I thought they were going to release them, but it appears that it is unclear now.
Fate of Japanese hostages uncertain
Japanese government officials said they could not confirm the safety of three civilians taken hostage in Iraq by armed militiamen, after hopes rose that they would be released shortly when a faxed message was sent to the Qatar-based Al-Jazeera news broadcaster.
The kidnappers, a virtually unknown armed group calling itself Saraya-al-Mujahideen, had originally threatened to burn the three Japanese citizens alive if Tokyo did not start withdrawing ground troops from Iraq by mid-day on Sunday.
Al-Jazeera said they received a faxed message saying the hostages would be released on Sunday. The broadcaster reported that the fax was in response to an appeal by Iraq's Muslim Clerics Association.
If the hostages are released unharmed, it will bring to a swift conclusion the worst crisis in the premiership of Junichiro Koizumi, who took office in 2001. On Friday, the prime minister refused point blank to negotiate with the hostage-takers, potentially widening the already deep rifts within Japanese society about whether the country's troops should be in Iraq at all.
http://news.ft.com/servlet/ContentServer?pagename=FT.com/StoryFT/FullStory&c=StoryFT&cid=1079420265944This was reported 30 minutes ago.