distribution of proceeds from a Jointly Managed Trust, Bond
Investment Trust, or Bond-Based Investment Trust Under Public Offering
which has been established as a trust at a business office located in Japan.
(iv) dividends and similar income prescribed in Article 24, paragraph (1)(Dividend Income), which are as follows:(b) a distribution of proceeds from an Investment Trust or a Specified TrustThat Issues Beneficiary Certificates, which has been established as a trust at abusiness office located in Japan.
13

Sustainablefinance

Proposal 8: Expansion of investment fund contributions to new asset management companies

Taxation The regulations on public pension plan will be relaxed and tax incentives are given to institutional investors to
expand the supply of funds necessary for the growth of new asset management companies (EM).

Current situations and issues○ It is indispensable to acquire funds for the growth of EMs in theirstartup phase. However, even for promising Ems, it is difficult toreceive funding from public pension plans, institutional investors,

Specific requests〇 The following two points should be modified.
① The Basic Policy for Reserves should be revised to relax
the requirements for public pension plans when selecting
entities with which asset management is entrusted.

etc. due to lack of past investment performance.

○ Particularly, public pension plans require entities to which asset
investment is entrusted to have business history and investment
performance. There is a high hurdle for EM to be selected.

⇒ Funding for EM from institutional investors and public
pension plans is facilitated to support their growth
Government’s policies (basic policy for reserves)<Conditions for active management>
Past investment
performance istaken into accountSufficient evidence
to corroborate
excess return

Basic Policy for Reserves
11 (Basic policy for safe and efficient management andinvestment of reserves from a long-term perspective)
A management and investment entity should combinate
passive management and active management, in principle, toacquire excess return from active management. However,active management should be carried out based on theassumption that there is sufficient evidence that excess
return is gained taking into account past investment
performance.
② Establish new tax incentives for institutional investors
to contribute funds to EM.
(Example) Deduction of a certain percentage of contributions

It is difficult to provide funding to new asset managementcompanies

should be permitted
14

Sustainablefinance

Proposal 9: Preferential treatment for investment in infrastructure funds

Taxation The preferential treatment allowed for investment corporations that mainly invest in renewable energy power
generation facilities should be permanent and its range expanded.

Current situations and issues○ The preferential treatment for infrastructure funds thatmainly invest in renewable energy power generation facilities(dividends from funds can be deducted) is a temporalmeasure by FY2025.
〇 Currently, renewable energy power generation facilities are

solar power generation facilities and associated facilities.
However, facilities that contribute to the introduction ofrenewable energy such as grid-scale battery facilities are
not included.
⇒ It will be possible to promote the introduction of renewableenergy by converting this preferential treatment into apermanent measure and expanding facilities subject thereto(Fund scheme)(Source) Financial Services Agency “FY2023 Tax Reform” (December 2022)

Specific requests○ The following modifications should be made by revising
applicable laws and regulations.
・ The temporal tax preferential treatment for investment
corporations that mainly invest in renewable energy generation
facilities should be permanent.
・Renewable energy generation facilities should include gridscale battery facilities＜Related laws and regulations＞
・Article 67-15, paragraph (1), item (ii)-g of the Act on Special
Measures Concerning Taxation
・ Article 39-32-3, paragraphs (10) and (12) of the Order for
Enforcement of the Act on Special Measures Concerning Taxation
・Article 3 of the Order for Enforcement of the Act on Investment
Trusts and Investment Corporations
・ Article 2, paragraph (2) of the Act on Special Measures
Concerning Promotion of Use of Electricity from Renewable
Energy Sources

15

Proposal 10: Develop an environment of startup investment by public university cooperations

StartupRegulatory
reform Public university corporations should be allowed to invest in university-launched startups.
Current situations and issues

Specific requests○ From April 2022, it has become possible for national university
cooperations to invest in private funds and university-launched startups in
response to the revisions of the Act on Strengthening Industrial
Competitiveness and the Act of National University Corporations.
○ On the other hand, public university corporations cannot invest in
venture capitals and university-launched startups under the Act on
Regional Incorporated Administrative Agency.
⇒ The regulatory relaxation will make it possible to support diverse startups○ A framework allowing public university corporations toinvest in startups should be established by revising applicable laws
and regulations so that all universities in Japan can spark a wave ofinnovation through startups based on their own research seeds andthe power of students.
○ This framework encourages universities to invest in their own
students and researchers. A system in which universities can makeinvestment should be examined and realized at an early stage(Range of investment by national university corporations andpublic university cooperations)
Business
promoting theutilization of
results

Business
Technology supporting thelicensingutilization oforganization
specified(approved TLO)
research
results

Businessutilizing
research
results

Local Independent Administrative Agency Act

Designatednational
Educational anduniversity
research facility
business utilizing management businessresearch results

Businesses
that Organizations
Certified
VC Businesses that UniversityBusinesses that carryconduct necessary thattransfer and funds that provide
launched ventures out projects to manage
researches
on research results at invest in and consultingthat develop and resourcessuchastechnologies
universities
to support
for services,
provide products educational
and
owned
by private businesses universitytraining courses, and services by researchfacilities
universities
for through licensing launchedandlectures receiving
the owned by universities
putting their results of patent rights, venturesutilizing
resultsof and promote theirinto practical use etc.
research results researches
on utilization by other
or
plan
and
of universities technologies
research
institutions,facilitate necessary
ownedby etc. for the purpose of
researches
universities
givingback
those
resources to society
National
university
corporation

Yes

Yes

Yes

Yes

Yes

Yes

Publicuniversity
corporation

Yes

Yes

No

No

No

No

(Created based on “Range of investment by national university corporations, etc.”,
Ministry of Education, Culture, Sports, Science and Technology)(Prohibition of other business)
Article 70: A public university corporation shall not conduct
any business other than businesses listed in Article 21, item (ii)and businesses incidental thereto.
(Scope of business)
Article 21: A local independent administrative agency shallconduct a business specified in its articles of incorporation
among the following businesses.
(ii) Investing in an entity engaged in establishing and managing
a university or a university and a college of technology and abusiness specified by Cabinet Order to facilitate the utilizationof results of technological researches conducted in said
university or said university and college of technology.
16

Startup

Proposal 11: Further expansion of investment in startups by bank groups

Regulatory
reform Investment restrictions and other regulations imposed on bank groups should be relaxed to further
expand investment in startups.
Current situations and issues○ Currently, the type of businesses which banks can conduct is restrictedunder the Banking Act.
○ As an exception, it is allowed to invest through an investmentspecialized subsidiary. However, investments can be made only incompanies for which 10 years have not passed since their establishment.
It is difficult to invest in fields that require time for commercializationsuch as drug discovery.
○ In addition, the consulting services of the specialized investment
subsidiary are limited to investees, etc., and the investment management
expertise of the specialized investment subsidiary cannot be used forinvestees directly invested in by the bank itself.
(Restriction of holding voting rights imposed on banks)
Bank

Investmentspecialized subsidiary

Startups, etc.
(Less than 10 years since
their establishment)(Principle)
It is prohibited for a bank or its subsidiary toacquire or own a total of over 5% of voting
rights of an ordinary company in Japan.

(Exception)
It has become possible to invest in startups forwhich 10 years have not passed since theirestablishment beyond the above restriction
through an investment-specialized subsidiary,as long as certain requirements are met.

Specific requests○ Promoting the growth of promising startups by revising
relevant laws and regulations to expand the scope of investment
and consulting services provided by banking subsidiaries.
Regulation for Enforcement of the Banking Act
Article 17-2: The services specified by Cabinet Office Order that areprovided for in Article 16-2, paragraph (1), item (iii) of the Act means thefollowing:
5 Companies provided for in Cabinet Office Ordinance as provided for in Article
16-2 paragraph (1) item (xii) of the Act (for brevity) shall be companies for which
ten years have not passed since the date of incorporation or the date ofcommencement of new business activities.
14 Those specified by a Cabinet Office Ordinance as prescribed in Article 16-2
paragraph (1) item (xii) of the Act shall be companies that exclusively engage inthe following businesses and businesses incidental thereto(ii) Providing consultation concerning the management of other business
operators, etc., introducing business operators, etc. or customers related to thebusiness of said other business operators, etc., and providing other necessary
information and advice (limited to those pertaining to a stock company thatreceives or is expected to receive funds supplied by the business listed in
the preceding item).

(Draft revision)
・It should be allowed to invest in companies that are at least 10 years old fromeither the date of incorporation or the start of a new business.
・The consulting services of the subsidiary specializing in investment should beavailable to companies other than those in which the company has invested.
17

Proposal 12: Financing for startups by means of investment trusts

StartupRegulatory reform

Taxation

 Investment trusts are utilized to develop an environment where individual investors can invest in startups easily.

Current situations and issues

Specific requests○ The only means by which individuals can invest in startups in asmall amount is limited to stock crowdfunding, etc. In addition, thetargets that can be included in investment funds are limited.
〇 A listed venture fund (corporate-type investment trust) is
expected to be used as a scheme for small investments in startups byindividual investors. The Tokyo Stock Exchange is revising the rules
for listing to develop an environment for promoting its utilization.
○ In the United Kingdom, about 1 trillion yen of funds of individual
investors is invested annually, because a tax preferential treatment isgiven under certain requirements when individual investors invest in
listed venture funds.
⇒ Promote the supply of funds to startups, etc. by creating anenvironment where individual investors can invest in promising
startups, etc. without fear through listed venture funds.

○ A tax preferential treatment should be introduced for individuals
who invest in listed venture funds, etc.
〇 Revise the relevant laws and regulations to make emission credits
and other investment targets includable.

Tax treatment under the VCT (Venture Capital Trust) system in the UK
At the time ofinvestment

30% of the amount of investment is returned fromincome tax (Some restrictions such as the upper limit ofinvestment and holding period)

At the time of holding Income gain (dividends) is not taxable
venture fundAt the time of selling
venture fund

Capital gain (profits at the time of selling) is nottaxableAct on Investment Trusts and Investment Corporations
Article 2(1): The term "investment trust managed under instructions
from the settlor" as used in this Act means a trust whose purpose isfor trust property to be invested mainly in securities, real property,
and other assets that Cabinet Order specifies as those in which it isnecessary to facilitate investment (hereinafter collectively referred toas "specified assets") based on the settlor's instructions (or based on
the instructions of a person provided by Cabinet Order, if such aperson is entrusted with all or part of the authority for giving
instructions), which is established based on this Act, and whose
purpose is for the beneficial interest to be divided and for multiple
persons to acquire it.
Order for Enforcement of the Act on Investment Trusts andInvestment Corporations
Article 3: The assets specified by Cabinet Order as referred to in
Article 2, paragraph (1) of the Act are as follows:(i) securities;(ii) rights pertaining to derivatives transactions; (omitted)
18

Startup

Proposal 13: Support for startups in the later stage through sovereign wealth funds

Others To further strengthening financing for startups in the later stage with the aim of nurturing worldclass unicorns.
Current situations and issues○

Specific requests

An environment where startups can raise sufficient funds inaccordance with their growth stage is required to nurture world-classstartups and solve social issues.
○ In Japan, financing for startups in the later stage is not sufficient so○ Financing for startups in the later stage should befurther strengthened through sovereign wealth funds
such as Japan Investment Corporation.

that they tend to look for an opportunity for listing (IPO) at an early stage.
○ It is also pointed out that there is insufficient investment andaccompaniment support for companies immediately after their IPO.
⇒ The growth of startups is further accelerated by allowing appropriate

International Comparisonof Amount of Funds Raised per IPO (2021)

Funding per IPO($bn)

financing in accordance with growth stage
Growth Market Listing
Corporate
Value ofInvestment

Prime Market Listing

Lack of growth capital providers during therater period and immediately after the IPO
later

Immediately
after the IPO

U.S

EuropeAsia(except Japan)

Japan

Source: Secretariat of the Headquarters for the Realization of New Capitalism, “Data on Startups” (October 2022)

MiddleEarly
Seed
Growth stage of the company

19English

Proposal 14: Enhancing procedures in English at the time of founding

Regulatory
reform It should be allowed to fill in forms and applications in English for procedures at the Tokyo OneStop Business Establishment Center for certification of articles of incorporation, registration ofincorporation, labor insurance, health insurance, and employees' pension insurance.
Current situations and issues○ At the Tokyo One-Stop Business Establishment Center (jointly administered by
the national government and the TMG under the framework of national strategic
special zone), it is allowed to fill in forms and applications for payment of
metropolitan and national taxes and immigration control in English. However, it
is not allowed to fill in forms and applications for other procedures such as
certification of articles of incorporation, registration of incorporation, labor
insurance, health insurance, and employees' pension insurance in English.

〇 It is required to prepare documents in Japanese and in English to give explanation

Specific requests○ It should be allowed for foreign companies such as asset
management companies to fill in forms and applications

for undertaking procedures at the Tokyo One-StopBusiness Establishment Center mentioned on the left in
English.
○ Regulations, etc. should be revised where necessary to
accept documents written or applied in English.

to the headquarters in the home country.
⇒ The entry to Japanese markets is facilitated by reducing the burden for procedures(Tokyo One-Stop Business Establishment Center)at the time of starting business
ABC
Certification of articles of incorporation,
registration of incorporation, etc.

Foreignentrepreneurs

Tokyo One-Stop Business
Establishment Center

20

English

Proposal 15-1 Establishment of status of residence (foreign investors)

Regulatory
reform Resident status should be created for the purpose of nurturing world-class startups with thesupport of reliable foreign investors
Current situations and issues

Specific requests○ In other countries, angel investors play an active role in providing
funds to startups in the seed or early stage. Moreover, they nurtureworld-class startups by providing advice as mentors. On the other
hand, it is difficult for them to engage in those activities with astatus of residence granted by the government of Japan.
⇒ The invitation of more foreign investors who play an essential
role in nurturing startups is facilitated by establishing a new statusof residence○ Related laws and regulations should be revised to establish astatus of residence approved in accordance with the following
principal requirements.

• They are interested in potential for growth of markets forstartups in Japan and desire to stay for a longer period oftime with their families to invest in and provide

Foreigninvestors

support to startups.

Foreign investors cannot stay in Japan for a long period of time forinvesting in or nurturing startups under the current status of residence.
Existing status of residence
Business/Management highly
skilled professional 1(c)It is required to engage in establishment
and management of a corporation in Japan

Short stay (up to 90 days)

The period of stay is short

・A person has experience in helping a company grow as aninvestor, entrepreneur, or executive.
・A person is capable of identifying technology or ideas owned
by a startup (record in specific field, history of awards,
recommendation from a trusted person, etc.)
・A person has a certain amount of assets and nurtures a startup
by making a certain amount of investment and providing
advice.
※ The status of investment is monitored during the period of stay. In
cases where the performance of investment does not satisfy theconditions, the status of residence is rescinded.

Article 19 Immigration Control and Refugee Recognition Act
Any foreign national who is a resident under a status of residence set
forth in the left-hand column of the Appended Table I must notengage in the activities set forth in the following items in accordancewith the categories identified therein, except for cases in which they
engage in the activities with permission prescribed in paragraph (2) ofthis Article:
21

English

Proposal 15-2 Establishment of status of residence (same-sex partner)

Regulatory
reform A special provision for the stay of same-sex partners should be established

Current situations and issues

Specific requests○ Currently, spouses of same-sex marriages legally approved inother countries are allowed to stay in Japan. However, samesex partners who made a public registration under thepartnership program are not allowed to stay.
○ It is required to establish a special provision for same-sex
partners from the perspective of encouraging more foreign
financial institutions to operate in Japan by accepting more
highly skilled foreign professionals and realizing diversity
including LGBT.
Country/region

Status of residence for same-sex partnership

US (State of New York)△ (Temporary measure until marriage)

UK (England, Wales)〇

Germany〇

France

〇

Italy

〇

Canada (Quebec)〇○ Related laws and regulations should be revised to establish
a special provision for treating same-sex partners registeredunder the partnership program in the same way as same-sex
spouses for immigration and residency examinations.
○ It is desirable to clearly state in an announcement insteadof a notice the status of spouses of same-sex marriages.

Treatment of immigration and residency
examinations for spouses of same-sex marriages(Ministry of Justice Residency Control No.5357)
It is now allowed for a spouse of same-sex marriage toenter and stay in Japan under the status of residency“specific activity”. Therefore, in cases where a spouse ofsame-sex marriage applies for a permission for change of
his/her status of residency to “specific activity” to live withand under support of the spouse, it is necessary to ask the
Ministry of Justice for advice with opinions, because there
is a circumstance that requires consideration from ahumanity perspective, instead of making an instant decision.

Created by the TMG based on the website of the Government of Japan, academic papers, and news
reports, as of November 201822

English

Proposal 15-3 Establishment of status of residence (telework)

Regulatory
reform The status of residency should be modified to allow spouses of highly skilled foreign workers toremotely work for foreign companies, etc., while living in Japan
Specific requests

Current situations and issues○ In many cases, highly skilled foreign workers have double
income. There is a need for a visa category that allows theirspouses to continue to work with companies in their homecountry as a teleworker, while staying in Japan.
○ On the other hand, it is not allowed for spouses of highly
skilled foreign workers to apply for specific activity visa
(No.33) without having an employment contract with aJapanese company.
○ Many foreign companies accept diverse working styles suchas cross-border telework. However, in cases where highly
skilled professionals move to Japan, their spouses need to quita job in their home country and find another job in Japan.

○ If you have a remote work-based employment contract with apublic or private organization overseas while residing in Japan,
treat the contract in the same way as a "contract with a public or
private organization in Japan".
Notice of specific activity 33
Any of the activities listed in Appendix 5 in which a spouse of a highly skilled
professional (limited to a person who lives together with that highly skilled
foreign professional) engages in return for rewards equivalent to or higher thanthose Japanese citizens would receive when engaging in such activities, based ona contract with a public or private institution in Japan (hereinafter omitted)(Draft) Requirement for remote work-based employment contract※ In principle, the conditions equivalent to those at the time when a worker is
employed by a private company or public institution in Japan

Employme
nt check・ Effective employment contract with companies in homecountries which are rated as low risk in overseas company
credit survey
・ Transfer of rewards to accounts in Japan

SocialwelfareEnrollment in the national pension plan and the national
health insurance plan

Rewards sent to the home country are taxed and insuranceTaxpremiums are collected from and taxes are imposed on rewards
obligation sent to the home country

Others

The current system applies to other requirements

23

English

Proposal 15-4 Establishment of status of residence (domestic workers)

Regulatory
reform The regulation on requirements for accompanying domestic workers of highly skilled foreign
workers should be further relaxed
Current situations and issues

Specific requirements○ Although requirements for domestic servants to accompany their families
have been relaxed in the past, there is a need for further relaxation from highly
skilled foreign workers.

○ Related laws and regulations are revised to relax theregulation on domestic workers.

(Current situation) Requirements for accompanying domestic servants
・ Entry to Japan: The employment period of accompanying domestic workers in homecountry is one year or longer
・ Family circumstances: The employment period of accompanying domestic workers inhome country is less than one year and it is allowed if there is a spouse who cannot
do housework due to a child under 13 years of age or sickness→ Allowed under certain conditions (household income, salaries for domestic workers,
etc.)
・ The household income of highly skilled foreign professionals is more than 10
million yen
・ 1 accompanying domestic worker is employed, etc.

(Draft deregulation measures)・Relaxation of the limit of domestic workers
Example) Up to 2 domestic workers can be accompanied
when moving to Japan or there are family circumstances＜Related laws and regulations＞

Notice of Specific Activities item (ii)-2, (ii)-3

The following mitigation measures are provided for financial personnel
Relaxation of regulations on human resources engaged in the finance field such as
investment management business (July 2021)
It is allowed for highly skilled foreign professionals engaged in investment
management business, etc. to employ the number of domestic workers in accordancewith the following household income
・ 10 million yen ~ 30 million yen: 1 domestic worker
・ Over 30 million yen: 2 domestic workers

Regulatory relaxation on highly skilled professionals (April 2023)“Highly skilled professionals” can employ up to 2 foreign domestic
workers in cases where the household income is over 30 million yen.

24

English

Proposal 15-5 Establishment of status of residence (accompanying parents)

Regulatory
reform The regulation on accompanying parents of highly skilled foreign workers should be relaxed
Current situations and issues

Specific requirements○ There is a need from highly skilled foreign workers to allow their parents
to accompany them more widely.

○ Related laws and regulations should be revised to relax theregulations on accompanying parents of highly skilled foreign

Requirements for accompanying parents
・ In case of raising a child of a highly skilled foreign professionalor his/her spouse younger than 7 years old
・ In case of caring a pregnant spouse of a highly skilled foreign
professional or a pregnant highly skilled foreign professional→ Permitted under certain requirements (household annual
income, living together, etc.)
・ The household annual income of the highly skilled foreign
professional is more than 8 million yen
・ The person lives together with the highly skilled foreign
professional, etc.

workers(Draft deregulation measures)・The condition for limits on accompanying parents (care of pregnant
highly skilled employee or upbringing of children younger than 7
years old) is relaxed(Examples) ・ The age of children who require care is raised to“younger than 13 years old”
・ Not only pregnancy but also the case where the spousecannot fully carry out daily housework due to pregnancy or
sickness should be accepted as a reason for granting the status ofresidency
Notice of Specific Activity No.34
A daily activity as a father or mother of a highly skilled foreign
professional (limited to those whose household income is more than
8 million yen at the time of application) who lives with that highly
skilled foreign professional and nurtures a child younger than 7 years
old of that highly skilled foreign professional or his/her spouse or asa father or mother of a pregnant highly skilled foreign professional
who provides care, do housework, and offer other necessary
assistance or a father or mother of a spouse of that highly skilled
foreign professional (limited to the father or mother of that highly
skilled foreign professional or his/her spouse).
25

Proposal 16: Promotion of information disclosure in English

EnglishOthers The English disclosure of information on IR should be obliged in the Tokyo Stock Exchange’s
prime market as early as possible and measures for supporting initiatives by companies taken.
Specific requests

Current situations and issues○ Foreign investors have a low opinion of Japanese companies' English-○ The obligation to disclose information on IR in English
language disclosure, which affects their investment decisions.
should be expanded gradually to financial statements.
〈Satisfaction level of foreign investors about English disclosure〉 〇 To that end, measures for supporting companies that
Somewhat
Satisfactory
disclose information in English should be given such as thesatisfactory0%
improved precision of AI-powered translation.
15%
Neither satisfactory
nor unsatisfactory

Unsatisfactory〈State of English disclosure of listed companies in the Tokyo
Stock Exchange prime market〉

13%

45%

Somewhat
unsatisfactory

27%〈Effect on investment〉(Source) Tokyo Stock Exchange, Inc.
“Survey of Overseas Investors on English
Disclosure by Japanese Companies”(August 2023)

Evaluated after discount
ディスカウントして評価

41%

Excluded frominvestment targets
投資対象から除外
The weight was reduced
ウェイトを減らした

35%
28%

Policy for enhancement of English disclosure in Tokyo Stock
Exchange (Prime Market) (draft)
Documents to be disclosed in English: Earnings reports, IR eventand presentation materials, timely disclosure
Time: After the March 2025 term
※The system outline will be announced in February 2024 or later.

92%

Earnings
reports

48%

44%

8%

71%
IR event andpresentationmaterials
Annual securities
reports

63%

8%

19%

10%

25%
8% 7% 10%

Excerpts orAll
PartialNo disclosure in English

76%
Other English-language materials
containing the same information(Source) Tokyo Stock Exchange, Inc., “Survey Summary Report for Obligation ofEnglish Disclosure in the Prime Market” (As of the end of August 2023) (October 2023)

26

Initiatives of the TMG
for an “Innovation and Finance Hub inAsia” toward Realizing a Sustainable
Society”

27Sustainablefinance

The TMG aims that sustainable finance is widely adopted among companies and the citizens◤ Support for financing of companies ◤ Investment to solve social issues (public(subsidies)
private partnership fund) Support for conversion of SMEs to sustainability
management
 Public-private partnership funds are formed for the purpose(Project to promote sustainability management inof promoting renewable energy and impact investment
cooperation with financial institutions)➡ The partnership agreement has been concluded with
 A new finance model is created by attracting private funds
19 financial institutions
 Support for issuance of SDG bonds by companies(Project to support the issuance of SDG bonds)➡ Green bond, social bond, transition bondtaking advantage of the investment by the TMG➡ Funds that promote the transition to circular economy
and the preservation and restoration of biodiversity will be➡ Blue Finance※ will be added in FY2024
formed in FY2024※Investment and loan to facilitate sustainable economic
activities by preserving the marine environments andusing sustainable marine resources◤Provision of information that helps sustainable finance to be widely accepted and deep rooted
 Operation of portal site
(Tokyo Sustainable Navi)➡ Integrated information on subsidies and examples

 Events (Tokyo Sustainable Finance Week)➡ Events for domestic and foreign parties concerned offinance, SMEs, and broader citizens are held28

Sustainablefinance

Establishment of systems to promote initiatives for decarbonization bycompanies, etc. and of trading platforms

Obligation imposed on large places of business to
reduce total emissions and emission trading

Initiatives for more active carbon credit trading by SMEs
 A TMG’s own platform will be built in FY2024 on which
SMEs can simply trade national and foreign carbon credits.

 The urban cap & trading system for office buildings, thefirst of its kind in the world, was launched in 2010.

 Transparency of credits is ensured by utilizing blockchain
so that secondary distribution is possible.

 Approximately 1,200 places of business in Tokyo that
account for 40% of CO2 emissions in Tokyo from theindustry/business sector are subject to this system.
＜Image of Cap & Trade＞
Obligation to reduce
CO2 emissions

Trade

In
FY2021,thereferenceemission
was reduced by 33%(Approximately 20% of
places of business fulfilled
the obligation utilizing
credits, etc.)

Buildings with reductions
above the mandated rate

It is possible tofulfill the obligation
by buying CO2
reductions of otherplaces of business(emission trading)in cases where aplace of businesscannot fulfill its
obligation by own
measuresfor
reduction

blockchain
National and international
project implementers
Buy Tokens

Tokenize

SMEs

Excess reduction

Reductionshortfall＜Image of carbon credit trading platform＞

Buildings with insufficient
reduction

Trading Platforms

・Register credits with a certification body・Exhibit credits

Initiatives for starting up a Green hydrogen exchange The trial trading will start in FY2024. The sales price and thepurchase price are decided by bidding. The price different is
subsidized by the TMG.

Issues toward more active carbon credit market
 Enhancement of disclosure of information on traded credits
 Clarification of the characteristics, types, and legal status of diverse credits
 Diversification of traded products (futures and high-quality voluntary credits, etc.)

29

Sustainablefinance

Support for utilization of sustainable finance by companies
Support for financing of companies by means of the issuance of SDG
bonds

Support for introduction of sustainability
management by SMEs

Subsidies are granted to cover external evaluation costs required toissue SDG bonds.

Subsidies are granted to cover external evaluation costs
incurred to obtain sustainable loans from financial institutions
that have concluded the partnership agreement with the TMG＜Bonds subject to support＞
 Green bonds/sustainability bonds (subsidies added to those grantedby the Ministry of the Environment) Transition bonds (subsidies added to those granted by the Ministry of
Economy, Trade, and Industry)
 Social bonds (granted only by the TMG)
 Blue bonds ※Will expand from FY2024(subsidies added to those granted by the Ministry of the Environment)＜List of sustainable loans subject to support＞
 Sustainability link loan (SLL) Positive impact finance (PIF) Green/blue loan ※Will expand from FY2024
Basic Scheme (SLL・PIF)

Basic scheme※ 19 financial institutions that have concluded the partnership agreementwith the TMG (in the order of the date of conclusion)

In cases where bonds issued are for individual investors, additional
subsidies are granted⇒ Issuing entities do not need to cover costs ※Will expand in FY2024▶ Performance of support for financing (By FY2022)〇 Support was provided to financing over 600 billion yen in total in
FY2021 and FY2022
30※Only green bonds and sustainability bonds by FY2022

SustainablefinanceStartups

Private company(LP: Limited liability partner)

TMG(LP: Limited liability partner)

Promotion of investment through the public-private partnership fundtaking advantage of investment by the TMG

Investment
Investment

Public-private partnershipfund (investment limited
partnership)

Solving social issues such as decarbonization
Investment

infrastructure

Operation
Public offering and selection by the TMG

Renewable energy

Startups

・・・

Flow of funds to facilitate the growth of startups

Operation business operator (GP: Unlimited
liability partner)＜Major funds formed by the TMG＞
Field

Infrastructure(renewableenergy, etc.)

Startups

Year ofestablishment

Amount ofinvestment by TMG

Major targets for investment

Sustainable energy fund2021

1 billion yen

Renewable energy generation plants, etc.

Energy creation/energy storage promotion fund2023

2 billion yen

Grid-scale battery facilities

Fintech support fund2021

0.2 billion yen

Fintech companies that can contribute to solving social
issues by spreading innovative financial services

Social impact investment fund2022

1 billion yen

Startups that look for impact in the wellness field

University-launched startup promotion fund2023

5 billion yen

VC funds that invest in university-launched startups
and deep-tech startups

Circular economy and natural capitalpromotion fund (provisional name)2024

3 billion yen

Startups in the fields of circular economy, nature
positive, etc.

Impact growth fund (provisional name)2024

10 billion yen

Startups in the later stage that look for impact

Name of fund31

Sustainablefinance

Support required in each stage of foundation/growth of asset managementbusiness is provided in an integrated manner

The TMG formulated the “Global Financial City: Tokyo” initiative in 2017 and has taken multi-faceted
support measures.
Stage

Preparation forfoundation

Needs

Wee need to know aboutprocedures necessary forfoundationandacquisition of licenses① Startup training

Initiatives by the TMG

Collaborative project with
FinCity.Tokyo
Information necessary for foundation isprovided

The seminar to provide informationis held about 4 times a year
(Major contents)
・Lectures on business registration
・Advice for supporting business
operators
・Lectures by those who have experiencein starting business・Individual consultation meetings⇒ The number of participants exceeds 700 and
8 of them have started a business (registered as
an investment management company)

Foundation

GrowthThe burden of costs
necessary for starting
asset
managementbusiness is heavy④

We want to attract more
funds for investment for
the expansion of scale② Financial support for covering
the costs of foundation③ Matching with Japanese andoverseas institutional investors

Subsidies are granted to cover the costs
required at the foundation stage
Financial support is granted to a business
operator registered as investment
management business up to 3 years (asubsidy up to 5 million yen is granted in
the first year) from its foundation.
(Costs subject to subsidies)
・Costs necessary for business registration
・Association membership fee
・Administrative and system costs⇒ 16 persons have received support forfoundation

Collaborative project with
FinCity.Tokyo

Opportunities for having
meetings with investors areprovided
Business opportunities are created byholding meetings with Japanese andforeign institutional investors that supply
funds for investment

32

Sustainablefinance

Support for starting and nurturing asset management business
is further expanded through new initiatives

Support for starting investment advisory and agency business (FY2024~)
・Subsidies for start-up expenses for businesses that obtain investment
advisory and agency business license and gain investment management
experience by advising other companies, etc.
⇒ In addition to traditional investment management business, support
is given to the foundation of advisory and agency business operators.
The base of future investment management companies is expanded byfacilitating the new entry of asset management players.

Support forstart-up costs

TMG

Investment Advisory
and Agency Business
investment
advice･Accumulate investment
management experiencethrough investment
advisory
servicesExpanding thebase of future
investment managers

Fund Management
Company

investinvestor

Forms funds and manages thembased on advice
Fund

Strengthened communication by national EMs (January 2024~)① Preparation of EM catalogs
・Independent new asset management companies (EMs) that have been registered andmade a notification as an investment management business are extracted to make their list.
⇒ This list is utilized to improve the recognition level of EMs among national andforeign asset owners and to match EMs with them.
② Announcement of distinct EMs
・Distinctive EMs are extracted from asset management companies in the list througha round-table meeting (hosted by FinCity.Tokyo) composed of national asset managementcompanies and institutional investors⇒ These EMs selected are announced and presented at an event hosted by the TMG
and FinCity.Tokyo (TAMF (Tokyo Asset Management Forum) for the purpose ofpromoting EMs.
33

Integrated startup support hub, Tokyo Innovation BaseStartup

GrowthCollaboration「Young generation is connected to the future」「Challengers and supporters are connected」

The TMG supports challenge by students and youths and backs

Promoting the collaboration between the government, big companies,

up their growthand universities and startups【Project to promote entrepreneurship nurturing program】
A human resources bank is established to back up challenge by youths.

【Open innovation promotion program】
Promoting open innovation of big companies【Collaboration with nationwide universities】
An entrepreneurship support program jointly operated by 13
universities nationwide is carried out.

【Establishment of innovation networks with TIB as a hub】
Innovation is promoted in the entire prefecture in collaboration withprivate businesses

GlobalConnect「Everyone is connected」「Connected to the world」

A platform that connects people is established

Creation of world-class startups【Establishment of startup database】
An integrated database of Japanese startups is established in English.

【Invitation of foreign VC/accelerators】
Support for preparing business models and forming human networks in view ofglobal operation【The world’s best TIB】
Development of ultra-high speed and ultra-low-latency local 5G environment.

【Collaboration with global bases】
Training programs and mutual dispatch of SU are carried out

Initiatives of Tokyo Innovation Base are translated into SusHi Tech TOKYO 2024
September 2023
Establishment ofSecretariat

November 27

Pre-openStart of event (once a week)

May 2024
Functions are
updated gradually

Full-fledged
opening

Linkage
May 15 and 16, 2024
@Tokyo Big Sight

34

“SusHi Tech Tokyo” should be a global trend
by holding this event at least once a year

Startups

Overseas event for startups
Foreign players visits different places
nationwide

Collaboration between thenational government and local
governments

Participation in global events held in
different countries
Raising awareness on SusHi Tech Tokyo

New encounters and connections
are turned into business

The results obtained in one year aretransmitted globally

The all-Japan system is used to transmit information on a
global scale in collaboration with the national government

Diverse ecosystem players provide support through diverse programs all the year round35

Startups

Multi-faceted support is provided to create and nurture startups
Support for creating and nurturing
university-launched startups

The TMG becomes the first customerof startups

A system is established to create many startups from universities

The TMG takes various initiatives by being the first customer(hub of “knowledge”) and to support their continuous growth【University-launched startup creation support project】○ Initiatives to translate excellent seeds and ideas of universities, etc.
into commercialization are facilitated by providing accompanied support
and financial support in collaboration with private support organizations○ The development of internal system is supported in accordance witheach university’s need
【University-launched startup promotion fund 】○ A public-private partnership fund is formed to finance universitylaunched startups and R&D-type startups.
○ The TMG plans to invest 5 billion yen out of the overall budget of
10 billion yen.

of startups by procuring their products and services【Interactive startup collaboration project】○ This project aims to help the staff and startups havedialogues to identify problems and visualize their cause andsolve issues in the field.
○ 10 topics are selected this FY to publicly seek startups.
【System to propose projects by startups to the TMG】
○ Under this initiative, the TMG accepts proposals to utilize
products and technologies of startups for solving issues
faced by the TMG. They are experimentally introduced
toward public procurement.
○ The TMG will start to accept proposals in September 2023
and experimentally introduce them.

36

Initiatives of the TMG to realize the City
with the Global Standard for Business in English

EnglishComprehensive counter
for foreign companies

Counter to transmit
information overseas【Access to Tokyo】【e-business concierge】

Overseas
officeAI-powered
consultations

Principal financial support/accompanied support measures【Project to discover and invite foreigncompanies】
Market research/consulting services, searchof properties, introduction of staffing
companies for the operation in Tokyo

Support in English【Business Concierge Tokyo】
Diverse support needs from business to daily life are met in English.
【Tokyo One-Stop Business Establishment Center】
Integrated counter for procedures to establish a corporation (multilingual services)

Support in English【Project to provide temporal
offices】
Subsidies for renting temporal
offices to conduct prior market
research【Office establishment subsidy】
Subsidies are granted to cover expert
consultation fees, recruitment costs, andinitial office costs, and businessregistration fee for the operation in Tokyo【Subsidy for infrastructural
support for foreign financial firms】
Subsidy to cover the costs such as rent
and accessories in the second and third
years【Project to provide localization support for GX-related foreign companies】／【Project to provide localization support green-finance foreign companies】

The recruitment costs, personnel costs, rent, etc. required for the operation in Tokyo are subsidized for foreign companies engaged in green transformationand green finance. Integrated and comprehensive support is provided such as consulting services and business matching.

The procedures to apply for subsidies can be made in English from FY2024
Utilization of national strategic special zone

【Development of business, living, and educational environments】
・ International business hubs are developedwith a focus on the financial field in Otemachi, International hubs
Yaesu, and Kayabacho near the Tokyo station.
・ An environment in which foreigners can receive
medicalmedical care in English will be established, such as bycare
expanding the scope of care provided by foreign doctors.
・International schools for foreign students are developed
Education(Examples: Azabudai Hills, north of the Shinagawa station, etc.)

Utilization of Special Zone for Asian Headquarters

Finance/taxation system【Interest subsidy by the national government】
・ Interest subsidy to develop medical and educational institutions forforeigners【taxation for the promotion of capital investments (corporate tax) 】
・Special depreciation or tax exemption is applied to capital investments byforeign companies for research and development in environment, medicalcare, and semiconductor.
37

EnglishSupport for market entry in English at Business Concierge Tokyo

・The TMG provides foreign companies and foreigners with support by meeting diverse support needs from business to daily life inEnglish in a one-stop manner.
・The counters are established at three places in Tokyo.
① Marunouchi “JP Tower”, ② Akasaka “JETRO Headquarters” (Tokyo One-Stop Business Establishment Center is also located),③ Yurakucho “Tokyo Innovation Base” (to be open in FY2024)
・The Hong Kong office is established.
Support for foreign financial firms

Support for all foreigners and foreign companies◆ Support for business
・Referral of attorneys/accountants suited for needs (referral from the list of specialists)
・Business matching support (referral of companies in accordance with the needs ofthose who seek consultation)◆ Support for financing
・Provision of information and advice on means of procuring funds that can be usedmainly in the establishment phase and accompanied visits to the counter◆ Support for daily life
・Provision of information related to administrative procedures and daily life
・Referral of multilingual hospitals and schools◆Finance one-stop support service

・Provision of information and advice on finance-related legal systems andprocedures for acquiring financial license
・Referral of financial specialist (attorneys, accountants, etc.) and contacts ofrelated organizations in accordance with the nature of consultation
・Subsidy application support for establishment of office (costs for consultation
services with specialists and recruitment)

Support for foreign companies invited by the TMG◆ Support for office establishment
・Support is provided to help companies, etc. invited by the TMG establish its office.
Preparation of forms forinterview and planning

Progress management and support
in line with planning form

Search for candidate offices byaccompanying a visit to a real-estatecompany or looking for properties onbehalf of the company

Support for businessmatching

Establishment ofofficeBusiness matching for
helping companies stayin Japan38

EnglishSupport for starting business in English
at Tokyo One-Stop Business Establishment Center

・The counters for procedures required to establish a corporation such as certification of articles of incorporation, registration, tax affairs,
pension/social insurance, and certification of residential qualification are integrated in multiple languages.
・The counters are established at three places in Tokyo.
① Akasaka Counter, ② Shibuya Satellite Counter, and ③ Marunouchi Satellite Counter (It will be transferred to “Tokyo Innovation Base”
and the “Yurakucho Satellite Counter” will be established)・ Specialists such as notaries, certified social insurance labor consultant, certified tax accountants, and judicial scriveners dispatched from theministries and agencies and the TMG are assigned to the booths to provide consultation services (online consultation services are available)
for starting business as well as support for creating application documents and accept those applications.

The counter of Business Concierge Tokyo* and the counter of the Tokyo
Employment Consultation Center* are established on the same floor.
* The counters aim to help global companies and startups accurately understandemployment rules in Japan and smoothly operate. Bilingual attorneys and certifiedsocial insurance labor consultant provide consultation services.
39

SustainablefinanceEnglishStartups

Strategic global promotion
Public-private collaborative promotion by “FinCity.Tokyo”

Collaboration with City of London•あ Tokyo has concluded MoU on
exchange and cooperation in thefinance field with City of London(United Kingdom)•
The TMG and City of London havestrengthened their collaboration
through co-hosting seminars with theaim of growing as the global
financial hubs.
Tokyo-London Finance Seminar (cohosted with City of London)

・In April 2019, the first public-private collaborative financepromotion organization in Japan called “FinCity.Tokyo” wasestablished.
・ The public and private sectors collaborate to carry out
promotional activities in other countries with the aim ofappealing the attractiveness of Tokyo as a global financial city.
(Activities in FY2023)
Global Forum (New York)Singapore FinTech Festival (Singapore)
Japan Securities Summit (London) (March 2024)(Seminar held in New York)• Exchange with foreign financial promotion organizations

A2T_
London Base A2T_Paris Base
A2T_San Francisco Base
A2T_Bengaluru Base

Added in FY2024

FinCity.Tokyo Global Forum（New York）

The TMG collaborates and work with diverse
entities to carry out strategic promotional
activities in other countries
A2T_Singapore Base

Overseas counter to attract foreign companies “Access to Tokyo (A2T)”•あ ”Access to Tokyo” responds to inquiries from foreign companies
interested in establishing an office in Tokyo or market
information in Japan local time in their local languages andintroduces various measures for attraction.
• In addition to the existing offices (London, Paris, San Francisco,and Singapore), Bangalore is added in FY2024 to reinforce theinformation transmission function in India and Middle East.

Participating and setting a booth in global events••

The staff visit financial and startup
events held in different countries tostrengthen face-to-face networks.
The attractiveness of Tokyo and its
support measures as a global
financial city are presented throughsetting a booth in events.

40

English

New attempts for development of living and business environments in English

The educational environment is enhanced by inviting and improving international schools, because highly skilled professionals
give importance.
• When foreign financial companies are invited, it is required to develop a better living environment where highly skilled
professionals can work and live comfortably. There are many requests for enhancement of international schools.
 Current situations are identified and, based on that information, a support scheme is examined to invite andenhance international schools in Tokyo・Examination of specific operational case study, support scheme
Promotion of investments from other countries and globalization of companies by utilizing AI-powered translation systems
 The utilization of advanced AI-powered translation systems (finance specialized models) is promoted with the aim of enhancing
English information disclosure that visualizes corporate activities in Japan from other countries. The parties concerned
work together to improve the precision of AI-powered translation and raise awareness on its utilization with a view toattracting more investments and promoting global expansion.
Machine learning of AI on
IR materials is accelerated
in collaboration with parties
concerned

etc.
Provision of high-precision
AI-powered translation
Companies in Tokyo

Utilization of seminars
held by FCT

Raising awareness on utilization of
AI-powered translation

etc.

Market “visualization”
Enhancement of English
information disclosure

Attraction of investments

Foreigninvestors

Global operation

TIB promotes initiatives to strengthen English language skills and supports global challenges


Developing activities to improve English language skills at the Tokyo Innovation Base (TIB) in cooperation
with various private businesses involved in startup support, and creating opportunities to present inEnglish at global events, etc.

41Promotion System for Realizationof Tokyo as an “Innovation and
Financial Hub in Asia” toward
Realizing a Sustainable Society

Diverse players working together to contribute to the realization of a sustainable society

Government

Industry
Association

Exchange

StartupIndustry
Association

etc.

University
TIB member
etc.

etc.

Innovation

VC

etc.

Accelerator・
Incubation

etc.

Local
government

etc.

etc.

Finance

City of London(TMG MOU
concluded)

FCT Member
Company（54 companies）
Partner Financial
Institutions（19 institutions）*See p. 30.