Points for establishing a Japan branch
Updated: July 2024, 11
One way for overseas corporations to conduct business activities in Japan is to establish a branch office.
It becomes a branch attached to a corporation in its home country, which is the head office, and as a general rule, profits are taxed on income generated within Japan.
Legally, it is called a "sales office," but the name does not necessarily have to be "sales office," and you can choose any name you want, such as "branch office," "branch office," or "Japan office."
Main considerations for establishing a branch office
| Installation method | Establishment can be done by applying for registration of establishment of a foreign company's business office to the competent legal affairs bureau. |
| work activities | Acts based on contracts that constitute sales, such as sales and services, are possible. |
| Opening a bank account | It is possible to open an account as a "Japan branch". |
| Remittance to home country | Remittances to your home country are possible and are generally tax-free. * |
| Capital | There is no set capital for branches, and the capital of the head office is recorded on the registered register. |
| Board Member | At least one "Representative in Japan" must be appointed to represent the branch. At least one "representative in Japan" must be a Japanese or foreigner who is registered as a resident in Japan. |
| General Meeting of Shareholders | There is no obligation to hold a general meeting of shareholders. |
| Transition to a corporation | A simple transition is not possible, and you will have to go through the procedures of closing the Japanese branch and establishing a Japanese corporation (corporation). |
| Head Office's Responsibilities to Creditors | The head office must be responsible for any debts arising from transactions, lawsuits, etc., without any limit. |
| employment of employees | Possible |
| Notification to tax office, etc. | need ※ |
| Taxation | It is subject to corporate tax (national tax), local corporate tax (national tax), corporate inhabitant tax (local tax), business tax (local tax), etc. |
| Subject to taxation | The following are representative examples. Income from domestic business Compensation for dispatching engineers, etc. Rental fees for domestic real estate, etc. Interest on deposits and savings deposited at business offices in Japan Dividends received from domestic corporations Interest on loans to persons conducting business in Japan License fees, royalties, and fees for the use of machinery and equipment received from persons conducting business in Japan. Income from the transfer of real estate in Japan. Income from management of domestic assets "Quoted from JETRO" |
*Please consult your tax accountant/accountant for details. We can also introduce you to tax accountants and accountants affiliated with our company.
Determination of representative in Japan
When establishing a branch, it is necessary to appoint a "Representative in Japan" to represent the branch and register it with the Legal Affairs Bureau.
The representative in Japan has the authority to perform all judicial and extrajudicial actions in Japan, so it is necessary to select an appropriate person.
It is possible to appoint multiple representatives in Japan, but at least one person must have an address in Japan (registered as a resident).
When appointing a foreigner, it is necessary to obtain a status of residence such as an investment management visa (business management visa), an intra-company transfer visa, or a specialist in humanities/international work visa.
We often see cases in which foreigners holding permanent resident visas are appointed.
Affidavit (AFFIDAVIT)
An important part of the procedure for establishing a Japanese branch is the preparation of an affidavit.
This is a system recognized in many countries around the world, including Western countries, and refers to a document sworn outside a court in front of a notary public or other person administering the oath, affirming that the contents are true, and signing the document.
It seems that there are also documents that are sworn as oath or take an oath.
To register a branch, you are legally required to submit the following documents ① to ④.
① Documents sufficient to acknowledge the existence of the head office
②Document certifying the qualifications of the representative in Japan
③Articles of incorporation of the foreign company and other documents sufficient to identify the nature of the foreign company
④ If there is a provision regarding the public notice method pursuant to the provisions of Article 939, Paragraph 2 of the Companies Act, a document proving this.
It is possible to prepare each document from ① to ④ and submit it when applying for registration, but for example, in ①, it will be a certified copy of the registry of the head office in your home country, but you will need to have it notarized in your home country and submit it when applying for registration. Translated documents must be submitted, making the procedure complicated.
Therefore, it is possible to simplify the process by combining the items ① to ④ into one document, having it notarized as an affidavit by someone who is qualified to notarize, and submitting it.
The preparation of this affidavit can be divided into those that can be done within Japan and those that must be completed in the home country, depending on the country of the head office.
Period required for procedure
Once all the documents necessary for the registration application have been prepared and the application is submitted to the Legal Affairs Bureau,About 1 weeksComplete with
However, before this application, procedures such as certification of an affidavit are required.
Procedures vary depending on the country, so
It is necessary to confirm the specific procedures as early as possible before proceeding with preparations.
For inquiries regarding the establishment of a Japanese branch office or permissions related to the establishment of a Japanese branch office, please contact the Support Administrative Scrivener Corporation.
Support Administrative Scrivener Corporation provides legal services and consulting to companies entering the Japanese market and those establishing a base in Japan.
The work related to expanding into Japan is highly specialized, and it can be said that it is one of the fields where there are few administrative scriveners who can handle it.
Our staff speaks a variety of languages and has experience in filing applications. Please feel free to contact us. At our company, our affiliated judicial scriveners handle registration applications to the Legal Affairs Bureau, our affiliated tax accountants handle applications for tax matters such as tax offices, and our affiliated social insurance and labor consultants handle applications for labor insurance, social insurance, etc.
Our dedicated staff handles cases nationwide.
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