Where will be the location of the head-office or offices used in the application for the business management visa in Japan?

Regarding the clarification requirement for the standard of the immigration status of the alien entrepreneur

In case of making reviews with respect to the location of the head-office or offices of the company during the course of applying for the business management visa （or the investment management visa）, the article with title “Regarding Clarification of the Residence Status Standard of the Alien Entrepreneur”（By Immigration Bureau, Ministry of Justice; dated August 2005） will be one of the guidelines for that purpose.

In these Guidelines, some guidelines are shown with respect to the requirement “For such facility as is to be used as the place of business for the purpose of operating a business in Japan to be secured /reserved in Japan” or “For such facility as is to be used as the place of business for the purpose of operating a business in Japan to exist in Japan”.

What does “securing/reserving a place of business” mean?

Just like as the case examples consulted with us, there are many cases for such foreign companies, which created many kinds of venture companies starting with IT businesses, to utilize the incubation offices and to perform their businesses by setting the facilities which they use for dwelling purpose as their place of business due to the facts that, as a matter of course, the scale of their operation is small when initially incorporated and the business operation by small number of personnel can be done, which facts themselves are extremely natural.

Now, in the Section 2 of the General Principles of the Japan Standard Industry Classification set forth by the Ministry of Internal Affairs and Communications, the word “the place of business” is defined as follows:

・ For any of the economic activities is being performed under a single management by possessing a certain area i.e. one (1) section ; and
・ For production or supply of commodities and services to be continuously performed having personnel and facility

If and in case when the above-written 2 requisites are met, it is expected that the requirement “The place of business is secured (exists)” is expected to have been cleared, however, as for the business activities to be performed under the business management visa （or the investment management visa）it is not permitted to utilized such space for the short term lease for 3 months or less due to the requirement for continuity and stability of the business.

Therefore, if and in case when the so-called virtual office, address lending, co-working space, apartment rented by the week, apartment rented by the month, and etc. are used as the office of the business, the requirements for the examination process for the business management visa（or the investment management visa） are judged to have not been satisfied.

Further, if and in case when the stall and etc. which are easily disposed of are utilized, the requirements for the examination process for the business management visa（or the investment management visa） are judged to have not been satisfied.

Points of attention to be paid to the lease contract for the place of business

With a few exceptions of alien wealthy people and foreign large enterprises, it is popular that those aliens and foreign corporations who start their businesses in Japan rent their places of businesses. On such occasions, enough attention should be paid to the execution of the lease contract when it is implemented.

First of all, in such lease contract relating to the lease property, it is necessary for the intended purpose thereof to be clearly and specifically written in such way as “for business use”, “for shop use” or “for office use”. .And next, with respect to the party to such lease contract, it is necessary for the contract to be entered into under the name of the Japanese corporation and etc. and for the lease property to be used by the Japanese corporation and etc.

If and in case when the business is to be operated by means of using a part of the property being rent for use for a dwelling house as the office, it is necessary that the following requisites are satisfied:

● Requisites to be met on the side of lesser of the property

・For the lesser to have permitted such use of the property as the use other than for the residence purpose, in other words, for the lesser to have agreed that the property is to be subleased for the use for the place of business by and between the lessee and the Japanese legal entity and etc.;

● Requisites to be met on the side of the lessee of the property

・For the Japanese legal entity and etc. to have permitted the property to be used as the place of business; and

● Other requisites

・For Japanese legal entity and etc. to have such room as possessed for the business purpose being equipped with the facilities where any business is to be performed;
・For the arrangement agreed with respect to the payment of the “common-use expenses” such as the public utility charges required for said property to have been clearly defined; and
・For any social sign similar to a signboard to have been hanged out.

Handling of the Incubation Office

In case when any group or organization which either provides management advices to any venture enterprise or mediates to such business services and etc. as are necessary for any enterprise operation, the so-called incubator is assisting the business, if and when the applicant for the business management visa （or investment management visa） has submitted the written acceptance of the use relating to the place of business, it is determined that the temporary address or place of business of （Independent Administrative Agency） Japan External Trade Organization (JETRO) Invest Japan Business Support Center (IBSC) and any other Incubation Office and etc., if what is temporarily lent as a business office for the purpose of incubation is secured, may be deemed and treated as if it will satisfy the requirement of “reservation (existence) of the place of business”

In light of all of the above written, although it is difficult for a mere virtual office, address lending, co-working space, apartment rented by week, apartment rented by month, and etc. to meet the requirement of “reservation (existence) of the place of business”, we can understand that the above-written incubation office would satisfy such requirement. Further, speaking of such rental office provided by Serve Co-op and Lee JAS and etc., since it depends on case by case, I cannot simply say such arrangement, but　I suspect there would be such case when it satisfies the requirement of “reservation (existence) of the place of business”

Cases in which the places of business were deemed to have been secured

Several Case Examples are published in and by the article having its title “Regarding the clarification of the standards of the immigration status of the alien entrepreneurs”（issued in August, 2005, by Ministry of Justice the Immigration Bureau）. Here, I would like to refer to and introduce said Case Examples as follows:

Case Example 1 : In case when the office of a restaurant was its home-cum-office

In connection to his/her schedule for him/her to run a privately owned restaurant in Japan, A made an Application for Amendment of the Immigration Status, and, although the purpose of use of the property which was to be the new office, described in the lease agreement therefor, was set as “residence”, but due to the fact that a special agreement had been executed with the lessor under which the property was to be used for “the office of the company”, the place of business was deemed to have been secured/ reserved.

Case Example 2 : In case when a property has been leased by a branch office

In connection with his/her schedule for him/her to import and export the marine products and operate a processing and sales business for such products in Japan, B made an Application for Delivery of Certificate of Eligibility for Resident Status, and on the other hand, although the head office was the residence house of an officer of the company, due to the fact that a rent had been arranged by and under the name of the branch office for a property owned by the commerce and industry association, the place of business was deemed to have been secured/ reserved.

Case Example 3 : In case when each of the company and the office has separate entrance at the same property

In connection with his/her schedule for him/her to establish a joint stock company and operate a selling business , C made an Application for Delivery of Certificate of Eligibility for Resident Status; The entrances to the company office and to the residence area were separate respectively, and a sign showing the company name was placed at the entrance to the office. And further, it was confirmed that the business itself was being operated and office equipment such as personal computers, telephone receivers, desks, copiers and etc. were equipped, and then the place of business was deemed to have been secured/ reserved.

Cases in which the places of business were not deemed to have been secured

Case Example 1 : The case where the portion of the office at the home-cum-office has been deemed to have no substance

In connection with his/her schedule for him/her to establish a limited liability company and be engaged in operating such business, D made an Application for Permit of Renewal of Period of Stay.

As the investigation was made since the office was supposed to be D’s residence house, it was found that no signs etc. clearly showing the existence of the place of business was put at the mailbox or the entrance, no facility and equipment necessary for business operation were put in the room as well, no payroll and attendance book did not exist, and only things that existed in the room were daily living articles, and thus the place of business was not deemed to have been secured/ reserved.

Case Example 2 : The case where the portion of the office at the home-cum-office has been deemed to have no substance

In connection with his/her schedule for him/her to establish a limited liability company and operate a general sales agent in Japan, E made an Application for Delivery of Certificate of Eligibility for Resident Status.

Based upon the materials submitted, as the investigation was made since the place of business was supposed to be a residence house, the building was a 2 story apartment house, no signs etc. showing the name of the company at the mailbox and the entrance, and no office machines and etc. were set up in the room as well, and only furniture and living fixtures and etc., existed, and thus the place of business was not deemed to have been secured/ reserved.

Case Example 3 : The case where the office is the dwelling house under the name of an employee and deemed to have no substance

In connection with his/her schedule for him/her to establish a limited liability company and operate a design company in Japan, F made an Application for Permit of Amendment of the Immigration Status.

Based upon the materials submitted, the place or building was not held under the name of the legal entity nor under the name of the entrepreneur but was used under the name of an employee as his/her residence, and the heating and also payment for the lighting expenses for the place or building was made under the name of such employee and further no verification could not be made for the agreement of the lesser showing that said property may be able to be used for any other purpose than dwelling purpose, and thus the place of business was not deemed to have been secured/ reserved.