1. Ability Development and Management Support

  2. Financial Support

  3. Support of Technical Aspects

  4. Support under the Laws

(1) Loans

a)Loan for managerial improvement funds of small-scale enterprises ("MARUKEI")

The State provides low-interest loans that need no collateral or guarantors to those who start up businesses and small-scale enterprises that have undergone management guidance from management instructors of Commerce and Industry Associations or Chambers of Commerce and Industry for at least six months in principle. (An exceptional measure is applied to those who start up businesses before March 31, 2002.)

b)Special loans for start-ups

The State extends loans to supply funds for facilities and operation to those who newly start up business or SMEs that have been operating not more than five years since the start-up

c)Facilities fund system for small-scale enterprises

For those who start up businesses and small-scale enterprises, lending agencies of prefectural governments lend facility funds without interest, purchase necessary facilities to sell them by installment payment, or lease them.

d)Special loans for fostering new developing projects

Special loans are prepared to support venture businesses that utilize new techniques or offer characteristic goods or services. In the event of insufficient collateral, an exception to offering of collateral and a system where the Japan Finance Corporation for Small Business (JFS) accepts unsecured corporate bonds with subscription warrant are prepared.

(2) Credit Guarantee

a)Start-up support guarantee by Credit Guarantee Corporations

- Relevant start-up guarantee

Credit Guarantee Corporations provide unsecured debt guarantee to those who plan to start up a business and SMEs within five years since start-up.

- Guarantee related to new business creation

Credit Guarantee Corporations provide unsecured debt guarantee without a third party's guarantee to those who plan to start up a business, SMEs that have been doing business for not more than 5 years since start-up, and companies that plan to be spun off or that were spun off during the previous 5 years.

b)Venture support guarantee by Credit Guarantee Corporations

- New business exploitation guarantee

Credit Guarantee Corporations facilitate implementation of loans by extending debt guarantees for a business, in which the content of products or services, or the method of providing products or services, is not widely prevalent among SMEs.

- Guarantee related to management resource utilization

Credit Guarantee Corporations provide debt guarantee to SMEs that exploit new business such as development of new products, technologies, and services in accordance with a new business plan for management resource utilization that is approved under the Law on Special Measures for Industrial Revitalization.

- Business innovation- related guarantee

Credit Guarantee Corporations provide debt guarantee to SMEs that conduct new business activities such as development of new products and services in accordance with a business innovation plan that is approved under the Law on Supporting Business Innovation of Small and Medium Enterprises.

(3) Investment

a)Support for fund procurement by stock and corporate bonds through venture foundations

Prefectural foundations and others (venture foundations) support creative SMEs in their fund procurement through venture capitals (VC) by utilizing the upgrading loan system of JASMEC.

- Applicable entity:

A corporation or an entity that plans to found a corporation that is approved under the Temporary Law concerning Measures for the Promotion of Creative Business Activities of Small and Medium Enterprises (hereinafter, the "Law concerning the Promotion of Creative Activities of SMEs") or that is acknowledged by a venture foundation as qualified for said approval

- Details of support:

-- Indirect investment:	Investment (acceptance of stock, CBs, and warrant bonds) through VC that has received low-interest deposit as investment source from a venture foundation
-- Direct investment:	Acceptance of creative SMEs' stock and corporate bonds (CB and warrant bonds) by a venture foundation
-- Debt guarantee:	In order to encourage VCs to accept corporate bonds, venture foundations guarantee part (70%) of corporate bonds accepted by VCs when certain conditions are met (such as approval under the Law concerning the Promotion of Creative Activities of SMEs).
-- Venture lease project:	A venture foundation provides lease and sales by installment of facilities to venture businesses. Cooperative lease with a private lease company is also possible.

b)Investment project for promoting new business creation through the Limited Partnership for Venture Capital Investment

A private venture as an executive partner and JASMEC as a limited partner together establish a Limited Partnership for Venture Capital Investment to invest in domestic SMEs at an early stage of growth. JASMEC invests in the Partnership.

c)Investment by Small and Medium Business Investment and Consultation Companies

Small and Medium Business Investment and Consultation Companies accept stocks, CBs, and warrant bonds for entrepreneurs that establish a new business and enterprises with advanced or creative technology and know-how.

d)Promotion of risk money supply by the angel (personal investor) tax system

In terms of personal investment in the stock of R&D- type SMEs that have been established within the last ten years, in addition to the present angel tax system (capital loss may be carried over three years and added with capital gain on other stock), a new measure has been taken to reduce capital gain arising from public offering of stock considerably, to one-fourth.

(4) Subsidies

a)Project to grant subsidies for new business exploitation (by JASMEC)

Subsidies are granted, in combinations of focused and multilateral guidance by experts, for the development of prototypes, offering of services, and exploitation of sales channels by potential venture starters that tackle the actualization of a new idea that contributes to society with novelty and growth potential.

b)Project to grant subsidies for support of new business exploitation (by JASMEC)

Subsidies are granted to projects conducted by institutions that support ventures such as seminars and training for founders and new business pioneers, information provision, and guidance.

(5) Tax System

a)Special depreciation and tax credits concerning investment in equipment (measures under the Law concerning the Promotion of Creative Activities of SMEs)

In terms of machines for business use whose unit or set price is not less than ¥ 2.8 million (not less than ¥ 3.7 million for leased machines), tax credit of 7% of the acquisition cost or special depreciation of 30% (tax credit of 7% of the amount corresponding to 60% of the total lease cost for leased machines) is given to the following:

- A corporation (except certain associations) or a sole proprietor that has been doing business for less than 5 years since start-up and is currently engaged in the manufacturing, printing, software, or information processing service industries.

- When the ratio of experiment / research expense to sales is more than 3% than in the previous fiscal or calendar year.

- A corporation or a sole proprietor that intends to implement an approved business plan for research and development, etc.

b)Extension of the period allowed for carrying over deficits (measures under the Law concerning the Promotion of Creative Activities of SMEs)

For corporations (except associations) that intend to implement an approved business plan for research and development, etc., the period allowed for carrying over the deficit that generates during the period for implementing the approved business plan (until the business year includes the day after a full 5 years since the start-up) is extended to 7 years from the normal 5 years.

c)Carry-back of deficits

The deficit incurred in SMEs that are corporations established within the last 5 years may be carried back for the previous year.