RetireJapan

So, many of us here have been using Interactive Brokers to have access to the US stock market. IB in Japan offered two separate accounts: IBLLC to invest abroad (which I did to get some Vanguard ETFs from the US) and IBSJ to buy Japanese domestic stocks (not for me as an American.) Lo and behold, IBLLC clients have received an email saying that from April, all IBLLC clients in Japan will have to choose whether to have their account changed to an IBSJ account (which claims to be changing to allow foreign stock purchasing, sort of a merging of the two types) or transfer your positions to a non-IB broker (if you can find one to service expats...)

I was going to post the whole email here, but I will hold off for now and am just curious on others ' thoughts. I know a lot of people here use IB for US market access. I wonder if my Vanguard ETFs will still be OK, or only access to ETFs available to the Japan market. Lots of thoughts, with more info supposedly coming from IB.

https://ibkr.info/node/4739

Current Panicked Discussion Thread - https://www.reddit.com/r/JapanFinance/c ... ved_email/

Clarification is needed, but Americans may have to close out all PFIC positions. None of this is legally enforced, but the tax reporting implications would be huge.

They also say they will ONLY be supporting yen initially, Americans may need to close USD positions.

Read through that email very carefully everyone, I think it spells out a huge issue for Americans .

Note To Americans: I'm sorry. This really sucks.

Thanks for the link. So the VTI, VXUS, etc. I bought in USD and hold through IBLLC here wouldn't be able to be transferred to the new IBSJ account?? Or do you mean cash dollars held in the account and not US ETFs, etc. bought in USD? (Sorry, amateur here.)

FlamingWombat wrote: ↑Tue Jan 24, 2023 1:32 am Thanks for the link. So the VTI, VXUS, etc. I bought in USD and hold through IBLLC here wouldn't be able to be transferred to the new IBSJ account?? Or do you mean cash dollars held in the account and not US ETFs, etc. bought in USD? (Sorry, amateur here.)

It's not at all clear from the FAQ what the implications are.

My take so far, absent a clearer explanation and some examples, is that the fact that they are being so cagey is a very bad sign for their customers.

RetireJapan wrote: ↑Tue Jan 24, 2023 1:40 am

FlamingWombat wrote: ↑Tue Jan 24, 2023 1:32 am Thanks for the link. So the VTI, VXUS, etc. I bought in USD and hold through IBLLC here wouldn't be able to be transferred to the new IBSJ account?? Or do you mean cash dollars held in the account and not US ETFs, etc. bought in USD? (Sorry, amateur here.)

It's not at all clear from the FAQ what the implications are.

My take so far, absent a clearer explanation and some examples, is that the fact that they are being so cagey is a very bad sign for their customers.

Contact their support team. It seems likey you will need to close out USD positions.

I haven't got the email yet, nor a notification on login. I guess they're sending them in batches? Some details: IB LLC account since 2008; no IBSJ account; British citizen; registered address is in Japan.

This will probably be fairly painful for me as I hold Ireland- and US-domiciled ETFs, and cash in GBP, USD, JPY, EUR and AUD. It looks like the cash will be converted to JPY, unless I transfer it to my Shinsei foreign currency accounts before then. Not sure what will happen to the ETFs - their base currencies are GBP, USD and EUR.

Waiting apprehensively...

Same here, no email or notification yet...

There is no way this is selective though. They may just want to avoid flooding their support.

I have a margin account. There is speculation on the reddit thread that they are doing the cash accounts first. Maybe that's the reason?

No email or message from IB yet.

I contacted IB today to confirm things. They said the shift to the new Japanese broker IBSJ will apply to all J-resident account holders, even those of us who have not received any message yet.

I think the Jp financial agency realized that IB is becoming popular in Japan, offering much more than the Japanese brokers (the Japanese brokers may have complained about IB). So IB was told to obey all the Japan rules if they wish to remain in Japan, and IB complied.

Therefore I dont think we can expect that IB will be allowed to offer much different from the usual Japanese brokers. There should be no problem if you dont mind your investments all converted to yen, and you only invest in things already available in Jp brokers.

However, if have some non-standard investments, or you want to stay in USD, then you're screwed. (I'm thinking of moving to Firstrade or Swissquote).