Publication of the finalized amendments to the „Points to Note on Disclosure of Corporate Affairs, etc. (Guidelines for Disclosure of Corporate Affairs, etc.)“ after public consultation

The FSA has concluded the amendment process for the „Points to Note on Disclosure of Corporate Affairs, etc. (Guidelines for Disclosure of Corporate Affairs, etc.)“. This culmination follows a period of public consultation.
According to the revised guidelines, when an issuing company engages in the offering or sale of securities with a total value exceeding 100 million yen, it is mandated to submit a securities registration statement to the relevant authorities. However, a notable exception exists for shares issued as stock-based compensation to directors and employees. In such cases, the issuing company is exempted from filing a securities registration statement, provided it has entered into an agreement with its directors and employees that restricts share transfer.
The recent amendments bring clarity to the application of this special provision. Notably, even if an issuing company’s stock-based compensation rule includes a provision to lift the restriction on share transfer in unforeseen events, such as the retirement or resignation of a director due to justifiable causes, or organizational restructuring of the issuing company, the special provision remains applicable. The revised guidelines specify that the requirements for the transfer-restricted period are considered satisfied in these circumstances. Consequently, the filing of a securities registration statement is not deemed necessary.
These finalized amendments officially came into effect on 26 December 2023, marking a significant development in the regulatory framework surrounding the disclosure of corporate affairs in securities transactions. Of note, an English translation of the amendments was not available at the time of writing, as the Guideline for the Disclosure of Corporate Affairs are still listed in the FSA Laws & Regulations section in their version of January 2018.