The government will include three requirements for companies to be eligible for tax breaks and loans in a new bill it is currently considering for developing the next generation 5G mobile network, sources informed the Nikkei. The three requirements are (1) security against information leaks, (2) stability of supply from the perspective of production system etc., and (3) openness that includes the adoption of international standards. The government believes that the three conditions will as a matter of course exclude Chinese companies from the preferential treatment.
The new bill is tentatively called the “act on promotion of dissemination of specified advanced information and telecommunications and other systems.” The government will submit the bill to an ordinary Diet session to be convened on Jan. 20. It is the first time for the government to develop a law on communications standards. The government will select companies eligible for the 15% corporate tax break for investments in 5G base stations, which is included in the bill related to the tax system, based on the three requirements. (Abridged)