Koizumi has dissolved the Japanese Diet in response to rejection of postal services commercialization bill

The House of Councillors, the upper house of the Diet of Japan, voted on the controversial bill that would have privatized the Japanese Postal Service at around 1 p.m. (JST, UTC +8) on Monday, August 8. The bill was rejected by a slim margin – 108 for, 125 against, one abstention and two intentional absences – after a rebellion within the ruling Liberal Democractic Party (LDP).

The Prime Minister, Junichiro Koizumi, had promised that the privatization of the Postal Service, which is also Japan's largest savings bank, would "revitalize" the Japanese economy. He has also stated that the commercialization of the Postal Services was at the core of his policies, and threatened to dissolve the houses and call for an immediate election in case of a defeat.

As promised, the rejection led to an immediate call of the cabinet ministers at 3pm to dissolve the House of Representatives. For the dissolution to be valid all cabinet ministers must jointly sign an edict issued in the name of the Emperor. Cabinet minister Shimamura Yoshinobu, the Minister of Agriculture, Forestry and Fisheries, refused to sign the edict, and resigned. The dissolution was officially announced by Chair Kono at the Diet later in the evening.

The election is reported to be held on September 11.