The House of Representatives of Japan, controlled by the ruling bloc, passed a bill to inject public funds into financial institutions to bolster their capital bases at its plenary session Thursday.
The upper house, or House of Councilors which is dominated by the opposition, are expected to begin deliberations over the bill to amend the Act on Special Measures for Strengthening Financial Functions Friday.
The amendment is being proposed as an emergency measure in response to the global financial turmoil, which is feared to erode the capital bases of financial institutions around the world.
The bill would allow the government to accept applications for public funds from financial institutions until the end of March 2012.
Acting on a request from the main opposition Democratic Party of Japan (DPJ), the bill has been modified so as to include a provision that seeks management responsibility if the company's financial standing deteriorates for reasons other than the current financial crisis.
The bill would also require the disclosure of farm cooperatives which have received taxpayer money via Norinchukin Bank, the de facto central bank for Japan's agriculture, forestry and fishery cooperatives.
A supplementary resolution adopted by a lower house panel Wednesday would require a report to the Diet after public funds are injected into Norinchukin Bank. The DPJ had demanded advance approval from the Diet, a step the LDP rejected, Kyodo News Agency said.
The DPJ is expected to seek more amendments to the bill, including advanced Diet approval for tax money for the farm bank, in deliberations in the upper house, dominated by the DPJ-led opposition camp, and send it back to the lower house.
Source: Xinhua
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