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P 190051Z MAR 09
FM AMEMBASSY TOKYO
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INFO RUEKJCS/SECDEF WASHDC PRIORITY
RHEHAAA/THE WHITE HOUSE WASHINGTON DC PRIORITY
RUEAWJA/USDOJ WASHDC PRIORITY
RULSDMK/USDOT WASHDC PRIORITY
RUCPDOC/USDOC WASHDC PRIORITY
RUEAIIA/CIA WASHDC PRIORITY
RUEKJCS/JOINT STAFF WASHDC//J5//
RHHMUNA/HQ USPACOM HONOLULU HI
RHHMHBA/COMPACFLT PEARL HARBOR HI
RHMFIUU/HQ PACAF HICKAM AFB HI//CC/PA//
RHMFIUU/USFJ //J5/JO21//
RUYNAAC/COMNAVFORJAPAN YOKOSUKA JA
RUAYJAA/CTF 72
RUEHNH/AMCONSUL NAHA 5380
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RUEHKSO/AMCONSUL SAPPORO 3584
RUEHBJ/AMEMBASSY BEIJING 8322
RUEHUL/AMEMBASSY SEOUL 4347
RUCNDT/USMISSION USUN NEW YORK 4242

UNCLAS SECTION 01 OF 10 TOKYO 000605 
 
SIPDIS 
 
DEPT FOR E, P, EB, EAP/J, EAP/P, EAP/PD, PA; 
WHITE HOUSE/NSC/NEC; JUSTICE FOR STU CHEMTOB IN ANTI-TRUST DIVISION; 
TREASURY/OASIA/IMI/JAPAN; DEPT PASS USTR/PUBLIC AFFAIRS OFFICE; 
SECDEF FOR JCS-J-5/JAPAN, 
DASD/ISA/EAPR/JAPAN; DEPT PASS ELECTRONICALLY TO USDA 
FAS/ITP FOR SCHROETER; PACOM HONOLULU FOR PUBLIC DIPLOMACY ADVISOR; 
CINCPAC FLT/PA/ COMNAVFORJAPAN/PA. 
 
E.O. 12958: N/A 
TAGS: OIIP KMDR KPAO PGOV PINR ECON ELAB JA
 
SUBJECT: JAPANESE MORNING PRESS HIGHLIGHTS 03//09 
 
Index: 
 
Defense and security affairs: 
1) Government to issue order at to Self-Defense Forces end of month 
to destroy incoming missiles from North Korea  (Yomiuri) 
2) Cabinet approval coming for missile-intercept plan  (Asahi) 
3) Government considering additional sanctions on North Korea if its 
launches a missile at Japan  (Nikkei) 
4) Defense Ministry will not budge on Okinawa request to change 
Futenma relocation plan  (Yomiuri) 
5) Democratic Party of Japan (DPJ) to call for adding Diet approval 
to the new bill allowing MSDF anti-piracy operations overseas 
(Mainichi) 
 
"Ozawa shock": 
6) As a result of the political donation scandal centered on party 
head Ozawa, the DPJ has been taking a flexible approach in its Diet 
tactics  (Tokyo Shimbun) 
7) The scandal set off by the arrest of an Ozawa aide for accepting 
illegal donations has upset Ozawa's election strategy to win big in 
the regions  (Mainichi) 
8) Twenty of Nishimatsu Construction's subcontractors in northern 
Japan were under the thumb of Ozawa's aide, who required them to 
donate contributions  (Mainichi) 
9) Ozawa's order to the DPJ to end acceptance of all donations from 
companies and organizations has set off debates in the ruling and 
opposition camps  (Nikkei) 
 
10) Liberal Democratic Party's (LDP) Kunio Hatoyama has set up a new 
political group, apparently in anticipation of making a bid for 
party president  (Sankei) 
 
11) Under Kyoto Protocol, Japanese government has purchased 30 
million tons of emission rights from Ukraine  (Asahi) 
 
12) Fair Trade Commission has fined 12 air cargo companies for 
running a cartel  (Sankei) 
 
Articles: 
 
1) Gov't to order SDF to destroy N. Korean missile 
 
YOMIURI (Page 2) (Full) 
March 19, 2009 
 
Concerning North Korea's readiness to launch a ballistic missile as 
a "satellite," the government decided yesterday to order the 
Self-Defense Forces as early as late this month to destroy missiles 
and any other projectiles to prevent their landing on Japanese 
territorial soil or waters. This missile destruction order will be 
issued by the defense minister in conformity with SDF Law Article 
82-2 since the SDF will intercept missiles with its missile defense 
(MD) system. The law stipulates that the SDF is to destroy 
"ballistic missiles and the like" flying toward Japan. The 
government takes the position that they include satellites and their 
launching vehicles that may fall in Japan's territorial soil or 
waters due to an accident or for some other reasons. 
 
The SDF law preconditions the issuance of a missile destruction 
order on the prime minister's approval. Specifically, a missile 
destruction order will be issued after a cabinet decision. The 
destruction order is expected to be made public. 
 
TOKYO 00000605  002 OF 010 
 
SUBJECT: JAPANESE MORNING PRESS HIGHLIGHTS 03//09 
 
 
Meanwhile, the SDF law stipulates that the defense minister may 
issue a missile destruction order to the SDF beforehand during a 
certain period of time in order to provide against an emergency. In 
this case, there is no need for a cabinet decision. However, the 
defense ministry fears that North Korea may launch a missile after 
the preissued order's expiry, according to one of the ministry's 
senior officials. Given this, the government will not make public 
whether it has issued a missile destruction order. 
 
The government has not decided whether or not to issue the missile 
destruction order after adopting it in a cabinet meeting. 
 
The SDF, once it receives the order, will destroy a missile or other 
projectile outside the atmosphere that will land on Japan using SM-3 
missiles launched from an Aegis vessel, and if the missile slips 
through, destroy it with ground-based PAC-3 missiles. If the missile 
will not fall on Japan, it will not be intercepted. 
 
2) Cabinet decision in focus for missile intercept 
 
ASAHI (Page 4) (Full) 
March 19, 2009 
 
North Korea has recently declared its plan to launch a "satellite." 
In response, the government is now studying whether it will make a 
cabinet decision on a "ballistic missile destruction order" to be 
issued under the Self-Defense Forces Law. The government is also 
studying where to deploy the Patriot Advanced Capability 3 (PAC-3), 
a land-based ground-to-air guided missile. This, however, may fan 
public anxiety or incur North Korea's sharp reaction. The government 
will therefore make a careful judgment. 
 
Concerned about public unrest 
 
The missile destruction order is prescribed in an amendment of 2005 
to the SDF law. This destruction order, if issued, would be applied 
for the first time. The SDF, based on this destruction order, is to 
destroy missiles and any other projectiles like satellite-launching 
vehicles should they land in Japan. Chief Cabinet Secretary 
Kawamura, meeting the press yesterday, stated: "We must make efforts 
to wipe away the people's anxieties. We're studying whatever we can 
do for crisis management while anticipating every possible 
situation." 
 
There are two missile destruction orders. One is based on a cabinet 
decision. This destruction order will be issued by the defense 
minister to the SDF after it is adopted in a cabinet meeting. The 
other destruction order is to be issued beforehand by the defense 
minister without a cabinet decision. This order is intended to 
provide against an emergency. A Defense Ministry official says the 
order should be based on a cabinet decision. If the order is issued 
at the defense minister's discretion only, the Defense Ministry will 
have to be held responsible. The Defense Ministry therefore wants to 
get a cabinet endorsement. One government source said: "If the 
government makes a cabinet decision to adopt this order, it means 
the government acknowledges that a missile may head toward Japan. 
Even if North Korea does not aim at Japan, I don't know if they 
think their missile is a piece of junk and might fall on Japan. As 
for the rest, it's up to a political judgment." 
 
One high-ranking government official will respect the Defense 
 
TOKYO 00000605  003 OF 010 
 
SUBJECT: JAPANESE MORNING PRESS HIGHLIGHTS 03//09 
 
Ministry's judgment, saying: "As for whether a cabinet decision is 
needed or not, the Defense Ministry will primarily make a judgment. 
Based on that, the government will study this matter." The 
government is expected to shortly hold a meeting of the chief 
cabinet secretary, foreign minister, and defense minister for 
coordination in the final phase. 
 
But there are also cautious arguments about making a cabinet 
decision to adopt the missile destruction order. This will make it 
easy for the government to alert the nation. However, it may 
heighten public fears. "This is the most important thing we should 
consider," an aide to the prime minister said. A senior official of 
the Cabinet Secretariat indicated that if we're in a panic and if 
many people will not go out, that will only benefit North Korea. 
 
Where to deploy PAC-3 batteries 
 
The PAC-3 for missile interception is currently placed at nine air 
defense missile detachments in the Kanto and Chubu regions. North 
Korea says its "satellite" will be passing over the northeastern 
districts of Japan. If it does so as North Korea says, the PAC-3 
will not be able to cover the districts. The PAC-3 is capable of 
covering areas within a radius of several dozen kilometers. PAC-3 
batteries, when moved out for missile interception, will have to be 
deployed near predesignated areas for defense. The Defense Ministry 
is also thinking of mobilizing the PAC-3 batteries to the 
northeastern districts. However, the ministry will have to make a 
difficult judgment for where to deploy the PAC-3. 
 
Ballistic missile destruction order for two cases 
 
 Based on cabinet decision Preordered by defense minister 
Conditions If and when a missile is feared to come flying to Japan A 
missile is not feared to come flying to Japan, but to provide 
against an emergency 
Procedures The defense minister issues with the prime minister's 
approval The defense minister issues without the prime minister's 
approval 
Public announcement Upon a cabinet decision Not made public 
Plus Easy to alert the public. Easy to ready PAC-3 deployment. Easy 
to ensure civilian control. Not fan public unrest. Not irritate 
North Korea. 
Minus Public anxieties may spread. Order issued will be made known 
to North Korea as well, highly likely to incur North Korea's 
repulsion. PAC-3 deployment requires public accountability. Hard to 
alert the public. Civilian control feared to be insufficient. 
 
3) North Korean missile issue: Government seriously considering 
additional sanctions, such as expanding export ban and extending 
period of ban 
 
NIKKEI (Page 2) (Abridged slightly) 
March 19, 2009 
 
The government has begun seriously considering the imposition of 
additional sanction measures in reaction to the expected ballistic 
missile launch by North Korea. Key options include expanding the ban 
on exports and prolonging the sanctions period. At the same time, 
there is a view that the impact of Japan's alone taking sanctions 
would be limited. The government intends to make a decision after 
monitoring developments in the North and public opinion. 
 
 
TOKYO 00000605  004 OF 010 
 
SUBJECT: JAPANESE MORNING PRESS HIGHLIGHTS 03//09 
 
Keiji Furuya, chair of the abduction issue special committee of the 
Liberal Democratic Party (LDP), made a request yesterday to Chief 
Cabinet Secretary Takeo Kawamura to impose additional sanctions on 
North Korea. Furuya quoted Kawamura as saying in response: "If the 
North continues taking a provocative attitude, we need to impose 
such sanctions." 
 
The special committee chiefly consists of ruling party members with 
hard-line views toward the North. Additional proposed sanction 
measures finalized by the committee in March include: (1) extending 
the sanctions period, which is to expire on April 13, for another 
year instead of six months, as has been done in the past; and (2) 
banning all exports of goods to North Korea. The Prime Minister's 
Office (Kantei), too, has been studying steps since last week with 
officials in charge from all relevant government agencies. 
 
The government is envisaging a two-stage approach: a UN Security 
Council sanctions resolution and Japan's independent sanctions. 
China and Russia are reportedly reluctant to adopt a UN resolution. 
Some observers think if the North launches a satellite, as claimed, 
adopting a UNSC resolution would be difficult. 
 
The opinion is gaining ground in the government and the ruling bloc 
that if the UN fails to adopt a sanctions resolution, Japan should 
go ahead and step up its sanctions independently. According to the 
North's report to the International Maritime Organization (IMO), the 
first stage of the "satellite" rocket is expected fall in the Sea of 
Japan. "Since the area (designated as a danger zone by the North) is 
close to Japan, we need to raise our voice regardless of reactions 
of other countries," a Kantei source said. 
 
In the event Japan imposes sanctions independently, to what extent 
the step would work as pressure on the North remains unknown. Japan 
has already banned North Korean ships from calling at Japanese ports 
and economic exchanges between Japan and the North have been 
reduced. 
 
Given that the abduction issue has made no progress, if the North 
fires another missile, Japan cannot afford to overlook it. A prime 
ministerial aide took this view: "Policy-wise, there is room for 
considering options, but there is no option for a political 
decision." 
 
4) Defense Ministry plans to implement Futenma relocation just as 
originally planned; Environmental assessment report ready 
 
YOMIURI (Page 2) (Excerpts) 
March 19, 2009 
 
In connection with the relocation of the U.S. Marines' Futenma Air 
Station (Ginowan City, Okinawa Prefecture), the Defense Ministry has 
firmed up its policy intention to go ahead with the original plan 
and not alter the location of site for the alternate facility. It 
will first ready a report with the results of an 
environmental-assessment survey carried out in coastal portion of 
Camp Schwab (Nago City, same prefecture), which is the relocation 
site. Although the prefecture has sought to have the relocation site 
move into the sea waters, citing the noise factor, the government in 
its survey did not come up with a rational reason for complying. The 
preparatory report will be presented to Governor Hirokazu Nakaima 
possibly in early April. 
 
 
TOKYO 00000605  005 OF 010 
 
SUBJECT: JAPANESE MORNING PRESS HIGHLIGHTS 03//09 
 
The governor will next prevent his view of the preparatory report, 
based on the Environmental Protection Law. He is expected around 
September to again assert that the site be moved into the sea. The 
government aims to start construction of the new facility in 2010 
and complete the relocation by 2014. Since landfill operations along 
the coastline require the approval of the governor, the focus will 
be on how the government responds, after hearing the view of the 
governor. The U.S. side is against moving the site into the sea, 
saying the plan should be implemented as originally agreed by the 
U.S. and Japan. 
 
5) Anti-piracy legislation: Use of MSDF the biggest point at issue; 
DPJ sorts out points at issue, including reporting to Diet 
 
MAINICHI (Page 2) (Abridged slightly) 
March 19, 2009 
 
Yoshitaka Koyama 
 
In the wake of the government's presentation of anti-piracy 
legislation to the Diet, the members of the Democratic Party of 
Japan's (DPJ) foreign affairs and defense departments met yesterday 
to sort out the main points at issue. The legislation stipulates, 
"When the Japan Coast Guard (JCG) finds it difficult to deal with, 
the Maritime Self-Defense Force (MSDF) shall be dispatched." In 
yesterday's meeting, many indicated that the use of the MSDF was too 
abrupt. The group defined the need to dispatch the MSDF as the 
biggest point at issue, while deciding to seek an explanation for 
it. The group also pointed out the need for Diet approval of such 
dispatches. 
 
The discussion was based on a report produced on March 17 by Policy 
Research Committee Chair Masayuki Naoshima and the foreign and 
defense ministers of the party's "next cabinet." One member pointed 
out the option of using diplomatic efforts to promote reforms in 
pirate-infested Somalia, which is in a state of anarchy. Another 
member voiced the need to increase the JCG's budget to build ships 
fit for long cruises. 
 
The prevailing view at the discussion for sorting out points at 
issue was that the party envisioned revisions to the government's 
bill. The DPJ, however, has yet to determine its final policy 
course. The members will meet again on March 19 to finalize the 
points at issue. 
 
In yesterday's meeting, the members did not discuss such options as 
relaxing the weapons-use rules and expanding the scope of escort to 
include foreign ships in addition to Japanese-registered -- matters 
discussed in the ruling bloc. The reason is because the DPJ still 
thinks the explanation of the dispatch of the MSDF was insufficient, 
while the ruling camp has already endorsed the MSDF dispatch under 
the SDF Law. 
 
6) DPJ has eased its tough stance and has become flexible in Diet 
tactics, reflecting the Nishimatsu scandal 
 
TOKYO SHIMBUN (Page 2) (Excerpt) 
March 19, 2009 
 
There has been a change in the pattern of maneuvering between the 
ruling and opposition camps in the Diet. The Democratic Party of 
Japan (DPJ), with the arrest of the policy secretary of President 
 
TOKYO 00000605  006 OF 010 
 
SUBJECT: JAPANESE MORNING PRESS HIGHLIGHTS 03//09 
 
Ichiro Ozawa for taking large amounts of donations from Nishimatsu 
Construction Co., has been hit with a mood of depression that has 
muted its usual confrontational stance in the Diet. In addition, the 
united front among the opposition parties that had consolidated 
their resolve to fight in the next Lower House election has started 
to crumble, as can be easily perceived in their handling of Diet 
affairs. 
 
7) Ozawa's election strategy goes awry 
 
MAINICHI (Page 2) (Full) 
March 19, 2009 
 
Democratic Party of Japan (DPJ) President Ichiro Ozawa's first 
state-funded secretary has been arrested on suspicion of the 
Political Funds Control Law. The secretary's arrest is upsetting 
Ozawa's strategy of winning the next House of Representatives 
election by building on the momentum from victories in major local 
elections. Ozawa yesterday accepted the request from officials 
connected with the gubernatorial election of Akita Prefecture that 
the opposition forces should be allowed to enter the election 
effectively divided. The official campaign for the Akita 
gubernatorial election on April 12 will kick off March 26. Concerned 
about any negative impact from his secretary's arrest, Ozawa has not 
visited Chiba Prefecture, which will hold its gubernatorial election 
on March 29. 
 
"The DPJ Akita chapter has left the cooperation table of the 
coalition of (the DPJ, Social Democratic Party and People's New 
Party)." With this remark, officials from Rengo (Japanese Trade 
Union Confederation) Akita and the SDP, who called yesterday on 
Ozawa at DPJ headquarters, expressed their displeasure. Ozawa just 
listened to them for about 40 minutes, skipping lunch. Two 
candidates are running in the Akita race: one candidate backed by 
the DPJ Akita chapter and part of the assembly members belonging to 
the ruling Liberal Democratic Party (LDP) and the other supported by 
the DPJ and SDP Akita chapters. After the meeting, Ozawa told 
reporters: "DPJ headquarters has received no word from the 
prefectural chapter. I presume that they will fight the election on 
their own judgment." He then stressed: "We have agreed that we will 
maintain cooperation among the opposition parties in fighting the 
next general election with an eye on a change in government." 
 
When the Yamagata gubernatorial election was held in January, Ozawa 
entered Yamagata immediately before the election day to support the 
candidate backed by opposition parties. The candidate defeated the 
rival backed by the ruling camp. Secretary General Yukio Hatoyama 
commented: "This is an expression (by the voters) that they wanted 
to change the government." However, such a situation will unlikely 
to occur in the Chiba and Akita gubernatorial elections. Ozawa told 
Hatoyama on the 17th: "I asked (New Party Nippon leader) Yasuo 
Tanaka (Upper House member) to go to Chiba to support the campaign. 
I also want you to go there, since voters would listen to you." He 
said to a lawmaker: "We must win at any cost. But I can't go there 
now." 
 
There is a view in the DPJ that if its candidates (in those 
elections) are defeated, Ozawa should resign as the party president. 
Ozawa strongly wants to win, but he has to give consideration to any 
negative impact that might occur due to the donation scandal. 
 
8) Nishimatsu Construction donations: 20 subcontractors in Tohoku 
 
TOKYO 00000605  007 OF 010 
 
SUBJECT: JAPANESE MORNING PRESS HIGHLIGHTS 03//09 
 
region cooperated; Bills sent from Ozawa side 
 
MAINICHI (Page 29) (Full) 
March 19, 2009 
 
Concerning the allegation that Nishimatsu Construction Co., a 
second-tier general construction contractor, made indirect donations 
to the Democratic Party of Japan (DPJ) President Ichiro Ozawa side 
through its subcontractors, Mainichi Shimbun has learned that at 
least 20 subcontractors in the Tohoku region had cooperated in 
making such donations. They formed a voluntary organization called 
Showa-Kai for that purpose. Nishimatsu compensated their payments, 
by including those amounts in its payments to them for subcontracted 
building construction works. It appears that the Tokyo Public 
Prosecutors Office special investigation squad is continuing its 
investigation, suspecting that Nishimatsu made contributions to the 
Ozawa side, using one route through dummy organizations and another 
route using subsidiaries and subcontractors. 
 
According to a source connected with Nishimatsu, Showa-Kai was set 
up by about 20 subcontractors in the Tohoku region more than 10 
years ago. An incumbent executive of the Tohoku branch of Nishimatsu 
Construction served as executive director of the organization and 
called for cooperation in support of Ozawa. According to a Showa-Kai 
member, since then the LDP's branch division in Iwate Constituency 
No. 4 started sending a bill for 500,000 yen to the organization 
annually. 
 
Subcontractors that donated funds to the branch division received 
compensations from Nishimatsu in the form of those amounts included 
in its payments for subcontracted works. One member said, "If you 
say that this is a roundabout donation, it may be so. We just did as 
our parent company asked us to do." 
 
Nishimatsu has donated approximately 25 million yen a year to the 
Ozawa side from more than 10 years ago. The investigation squad 
suspects that Nishimatsu had donated approximately 15 million yen to 
that branch and Rikuzan-kai through Mirai Sangyo Kenkyu-Kai (Future 
Industry Study Group) and Shin-Seiji Mondai Kenkyu-Ka (New Political 
Issue Study Group) and approximately 10 million yen to the branch 
division through contractors and subsidiaries. Showa-Kai is 
estimated to have been involved in the greater part of the donations 
made through the latter route. 
 
9) Ozawa orders consideration of whether to completely ban donations 
from corporations and organizations 
 
NIKKEI (Page 2) (Full) 
March 19, 2009 
 
Democratic Party of Japan (DPJ) President Ichiro Ozawa met yesterday 
with Secretary General Yukio Hatoyama at party headquarters. In the 
wake of the alleged illegal donation scandal involving Nishimatsu 
Construction Co., Ozawa instructed Hatoyama to discuss a review of 
the Political Funds Control Law, including a complete ban on the 
donations from corporations and organizations. The DPJ intends to 
submit a bill amending the law to the current Diet session at the 
earliest, after discussing the issue at its political reform 
promotion taskforce (headed by Katsuya Okada). 
 
Ozawa expressed his willingness to completely prohibit the donations 
from corporations and organizations. He then pointed out: "We should 
 
TOKYO 00000605  008 OF 010 
 
SUBJECT: JAPANESE MORNING PRESS HIGHLIGHTS 03//09 
 
make a clear change and do it quickly." After that, he told 
reporters at party headquarters: "A complete ban is the only 
effective method. If we don't do it drastically, our efforts will be 
meaningless." As to whether a manifesto (set of campaign pledges) 
for the next House of Representatives election will stipulate a 
complete ban on such donations, he said: "I would not mind doing so, 
if everyone agrees." 
 
Ozawa's remarks on the complete ban on donations from corporations 
and organizations created a stir yesterday in the government and 
ruling parties. Prime Minister Taro Aso told reporters: "I don't 
think we should take a view that corporate donations are bad. The 
present system has existed after we had discussed for a long time on 
the way of donations." LDP Diet Affairs Committee Chairman Tadamori 
Oshima also told reporters: "The donation system has been made much 
more open." 
 
New Komeito Secretary General Kazuo Kitagawa took a positive stance 
toward the complete ban on corporate donations. He told reporters: 
"More restrictions are needed for donations from corporations and 
organizations." 
 
10) Is LDP's Hatoyama trying to form a new group? 
 
SANKEI (Page 2) (Full) 
March 19, 2009 
 
Internal Affairs and Communications Minister Kunio Hatoyama, a 
member of the Tsushima faction in the ruling Liberal Democratic 
Party (LDP), is considering forming a group along with five 
lawmakers belonging to the Tsushima faction, it was leaned 
yesterday. Hatoyama had initially decided to hold an inaugural 
meeting of the group at noon today, when the Tsushima faction holds 
a regular meeting, but he has cancelled the planned meeting, since 
the rumor spread faster than expected. 
 
According to all those involved, the five lawmakers include Takamori 
Yoshikawa, Tatsuharu Mawatari and Toru Toida. Hatoyama and the five 
Lower House members reportedly agreed to hold a regular meeting 
every Thursday the same time when the Tsushima faction's regular 
meeting starts. 
 
The six members had planned to celebrate the formation of the group 
at Hatoyama's private office in Tokyo, while having lunch together. 
A senior Tsushima faction member criticized the six, arguing: 
"Skipping the faction's meetings is equivalent to withdrawal from 
the faction." 
 
The Tsushima faction lacks unity, as there are such groups as one 
led by Mikio Aoki, former chairman of the LDP caucus in the House of 
Councillors, and another one which supported Agriculture Minister 
Shigeru Ishiba in last years' LDP presidential election. Hatoyama's 
aide said: "Hatoyama does not have any intention to succeed Prime 
Minister Taro Aso. So, he called off the meeting planned for the 
19th." However, the dominant view in the Tsushima faction is that 
Hatoyama is eyeing running in the presidential race. 
 
11) CO2 emissions credits: Government to purchase 30 million tons 
from Ukraine 
 
ASAHI (Page 1) (Full) 
March 19, 2009 
 
TOKYO 00000605  009 OF 010 
 
SUBJECT: JAPANESE MORNING PRESS HIGHLIGHTS 03//09 
 
 
The government on March 18 announced that it signed a contract to 
purchase greenhouse gas emissions credits for 30 million tons from 
the Ukraine government. In order to achieve its goal of cutting 
carbon emissions as set under the Kyoto Protocol, the government 
plans to purchase emissions credits for roughly 100 million tons by 
fiscal 2012. The government has now achieved 30 PERCENT  of its 
plan. 
 
The government did not reveal the value of the purchases so as to 
avoid a possible impact on negotiations with other countries. The 
market prices of emissions credits for 30 million tons are between 
45-50 billion yen. The value of the purchase this time estimated to 
be lower than that level. Since the price of emissions credits have 
fallen to one-third of the level last summer due to the financial 
crisis, the government has judged that the timing is right for such 
purchases. The cost for the purchase will be used for measures to 
address global warming in Ukraine. 
 
Japan is obligated to cut greenhouse gas emissions by 6 PERCENT  in 
comparison with the 1990 level. The government plans to cover 1.6 
PERCENT  or roughly 100 million tons through the purchases of 
emissions credits. It had already obtained emissions credits for 
about 23 million ton through the Clean Development Mechanisms (CDM), 
under which industrialized countries that use their own technologies 
and funds for projects based in developing countries to cut 
greenhouse gas emissions can offset the cuts against the output of 
their own country. It has achieved half of its target of obtaining 
emissions credits, if the amount purchased from Ukraine is 
included. 
 
The government has signed a memorandum for purchases of carbon 
dioxide emissions credits with Poland, the Czech Republic and 
Hungary. It will continue negotiations with them for such 
purchases. 
 
12) Administrative surcharges totaling 9 billion yen imposed on 12 
freight companies for cartel on international freight transport 
 
SANKEI (Page 1) (Full) 
March 19, 2009 
 
Recognizing 14 major transport companies, such as Nippon Express, as 
having formed a price cartel over charges for international aircargo 
transport, the Fair Trade Commission (FTC) has issued an order to 
end the unfair trade practices to 12 companies with the aim of 
preventing a recurrence. It has sent orders to them to pay 
administrative surcharges totaling approximately 9.053 billion yen. 
 
The FTC has also issued an order to prevent a recurrence to the 
Japan Aircargo Forwarders Association (JAF), a venue where the 14 
companies conferred on the cartel. DHL Global Forwarding Japan 
affiliated with a German postal services company was exempted from 
those orders, as it voluntarily submitted information on its illegal 
trade practices before coming under scrutiny. The remaining one 
company had already closed business. 
 
According to the FTC, those companies in question had made an 
arrangement between September 2002 and November 2007 to shift full 
fuel surcharges they were supposed to pay to airline companies onto 
consigners. 
 
 
TOKYO 00000605  010 OF 010 
 
SUBJECT: JAPANESE MORNING PRESS HIGHLIGHTS 03//09 
 
Specifics of the cartel were decided at an executive meeting of the 
JAFA International Department, attended by former Transport Ministry 
official-turned executives. In November 2007, when there was a press 
report on the launch of an investigation by U.S. anti-trust 
officials, they decided not to hold an executive meeting at Nippon 
Express. The cartel was then dissolved. 
 
European and U.S. anti-monopoly officials order airline companies 
also pay fines for forming such a cartel. In Japan, however, 
international air fares are exempt from the application of the 
Anti-Monopoly Law. 
 
The volume of international aircargo transport for exports in 2007 
reached about 1.15 million tons. Nippon Express', Yusen Air's and 
Sea Service's (Tokyo) and Kintetsu Express' (Tokyo) share of such 
transport accounts for nearly 50 PERCENT . 
 
Main companies that received an order to pay administrative 
surcharges and the amounts of such charges are as follows: 2.49503 
billion yen on Nippon Express; 1.72828 billion yen on Yusen Air and 
Sea Service; 1.49461 billion yen on Kintetsu Express; and 851.96 
million yen on Nishi Nippon Railroad Co. 
 
ZUMWALT