How will my immigration status impact my plans to start and run my own company in Japan?

July 8, 2018

Today, foreign nationals can launch their own business in Japan, even if they are not residents. While acquiring legal residency status is highly recommended for practical purposes, it is not necessary if you do not need to be in Japan for more than 90 days at a time, and if you can open a personal bank account for the initial incorporation. However, if you do plan on taking over as the representative director and you want to stay in Japan to run your company, then becoming a legal resident through an appropriate resident visa is required.

Will the successful incorporation of my company ensure my legal residency status?

It is important to remember that the establishment of your company and your residency status are two separate issues under Japanese law. Some foreign nationals are only interested in owning a profitable company, which does not in principal require residency or direct day-to day involvement. This is fine as once your company is incorporated it can be maintained solely by foreign directors, and you may frequent Japan on a visitor basis as long as it less than 90 days as a total throughout the year.

However, your immigration status will matter if you want to stay in Japan to personally run your company. If you are staying on a visitor basis and are over the 90 day threshold per year (even if it nonconsecutive), there is a chance that immigration will revoke you the next time you come into Japan. Also, if your long-term resident visa is in application and is not approved, you will have to return to your home country within 90 days from your date of entry.

You can appoint yourself as a local representative director once you have obtained a resident visa that allows business activity . That said, there are important distinctions that must be taken into consideration, because the type of long-term visa you have can preclude you from assuming the directorship of your business. For example, if your current long-term visa falls under the “limited authorized activities” category (such as Engineer / Specialist in Humanities / International Services/Skilled Labor), then you cannot appoint yourself to the directorship until you change your visa to the correct classification. In this case, the right visa would be a Business Manager, or family related visa if you are the spouse or child of a Japanese national or permanent resident.

Getting your Investor/Business Management visa

To qualify for this type of visa, you must:

• Have already completed the registration/incorporation of your company
• Have a physical office space
• Have at least 5 million yen in investment capital or have at least 2 full-time employees residing in Japan.
• Also, it is recommended to have at least 3 years of experience in Business Management or Administration, including graduate studies. However, this can be waived under certain conditions.

Securing office space can be quite difficult if you are not a legal resident, but you do have options. Now there are several serviced offices that welcome non-residents, have services in English, and do not require local guarantors. In some cases, you may also be able to use your residence as your office for visa application purposes as long as it fulfills certain requirements. Some landlords may be willing to lease an office space with a large enough deposit. You can also instruct your company’s representative director to negotiate and secure a commercial lease on your behalf. Before making your final decision, it is strongly advised that you consult with an immigration specialist so you do not waste money leasing a space only to find that does not meet the visa requirements.

The visa approval process can take some time, which usually takes about 3 to 4 months to complete. In some cases, it may take up to 6 months and additional. To avoid any unnecessary delays in your visa application, it is highly recommended that you consult with an immigration professional to prevent any mistakes with your documentation and paperwork.

Navigating Japan’s business landscape as a foreign national

Though Japanese regulations can seem overwhelming and perplexing to international investors, the opportunities for profit and success are ripe for the taking with the right knowledge and preparation. As one of the leading providers of corporate, legal, and accounting services in Japan, international investors have come to trust RSM Shiodome Partners with:

• Guidance for successful company incorporation
• Assistance for smooth and error free visa application
• Providing quality corporate support services such as accounting, legal, tax, payroll, translation, and more