Japan Plans an Exam and a Public Register for SME M&A Advisers. What It Means for Buyers

Most small Japanese companies that sell to an outside buyer do so through a broker (仲介) or a financial adviser (FA). Japan has no national qualification for this work. That is about to change. Japan's SME Agency is building a qualification for the people who do this work: a national exam, a public register of those who pass, and removal for those who break the rules. A June 2026 government strategy, quoted in the SME Agency's July paper for its market reform panel, says the aim is to put it into law. For a foreign buyer, this is the next step in a steady trend: Japan's sell side is getting more regulated, and the checks increasingly point at buyers too.

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Why Japan is doing this. In August 2021 the SME Agency opened a registration system for M&A support firms (M&A支援機関登録制度). Firms that join declare that they follow the government's SME M&A Guideline, and the government's subsidy for adviser fees covers only registered brokers and FAs. By March 2026 about 3,400 firms had registered, including about 1,200 specialist brokers and FAs, according to the SME Agency's March paper. The system has a desk where business owners can report problems. Firms that break the rules can be warned or removed under a procedure published in May 2023. The reports keep coming, though, including about registered firms. The SME Agency says complaints about sales tactics are only part of the picture: reports about how deals are actually run, which tend to cause more serious trouble, are not falling.

The examples it lists will sound familiar to anyone who has hired a Japanese adviser:

• Contracts signed before the explanation. A firm signed an advisory contract with an exclusivity clause and an early-termination penalty without first giving the explanation of key terms the guideline requires.
• Tail fees without exclusivity. A firm the owner did not choose claimed a fee under a tail clause, though the contract had no exclusivity clause.
• Fees kept after the value fell. A firm took an interim fee based on an early price estimate and did not refund it when the company was later valued lower.

What is planned. The SME Agency's July paper quotes the June 2026 strategy for small and mid-sized companies, which sets out two steps. The same paper sketches how the qualification would work:

• A qualification for individuals. A provisionally named "SME M&A support qualification" (中小M&A支援資格制度): an exam on M&A practice, finance and tax, law, and ethics, plus a register of people who pass. Registration would require a pledge and a course, with refresher courses on renewal.
• Public, and with consequences. Information on registrants would be published in an online system. Those who break the ethics rules could have their names published and their registration cancelled.
• Tougher rules for firms. A review of the firm registration system, linked to the new qualification, with the aim of putting both into law.

The strategy says the government aims to create the qualification "as soon as possible". No bill had been published by 24 October.

When the first exam is. The SME Agency's tender for running the exam, issued on 27 March, says the first one is in fiscal 2026 (to March 2027). It describes a computer-based test at centres nationwide, 120 minutes, four subjects and up to about 60 questions. If the test is held on fixed dates, the tender proposes three days in January–February, two weekdays and one weekend or holiday, with each candidate sitting once. Details are still to be agreed with the SME Agency, and we found no published dates as of 24 October. It plans for about 10,000 candidates, based on the number of full-time M&A support staff at registered firms.

Those staff are concentrated in Tokyo. Of 10,616 at the end of February 2026, 6,497 were in Tokyo. Osaka had 859, Kyoto 152 and Hyogo 140, and the six Kansai prefectures together had 1,208 (our sum of the tender's figures).

What sellers pay. At the same March meeting, the SME Agency gave a first look at the fees reported by registered firms. Fees on small deals are high as a share of the price, because minimum fees kick in.

Location matters a little. For deals priced between ¥10 million and ¥50 million, the median fee rate was 20.0% in greater Tokyo (Tokyo, Kanagawa, Chiba and Saitama) and 27.1% elsewhere, which includes Kansai. The SME Agency says the gap is not large. On a small deal, a fee that size shapes what price the owner will accept.

Why buyers are in the frame too. Part of the push comes from bad buyers. The SME Agency's exam tender notes press reports of inappropriate buyers not being kept out, for example where the seller's personal guarantees were never released. Its public warning from August 2024 describes a buyer that took the target's cash, sent no money to run the business and left the former owner, still the guarantor, personally bankrupt. The third edition of the SME M&A Guideline, from the same month, asks brokers, FAs and M&A platforms to investigate the buying side and report the results to their client. It also asks advisers to help settle what happens to the owner's personal guarantees in the final agreement.

What it means for a foreign buyer. We read it four ways:

1. Expect to be checked. A careful adviser will ask who you are, where the money comes from, what you plan for the staff, and how you will release or replace the owner's personal guarantees. Have clear answers ready, in Japanese if you can. Our complete guide covers the groundwork.
2. Check the adviser too. Ask whether the firm is on the M&A support institution register. The register's database already publishes registered firms' services, fee structures and track records. Once the qualification starts, you can also ask whether the person handling the deal has passed the exam.
3. Read the fee terms on small deals. Minimum fees make advisers expensive on small companies, and fees on your side are a separate matter. Read exclusivity, tail and interim-fee clauses before you sign, the same clauses that fill the complaints desk.
4. Do not expect a fast change. The first exam is provisionally planned for early 2027, and legislation has no published timetable. For now, the register and the guideline are the tools.

A cleaner, more transparent adviser market should help serious buyers, because the advisers who stay are the ones who need to show their buyers are sound. Being known to those advisers, with a clear profile, is one way to get there.

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