For PRO-BOND Investors

Who can invest in TOKYO PRO-BOND Market?

Update : Aug. 17, 2012

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Who can invest in TOKYO PRO-BOND Market ?

The TOKYO PRO-BOND Market, a new bond market for professional investors, is based on the “professional markets system” incorporated into the Financial Instruments and Exchange Act in 2008. Only specified investors and non–residents of Japan are eligible for purchasing securities listed on PRO-BOND. The current bond market targets institutional investors with the exception of a minority of corporate bonds issued for individual investors. The TOKYO PRO-BOND Market allows almost all of those who are currently investing in the bond market to participate. Overseas investors will benefit from a tax exemption for bond holdings for non-residents of Japan that was introduced in 2010.

•Specified Investors are defined as:
Qualified institutional investors (such as financial institutions)
Listed companies
Private companies with over JPY 500 million capital
The Japanese government and Bank of Japan
Local governments
•Approved Specified Investors (application to a securities company and approval required) are defined as:
Private companies other than those listed above
Individuals with over JPY 300 million in net assets and with at least one year of experience trading in financial instruments
•Non-residents of Japan

When soliciting purchases by specified investors of a bond issue to be listed on the TOKYO PRO-BOND Market, in principle, “limited transfer contracts”(1) between the issuing entity and the investor and (2) between the securities company and the investor are required. With regards to OTC (off-Exchange) trading of bond issues listed on the TOKYO PRO-BOND Market, solicitations, etc., for sales to specified investors which are accompanied by a “limited transfer contract” between the soliciting party and the investor are required.

When soliciting purchases by specified investors of a bond issue to be listed on the TOKYO PRO-BOND Market, the party conducting the solicitation must notify the party receiving the solicitation. With regards to OTC (off-Exchange) trading of bond issues listed on the TOKYO PRO-BOND Market, the party conducting the solicitation is required to notify the party receiving the solicitation.

Investors can make a comprehensive contract with the underwriter which covers all above requirements regarding a bond issue listed on the TOKYO PRO-BOND Market. After an investor makes the contract with the underwriter when the investor acquires a bond listed on the TOKYO PRO-BOND Market for the first time, the investor does not have to make another contract with the underwriter or to notify the underwriter when the investor trades with the underwriter or when the investor acquires a bond listed on the TOKYO PRO-BOND Market from the underwriter.


Attached are sample forms of the comprehensive contract.

•A sample form of the comprehensive contract (Japanese) Word
•A sample form of the comprehensive contract (English) Word

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