The government will expand its national security restriction on foreign investors acquiring shares in Japanese firms by adding information technology-related firms in August.
The move is aimed at preventing the outflow of sensitive information and technologies to other countries, including China.
The announcement Monday followed a U.S. decision earlier this month to effectively ban American companies from supplying parts to Chinese tech giant Huawei Technologies Co., citing national security concerns, and put it on a list of companies that U.S. firms cannot trade with without a license.
The Japanese government will add 15 industry sectors, including mobile phone and computer manufacturers, to its restriction list and expand the scope of companies included in five already-covered industries, such as regional and long-distance telecommunications businesses.
The arms, airline and nuclear industry sectors have been subject to the restriction in accordance with the Foreign Exchange and Foreign Trade Control Law.
Foreign investors will be obliged to notify the government in advance when they seek to obtain more than a 10 percent stake in listed firms or buy shares in unlisted companies in Japan.
The government will then screen their notifications to examine whether the stock acquisition would damage the country's safety.