TOKYO — Japanese companies cannot use a national security designation as a tool to thwart foreign takeovers, a senior finance ministry official said, pushing back at speculation that Tokyo's foreign exchange act could be manipulated for protectionism.

The comments follow media reports retail giant Seven & i Holdings is seeking to be classified as "core" to national security under the Foreign Exchange and Foreign Trade Act (Fefta) to fend off a buyout bid from Canada's Alimentation Couche-Tard.

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