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Report: Japan cabinet OKs proposed changes to foreign ownership rules

The Japanese cabinet on Oct. 18 approved changes to foreign ownership rules aimed at addressing national security concerns, Bloomberg News reported.

Under the amendments, foreign investors will need to obtain approval if they intend to buy a stake of at least 1% in a company in the defense, nuclear power, utilities and telecommunications industries. At present, foreigners are only required to seek government clearance if they want to purchase a 10% or larger stake in a company.

The government wants to pass the revised bill during the current parliamentary session, Bloomberg said.

Earlier this month, a group of foreign financial firms raised concerns over the planned revisions, which they said will have a "chilling effect" on investments coming into the Asian country and spark liquidity concerns.

To alleviate these concerns, the government intends to exempt foreign investors from adopting the revised rules on the condition that they will not influence corporate decisions and that the sectors they plan to invest in are not tied to the country's security, according to the report.