The Japan Expressway Holding and Debt Repayment Agency, an independent administrative agency, assumes three important roles within the framework of privatization of highway public corporations.

The first of these roles is to hold expressway assets and to receive fees from expressway companies for the lease of such expressway assets as the agency's main financial source, in order to secure repayment within 45 years of the debts inherited from former public corporations and of any debts that may be incurred due to future construction projects. To accomplish this, the agency has formulated a rational and sound long-term 45-year debt repayment plan, based on agreements that were concluded with six expressway companies on March 31, 2006. Furthermore, to ameliorate the problem of rising interest rates, the major risk factor in repaying this debt, we are endeavoring to achieve effective liability management through such means as procuring ultra long-term financing during periods of low interest rates.

Since the expressway assets are to be transferred from the agency to the national government or other road administrators by 2051, when the debt is scheduled to be fully repaid, the second role of the agency is to exercise legal authority on behalf of road administrators in a timely and appropriate manner until the abovementioned transfer, as well as to properly manage and maintain expressways in cooperation with the expressway companies, in order to hand over safe expressways to the next generation. For this purpose, we receive reports concerning the management and maintenance of expressways from expressway companies every year, and inspect the actual state of management of the expressways. We also work closely with expressway companies to take the necessary steps to provide proper maintenance and management services that reflect the specific circumstances of each region

To help economic stimulus packages of the government and to enhance effective use of expressways, the agency, incorporation with expressway companies, proposed and was approved a plan in fiscal year 2008. The plan includes: 1) lowering of expressway tolls such as providing special weekend discounts (with a 1,000 yen ceiling for passenger vehicles in rural regions) and 2) construction of additional "Smart Interchanges" with electronic toll collection (ETC) gates.

The agency's third role is to enhance the transparency of the project itself and actively disclose information so as to fulfill the explanatory responsibility of the agency in cooperation with the six expressway companies. We therefore disclose information on our website, in addition to financial statements, information such as the debt payment plan and performance, the abovementioned reports on management and maintenance, and income and expenditures for each highway.

In the course of fulfilling these three roles, the agency has promoted efficient organizational operations and the reduction of business costs since its establishment. All of agency officers and employees will continue to make every effort to secure repayment of debts in responding to the changes in social conditions that may affect expressway business

The agency takes its roles seriously, and is committed to fulfilling its debt repayment responsibility, as well as to realizing efficient management of expressway services by responding to social changes in a prompt and appropriate manner. With your continued support and guidance, all of us at the agency, officers and employees alike, will make every effort to meet these commitments.

November 31, 2009

Hirotada Seyama
President,
Japan Expressway Holding and Debt Repayment Agency