Impact on offshore development from changes in Chinese government policy, export controls, and other factors
First written in FY2022. 2 of 3 entries say "Mitigated", first in FY2024-Q1. Latest entry: 2026-03-30.
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- 2026-03-30MitigatedBusiness Plan
「Even if we were no longer able to export the systems we developed or outsource offshore development to China, the development process is not dependent to any significant extent on development bases in China, and domestic development partners in Japan could provide substitutes.」
The ability of domestic development partners in Japan to serve as substitutes was explicitly identified as a response to the potential impact of policy changes and export restrictions by the Chinese government, providing greater detail on the risk response. - FY2024-Q1MitigatedAnnual report
「Because direct operation in China of the financial information-systems business by 璞華国際, a subsidiary of the Company's Japanese entity, could hinder business development, the financial information-systems business was transferred to 璞華供給鎖 on 29 January 2024. At the same time, the Company entered into an agreement with Beijing 璞華互連, which owns 100% of 璞華供給鎖, to obtain effective control over 璞華供給鎖 and make it a consolidated subsidiary.」
To address the potential difficulty of operating a financial information-systems business in China directly through a Japanese subsidiary, the business was transferred to a local company and effective control was obtained through a contractual structure. The disclosure did not state that the broader policy and regulatory risks relating to China had been eliminated. - FY2022First statedAnnual report
「Outsourcing development to Chinese system-development subsidiaries is a source of competitive advantage in quality, delivery and cost. However, changes in Chinese government policy, such as restrictions on exporting systems developed there, could disrupt the Group's business operations.」
While outsourcing development to the Wuhan subsidiaries is described as a source of competitive advantage, disruption caused by Chinese policy changes or restrictions on system exports is disclosed as a risk.