New bulk export license for intercompany trade

Ministry of Economy, Trade and Industry ("METI") of Japan announced new bulk export license system for inter company trade to seek public comment on September 29, 2009.

This is special bulk license for 100% Japanese owned company (as parent company) to export overseas subsidiary which corporate share is more than 50 percent. The new bulk license is available for inter company trade between Japanese parent company and overseas subsidiary, while the export compliance training and audit is mandatory for granting the bulk license and the ultimate end-use is the subsidiary of Japanese company.

The new bulk license is called "Special Subsidiary Bulk Export License" and covers both goods and technology.
According to the draft of the notice, the overseas subsidiary is classified to Type A and Type B.
Type A special subsidiary is an end-user of items, while Type B is an importer of items.
Type B is supposed to be a subsidiary of trade house and sell items to Type A subsidiary in the imported country.

The items covered by this bulk license is broader than General Bulk License which is currently available for the company who have and implement solid ICP.
The Special Subsidiary License covers much broader items and the ship-to country and applicable items are identified in matrix of current bulk export license. In general, it covers NSG, MTCR, AG and Wassenaar controlled items, except very sensitive items and some high risk ship-to countries.

However, the bulk license is not valid in exporting to (and transship via) Iran, Iraq, North Korea and Libya.
Also, if it comes to be known that the item is to be used for WMD purpose, the license is not applicable and the exporter must report to METI.

This new inter-company bulk license is still in draft level and under public comment until October 27, the details may be changed later.
This is initiative by METI to grant more flexibility to well managed company, while Japanese government tighten the export control in technology transfer from coming November.

Looking at the definition of license holder, this new bulk license is not applicable for foreign companies in Japan, even if the company is registered as K.K. It is described as Shareholder is resident (= Japanese). Unfortunately, this system is for "genuine" Japanese companies.

(Source: http://search.e-gov.go.jp/servlet/Public?CLASSNAME=Pcm1010&BID=595109070&OBJCD=&GROUP=)