The transport ministry plans to conduct hearings with major shareholders and holding companies of railways whenever deemed necessary to strengthen its monitoring of train safety, ministry officials said Thursday.
The move by the Ministry of Land, Infrastructure and Transport comes after Hanshin Electric Railway Co. became the target of an unsolicited takeover attempt by the Murakami fund earlier this year, stirring concerns over stable management of railways, the officials said.
The ministry will conduct hearings whenever major shareholders express intent to join in the management of railways to ensure, for example, that safe operations are the priority, they said.
It is extremely rare for the central government to conduct hearings with shareholders, as they could have an impact on financial markets, but a revision in railway operation legislation stipulates strengthened safety monitoring by the central government.
The revised legislation takes effect Oct. 1, following a series of accidents, including the fatal derailment of a commuter train in Amagasaki, Hyogo Prefecture, in April last year.
The hearings, which will focus on management stability, are necessary also from the viewpoint of implementing the revised legislation, ministry officials said.
The ministry will release guidelines for conducting the hearings probably this fall, they said.
The attempted takeover of Hanshin by the Murakami fund was settled after the investment fund sold its Hanshin shareholdings to Hankyu Holdings Inc., but the Murakami fund had at one point expressed intent to take part in Hanshin's management.
Transport minister Kazuo Kitagawa said at the time of the takeover attempt that he wanted to remain a silent observer, but at the same time he expressed concern about not taking any action.
Kitagawa instructed a ministry team to consider what action the ministry could take under similar situations, according to the officials.