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Small and Medium Enterprise Agency The Act for Facilitating New Business Activities of Small and Medium-sized Enterprises Came into Force

On July 1, 2016, the Act for Facilitating New Business Activities of Small and Medium-sized Enterprises (Act for Strengthening the Management of SMEs, etc.; hereinafter referred to as the “Act”) came into force.

Targeting small and medium enterprises (SMEs), micro businesses, and mid-ranking companies (hereinafter referred to as entities including SMEs and micro businesses), the Act stipulates: [i] the formulation of guidelines by the minister having jurisdiction over a business category based on each business field and [ii] special treatments for supporting the efforts of entities including SMEs and micro businesses, e.g., reduction in fixed-asset tax and additional financial support.

1. Purpose of the Act

Aiming to respond to changes in Japan’s socioeconomic situation, including the decrease in the working population and the intensification of global competition between companies, and to strengthen the management of entities including SMEs and micro businesses, the Act stipulates that each minister with jurisdiction over a business category is to formulate guidelines by industrial field and that special treatments are to be provided to support the efforts of entities.

2. Outline of the Act

1) Formulation of guidelines for the improvement of management skills of entities based on the characteristics of each business field

Each minister with jurisdiction over a business category is to formulate guidelines for individual business fields on efforts to be made by business operators in order to strengthen management practices, such as analyzing customer data, utilizing IT, enhancing financial management, and developing human resources.

Note: Specifically, the guidelines encompass such fields as manufacturing, wholesale and retail, food services, home-meal replacement, accommodation, medical care, nursing care, child care, truck transportation industry, ships, and automobile maintenance.

2) Supporting efforts of entities including SMEs and micro businesses in improving their business management

  1. Approval of plans for improving management skills and support measures
    To receive the support, entities including SMEs and micro businesses are required to prepare business plans for improving their management skills (management improvement plan), describing how they improve human resource development and cost management or conduct business investment. Upon being approved by a minister, the entities will be eligible for special support treatments, including a reduction in fixed-asset tax involving machinery or devices (by half, for three years; targeting entities with capital of 100 million yen or less) and additional financial support, e.g., low-interest loans or guaranty of liabilities.
  2. Support from accredited organizations and experts that support business innovation and other efforts
    The approved entities will also be eligible for receiving support in preparing the plans from accredited organizations and experts that support business innovation and other efforts, mainly including chambers of commerce, chambers of commerce and industry, and national federation of small business associations, financial institutes, and professionals.

3) Streamlined application procedures

When applying for the special treatments, entities are only required to submit a substantially two-sheet application form by post; they are not required to directly submit it at a contact counter.

Release date

July 1, 2016

Division in Charge

Policy Planning Division, Business Environment Department, Small and Medium Enterprise Agency

Ministry of Economy, Trade and Industry1-3-1 Kasumigaseki, Chiyoda-ku, Tokyo 100-8901, Japan Tel: +81-(0)3-3501-1511
Copyright Ministry of Economy, Trade and Industry. All Rights Reserved.