JAPAN Law and Practice Contributed by: Keisuke Hatano, Takeshi Nagase, Takato Fuki and Tomoaki Katayama, Anderson Mori & Tomotsune
Second, RWA tokenisation. The tokenisation of assets that have traditionally lacked liquidity, such as real estate (STOs for beneficial interests), government bonds, private placement bonds, unlisted shares, renewable energy certificates and carbon credits, is under ongoing consideration. Issues that May Affect Blockchain Adoption in the Next 12 Months Preparations for the enforcement of the Amendment Bill regarding the transition of crypto-assets under the FIEA are the primary issue. The overall structure of the Amendment Bill is as follows. First, as a partial amendment to the FIEA, new provisions on informa- tion disclosure systems, business regulations and unfair trading regulations (including insider trading) related to crypto-assets will be established. Second, under the amended PSA, the crypto-asset exchange business under the current PSA and the portion of the PSA pertaining to crypto-asset brokerage activi- ties and crypto-asset service brokerage businesses. Consequently, regulations concerning crypto-asset transactions will be centralised under the FIEA. The enactment of Cabinet Orders, Cabinet Office Orders and self-regulatory rules in preparation for enforce- ment will directly impact industry practices. Harmonisation of Blockchain Businesses and Intellectual Property Laws Regarding the relationship between the sale and purchase of NFTs and copyright, under Japanese copyright law, there is an established practical under- standing that NFT token holders do not automatically acquire the copyrights (such as the right of reproduc- tion, the right of public transmission and the right of adaptation) pertaining to the original work. The trans- fer of copyright requires a transfer agreement based on Article 61, Paragraph 1 of the Copyright Act. Con- sequently, a model has become established in NFT marketplaces whereby the copyright itself is retained by the original rights holder, while the terms of use permitting the purchaser to view, display on social media and exhibit commercially are specified in sepa-
dents and foreign companies. It enables companies to apply for and receive approval for new and innovative projects and services that are not yet contemplated under current regulations, without the need to amend existing regulations. Approved projects may not be carried out as a business, but rather as a proof of concept or demonstration, under certain conditions, including limitations on the number of participants and the duration of operations. There are no limita- tions on the business sectors that can benefit from the sandbox. 1.1.3 Regulation of Blockchain Technology The Japanese government generally takes a posi- tive view of the use of blockchain technology across various businesses. For instance, in June 2019, the Japanese government published an “Action Plan of the Growth Strategy” 1, which discussed the impor- tance of the use of blockchain technology, stating that “Artificial intelligence (AI), the Internet of things (IoT), robots, big data, blockchain... are general pur- pose technology (GPT) that broadly affect all indus- tries, similar to the adoption of electric power from the 19th to 20th century and information technology (IT) inroads through the end of the 20th century”. In addition, in July 2020, the Japanese government published a “Follow-up for Growth Strategy” 2, stat- ing that, “In a decentralised financial system based on blockchain technology, where there are no regu- lated intermediaries, the Japanese government will lead the international discussion by actively contrib- uting to the Blockchain Governance Initiative Network (BGIN) to achieve financial administrative objectives, such as financial system stability, user protection and prevention of money laundering”. On 18 June 2021, the Japanese Cabinet approved the “Growth Strategy (2021)”, which includes provisions to facilitate block- chain technology. The development of an ecosystem surrounding NFTs and security tokens is also specifi- cally mentioned in the “Plans for Implementing Growth Strategy” paper published on the same date. Furthermore, it was stipulated in a paper entitled “Grand Design and Action Plan for a New Form of Capitalism 2023 Revised Version”, which was approved by the Cabinet in June 2023, that the Japa- nese government would foster the development of an
rate terms and conditions. 1.1.2 Regulatory Sandbox
The Japanese regulatory sandbox was introduced in June 2018 and can be used by both Japanese resi-
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