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  5. Part of the Act for Partially Amending the Industrial Competitiveness Enhancement Act and Other Related Acts Has Come into Effect

Part of the Act for Partially Amending the Industrial Competitiveness Enhancement Act and Other Related Acts Has Come into Effect

June 16, 2021

The Act for Partially Amending the Industrial Competitiveness Enhancement Act and Other Related Acts was promulgated today. Among the systems to be implemented under this Act, the following have come into effect: (1) the special provisions for achieving virtual-only shareholders' meetings; (2) the regulatory sandbox, and (3) the system for installing cutting-edge equipment, etc.

Note: The expansion of the scope of grants provided by the Organization for Small & Medium Enterprises and Regional Innovation will come into effect on June 17, 2021.

Outline of the systems that have come into effect as of today

(1) Establishment of special provisions for achieving virtual-only shareholders meetings

The current Companies Act stipulates that when convening a shareholders' meeting, a "location" must be specified. This makes it difficult to hold a shareholders' meeting only in a virtual space (a so-called virtual-only shareholders' meeting). To address this, a system aimed at listed companies has been created regarding "shareholders' meetings without a location," and special provisions have been established to make virtual-only shareholders' meetings possible.

(2) Transfer of the regulatory sandbox

The aim of the regulatory sandbox is to achieve regulatory reforms and other initiatives by conducting demonstrations using innovative technologies, etc. without being subject to regulations by limiting the duration and participants.

The Act on Special Measures for Productivity Improvement will be abolished, and the system for demonstrating new technologies, etc. (the regulatory sandbox) included in it will be transferred to the Act on Strengthening Industrial Competitiveness.

(3) Transfer of the system for installing cutting-edge equipment, etc.

The system for installing cutting-edge equipment, etc. was a measure included in the Act on Special Measures for Productivity Improvement. It is intended to support small and medium-sized enterprises’ efforts to improve labor productivity through capital investment.

The Act on Special Measures for Productivity Improvement will be abolished, and the system for installing cutting-edge equipment, etc. will be transferred to the Small and Medium-sized Enterprises Business Enhancement Act.
Note: The special provisions on fixed asset tax for SMEs whose plans to install cutting-edge equipment, etc. have been approved (fixed zero) will be extended to March 31, 2023.

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