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Japan to let state-backed R&D agencies invest in private sector

End of ban aims to energize sluggish startup funding, foster innovation

TOKYO -- Japan will lift a ban on investment in startups by state-backed research institutions in a bid to encourage partnerships and technologies that lead to new businesses.

Only one of the country's 27 national research and development agencies -- the Japan Science and Technology Agency -- is allowed to invest directly in private-sector businesses. The government plans to open up investment to other institutions, aiming to submit the necessary legislation during next year's ordinary session of parliament. The policy will be finalized at a meeting Friday of the Council for Science, Technology and Innovation, chaired by Prime Minister Shinzo Abe.

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