What is a construction business license? Types, license requirements, and necessary procedures

Updated: July 2025, 3

What is a construction business license?

A construction business license is a license required when operating a construction business (not required if only minor construction work is undertaken).
The types of permits required and the requirements for them will vary depending on the content and scale of the construction work to be undertaken.

In addition, even for construction companies that have already obtained licenses, it is essential to have a basic understanding of the system in order to maintain their licenses and permits.

The person in charge of licensing procedures may change due to personnel transfers, etc., but if the new person does not fully understand the system, they may unknowingly violate the law by missing procedures.

This article explains the construction industry license system, including its types, requirements, and necessary procedures.

Purpose of the Construction Business Law

Systems relating to the construction industry are primarily determined by the Construction Industry Law.

(the purpose)
Article 1 This law ensures the proper execution of construction work and protects the client by improving the qualifications of those engaged in the construction industry and optimizing construction work contracts. The purpose is to promote the healthy development of the construction industry and thereby contribute to the promotion of public welfare.

The purpose of the Construction Business Act is to ensure that the construction industry, which supports our lives, functions properly, by carrying out construction work with quality-assured technology, and ultimately to promote public welfare.

In order to improve the quality of the construction industry and to streamline contracts, the Construction Business Act stipulates a system of construction business licenses and matters related to contracts (the principle of contracts being in writing, statutory requirements for the items to be included in contracts, the prohibition of blanket subcontracting, etc.).

Construction business license classification

Although it is generally referred to as a "construction business license," there are various classifications.

Category of licensing authority

The classification of the licensing administrative authority will vary depending on the location of the "office" operating the construction business.
Depending on this classification, the government office to which you submit various procedures will change.
The requirements are the same regardless of the licensing agency, but the detailed instructions may differ in some cases.

* A business office refers to a place of business that is actually conducting business, such as an office that regularly handles construction contracts. This includes not only registered head offices and branches, but also unregistered offices. In principle, it does not include stores that are not involved in the business of the construction industry, or offices and material storage areas at construction sites.

◆Minister of Land, Infrastructure, Transport and Tourism permission

If the business has offices in two or more prefectures, permission is required from the Minister of Land, Infrastructure, Transport and Tourism.
The administrative authority with jurisdiction will be the Regional Development Bureau or other authority that has jurisdiction over the construction company's head office (main business office).
(For example, if the head office is in Tokyo, it is under the jurisdiction of the Kanto Regional Development Bureau.)

◆Prefectural governor permission

If the business office is located in only one prefecture, permission must be obtained from the governor of that prefecture.
The administrative authority with jurisdiction will also be the prefectural government in question.
(For example, in Tokyo, it is under the jurisdiction of the Tokyo Metropolitan Government.)

Industry (type of construction work)

Construction work is classified into 29 "industries" depending on the content of the work.
Construction companies must obtain either a "general" or a "specific" construction business license depending on their type of business.

Types of permits based on the scale of construction work (order amount to first-tier subcontractor)

◆Specific construction business license

If you undertake construction work as a prime contractor and place an order with a first-tier subcontractor for a total amount of 4,500 million yen or more (7,000 million yen or more incl. tax for general building works), you will need a specific construction business license.

◆General construction license

If you are not undertaking any construction work that requires a specific construction business license, you will be granted a general construction business license.
In other words, if you are only doing subcontract work, or even if you are doing prime work, if the amount of the order to the subcontractor is low enough,
General construction business permit.

The requirements for a specific construction business license are stricter than those for a general construction business license.
(Financial requirements, qualifications required for full-time engineers at the sales office)

Construction permit requirements

Appropriate management structure

Management of the construction industry has characteristics that are significantly different from management of other industries, as follows:

In light of these points, we are looking for people who have a certain amount of experience in management work in the construction industry (so-calledManager responsible for management operationsAn appropriate management structure is required, such as having a board of directors and a committee.

◆Requirements for managers of business operations

◆Individual certification of persons responsible for managing business operations

If you wish to become a manager of management operations with the following experience,
Before submitting a change notification, you must receive individual certification in advance.

In addition, the following documents are required to apply for certification:

Enroll in appropriate social insurance

All construction business establishments are required to enroll in health insurance, employee pension insurance, and employment insurance.
(Excluding exempt establishments)

Establishment of dedicated engineers at sales offices

Specialized knowledge of construction work is required to ensure the proper conclusion and execution of construction contracts. Since each office is responsible for tasks such as estimating, bidding, and concluding contracts for construction work, it is necessary for all offices to have full-time engineers with certain qualifications and experience.

Dedicated engineers at each office must be assigned according to the "industry" of construction work being carried out at that office.
The qualifications required for a full-time engineer vary depending on the industry and type of license (specific or general).

A full-time engineer is required to install the system on a full-time basis at each office.
Let's increase the number of people with relevant qualifications so that the relevant person is not suddenly absent due to personnel changes, etc.

◆Requirements for a full-time engineer

The requirements for full-time engineers are different for the general construction industry and the specific construction industry.

◆Supervising engineer

A supervising engineer is an engineer who is assigned full-time to a construction site and is in charge of the technical management of the construction when the total contract price of the subcontract agreement concluded by the general contractor to carry out the work in question is 4,500 million yen or more (7,000 million yen or more for general construction work).

Construction projects that require the assignment of a full-time supervising engineer to each construction site include most construction projects, both public and private, except for private homes.

In addition, as the shortage of engineers across the industry has become more serious in recent years, the government has been taking measures such as introducing a "specified skills" system that allows foreigners to be employed and relaxing the work experience requirements for full-time engineers.

Financial base, etc.

◆General construction business license (must meet any of the following requirements)

• Amount of Equity Capitalis 500 million yen or more
• 500 million yenMust have the ability to raise funds.
• The applicant must have a track record of operating a construction business continuously under license for the past five years immediately prior to the application for the license.

◆In the case of a specific construction business license (all of the following must be met)

• The amount of the deficit isDoes not exceed 20% of the amount of the principal
  Deficit amount: Negative amount of retained earnings carried forward – (capital surplus + legal reserve + other retained earnings)
• Current ratio is 75% or more
  Current ratio: Total current assets ÷ Total current liabilities x 100
• The amount of capital is 2,000 million yen or moreand the amount of equity capital is4,000 million yenMore than this

Integrity

The applicant for a license, its officers, employees under Article 3 of the Ordinance (branch managers of each business office, etc.),
It is necessary that the person is not a person who is clearly at risk of engaging in "fraudulent" or "dishonest" conduct regarding the contract.

Sales office requirements

One of the requirements for a construction business license is to have a business office, and this business office refers to the place where the contract is concluded.

[Business office requirements]

① Carrying out practical work such as estimating, bidding, and concluding contracts for contract contracts.

②There is a space (reception room) where contracts can be concluded, etc.

③ Equipped with a landline telephone, desk, document shelf, various office ledgers, etc.
*In some regions, when applying for a construction permit, you may be required to submit company documents that can confirm your phone number, such as business cards or envelopes with a landline phone number.

④It must be clearly separated from the residential area and other offices.
*If you are renting an office space or using a private residence, it must be separate from the residential area and other offices.

⑤Installation of a signboard or sign that allows the business office to be identified from the outside
*You will need something to identify your office, such as your postbox or at the entrance to your office.

⑥ The company has a full-time manager of business operations or an equivalent employee

⑦If rented, it must be permitted to be used as an office.

Not subject to disqualification requirements

If the applicant for permission or its officers or employees as specified in Article 3 of the Ordinance falls under any of the disqualification criteria, permission will not be granted.
(Examples of disqualification criteria: Those who have been declared bankrupt and have not had their rights restored, etc.)

Flow of new construction business license application

To obtain a construction business license, you must follow the following procedures:

① Confirm the application destination

　Governor's permission: Apply to each prefectural office
　Minister's permission: Apply to each regional development bureau, etc.　

The documents required and whether or not you need to make a reservation in advance will vary depending on where you apply.

②Prepare all application documents

Check the types of documents required and download the necessary forms from the website of each application destination.

The documents that must be submitted include documents prepared by the applicant as well as certificates obtained from government agencies, etc.
Examples: Certificate of all historical matters, tax payment certificate, identity cards of officers and employees under Article 3 of the Ordinance, certificate of non-registration, etc.

③ Submit documents and pay fees

When applying for a new construction business license, a fee or registration license tax will be charged.
Costs vary depending on the type and combination of permits you apply for.

◆Governor's permission

Either general or specific: Fee 9 yen
Applying for both general and specific at the same time: Fee 18 yen

◆Minister's permission

Either general or specific: Registration license tax 15 yen
Applying for both general and specific at the same time: Registration license tax 30 yen

Procedures required after obtaining a construction business license (example)

Renewal application

Update deadline:on the day the period expiresUntil 30 days prior, Until
　
Validity period of construction business permit The5 years.
*Expires on the day before the day corresponding to the 5th year from the date of permission.
　The same applies even if the last day of the license validity period falls on a Sunday or other administrative agency holiday..
　
Governor's permission2 months agoTherefore, the minister's permission is3 months agoOrare accepted, but
If you fail to follow the procedures, your permit will expire at the end of the period.
If it has expired, it will be treated as a new card rather than a renewal.
　
Additionally, if you do not submit a financial statement change notification every year, you will not be able to update your financial statements.
ご 注意 く だ さ い.

Financial report (notification of change in financial results)

Submission deadline: Every business yearAfter the degree endsWithin one month

This financial statement change notification isMust be submitted after each business yearHave to.
It is necessary to submit a notification of change in financial statements for the business year., if you fail to submit this,
In addition to being subject to administrative guidance, you will not be able to apply for renewal.

This is a procedure for reporting financial status and construction history at each fiscal year end.
To undergo the management matters examination, start with this financial statement change notification.　

<Documents to be submitted>
・Construction history (completed construction amount)
・Construction amount for the last 3 years
・Financial statements in the specified format (balance sheet, income statement, statement of changes in shareholders' equity, notes)
·Tax certificate
·Business report

<Submission destination>
Permission from the Minister of Land, Infrastructure, Transport and Tourism: Submitted to the Regional Development Bureau, etc. via the prefectural governor that has jurisdiction over the location of the head office.
Prefectural governor permission: Submitted to prefectural governor

Various change notifications

Construction companies must submit a change notification when there are changes to the information they have notified (officers, full-time engineers at the business office, employees under Article 3 of the Ordinance, business type of the business office, etc.) (Subsequent notification).
The deadline for submission will vary depending on the changes. (Within 14 days or within 30 days from the date of change)
　
If there are any changes to the information you have applied for, such as your trade name, location, business office, officers, or capital, you must notify us by the deadline.

Various applications

In addition to "new applications" and "renewal applications," there are other cases in which application is required.
Example: Addition of new business type, new general/special (general → specific, specific → general), new license change (Minister → Governor, Governor → Minister, etc.)
Unlike "change notifications," these applications must be submitted in advance.

Regarding approval for construction business succession, etc.

From October 10, XNUMX, a new system regarding business succession and inheritance regarding construction business licenses has been established.

<Before revision>
Until now, when a construction company transfers, merges, or splits a business,
In addition to closing down the original construction permit, it was necessary to apply for a new construction permit.
In this case, there is a disadvantage that there will be a blank period between the date of business closure and the date of new permission during which the contractor cannot operate a construction business with a contract amount of 500 million yen or more (1,500 million yen or more for complete construction work). I did.

<After revision>
When carrying out business succession, it is necessary to obtain prior approval in advance, and in the case of inheritance, by obtaining inheritance approval within 30 days after death, there will be no blank period and the successor (assignee, surviving corporation of merger, split It has been stipulated that the successor corporation (successor corporation) and the heir will inherit the status of the successor (assignor, merged corporation, split successor corporation) and the decedent as a construction business operator.

Forms of business succession and inheritance/application conditions

Permit application destination and permit number

Approval applications can only be made in a prefecture if both the successor (inheritor) and the successor (inheritor) are licensed by the prefectural governor, or if the business office for the construction business is located within the prefecture. Only if it is a thing. Even if there are multiple successors in a merger or split, etc., if all of them are within the same prefecture, prefectural approval will apply.

If either the successor (inheritor) or the successor (inheritor) is a construction business operator licensed outside the prefecture, approval from the Minister of Land, Infrastructure, Transport and Tourism is required. In this case, it is necessary to apply for approval to the Regional Development Bureau that has jurisdiction over the prefecture where the successor's main business office is located.
　
At least one of the successor (inheritor) or successor (inheritor) has a business office for the construction business outside the prefecture and has a construction business license from any administrative agency. If you do not, you will not be able to apply for approval.

Regarding the license number, if a construction business license is succeeded by an unlicensed business, the previous license number will be inherited, and if the succession is between multiple construction business licensees, it will be possible to select the license number to be inherited. It has become.

Regarding full-time engineers after the scheduled date of succession

As a general rule, full-time engineers in the licensed industry to be succeeded will remain the same full-time engineers for each industry even after the scheduled date of succession.
The person must continue to work full-time.

Can foreign companies obtain construction licenses?

Foreign corporations can also obtain construction licenses if they meet the requirements, and our company has a track record of supporting foreign corporations in expanding into the country.
Please check the link below for the acquisition process.

Construction business license application for foreign corporations

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