Industrial Policy & Trade Monitor· 2675 actions· ✨ 91 recent

On 2025-04-30, Japan's METI certified a supply-assurance plan (certification no. 2025永久磁石第1号-1) under the Economic Security Promotion Act (ESPA) for Shin-Etsu Chemical Co., Ltd. and its foreign subsidiary Shin-Etsu Magnetic Materials Vietnam, covering "permanent magnets" as a designated specified critical material. The certified plan's stated goal is introducing rare-earth-recovery recycling equipment to process end-of-life magnets, with a disclosed maximum subsidy of approximately JPY 3.7 billion (~USD 25.94 million). The certification is one of a running series of magnet-sector ESPA supply plans METI has approved since 2022.

Japan's Ministry of Economy, Trade and Industry (METI) overhauled the catch-all export-control framework under the Foreign Exchange and Foreign Trade Act (FEFTA) — the first comprehensive review of Japan's catch-all controls in 12 years (since 2013). Cabinet decisions were taken on 25 March 2025 and 4 April 2025 with METI's consolidated announcement on 9 April 2025; the amended Cabinet Order entered into force on 9 October 2025. The reform (i) splits catch-all-controlled items into "core items" (high dual-use risk, including certain semiconductors and machine tools) and a general catch-all tier, (ii) adds a new end-user requirement alongside the existing end-use requirement and extends both from UN-arms-embargo countries only to "general countries" (everywhere outside Group A), materially expanding the perimeter of items requiring METI export licences for general-country end-users including China, and (iii) introduces an "informed" condition for exports to Group A countries — once METI notifies an exporter of a defined risk pattern, a Group A export becomes licence-required, addressing transit-export-circumvention to Russia. Structurally distinct from the 23-category equipment-specific 2023 amendment (2023-03-31-japan-meti-semi-equipment-export-controls); this is the underlying horizontal catch-all reform and brings Japan's framework closer to US BIS EAR catch-all controls.

Japan's Cabinet approved an amendment to the Cabinet Order on Inward Direct Investment under the Foreign Exchange and Foreign Trade Act (FEFTA) on 1 April 2025; the order was promulgated 4 April 2025 and entered into force 19 May 2025. The amendment introduces two new investor categories — Type-A (investors legally or contractually obligated to share information with foreign governments) and Type-B (investors effectively in a comparable position without formal legal obligation) — and eliminates or narrows exemptions from mandatory prior-notification screening for both categories. The primary driver is concern over minority-stake acquisitions by Chinese investors in Japanese listed companies operating in sensitive sectors including cloud computing, telecommunications infrastructure, semiconductor equipment, and advanced electronics. The reform is structurally distinct from the outbound FEFTA catch-all controls overhaul (2025-10-09) and from the Economic Security Promotion Act (2022-05-18); it is the inbound FDI-screening complement to that framework.

Japan's National Diet enacted the Cyber Response Capability Enhancement Act (重要電子計算機に対する不正な行為による被害の防止に関する法律, Law No. 42 of 2025) on 16 May 2025, together with companion arrangement legislation. Commonly known as the Active Cyber Defense (ACD) Law, the statute authorises (i) government monitoring of foreign-origin internet traffic transiting designated Japanese communication infrastructure for national-security threat indicators, (ii) pre-emptive access and neutralisation operations against attacker infrastructure abroad by the National Police Agency and the Self-Defense Forces under unified command, and (iii) mandatory cyber-incident reporting and government cooperation duties on critical-infrastructure operators. Implementation is phased through November 2027, with the NISC reorganised into the National Cybersecurity Office (NCO) under the Cabinet Secretariat from July 2025.

Japan's Ministry of Economy, Trade and Industry (METI) revised its Foreign End-User List, the reference list of foreign organisations for which concern cannot be eliminated regarding involvement in the development of weapons of mass destruction and missiles, used to support catch-all export-licence requirements. The revision added 42 entities, taking the list to 748 entities from 15 countries and regions, and applies from 5 February 2025.