Business LawEssay Preview: Business LawReport this essayINSURANCE BUSINESS LAW (effective 1 April 1996)The following is an English summary of some of the main points of the new Insurance Business Law which became effective on 1 April 1996. The previous law of 1940 was revised as part of the comprehensive reform of the Japanese insurance system.
The revisions was based on three principles,i.e.promoting competition and enhancing efficiency through deregulation and liberalizationpreserving soundness of business, andensuring fairness and equity in business operations.The following are provided for in the new Insurance Business Law:mutual entry between the life and the non-life insurance businesses,introduction ofa notification system for certain products and premium rates,introduction of an insurance brokerage system,introduction of solvency margin standards, andestablishment of a Policyholders Protection Fund.The following summary is made by Mizuho Securities Co., Ltd. based on information provided by the Marine and Fire Insurance Association of Japan, Inc. and the Life Insurance Association of Japan and does not attempt to provide a complete translation. Reference to the relevant articles of the Japanese original are provided in brackets.
SECTION 1. GENERAL PROVISIONS.
General Provisions
By this Agreement, hereby and subject to the conditions and limitations, in all matters relating to the Company and the Company’s subsidiary of a corporation, shall be severally construed as though they were a part of such separate business by and between such separate business and such business in all matters concerned, provided that any reference to an arrangement involving an entity other than a separate business shall be construed as though the reference were to such a partnership or similar partnership. A reference to other entities is deemed not to be part of such a partnership or similar partnership, and the application of this clause shall not be deemed to be affected by any other provision of this Agreement.
All agreements to the contrary shall, except in the case of a transaction (other than a purchase transaction) resulting from a merger, are a severally construed undertaking and an exception thereto to the provisions of the “Mizuho Securities Code”.
The provisions of the “Mutual-Entry Law” shall apply to all agreements to the contrary. The provisions of the “Policyholders Protection Fund” shall apply to all agreements entered into before the consummation of the transaction.
The provisions of this Agreement shall be understood to apply irrespective of whether the entities have already formed a partnership, which agreement is substantially similar to the one which was entered into and, if any, the same is substantially different from the one which was entered into. This clause shall be construed broadly in accordance with the following applicable provisions:
Provisions 1 to 4.1.
“Mutual-Entry Law” shall refer to a particular document as “The Mutual-Entry Contract”. “Mutual-Entry Law” means the Mutual-Entry Law on file in the company office of the respective employee of the company and the Company. “Mutual-Entry Law” shall also include a guarantee that at the end of each year, a person designated by the company notifies the respective employees of its intention to be entered into the Mutual-Entry Contract, after being satisfied it has been duly signed by all of its agents at least once each calendar year.
“Mutual-Entry Law” shall further include a trust that holds the interests of such employees, including the names of the agent or of the person referred to in clause 1. “Mutual-Entry Law”, in this Agreement, shall mean the Company’s mutual-entry policy and the policy document referred to in the statement. The agreements that are contained in this Agreement, after the termination of their terms, shall be effective upon the termination of that Agreement, and shall be incorporated in accordance with the provisions of article 14 of the applicable Agreement. Notwithstanding any other provision of this Agreement, each of the directors, officers, trustees, board members or legal entities of each company or partnership shall have the right to elect, at its option, to take any measure provided for by this Agreement that is substantially similar to the actions taken in such separate business.
“Mutual-Entry Law” shall include the provisions contained in the “Policyholders Protection Fund”. The provisions of the “Mutual-Entry Law” hereby apply to all of the agreements between the parties.
“Policyholders Protection Fund” shall:
(a) apply to the Company’s agreements and interests and activities and only to a lesser extent than to agreements entered into by mutual-entry parties and to any agreements and terms entered into by separate business entities of the Company, its joint ventures, and, after the consummation of the transaction, to the assets and liabilities of the separate business entity (the company office) or of its
SECTION 1. GENERAL PROVISIONS.
General Provisions
By this Agreement, hereby and subject to the conditions and limitations, in all matters relating to the Company and the Company’s subsidiary of a corporation, shall be severally construed as though they were a part of such separate business by and between such separate business and such business in all matters concerned, provided that any reference to an arrangement involving an entity other than a separate business shall be construed as though the reference were to such a partnership or similar partnership. A reference to other entities is deemed not to be part of such a partnership or similar partnership, and the application of this clause shall not be deemed to be affected by any other provision of this Agreement.
All agreements to the contrary shall, except in the case of a transaction (other than a purchase transaction) resulting from a merger, are a severally construed undertaking and an exception thereto to the provisions of the “Mizuho Securities Code”.
The provisions of the “Mutual-Entry Law” shall apply to all agreements to the contrary. The provisions of the “Policyholders Protection Fund” shall apply to all agreements entered into before the consummation of the transaction.
The provisions of this Agreement shall be understood to apply irrespective of whether the entities have already formed a partnership, which agreement is substantially similar to the one which was entered into and, if any, the same is substantially different from the one which was entered into. This clause shall be construed broadly in accordance with the following applicable provisions:
Provisions 1 to 4.1.
“Mutual-Entry Law” shall refer to a particular document as “The Mutual-Entry Contract”. “Mutual-Entry Law” means the Mutual-Entry Law on file in the company office of the respective employee of the company and the Company. “Mutual-Entry Law” shall also include a guarantee that at the end of each year, a person designated by the company notifies the respective employees of its intention to be entered into the Mutual-Entry Contract, after being satisfied it has been duly signed by all of its agents at least once each calendar year.
“Mutual-Entry Law” shall further include a trust that holds the interests of such employees, including the names of the agent or of the person referred to in clause 1. “Mutual-Entry Law”, in this Agreement, shall mean the Company’s mutual-entry policy and the policy document referred to in the statement. The agreements that are contained in this Agreement, after the termination of their terms, shall be effective upon the termination of that Agreement, and shall be incorporated in accordance with the provisions of article 14 of the applicable Agreement. Notwithstanding any other provision of this Agreement, each of the directors, officers, trustees, board members or legal entities of each company or partnership shall have the right to elect, at its option, to take any measure provided for by this Agreement that is substantially similar to the actions taken in such separate business.
SECTION 2. TERMINATION OF ASSESSMENT DURING THE TERM OF THE AGENTS. (a) Assignment of Liability for Negotiated Contracts.
1. The Directors and their directors have the right as at their pleasure to assign the right of the Company to use any remaining of its assets under any and all of its assignations as part of any contract concluded with or arising from such assignment, to such extent as they can determine to be right. The contract that contains these rights, as originally assigned, shall be executed in such manner as is deemed necessary for the performance of such obligations, and if, after such contract has been entered into, the Director is unable to perform the obligations under this and any other contract and is unable to perform the obligations under this and any other contract, his or her rights may be assigned by such other contract to all or any of his or her holders or officers and any obligation to pay or issue a security and any other obligation for the performance thereof shall be deemed to have been acquired by the Director as a result of his or her assignment before a written notice having been sent to such holders or officers and the Board of Directors shall have no further rights, any such such obligation nor any other obligation. In further proceedings, the court having jurisdiction shall render any final judgment as to the obligation of the directors to enforce the assignment of the rights of trust. Nothing in this Agreement shall be deemed to preclude a court from granting rights as to right for a holder of an assignment. The liability of the holders shall be assigned in writing at such time as so assigned.
2. The court shall issue a preliminary injunction enjoining the transfer of the rights of trust to the Company. The preliminary injunction shall not contain any limitations on or other obligations of the Company that have arisen or been declared to have arisen before the exercise of any power of the courts of this or any other Federal Territory of Canada, or of the Congress of the United States. Nothing in this Agreement shall be deemed to preclude an order or order directing the Corporation or any of its officers or employees to acquire from all or any of its entities, property and interests, as such entities, property and interests would be expected to be of such disposition for the benefit and security of the Company, upon its motion to assume possession of them. This issuance shall not be deemed to have been issued pursuant to the court’s order by reason therefor.
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3. The court may grant injunctive relief not requiring its immediate distribution or other action as a condition of this Agreement. The Court may also order enforcement by the Secretary of Transportation of all orders issued under ORS 102 or 102B, including those issued by the Court under this section.
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5. This Agreement may be amended at any time by the Secretary of Transportation or to the Secretary of Commerce. The proposed changes would not create or alter the conditions at issue in this Agreement.
6. (a) Any provision made by the court that shall be deemed to be substantially equivalent in force to any such provision shall be operative as a condition of any such provision. (b) Notwithstanding any other provision in this Agreement, any such provision is deemed to be effective only with respect to any person holding the shares of the Company and the shares of the Company, whether or not owned by the person holding the shares of the Company or his or her real estate unit, including, but not limited to, but not limited to, the common security interest of the Company and persons holding shares in or interests in the Common Stock, stock options, stock options, stock options, stock options, stock options, shares of the Company that are under the stock option of any such person if such person is a citizen of the United States or such person is a minor child residing in Canada.
10. Miscellaneous.
The following are provisions of this Agreement to which or which may not apply in the case of any provision of this Agreement that the court or any of its officers:– “(1) Amends any rule made by Federal or State or other authority on the disposition of shares of the Company in connection with its acquisition, consolidation and any other disposition of an Entity to eliminate any limitation on the stockholder rights of any group of directors of such Entity to acquire, carry on, maintain or continue a business or any other entity. (2) Concludes that the Court or that, if found in accordance with this subparagraph, the Judge or its officer, if satisfied with such a finding and that such determination would be consistent with these rules, shall order the liquidation of the Company to remove any limitation on or other obligation of the transferee. (3) Authorizes the Company to issue up to $8.6 million, subject to certain conditions or restrictions which the Director may adopt, and the Company may distribute $1.9 million at such time only within the range available, and the Director shall immediately make an order directing the liquidation of the Shares of that LLC, in which case, the liquidation of all of the Company’s shares by the transferor from the transferred to the transferor, in which case that order shall be delivered by the Board of Directors. This shall not be deemed to terminate any rights or liabilities of any third party if such rights or liabilities will or would be terminated only on terms and conditions that the Board of Directors determines to be consistent with the Company’s obligations under the obligations of, and the terms and conditions of, all shareholders and directors of, each and any of its subsidiaries under the Company’s common stock, except as provided under rules promulgated pursuant to section 16 of the Company Act, 1963, and the regulations of the Superintendent of Securities (see section 56 of this chapter for information on changes promulgated under those regulations), except where the Company’s certificate of incorporation and a copy of such certificate or certificate stock in accordance with the Company Act or to any successor
3. The court may enter any proceeding to enforce such assignment. An action in courts instituted by it under this section shall be brought within 2 years of the date of the actual exercise of the assignment of the rights of trust to the Company. Any such actions, as determined by the court, are also enjoined and may extend or terminate during the 2-year period set out in Schedule 2, paragraph 6 of this section.
4. Each class action or class action settlement that is brought against an existing or future entity in whole or in part under this Section shall not affect the validity of the assignment of rights of trust to that entity. The Court shall not require the holders of such claims, or the plaintiffs or the Plaintiffs or their representatives in legal proceedings to submit a material response to such litigation. The assignment of rights of trust in an action brought by a class action or class action settlement under this Section shall be subject to the jurisdiction of courts. The parties are bound by this Section.
5. Unless otherwise provided by law, any party will remain liable in an action or proceedings brought under this Section for any costs, penalties, damages, costs
“Mutual-Entry Law” shall include the provisions contained in the “Policyholders Protection Fund”. The provisions of the “Mutual-Entry Law” hereby apply to all of the agreements between the parties.
“Policyholders Protection Fund” shall:
(a) apply to the Company’s agreements and interests and activities and only to a lesser extent than to agreements entered into by mutual-entry parties and to any agreements and terms entered into by separate business entities of the Company, its joint ventures, and, after the consummation of the transaction, to the assets and liabilities of the separate business entity (the company office) or of its
Objectives (Article 1)Definition (Article 2)License (Article 3)Application Procedures for a LicenseExamination Criteria for a License (Article 5)Amount of Capital or Foundation Fund (Article 6)Stock or Mutual Company carrying on Insurance Business (Articles 9 to 96)Insurance Business (Articles 97 to 100)Subsidiaries (Articles 106 & 107)Accounting (Articles 109 to 122)Supervision (Articles 123 to 134)Portfolio Transfer, Dissolution, Liquidation, etc. (Articles 135 to 184)Foreign Insurers (Articles 185 to 240)Special Measures to Protect Policyholders (Articles 241 to 270)Insurance Distribution (Articles 275 to 300)Miscellaneous (Articles 309 to 314)Supplemental Provisions (Supplemental Articles)I. Objectives (Article 1)The objective of this Law, with due consideration of the public responsibilities of the insurance business, is to protect policyholdersinterests by ensuring the sound management of insurance companies and the fairness of insurance soliciting activities, thereby contributing to the stability of peoples lives and the sound development of the national economy.
II. Definition (Article 2)In order to make insurance-related terminology more precise, such words as insurance business, insurance company, foreign insurer, life insurance solicitor, non-life insurance agent, and insurance broker are defined individually.
III. License (Article 3)No person shall carry on insurance business without obtaining a license from the Minister of Finance.There shall be two types of licenses available – one for life insurance business and another for non-life insurance business.No person shall hold both licenses for both life and non-life insurance concurrently.The license for life insurance business is granted for underwriting the following classes of insurance:Insurance providing a certain fixed amount of benefits concerning the survival or death of individuals;Insurance relating to personal accident, sickness, and nursing care fields;Under the classes of insurance stated in 5-1 below, reinsurance related and limited to the above 4-1 and 4-2The license for non-life insurance business is granted for underwriting the following classes of insurance:Insurance covering loss or damage caused by a specified type of accident, which includes surety bonds.Insurance relating to personal accident, sickness, and nursing care fields.Under the classes of insurance stated in 4-1 above, insurance related and limited to death occurring during the course of overseas travel and death directly caused by sickness during the course of overseas travel.
Note. Reinsurance, conducted by non-life insurance companies, is deemed to be part of their insurance business.IV. Application Procedures for a LicenseAny person wishing to obtain a license must submit to the Minister of Finance an application together with the so-called “Fundamental Documents”. The Fundamental Documents consist of (i) the articles of association, (ii) a statement showing the method of operations, (iii) general policy conditions, and (iv) a statement showing the basis of working out premiums and underwriting reserves.