I hereby give My Sanction to the Law concerning the Emergency Measures for the Account of Companies approved by the Imperial Diet and cause the same to be promulgated.
Signed:HIROHITO, Seal of the Emperor
This fifteenth day of the eighth month of the twenty-first year of Showa (August 15, 1946).
Countersigned: Prime Minister YOSHIDA Shigeru
Minister of Justice KIMURA Tokutaro
Minister of Agriculture and Forestry WADA Hiroo
Minister of Commerce and Industry HOSHIJIMA Niro
Minister of Welfare KAWAI Yoshinari
Minister of Transportation HIRATSUKA Tsunejiro
Minister of Finance ISHIBASHI Tanzan
Bill concerning the Emergency Measure for the Account of Companies
Art.1. Special accounting companies referred to in this Law shall mean the following companies (financial institutions coming under Article 27, Item 1 and Item 2 of the Law concerning the Emergency Measures for the Accounts of Financial Institutions and designated institutions prescribed in Article 1 of Ministries of Finance, Foreign Affairs, Home Affairs, and Justice Ordinance No.1,.1945 are hereinafter excluded).
1. Companies whose capital stock (hereinafter referring to subscriptions, stocks or the total of subscriptions and stocks) is two hundred thousand (200,000) yen or more and which have received any payments of war indemnity and others or which have claims for such payments or Overseas Assets at 12 twelve o'clock midnight of August 11, 1946 (hereafter called "designated hour" ), provided that companies whose aggregate amount of war indemnity and others or such claims on the assets column of the balance sheet of the company and of Overseas Assets does not exceed the reserve funds calculated at the designated hour in the manner stipulated by Ordinance or the aggregate amount of the reserve funds and the excess, if any, of the value of movable property, immovable property, claims and other property entered on the inventory at the designated hour (with regard to fixed assets for business of joint-stock companies, incorporated joint-stock limited partnerships, limited companies and securities with a price of the exchange, the value shall not exceed that determined in Article 285 of the Commercial Code or Article 458, Paragraph 2 of the Commercial Code or Article 46, Paragraph 1 of the Limited Companies Law applying Article 285 of the Commercial Code mutatis mutandis,) and which have no fear of excess of liabilities over assets or insolvency and which have been approved by the competent Minister are hereinafter excluded.
2. Companies coming under any of the following items which have been designated by the competent Minister;
(1) Companies which have received War Indemnity or War Insurance payments or have Overseas Assets;and which are capitalized at less than two hundred thousand (200,000) yen at the designated hour.
(2) Companies which have a fear of an excess of liabilities over assets or insolvency due to the fall in price of the assets of the company after the enforcement of this Law owing to the greatly increased difficulty of collecting claims or other causes;
(3) Companies which have a fear of an excess of liabilities over assets or insolvency due to the fall in price of securities or debentures or to the difficulty of disposing of them after the enforcement of this Law.
Companies which desire to obtain the approval of the competent Minister pursuant to the provisions of proviso of the preceding Paragraph shall file an application for approval to the competent Minister within two (2) months after the enforcement of this Law.
Companies which desire to obtain the designation referred to in Paragraph 1, Item 2, shall file an application to the competent Minister within two (2) months after the enforcement of this Law.
The competent Minister may make the approval and designation upon an application filed after the lapse of the term mentioned in the preceding Paragraph, if he deems it necessary under special circumstances.
The competent Minister shall make a Notification in the Official Gazette as soon as he has made a designation or given his approval under Paragraph 1, Item 1, proviso or given his approval under Item 2 of the same Paragraph.
Companies of which capital is two hundred thousand (200,000) yen or more, and which have not received War Insurance payments and others or have no claims for such payments, or no Overseas Assets, shall report to the competent Minister the fact that they do not fall within special accounting companies within three (3) weeks after the enforcement of this Law and simultaneously make a notification in the Official Gazette.
Art.2. In case a company coming under the proviso of Paragraph 1, Item 1 of the preceding Article does not file an application prescribed in Paragraph 2 of said Article, those who have claims at the designated hour equivalent to one tenth or more of the paid-up stock or the paid-up shares, partners whose shares exceed one tenth of the capital stock, at the designated hour, or stockholders who have stock at the designated hour equivalent to one tenth of the capital stock may demand the company to file an application referred to in said Paragraph within twenty (20) days after the lapse of the term mentioned in said Paragraph.
The provisions of the preceding Paragraph shall apply mutatis mutandis to the case where companies coming under any of the sub items (1) to (3) inclusive of Item 2 of Paragraph 1 of the preceding Article file an application for designation pursuant to the provisions of Paragraph 3 of the said article.
Companies when they receive demands stipulated in the preceding two Paragraphs, shall file an application for the approval or designation in accordance with Paragraph 2 or 3 of the preceding Article.
Art.3. In case companies have obtained the designation referred to in the proviso of Article 1, Paragraph 1, Item 1 or the approval referred to in Paragraph 1, Item 2 of said Article, they shall register the fact within two (2) weeks in the case of the main office and within three (3) weeks in the case of the branch office.
Companies coming under Article 1, Paragraph 6 shall register the fact that they do not fall within specially accounting companies within two (2) weeks in the case of the main office and within three (3) weeks in the case of the branch office.
Art.4. Regarding claims over the companies designated pursuant to Article 1, Paragraph 1, Item 2, arising from causes prior to the designated hour, the repayment or other acts to cancel such claims performed after the designated hour and before the designation mentioned in Article 1, Paragraph 1, Item 2 shall be void,provided that this shall not apply to claims other than monetary claims of which fulfilment belongs to the general business of the company and claims provided in the various items of Article 14, Paragraph 1.
The provisions of the preceding Paragraph shall not prejudice the rights of third parties.
The transfer of immovable property or other important assets made by companies under Paragraph 1 before the designation stated in Article 1, Paragraph 1, Item 2 and after the designated shall be void.
In the above case, claims of the transfer shall be regarded as claims arising from causes prior to the designated hour.
Art.5. Special accounting companies shall prepare an inventory, a balance sheet, a statement on movable property, immovable property, claims and other property and liabilities outstanding at the designated hour, and a profit and loss account for the term from the beginning of the business year to the designated hour inclusive.
Art.6. Special accounting companies shall have Special Supervisors.
Art.7. Special accounting companies shall set up a new account and an old account at the designated hour.
Special accounting companies shall at the designated hour transfer to the new account, as prescribed by Ordinance, from among movable property, immovable property, claims and other property listed on the inventory prepared pursuant to the provisions of Article 5 (hereinafter called "company's assets" ), the assets necessary for carrying out the present business of the company which is the purpose of the company and for reconstructing and promoting post-war industy. The company's assets other than those transferred to the new account shall belong to the old account.
The scope of the company's assets transferred to the new account shall be determined by the special Supervisors, as prescribed by Ordinance.
The accounting of the company after the designated hour shall be made separately on the new account and the old account.
Companies who do not have any company's assets to be transferred to the new account pursuant to Paragraph 2, and companies under liquidation or under the procedure of bankruptcy shall set up only the old account notwithstanding the provisions of Paragraph 1.
The provisions of Paragraphs 1 to 4 inclusive shall apply to cases where companies stated in the preceding paragraph need to set up a new and old accounts and where the special supervisors have been selected.
If the necessity should arise to transfer to the new account, the assets among the company's assets belonging to the old account, they can be transferred to the new account upon the decision of special Supervisors.In this case, the company's assets concerned shall be regarded as belonging to the new account as from the date of the actual transfer.
Special accounting companies shall keep separate books for the new account and the old account to discriminate the company's assets belonging to the new account or to the old account, pursuant to the preceding various items.
Art.8. Special accounting companies shall make a statement on the company's assets of the new account and the old account pursuant to the provisions of Paragraph 3 of the preceding Article and have them approved by the Special Supervisors as prescribed by Ordinance.
The statements of the company's assets approved by the Special Supervisors pursuant to the provisions of the preceding Paragraph shall be certified by a Public Notary within two (2) weeks after approval by the Special Supervisors.
The competent Minister may extend the term mentioned in the preceding paragraph upon the petition of the Special Supervisors in unavoidable circumstances.
The decision mentioned in Paragraph 3 of the preceding article shall not be effective, unless certified pursuant to Paragraph 1.
In case alteration is made to the company's assets belonging to the new account or the old account, the provisions of the preceding four paragraphs shall apply mutatis mutandis to the company's assets transferred from the old account to the new account.
Regarding the company's assets which is belonging to the old account, and which is registered unless special accounting companies register the fact that they belong to the old account, a third party may disregard such fact.
The company's assets which do not come under the application of the provisions of the preceding Paragraph and of which it is not clear whether they belong to a new account or an old account shall be presumed belonging to the old account.
The provisions of the preceding seven paragraphs shall not apply to companies which do not set up a new account.
Art.9. In case the-company's assets have been separated into the new account and the old account pursuant to the provisions of Article 7, Paragraph 1, companies shall set up on the assets column of the balance sheet of the old account, an account for unsettled receipts from the new account, on which is entered the amount of the value of company's assets listed on the inventory prescribed in Article 5, and simultaneously_set up on the liabilities column of the balance sheet of the new account an account for the unsettled payments to the old account, on which is entered the same amount.
The provisions of the preceding paragraph shall apply mutatis mutandis to the case of Article 7, Paragraph 7.
Art.10. Special accounting companies shall carry over from the new account to the old account on the beginning of the next month the amount equivalent to those obtained by multiplying the amount outstanding on the end of every month on Unsettled Payment Account on the liabilities column of the balance sheet of the new account, by the rate determined by Ordinance.
In case the amount in the Unsettled Payment Account on the liabilities column of the balance sheet of the new account is subject to increase or decrease during the middle of the month, the amount obtained by adding to or deducting from, the amount calculated by applying the provisions of the preceding paragraph to the amount of Unsettled Payments Account at the end of preceding month, the amount of increase or decrease calculated in the manner prescribed in the preceding paragraph, shall be the amount to be carried over to the new account.
Art.11. Special accounting companies shall account the receipts and payments resulting from causes after the designated hour as the receipts and outlays on the new account.
Special accounting companies shall account the receipts and payments resulting from causes prior to the designated hour as the receipts and outlays on the old account.
With regard to retirement allowances to those who have retired after the designated hour or receipts or payments arising from matters extending from before to after the designated hour, special regulations may be provided by Ordinance, notwithstanding the provisions of the preceding two articles.
The payments needed for the management of the company's assets belonging to the old account shall be accounted as the payments on the old account in spite of the provisions of Paragraph 1.
The assets which special accounting companies received after the designated hour as legal earnings of the assets belonging to the old account or received as a result of the disposal of the assets belonging to the old account shall belong to the old account.
Art.12. Preferential right, right of pledge, or right of mortgage of the claims arising from causes prior to the designated hour (hereinafter called"old claim over the company's assets of special accounting companies belonging to the new account shall be void, except as prescribed otherwise by Ordinance, on and after the day of the actual transfer of the company's assets concerned to the new account.
In case the company's assets transferred to the new account belong to Railway Foundations, Factory Foundations, Mining Foundations, Track Foundations, Canal Foundations, Fishery Foundations, or Automobile Transportation Foundations, they shall be separated from the foundations concerned except as prescribed otherwise by Ordinance on the day of the actual Transfer of the company's assets to the new account, and regarded thereafter as no more belonging to the foundation concerned.
Preferential right, right of pledge or right of mortgage of the claims over the company's assets referred to in Paragraph 1 on and after the day of the merger of the new account with the old account shall not be void, and the assets referred to in Paragraph 2 shall be regarded as not having been separated from the Foundation concerned,provided that this shall not apply to the case where a security right to prevent the exercise of such claims over the company's assets concerned has arisen after such claims have been void in accordance with the provisions of Paragraph 1 or the case where the company's assets concerned have belonged to those other than the company concerned.
In the case of the proviso of the preceding Paragraph, the company concerned shall have the, amount to be repaid from the company concerned to those having claims referred to in said paragraph deposited.
Those who have claims referred to in the preceding Paragraph shall exercise the right over the deposited money mentioned in the preceding paragraph as of those having preferential right, right of pledge or right of mortgage.
Art.13. Claims over special accounting companies arising from causes after the designated hour (claims arising from the management of the assets belonging to the old account excluded. Hereinafter called "new claims" ) may not exercise compulsory execution, provisional attachment or disposal over the assets belonging to the old account.
Art.14. Regarding old claims of special accounting companies, no one shall repay or be repaid or take actions to cancel them (except when having the creditors release them from obligations),provided that this shall not apply to claims other than monetary claims of which purpose is to deliver articles and for which fulfilment can be made on the new account as the general business of the special accounting company, claims for commitment or non-commitment of action or to the following items.
1. Claims for taxes and other public charges of the State or Local Governments, or other similar claims to the above;
2. Claims for periodic salaries and other periodic allowances, prescribed by Ordinance;
3. Claims for money deposited with the company by employees, provided that the amount shall not exceed the limit prescribed by Ordinance;
4. Claims for retirement allowances determined prior to the designated hour, or other temporary allowances prescribed by Ordinance, provided that the amount shall not exceed the limit prescribed by Ordinance;
5. Claims for small amounts under 1,000 yen arising from the actual operation of the business of the company;
6. Other prescribed by Ordinance.
In case special accounting companies are not able to pay on the old account for the obligations mentioned in the various items of the preceding paragraph, they may pay on the new account within a limit of the amount appropriated with Unsettled Payments Account on the liabilities column of the balance sheet of the new account, created pursuant to the provisions of Article 9, with the approval of the Special Supervisors.
The same shall apply to the claims arising from the management of the assets belonging to the old account,provided that the approval of the competent Minister shall be required in this case, as prescribed by Ordinance.
Regarding the claims stated in Items (2) to (6) inclusive of Paragraph 1 and the claims stated in the latter part of the preceding paragraph, compulsory execution, provisional attachment or disposal may not be exercised on the assets belonging to the new account.
In the case of Paragraph 2, the same amount to that paid on the new account shall be deducted respectively from Unsettled Receipts Account on the assets column of the balance sheet of the old account and the Unsettled Payments Account on the Liabiliities column of the balance sheet of the new account.
Art.15. No one can plead bankruptcy in regard to special accounting companies.
Consent of partners or resolution of the general meeting of shareholders or partners concerning the dissolution, amalgamation, change of organization or increase or decrease of capital stock (subscriptions included) shall not take effect,provided that this shall not apply to the case when the approval of the competent Minister is obtained for special causes.
Reorganization, or procedure of composition under way with regard to special supervised companies shall be suspended.Stops of compulsory execution, provisional attachment, disposal, or auction under Auction Law taken against the assets of special accounting companies shall be suspended as far as the company is a special accounting company, provided such procedure shall be void when the assets are trans ferred to the new account.
Art.16. Special accounting companies shall prepare an inventory, a balance sheet and a statement on profit and loss for the new account and the old account separately in every business term.
The provisions regarding inventory, balance sheet or profit and loss statement in the Commercial Code shall apply mutatis mutandis to the documents prescribed in the preceding paragraph.
Profit and loss on the new account in every business term shall be carried over to the next term.
Notwithstanding the provisions of other Laws. Ordinances, or Articles of Incorporation the business year including the designated hour of special accounting companies shall end at the designated hour and the period thereafter shall belong to the next business year.
Profits arising on the business year ending at the designated hour, if any, shall be set aside as reserve notwithstanding the provisions of other Laws, Ordinances or Articles of Incorporation.
Art.17. Special accounting companies shall elect Special Supervisor, two from among the directors or other officers executing the buisness of the special accounting companies and two from among the creditors having old claims on such companies.
The time and method of eleciton mentioned in the preceding paragraph and other necessary matters shall be prescribed by Ordinance.
In case the Special Supervisors mentioned in Paragraph 1 are elected, special accounting companies shall register their address, name or title and the relation of the Supervisors with the company within two (2) weeks in the case of the main office and within three (3) weeks in the case of the branch office.
The provisions of Article 67 of the Commercial Code shall apply mutatis mutandis to the registration mentioned in the preceding paragraph.
Special accounting companies shall report to the competent Minister within two (2) weeks after the election of the Special Supervisors on the matters requiring registration as provided in the preceding two paragraphs.
Art.18. The Special Supervisors shall be under the supervision of the competent Minister.
Remunerations to the Special Supervisors and expenses needed for their business shall be determined by Ordinance.
Art.19. In case the Special Supervisors desires to decide on the scope of the company's assets referred to in Article 7, Paragraph 3, or on the policy of management to in Article 2, Paragraph 1, approve the disposal referred to in Article 21 or the payment referred to in Article 14, Paragraph 2 of the disposal referred to in Article 22 or make a consent referred to in Article 23, Paragraph 2, it shall be decided by the majority of the Special Supervisors,provided that in case where the number of votes are equal, the Special Supervisors shall make a petition to the competent Minister fot his final decision.
Art.20. The competent Minister may remove a Special Supervisor in case he violates the provisions of Laws or Ordinances or commits actions harmful to the public benefit or is deemed to be unfit by the competent Minister.
Art.21. Executive officers of special accounting companies shall obey the decision by the Special Supervisors relating to the management policy concerning the management of the property belonging to the old account.
The Special Supervisors shall supervise the executive officers of the companies regarding the management of the property belonging to the old account.
Art.22. In case, special accounting companies desire to transfer, lease pledge or mortgage the company's assets or assets belonging to the old account acquired after the designated hour, they shall obtain the approval of the Special Supervisors (the competent Minister, in case Special Supervisors have not been elected) unless otherwise stipulated by Ordinance.
The provisions of the preceding paragraph shall not prevent the application of the provisions of Article 14, Paragraph 1, proviso.
Unless the approval of the Special Supervisors is obtained in cases requiring the approval thereof, the disposal of the assets of the company pursuant to the provisions of Paragraph 1 shall be void,provided it shall not be void for a third person acting in good faith.
Art.23. Those who desire to transfer the stocks of special accounting companies shall obtain the prior approval of the competent Minister.
In the case of the preceding paragraph, companies who desire to grant approval shall obtain the consent of the Special Supervisors. This shall apply to the case where companies desire to grant approval or to resolve the approval regarding the transfer of holdings pursuant to Article 73 of the Commercial Code (the case applied mutatis mutandis under Article 147 of said Code included) or the provisions of Article 19, Paragraph 1 of the Limited Companies Act.)
The transfer of the stock without the approval of the company prescribed in Paragraph 1 shall not be effective.
Art.24. Claims belonging to the old account of after the date to be authorized to exercise the right, special accounting companies shall not be barred by limitations until one month after the date from which they can be exercised again except for the claims stipulated in various items of Article 14, Paragraph 1 and the latter part of Paragraph 2.
Art.25. The competent Minister, if he deems it necessary, may give orders necessary for supervision to special accounting companies.
The competent Minister, if he deems it necessary, may order the companies to report the conditions of business and property or to let the books, documents or other articles be audited by the competent officials.
The competent Minister shall make the competent officials have with them an identification in case they inspect make an inspection pursuant to the preceding paragraph.
Art.26. The competent Minister may delegate to the heads of Local Government offices, part of his authority prescribed in this Law.
Art.27. The competent Minister may, as prescribed by Ordinance, have the Bank of Japan perform part of the administrative work relating to the enforcement of this Law.
Art.28. Representatives, agents, employees or other workers of companies who actually did the act shall be subject to penal servitude of 3 years or less or to a fine of 30,000 yen or less, in the following cases:
1. In case, they made a false statement in the application prescribed in Article 1, Paragraph 2 or 3;
2. In case of failure to file an application for the approval or designation prescribed in Article 2, Paragraph 3;
3. In case they fail to keep books or make a false entries in books in violation of the provisions of Article 7, Paragraph 8;
4. In case they fail to have the statement certified by a Public Notary or have a false statement certified by him, in violation of the provisions of Article 8, Paragraphs 2 or 5.
5. In case they repaid or took other action to cancel the claims in violation of the provisions of Article 14, Paragraph 1;
6. In case they repaid without the approval of the Special Supervisors or the competent Minister as prescribed in Article 14, Paragraph 3;
7. In case they do not obey the decision of the Special Supervisors regarding the disposal or management of the assets provided in Article 21.
8. In case they disposed of their assets without the approval of the Special Supervisors (or the competent Minister, in case Special Supervisor have not been elected) as prescribed in Article 22, Paragraph 1.
Art.29. Any person who has been repaid in violation of Article 14, Paragraph 1 shall be subject to penal servitude of 3 years or less or a fine of 30,000 yen or less.
Art.30. A Special Supervisor who receives, promises or requests a bribe in pursuance of his business, shall be subject to penal servitude of 3 years or less or a fine of 3,000 yen or less.
The same shall apply to any person who gives, offers or promises the bribe stated in the preceding paragraph.
Art.31. Special Supervisors, representatives, agents, employees and other workers of special accounting companies who actually did the act shall be subject to penal servitude of one year or less or to a fine of 10,000 yen or less, in the following cases:
1. In case they fail to prepare documents as prescribed in Article 5, Paragraph 1 or make a false statement.
2. In case of failure to file a report as prescribed in Article 17, Paragraph 5 or file a report which is false;
3. In case of failure to elect the Special Supervisors;
4. In case they approved, agreed to or resolved the approval of the transfer of the stocks of holdings without the consent of the Special Supervisors as prescribed in Article 23, Paragraph 2.
Art.32. Any person who fails to file a report as prescribed in Article 25, Paragraph 1 or files a report which is false shall be subject to penal servitude of oner year or less or a fine of 1,000 yen or less.The same shall apply to any person who refuses, interferes or evades the inspection in violation of said paragraph.
Art.33. The bribe received by the violator or those who are aware of the circumstance shall be confiscated.If whole or part of it cannot be confiscated the amount equivalent to it shall be collected.
Art.34. Any representative of a juridical person, any agent, employee or other worker of an individual or juridical person who commits an illegal action in violation of the provisions Article 28 or 29, the first part of Article 31 or Article 32 regarding the business or property of that juridical person or individual, the juridical person or individual himself shall be subject to a fine prescribed in the various Articles above in addition to the punishment imposed on the actual violators.
Art.35. Directors or persons similar to them of companies shall be subject to a penalty of 3,000 yen, in the following cases.
1. In case they fail to register in violation of Ordinance to be issued pursuant to this Law;
2. In case they fail to make a report in notificaton prescribed in Article 1, Paragraph 6 or make a false report or notification;
3. In case they violate the order issued by the competent Minister as prescribed in Article 25, Paragraph 1.
Art.36. The provisions of Articles 28 to 35 inclusive shall apply to the actions arising up to the designation or approval even after the designation or approval, in case the designation or approval is made pursuant to the provisions of Article 1, Paragraph 1, Item 1, Proviso.
Art.37. The scope of War Indemnity and others and Overseas assets in this Law shall be prescribed by Ordinance.
Art.38. In case a special accounting company fails to file to the competent Minister a reorganization plan in accordande with laws or ordinances within three (3) months after it has become a special accounting company or comes under other items provided by laws and ordinances, such company shall be exempted from the application of this law.
Necessary matters pertaining to the application of the preceding paragraph including the merger of new and old accounts shall be provided for by Ordinance.
Art.39. Necessary provisions of this Law shall apply mutatis mutandis to those other than special accounting companies as prescribed by Ordinance.
The provisions of Articles 28 to 36 inclusive shall apply to the case where they are applied mutatis mutandis in the preceding paragraph,provided that companies or special accounting companies referred to in those Articles shall mean those other than special accounting companies, and the provisions of those Articles shall include the provisions to be applied mutatis mutandis in accordance with the provisions of the preceding paragraph.
Act.40. Items on registration or other matters not provided in this Law shall be prescribed by Ordinance.
Supplementary Provision:
This Law shall come into force as from the day of its pormulgation.