Here we introduce to foreign individuals the flow of establishing a corporation in Japan.

For foreigners who will start their business in Japan

For foreigners who will start their businesses in Japan, there are four ways of doing this:

1. Incorporating a Japanese corporation (subsidiary)
2. Incorporating a Japanese branch office
3. Establishing a Japanese representative office
4. Entering Japan using a short-term business visa

A Japanese corporation is basically a regular corporation whose head office is in Japan and performs sales activities as a Japanese company.

A branch office is a branch or sales office set-up and registered in Japan by a foreign entity. Its primary purpose is to perform continuous business activities in Japan.

Representative offices usually engage in preparations for a possible expansion into Japan as a subsidiary company or branch office. These include activities such as information gathering, advertisement/publicity, procurement of goods, market research and so on.

It is best to choose from among the four methods we have enumerated above based on what you aim to accomplish and do in Japan. Our team will work with you to determine which method will be most appropriate for you to start your business and establish it in Japan. What we often recommend to our clients is to establish (incorporate) a company in Japan before proceeding with business activities.

Standard Incorporation Procedures for Stock Companies

【1】Decide on important company matters
Decide on the important details regarding your company, such as your trade name, head office location, purposes to be indicated in your articles of incorporation, capital, and executives. When incorporating a joint-stock corporation (kabushiki kaisha) in Japan, at least one representative director, at least one of the representative directors must be residing in Japan. This means that if all directors reside overseas, incorporation cannot be done.

【2】Creation and certification of articles of incorporation
Aside from the information indicated in number 1 with regards to the articles of incorporation, you will also need to decide on other details such as number of issued shares and fiscal year-end. Once the articles of incorporation are completed, it needs to be certified at a notary public.

Regarding the impressed seal and seal certificate that should be attached when submitting the certified articles of incorporation, foreign nationals who already registered residents in Japan with registered seals should have no problems obtaining their certificates, as they can obtain these just like any other Japanese national.

In relation to this, if foreign nationals residing overseas will be either an investor or director of the company, they will need for furnish either a seal certificate (if their home country has a seal system in place) or a signature certificate duly issued and certified by an officer of their home country.

【3】Remittance of paid-in capital
Remittance of the company’s capital (capital contribution) is done through an incorporator (investor)’s bank account. Capital of contribution must be done through a bank (financial institution) that has been approved by Japan’s Financial Services Agency. Please note that capital contribution cannot be done at bank accounts from other countries.

【4】Preparation of additional documents
Other documents necessary for registration of incorporation, such as a letter of approval for the appointment of directors, proof of capital contribution, and a certificate regarding the recording of the amount of capital must also be prepared.

【5】Application for registration of incorporation
Once you have all the documents, you can apply for registration at the Legal Affairs Bureau with jurisdiction over your company.

Looking at the process, it may be difficult for foreign nationals to set-up their business in Japan. The Shiodome Partners Group can handle all work related to company establishment. Additionally, through our use of the electronic notarization system for articles of incorporation, you can save 40,000 JPY as you will no longer need to affix the revenue stamp.

Please feel free to contact us. Please see our Incorporation Services page for more details.

We hope you will let Shiodome Partners Group help you in your business endeavors in Japan.