[NEWS] The Financial Services Agency announces its financial administration policy for the 2023 fiscal year, accelerating efforts in crypto assets and stable coins

On the 29th of last month, the Financial Services Agency announced its financial administration policy for the 2023 fiscal year. In order to realize the government's goal of becoming an asset management nation, the agency plans to strengthen the management capabilities of asset management companies and pension funds.

In addition, it is said that ordinary households have about 1,100 trillion yen in savings, and the agency aims to transfer these funds to investments to lead to asset formation for the people and corporate growth.

The Financial Services Agency has set out the following four policies as its priority efforts.

1. Support the stability of the economy and people's lives, leading to subsequent growth
2. Build a financial system that balances the resolution of social issues with economic growth
3. Ensure the stability and reliability of the financial system
4. Continually evolve and deepen financial administration

The financial administration policy announced this time places particular emphasis on item 2.

By connecting the savings and deposits of households to investment in order to achieve sustainable economic growth, the fruits of growth will be returned to the people as asset income, and a "virtuous cycle of growth and asset income" will be realized, which will lead to asset formation and further investment and consumption by the people.

To achieve this, the realization of a digital society and support for startups are essential, and the FSA plans to promote the creation of a financial environment that will lead to the creation of new markets.

In addition, the FSA will create an environment that encourages improved governance, including disclosure to stakeholders to ensure that operations are conducted in the interest of customers, and will disseminate information aimed at realizing an international financial center.

In addition, the announcement also reiterated the FSA's stance of promoting the spread and use of the new NISA (tax-free small investment system) and the "Asset Income Doubling Plan," which is centered on the enhancement of financial and economic education. The new NISA is scheduled to be expanded in January next year, and the FSA plans to make efforts to publicize the purpose and content of the system. It will also use digital technology to simplify and streamline NISA procedures.

It was also announced that the FSA will work to improve the environment to revitalize trading in both the primary and secondary markets for unlisted stocks, in order to facilitate fundraising for startups and liquidation and new investments for unlisted stock holders.

In order to realize a digital society, the government will promote the digitalization of financial services and digital transformation of financial institutions, and will support financial institutions and fintech businesses so that financial services can demonstrate their unique functions while protecting users and ensuring the safety of systems, and will support financial institutions and fintech businesses so that they can develop sustainably in a way that contributes to economic growth.

The government will also strengthen the functions and structure of the "FinTech Support Desk" to encourage entry by domestic and foreign businesses, and will internationalize "FIN/SUM" to promote the appeal of domestic fintech and create opportunities for networking among businesses, including those from overseas.

The government will establish "Japan Fintech Week" in March next year, actively disseminate information both domestically and internationally, and promote efforts to become a fund management nation.

The government will also incorporate efforts related to digital money and crypto assets (virtual currencies) to promote Web 3.0 and other trends.

In particular, the government will work to ensure smooth issuance and distribution of stable coins by carrying out efforts to quickly conduct registration screening for intermediaries, and encourage the establishment of a self-regulatory organization.

In addition, it was stated that the tax treatment, including legal and accounting practices, of crypto assets other than those held by issuers that are subject to end-of-period mark-to-market tax will be considered. This supports the efforts of the Japanese Institute of Certified Public Accountants to ensure opportunities for accounting audits of crypto asset issuers.

The FSA will also further consider the framework for the distribution of security tokens and their tax treatment, while taking into consideration investor protection. Utilizing the experience of effective monitoring of the crypto asset field to date, the FSA will contribute to international policy responses and cooperate with authorities in various countries regarding cross-border crypto asset transactions.

Reference: Financial Services Agency
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