What is Escrow?

l	Definition of Escrow
Escrow is the intermediary service to guarantee transaction safety such as ensured settlement of proceeds and delivery of products and properties between the contracting parties.
In Japan, it is translated as a "deposit with third party"
It is a settlement method of transaction based on certain requirements, and is a system developed broadly in the area of real estate transaction in the U.S.
Definition of Escrow = California Financial Code Section 17003
"Escrow" means any transaction in which one person, for the purpose of effecting the sale, transfer, encumbering, or leasing of real or personal property to another person, delivers any written instrument, money, evidence of title to real or personal property, or other thing of value to a third person to be held by that third person until the happening of a specified event or the performance of a prescribed condition, when it is then to be delivered by that third person to a grantee, grantor, promisee, promisor, obligee, obligor, bailee, bailor, or any agent or employee of any of the latter.
Escrow service provided by Yamada Escrow Trust is Japan's first full scale escrow that has settlement ability using trusteeship function.

Why trusteeship function is necessary?
1.Legality of Accepting Settlement Funds
"The Investment Deposit and Interest Rate Law"

Settlement funds accepted by an ordinary operating company may be regarded as a "deposit" and may violate the Law.

"The Banking Law"
Involvement in fund transfer without cash between the parties at distant places by an ordinary operating company may be regarded as a violation of exchange transaction regulations of the Law.
2.Safety of Safekeeping of Settlement Fund (Escrow Account)
Bankruptcy remote function of trust
 ― Trust asset is protected by the Trust Law, even if a trust company is bankrupt, still the funds are protected as trust assets.
In case a trustee is ordered to go into bankrupt proceedings, assets in trust asset are not included in bankrupt estate or affairs.
Compulsory seizure, provisional seizure, provisional disposition, execution of security right, foreclosure sale, or disposition for failure to pay national tax are not allowed to the assets that belong to trust asset, except for a case based on the claims against debt obligations in connection with trust property.
A person who has claims against a trustee who has an obligation to shoulder responsibility to fulfill by the inherent property or the assets that belong to trust asset of other trusts only may not offset the obligation for the claims that belong to trust asset by the above claims.
Trustee’s obligation to separately manage trust
 ― Property is managed by trust by separately managing property from other properties.
Trustee must manage the assets that belong to trust asset separately from the inherent property or the assets that belong to trust asset of other trusts.
Ⅲ. Press Release