Steven M. Dickinson ^*
& Takeo Kosugi ^{* *}

Appendix B

CONCERNING ITEMS OF CONCERN IN RELATION TO THE BUSINESS OF DEALING IN NEGOTIABLE CERTIFICATES OF DEPOSIT AND COMMERCIAL PAPER ISSUED ABROAD (Gaikoku de Hakkosareta Jotosei Yokin Shosho Oyobi Komasharu Pepa no Toriatsukai Gyomu ni Kakaru Ryui Jiko ni Tsuite), Ministry of Finance, Banking Bureau, Administrative Communication of Banking Section Chief and Medium and Small Financial Institution Section Chief (March 30, 1984)

On the basis of the Circular "Concerning the Business of Dealing in Negotiable Certificates of Deposit and Commercial Paper Issued Abroad" (Banking Bureau Circular No. 833 dated March 30, 1984) (hereinafter the "Circular"), dealing in negotiable certificates of deposit (hereinafter "foreign CDs") and commercial paper (hereinafter "foreign CP") issued abroad has been approved. Accordingly, essential particulars with respect to the concrete application of the Circular have been established as follows. Please take this matter under advisement and communicate the contents of this message to the financial institutions under your jurisdiction as thoroughly as possible.

Message

1. Transaction Subject Hereto

(1) In 1(1) of the Circular, "financial institutions with gross assets of a specified amount and above" shall be financial institutions within the top 150 in the world, and "businesses with the highest rating" shall be limited to businesses which have received a rating of Al+, Al or PI from rating companies on the specific instrument in question.

(2) In 1(2) of the Circular, the scopes of "Japan-related banks" and of "Japan-related juridical persons" shall be determined by applying mutatis mutandis the definitions of "subsidiary" and of "related company" provided in article 8, paragraph 3 and article 8, paragraph 4, respectively, of the Rules Concerning Wording, Forms and Working Methods for Financial Forms, etc. (Ministry of Finance Ordinance No. 59 of 1963).

(3) In 1(3) of the Circular, "repayment period" shall be the repayment period stated on the face of the foreign CD or foreign CP instrument.

2. Protection of Investors

(1) Concerning the procedure with respect to "necessary measures such as the distribution of the description of the issuer" in 4 of the Circular, a report containing the following information concerning the foreign CD or foreign CP issuer shall be provided to the investor:

[1] company name (bank name), [2] address, [3] nature of business, [4] status with respect to income/expenditure and assets/liabilities, [5] rating for foreign CP or corporate debentures, [6] matters relating to guarantee, etc., and [7] other matters of reference for investors.

(2) Foreign CDs and foreign CP to be dealt in shall be issued in sufficiently dependable markets such as the United States and Euromarkets. Customers for sales shall be limited to institutional investors, etc., which are thoroughly familiar with trends in the domestic and foreign financial markets.

3. Reports

Concerning activities in this business, when submitting the reports under the Foreign Exchange and Foreign Trade Control Law (Law No. 228 of 1949) to the International Finance Bureau, copies thereof shall be submitted to this bureau.

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