The groups listed and linked below formulate Generally Accepted Accounting Principles (GAAP) in Japan:

• The Business Accounting Council (BAC) produces Business Accounting Principles and audit standards with the support of the Financial Services Agency (FSA);
• The Accounting Standards Board of Japan (ASBJ) issues accounting standards, functioning under the auspices of the Financial Accounting Standards Foundation (FASF) as an independent, private-sector board;
• The Japanese Institute of Certified Public Accountants (JICPA) sets practical guidelines.

Japan has no unified insolvency code. The statutory provisions for the protection of creditor’s rights, including bondholders, are covered by a number of insolvency laws. Depending on the legal proceedings involved and the entity declared insolvent, creditor’s rights are covered under different laws.

For entities under liquidation, the following laws apply: Bankruptcy Law and special liquidation procedures in the Commercial Code, which are applicable only to stock companies called Kabusiki Kaisha. For entities under reorganization and/or rehabilitation, the following laws apply: Corporate Reorganization Law, as amended in 2002; Civil Rehabilitation Law; and company resolution procedures under the Commercial Code.

In bankruptcy, the prioritization of payments to creditors is as follows: (i) cost of administration, (ii) tax obligations, (iii) claims incurred by actions of the administrator, (iv) amounts owed to employees, and (v) general claims. With the exceptions provided by Articles 39 and 47, the Bankruptcy Law follows the basic principle of equality of payment for general creditors. Generally, secured creditors are exclusively covered by their security. Any claims uncovered by their security would be treated in the same manner as with general creditors.

Under a reorganization proceeding, there is no difference between domestic and foreign creditor claims as provided under Article 3 of the Corporate Reorganization Law.

Full-text English translations of these laws are not currently available. However, several studies have been made available for reference and links to relevant websites can be found below. Insolvency Asia provides a general discussion on claims of creditors, including foreign creditors, during insolvency proceedings.

The Asia-Pacific Restructuring and Insolvency Guide 2006 provides an explanation of the restructuring and insolvency frameworks in Japan. The World Bank developed its Doing Business indicators to measure the effectiveness and enforcement of business regulations.

To ensure and promote transparency in Japan's corporate sector, the Financial Services Agency (FSA) and its enforcement arm, the Securities and Exchange Surveillance Commission, enforce business standards among private corporations and within the securities market. The websites linked below provide codes and rules applicable to Japan.