Announcement of Approval for Japan's First Public Interest Trust Enabling Donor-Advised Funds Utilizing Trusts

Hogaraka Trust Co., Ltd. (Chairman and CEO Masao Nakamura, President and CEO Mitsuru Takaku, hereinafter "Hogaraka Trust") and Commons Japan Co., Ltd. (President and CEO Kimihiko Mizutani, hereinafter "Commons Japan") announce that they have received approval from the Cabinet Office on June 29, 2026, for a regional co-creation public interest trust "Children's Future and Education Support" aimed at educational support, with Aqua Co., Ltd. (Chairman Nami Tokunaga, President Yasumasa Tokunaga, hereinafter "Aqua") as the trustor.

This approval marks the first "General" public interest trust to be newly approved after the revised Public Interest Trust Act came into effect, and it is the first scheme in Japan to utilize trusts, enabling trustors and donors to shape the purpose of the public interest trust, the fields for fund utilization, and other intentions and wishes entrusted to the trustee.

1. What is the Regional Co-creation "Children's Future and Education Support" Public Interest Trust?

(1) Overview

This trust is a public interest trust established with Aqua as the trustor. Its purpose is to contribute to the development of human resources who will lead Japan's future by providing grants for projects that promote education and secure learning opportunities in Japan, as well as for research in the field of education.

This trust is undertaken by Aqua as part of its social contribution activities, driven by the desire to return the results of its business growth to regional educational activities. This trust is a scheme that accepts donations from companies and individuals other than Aqua, and it contributes to educational support activities nationwide.

(2) Grant Programs

Grants will be provided for the following programs utilizing the public interest trust. The first grant implementation is scheduled for January-March 2027, following public solicitation and screening.

Educational activities conducted by kindergartens, elementary schools, junior high schools, integrated junior high and high schools, high schools, secondary schools, and special needs schools as defined in Article 1 of the School Education Act, or their operators (boards of education, school corporations, etc.).

Educational or research activities conducted by universities or colleges of technology as defined in Article 1 of the School Education Act.

Projects that support education, promote research in the field of education, or secure learning opportunities, conducted by non-profit corporations, organizations, or individual researchers.

(3) Trust Management

This is a joint trust management by Hogaraka Trust and Commons Japan. Hogaraka Trust will primarily be responsible for the acceptance and management of trust assets. Commons Japan will primarily be responsible for the public solicitation and screening of grant applicants, the operation of the steering committee, grant implementation, and monitoring/impact evaluation.

Scheme Diagram of this Public Interest Trust

(4) Initial Trust Amount

The initial trust amount entrusted by Aqua is 5 million yen. The company plans to make additional trust contributions or donations to this public interest trust over the medium to long term. Furthermore, donations from corporations and individuals nationwide involved in educational support will be accepted, with the aim of reaching a trust asset size of approximately 10 billion yen.

(5) Features

This trust is the first public interest trust in Japan to adopt a Donor-Advised Fund (DAF) scheme, which allows the trustor to shape their intentions and wishes regarding the purpose of the public interest trust, the fields for fund utilization, and other aspects entrusted to the trustee. It also features the management of public interest trust assets through investment trusts, etc.

Based on the intentions and wishes of the trustor and donors, "grant slots" will be established for each target region and grant field, and management and grants will be implemented separately for each "grant slot."

Trust assets entrusted or donated will be managed through investment trusts, etc.

Due to the tax system reform for Reiwa 6 (2024), public interest trust approval and tax incentives have been linked, and all approved public interest trusts will receive tax benefits similar to public interest corporations, such as donation deductions for property contributors and separate loss carryforwards for corporate taxes.

In this public interest trust, collaboration with individuals in the social sector, such as philanthropy advisors, is planned for approaching donors and providing follow-up after grant implementation.

2. Future Actions

Hogaraka Trust and Commons Japan will work to establish a virtuous cycle of social and economic value for solving social issues in close cooperation with non-profit sectors such as certified non-profit NPOs and public interest foundations. Public interest trusts play a role in connecting private funds to social issues in supporting educational activities through public-private partnership, and are viewed as a means of linking the power of trusts to the improvement of societal sustainability.

With the recent legal reform, public interest trusts have improved flexibility and allow for the participation of diverse entities in public interest activities. We will strive to improve product quality and actively engage in information dissemination to contribute to the spread of the system.

<Reference>

Donor-Advised Funds (DAFs) in the United States are a scheme originating in the U.S. and a popular donation method there. In 2024, the total asset balance of Donor-Advised Funds (DAFs) in the U.S. reached approximately $327.8 billion (approximately 53 trillion yen).

<Inquiries Regarding This Matter>

Hogaraka Trust Co., Ltd.

Kojimachi Crystal City 9F, 4-8 Kojimachi, Chiyoda-ku, Tokyo

Contact: Arao, Komatsubara

e-mail m.arao@hogaraka-trust.co.jp

h.komatsubara@hogaraka-trust.co.jp

TEL 03-3511-5695

Commons Japan Co., Ltd.

Urbanet Nihonbashi 2-chome Building 10F, 2-1-3 Nihonbashi, Chuo-ku, Tokyo

Contact: Mizutani

e-mail kimihiko.mizutani@commonsjapan.com

TEL 050-5358-4498

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