The government’s new advisory council on National Strategic Special Zones held its first meeting on Tuesday, January 7, and decided to focus in the coming two years on tackling so-called “bedrock” regulations, whose abolishment have been hampered for decades by strong opposition from related industries and ministries.
The law to designate special zones across Japan with looser regulations and special tax incentives was passed in the Diet in December. The advisory council headed by Prime Minister Shinzo Abe, which is vested with strong authority in determining the course of the government, aims to experiment with drastic deregulatory measures in the zones – the centerpiece of Abe’s growth strategy to invigorate business and make the nation more globally competitive.
The administration plans to designate the first special zones in March.
Five council members chosen from the private sector submitted a proposal concerning the zones, stating that additional deregulatory measures should be discussed with a view to revise related legislations in the next ordinary Diet session.
Keio University Professor Heizo Takenaka, one of the members, said all the bedrock regulations, mainly in the fields of agriculture, medical services and employment, will be subject to change.
Abe said at the meeting that he hopes drastic and speedy discussions will be conducted, based on proposals made from stakeholders nationwide.
Economic and Fiscal Policy Minister Akira Amari and Regulatory Reform Minister Tomomi Inada, also members of the council, expressed strong support for deregulation. Inada said that deregulatory measures which will be adopted in the special zones can be introduced nationwide, if it is desirable, after going through necessary discussions in the Regulatory Reform Council.
Regarding the agricultural sector, four deregulatory measures have been decided to be implemented in the special zones, such as those for agricultural production corporations. Under the current rules, more than half of directors of agricultural production corporations must engage regularly in agricultural businesses, including sales and processing of farm products, and more than half of the directors engaging in such businesses should be farmers. The latter rule will be deregulated to require one or more directors to engage in farm work.
Moreover, rules on the approval of transferring ownership of farmlands will be deregulated to allow municipal governments, instead of agricultural committees set up in each municipality, to undertake necessary procedures for the approval, if agreed upon by the committee.
Other planned deregulatory measures for the special zones include allowing the Credit Guarantee Corporation to offer guarantee to agricultural businesses to facilitate financing from private banks and credit associations, and allowing agricultural restaurants to be set up within areas designated as farmlands. These measures do not require law revisions.
(Jan. 8, 2014)