Corporate Recovery

This page collates articles on tax, legal and accounting issues in corporate recovery. Please also refer to the table of terms and definitions below on Japanese corporate recovery processes and related matters.

Articles on corporate recovery

Debt equity swap taxation

Debt equity swap taxation

12/09/2010 • On 15 September 2010 the 12th division of the Tokyo High Court issued a judgment concerning the taxation of gain...Read More

Impairment losses on shares in a subsidiary

Impairment losses on shares in a subsidiary

09/30/2010 • This case concerns a Japanese company which claimed a deductible impairment loss on shares in a recently acquired US subsidiary...Read More

Tax Controversy - Daiei taxed on forgiveness of debt to subsidiaries

Tax Controversy – Daiei taxed on forgiveness of debt to subsidiaries

07/31/2010 • Japanese retailer Daiei was assessed JPY25Bn (USD294m @85) for understating taxable income for four years.  The Asahi newspaper reported as...Read More

Corporations - secondary tax liabilities

Corporations – secondary tax liabilities

02/03/2010 • There are a number of routes in Japan by which a company may end up liable to meet another company's...Read More

Debt equity swaps - report of the 'DES Research Group'

Debt equity swaps – report of the ‘DES Research Group’

01/30/2010 • The Japanese Ministry for Economics and Industry (keizai sangyousho/経済産業省) has sponsored a private research group (the 'DES Research Group')  to...Read More

Business transfers in minjisasei proceedings

Business transfers in minjisasei proceedings

01/25/2010 • Advantages of a business transfer in minjisasei proceedings In the law relating to minjisaisei proceedings there are regulations that allow easy...Read More

Japanese corporate reconstruction - overview

Japanese corporate reconstruction – overview

01/25/2010 • Varieties of Japanese corporate reconstruction As is the case in many jurisdictions in Japan means of corporate reconstruction can be divided...Read More

Japanese methods of corporate re-habilitation - a comparison

Japanese methods of corporate re-habilitation – a comparison

01/24/2010 • Given that at the time of writing JAL is commencing the largest corporate rehabilitation in Japan it looks like a...Read More

Corporate recovery - useful definitions

Below are definitions and other background information for terms used in Japanese corporate recovery. The table includes links to both external sites with further information, although this is often in Japanese, and to posts within this site giving more information about the term concerned.
Japanese term/ trans- literationEnglish translationExplanation
民事再生/ minji saiseiCivil RehabilitationOne of the court approved insolvency procedures available in Japan. Characteristics include no legal limit to the entities that can apply the law, which was originally intended to apply to small and medium sized businesses. See her for more details and here for a comparison with the Corporate Rehabilitation law.
会社更生/ kaisha kousaiCorporate RehabilitationA further court approved insolvency procedure under Japanese law. Key features include precedence over other means of enforcing security and maintenance in place of existing management.
法的再生/ houteki saiseiCourt RehabilitationRehabilitations in the Japanese insolvency law that involve the intervention of the court or other public institution, including both Civil and Corporate Rehabilitation
私的再生/ shiteki saiseiPrivate RehabilitationIn contrast to Court Rehabilitation, private contractual proceedings resembling insolvency often carried out further to institutional guidelines.
私的整理ガイドライン/ shiteki saisei gaidorainPrivate Rehabilitation GuidelinesGuidelines issued by the government developed by a panel including major business, banking and other stakeholder groups intended to provide a framework for private rehabilitation
中小企業再生支援協議会/ chushou kigyou saiseishien kyoukaiSmall and Medium Size Business Rehabilitation Support Co-operativeConsultancies set up under local government to provide support and advice to small and medium size corporate reconstruction.
整理回収機構/ seiri kaishuu kikouResolution and Collection CorporationGovernment owned originally formed in response to the Jusen bankruptcies in resolve related debts.
企業再生支援機構/kigyou saisei shien kikouEnterprise Turnaround Initiative Corporation of JapanThe newest institution supporting the rehabilitation of Japanese corporations formed in October 2009 with a five year limited life as a private and publically invested company with ability to borrow funds guaranteed by the government its first main task is the corporate rehabilitation of JAL
企業再生税制/ jigyou saisei zeiseiEnterprise Rehabilitation Tax SystemSpecial tax regime introduced to apply to certain qualifying corporate rehabilitation transactions and conferring certain benefits such as priority in offset of expired tax losses against gains arising from debt expemption and recognition of unrealised losses on asset valuation.
債権放棄/ saiken houkiDebt AbandonmentRelease of debts without compensation.
債務免除益/ saimu menjo ekiDebt Exemption GainGain arising to debtor from the release of debts occuring, for example, on conclusion of a corporate rehabilitation plan under some of the procedures described above.
債務消滅益/ saiken sakugen ekiDebt Extinguishment GainGains treated for tax purposes in the same manner from Debt Exemption Gain but dinstinguished from it through arising from different circumstances such as the extingishment of debt by the debtor further to a debt equity swap.
期限切れ欠損金/ kigenkire kessonkinExpired Tax LossesLosses that have expired unused after the relevant carry-forward period, currently seven years in Japan
青色欠損金/aoiro kessonkinBlue Form Tax LossesUnexpired tax losses, referred to here as Blue Form tax losses as they are available to 'Blue Form' tax return filers which have to meet certain specified conditions around record keeping and similar matters.