TOKYO -- Former Nissan Motor Chairman Carlos Ghosn could be released on bail as soon as Friday after the Tokyo District Court took the rare step Thursday of denying requests from prosecutors to extend his detention and that of Representative Director Greg Kelly.
The decision against keeping the pair in custody for another 10 days allows their lawyers to file requests for bail, which they probably will Friday. If the court approves, Ghosn and Kelly could be released from their monthlong detention that day.
Ministry of Justice data shows that only 0.21% of extended detention requests were rejected in 2017. "I've never heard of an extension request being denied in a case being handled by the special investigations section" of the public prosecutors' office, a former member of that section said.
The court's decision seems to have been swayed by rising criticism from foreign parties, argued attorney Masashi Akita. Ghosn's arrest and lengthy detention sparked outrage in France -- where he is a citizen -- and brought criticism from other international quarters. Questions were raised about Ghosn being removed immediately from his position as Nissan chairman, and speculation arose that Nissan had engineered a coup.
French newspaper Le Monde criticized the Japanese judicial system, noting that "individuals may remain in detention for weeks without trial or indictment."
"This will be a good opportunity to rework Japan's criminal justice system to meet international standards," Akita said.
Suspects are usually not allowed to contact alleged accomplices or witnesses while on bail. Even if bail is granted, Ghosn probably would be banned from contacting Nissan executives, including CEO Hiroto Saikawa, by any means -- neither in person nor by phone, email or teleconference. Ghosn, who remains a Nissan board member, also may be forbidden to participate in board meetings or in the annual shareholders' meeting.
The two executives were detained on Nov. 19 on suspicion of underreporting Ghosn's compensation over several years. On Dec. 10, prosecutors indicted Ghosn and Kelly for underreporting 4.8 billion yen ($43 million) of income in Nissan's annual reports for five fiscal years through March 2015.
They were also rearrested the same day and their detention extended for another 10 days on suspicion that they failed to report another 4.2 billion yen for three fiscal years through March 2018. When this period expired on Wednesday, Ghosn and Kelly entered post-indictment detention, during which they are permitted to seek bail. Prosecutors will continue investigating and determine whether to indict the pair on the additional charges.
In a news conference on Thursday, the Tokyo deputy chief prosecutor objected to the court's decision. "We believe further investigation is necessary," he said.
Courts have to see a "compelling reason" to keep suspects detained. In this case, the Tokyo District Court signaled that it sees no such reason to extend the detentions of Ghosn and Kelly.
This may owe partly to the fact that the allegations underlying the second arrest were virtually identical to the initial charges aside from the time period in question. Because both should be covered by the same investigation, extending the detention yet again to give prosecutors more time would be difficult to justify.
Following the court's decision, the Tokyo District Public Prosecutor's Office proceeded with an appeal, asserting that there is still a possibility of evidence being hidden. But that was also turned down by the district court.
Another former member of the special investigation department expressed skepticism about the decision to detain Ghosn and Kelly in the first place, noting that "evidence was gathered ahead of time through plea bargains" with Nissan executives suspected in involvement in the alleged financial misconduct. That reasoning could have led the court to conclude that the risk of significant evidence being destroyed was low.
When considering whether to grant bail, courts typically focus on whether a suspect is likely to appear in court. Ghosn is generally seen as a low flight risk.
Bail amounts are based on a person's ability to pay and the severity of the allegations. The bail money is returned once a trial ends, but if the defendant does not appear for trial or flees, the bail will be forfeited.
After the judge's decision, Nissan released a statement, saying: "We will withhold commenting on the judiciary judgment."