Why it’s difficult to find stock brokers who provide their services in English




As the Immigration Law Practitioners, I’ve been working for business professionals in Japan who’ve come to Japan to work. Most of them of course ask about Immigration Law of Japan since I’m the professional on the Immigration Law Professional. But some people also ask about their questions on their daily life.

Recently, I got some questions about investment in Japan. There are some people who would like to use NISA and iDECO for their investment on stocks, ETF or other kinds of equities. But they can’t find a stock broker whose services are provided in English. I also searched the broker, But I can’t Then I also contact with some friends in financial industry, but they have no idea. Later I found the reason why it’s difficult to find an English- speaking stock broker is regulation on stock broker in Japan which was made to protect consumers. In this article, I’ll explain the reason.


Financial regulation requires consumer protection





Until Babble economy was collapsed. The stock brokers just focus on getting more contracts. Because stock price became higher and higher, many Japanese want to open their accounts and invest their money on stock. That situation made so many legal issues and litigations against stock brokers. Some sock brokers sold stocks for clients who has not able to understand what they invested.

Then the Diet of Japan made the new law named “Financial Instruments and Exchange Act(金融商品取引法)” This law was also designed to protect consumers who would like to use stock broker’s service. This is why the law has closures to regulates selling stocks.

One of the principles the law has is principle of suitability. This is the principle that stock brokers have to give their clients appropriate explanation when they sell stocks or investment instruments and the explanation have to be suitable given the client’s ability, investment experience. The reason why this principle was made is to make the opportunity that clients could understand what they invest and what kinds of risks this investment have For example, if a stock broker sell stock for 90 years old guy who’ve never invest his money for stocks, the broker has to explain from what is investment from the first place. They can’t make the contacts with clients who can’t understand what they do(investment).

Stock brokers have to do their sales activity while they follow the principle of suitability. They are quite careful when they check whether it’s ok to sell investment instruments for their clients.


This principle is the key point when they get non-Japanese clients.





That principle is the reason why it’s difficult to find an English-speaking stock broker in Japan. The stock brokers have to check whether they understand their explanation. They even give their clients piles of documents and explain then check whether the clients understand or not.

That is the issue for stock brokers when they get the clients who could not speak Japanese. Most of stock brokers in Japan has just Japanese clients. The number of clients from outside of Japan is quite small. So, they are not prepared to provide explanation in English. They have no way to give English speaking clients explanation which the clients could understand. So, stock brokers avoid selling to English-speaking clients. They don’t have confidence to provide their service in accordance with the financial regulation.


Now, the number of foreign residents in Japan is increasing. I think we might find a stock brokers who provide their service in English. I also think it could be big business chance.



Daichi Ito


Immigration Law Practitioner(Gyoseishoshi)


Profile


After graduating the Faculty of Law of Hosei University in Tokyo, Daichi Ito stated Kamakura International Legal Service(行政書士鎌倉国際法務事務所) and specialize in Immigration procedures and naturalization. Now He mainly handle PR application for various clients from highly skilled professionals to spouse VISA holders.


Office Address: 124 Zyuniso, Kamakura-shi, Kanagawa-ken

Office Hour; 9:00~17:00 Monday-Friday

E-mail: daichiito@kamalegal.com


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