Establishing a Company in Japan
Setting up business in any country inevitably comes with many challenges, decisions and hurdles along the way, and Japan is no different.
From understanding the legislation to finding an appropriate office, establishing a company in Japan can be a stressful process.
Whether you wish to start a Japanese business from scratch or establish a branch office or subsidiary of an existing company, we can support you through this all with minimal stress, also dealing with any visa and business license issues along the way.
Steps to Setting up a Company in Japan
The characteristics of the different types of company available to set up in Japan can be broadly summarized as follows.
In terms of how each of the above is established, the precise procedure varies depending on the type of company.
The following describes the main steps necessary in a typical case.
Joint-Stock Corporation
※Time to establish: approx. 2 months after deciding details of company to be established.
| Establishment process | |
|---|---|
| ➀ | Determination of details of company to be established (Incl. trade name, location of head office, business objectives, amount of capital, names of directors and representative directors) |
| ② | Review of identical corporate names at the Legal Affairs Bureau |
| ③ | Preparation of Articles of Incorporation |
| ④ | Acquisition of registration certifications for parent company and preparation of affidavits regarding parent company’s profile, representatives’ signatures etc (Attestation of affidavits by a public notary in equity participants’ countries required) |
| ⑤ | Notarization of articles of incorporation by Japanese notary public |
| ⑥ | Application to bank for capital custody and issue of capital custody certificate (Only necessary in case of formation with outside offering) |
| ⑦ | Remittance of capital to account of incorporator or representative director at time of incorporation (In case of formation of formation with outside offering: remittance to special bank account) |
| ⑧ | Appointment of directors and other officers (representative directors, auditors etc) |
| ⑨ | Assessment by directors and auditors of legality of establishment procedures |
| ⑩ | Application to the Legal Affairs Bureau for registration of establishment and registration of official company seal (Date of application becomes date of establishment) |
| ⑪ | Acquisition of certificate of registered information and company seal impression certificate (Approx. 2 weeks following application) |
| ⑫ | Opening of bank account in company name |
| ⑬ | Notification to the Bank of Japan regarding stock acquisition (Depending on the sector this may be required prior to establishment) |
Limited Liability Company
※Time to establish: approx. 2 months after deciding details of company to be established.
| Establishment process | |
|---|---|
| ➀ | Determination of details of company to be established (Incl. trade name, location of head office, business objectives, amount of capital, names of directors and representative directors) |
| ② | Review of identical corporate names at the Legal Affairs Bureau |
| ③ | Acquisition in equity participants’ own countries of: Registration certificates of companies that will become equity participants Preparation of affidavits regarding profiles of companies that will become equity participants and affidavits regarding the signatures of representatives of said companies (Attestation required by a public notary in equity participants’ own countries) |
| ④ | Acquisition in Japan of: Registration certificates for companies that will become equity participants Seal certificates for individuals/companies that will become equity participants |
| ⑤ | Preparation of articles of incorporation |
| ⑥ | Payment by members of investment stipulated in articles of incorporation (to members’ bank accounts) |
| ⑦ | Application to the Legal Affairs Bureau for registration of establishment of Limited Liability Company and registration of official company seal (Date of application becomes date of establishment) |
| ⑧ | Acquisition of certificate of registered information and company seal impression certificate (Approx. 2 weeks following application) |
| ⑨ | Opening of bank account in company name |
| ⑩ | Notification to the Bank of Japan regarding stock acquisition (Depending on the sector this may be required prior to establishment) |
Branch Office
※Time to establish: approx. 1 month after deciding details of branch office to be registered.
| Establishment process | |
|---|---|
| ➀ | Notification to the Bank of Japan regarding establishment of branch office (Requirement varies between industries) |
| ② | Determination of details of branch office to be registered |
| ③ | Review of identical corporate names at the Legal Affairs Bureau |
| ④ | Establishment of branch office (Date of establishment can be decided freely) |
| ⑤ | Preparation of affidavit regarding establishment of branch office |
| ⑥ | Certification of affidavit by embassy/consulate in Japan (If not possible, this procedure may have to be carried out in the country itself) |
| ⑦ | Application to the Legal Affairs Bureau for registration of branch office establishment and registration of the official company seal |
| ⑧ | Acquisition of certificate of registered information and company seal impression certificate (Approx. 2 weeks following application) |
| ⑨ | Opening of bank account in branch office name |
Why Do Business in Japan?
Starting up business in Japan comes with many potential merits. Not only does it demonstrate your clear commitment to the Japanese and broader Asian market – it can also make you an invaluable contact for business partners looking to join you in exploring the opportunities that abound in this dynamic part of the world.
While Japan is often thought of as a very expensive country to live and do business in, things have in fact changed dramatically since the end of the country’s “bubble economy” period in 1992. Since this time, consumer prices have dropped significantly, with large falls in rent and land prices in particular making it a much more welcoming environment for foreign companies and start-ups to find their feet in.
On top of this, recent years have also seen a fall in the costs associated specifically with setting up a company in Japan. For example, the cost for setting up a joint-stock corporation was lowered in 2003 from \10m to a mere \1. The procedures involved have also become smoother, with the process of setting up a company now taking as little as 14 days.
Thinking globally, Japan is also consistently ranked highly for its competitiveness, as indicated for example by the World Economic Forum’s Global Competitiveness Ranking (2019):
- Singapore
- United States
- Hong Kong
- Netherlands
- Switzerland
- Japan
- Germany
- Sweden
- United Kingdom
- Denmark
If you are considering setting up a company in Japan, please do not hesitate to contact us for advice or to hear more about our All-Inclusive Support service.
