TMT 2025

JAPAN Trends and Developments Contributed by: Keiji Tonomura, Minh Thi Cao Koike, Akira Komatsu and Yuki Matsumiya, Nagashima Ohno & Tsunematsu

• Qualification (ie, licence of taxi business operator). • Management and operational systems. • Financial capacity for damages. The details of each requirement are provided in the Guideline. The competent authority may impose several conditions on the applicants when granting permission, and the permission is valid for two years. Violation of these conditions inhering in the granted permission may result in administrative penalties such as suspension of business or revocation of permission. Although the Private Vehicle Utilization Business is limited to taxi business operators, discussions on the legal framework of ride-hailing for non- taxi operators are ongoing. It is essential to con - tinue monitoring the progress and direction of, and legislative developments issuing from, these discussions. Web3 LLC-type DAO The Japanese government has been looking to Web3 as an engine of growth of the Japanese economy and therefore took several measures in 2024. Among them, the legislation of DAO (decentralised autonomous organisation) is particularly noteworthy. On 22 April 2024, the amendments to the Cabinet Office Order on Definitions under Article 2 of the Financial Instru - ments and Exchange Act (“DAO Amendments”) came into effect. As a result of the DAO Amendments, tokenised equity interests in DAOs in the form of GKs (“ godo kaisha ”) that satisfy the statutory require - ments may now be classified as Article 2(2) Securities, which are more relaxed regulations than Article 2(1) Securities under the Financial Instruments and Exchange Act. It is expected

that establishing DAOs would be accelerated under the DAO Amendments. Stablecoins At the private-sector level, companies’ efforts regarding stablecoins have progressed. In 2022, the amendments to the Payment Services Act introduced new regulations on “electronic pay - ments instruments” and stablecoins may be issued as electronic payments instruments under the Payment Services Act. Although stablecoins in compliance with the Payment Services Act have not been issued yet, several companies have already announced stablecoins projects. For example, on 5 September 2024, Progmat, Inc., which is a Web3 start-up invested in by major banks, announced a project of a cross- border payment platform using the API of Swift. Some stablecoins projects under the Payment Services Act are expected to be launched in 2025. Start-Ups In the TMT area, start-ups play an important role in accelerating innovation and the Japanese government has been supporting start-ups. The highlights of the government’s initiatives for start-ups in 2024 are as follows: • amendments to the Limited Partnership Act for Investment; • introduction of “Venture Capitals: Recommen - dations and Hopes”; and • amendments to taxation of tax-qualified stock options. Amendments to the Limited Partnership Act for Investment The Limited Partnership Act for Investment has been amended to expand the scope of invest - ment to allow the limited partnership to invest in cryptocurrency and equity interests in GK. These

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