Setting Up Business in Japan

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Within the jurisdiction of the Osaka Immigration Office: Osaka, Kyoto, Hyogo (Kobe), Nara and other KINKI area.

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Foreign companies and individuals wishing to expand the business into Japan or start a new business in Japan should consider Japanese administrative system and domestic laws and regulations regarding incorporation, taxation, business lisences, employment (HR), and insurance as well as immigration system.

Also, you will need to make a rental/lease agreement for the office space as well as to open a bank account for the business.

Here is a list of what you should consider mainly to set up a business in Japan for the first time.

 

【1】 Business Location

Decide your business location. In major cities such as Tokyo and Osaka, there would be incentive packages/programs available for foreign companies and individuals to encourage investment outside Japan and start the business in the area.

In case that you intend to apply for "Business Manager" visa status based on your business, you need to find an office space in advance. You can set up a company with virtual office, however, you cannot satisfy requirements of "Business Manager" visa status with virtual or shared office – you need to find an office space where you can specify the existance of the company if you intend to apply for Business Manager visa status.

Most of the administrative procedures in Japan require to be processed at relevant government/public offices which handle the area of your company. We recommend you to look for the specialists in the area where you are planning to start the business.

【2】Types of Business Operation

There are several types of business operation when individuals and/or companies outside Japan consider to start a business in Japan.

In case of individuals:

  • Sole proprietorship/Self-employed
  • Corporation: i.e. Kabushiki Kaisha (K.K.) and Goudou Kaisha (G.K.)

In case of foreign companies:

  • Representative Office
  • Branch Office
  • Corporation: i.e. Kabushiki Kaisha (K.K.) and Goudou Kaisha (G.K.)

From immigration point of view, it is not easy to certify your eligibility for Business Manager visa status (or other working visa) in case of starting sole proprietorship – especially to certify the business scale and stability, so we recommend you to set up a company which requires legal registration at Legal Affairs Bureau.

In case of setting up a Representative Office or Branch Office in Japan, at least one representative person should be a resident in Japan.

K.K. and G.K. can be set up without any resident in Japan, however, it would not be easy to process without any resident in Japan. In addition, the initial capital requires to be transfered to one of the sponsor/invertor’s bank account in Japan – if none of the sponsor/investor has a bank account in Japan, you need to find a person who has a bank account in Japan and can be a sponsor of the company. You should take all the process of incorporation into account before you start.

See also >> Types of Business Operation

Moreover, some business is required to obtain specific license or permit before starting the business. The procedure for obtaining each business license and permission is different. So, you might want to ask a specialist to check whether your business has to have any business licenses or permissions in advance.

Business Licenses or Permissions in Japan

Restaurant Industry, Secondhand Dealer/Shop, Retail/Wholesale/Trade of Alcohol, Retail/Wholesale/Trade/Manufacturing/Leasing of Medical Equipment, Wholesale/Trade/Manufacturing of Cosmetics, Warehousing, Transport Industry, Financial Instruments Business, Building/Construction Industry, Real Estate, Worker Dispatch Service, Hotel/Hostel Industry, Travel Industry, Hospital, Nursing Insitute, and so on…

【3】Representative in Japan

As we noted in [2] above, there need to have one representative who is a resident in Japan in case foreign individuals/companies would like to set up a Branch Office in Japan. In case of incorporation, it might be difficult to open a bank account in Japan if you don’t have any person to help you in Japan.

In addition, foreign individuals who stay in Japan with temprary visa cannot register their residence in Japan.

Therefore, you should consider;

– obtainning other types of long-term visa such as Student and so on, first. Then, while you are engage in the activity permitted, you can open a bank account and prepare for setting up a buisness in Japan.

– finding a partner who is Japanese or a resident in Japan and can help to set up your business in Japan.

In case of foreign company which doesn’t have any resident in Japan but plans to set up a business entity in Japan, we recommend to open a represeintative office first and transfer an employee/director as a representative person to Japan in order to begin with the market reserch, client development and preparation for setting up a branch or company. It is much easier way to set up a branch or company after having a resident in Japan.

【4】Research the system and laws and regulations in Japan – find Specialists to help you.

When you start a business in foreign country, it is important to understand the system of Japan regarding immigration, taxiation, social security, labor management, company law, and other matters related to company and business management.

There are various types of specialist in Japan as follows:

  • 税理士 Zeirishi: tax and accounting
  • 司法書士 Shihoushoshi: registration of company and real estate.
  • 行政書士 Gyouseishoshi: immigration, business setup, business licenses
  • 社会保険労務士 Shakaihoken Roumushi: labor management, social insurance and pension
  • 弁護士 Bengoshi: law as a whole, lawsuit
  • 弁理士 Benrishi: patent and trademark
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