SCAPIN-1741: DISSOLUTION OF TRADING COMPANIES
GENERAL HEADQUARTERS
SUPREME COMMANDER FOR THE ALLIED POWERS
APO 500
3 July 1947
AG 004
(3 Jul 47)
ESS/AC
(SCAPIN-1741)
| MEMORANDUM FOR | IMPERIAL JAPANESE GOVERNMENT. |
|---|---|
| THROUGH | Central Liaison Office, Tokyo. |
| Subject | Dissolution of Trading Companies |
1. Reference are:
a. Memorandum to the Japanese Government from General Headquarters, Supreme Commander for the Allied Powers, AG 004 (6 Nov 45) ESS/ADM, (SCAPIN 244), dated 6 November 1945, subject: Dissolution of Holding Companies.
b. Memorandum to the Japanese Government from General Headquarters, Supreme Commander for the Allied Powers, AG 091.3 (23 Jul 46) ESS/AC, (SCAPIN 1079), dated 23 July 1946, subject: Ordinances and Regulations Affecting the Holding Company Liquidation Commission.
c. Ordinance No. 233 of 1946.
d. Letter of Designation from the Prime Minister, dated 28 December 1946, Cabinet A 449.
2. In implementation of reference Memoranda and Ordinance, the following action will be taken:
a. Immediate commencement of dissolution and liquidation of the Mitsubishi Trading Company and the Mitsui Trading Company.
b. Prohibit the conduct of any business transactions or the transfer of any assets by said companies without the permission of the Holding Company Liquidation Commission, or such other agencies as may be designated, on and after the date of this memorandum.
c. Prohibit any persons who have been officers, directors, advisers, branch managers of foreign or domestic branches, or department or section heads of said companies, during a period of ten (10) years prior to the date of this memorandum, from associating together to form a new company, or more than two (2) being employed by or advising any one (1) existing company or company hereafter formed.
d. Prohibit any group of employees in addition to those specified in paragraph c, above, exceeding one hundred (100) in number, from organizing a new company, being employed by any one (1) existing company, or any company hereafter formed, without permission of the Holding Company Liquidation Commission or such other agencies as may be disignated. The Holding Company Liquidation Commission or such other agencies shall grant such permission if it shall conclusively appear that a possibility of recreation of the dissolved companies or other monopolistic combinations shall not result.
e. Prohibit any trading company in which any officers or employees of both said companies shall be employed from occupying any office now used or formerly used by either of said companies as a business office, and further prohibit any company from using the firm name Mitsubishi Trading Company or Mitsui Trading Company, or any resemblance thereof.
f. Require said, companies to immediately prepare, in detail, inventories of all assets, showing location, and submit same to the Holding Company Liquidation Commission.
g. Require the maintenance of all existing books and records of said companies.
3. In carrying out the provisions of the memorandum:
a. All assets of said companies shall be disposed of in accordance with existing legislation and ordinances, by open market sale, or in such other manner as may be fair and equitable.
b. The Holding Company Liquidation Commission may remove any officers of said companies or appoint officers to act as liquidators.
c. The Holding Company Liquidation Commission may require the companies to furnish reports and information or inspect any books or records.
4. The Japanese Government shall immediately furnish to the Supreme Commander for the Allied Powers a report of action taken in compliance with this memorandum.
FOR THE SUPREME COMMANDER:
R. M. LEVY,
Colonel, AGD,
Adjutant General.
MEMO FOR RECORD: (SCAPIN - 1741)
ECW/gg
14 June 1947
Subject: Dissolution of Large Trading Companies
1. In view of the fact that a few large trading companies, such as Mitsui, Mitsubishi, etc., had in the past dominated the market, particularly in foreign trade, it is the conclusion of the Antitrust and Cartels Division that such organizations should be dissolved. This action re trading companies, such as Mitsui and Mitsubishi, is consistent with and necessary attendant action to dissolution of Honshas. Likewise, this action should eliminate the likelihood that these trading companies would exploit their close contact with and their influence over government officials directly concerned with trading.
2. Consideration was given to reorganizing these trading companies into smaller units, but dissolution seemed to be more clear-cut and certainly easier to have accomplished quickly.
3. Speed is important in this regard since there should be a minimum of opportunity for confusion on the part of foreign traders, who are to come here in August, as to whether old contacts with these monopolistic companies can or cannot be renewed. Likewise, it is reasonable to have the trading companies themselves informed quickly so that they will not make plans for renewing their former operations, only to have such plans be made non-effective just prior to the arrival of the foreign traders. Also, action at this time will allow for opportunities of readjustment of employees of the companies to be dissolved.
4. Consultations with the Foreign Trade Division of ESS resulted in confirmation of the Antitrust and Cartels Division's conclusions that dissolution of these large trading companies was desirable and would not adversely affect foreign trade.
5. Dissolution conditions would require the following:
a. Elimination of use by other companies of the names of the trading companies to be dissolved.
b. Elimination of the right of top executives of the same companies or of several companies (being dissolved) to combine and organize an enterprise or join in an enterprise already organized for trading purposes.
c. Open market sale of assets of these trading companies in accordance with controlling legislation, ordinances, and directives affecting the disposal of assets.
Approved by: S. Fine ESS
A. Barber USCC
17 June
E. C. W.
