shall grant appropriate relief in the form of restraining orders and injunctions and orders to enforce compliance. Also, the bill states that the court may order the revocation or suspension for any specified period of the voting rights evidenced by the securities acquired by the foreign investor in violation of Section 13(f), and the sale of any securities so acquired. The bill would also add a new Section 21 (h) to state that it is unlawful, for purposes of Sections 21(e), (f) and (g), for any person to cause, command, induce, procure or give substantial assistance to the commission of an act or practice constituting a violation of the Exchange Act.

Section 6 of S. 425 adds a provision to Section 32 of the Exchange Act to specify a penalty of $1,000 per day against any foreign investor who fails to file a statement required under Section 13 (f).

We have been successful in obtaining a variety of equitable sanctions for violations of the provisions of the laws we administer. The specific remedies proposed for violations of the screening provisions would, however, be effective deterrents to such violations. But, if the Congress intends to provide explicitly for such remedies, we urge that the Subcommittee extend these remedies to all other provisions of the Act to which they may be relevant, to avoid any confusion about the broad equity powers of the courts under the federal securities laws. Naturally, if such a change were made, it would be inappropriate, we believe, to extend civil enforcement powers to any entity or person other than the Commission, and, in appropriate instances, such as cases involving violations of the proposed beneficial ownership reporting requirements, the issuing company might be given explicit standing to sue.

Finally, we strongly endorse the provisions of S. 425 making the aiding and abetting of a violation of the Exchange Act an explicit violation of that Act, although under the cases construing the Act, aiding and abetting has always been deemed to be a violation.

49-480 75-9

Please find attached "Summary of Rules and Regulations
Established Pursuant to the Federal Securities Laws with
Regard to the Reporting of Ownership of Securities"
submitted by the Securities and Exchange Commission to the
Interagency Review of Current Federal Government Reporting
Requirements with Repsect to Foreign Investment in the
United States. This summary was made at the behest of
the Office of Management and Budget and the Council on
International Economic Policy.

We thought this might be of interest to you.

Sincerely yours,

Stonehu keragama

Yeiichi Kuwayama

Special Assistant

International Capital Markets

Index

Introduction

Section I

General Discussion of the Reporting of Ownership
of Securities to the Securities and Exchange Commission

Page

i

1

A.

B.

Description of Existing Data Collection Activities
Desirable Improvements in Data Collection Activities

1

9

C. Compliance with Existing Laws Restricting Foreign
Investment in the U.S.

13

Section II

Supplement to "Reporting Requirements and Dissemination
of Information of Corporate Ownership and Structure",
A Report From the General Accounting Office
("GAO Study")

A. Securities Act of 1933

14

14

C. Reporting Securities Ownership not Covered in A and B

List of Attachments

29

19

20