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Banking & Finance

Japan to relax listing rules for infrastructure trusts

As Tokyo preps for Olympics, private-sector cash eyed for sports arenas, gyms

TOKYO -- Japan's financial watchdog will remove restrictions on the type of public facilities listed infrastructure trusts can invest in as soon as next year to make it easier for the private sector to gain management rights in public facilities.

At present, infrastructure trusts are not allowed to list on stock exchanges if their investments include any public facilities other than 16 types, such as airports, roads, ports, railways and waterworks. The Financial Services Agency will jettison the limitation to allow investment in any public facilities, including arenas, gyms, educational facilities, exhibition halls, conference halls, parking lots and sightseeing spots.

The change, which follows a request from the Tokyo Stock Exchange, will likely make it easier to attract private-sector funds in the development of stadiums and other facilities ahead of the 2020 Tokyo Olympics.

A 2011 revision to legislation governing private finance initiative projects made it possible for the central government and localities to sell facility management rights while maintaining their ownership. The expectation was that this would help reduce their financial burden for the upkeep and updating of infrastructure. Relaxation of the rule for listed infrastructure trusts will likely further smooth the way for use of private-sector wealth in infrastructure development.

(Nikkei)

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