JAPAN Law and Practice Contributed by: Tsuyoshi Ikeda, Aya Yasui, Takuya Ohata and Kohei Kohara, Ikeda & Someya
2.2 Failure to Notify If a party obliged to notify fails to make/file a notifica - tion, it is subject to a criminal fine of up to JPY2 mil - lion. No such penalty has yet been imposed on any party, but in June 2016 the JFTC issued a warning on a “warehousing” case; see 2.13 Penalties for the Implementation of a Transaction Before Clearance for further details. 2.3 Types of Transactions Note that the thresholds for notification vary in accord - ance with the following types of transactions: • share acquisitions; • mergers; • joint incorporation-type or absorption-type com - pany splits (demergers); • joint share transfers (as defined by the Companies Act); and • acquisitions of businesses or assets. Interlocking directorships (one type of business com - bination) are subject to merger review by the JFTC but are not subject to mandatory notification obligation. More specifically, the above-mentioned acquisitions of businesses or assets include: • accepting assignment of the whole or a substantial part of the business of another company; • accepting assignment of the whole or a substantial part of the fixed assets used for the business of another company; • taking on a lease of the whole or a substantial part of the business of another company; • undertaking the management of the whole or a substantial part of the business of another com - pany; and • entering into a contract that provides for a joint profit and loss account for business with another company. Internal restructurings or reorganisations within the same company group are not subject to notifications in general. The AMA does not technically require noti - fication regarding operations that do not involve the transfer of shares or assets (eg, shareholders’ agree - ments or changes to articles of association), although
Although not directly related to the foregoing, in April 2025, the JFTC issued a cease-and-desist order against Google, finding that Google has been commit - ting an act that violates a provision of Article 19 (falling under paragraph (12) [Trading on Restrictive Terms] of Unfair Trade Practices) of the Act. As such, the JFTC is strengthening its vigilance against unfair practices conducted by tech giants and preparing to enforce new digital regulations to ensure fair competition.
2. Jurisdiction 2.1 Notification
Notification is compulsory if the transaction meets a certain threshold under Chapter 4 of the AMA and relevant regulations. A transaction within the same company group is generally exempt from the obliga - tion of notification. Meanwhile, the JFTC can review any merger below the notification threshold, either on its own initiative or through a voluntary consultation with the merging party or parties. Specifically, in the Merger Review Policies revised in 2019, the JFTC recommends that parties whose domestic sales amounts fall under the thresholds of the notification have a voluntary consul - tation prior to the notification process when the total consideration for the acquisition (transaction value) will exceed JPY40 billion and the scheduled transac - tion is deemed to affect domestic consumers, satisfy - ing one of the following: • the business base or research and development base of the acquired company is located in Japan; • the acquired company conducts sales activities targeting domestic consumers, such as creating a Japanese website or using a brochure in Japanese; or • the total domestic sales of the acquired company exceed JPY100 million. In practice, the targeted parties typically consult with the JFTC voluntarily prior to filing a notification, as described in 3.8 Pre-Notification Discussions With Authorities . Without the voluntary consultation, the parties could be requested to provide further related information.
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