In a vote in the House of Councillors, the upper chamber of parliament, both ruling and opposition parties supported the bill to amend the Foreign Exchange and Foreign Trade Control Law.

The bill will enable the authorities to stop cash remittances when they feel it is justified.

Currently, the law says Japan can stop remittances only when necessary to abide by UN resolutions or to cooperate with other countries for world peace.

It is believed hundreds of millions of dollars are transferred from Japan to North Korea, mainly by pro-Pyongyang ethnic Koreans or sympathisers, providing a financial lifeline for a country that suffers chronic food shortages but maintains a heavily armed military.

"I wish that North Korea will sincerely act in a way to help solve the abduction issue and the nuclear issue soon," Prime Minister Junichiro Koizumi told reporters.

His government has repeatedly said in recent weeks it has no immediate plans to impose sanctions.

Chief Cabinet Secretary Yasuo Fukuda, the top government spokesman, told a regular news briefing, "I believe the bill is beneficial because it provides a means for our country to cope with imaginable problems."

North Korea has been involved a standoff with the United States since October 2002 when Washington accused its Stalinist foe of breaking several anti-nuclear pacts with a plan to enrich uranium. Pyongyang has since boasted of possessing a nuclear deterrent.

Tokyo has its own dispute with Pyongyang over the fate of abducted Japanese nationals and the families of five survivors who returned to Japan.

Ruling-party lawmakers had drafted the bill with North Korea in mind although it does not specifically mention Pyongyang.

Calls for sanctions against Pyongyang have grown in Japan after North Korea admitted in 2001 that it had kidnapped Japanese nationals in the 1970s and 1980s to use them as spy tutors, among other purposes.

WAR.WIRE