JAPAN Law and Practice Contributed by: Tsuyoshi Ikeda, Aya Yasui, Hiroko Fukushima and Kohei Kohara, Ikeda & Someya
3.6 Penalties/Consequences of Incomplete Notification
• the market ranking and market share of the major players with which the parties have a horizontal or vertical relationship. Certain documents must be attached, depend - ing on the type of transaction, such as a copy of the definitive agreement, financial statements and annual reports of the notifying party, a list of major shareholders, or the minutes of the share - holder meeting or board meeting that approves the transaction. If the filing is made by an attor - ney on behalf of the notifying party, a power of attorney (POA) is required. It should be noted that the POA is required even at a pre-notifica - tion process. In addition to the required information, the JFTC often requests – usually on a voluntary basis – additional information to review the transactions substantially, such as definitions of the product and geographic markets, the degree of com - petition between the parties, competitive pres - sures – including those arising from competitors, import products, new entries or customers – and efficiencies. Furthermore, the parties’ internal documents can be requested by the JFTC, including pres - entation materials and the minutes of meetings such as board of directors’ meetings, materials used in analysis and decision-making processes and the emails of the persons concerned, which may refer to synergies, effects or competitive concerns, typically at a later stage of the review. Although the documents to be submitted are not required to be certified, notarised or apostilled, certifications by the company representative are required for copies of certain documents.
If the notification is deemed incomplete, the JFTC will not accept it, in which case it may recommend the parties withdraw and refile an amended notification. Nevertheless, prior to said formal notification, parties can engage in a pre-notification consul - tation, in which a draft notification is submitted to the JFTC for review (a so-called draft check). This draft check process usually takes between a few days and a couple of weeks. If a submit - ted draft notification is deemed incomplete, the JFTC can request the parties to amend the draft further. 3.7 Penalties/Consequences of Inaccurate or Misleading Information Filing inaccurate or misleading information is subject to a criminal penalty of up to JPY2 million, though no such penalty has yet been imposed, as far as is known. In addition, the JFTC can issue a cease-and- desist order at any time if it finds significant false or misleading information in a notification, regardless of the time limit on its ability to issue an order. In other words, the JFTC can over - turn its clearance decision at any time if there is significant false or misleading information in a notification. 3.8 Review Process It should be noted that the parties concerned can consult voluntarily with the JFTC in advance through the pre-notification process. When the JFTC accepts a formal notification, the statutory waiting period will commence (Phase I review).
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