The Financial Instruments and Exchange Act sets this prohibition1. It covers the contracts set by the Order for Enforcement of the Financial Instruments and Exchange Act. Over-the-counter financial futures transactions and crypto-asset-related OTC derivatives transactions are covered even when the client is a corporation. Other OTC derivatives transactions are covered only when the counterparty is an individual client2. A Cabinet Office Order lists exceptions, such as solicitation of clients with an ongoing business relationship3.

The term "不招請勧誘" (unsolicited solicitation) does not appear in the body of the Financial Instruments and Exchange Act. The headings of the Order for Enforcement and the Cabinet Office Order articles, and the Financial Services Agency's supervisory guidelines, use it to refer to this prohibition4. The prohibition does not apply when the counterparty is a professional investor5. The article on suitability and the duty to explain covers the provisions in detail.

Notes

  1. "金融商品取引法" (Financial Instruments and Exchange Act, in Japanese), Article 38, item 4. ↩

  2. "金融商品取引法施行令" (Order for Enforcement of the Financial Instruments and Exchange Act, in Japanese), Article 16-4, paragraph 1, items 1 and 2. The Financial Services Agency's "金融商品取引業者等向けの総合的な監督指針" (Comprehensive Guidelines for Supervision of Financial Instruments Business Operators, etc.), IV-3-3-2 (10) (page 168) (in Japanese), also states that transactions other than over-the-counter financial futures transactions and crypto-asset-related OTC derivatives transactions are covered only when the counterparty is an individual client. ↩

  3. "金融商品取引業等に関する内閣府令" (Cabinet Office Order on Financial Instruments Business, etc., in Japanese), Article 116, paragraph 1. ↩

  4. "金融商品取引法施行令" (Order for Enforcement of the Financial Instruments and Exchange Act, in Japanese), heading of Article 16-4 ("不招請勧誘等が禁止される契約," meaning "contracts for which unsolicited solicitation and similar acts are prohibited"; our translation); "金融商品取引業等に関する内閣府令" (Cabinet Office Order on Financial Instruments Business, etc., in Japanese), heading of Article 116 ("不招請勧誘等の禁止の例外," meaning "exceptions to the prohibition of unsolicited solicitation and similar acts"; our translation); Financial Services Agency, "金融商品取引業者等向けの総合的な監督指針" (Comprehensive Guidelines for Supervision of Financial Instruments Business Operators, etc.), IV-3-3-2 (10) (page 168) (in Japanese). ↩

  5. "金融商品取引法" (Financial Instruments and Exchange Act, in Japanese), Article 38, item 4 and Article 45, item 1. ↩