Japan’s government outlined plans to restrict foreign ownership of domestic companies operating in the country’s telecoms and IT sectors, in light of heightened global cyber security concerns.
In a statement seen by Reuters, Japan’s ministries of finance, trade and communications said the new rules, effective from 1 August 2019, will be applied to 20 sectors in the country’s information and communications industries.
There was no specific mention of which countries or companies will be impacted.
“Based on increasing importance of ensuring cyber security in recent years, we decided to take necessary steps, including addition of integrated circuit manufacturing, from the standpoint of preventing as appropriate a situation that will severely affect Japan’s national security,” the statement read.
The ministries added it wants to safeguard technology equipment developed in the country that it deems important for national security.
The move comes as Japan’s Prime Minister Shinzo Abe held talks in Tokyo with US President Donald Trump. The US has pressured its allies not to use equipment made by Chinese companies in its telecoms networks, which it suspects is used to spy for the Chinese government. China and Huawei have denied the allegations.
Japan has however already taken strong action against Chinese vendors Huawei and ZTE, passing new procurement regulations barring the companies from bidding for government contracts. The country’s operators have also said they have no plans to deploy gear from the companies in their 5G networks.
Reuters reported that Japan already imposes foreign ownership restrictions in certain industries, including nuclear-related and aviation sectors. Under the country’s foreign exchange and foreign trade control law, overseas investors are required to report and undergo inspection if they buy 10 per cent or more of stock in listed Japanese companies.