1. General
1.1 Overview of Derivatives
Markets
The regulation of derivatives under Japanese law is divided into
two major pieces of legislation, namely, the Financial Instruments
and Exchange Act (Act No. 25 of 1948, as amended, "FIEA")
and the Commodities Futures and Exchange Act (Act No. 239 of 1950,
as amended, "CFEA").
The FIEA regulates over-the-counter (OTC) derivatives
transactions falling under the definition of OTC Financial
Derivatives Transactions, which include OTC derivatives referencing
financial instruments such as interest rates, FX, equity, credit,
electronic payment instruments or crypto- assets. The concept of
OTC Financial Derivatives Transactions is further divided into the
following three categories: (i) securities-related OTC Financial
Derivatives Transactions (ie, OTC Financial Derivatives
Transactions which refer to securities); (ii)
non-securities-related OTC Financial Derivatives Transactions (ie,
OTC Financial Derivatives
