Japan’s New Plea Bargaining System: A Tough New Compliance Risk for Companies with Japan Operations?

I. Introduction
Various initiatives in recent years have set in train a number of reforms to the Japanese criminal justice system, including the phased-in introduction of the video recording of interviews with criminal suspects. The reform of most interest to businesses operating in Japan, however, is without doubt the introduction for the
first time in Japan of a plea bargaining system (the ‘New System’).

The New System, which was created pursuant to an amendment to Japan’s Criminal Procedure Code in May 2016, is due to come into effect by no later than June 2018. Together with the introduction in recent times of the ‘Principles for Listed
Companies Dealing with Corporate Malfeasance’and the strengthening of the whistleblowing regime through the new Japan Corporate Governance Code, the New System will likely have the effect of further incentivising both Japanese and
global companies in Japan to take meaningful steps to bolster corporate compliance in order to avoid the sometimes devastating consequences of serious corporate
malfeasance.

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