In order to ensure peace and stability in the region, it is important to strengthen measures in the area of ​​economic security.

This time, I would like to introduce the ``Act to Partially Amend the Foreign Exchange and Foreign Trade Act,'' which was passed at the Diet session that closed last month, in order to appropriately respond to investments that may harm national security.

The Foreign Exchange and Foreign Trade Act (Foreign Exchange Act) maintains the principle of ``freedom of foreign transactions,'' and stipulates the ``Inward Direct Investment Examination System,'' which requires prior notification and is subject to examination by the Minister of Finance and the minister in charge of the business when a foreign investor acquires shares of a Japanese corporation operating a designated industry from the perspective of ensuring national security.

As the scope of security is rapidly expanding to include the economic field, the role that this ``Inward Direct Investment Screening System'' should play from the perspective of economic security has become even more important, and we have decided to improve the sophistication of this system.

Specifically, in order to "ensure the efficiency and effectiveness of examinations," ・In addition to clarifying measures to eliminate the risk of harming national security, etc. as items that should be reported, ・The act of indirectly acquiring the stocks, etc. of a Japanese company through acquisition, etc., of a foreign corporation that owns the stocks, etc. of a Japanese company, by another foreign investor, etc., has been added to the scope of regulations.

In addition, in order to "respond to environmental changes such as security," ・Investment activities of domestic investors that are under the control or influence of foreign governments, etc. are also subject to prior notification in certain categories. ・Reports are required in certain cases even for investments made by foreign governments and other high-risk investors that are not subject to prior notification, and recommendations and orders for the disposal of stocks, etc. can be made as necessary.

Furthermore, in order to "strengthen the cross-ministerial enforcement system," we recently established the Japan Foreign Investment Committee (JFIC), which requires the Minister of Finance and the minister in charge of business to consult the heads of relevant administrative agencies when necessary from the perspective of national security.

I made the ``Japan Foreign Investment Committee (JFIC)'' a manifesto during the Liberal Democratic Party presidential election from the perspective of strengthening economic security, and it was also stated in the coalition government agreement between the Liberal Democratic Party and Japan Restoration Party that we would aim to establish it during the recent Diet session.

Regarding the inward direct investment screening system, I have long had a strong awareness that the screening capabilities of the relevant ministries and agencies must be improved, and that it should not be vertically siled.

In order to address these issues, the Japan Foreign Investment Committee (JFIC) will strengthen the sharing of screening know-how and information sharing, including on the risk attributes of foreign investors, and raise the screening capabilities of the government as a whole. Additionally, we will build a system that allows cross-ministerial verification of the significance of the businesses and technologies owned by Japanese companies in which we invest in the supply chain of defense equipment and critical supplies.

Conducting consistent examinations across ministries and agencies in this way will ultimately lead to greater predictability for foreign investors, and through these efforts, we will achieve both ``promoting sound investment'' and ``ensuring economic security.''