The lower house of Japan's parliament has passed legislation to privatise the country's postal service, Japan Post.
The passage follows a huge ruling coalition victory last month in an election that Prime Minister Junichiro Koizumi made a virtual referendum on the legislation.
The legislation to achieve that goal, the core of Mr Koizumi's reform strategy, is expected to pass the upper house later this week, probably on Friday.
The defeat of the bills in August by the upper chamber, where ruling Liberal Democratic Party rebels joined the opposition in voting against them, had triggered the September 11th lower house election.
Under the legislation, Japan Post, which has 25,000 offices and 260,000 employees, would be privatised in October 2007.
Four separate entities would be established under a holding company to handle mail delivery, over-the-counter services at post offices, postal savings and postal life insurance.
The government would initially hold 100 per cent of the holding company's shares. It would reduce the percentage of shares it holds at an early stage but would always retain more than one-third of the shares.
The holding company would sell all shares in the postal savings and postal life insurance firms by March 31st, 2017.
A monitoring committee would review progress of privatisation every three years.
Japan Post includes a savings bank that is the world's biggest deposit-taking institution and Japan's largest life insurer. Together they held more than $3 trillion in investment assets at the end of June.
Japan Post also holds a quarter of total personal assets in Japan.