Japan

The Japan Financial Services Agency (FSA) has proposed updates to its corporate governance code, focusing on annual report filings, board diversity, and senior executive remuneration. This amendment aims to enhance transparency, accountability, and governance standards for companies operating in Japan, aligning with global best practices.

Circle's USDC stablecoin has received regulatory approval from Japan's Kanto Regional Financial Bureau, becoming the first and only USD-backed stablecoin authorized for use in Japan. This follows Japan's lifting of its ban on foreign-currency-backed stablecoins two years ago and represents a significant regulatory shift for cryptocurrency markets in the country. The approval enables SBI VC Trade to launch USDC trading trials with plans for full rollout, positioning USDC as a compliant option for institutions and retail users.

Japanese authorities are increasing enforcement of anti-money laundering regulations targeting Chinese payment platforms WeChat Pay and Alipay, with retailers discontinuing acceptance due to suspected money laundering activities. This reflects broader regulatory crackdowns on cross-border financial crime and digital payment systems in Japan.

Apple has modified its App Store rules in Japan to comply with the Mobile Software Competition Act, which requires allowing alternative payment methods to avoid Apple's commissions. However, developers argue that Apple's continued 15-20% commissions on external payments undermine the law's intent, leading to calls for enforcement by the Japan Fair Trade Commission. This reflects ongoing global regulatory scrutiny of app store monopolies and competition compliance.

Japan's cabinet has approved a draft amendment to reclassify cryptocurrencies from payment tools to financial products under the Financial Instruments and Exchange Act, introducing bans on insider trading, mandatory annual issuer disclosures, and significantly increased penalties. The new regulatory framework is expected to take effect in fiscal 2027 and will expand the enforcement authority of the Securities and Exchange Surveillance Commission.

Japan has implemented a mandatory emissions trading scheme, representing a significant regulatory shift toward carbon pricing and climate accountability. This requires companies to comply with new emissions reporting and trading requirements, impacting climate-related financial regulations.

Japan's Sustainability Standards Board (SSBJ) has issued new sustainability reporting standards aligned with the ISSB framework, making ESG disclosures mandatory starting in 2027. The standards require listed companies and large corporations to report on climate-related risks and opportunities, integrating sustainability metrics into financial reporting.