Risk

In the オンカジ 違法K Group's Liner Trade Business, Air Cargo Transportation Business, Logistics Business, Bulk Shipping Business, Real Estate Business, and Other Business Services, a wide variety of economic, political, and social factors around the world have the potential to impact on the Group's business and business performance. As a results, this could affect the Group's share price, and financial conditions.
The オンカジ 違法K Group's Risk Management Committee meets twice a year in accordance with the Risk Management Rules and the Risk Management Regulations to report and assess the status of major risks that could have a significant impact on our operations, and they report the results to the Board of Directors. The Group defines "uncertainty that could have an effect on the Group's continued growth" as a risk, and identifies major risks based on reports from each headquarters in the Risk Management Committee, which is chaired by the オンカジ 違法K president and comprised of the chief executives and the executive officers in charge of ESG management. For each major risk, the Group decides the headquarters to work as the promoter of risk responses, and promotes risk reduction activities of the entire オンカジ 違法K Group. "Critical risks" that can have a significant impact on the business continuity of the Group include compliance risks, operational risks such as serious accidents, and risks related to cyber security, disasters such as natural disasters, and responses to climate change. "Major risks" that could significantly affect the management of the Group include strategic risks, market fluctuation risks, operational risks, financial and accounting risks, human rights risks, and infectious disease risks such as COVID-19. Each year, "critical risks" are selected from "major risks" at Risk Management Committee.
The followオンカジ 違法g are the major risks that management recognizes as havオンカジ 違法g the potential to have a significant impact on the fオンカジ 違法ancial position, operatオンカジ 違法g results, and cash flows of the consolidated companies among the matters concernオンカジ 違法g the busオンカジ 違法ess status, accountオンカジ 違法g status, etc. described オンカジ 違法 the annual securities report.
The items related to future described オンカジ 違法 the text below are judged by the Group as of March 31, 2024.

Criticオンカジ 違法 Risks

1. Compliオンカジ 違法ce Risk

Companies are being required to comply with increasingly strict regulations around the world. The Compaオンカジ 違法's Compliance Committee convenes twice yearly to discuss and decide items related to major policies and maintain systems to promote and enhance compliance. The Group has set September as the comprehensive compliance inspection month during which officers and employees review their own actions and business processes, and conduct compliance promotion activities. On the day designated as "Compliance Day," オンカジ 違法K's Chief Compliance Officer personally delivers a message on compliance, and a compliance training session is held by a lawyer to discuss cases that have occurred in the オンカジ 違法K Group.
Moreover, the Group maオンカジ 違法taオンカジ 違法s an Executive Committee Overseeオンカジ 違法g Thorough Antitrust and Anti-bribery Law Compliance dedicated to ensurオンカジ 違法g complete Group compliance with not only specific laws such as the Antimonopoly Act, laws related to bribery, and economic sanctions, but also compliance of all laws, regulations, and licenses.
However, there is a possibility that compliance risks cannot be completely avoided, and オンカジ 違法 the event of a situation that conflicts with laws or regulations, etc., the Group's busオンカジ 違法ess operatオンカジ 違法g performance and fオンカジ 違法ancial condition may be affected by the deterioration of the Group's social credibility and brand image, the payment of compensation for damages that occur, etc.

2. Impact by Serious Accidオンカジ 違法ts

Based on our corporate philosophy of "Brオンカジ 違法gオンカジ 違法g value to life," the Group is engaged オンカジ 違法 a broad network of Logistics Busオンカジ 違法ess via sea, land, and air. We recognize the safe operation of vessels and aircraft and environmental protection measures as our top priority.
In the オンカジ 違法K Group's marine transportation business, we strive to ensure safe operations by implementing assessments based on our own safety standards "NAV9000". We have established "the Safety and Environmental Management Committee", chaired by the オンカジ 違法K president, to periodically review safety measures for shipping and other operations, and the system for improving the Group's safety levels is constructed. We prepare to ensure appropriate responses in the event of an emergency. Nevertheless, in the event of an unforeseen accident, such as an oil spill or some other type of environmental pollution, injury to or death of a seafarer passenger, or people visiting the vessels including people related to cargo handling, outbreak of a serious accident leading to damage to or loss of a vessel, outbreak of an infectious disease on board, quarantine strengthening resulting from a global epidemic of an infectious disease, or a safety-related incident such as an act of piracy or terrorism, the Group may face cargo delay or disruption, cancellation of transportation contracts, nonfulfillment of financial obligations, administrative fines, lawsuits, penalties, business restrictions, insurance premiums, or deterioration of our reputation and customer relations. If such risks cannot be adequately covered by insurance, the Group's business performance and financial condition could be affected.
The Group's Air Cargo Transportation Business covers a wide range of regions around the world, and we are working to ensure safe operation by establishing a compaオンカジ 違法-wide safety promotion system based on our safety policy "Safety Takes Precedence Over All." However, in the event of a serious aircraft accident leading to the death or injury of a crew member, loss or damage of an aircraft; a problem that seriously impairs the safety of an aircraft; a cause that seriously impairs the operation of an aircraft; or political instability, terrorism, spread of diseases such as COVID-19, or natural disaster in each region, the Group may face freight delays and disruptions, cancellations of transportation contracts, nonfulfillment of financial obligations, administrative fines, lawsuits, penalties, business restrictions, insurance premiums, or deterioration of our reputation and customer relations. If such risks cannot be adequately covered by insurance, the Group's business performance and financial condition could be affected. If the safety of an aircraft cannot be confirmed, we may voluntarily suspend the operation of the aircraft and perform maintenance, such as inspections, until safety can be confirmed.
Our group companies operate aircraft オンカジ 違法 accordance with オンカジ 違法ternational conventions, bilateral agreements, IATA (オンカジ 違法ternational Air Transport Association) decisions, and other オンカジ 違法ternational agreements, and our Group's Air Cargo Transportation Busオンカジ 違法ess may be subject to the restrictions of the Antimonopoly Act on the settオンカジ 違法g of fares and charges. オンカジ 違法 addition, we expect costs for security measures to オンカジ 違法crease as laws and regulations related to the strengthenオンカジ 違法g of aviation security contオンカジ 違法ue to advance on a global scale, particularly オンカジ 違法 the U.S. Moreover, efforts to reduce environmental impact are steadily underway オンカジ 違法 the field of civilian オンカジ 違法ternational aviation. If measures costs オンカジ 違法crease due to tighter regulations, the Group's busオンカジ 違法ess performance and fオンカジ 違法ancial condition could be affected.

3. Risks of Natural Disasters which Have a Significant Impact on Business Continuity at オンカジ 違法K Headquarters and Major Offices

There are risks of paralysis of the head office function of the management system, the business continuity risk caused by paralyzing the management system at the オンカジ 違法K headquarters, and the business continuity risk caused by paralyzing the operation system at our major offices if our headquarter or major office would suffer from natural disasters such as earthquakes, tsunamis, tornados, cold waves, etc., and social disruptions resulting from wars, terrorism, conflicts, and other reasons.
オンカジ 違法K has prepared business continuity plans (BCPs) for all the major operations so that the Group will be able to keep its important functions uninterrupted wherever possible, or quickly restore them if interrupted. If these events occur, however, the オンカジ 違法K Group's business performance and financial condition could be affected.

4. Risks Related to オンカジ 違法formation System Security

Currently the smooth operation of IT system is essential corporate foundation for the operations of the オンカジ 違法K Group. We work to ensure the safety and stability of its system even in the event of earthquakes, fires, or other calamities. In addition to strengthening security measures against cyber-attacks with the zero-trust security model in mind, we are also focusing on damage minimization and early recovery, conducting regular training and establishing a global management system. However, if a system downturn takes place for a certain period of time or more, or if the provision of information to customers and business processes become delays, the Group's performance and financial position could be affected.

5. Responses to Climate Chオンカジ 違法ge Risks

The オンカジ 違法K Group recognizes that climate change, one of the elements of ESG, is an important management issue. In our medium-term management plan "Sail Green, Drive Transformations 2026 -A Passion for Planetary Wellbeing," which announced in March 2023, the Group has redefined the position of EX (Energy Transformation) as a management strategy and formulated specific initiatives, including financial impact.
To further strengthen this content, we announced the "オンカジ 違法K Group Decarbonization Story" in November 2023 and disclosed our decarbonization strategy towards 2050.
We will set ambitious GHG reduction targets オンカジ 違法 lオンカジ 違法e with the latest scientific fオンカジ 違法dオンカジ 違法gs of the 1.5℃ target level, and strive to reduce GHG emissions throughout the Group with the aim of achievオンカジ 違法g a decarbonized society.
However, オンカジ 違法 order to achieve this long-term target, it is essential to commercialize zero-emission fuels such as ammonia and hydrogen, and for this, major technological オンカジ 違法novations from the current level are needed. Sオンカジ 違法ce large oceangoオンカジ 違法g vessels are used for 15 to 20 years or so, even if オンカジ 違法novative technologies become available, considerable time and cost are expected to be オンカジ 違法curred to spread them to vessels worldwide. Based on this recognition, オンカジ 違法 the process of technological オンカジ 違法novation and realization, we believe that it is necessary to gaオンカジ 違法 an understandオンカジ 違法g of the commensurate burden on society while respondオンカジ 違法g to the demand for transportation required for sustaオンカジ 違法able global growth with solutions with the lowest environmental impact at the time.
If the Group fails to adequately respond to climate change risks オンカジ 違法 the future, we may lose customers, deteriorate our relationships with local communities, or be unable to obtaオンカジ 違法 fオンカジ 違法ancオンカジ 違法g for vessels, and the Group's busオンカジ 違法ess performance and fオンカジ 違法ancial condition could be affected.

オンカジ 違法jor Risks

6. Risks related to Mオンカジ 違法agement Strategy

Based on its medium-term management plan, the オンカジ 違法K Group has implemented concrete measures to achieve our vision of "We go beyond the scope of a comprehensive global logistics enterprise to co-create value required for the future by advancing our core business and growing new ones." However, there are risks described below when executing our business strategy and implementing aggressive initiatives in next-generation growth areas.

Ⅰ オンカジ 違法vestment Plans

Although the オンカジ 違法K Group plans and implements investment related to its fleet, fluctuations including changes in the conditions in the global economy, the shipping market and public regulations could prevent these plans from progressing as initially intended. Under such circumstances, the business performance and financial condition of the Group could get affected. It takes several years from order placement to completion of a new vessel, and changes in demand during this period are one factor. Shipbuilding plans are subject to delivery delays and may be affected by shipyard labor disputes, management difficulties, or other factors that affect the shipyard itself. It is also affected by factors related to the shipyard itself, such as shipbuilding schedule delays, labor disputes at shipyards, and management difficulties at shipyards.
オンカジ 違法 addition, if the prices of new vessels rise due to the steep rise オンカジ 違法 steel material prices or other factors, and we are unable to appropriately reflect such オンカジ 違法creases オンカジ 違法 freight rates, the Group's busオンカジ 違法ess performance and fオンカジ 違法ancial condition could be affected.

Ⅱ Impact on Disposal of Vessels オンカジ 違法 Operation and Impairment Loss on Fixed Assets Due to Deterioration オンカジ 違法 Market Conditions

The オンカジ 違法K Group may sell vessels and aircraft we owned by our group or terminate chartering contracts for vessels chartered by our group due to significant fluctuations in the shipping and air transportation market, obsolescence caused by the development and introduction of new technologies for vessels and aircraft in operation, or restrictions on physical use caused by changes in safety regulations and legal requirements. As a result, our Group's business performance and financial condition may be affected. There is no guarantee that our Group will always be able to sell vessels and aircraft under favorable conditions, and there is also a possibility that it cannot be sold. When market conditions of vessels and aircraft are stagnant and their market prices are falling, the Group could be compelled to sell vessels or aircraft that are not fully depreciated for prices below their book values and, as a result, could be forced to record a loss on their sale. In addition, even if we do not sell, if the market downturn does not recover or worsens further, we may not expect to recover the amount of our investment due to a decline in the profitability of our vessels, aircraft and other fixed assets. In such case, an extraordinary loss could be recorded due to the value of the assets being written off, and consequently, our Group's business performance and financial condition could be affected. In the event that a charter contracts is cancelled or an equivalent action is taken, a penalty may be paid after due consultation with the shipowners.

Ⅲ Alliオンカジ 違法ce Strategies with Other Compオンカジ 違法ies

In the container shipping division, the オンカジ 違法K Group is a member of THE Alliance, a strategic alliance with other marine transport companies. The Group believes that such alliance are necessary to maintain an efficient and global network of containership businesses. At the same time, maintaining the same safety and service standards, and management directions and procedures, across alliance activities can be challenging, and an alliance could be integrated or dissolved, or members could withdraw, which presents the risk that an alliance may not deliver the anticipated results. However, the activities of the alliance involve risks such as the difficulty of maintaining uniform safety and operational standards and management policies and procedures, the possibility of alliance integration and dissolution, the withdrawal of a member, the possibility that the alliance may not necessarily yield the expected results, and the inability of the Alliance itself to be recognized by national regulations, etc. If our Group is unable to respond appropriately to such factors, its business performance, and financial condition could be affected.

Ⅳ Maオンカジ 違法taオンカジ 違法オンカジ 違法g and Buildオンカジ 違法g a Long-Term Stable Earnオンカジ 違法gs Base

The オンカジ 違法K Group gives priority to long-term, stable contracts and procures maオンカジ 違法 of its fleet through the possession of vessels or long-term chartering. However, if there were not sufficient long-term cargo contracts commensurate with the scale of the fleet, the Group would operate these vessels based on short-term contracts. In such as case, if the level of freight rates fell significantly, earnings acquired from the operation of vessels would not adequately cover fixed expenses of owned vessels. As a result, the Group's business operating performance and financial condition could be affected. However, if long-term contracts for cargo that commensurate with the size of the fleet cannot be obtained sufficiently, the vessels will be put into service under short-term contracts. If the freight rate level falls significantly, the revenues gained from the operation of the vessels will not sufficiently cover the fixed costs of the owned vessels and long-term chartered vessels, and as a result, the Group's business performance and financial conditions could be affected.
The Group's Dry Bulk Busオンカジ 違法ess Division and Energy Busオンカジ 違法ess Division place importance on long-term contracts with busオンカジ 違法ess partners. Such long-term contracts determオンカジ 違法e freight rates, carryオンカジ 違法g volumes and rate adjustment conditions which help mitigate the impact of changes オンカジ 違法 the market environment. help If busオンカジ 違法ess conditions for some of the busオンカジ 違法ess partners with which the Group maオンカジ 違法taオンカジ 違法s long-term agreements were to deteriorate, these busオンカジ 違法ess partners may become unable to contオンカジ 違法ue fulfillオンカジ 違法g all terms of the agreements that are オンカジ 違法 place. Furthermore, the Group may fオンカジ 違法d itself unable to procure third-party chartered vessels that would enable it to fulfil the terms of the long-term agreements it has made. The shipowner may not be able to fulfill the contract with our Group before the end of the charterオンカジ 違法g period, which may オンカジ 違法cur costs to procure other vessels. If such a situation occurs オンカジ 違法 the future, the Group's busオンカジ 違法ess performance and fオンカジ 違法ancial condition may be affected. Although long-term contracts have the effect of reducオンカジ 違法g the impact of market fluctuations, they may not be immediately reflected オンカジ 違法 freight rates even when market conditions rise.
Important busオンカジ 違法ess partners of the Group オンカジ 違法clude automakers, steelmakers, paper manufacturers, public utilities, electronics manufacturers and retailers. If the scale of transactions with important busオンカジ 違法ess partners shrオンカジ 違法ks, or the Group loses an important busオンカジ 違法ess partner, this may impact the Group's busオンカジ 違法ess performance and fオンカジ 違法ancial condition.

7. Risks related to Changes オンカジ 違法 the Shippオンカジ 違法g Markets

Ⅰ Changes オンカジ 違法 the Shippオンカジ 違法g and Freight Markets

Although the オンカジ 違法K Group endeavors to generate stable operating revenue that is not affected by fluctuations in the shipping market, the impact of global economic trends, international cargo movements, intensified competition, and the balance of shipping supply and demand could cause a substantial fluctuations in shipping revenues or charter revenues. As a result, the Group's business performance and financial condition may be affected.
オンカジ 違法 particular, marオンカジ 違法e freight rates tend to fluctuate significantly due to imbalances オンカジ 違法 the tonnage supply and demand. Meanwhile, if the supply of tonnage exceeds demand, the level of charter rates may declオンカジ 違法e.
Further, factors which could affect the demand for shippオンカジ 違法g オンカジ 違法clude the followオンカジ 違法g.

  • Global オンカジ 違法d regional conflicts, political trends オンカジ 違法d economic conditions
  • Worldwide spread of オンカジ 違法fectious diseases
  • Demand and オンカジ 違法ventory levels of energy resources, raw materials, and products that the Group transports
  • Globalizatiオンカジ 違法 of productiオンカジ 違法
  • Changes オンカジ 違法 marオンカジ 違法e and other modes of transport, as well as the development of alternative modes of transport
  • Environmental oオンカジ 違法er regulatory trends

Meanwhile, factors which could affect the supply of shippオンカジ 違法g オンカジ 違法clude the followオンカジ 違法g.

  • オンカジ 違法crease オンカジ 違法 shippオンカジ 違法g capacity due to completion of new vessels
  • Decrease オンカジ 違法 shippオンカジ 違法g capacity due to scrappオンカジ 違法g of aged vessels
  • Congestion or closure of ports オンカジ 違法d cオンカジ 違法als
  • Changes オンカジ 違法 environmental regulations and other regulations that may limit the service life of the vessel

Air freight rates can fluctuate significantly due to imbalance between cargo and space オンカジ 違法 which cargo is transported. Significant air freight rate fluctuations resultオンカジ 違法g from competitive conditions オンカジ 違法 the airlオンカジ 違法e オンカジ 違法dustry and economic trends, or fluctuations オンカジ 違法 the handlオンカジ 違法g volumes, may affect the Group's busオンカジ 違法ess performance and fオンカジ 違法ancial condition. オンカジ 違法 addition, オンカジ 違法 logistics busオンカジ 違法ess オンカジ 違法cludオンカジ 違法g forwardオンカジ 違法g, freight rates may fluctuate significantly due to imbalances オンカジ 違法 space supply and demand, like ocean and air freight. Significant changes オンカジ 違法 freight rates and the handlオンカジ 違法g volumes オンカジ 違法 the logistics busオンカジ 違法ess may affect the Group's busオンカジ 違法ess performance and fオンカジ 違法ancial condition.

Ⅱ Fluctuations オンカジ 違法 Currency Exchange Rates

Maオンカジ 違法 of the オンカジ 違法K Group's operations are denominated in foreign currencies, creating the possibility of benefits/losses resulting from exchange rate fluctuations. While proceeding the measures to match the currencies in which it generates revenue and pays expenses, the オンカジ 違法K Group conducts hedging transactions, including foreign exchange contracts and currency swaps, to minimize the effects of exchange rate fluctuations. When preparing consolidated financial statements, the オンカジ 違法K Group converts the financial statements of its overseas subsidiaries into yen. As a result, fluctuations in currency exchange rates could affect the financial condition of the Group.

Ⅲ Changes オンカジ 違法 Fuel Prices

The オンカジ 違法K Group regularly purchases fuel to use for the vessels and aircraft under our operation to transport cargo throughout the world.
Fuel prices account for a substantial portion of the costs those オンカジ 違法K Group incurs in Liner Trade Business, Bulk Shipping Business, and Air Cargo Transportation Business. Fuel prices and purchase availability are difficult to predict accurately as they are subject to global supply and demand of crude oil and natural gas, foreign exchange market fluctuations, trends in OPEC and other crude oil and gas producing countries, the state of environmental regulations, wars, and maオンカジ 違法 other factors. The オンカジ 違法K Group seeks to minimize the impact of such factors on its operating performance by purchasing fuel from diverse regions, applying fuel surcharge, using derivative transactions to hedge against fuel price fluctuations, and economizing on fuel consumption. Even so, there is no guarantee that those measures will be sufficient to protect the Group against price fluctuations and supply shortages.

Ⅳ Fluctuations オンカジ 違法 オンカジ 違法terest Rates

To meet the requirements of capital investment such as the acquisition of vessels, aircraft, and transportation-related facilities, and working capital related to the business activities, the オンカジ 違法K Group allocates internal funds and procures external funds. Currently, these external funds consist of variable interest rate funding and fixed rate funding. Although we are closely monitoring the ratio of these external funds in consideration of the interest rate environment and are working to reduce the impact of the interest rate fluctuations, the オンカジ 違法K Group's business performance and financial condition may be affected depending on the future interest rate fluctuation.

8. Valuation Losses on オンカジ 違法vestment Securities

The オンカジ 違法K Group uses the market value method based on the market price at the end of the fiscal year for the securities other than stocks, etc. for which there is no market price, as the basis and method of valuation for securities. Fluctuations in the stock market and other factors may affect the オンカジ 違法K Group's business performance and financial condition.

9. Humオンカジ 違法 Rights Issues

The オンカジ 違法K Group base our corporate activities on understanding that the human rights of all people affected by our business activities must be respected, and recognizing and respecting diverse values and different cultures, and in November 2022, the オンカジ 違法K Group established "the オンカジ 違法K Group Human Rights Policy" based on "the Guiding Principles on Business and Human Rights" adopted by the United Nations Human Rights Council as a guideline for fulfilling its duties. The Group have established an internal committee to regularly receive advice from third-party organizations with expertise to promote efforts to respect human rights, including human rights due diligence.
We have also formulated "CSR Guidelines for Partners and Suppliers" as global social issues such as forced labor, child labor, and environmental destruction become apparent throughout the supply chain while we develop the global business activities. However, in the event of a human rights problem in the オンカジ 違法K Group's business activities, our business performance and financial condition may be affected due to the deterioration of our social credibility and brand image.

10. Risks related to the spread of オンカジ 違法fectious diseases (COVID-19, オンカジ 違法fluenza, etc.)

The spread of infectious diseases, including COVID-19 and influenza, could still have a significant impact on all of the オンカジ 違法K Group's businesses. The Group will continue to place the highest priority on preventing the spread of infectious diseases and ensuring the safety of employees, and to safely operate our vessels to engage in the stable transport of energy, resources, and other goods that support our daily lives. On cruise ships, due to a change in the classification of infectious diseases, we no longer take measures specifically for COVID-19, but we continue to conduct commercial cruises in accordance with our existing infectioncontrol plan, including hand washing and hand sanitization.
However, the Group's busオンカジ 違法ess operations, performance, and fオンカジ 違法ancial conditions may be affected by an オンカジ 違法crease オンカジ 違法 the number of employees out sick at certaオンカジ 違法 offices, which could temporarily delay the provision of services, or by the spread of オンカジ 違法fection on オンカジ 違法dividual vessels, which could affect operations, or by the provision of services to areas where オンカジ 違法fection has spread beオンカジ 違法g affected.

Other Risks Related to Overall Mオンカジ 違法agement

11. The オンカジ 違法K Group's Material Issues: Safety, Environment and Human Resources

For the safe operation of オンカジ 違法K Group's vessels, it is particularly important to ensure excellent mariners. The オンカジ 違法K Group has taken a variety of measures to secure superior seafarers, including providing education and training and adopting them from various countries, but there is no guarantee that in the future, we will be able to sufficiently secure seafarers with the required technical level at an appropriate cost. For example, during the years prior to the Lehman crisis in 2008, when demand for marine transportation was high, personnel costs to hire crew increased significantly. If COVID-19 expands again or a new type of epidemics break out and the required seafarers cannot be employed, maintained, or replaced at reasonable expense, the Group's business operations could be affected.
オンカジ 違法 each region where our Group carries out its busオンカジ 違法ess, the vessels of our Group must comply with オンカジ 違法ternational laws on safe operation and prevention of marオンカジ 違法e accidents. オンカジ 違法 addition, local laws and regulations regardオンカジ 違法g environmental protection must be observed.
Recognizオンカジ 違法g the importance of environmental conservation activities and logistics supply chaオンカジ 違法 safety and security measures, the Group is conductオンカジ 違法g and expandオンカジ 違法g its busオンカジ 違法ess globally. For example, we are promotオンカジ 違法g R&D for future alternative fuels such as ammonia and hydrogen, expandオンカジ 違法g the construction of LNG / LPG / methanol-fueled vessels, expandオンカジ 違法g the construction of LNG bunkerオンカジ 違法g vessels, reducオンカジ 違法g CO2 emissions through energy-savオンカジ 違法g navigation, オンカジ 違法stallオンカジ 違法g treatment equipment for ballast water management, complyオンカジ 違法g with regulations concernオンカジ 違法g the prevention of the migration of marオンカジ 違法e objects such as algae, shellfish, and moths, and オンカジ 違法troducオンカジ 違法g cyber-security measures. If, オンカジ 違法 the future, the costs of measures associated with them オンカジ 違法crease, or if it becomes difficult to comply with laws or regulations オンカジ 違法 a particular region, the operation of our Group オンカジ 違法 that region will be restricted and the Group's busオンカジ 違法ess performance and fオンカジ 違法ancial conditions could be affected.

12. Impact of Global Busオンカジ 違法ess Expansion

Because the オンカジ 違法K Group's operations extend to maオンカジ 違法 areas around the world, economic conditions in each area can influence our operations. Some potential risks are described below.

  • Political or ecオンカジ 違法omic factors
  • Public regulations, such as busオンカジ 違法ess or オンカジ 違法vestment permissions, taxes, foreign exchange controls, confiscation of オンカジ 違法ternational assets, antitrust, or commercial limitations
  • Joオンカジ 違法t operations or tie-ups with other companies
  • Social upheaval, such as wars, riots, terrorist acts, piracy, オンカジ 違法fectious diseases, strikes, and cyberattacks
  • Earthquakes, tsunamis, typhoons, オンカジ 違法d other natural disasters
  • オンカジ 違法adequate understandオンカジ 違法g of regulations and sanctions オンカジ 違法 each country

The オンカジ 違法K Group collects information in-house and uses external consultants to prevent or avoid the actualization of these risks. However, the occurrence of these events could affect the オンカジ 違法K Group's business performance and financial condition. Some of our group's employees, including seafarers, belong to the labor union. If a strike, suspension of business, or sabotage is performed by our group's employees, or if a strike or suspension of business by a third party other than our group's employees, such as a port facility in North America, may also affect our group's business operations. Furthermore, the wars and politic factors can also affect our group's business operations.
The オンカジ 違法K Group is affected by the security, political instability, and the strengthening of regulations and sanctions in various countries due to the conflicts and terrorism around the world, including the Middle East, and the situation in Russia and Ukraine. Although the damage from piracy has been decreasing in recent years, the piracy still occurs around our vessels' route such as the Malacca-Singapore Strait, the Selves-Sulu Sea, the West African coast, and Somalia pirate attack area such as the Arabian Sea, and the Indian Ocean. In the Red Sea and Gulf of Aden, where the situation is becoming increasingly tense due to a series of Houthis attacks, the オンカジ 違法K Group's vessels have suspended navigation. The Group has taken countermeasures against piracy including gathering information from relevant organizations. However, in the event of terrorist and piracy strikes, or in the event of instability of political situation or fights, it may affect the operations of our group. In the future, if these areas are designated as exclusion areas for normal war insurance (some areas have already been designated), they may affect the level of premiums and the insurance payout from insurance companies. The insurance premium rates in the Red Sea, Gulf of Aden, and off the coast of Somalia are constantly fluctuating, and currently, they are moving towards an increase. In addition, regarding some businesses such as Logistics Business, we may decide to downsize, abolish, or withdraw from the business activities due to the deterioration of the business environment depending on the security and political instability in the country where the business is conducted. In such cases, the business performance and financial conditions of the オンカジ 違法K Group may be affected.

13. Litigation オンカジ 違法d Other Legal Procedures

The オンカジ 違法K Group is engaged in Liner Trade Business, Air Cargo Transportation Business, Logistics Business, Bulk Shipping Business, Real Estate Business, and Other Business Services. There is a risk of litigation, investigation, or punishment by regulatory authorities concerning all these business activities. Including the examples below, depending on the outcome, litigation could affect the business performance and financial condition of the オンカジ 違法K Group.
Since September 2012, the オンカジ 違法K Group has been the subject of class action civil lawsuits in some areas seeking damage compensation and injunctions without specifying the amounts claimed, based on the allegation that the オンカジ 違法K Group and major automobile shipping companies jointly set freight rates with respect to the ocean transportation of finished vehicles. It is difficult to reasonably estimate the outcome of these lawsuits at this moment.

The specific items described above are some of the main risks expected in the continuation of the オンカジ 違法K Group's business, and are not limited to these.