Should the Representative Director for the Japanese Entity also be a Director in the Foreign Corporation

November 1, 2019

Question:

Is it necessary the representative director of a Japanese corporation be a director in the foreign entity?

Answer:

No, it is not.

Explanation:

“When a Foreign Company intends to carry out transactions continuously in Japan, it must specify its representatives in Japan” (Companies Act, Article 817 (1)).

There is no requirement that the Japanese entity’s representative(s) should also be a director in the Foreign Company. Furthermore, they also do not have to be the Foreign Company’s directors, managers, or even employees; this makes it possible for the company’s proxy to become a representative in Japan.

This also does not restrict the Foreign Company’s directors, managers, or employees from becoming a representative in Japan.

However, at least one representative in Japan must have an address in Japan (Companies Act, Article 817 (1)).