How do foreigners set up a company in Japan? Explanation of Procedures and Required Documents

What is required for a foreigner to establish a company in Japan

What procedures are required when a foreigner establishes a company in Japan?

The procedures for establishing a company are basically the same whether you are Japanese or foreign The procedures for establishing a company are basically the same whether you are a Japanese or a foreigner. Foreigners with any status of residence are eligible to establish a company in Japan.

What kind of status of residence allows me to manage a company?

However, it is a different story when it comes to the stage of actually conducting management activities after the company is established. Depending on your status of residence, you may not be able to manage the company.

Among work-related statuses, “technical, humanities, international services” and “special skills” statuses, which require employment by public or private organizations, are not permitted to engage in managerial activities.

Foreigners who stay in Japan with “College Student” or “Family Visa” status are also not allowed to manage a company. If they engage in company management with these statuses, they will be considered to be working illegally. Therefore, it is necessary to apply to the Immigration Bureau to change your status of residence to “business administration. (Hereafter, the status of residence “business administration” is referred to as a “business administration visa.)

Foreigners with the status of “spouse or child of Japanese national,” “permanent resident,” “long term resident,” or “spouse or child of permanent resident” have no restrictions on employment, so they can manage a company with the same status of residence.

Can I run a company in Japan while living abroad?

It is possible for a foreigner residing abroad to establish a company in Japan. Therefore, it is not impossible to manage a Japanese company while continuing to live abroad.

Nevertheless, If a foreigner wishes to receive remuneration from a Japanese corporation to conduct management activities in Japan, a business administration visa is required, even if his/her stay in Japan is short. A foreigner residing abroad is not required to have a temporary visitor’s visa. A foreigner residing abroad cannot manage a Japanese corporation by repeatedly coming to Japan on a temporary visitor visa. In addition, if the representative does not reside in Japan, it will be difficult to open a corporate account in Japan.

Given the above, it is best to consider that it is quite a hurdle to run a company in Japan while living abroad.

Flow of Establishing a Company

The process of incorporating a company is as follows

(1) Preparation and certification of articles of incorporation

The document that describes the basic matters of the company is called the “articles of incorporation. Items that must be included in the articles of incorporation include the company name, business purpose, location of the head office, names of incorporators, and the total number of shares authorized to be issued.

Once the Articles of Incorporation are prepared, take them to the notary public office with jurisdiction over the location of the head office for certification. Please note that certification of the articles of incorporation is required only for joint stock companies, and is not required for limited liability companies.

A personal seal and a certificate of seal impression are required for certification of the Articles of Incorporation, but if you do not have a certificate of seal impression, a signature certificate can be substituted. If you live overseas and do not have a seal culture in your country, please prepare a signature certificate.

Foreigners staying in Japan for medium to long term can register their personal seals at the municipal office. If you are already living in Japan, you should take this opportunity to register your personal seal for future company management.

➁Payment of capital

The capital is paid into the personal account of the promoter. Payment must always be made after the date of the Articles of Incorporation.

Which bank accounts can be used for payment of capital? Japanese banks (domestic and overseas branches) or accounts at Japanese branches of foreign banks. If you are a foreigner already living in Japan, there is no problem. If you are a foreigner already living in Japan, there is no problem, but it is very difficult for a foreigner with no address in Japan to open a bank account in Japan. Therefore, one bottleneck for foreigners residing abroad is to prepare a bank account. It is common to ask someone residing in Japan to help.

Registration of incorporation of ➂ company

The Legal Affairs Bureau will register the incorporation of the company. By this time, the company’s registered seal must have been created. The date of application for registration is the date of incorporation.

(4) Notification to tax offices, etc.

Various notifications are made to the tax office, city hall, pension office, etc. In the case of businesses that require permits and licenses, we will also obtain the permits and licenses from the regulatory authorities at this time.

 

This completes the procedure for establishing a company. The next step is to obtain a business management visa.

To obtain a business administration visa, the company must have completed its registration of incorporation and obtained the necessary permits and approvals at the time of application (*except for the 4-month business administration visa). Therefore, the order is Company establishment first, visa application second. after the visa application.

Requirements for obtaining a business administration visa

To obtain a business administration visa, the following requirements are required

Of these, the “➂ business size above a certain level” requirement requires that the amount of capital be at least 5 million yen or that two or more full-time employees be engaged in thebusiness.

Since it is often cheaper to prepare 5 million yen than to hire two employees, it is common to apply for a visa with 5 million yen in capital.

Establishing a company can be done with a capital of 1 yen, but in principle, to obtain a business management visa In order to obtain a business management visa, you need to prepare 5,000,000 yen in capital. Please keep in mind that the capital of 5 million yen is required to obtain a business management visa.

Can I also get a loan from a bank?

If you are short on funds, consider obtaining a loan from a bank. It may be difficult to borrow the entire amount of capital from a bank, but it is conceivable that you could, for example, provide about half of the capital with your own funds and raise the other half from a bank. However, this assumes that you have a compelling business plan.

Required Documents for Business Administration Visa Application

When applying for a business management visa, a business plan must be submitted. The business plan is an extremely important document for the Immigration Bureau to determine “➁ continuity and stability of the business.

In addition, the applicant is required to submit documents showing the actual existence of the business office, such as photographs of the office (building exterior, entrance, mailbox, and inside the office) and a lease agreement. These are the documents pertaining to “(1) Securing a Place of Business.

In addition, a resume of the applicant, documents explaining the formation process of the capital contribution, a certificate of company registration, a copy of the articles of incorporation, a copy of the minutes of the shareholders’ meeting that resolved the compensation of directors, and a copy of the certificate of payment of the capital are also required. In addition, any contracts or agreements you have signed with suppliers or business partners will be advantageous to the screening process.

Cost of obtaining a business administration visa

The cost of incorporation includes a registration tax of 150,000 yen (60,000 yen for a limited liability company) to be paid to the Legal Affairs Bureau for registration of incorporation. In addition, a 30,000-50,000 yen fee for certification of the articles of incorporation must be paid to the notary public (no fee for limited liability companies).

The cost of establishing a company, in addition to the above and other expenses, ranges from 250,000 yen for a joint stock company and 100,000 yen for a limited liability company.

In many cases, the 5 million yen in capital will be more of a bottleneck than the cost of establishing a company when applying for a business administration visa. The source of the 5 million yen will also be checked during the examination, so you will need to prepare documents that explain how you raised the 5 million yen. If you are borrowing from an acquaintance, it is important to have a solid loan agreement in place.

Please consult with an administrative scrivener to obtain a business management visa.

When applying for a business management visa, it is important to make sure that the points to be examined are taken into consideration. In particular, you must prepare a business plan that is convincing enough to convince the Immigration Bureau. In addition, the preparation of articles of incorporation is also considered to be extremely difficult for foreigners.

If you have any concerns about visa applications or company incorporation procedures, we recommend that you first consult with a highly specialized administrative scrivener.