Initiation Speech
June 8, 2011
Mr. Ichiro Shinjo
Mr. Masaaki Nangaku
Initiation Speech 1
Mr. Ichiro Shinjo
Notary, Ginza Notary’s Office
“Will Retrieval Service”
Japan National Notaries Association has started providing the Will Retrieval Service free of charge, which compiles information on “notarized will” and “secret will” made after 1989 and provide them when inquiries are made. As this service handles the most private information, we require the documents of 1) death certificate of the presumable testator, 2) document proving one’s qualification as legitimate heir, and 3) ID of the client.
The Notaries Association decided to review the overall Will Retrieval System, as a spate of malpractice cases emerged, due to numerous input errors on the required data. Also problems concerning data input of foreign nationals had to be revised.
This Will Retrieval System in the past required 6 items for retrieval: testator’s surname and first-name in both Chinese characters and kana readings, date of birth, and sex. Each notary got these 6 items from his/her client, which were checked at the Association as retrieval was made. If all the 6 items matched, the answer would be “relevant will exists.” If majority of the items matched, the answer would be “similar person exists.” For all other cases, the answer would be “no relevant will exists.” When I had chances to discuss with the responsible Association notaries, the following three problems came to the fore.
The first problem is with the retrieval items, especially concerning names of foreign nationals. They were classified into two groups, names with Chinese characters and names other than Chinese characters. The simplified Chinese characters used in China today complicated the matter, as they were identified as Chinese characters. Languages other than Chinese characters were required to be written in alphabets with kana readings. This means we imposed the Japanese-way of reading to languages using different vowels or consonants. Such strained readings caused serious confusions among all parties, including testators, the notaries who made the documents, Association notaries, as well as the clients who requested retrieval. After extensive discussions, we decided not to require kana readings to foreign nationals, and to compile only the date of birth and nationality as retrieval items, while saving image date of ID documents such as passport.
The second problem is with communication method between notaries and the Association. Notaries have traditionally made inquiries to the Association through telephone calls, fearing the risk of transmission errors by Fax or E-mails that could leak personal information. Now, we decided to accept Fax and E-mails, as they are more efficient, convenient and correct.
The third problem is how to handle cases of “similar person.” Association notaries classified those “similar person,” hoping the notaries would make further investigation and check the original notary documents before giving the answer to the clients. Yet, the notaries did not always make adequate investigation, which led to malpractice. We give guidance to notaries to make extensive investigation and provide accurate response to their clients, based on the assumption that “similar person” has high probability of being “qualified testator.”
I am determined to prevent further malpractices, by identifying their cause and making due amendments.
Initiation Speech 2
Mr. Masaaki Nangaku
Senior Executive Adviser,
Tokyo Commodity Exchange, Inc.
“Dramatic Changes of the Commodity Futures Market”
In futures trading, the “contract is concluded now, yet its execution is done in the future.” For example, the gold price is currently 4 million yen/kg. Contract is made to trade 10kg of gold at the same rate 6 months later. No matter how much the price fluctuates in the future, the trade is done at the contracted price. Commodity exchanges undertake such trading.
Futures Market is expected to play the following three functions or roles as an important segment of the industrial infrastructure.
The first is to “form a transparent and fair price.” Prices formed at exchanges are transparent and fair, as trading is based on clear rules, whose results are immediately made public. This is why spot prices often make reference to futures market prices as good indicators.
The second is to “hedge against the risk of price volatility.” As futures trading is based on pre-contracted price, it can decrease or eliminate price volatility risks in the future.
The third is to “provide a forum for asset management.” Futures trading has a speculative aspect, with huge losses or huge profits. This is why speculative funds enter this market, based on various future price perspectives.
Looking at its history, the rice trading at the rice market in Dojima, Osaka, in the 18th century is said to be the first futures trading. The rice market in those days meant a lot not only for ordinary citizens but also for feudal clans. How to hedge against the risk of the rice market volatility and achieve sound financial administration became imperative, which led to futures trading.
The world’s first modern commodity exchange is said to be the Chicago Board of Trade, established in the 19th century. The market in Chicago was established to hedge against the risk of agricultural product price. Later on, other commodities with high price volatility risks came to be traded. Nonferrous metals are traded at London Metal Exchange, while New York Mercantile Exchange trades West Texas Intermediate. At the Tokyo Commodity Exchange, gold, silver, crude oil or rubbers are traded.
Let me enumerate three dramatic changes now taking place at the commodity futures market.
The first is the rapid progress of IT and advancement of trading infrastructure. Today, “screen trading” made through computers has come to replace “floor trading” made by traders’ gestures or verbal communications.
The second is the tightening of governmental regulations. The government has focused on market regulation, as there were frequent troubles concerning sales of commodity futures trading after the War. Since this January traders are prohibited from soliciting customers unless the customers approach them. Thus, traders are working hard to adjust to the new business environment.
The third is the realignment of the exchanges. The two changes mentioned above induced a realignment of the exchanges. In 1965, there were more than 20 commodity exchanges in Japan. Today, there are only three left, two in Tokyo and one in Kansai. The “general exchange scheme,” included in the “new growth strategy” formulated by the current DPJ administration, plans to establish a new exchange that will trade stocks, bonds, financial futures as well as commodity futures. Let me emphasize that streamlining organizations does not automatically reinforce international competitiveness of the Japanese market. Regulating and supervising functions currently delegated to each ministry must be centralized to improve our competitiveness.