Law joins deregulation program

Limits on stock ownership, legal profession considered

The government revised its three-year deregulation program Friday by adding measures for reviews of the legal profession and limits on stock ownership by banks and insurers, officials said.

This latest revision of the program, which encompasses fiscal 1998 through 2000, is the second following one last March. The total plan covers 1,268 items in five areas, including the 351 items added this time.

The revision was made by the Administrative Reform Headquarters, headed by Prime Minister Keizo Obuchi. One of its focal points concerns legal services currently monopolized by lawyers.

The revised program requires the government to decide by fiscal 2001 whether to allow some of those services to be provided by judicial clerks, patent lawyers and licensed tax accountants.

It proposes lifting restrictions on advertising by government-licensed service providers, such as judicial clerks and certified public accountants.

On stock ownership by commercial banks and insurance companies, the program calls for a review of the restrictions currently imposed by the Antimonopoly Act.

The cap on stock ownership was introduced to prevent banks and insurers from exerting too much influence on corporations.

However, in line with ongoing financial liberalization, banks and insurers have been actively merging and forming new alliances. In some cases, merged institutions have been forced to sell off shares they hold in companies in order to comply with that limit, putting downward pressure on share prices.

Licensing requirements for liquor retailers will meanwhile be abolished. This issue was met by strong opposition from some members of the Liberal Democratic Party who wanted such regulations intact to protect the interests of existing liquor retailers.

The program calls for a distance-based restriction on the opening of new liquor shops to be eliminated Sept. 1, and a population-based restriction to be lifted on Sept. 1, 2003.

The program also proposes for the first time a review of the regulations that oblige manufacturing plants, restaurants and other offices to hire licensed experts in such areas as hygiene. Currently, 14 ministries and agencies issue licenses in 98 different zones.

It calls for the abolition of licensing restrictions in areas where such qualifications are no longer necessary, or a relaxation of the regulations so that such accreditation will be more readily attainable.

Other proposals include raising the speed limit for minivehicles and large motorcycles on expressways to 100 kph from the current 80 kph limit by fiscal 2000.

It also lists the abolition of the government’s reinsurance system for automobile liability insurance, assuming that accident victims will also be provided increased protection.

The abolition of this system is expected to reduce insurance companies’ administrative costs for auto insurance policies. Around 60 percent of the premiums paid for auto liability insurance policies go to the state reinsurance program.