International Monetary Fund. Monetary and Capital Markets Department
Published Date:
September 2004
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(Position as of December 31, 2003)
Status Under IMF Articles of Agreement
Article VIIIDate of acceptance: April 1, 1964.
Exchange Arrangement
CurrencyThe currency of Japan is the Japanese yen.
Exchange rate structureUnitary.
Independently floatingThe exchange rate of the Japanese yen is determined on the basis of supply and demand in the foreign exchange market. However, the authorities intervene when necessary in order to counter disorderly conditions in the market. The principal intervention currency is the dollar.
Exchange taxNo.
Exchange subsidyNo.
Forward exchange marketThere are no officially set rates in the forward market, and forward exchange transactions are based on free market rates.
Arrangements for Payments and Receipts
Prescription of currency requirementsNo.
Payments arrangementsNo.
Administration of controlThe exchange and trade control system is operated mainly by the Ministry of Finance (MOF), the Ministry of Economy, Trade, and Industry (METI), and the Bank of Japan (BOJ), which acts as the government’s agent. Import- and export-reporting requirements are handled by the METI.
International security restrictions
In accordance with IMF Executive Board Decision No. 144-(52/51)Measures have been taken to freeze funds and other assets of the Taliban, individuals and entities associated with the Taliban, and terrorist organizations, in accordance with the relevant UN Security Council resolutions.
In accordance with UN sanctionsPermission from the MOF and the METI is required for payments to the Taliban and individuals, groups, and organizations associated with terrorism. In accordance with UN Security Council resolutions, economic sanctions against Iraq were lifted on May 22, 2003.
Payments arrearsNo.
Controls on trade in gold (coins and/or bullion)Exports and imports of gold exceeding 1 kg in total weight must be declared to the MOF through the customs authorities.
Controls on external tradeYes.
Controls on exports and imports of banknotesExports and imports of banknotes (including checks, traveler’s checks, promissory notes, and securities) in both domestic and foreign currency exceeding ¥1 million in value must be declared to the MOF through the customs authorities.
On exports
Domestic currencyYes.
Foreign currencyYes.
On imports
Domestic currencyYes.
Foreign currencyYes.
Resident Accounts
Foreign exchange accounts permittedYes.
Held domesticallyYes.
Held abroadYes.
Accounts in domestic currency held abroadYes.
Accounts in domestic currency convertible into foreign currencyYes.
Nonresident Accounts
Foreign exchange accounts permittedYes.
Domestic currency accountsYes.
Convertible into foreign currencyYes.
Blocked accountsNo.
Imports and Import Payments
Foreign exchange budgetNo.
Financing requirements for importsNo.
Documentation requirements for release of foreign exchange for importsNo.
Import licenses and other nontariff measuresCertain goods are subject to import restrictions under the Import Control Order for purposes of national security, public health, and environmental and moral protection. Imports of these goods require prior approval from the METI. For the restricted items, authorization from the METI and an import quota certificate are required. For the importation of certain other goods from specific countries or shipping areas, individual authorization must be obtained from the METI. Import settlements effected under special methods require authorization from the METI.
Negative listYes.
Open general licensesYes.
Licenses with quotasYes.
Import taxes and/or tariffsJanuary 1, 2003, the tariff on imports of chilled beef was temporarily increased to 50% from 38.5%.
State import monopolyNo.
Exports and Export Proceeds
Repatriation requirementsNo.
Financing requirementsNo.
Documentation requirementsNo.
Export licensesExport restraint may be applied either globally or to certain destinations, and it may cover export volume, export prices, or other conditions. Exports of specified raw materials for foreign processing and reimportation require individual licenses. Certain goods are subject to export restrictions under the Export Control Order for purposes of international security and environmental protection.
Without quotasYes.
With quotasYes.
Export taxesNo.
Payments for Invisible Transactions and Current Transfers
Controls on these transfersNo.
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsNo.
Restrictions on use of fundsNo.
Capital Transactions
Controls on capital transactionsYes.
Controls on capital and money market instrumentsNo.
Controls on derivatives and other instrumentsNo.
Controls on credit operationsNo.
Controls on direct investment
Outward direct investmentOutward direct investments by residents in a limited number of industries, such as the manufacture of arms, require prior notice.
Inward direct investmentInward direct investments by foreign investors in a limited number of industries, such as the manufacture of arms, require prior notice.
Controls on liquidation of direct investmentNo.
Controls on real estate transactionsNo.
Controls on personal capital transactionsNo.
Provisions specific to commercial banks and other credit institutionsNo.
Provisions specific to institutional investors
Limits (max.) on investment portfolio held abroadThe limits are (1) 30% of total assets for insurance companies purchasing foreign currency denominated assets; (2) 20% of the reserve funds issued by nonresidents for holding by the Post Office Insurance Fund of bonds; and (3) 30% of pension trust assets for foreign currency–denominated assets purchased by pension funds deposited before April 1, 1990, and 50% thereafter, on the basis of each institutional account, with the ceiling for foreign affiliated companies being 70%.
Other controls imposed by securities lawsYes.
Changes During 2003
Arrangements for payments and receiptsMay 22. The economic sanctions against Iraq were lifted.
Imports and import paymentsJanuary 1. The tariff on imports of chilled beef was temporarily increased to 50% from 38.5%.

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