• Kyodo News


The government introduced its latest corporate turnaround program Thursday, unveiling conditions companies must meet to apply for the capital-boosting scheme backed by taxpayer money.

The supplementary rules include the requirement that an applicant must have 5,000 or more employees in Japan or supply 30 percent of crucial parts to another company of the same size, the Ministry of Economy, Trade and Industry said.

Applicants for the de facto public fund injection program have to meet four conditions. One limits applicants to companies suffering a plunge in quarterly sales of 20 percent or more, or a dive in half-year sales of 15 percent or more, due to the global recession.

The measures are part of the revised Law on Special Measures for Industrial Revitalization, which the Diet recently approved.

Firms meeting those conditions will be required to submit a restructuring plan that will improve earnings within three years.

After passing all the screenings, companies will receive investment from the government-backed Development Bank of Japan. If a recipient company goes bankrupt, the government will cover up to 80 percent of the loss incurred by the DBJ with taxpayer money.

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