The Japanese Ministry of Finance (MOF) today announced that foreign investors must now “file a prior notification for screening” when making an inward direct investment on companies that build semiconductor manufacturing tools and advanced electronic components. This move is an expansion of Japan’s Foreign Exchange and Foreign Trade Act (FEFTA), which regulates foreign direct investment in Japanese companies.
The expansion of “specified critical products” under the Economic Security Promotion Act is driven by the need to ensure a stable supply chain for Core Business Sectors and prevent other countries from using economic pressures to influence decisions by the Japanese government in international relations. According to the MOF (PDF), these are the sectors that require approval:
