JAPAN Law and Practice Contributed by: Shinya Tago, Atsushi Fukasawa, Hiroshi Iida and Landry Guesdon, Iwata Godo Law Offices
3. White-Collar Offences 3.1 Criminal Company Law and Corporate Fraud In addition to the offences covered by the PC and other laws (see 1.1 Criminal Offences ), the CA also imposes sanctions against the fraudulent activities of corporate officers and employees. It specifies many types of corporate crime, including the following. Special (Aggravated) Breach of Trust A director can be criminally liable for aggravated breach of trust under the CA if they breach their duties in order to unduly seek their own benefit or in the interest of a third party, or to inflict damage on the company’s assets (imprisonment of up to ten years and/or a fine not exceeding JPY10 million). Endangering a Company’s Assets This crime includes: • making false statements or concealing facts about the company’s capitalisation or subscription pay - ments (imprisonment of up to five years and/or a fine of up to JPY5 million); • acquiring shares unlawfully at the company’s expense; • distributing a dividend in breach of the law; and • disposing of corporate assets in speculative trans - actions outside the scope of the corporate objects. Other CA Offences These include: • using false documentation; • disguising capital contributions through borrow - ings; • providing consideration for the exercise of share - holders’ rights; and • bribery (a director can be criminally liable for giving or accepting a bribe under the CA if they accept, solicit or promise to accept property benefits in connection with corporate duties in response to a wrongful request). Fraud and embezzlement are covered by the PC.
so when it is necessary and reasonable in order to perform their work. Obligation to Share or Legal Privilege There is no legal obligation to report the results of an internal investigation to the authorities as a matter of course, but there is also no special legal privilege regarding internal investigations. 2.6 Prosecution Only public prosecutors have the authority to pros - ecute (Article 247 of the CCP). In most cases, pros - ecutors ultimately decide to prosecute criminal cases based on the results of a police investigation. Howev - er, prosecutors may proceed with investigations inde - pendently. If the administrative authorities become aware of the existence of a crime in connection with the laws and regulations under their jurisdiction, they must file a complaint with the police or the prosecu - tor’s office. The prosecutor’s office decides at its discretion whether to prosecute by considering (for example): • the possibility of proving the offender’s guilt; • the severity of the damage; and • the conclusion of a settlement or the chances of reaching one. However, a criminal case will be commenced if the Committee for the Inquest of Prosecution resolves that the case should be prosecuted, even if the pros - ecutor has decided otherwise. There are no clear prosecution rules or guidelines. 2.7 Deferred Prosecution Under the CCP, there is no deferred prosecution sys - tem or non-prosecution agreement scheme; however, see 4.3 Plea Agreements, Co-Operation, Self-Disclo- sure and Leniency .
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