For foreign nationals launching a business in Japan, the most important thing is obtaining the “Business Manager” status of residence (commonly known as the Business Manager Visa).
Under the former law, there existed a requirement of “either capital of 5 million yen or more, or the employment of two or more full-time employees,” but under the current permission criteria after legal revision, the legal requirements demanded for business scale are greatly different.
In this article, an experienced Administrative Scrivener well-versed in immigration affairs thoroughly explains “the employee hiring requirements for the Business Manager Visa,” “the method of counting the number of people,” and “the strict requirements demanded” based on the current Immigration Control Act. Foreign managers aiming to start a business in Japan, and corporate personnel supporting them, should read to the end and acquire correct knowledge.
- Employee hiring requirements for the Business Manager Visa (current permission criteria)
- What are the conditions and eligible persons for the “full-time employees” required to be employed?
- About the “Japanese language ability requirement” linked to employee hiring
- If there are employees, is it acceptable to engage in on-site work (manual/operational work)?
- Important requirements of the Business Manager Visa to satisfy in addition to employee hiring
- Academic background (equivalent to master’s or higher) or 3 or more years of business operation / management experience
- Obligation of confirmation of the Business Plan by a specialist (Small and Medium Enterprise Management Consultant, etc.)
- The home-cum-office in principle prohibited (securing of a place of business)
- Frequently asked questions about employee hiring (FAQ)
- For clearing the requirements of the Business Manager Visa, consult an Administrative Scrivener
Employee hiring requirements for the Business Manager Visa (current permission criteria)
To obtain the Business Manager Visa and legally manage a company in Japan, you need to satisfy strict criteria concerning the scale of the business.
Both “capital of 30 million yen or more” and “employment of one or more full-time employees” are mandatory
Under the current law, as the business scale requirement, satisfying both “capital / total investment of 30 million yen or more” and “employment of one or more full-time employees” is obligated.
It is no longer a system where, as before, you could choose either capital or employment. Having “sufficient capital strength,” and on top of that, “creating at least one or more jobs” for the Japanese labor market, has become an absolute condition for obtaining the visa.
What are the conditions and eligible persons for the “full-time employees” required to be employed?
“If we hire one or more employees, can anyone satisfy the requirement?”—the answer is no. The definition of “full-time employee” under the Immigration Control Act is set very strictly.
Eligible persons are limited to Japanese nationals and foreign nationals on “status-based visas”
Those who can be counted as “full-time employees” obligated as a business scale requirement for the Business Manager Visa are, as a rule, limited to those who satisfy the following conditions.
- Japanese nationals
- Special Permanent Residents
- Foreign nationals residing under the following statuses of residence (status-based visas)
- Permanent Resident
- Spouse or Child of Japanese National
- Spouse or Child of Permanent Resident
- Long-Term Resident
Because these people have no restrictions on work activities in Japan, they are recognized as countable as the company’s full-time staff.
Foreign nationals on work visas (Appended Table I of the Act) are excluded from the number requirement
What should be noted most here is the point that foreign nationals holding so-called “work visas (Appended Table I of the Act)” are not counted in this “one or more full-time employees.”
For example, no matter how many systems engineers holding the “Engineer/Specialist in Humanities/International Services” visa or foreign chefs holding the “Skilled Labor” visa you hire as regular employees, this will not satisfy the “full-time employee employment obligation” as a business scale requirement.
You must always employ at least one person on a full-time basis from among “Japanese nationals or persons holding status-based visas” mentioned above.
About the “Japanese language ability requirement” linked to employee hiring
As an important legal requirement closely related to employee hiring, the “Japanese language ability requirement” exists. To smoothly conduct business in Japan and comply with the rules, a certain level of Japanese language ability is required of the management and key staff.
Either the applicant or a full-time employee needs a considerable level (B2 level) of Japanese language ability
Under the current criteria, it is required that either “the applicant (the manager themselves)” or “a full-time employee” have a considerable level of Japanese language ability. If the manager themselves cannot speak Japanese, you must always employ a full-time employee fluent in Japanese and put in place a system that can support operations.
Note that in the previous section we explained that “foreign nationals on work visas are not counted in the employment number requirement,” but only for the full-time employee for the purpose of satisfying this “Japanese language ability requirement,” foreign nationals on work visas (Appended Table I of the Act) are also included as eligible persons.
Specific criteria for proving Japanese language ability
The required “considerable level of Japanese language ability” is defined as B2 or above in the “Reference Framework for Japanese Language Education.” To prove this for those other than Japanese nationals or Special Permanent Residents, the submission of objective materials is required. Specifically, you need to satisfy one of the following.
- Having received certification of Japanese-Language Proficiency Test (JLPT) N2 or above
- Having obtained a score of 400 or more in the BJT Business Japanese Proficiency Test
- Having resided in Japan for 20 years or more as a Mid-to-Long-Term Resident
- Having graduated from a higher education institution such as a Japanese university
- Having completed Japanese compulsory education and graduated from high school
If there are employees, is it acceptable to engage in on-site work (manual/operational work)?
Even if you have set up a business structure by hiring employees, you must not misjudge the essential activity content of the Business Manager Visa.
The strict boundary between the actual activity of “Business Manager” and on-site work
The Business Manager Visa is, as its name indicates, a status of residence for “operating” or “managing” a business. If the actual activity as a manager is not sufficiently recognized, the visa will not be approved.
For example, when operating a restaurant, if the company president themselves takes on most of the on-site work (manual/operational work) such as cooking in the kitchen or serving customers in the dining area, it will not be regarded as a “management activity,” and the risk of denial becomes extremely high.
The importance of appropriate staff placement and employment contracts
In the case of a business model that involves on-site work, such as a restaurant or a massage shop, you must place an appropriate number of staff so that the store can operate even without the manager engaging in on-site work.
When applying to Immigration, in order to prove this, you need to prepare employment contracts and shift schedules and logically explain that the manager’s actual activity is in an environment where they can devote themselves to “management.”
Important requirements of the Business Manager Visa to satisfy in addition to employee hiring
Under the current Business Manager Visa, there are also requirements to clear other than capital and employee hiring. Be sure to firmly grasp the following important points as well.
Academic background (equivalent to master’s or higher) or 3 or more years of business operation / management experience
As a requirement that questions the applicant’s qualifications as a manager, the applicant themselves needs to satisfy one of the following.
- Having obtained a degree equivalent to a master’s or higher (doctoral, master’s, or professional degree) related to business management or the field of the business.
- Having 3 or more years of work history in business operation or management.
Obligation of confirmation of the Business Plan by a specialist (Small and Medium Enterprise Management Consultant, etc.)
For the “new Business Plan” submitted at the time of the status of residence decision, in order to evaluate that the plan has concreteness and rationality and is feasible, confirmation by a person with specialized knowledge of business management is obligated.
This specialist specifically refers to a “Small and Medium Enterprise Management Consultant,” “Certified Public Accountant,” “Tax Accountant,” and the like. Preparation of a Business Plan that has received objective evaluation by a specialist is indispensable.
The home-cum-office in principle prohibited (securing of a place of business)
In order to carry out appropriate management activities according to the business scale, “combining your home with a place of business” is, as a rule, not recognized. It is required to secure a place of business (office or store) dedicated to the business and clearly distinguished from the residential space.
Frequently asked questions about employee hiring (FAQ)
Are officers (such as directors) counted in the number of “full-time employees”?
As a rule, they are not counted. “Full-time employee” under the Immigration Control Act refers to an employee who works under an employment contract with the company. Because officers are on the side engaged in management, they are not calculated within the employee count. Separately from the management, it is necessary to secure pure employed staff.
For clearing the requirements of the Business Manager Visa, consult an Administrative Scrivener
We have explained the requirements of the current Business Manager Visa. “Capital of 30 million yen or more,” “employment of one or more full-time employees,” “a master’s degree or 3 or more years of management experience,” “the Japanese language ability requirement,” “confirmation of the Business Plan by a specialist,” and so on—the legal hurdles to satisfy span a wide range.
If you swallow whole the outdated information on the internet and proceed with preparation in your own style, there is a risk that even after starting your business, the visa will be denied.
At our office, based on the latest immigration laws and regulations at all times, we provide visa acquisition support fully conforming to the current criteria. Leveraging our network of partner specialists, we also support, end-to-end, everything from Business Plan preparation, company establishment, to the visa application.
If you have concerns such as whether you can satisfy the requirements in your own situation, or how to hire employees, please first make use of our office’s free consultation. A specialized Administrative Scrivener will propose the optimal roadmap.
