1992 Volume 34 Issue 3 Pages 1-18
The chief aims of the liquidation of the Zaibatsu was the dissolution of the Zaibatsu pyramids with holding companies at the peaks, and the destruction of the economic control exercised by holding companies and Zaibatsu families. As one of the means of liquidating the Zaibatsu, the democratic redistribution of the securities owned by the Zaibatsu and other combines was consequently an important problem. Demanded by the Supreme Commander for the Allied Powers, the amount of securities disposed of in the post-war period reached an enormous sum. But the directors of many limited companies feared takeovers of their companies. For the purpose of prevention against takeovers, many companies stealthily began to acquire their own shares in spite of the prohibition of Article 210 of the Commercial Code. With the peace treaty coming into effect in 1952, the restriction of owning stocks of other companies was relaxed. The former Zaibatsu companies were biginning to purchase small volumes of each other's stocks instead of holding own stocks. The resulting interlocked cross-shareholding made new conglomerate groups, so-called Kigyo-syudan and Kigyo-keiretsu. And the stocks of cross-holding have been functioning as securities for loans.
