In Japan, lending in the ordinary course of business requires a license either under Act No. 59 of 1981, as amended ("Banking Act") or under Act No. 32 of 1983, as amended ("Money Lending Business Act").

Generally, a foreign bank obtains a banking license as a foreign bank branch (gaikoku ginko shiten) under the Banking Act in order to provide any loan to a borrower in Japan that requires one or more of execution, delivery or performance of the finance documents. If the loan is a one-off, it could be argued that the lender is not acting in the course of its business. However, where a foreign bank that provides loans as part of its business makes the loan, even if the loan is its first in Japan, that argument will be unlikely to succeed.

The arrangement of a syndicated loan by a bank (including a foreign bank) is permitted as part of the bank's "incidental business" (fuzui gyomu), as set out in the Banking Act.

Where a nonbank arranges a syndicated loan and acts as an agent or intermediary for the finalizing of the loan agreement on behalf of a bank instead of on behalf of a borrower, it may be required to obtain a bank agent license (ginko dairigyo) under the Banking Act.

Similarly, because a facility agent or security agent only undertakes administrative functions, it is not required to obtain a bank agent license. However, if a security agent acts as a security trustee, it must obtain a trust company license, as required by Act No. 154 of 2004, as amended ("Trust Business Act").

Apart from the license required for lending in the ordinary course of business referred to above, there is no license or qualification that is required for a lender, arranger, facility agent or security agent to enforce its rights under the finance documents.

No. 

A bank that has a license under the Banking Act referred to in the answer to question 1 of this section (including a foreign bank that has a license as a foreign bank branch (gaikoku ginko shiten) under the Banking Act) must prepare and lodge a report or file documents in connection with its business or assets when requested to do so by the Financial Services Agency (FSA) as set out under the Banking Act.

A licensed moneylending business operator licensed under the Money Lending Business Act must file a business report every fiscal year as required by that act. Under the Money Lending Business Act, a moneylending business operator may also be required to provide reports if requested by the FSA or the prefectural governor.

In addition, depending on the types and volumes of loans, additional reports may have to be made to the finance minister or the relevant authorities under Act No. 228 of 1949, as amended ("Foreign Exchange and Foreign Trade Act").

No. 

Generally, yes. However, when a foreign bank/financial institution engages in marketing or solicitation in Japan directly or indirectly for its lending or other banking business, it must obtain a license of a Japanese branch of a foreign bank, Japanese banking license or money-lending business license unless it is lawfully conducted through a foreign bank agency licensed as such under the Banking Act.