If you intend to register a fintech company in Japan, you should remember that it’ll be deemed a financial instruments business operator & required to register. As regards the establishment of an AIF in Japan, there’s no special regulations applicable to the activities of such institutions (which means that they’re regulated under the FIEA).
Regulation of Crypto Activities in Japan
If IA is used by investment advisors or managers, it’s regulated by FIEA in the same way as if the robots were living advisors. There’s no specific laws regulating the use of DLT in business in Japan.
Japan: Regulation of Crypto Exchanges & ICO
Provision of cryptocurrency exchange services in Japan is governed by the PSA. Something more or less specific about ICO regulation in Japan can be said after the adoption of amendments to FIEA in late 2020.
Japan: Information Protection & Cybersecurity
As regards opening a fintech business in Japan & ensuring its security, companies can use the FISC’s guidelines for banks & financial Institutions. PIPA applies to individuals processing & transmitting personal data. According to PIPA:
- Personal information that’s unnecessary for achieving the purpose of using personal information mustn’t be processed;
- Personal information mustn’t be transferred to 3rd parties without the consent of its owner;
- Personal information must be stored securely;
- Owners of personal information must be informed about what data an operator has in their possession;
- Personal information must be deleted at the request of its owner.
Japan: IP Protection
Copyright or patent laws can be used to protect software in Japan. However, because software patenting isn’t possible in all countries, connection between a program & device or computer system it’s used on must be established.
Japan: Protecting Trade Secrets
Pursuant to the Prevention of Unfair Competition Act, trade secrets are defined as production or sale methods or any other operational or technical information that can be used for commercial activities.
Disclosing such information is punishable by criminal prosecution. Disclosure of trade secrets in court may be prohibited if either of the parties specifically requests it.
Japan: TM Protection
Full TM protection in Japan is provided only after a TM is registered. Incomplete protection may be available through the Unfair Competition Act; however, a TM owner must prove that their services/products are well known to consumers.
Japan: Protection of IPR
As regards IPR protection in Japan, infringers may be required to recover damages suffered due to IPR infringement. To prevent a recurrence of an IPR violation, injured parties can obtain an injunctive relief or file a lawsuit against infringers. IPR infringement is punishable by criminal penalties.
The number of entrepreneurs wishing to register a fintech company in Japan is constantly growing. To meet this demand & encourage further investment in the country’s economy, the Japanese government keeps coming up with new incentives.
If you’re interested in opening a fintech business in Japan or seek advice on fintech regulation in Japan, please consider contacting IQ Decision UK. Our experts will also be happy to assist you in:
- opening a fintech startup in Japan;
- launching an investment project in Japan.