Investment Management and Investment Advisory Business in Japan

■ The Financial Instruments and Exchange Act The "Investment Management and Investment Advisory Business" in Japan is subject to "the Financial Instruments and Exchange Act (hereinafter "the Act") which has been effective from September 30, 2007.

■ What is Investment Advisory Business conducted by our Member Firms Investment Management and Investment Advisory Business in which our member firms are engaged is classified into two categories. The first one is prescribed under the Act as Investment Management Business where member firms provide discretionary investment management service to their clients under a discretionary investment management agreement or to pooled investment vehicles excluding collective investment schemes established pursuant to the Law Concerning Investment Trusts and Investment Corporations. The second one is Investment Advisory & Agency Business where member firms provide investment advice to their clients, or act as an agent or an intermediary when concluding discretionary investment management or investment advisory contracts between investment management firms or investment advisory firms and their prospective clients.

. ■ Registration Requirements Under the provisions of the Act, any individual or corporation wishing to engage in Investment Management Business or Investment Advisory & Agency Business in Japan, must register with the Prime Minister.

■ Discretionary Investment Management and Investment Advisory Services In the case of investment advisory services, investment advisory firms provide only advice relating to securities investment, leaving the final investment decision to their clients. In discretionary investment management services, however, the powers necessary to exercise investment discretion are entrusted to investment management firms by their clients.