The House of Councilors on Wednesday passed a new antigraft law that expands the scope of illegal deeds by politicians and their state-paid secretaries but nevertheless leaves several loopholes.

The coalition parties had submitted the bill to soothe a public uproar that followed the arrest in June of former Construction Minister Eiichi Nakao for allegedly taking bribes from a construction company.

But it provides no penalties for bribes given to a third party, such as a private secretary, instead of to the politician.

It also stipulates that application of the law "should not unjustly hinder political activities" and that provision of political donations is not punishable if conducted with "conventional wisdom."

In addition, ruling party members said during Diet deliberations that allocating budget resources to individual projects would not constitute a crime.

An opposition antigraft bill with stricter parameters was voted down in both the Lower House and Upper House.

The new law -- sponsored by the Liberal Democratic Party, New Komeito and the New Conservative Party -- basically aims to ban politicians and their state-paid secretaries from accepting money or goods in exchange for favors. It covers Diet members, their publicly funded secretaries, local assembly members, governors and mayors.

Under it, politicians face imprisonment of up to three years and their state-paid secretaries two years if they "exercise influence" on public servants "based on the authority vested in them" in return for benefits in the form of assets. Others who provide favors could also be imprisoned for up to one year and fined up to 2.5 million yen.

The exercise of influence covers central and local government contracts and administrative penalties.

In its own bill, the opposition camp included private secretaries as influence-peddling agents and deleted the phrase "exercise influence based on the authority vested in them" to crack down on politicians and secretaries who pressure public servants into satisfying the needs of those who filed requests.

The opposition's bill also said punishable deeds should not be limited to central and local government contracts and administrative penalties.

Extra budget enacted

The Diet on Wednesday enacted a 4.78 trillion yen supplementary budget for fiscal 2000 aimed at achieving a self-sustaining economic recovery, with its passage through the House of Councilors.

The Upper House endorsed the extra budget by a majority vote by the ruling coalition -- the Liberal Democratic Party, New Komeito and the New Conservative Party.

The supplementary budget sailed through the House of Representatives on Tuesday on a majority vote by the ruling camp.