TOKYO, Dec. 4 (Xinhua) -- The Japanese Diet ratified new legislation on Friday to freeze the sale of shares in the state-owned Japan Post Holdings Co. and its banking and insurance units to bring a halt to the privatization process spearheaded by the ousted Liberal Democratic Party (LDP).

    The law's enactment came after Tuesday's passage of the related bill in the House of Representatives at which the LDP abstained from voting.

    The law forms part of the Democratic Party of Japan's (DPJ) pledge to review the postal service and make revisions that better serve the public under a new management structure, and follows a bill presented in the House of Councilors' plenary session.

    Former Prime Minister Junichiro Koizumi of the Liberal Democratic Party had planned to divest all of the shares of the Postal Savings Bank and the Postal Life Insurance Company, the financial wings of the postal system, within 10 years, and two-thirds of the shares of the Japan Postal Delivery System within 10years.

    However DPJ Prime Minister Yukio Hatoyama has claimed that the postal business, the most visible symbol of the former LDP's policy reforms, has been distorted by the Koizumi-led government and that the current structure of the Japan Post group is in need of wholesale revision.

    "We will submit a basic bill on how to specifically reform postal services to the ordinary session next year," said postal services minister Shizuka Kamei at a press conference on Friday.

    Kamei indicated that it was the government's intention henceforth to constitutionally reconfigure postal operations so as to bolster regional commerce and growth.

    Japan Post is one of Japan's largest companies, with 240,000 employees and 3 trillion U.S. dollars in assets. In 2008 it boasted revenues of some 20 trillion yen (220 U.S. billion dollars).

    In addition to its postal operations, Japan Post owns a huge bank and a huge insurance company. The bank alone has 2 trillion U.S. dollars in deposits, effectively making it the largest savings bank in the world.

    For many years, Japan Post was a state-owned enterprise, until four years ago, with an overwhelming popular mandate, the then Prime Minister Junichiro Koizumi decided to privatize operations to raise the efficiency of both postal services and investments.

    The LDP-led government instituted a 10-year process of privatizing the state-run postal services in October 2007. Four companies were created to provide mail delivery services, customerpostal services, banking services and insurance operations under aholding company.

    Prime Minister Hatoyama appointed Shizuka Kamei, a staunch advocator of antireform in the Koizumi era, as minister for PostalServices and the driving force behind the DPJ's proposed reversal of postal privatization. In turn Kamei charged Former Vice FinanceMinister Jiro Saito with the role of president of Japan Post Holdings Co.

    The DPJ has drawn some criticism from the public, press and opposition parties, as the new government's election promise was to end the appointment of former bureaucrats into public enterprises and state affiliates -- Saito's appointment to the top-position has seemingly flown in the face of the party's own mandate, according to a number of political commentators close to the matter.