A bill to freeze the government's planned sale of shares in Japan Post Holdings Co. and its banking and insurance units, and to halt the privatization process, cleared the Lower House on Tuesday. It is set to become law on Friday.
The bill proposed by the Democratic Party of Japan-led government was sent to the Upper House and is likely to win majority support Friday.
The Liberal Democratic Party abstained from voting to protest the ruling bloc's refusal to hold a debate between Prime Minister Yukio Hatoyama and LDP President Sadakazu Tanigaki.
The LDP also wants to hold intensive deliberations over alleged irregularities in Hatoyama's political funding reports.
The bill is part of the government's review of postal privatization, which was spearheaded by former Prime Minister Junichiro Koizumi. The bill would reorganize postal operations under new management.
The Hatoyama administration has claimed the postal business has been distorted by the Koizumi reforms and the current structure of the Japan Post group must be revised to better serve the public.
"If you manage politics the wrong way, that must be overturned," postal reform minister Shizuka Kamei, an arch foe of Koizumi's reforms, said in a press conference earlier in the day.
The LDP began the 10-year process of privatizing postal services in October 2007, creating four companies to provide mail delivery, over-the-counter services, banking and insurance under a holding company.
Japan Post, wholly owned by the government, largely replaced its management in late October under new President Jiro Saito.