JAPAN Law and Practice Contributed by: Yutaro Fujimoto, Yurika Masakane, Hirokazu Tanaka and Yutaro Kato, Nagashima Ohno & Tsunematsu
corporate split (collectively “business transfer”), made by an operator of an electricity business. Under the Electricity Business Act, an operator of an Electricity Generation Business, Specified Electricity Wholesale Business, Specified Electricity Transmis- sion and Distribution Business, or Electricity Retail Business may implement a business transfer at its own discretion. However, an operator of a General Electricity Transmission and Distribution Business, an Electricity Distribution Business or an Electricity Transmission Business may not implement a business transfer without the prior written approval of METI, without which the business transfer cannot take effect. Further, the Electricity Business Act requires an opera- tor of a General Electricity Transmission and Distribu- tion Business, an Electricity Distribution Business or an Electricity Transmission Business to submit prior written notification to METI if the operator sells or dis- poses of the facility used to conduct that business. If METI considers that such sale or disposition adversely affects the operation of that business, METI may issue an order to change the terms of, or prohibit, such sale or disposition. Under the Electricity Business Act, a person who has acquired facilities used to conduct an electricity busi- ness must submit a written notification after the acqui- sition to METI. Renewable Energy Power Plant With regard to the sale of renewable energy power plants subject to the feed-in tariff regime (“FIT Regime”) or feed-in premium regime (“FIP Regime”), since 1 April 2024, the seller and the purchaser have been required to conduct briefing sessions for local residents pur- suant to the Renewable Energy Special Measures Act (see 1.6 Recent Changes in Law or Regulation ). Nuclear Power Plant The Act on the Regulation of Nuclear Source Mate- rial, Nuclear Fuel Material and Reactors (Act No 166 of 1957, as amended) provides that an operator of a nuclear plant may not implement an amalgamation or merger or a corporate split without the prior written approval of the Nuclear Regulation Authority (NRA). In addition, a person who intends to acquire a nuclear
power plant must obtain the permission of the NRA before the transfer. Anti-Monopolisation More generally, under the Act on Prohibition of Private Monopolisation and Maintenance of Fair Trade (Act No 54 of 1947, as amended), if a merger, amalgama- tion, company split or transfer of a business substan- tially restricts competition in a particular field of trade, the Japan Fair Trade Commission (JFTC) may issue an order forbidding such actions or changing the terms of such actions. 1.5 Central Planning Authorities METI and ANRE The ministry responsible for the energy policy is METI. The Agency for Natural Resources and Energy (ANRE), a government organisation under METI, is in charge of proposing and implementing the energy policies adopted by the government. ANRE also has inde- pendent authority to promulgate rules to implement those policies. As such, except for safety regulations, most regulatory aspects of the electricity industry are delegated to ANRE. OCCTO As a part of the recent reforms of the electricity indus- try, the Organisation for Cross-Regional Co-ordination of Transmission Operators (OCCTO) was established in 2015. All licensed operators of electricity business- es must join OCCTO, which has the power to give directions to operators in order to achieve its mission. While OCCTO has been expanding its mission since its establishment (eg, monitoring the demand and supply of electricity at national level, operating the capacity market, providing access to the power grid network, managing the FIT surcharge), the fundamental purpose of OCCTO is to co-ordinate the transmission networks in Japan in accordance with the Network Codes (which are issued by OCCTO and approved by METI), so that the transmission networks are integrated and operated, maintained and developed in a consistent manner. The Network Codes provide the rules on how network operations are to be performed (including the proce- dures required by a network user in relation to access- ing the networks). All electricity business operators,
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