The Japanese government affirmed on Monday that it will restrict foreign ownership of the Japanese telecoms and technology industries as part of an effort to obstruct China from accessing its trade confidential.
The country is poised to impose the restrictions from 1st Aug since Japan is being pressurized by the United States for a deal on cyber-security risks and technology handover, including China.
However, specific countries or companies that will be potentially banned after applying ownership restrictions are still not unveiled by the Japanese government. Japan made the crucial decision on the same day U.S. President Donald Trump and Japanese Prime Minister Shinzo Abe met to discuss trade and other issues in Tokyo.
The United States has been warning countries across the globe against association with Chinese technology, after discovering Huawei Technologies could pose a severe national security concern by using Beijing to spy on the West. However, Huawei and China have rigidly opposed the accusations.
Considering the escalating importance of protecting cyber-security in previous years has prompted the country to take rapid action, Japanese ministries said in a statement. The steps include the introduction of additional circuit manufacturing based on a view to avoiding a condition that could intensely affect national security in Japan.
Japan wants to avert a disclosure of technology that is highly significant for national security. The country also seeks to prevent injury to technology foundations and national defense.
The proposed restrictions will be applied to more than 20 divisions in the communications and technology industries, the Japanese trade and finance ministries said jointly in a statement.
According to the law, foreign investors will be required to inform the Japanese government and encounter an investigation if they want to acquire 10 percent or more shares of listed Japanese companies; the procedure will remain the same in case of unlisted Japanese companies.