{"url_path":"/sec/payp/10-k/2026/item-16g","section_key":"item-16g","section_title":"Item 16G Corporate Governance","topic":"sec","document":{"doc_type":"20-F","doc_date":"2026-06-30","source_url":"https://www.sec.gov/Archives/edgar/data/2080845/0001193125-26-289382-index.html","accession_number":"0001193125-26-289382","cik":"0002080845","ticker":"PAYP","issuer_name":"PayPay Corp","edgar_url":"https://www.sec.gov/Archives/edgar/data/2080845/0001193125-26-289382-index.html","primary_entity_key":"0002080845","primary_entity_name":"PayPay Corp"},"word_count":995,"has_tables":true,"body_markdown":"Item 16G. Corporate Governance\n\nAs a foreign private issuer whose securities are listed on The Nasdaq Stock Market LLC, we are permitted under Nasdaq Rule 5615(a)(3) to follow Japanese law and corporate practice in lieu of certain corporate governance requirements otherwise applicable to U.S. domestic companies listed on Nasdaq, subject to specified exceptions. We follow Japanese law and corporate practice in lieu of Nasdaq Rules 5605(b)(1), 5605(d)(1), 5605(d)(2), 5605(e)(1), 5605(e)(2), 5620(c), 5250(b)(3) and 5250(d). The significant ways in which our corporate governance practices differ from those followed by U.S. domestic companies under the Nasdaq listing standards are summarized below. We comply with certain Nasdaq requirements that remain applicable to foreign private issuers, including Nasdaq Rules 5625 and 5640, the requirement to have an audit committee or similar body that satisfies Nasdaq Rule 5605(c)(3), and the requirement that the members of such committee satisfy the independence requirements of Rule 10A-3 under the Exchange Act.\n\nMajority Independent Board\n\nNasdaq Rule 5605(b)(1) requires a majority of a listed company’s board of directors to be independent directors. Japanese law and corporate practice do not require us to have a majority-independent board. As of the date of this Annual Report, our board of directors consisted of nine directors, of whom Yasuyoshi Karasawa, Paul Yonamine, Hiroko Kono and Hiroto Kaneko have been determined by our board of directors to be independent under Nasdaq Rule 5605(a)(2). Accordingly, we follow Japanese law and corporate practice in lieu of Nasdaq Rule 5605(b)(1). Our independent directors regularly meet in executive sessions at which only independent directors are present.\n\nCompensation Committee\n\nNasdaq Rules 5605(d)(1) and 5605(d)(2) require a listed company to have a formal written compensation committee charter and a compensation committee composed of at least two independent directors. We have voluntarily established a Compensation Committee, which is an advisory body, does not have decision-making authority over compensation, and is not composed solely of independent directors. We have not adopted a compensation committee charter that satisfies Nasdaq Rule 5605(d)(1).\n\nUnder the Companies Act of Japan and our Articles of Incorporation, shareholders determine the maximum aggregate annual compensation for our directors who are not Audit and Supervisory Committee members and for our directors who are Audit and Supervisory Committee members. Subject to such shareholder-approved limits, our board of directors delegates to our Representative Director the authority to determine, in consultation with the Compensation Committee, the specific amount of compensation for each director who is not an Audit and Supervisory Committee member. The specific amount of compensation for each director who is an Audit and Supervisory Committee member is determined through consultation among the directors who are Audit and Supervisory Committee members within the shareholder-approved maximum aggregate amount applicable to such directors.\n\nBecause Japanese law and corporate practice do not require an independent compensation committee, and director compensation is governed by the shareholder-approved compensation limits and Japanese-law process described above, we follow Japanese law and corporate practice in lieu of Nasdaq Rules 5605(d)(1) and 5605(d)(2).\n\nDirector Nominations\n\nNasdaq Rule 5605(e) requires director nominees to be selected or recommended either by independent directors constituting a majority of the board’s independent directors or by a nominations committee composed solely of independent directors, and requires a formal written charter or board resolution addressing the nominations process. Japanese law and corporate practice do not impose these requirements. We have voluntarily\n\n132\n\n[Table of Contents](#toc_page)\n\n \n\nestablished a Nominating Committee, which is an advisory body and is not composed solely of independent directors. Our board of directors is responsible for the nomination process for director candidates, in consultation with the Nominating Committee, and we have not adopted a formal written charter or board resolution addressing the nominations process that satisfies Nasdaq Rule 5605(e)(2). Accordingly, we follow Japanese law and corporate practice in lieu of Nasdaq Rules 5605(e)(1) and 5605(e)(2).\n\nShareholder Meeting Quorum\n\nNasdaq Rule 5620(c) requires that the quorum for any meeting of holders of common stock be not less than 33 1/3% of the outstanding shares of a company’s common voting stock. Under the Companies Act of Japan and our Articles of Incorporation, there is no quorum requirement for ordinary resolutions at a general meeting of shareholders, except as otherwise provided by the Companies Act of Japan or our Articles of Incorporation. A quorum of not less than one-third of the total number of voting rights is required for the election of directors and certain other matters. Accordingly, we follow Japanese law and corporate practice in lieu of Nasdaq Rule 5620(c).\n\nThird-Party Director and Nominee Compensation Disclosure\n\nNasdaq Rule 5250(b)(3) requires a listed company to disclose the material terms of certain compensation or other payment arrangements between a director or nominee for director and any person or entity other than the company in connection with such person’s candidacy or service as a director. Japanese law and corporate practice do not require the same disclosure in the manner prescribed by Nasdaq Rule 5250(b)(3). Accordingly, we follow Japanese law and corporate practice in lieu of Nasdaq Rule 5250(b)(3), and we disclose such arrangements to the extent required under applicable Japanese law, SEC rules applicable to foreign private issuers and our internal policies.\n\nDistribution of Annual and Interim Reports\n\nNasdaq Rule 5250(d) requires a listed company to distribute or otherwise make available annual and interim reports to shareholders in the manner specified by Nasdaq. Japanese law and corporate practice do not require us to distribute or make available annual and interim reports to shareholders in the same manner as Nasdaq Rule 5250(d). We make annual and interim financial information available in accordance with applicable Japanese law and SEC reporting requirements, including through reports filed with or furnished to the SEC and, as appropriate, through our investor relations website. Accordingly, we follow Japanese law and corporate practice in lieu of Nasdaq Rule 5250(d). This reliance does not affect our obligation to file or furnish reports with the SEC or our obligation under Nasdaq Rule 5250(c)(2) to submit interim financial information on Form 6-K to the extent applicable."}