The government endorsed a bill Friday to revise the Securities and Exchange Law so new rules can be applied to public tender offers involving stock acquisitions of one-third or greater in a company through off-hours trading.
The government, which endorsed the bill at a Cabinet meeting, submitted it to the Diet later in the day, with an eye to putting into force by July, government officials said.
Regulations for public tender offers require a company wishing to acquire a major stake in another firm to make public the amount of shares it aims to buy, the purchase price and other details of its bid in advance. Violators may be fined.
However, since the current Securities and Exchange Law does not cover off-hours trading, no prior announcement is required.
The revision is being made to fend off surprise acquisitions of major stakes in listed companies through off-hours trading -- the tactic used by Internet service firm Livedoor Co. last month to boost its minority stake in Nippon Broadcasting System Inc. to some 35 percent virtually overnight.