Japan's lower house passes bill to inject public funds into market
6/11/2008 17:52
The House of Representatives of Japan, controlled by the ruling bloc,
passed a bill to inject public funds into financial institutions to bolster
their capital bases at its plenary session today.
The upper house, or House
of Councilors which is dominated by the opposition, are expected to begin
deliberations over the bill to amend the Act on Special Measures for
Strengthening Financial Functions tomorrow.
The amendment is being proposed
as an emergency measure in response to the global financial turmoil, which is
feared to erode the capital bases of financial institutions around the
world.
The bill would allow the government to accept applications for public
funds from financial institutions until the end of March 2012.
Acting on a
request from the main opposition Democratic Party of Japan (DPJ), the bill has
been modified so as to include a provision that seeks management responsibility
if the company's financial standing deteriorates for reasons other than the
current financial crisis.
The bill would also require the disclosure of farm
cooperatives which have received taxpayer money via Norinchukin Bank, the de
facto central bank for Japan's agriculture, forestry and fishery
cooperatives.
A supplementary resolution adopted by a lower house panel
yesterday would require a report to the Diet after public funds are injected
into Norinchukin Bank. The DPJ had demanded advance approval from the Diet, a
step the LDP rejected, Kyodo News Agency said.
The DPJ is expected to seek
more amendments to the bill, including advanced Diet approval for tax money for
the farm bank, in deliberations in the upper house, dominated by the DPJ-led
opposition camp, and send it back to the lower house.
Xinhua
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