Core Viewpoint - The Japanese government aims to establish a Japanese version of CFIUS by 2026 to enhance scrutiny of foreign investments and prevent technology and information leakage from domestic companies [2][4][7]. Group 1: Current Investment Review Mechanism - Currently, investment reviews in Japan are managed by the Ministry of Finance and relevant project departments, with a focus on national security-related enterprises [6]. - The existing system allows for pre-review when foreign investors hold a certain percentage of shares, and it includes scrutiny of foreign board members and business succession [6]. - As of now, there has only been one case where the Japanese government advised foreign investors to halt stock acquisitions, indicating a relatively low number of enforced reviews compared to other countries [6]. Group 2: Proposed Changes and Enhancements - The proposal includes creating a new coordination mechanism involving the National Security Bureau and other relevant ministries to enhance the review process [2][4]. - There is a consideration to amend Japan's Foreign Exchange Act to facilitate the establishment of detailed review procedures [4]. - The number of pre-review applications has surged to 2,903 for the fiscal year 2024, which is approximately five times the number from 2018, with over half of these related to the information and communication technology sector [6]. Group 3: Comparison with Other Countries - In 2023, the U.S. conducted only 342 pre-reviews, significantly fewer than Japan, despite Japan's reviews being perceived as less effective due to a smaller workforce [6][8]. - Japan ranks 196th out of 199 countries in terms of direct investment balance as a percentage of GDP, with only 5.9% [8]. - The Japanese government aims to increase the direct investment balance to 120 trillion yen by 2030, highlighting the need for a swift and effective review system to balance economic security and investment promotion [8].