Possibility of Bank Account by a Representative Office in Japan

November 27, 2019

Question:

Can a representative office open its own bank account？

Answer:

If a representative office wishes to open bank account, it cannot be named under the representative office itself. As such, it should be under the personal account of the Representative Director of the office.

Explanation:

Though a representative office in Japan cannot perform sales activities that result in revenue, it would still incur expenses as a result of the actual operation of the representative office. The costs of operating the office would generally be covered by the corporate headquarters in the company’s home country. Therefore, to be able to receive funds remitted by the headquarters used to cover for the operational expenses of the representative office, as well as manage the received funds, offices will need to open a bank account at a Japanese financial institution.

However, in the case of a representative office, it is not possible to open a bank account under its name. This is because in order to open an account under the name of an organization, it is necessary for both Japanese and foreign corporations to have separate “legal personalities”. Recall however that a representative office is not recognized as a corporation in Japan ― although it is a branch of the foreign corporation, it cannot be recognized as though it is the foreign corporation itself.

As a result, representative offices often open bank accounts using the name of their representative director. Even if it is a personal account, the office/company name can be used as the “doing business as” name. In order to distinguish its use as the representative office’s account (as opposed an ordinary personal account), the account is commonly named using the office name and the personal name of the representative together, such as “(Representative Name), (Company) representative office”.

Generally, the representative office will need to provide the following documents when opening a bank account:

• Representative’s passport
• Representative’s resident card (if foreigner)
• Company profile or company brochure
• A copy of office space lease contract
• Bank seal

Take note that since the documents required by each financial institution may differ, (some may ask for additional requirements aside from the person’s ID card, like information on the headquarters in the home country or the relationship between the main office and the representative office), it is best to confirm the details directly with the financial institution.