UPDATE 4-Japanese court grants bail for ex-Nissan chair Ghosn, prosecutors appeal

A Japanese court granted bail to ousted Nissan Motor Chairman Carlos Ghosn on Tuesday, a decision prosecutors swiftly appealed, delaying an immediate release of the once-feted executive after more than three months in jail.

Judges at the Tokyo District Court accepted defence lawyers' assurances that Ghosn would submit to extensive surveillance and set his bail at $9 million, an apparent win for his new legal team on his third bail request. But prosecutors swiftly appealed that decision and demanded that Ghosn - the architect of Nissan's automaking partnership with France's Renault and once one of the global auto industry's most celebrated executives - remain in jail pending his trial.

A release would allow Ghosn to meet more frequently with his lawyers and build a defence ahead of his trial in the coming months. He faces charges of aggravated breach of trust and under-reporting his compensation at Nissan for nearly a decade, to the tune of $82 million. If convicted on all the charges he faces up to 10 years in jail. The ex-chairman of Nissan, Renault and Mitsubishi Motors has denied wrongdoing.

Nissan declined to comment on Tuesday's bail decision, which comes a day after the head of Ghosn's new legal team said he was optimistic the executive would be released with a promise to submit to surveillance. The case has cast a harsh light on Japan's criminal justice system internationally. In Japan, suspects are frequently kept in detention for long periods and defence lawyers are prohibited from being present during interrogations, which can last eight hours a day.

Public opinion likely played a role in the court's decision to grant bail, along with assurances from Ghosn's lawyers that he was prepared to be under any restraint, said Shin Ushijima, a former prosecutor and lawyer. "The court was partly influenced by the opinion of the entire world," Ushijima said. "People in general thought (the detention period) is too long. This will change Japan's criminal procedures."

BIG BAIL It was not immediately clear whether the appeal by prosecutors would be successful. The court must now determine whether to approve or reject the motion, which could be decided later in the day. If it rejects the appeal, Ghosn could leave the Tokyo detention centre after posting bail.

While his 1 billion yen ($9 million) bail amount would rank among the highest on record in Japan, it is half the 2 billion yen paid in 2005 by Mitsuru Asada, a businessman who was later convicted of defrauding the government through a beef buy-back programme. Ghosn, who turns 65 on Saturday, has spent more than 100 days in a 4.8 square metre (52 square foot), tatami mat-lined cell. In his only court appearance, he said in January he looked forward to his trial to "finally have the opportunity to defend myself".

In an interview later that month with Japan's Nikkei newspaper, he said Nissan executives opposed to his plans for closer ties with partner Renault were behind the allegations against him. The appointment last month of lawyer Junichiro Hironaka, nicknamed "the Razor" for his combative style, to lead his defence was widely seen as a move to adopt a more aggressive legal strategy.

Hironaka has argued the allegations should have been resolved as an internal company matter, and blasted the judicial system for keeping his client in jail. Ghosn's France-based lawyers meanwhile revealed on Monday they had complained to the United Nations that his rights had been violated during detention in Japan.

Ghosn nonetheless faces a criminal justice system where only three of every 100 defendants pleading not guilty are acquitted. There is also no plea deal mechanism that would allow Ghosn to agree to lesser charges for a lighter sentence.

($1 = 111.8400 yen) (Additional reporting by Linda Sieg; Writing by Naomi Tajitsu and David Dolan; Editing by Stephen Coates and Christopher Cushing)

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