Gas Panic Bar Raided by Police for "illegal dancing"

Tokyo Metropolitan Police raided two popular nightclubs within the Gas Panic chain in the Roppongi entertainment district early Sunday morning for improper licensing and took two employees into custody, reports TV Asahi (Nov. 28).

Police arrested managers Hidenori Wakita, 36, and Nishihata, 35, for allowing dancing at clubs Gas Panic Bar and Club 99 after 1 a.m. — a violation of the Law Regulating Adult Entertainment Businesses.

Nippon News Network reports that 150 customers were inside the two clubs when police arrived.
This is the second arrest in two years for Wakita. In 2009, police found similar violations at Club 99 and GP Bar, which is also within the Gas Panic chain, and took the manager into custody.

TBS News reports that average monthly revenues for Gas Panic Bar total 10 million yen.

According to police, the club installed a security camera at the door to alert management to turn the music down if police appeared.

“I realized that it is against the law, but I operated in this way to meet the needs of the customers,” Wakita is quoted by police.

http://www.tokyoreporter.com/2011/11/28/gas-panic-clubs-in-roppongi-raided-for-improper-licensing-two-arrested/


The weekend bust of two popular nightclubs within the Gas Panic chain was due to the presence of undesirable foreigners, reports Nikkan Gendai (Nov. 30).

Early Sunday morning, Tokyo Metropolitan Police entered clubs Gas Panic Bar and Club 99 in the Roppongi entertainment district and arrested managers Hidenori Wakita, 36, and Fumiki Nishihata, 35, for allowing dancing after 1 a.m. — a violation of the Law Regulating Adult Entertainment Businesses.
A journalist who covers the adult entertainment industry says the chain of foreigner-frequented bars is popular for those on low budgets, but in recent times police have been taking notice of trouble.

“Recently, poorly behaving foreigners from the Middle East and South-East Asia have started showing up,” says the source. “They make others not want to come around, and maybe some neighbors complained.”

The tabloid says that the raid of Gas Panic Bar occurred just before 2 a.m. “There were close to 200 customers in the place,” says a salaryman present at the time. “As the name says, it was a panic. At first, I thought they were targeting drugs or gangs. I was stunned that it was due to licensing problems since this sort of thing has been going on for 20 years.”

The issue concerns the type of license. Establishments within the Gas Panic chain are licensed as bars, which under the Law Regulating Adult Entertainment Businesses are not allowed to provide entertainment, such as dancing, after 1 a.m. without special authorization. Only drinking, however, is permissible.

This was the second arrest in two years for Wakita. In 2009, police found similar violations at Club 99 and GP Bar, which is also within the Gas Panic chain, and took the manager into custody. After that, Gas Panic Bar installed a security camera at the door to alert management to turn the music down if police appeared.

Wakita was eventually convicted.

This latest bust sends a message, continues the adult-entertainment journalist. “The crackdown will expand,” the writer says. “There are tens of thousands of improperly licensed clubs. Gas Panic is a big name, and they have continued to ignore warnings. Perhaps the police are taking a step forward to show the serious consequences to everyone else.”

http://www.tokyoreporter.com/2011/12/01/bust-of-gas-panic-bars-in-roppongi-due-to-poorl-behaving-foreigners/ 

October - Industrial Production up 2.4% - but outlook weak

Japan's government says industrial production rose 2.4 per cent in October from the previous month.
The reading marks the first climb in two months, though the Ministry of Economy, Trade and Industry expects it to dip again in November.

It describes industrial production as "flat."

Japanese manufacturers have been contending with multiple headwinds including a strong yen and a weak global economy that threaten exports.

The ministry's report on Wednesday said transport equipment, general machinery and chemicals drove October's expansion in factory output.

Shipments rose 0.6 per cent from September, and inventories climbed 0.8 per cent.

http://news.smh.com.au/breaking-news-business/japan-industrial-output-rises-in-october-20111130-1o61a.html

Japan's factory production rose for the first time in two months as auto and machinery makers expanded output while bracing for global headwinds.

Factory production in October rose 2.4 percent from the previous month, the government said Wednesday. In September, it slumped 3.3 percent.

Autos, general machinery and chemicals drove the latest increase, according to the Ministry of Economy, Trade and Industry's preliminary report.

It described industrial production as "flat" and expects another dip this month. It estimates a 0.1 percent decline in November and a 2.7 percent rise in December.

Masamichi Adachi, senior economist at JP Morgan Securities Japan, said the government's forecasts for the last two months of the year are "too optimistic" given rising inventories.

A strong yen and a weak global economy has been challenging for Japan's exporters. Along with the debt turmoil in Europe, the recent flooding in Thailand that has disrupted auto production has compounded worries.

A deputy governor of Japan's central bank underscored those concerns in a speech Wednesday in Kyoto, western Japan. Europe's sovereign debt problems represent the biggest concern for the global economy and could lead to lackluster growth around the world, Kiyohiko Nishimura said.

The yen has strengthened as a result, with global investors flocking to the Japanese currency as a safe haven. The yen has hit multiple historic highs against the dollar this year, forcing major manufacturers like Panasonic and Nissan Motor Co. to shift some production out of Japan.

Barclays Capital expects growth in industrial production to slow through the first quarter of 2012. But its chief economist in Japan, Kyohei Morita, does not believe that will lead to recession for the world's No. 3 economy.

Starting the second quarter, domestic demand will fuel growth as reconstruction after the March 11 earthquake and tsunami gains momentum, Morita said in a research note.

Shipments rose 0.6 percent from September, and inventories climbed 0.8 percent

http://www.boston.com/business/articles/2011/11/30/japan_factory_output_rises_but_outlook_weak/

October - Unemployment up, household spending falls, recovery waning?

Japan's jobless rate climbed for the first time in three months in October while household spending and incomes fell, adding to evidence that the country's post-disaster rebound is waning.

Government figures released Tuesday showed the unemployment rate adjusted for seasonal variations had jumped to 4.5 percent from 4.1 percent in September. Other recent indicators show slowdowns in exports and industrial production in the face of a strong yen and a sputtering global economy.

Japan's economy expanded at an annualized rate of 6 percent in the July-September quarter in an impressive comeback from the March earthquake, tsunami and nuclear accident. But economists have said such robust growth in the world's No. 3 economy is unsustainable.

The Organization for Economic Cooperation and Development said in a report Monday that Japan's "pace of recovery is now moderating."

The latest labor report is the second since September to include data from the three prefectures hardest hit by the disaster — Iwate, Miyagi and Fukushima. Between March and August, the government omitted the regions because of difficulties in gathering data.

Separately, the government's monthly report on households showed that families are tightening their budgets.

Average household spending in October retreated 0.4 percent from a year earlier to 285,605 yen ($3,650). Average monthly household income declined 1.8 percent in real terms to 479,749 yen ($6,135).

The OECD said Japan's economy should benefit next year from improved financial conditions and the government's planned reconstruction spending. It expects the gross domestic product to grow 2 percent in 2012.

"Soft global growth and the appreciation of the real exchange rate are, however, likely to check the pace of the upturn," the OECD said.


http://old.news.yahoo.com/s/ap/20111129/ap_on_bi_ge/as_japan_economy

Warren Buffet sees Japanese investment opportunities

Billionaire investor Warren Buffett said he’s unfazed by the recent scandal at Japanese camera maker Olympus Corp. and is looking for investment opportunities in the nation’s companies.

“We’re looking for companies that have some kind of sustainable competitive advantage,” Buffett, chairman of Berkshire Hathaway Inc., said today at a news conference in Fukushima prefecture, northern Japan. “The fact that Olympus happens here or Enron happens in the U.S. doesn’t affect our attitudes at all.”

Buffett, chairman of Berkshire Hathaway Inc., is visiting Japan for the first time to tour a plant of took maker Tungaloy Corp., after canceling his trip in March when the country was struck by a record earthquake. Olympus said this month that it concealed losses by paying inflated advisory fees, raising concern among investors about corporate governance in Asia’s second-largest economy.

“There are lots of opportunities in Japan,” Buffett, 81, said in Iwaki city, adding that the earthquake hasn’t changed his view on investing in the country. He said he is interested in “businesses that will be around for many, many decades.”

Iwaki is about 40 kilometers (25 miles) from the Fukushima Dai-Ichi nuclear plant that leaked radiation after it was crippled by the March 11 earthquake and tsunami. Buffett, who became the world’s third-richest person through long-term value investing, said earlier this year that the disaster created a “buying opportunity.”

“The fact that a renowned investor like Mr. Buffett is actually coming all the way to Japan and to the very place that became the center of the disaster means a lot and may shine a light,” said Shuhei Abe, president of Tokyo-based Sparx Group Co., Asia’s second-biggest hedge fund. “There are expectations that Mr. Buffett may invest more in Japan.”

Iscar Metalworking Cos., an Israeli company that was Berkshire’s largest acquisition of a non-U.S. firm, in 2008 bought a 71.5 percent stake in Tungaloy, which makes tools for cars and planes.

Japan’s stock benchmark Nikkei 225 Stock Average fell 0.3 percent today, extending losses to 18 percent this year. The gauge is set for the worst annual decline since 2008, as Europe’s escalating debt crisis and a global economic slowdown roil markets worldwide. Buffett, who is also Berkshire’s chief executive officer, has made bullish bets on the index through derivative contracts.

The earthquake and tsunami left more than 19,000 people dead or missing and led to an overall economic loss of $210 billion, making it the costliest natural catastrophe on record, Munich Re has said. Losses assumed by insurers, which Munich Re estimates at $30 billion, won’t reach the $62.2 billion caused by Hurricane Katrina in 2005, it said.

“Buffett’s investment is beautiful,” said Yutaka Kobayashi, president of Star Mica Asset Management Co., a boutique Japanese private bank. “Looking at the way he invests in this current market, it may well be a good time to be buying. His style of long-term investment makes sense under the current market climate.”

Buffett also said today that Europe will eventually emerge from a crisis that has been amplified by the inability of euro- zone members to print their own currency.

“One way or another, Europeans will solve their problems,” he said at the briefing. “But in the process of solving them there already have been very important dislocations and they will have effects on individual countries” and banks in the region that need capital, he said.

http://www.businessweek.com/news/2011-11-21/buffett-sees-investment-opportunities-in-japan-after-olympus.html

Q3 - Japan Leads Developing Growth in Growth

Advanced economies across the world grew by 0.6 per cent in the third quarter on a particularly strong showing of 1.5 per cent in Japan, the OECD says.

This is broadly in line with recent data from other leading economic bodies, pointing to weak overall growth except in some still robust emerging economies.

The overall data points to activity holding up in the third quarter, but probably a further weakening into 2012.

The Organisation for Economic Cooperation and Development said the Japanese figure, compared with output in the second quarter, reflected a surge in activity after the country got over the worst of the effects of the earthquake and tsunami earlier this year.

The rebound followed three quarters in a row of falling output in Japan, meaning the country was in recession.

Growth of the US economy picked up slightly in the third quarter to 0.6 per cent, the OECD said, but growth in both the 17-nation eurozone and 27 members of the European Union remained at 0.2 per cent.
This was despite a stronger performance of 0.5 per cent by Germany, 0.5 per cent by Britain and 0.4 per cent by France.

On a 12-month comparison, rather than a quarterly one, growth in the OECD area was 1.8 per cent, showing the same increase as in the second quarter.

The biggest expansion over 12 months was by Germany, with 2.6 per cent, and the weakest by Japan, at minus 0.2 per cent.


http://news.smh.com.au/breaking-news-business/japan-props-up-growth-in-leading-economies-20111118-1nlko.html

October - Exports fall for 1st time in 3 months

Japan's exports fell for the first time in three months in October, eroded by a strong yen and a sputtering global economy.

Exports declined 3.7 percent from a year earlier to 5.51 trillion yen ($71.7 billion), the finance ministry said Monday. Shipments to key markets such as China, North America and the European Union weakened.
The world's No. 3 economy relies heavily on overseas demand to drive growth. The slowdown suggests that its recovery from the March 11 tsunami and earthquake may be fading in the face of global headwinds.



Meanwhile, rising energy prices pushed imports up almost 18 percent to 5.79 trillion yen ($75.3 billion). That resulted in an unexpected trade deficit of 273.8 billion yen ($3.56 billion).

By category, exports of electrical machinery, including semiconductors and audio goods, fell 12.3 percent. Transportation equipment slipped 0.2 percent.

"Narrowing growth for auto-related categories suggests the post-quake supply recovery is tapering off," said Goldman Sachs economist Chiwoong Lee in a research note.

Economists predict Japan's gross domestic product will contract in the last quarter of the year after a recovery in exports helped it surge 6 percent in the July-September period.

The momentum is now being sapped by a strong yen, which shrinks the value of overseas earnings when repatriated and makes Japanese products less price competitive. The Japanese currency has hit multiple historic highs against the dollar this year as global investors flocked to the yen as a safe haven amid turmoil in the U.S. and Europe.

The currency levels have forced manufacturers including Nissan Motor Co. and Panasonic Corp. to shift some production overseas, a trend that could further undermine Japan's exports.


http://old.news.yahoo.com/s/ap/20111121/ap_on_bi_ge/as_japan_economy

Anti-Yakuza Laws Begin to Bite IV- Uncertainties for foreign business from new laws

A prediction: if Japan ever becomes a police state, it will come about not by national law but municipal ordinances. And the war on organized crime could be the engine that drives the process.

With the coming into force of its Organized Crime Exclusion Ordinance on Oct. 1, Tokyo joined every other prefecture in Japan in having a set of local regulations intended to make life miserable for yakuza and other organized crime groups. With so much international commerce being done through Tokyo, perhaps the foreign business community may start to take note of what these ordinances mean, since they affect businesses of all types. They also grant the police potentially significant powers to interfere in commercial affairs.

As with those of other prefectures, the Tokyo ordinance has the commendable goal of making it harder for mobsters to function in society. Recent revelations about allegedly improper expenditures by Olympus, which some have speculated could be evidence of ties to "antisocial forces" (code for mobsters), have focused a great deal of attention on this policy goal.

As is often the case in Japan, however, the question is whether a top-down approach will work in practice. As written, the Tokyo ordinance seems to be aimed primarily at preventing businesses from using the threat implicit in mob associations to gain commercial advantage, as well as both making it easier for members of crime syndicates to leave and harder for youngsters to be enticed into joining. It also seeks to hinder the ability of criminal groups to engage in any sort of legitimate commercial activities that might benefit their unlawful ones. It is here that the ordinance imposes some potentially significant burdens on businesses of all kinds.

First, the rules prohibit companies from knowingly engaging in business transactions that benefit organized crime groups.

Second, they impose on apparently all businesses in Tokyo an obligation to confirm that the people and companies they enter into contracts with are not mob-related. How an entrepreneur is supposed to do this is not explained ("Say, can everyone in your company use their fingers to count to 10?" "Is that white belt a 'cool biz' thing?" etc.). It would also seem difficult to do given Japan's recent ardor for privacy protection laws.

Third, and perhaps most significantly, all businesses in Tokyo are supposed to endeavor to include in all of their written contracts a clause that allows them to be canceled immediately if it is subsequently discovered that one of the other parties is a mob-related person. Additional rules apply to construction contracts and those for the sale or lease of real estate that might be used as a mob office.

Who exactly is a "mob-related person"? The helpful definition in the ordinance essentially says "someone who has a close relationship with a mobster or a mob group." For more clarity, one could look at other police regulations on organized crime, which include lineal blood relatives of mobsters. If applied to the ordinance, it would mean people could be subject to legally sanctioned discrimination in business merely because of the family into which they were born, a result that would seem unconstitutional. (The Japanese Constitution specifically prohibits discrimination based on family origin, but perhaps anything goes in the War on Crime.)

The ordinance's provisions on contracting seem to have been drafted by people who know very little about business, which is a shame because so much business gets done in Tokyo. While the metropolitan police have not done so yet, the Miyagi police have prepared a helpful set of model contract provisions to use in connection with that prefecture's anti-organized crime ordinance. Their model language fills an entire page, and suggests that contract parties sign an oath confirming they are not mobsters. This may be asking a lot in a country where a contract of six or seven pages may still qualify as "long" and simply the order in which contract parties appear in the contract can involve issues of corporate etiquette.

While the notion of chopping off ties with anyone bearing the yakuza taint may be simplistically pleasing in the abstract to local politicians and police bureaucrats, it adds a potentially significant element of risk allocation to all manner of business dealings — i.e., who gets left holding the bag if it turns out that one of the parties to the deal has a really intricate tattoo? In a complex multiparty transaction where hundreds of millions of yen are at stake, the ability to cancel a contract at any time for any reason may be a tough sell, particularly for foreign parties who are just trying to do business in Japan rather than solve its social problems. Even if all of the parties are comfortable that they are yakuza-free when they sign the contract, they still all have to live with the risk that somebody will later enter into some relationship that, perhaps inadvertently, makes them "mob-related," and renders the contract instantly terminable.

Some Japanese businesses are reportedly already feeling stymied by the new regulations. According to a recent article in the Tokyo Shinbun, the police have been providing helpful advice like "having the occasional drink with a childhood friend who ended up in a criminal group will not make you 'mob-related' "; "preparing a small funeral service for a mob boss and his immediate family is OK, but a huge memorial service attended by the whole syndicate is not"; and, "delivering a few bento boxes to a mob group for lunch is OK, but catering to a bigger meeting is not permitted."

While these examples are doubtless intended to reassure entrepreneurs, the mere fact that the ordinance seems to grant the police such sweeping powers to make almost completely subjective interpretations about the legality of commercial decisions seems disturbing.

Similarly, while these examples of guidance illustrate that the intended focus of the ordinance is to make it even more difficult for crime syndicates to eat, drink or work openly on a local level, the rules themselves contain no clear parameters as to their scope. Thus, as written the ordinance applies to all businesses equally, whether it is the neighborhood funeral parlor or a foreign multinational trying to buy a Japanese company headquartered in Tokyo.

If a private equity fund launches a tender offer for a major Japanese company, does it have to get all the shareholders to swear they are not mobsters and cancel the whole transaction if it turns out one of them is? Can "clean" shareholders who oppose the bid use an unsupported claim that other shareholders are mob-tainted to argue that an investment fund should go away? Indeed, how can businesses get rid of yakuza shareholders or partners if they can't even buy them out using arms-length, commercially reasonable contracts? One wonders what sort of advice the metropolitan police would give on these types of questions.

Even if the contract provisions function as expected, one has to question the wisdom of requiring businesses to terminate commercial contracts that are otherwise legitimate because of suspected mob connections. Aggressively asserting legitimate legal rights for extortionate purposes, whether as shareholders, tenants or otherwise, has long been a line of business for some mob groups. Since Japanese law has the concept of "abuse of rights," even if the contract provides a right of termination, the other party can claim that it was abused. Thus, a system that could give mobsters a steady stream of breach of contract claims might actually prove counterproductive.

What is a business to do about this new ordinance? Ignoring it may prove to be a viable strategy (not one that I am recommending, mind you). The rules only require businesses to "endeavor" to have contracts with the required language, and there are no direct penalties for failing to do so. Thus, the regulation could become one of the many Japanese laws and regulations everybody ignores until the police want to arrest someone or the media needs a shame story.

However, the strategy of ignoring the rules may not work for all companies, such as those that place a heavy focus on corporate social responsibility, or are subject to constitutional or contractual mandates that they conduct their businesses in accordance with applicable laws and regulations.

Even without penalties, the ordinance could have ramifications for corporate governance. Corporate directors have an obligation to ensure their companies are not fostering criminal conduct. Does failure to have the "suggested" language in all of their contracts constitute a breach of duty? What if they have the contract language but fail to terminate a major contract with a strategic partner based on a media report suggesting that the partner might have connections to someone who might be mob-related?

Ignoring the new regulations may not also work for the police, who are apparently now empowered by the ordinance to conduct warrantless "inspections" of all business premises and demand documents and other information. This power to engage in what would seem to be potentially wide-ranging infringements of basic civil liberties (not to mention interference with business) is softened by a requirement that the police officer conducting the inquiries show ID (er, don't they have already have to do that anyway?) and a provision stating that the process should not be considered a criminal investigation — very comforting indeed!

Companies might try to refuse on principle, but noncooperative businesses would apparently risk having their names publicized on a police-administered list of mobsters, mob affiliates and mob sympathizers. Will appearing on such a list make your business "mob-related" according to the new ordinance, and all your contracts thus terminable? The rules are not clear, but a lot of your customers and vendors may not want to take chances.

That the ordinance was not drafted with much consideration for the potential burdens it may place on business in a metropolis that aspires to be a global financial center is obvious. As for its effect on organized crime, it may just drive the mobsters deeper underground, a questionable result, particularly if it leaves the police as the only readily identifiable organized crime-related group making unreasonable demands on businesses.

http://www.japantimes.co.jp/text/fl20111115zg.html


Another article which discusses the new laws -

http://www.japansubculture.com/2011/10/october-1st-nationwide-in-japan-anti-yakuza-laws-go-into-effect-do-tell-we-wont-ask/

Anti-Yakuza Laws Begin to Bite III- Famous Temple Bans Yakuza, Police Anti Mob Squad joins Olympus Investigation

Enryakuji Temple, one of Japan's most prestigious temples near the ancient capital Kyoto, has refused to allow members of Japan's biggest organized crime syndicate to pay their respects there, an official said on Saturday.

The temple's refusal follows a request from police, who are cracking down on yakuza gangsters nationwide. News of the temple's refusal was reported widely by Japanese media amid speculation that organized crime was somehow involved in an accounting scandal at Japan's disgraced Olympus.

Members of Yamaguchi gumi group have made annual visits to the temple each August. In June, the temple in the Shiga prefecture of eastern Japan told the group they would not be welcome this year, said an official from the temple.

The Enryakuji temple keeps spiritual tablets from Yamaguchi gumi's late leaders, the official said. The tablets are wooden bars on which the Buddhist names of sick members are printed and are used for memorial services.

"We allowed them to visit the temple because we wanted to give family members ... an opportunity to pay a visit," said the official, who asked not to be named. "But in the past four years we have only seen the group members visiting, which is different from the original purpose," he said.

The temple also wanted to cooperate with police in cracking down on organized crime groups, he said.
Japanese authorities are investigating Olympus after the maker of cameras and endoscopes admitted it hid investment losses for decades using funds from acquisition deals.

A unit from the Tokyo Metropolitan Police Department's organized crime division has joined the investigation, according to a source familiar with the matter.

Links between companies, "yakuza" gangsters and politicians have a long tradition in Japan. Authorities have been trying to crack down for decades, most recently with laws targeting not only crime syndicates but firms that do business with them.

A 2010 report by the National Police Agency listed 22 designated crime syndicates, complete with their logos and the addresses of their headquarters.

Full and "associate" members totaled 80,900, down from 88,600 in 1990, of which almost half were members of the Yamaguchi-gumi, which is based in Kobe in western Japan.


http://old.news.yahoo.com/s/nm/20111119/wl_nm/us_japan_temple

Land in Disaster Areas Worthless

Land prices in areas devastated by the March 11 disasters have plummeted in terms of inheritance and donation tax calculations, and are effectively worthless in the immediate area of the Fukushima nuclear disaster, the government said Tuesday in releasing new price adjustment rates.

The rate stands at 0.2 for locations in Miyagi Prefecture hit by the tsunami, indicating an 80 percent fall in land prices, the National Tax Agency said.

For the vicinity of the Fukushima No. 1 nuclear power plant, the agency said it assigned a rate of zero because it is difficult to make a determination. This means land in the area has no value in the absence of transactions.

Although the agency assigned the negative adjustment rates to reduce the burden on taxpayers, the rates are expected to affect future land transactions.

They will be applied to people who acquired land through inheritance or donation prior to March 11 and were required to file tax returns by that date or later.

The rates cover disaster-affected locations in 10 prefectures, including Iwate, Miyagi and Fukushima, which were hit the hardest by the disasters. They cover around 65,000 sq. km, accounting for 17.1 percent of Japan's total land.

The tax agency based the rates on such factors as the scale of destruction, damage to essential services and the adverse impact on a region's image.

The rates range from 0.2 to 0.3 for coastal zones of Miyagi Prefecture and 0.3 for similar zones in Iwate and Fukushima prefectures.

Some locations in Urayasu, Chiba Prefecture, where liquefaction caused by the earthquake destroyed roads and water and gas mains, were assigned rates of 0.6.

After the 1995 Kobe earthquake, the lowest land price adjustment rate was 0.75, indicating a maximum land price fall of 25 percent. Negative adjustment rates were set at the time for around 2,000 sq. km.

http://www.japantimes.co.jp/text/nn20111101x1.html?