Regulations on Payments Based on the Foreign Exchange and Foreign Trade Act of Japan
In order to ensure the implementation of economic sanctions under the Foreign Exchange and Foreign Trade Act of Japan (hereinafter, FEFTA), pursuant to Article 17 of FEFTA, MUFG has a duty to confirm that the customer’s remittances do not fall under a transaction restricted under the following regulations including but not limited to:
“Regulations on trade-related payment”, “Regulations on the purpose of use of funds”, “Regulations on payment ban”, “Regulations on foreign direct investment”, and “Regulations on service transactions”.
We appreciate your understanding and cooperation.
“Regulations on trade-related payment”, “Regulations on the purpose of use of funds”, “Regulations on payment ban”, “Regulations on foreign direct investment”, and “Regulations on service transactions”.
We appreciate your understanding and cooperation.
- Please declare the purpose of your remittance.
Please confirm and declare that the transaction does not fall under a transaction related to sanctions regulations under the FEFTA.
- Please confirm the counterparties of your remittance.
To the best of your knowledge, please confirm the followings.
- The transaction (1) does not directly or indirectly involve sanctioned parties designated under the FEFTA, such as Taliban, Terrorists, Proliferation Finance (parties involved in nuclear development, ballistic missiles or weapons of mass destruction by North Korea, and nuclear development by Iran), or parties involved in measures against Russia and Belarus (2) is not substantially controlled by sanctioned parties, and/or (3) are not conducted on behalf of sanctioned parties in the name of someone other than the sanctioned party (impersonation).
- The final recipient of the funds does not reside in North Korea, and the principal shareholders and board of directors of the counterparties are not corporations/individuals residing in North Korea.
- The final recipient of the funds or any other related parties do not involve the entities (excluding organizations with principal offices in Japan) where 50% or more of the total number of shares or the total amount of equity investment is directly owned by or effectively controlled by designated sanctioned parties under Russia and Belarus regulations.
- We may ask you to provide us with documents to confirm the details of your transaction.
We may ask you to present materials related to the transaction and confirm the details of the transaction. Further, please note in advance that we may decline a transaction if we are unable to confirm that the transaction does not fall under a transaction related to sanctions regulations (“Regulations on trade-related payment”, “Regulations on the purpose of use of funds”, “Regulations on payment ban”, “Regulations on foreign direct investment”, and “Regulations on service transactions”).
- Please check the latest regulations issued on the Ministry of Finance Japan (hereinafter, JMOF) Notification or JMOF website.
In response to Russia's actions against Ukraine, various restrictions under the FEFTA are imposed continually. Therefore, we kindly ask you to check the latest regulations on JMOF website (*) before submitting the above declaration.Additionally, on March 26, 2024, a joint alert regarding North Korean IT workers was issued by the Ministry of Finance and other relevant ministries in Japan. Should we receive requests for remittances or other transactions linked to companies suspected of being associated with North Korean IT workers, we will need to verify the details and may also refuse to process such transactions. For more information, please check the website of the relevant ministries below.
- (*) JMOF website, Latest Russian and Belarusian Regulations (Japanese only)
- JMOF website, Economic Sanctions and Designated parties (Japanese only)
- JMOF website, “Alert regarding North Korean IT workers” (March 26, 2024) (Japanese only)
Regulations on Payments Based on FEFTA (Excerpt)
1. “Regulations on trade-related payment” concerning North Korea
- Transactions pertaining to import or intermediary trade of all goods of which the place of origin or the region of shipment is North Korea (Effective October 14, 2006)
- Transactions pertaining to intermediary trade of goods of which the place of destination is North Korea (Effective June 18, 2009)
2. “Regulations on the purpose of use of funds” concerning North Korea
- Transactions conducted for the purpose of contributing to “activities that can contribute to North Korea’s nuclear-related plan, etc.” (Effective July 7, 2009)
3. “Regulations on payment ban” against North Korea
- Payment to individual or corporation who is domiciled in North Korea is generally prohibited unless it is for humanitarian purpose and its amount does not exceed 100,000 yen (Effective February 26, 2016)
4. “Regulations on the purpose of use of funds” concerning Iran
- Transactions conducted for the purpose of contributing to Iran’s nuclear activities (Effective January 22, 2016) (Updated October 27, 2023)
5. “Regulations on Foreign Direct Investment(*)” concerning Russia
- New foreign direct investment to the Russian Federation (Effective May 12, 2022)
- Payment of funds for business activities conducted in the Russian Federation and/or payment of funds for business activities conducted outside the Russian Federation in which Russian companies, etc., are involved (Effective May 12, 2022)
(*)Including acquisition of 10% or more of shares or investment in a foreign corporation, or loans with a term exceeding one year to a foreign corporation that one holds 10% or more of shares or investment (including amendments such as increase of amount)
6. “Regulations on Service Transactions” concerning Russia and Belarus
- Prohibition of service transactions (provision of technology, etc.) with respect to regulated transactions concerning Russia or Belarus (Sequentially effective from March 8, 2022)
7. “Regulations on Capital Transactions” concerning Russia
- Prohibition of transactions related to the issuance of claims etc., in respect to loan contracts and guarantee contracts for debts, related to the purchase of maritime transported Russian crude oil, etc., which are traded at prices above the price cap (Effective crude oil: December 5, 2022, petroleum products: February 6, 2023)
Note: Due to dependencies on certain system upgrades that are yet to be implemented, some of our systems may still be using the former phrase for declaration, specifically, “the transaction does not fall under a transaction related to Iran or North Korea restricted under the FEFTA” (or “NNK/NI”). We are diligently working on updating these systems. In the meantime, despite the use of this former phrase, we kindly request you to confirm and declare that your transaction does not fall under any transaction related to sanctions regulations under the FEFTA.
(As of July 2024)