The Japanese government has introduced various business-friendly policies including tax benefits and intellectual property regulations, developed high quality infrastructure, initiated a simple incorporation process, and more with an objective to attract foreign direct investment to the country. In this article, we highlight 11 steps that you will be required to undertake to register company in Japan.
How do I register my company in Japan?
For a smooth and hassle-free registration process, you need to understand the steps that you will be required to undertake, which include the following:
Step 1: Choosing an optimum business structure:
- You must first decide on a suitable legal entity for your business. Some of the available business structures include the following:
- Sole Proprietorship (Kojin Jigyo)
- General Partnership (Gomei Kaisha)
- Limited Partnership (Goshi Kaisha)
- Limited Liability Company (Kabushiki Kaisha- KK)
- Joint Stock Company (Godo Kaisha- GK)
- Branch Office (Shiten)
- Representative Office (Chuzajin Jimusho)
- Japanese Free Zone Company
- Each business entity has different requirements that businesses need to meet.
- You will need to decide on a suitable business entity based on your business activities, requirements, long-term business goals, and more.
Step 2: Reserve your preferred business name:
- You must first check for the availability of your preferred business name and reserve it with the Registry Office.
- The name that you have chosen should not be vulgar, misleading, or offensive
Step 3: Meet all the requirements of your chosen business entity:
- You must then ensure that your business meets the government requirements including the following:
- Business must have at least one director and shareholder each
- Business must have a local registered office address
- Business must have a local resident director to represent the business in Japan
- There is no minimum paid-up capital
- Even though there is no minimum paid-up capital requirement, you will need to deposit an initial share capital into your corporate or personal bank account of the resident director / third party.
Step 4: Prepare all the required documents:
- You must also prepare all the necessary documents needed for the incorporation of your business including the following:
- Power of Attorney assigning the business a local resident director
- Proof that paid-up capital is deposited in the bank
- Articles of Incorporation (teikan)
- Business’s official seal
- Personal information of the directors and shareholders
- Other incorporation documents
- The documents must be in Japanese, which is the official language in Japan.
- The above- mentioned documents need to be notarised with the Notary Public’s Office (Koshonin Yakuba) in the region where your business is to be located.
Step 5: Register your business:
- You will then be required to register your business with the Japanese Legal Affairs Bureau (Homukyoku).
- After the government provides its approval, you will receive the Registry Certificate, Seal Certificate (inkan), Memorandum and Articles of Association, and more.
- These documents will be in Japanese and therefore, you may need to use a translation service to have the document in your preferred language.
Step 6: Register your business for tax:
- Once you have incorporated your business, you will need to register your business for tax with the National Tax Authority.
- You will receive a tax registration number, which you will need to conduct your business activities.
Step 7: Apply for business licenses, permits, or approval:
- Depending on your business structure and activity, you will also need to obtain required business licenses (menkyo), permits (Kyoka), or approval (shounin) with the relevant authorities (depending on your business activity).
- For example: Businesses in the financial sector are required to apply for a business license with the Local Finance Office after which the Financial Service Agency (FSA) will review and give the necessary approval.
- Some of the sectors in which licenses are required include the following:
- Real Estate Industry
- Food and Beverage Industry
- Financial Services Industry
- Pharmaceutical Industry
- Cosmetics Industry
- You need to thoroughly check if you are required to have a license or not. This is because conducting your business in Japan without obtaining the necessary licenses will result in the business being subjected to various fines and penalties along with a risk of being shut down completely.
Step 8: Apply for a business visa:
- If you wish to travel to Japan and work from there, you will need to apply for a suitable visa. Some visas that are available to foreign investors and business owners include the following:
- Start up visa
- Investor visa
- Business manager visa
Step 9: File for insurance:
- If you are planning on recruiting, you must also file for labour insurance with the Labour Standards Inspection Office.
- You must also establish rules of employments as soon as your business hires more than ten individuals as employees. You must include the rules regarding when employees need to work extra hours or on public holidays.
- You may be required to file for other insurances including health insurance, employment insurance, and more.
Step 10: Open a corporate bank account:
- You will need to open a corporate bank account for your newly incorporated business.
- Some of the banks you can open your bank account with include the following:
- Mizuho Bank
- Sumitomo Mitsui Banking Corporation (SMBC)
- Shinsei Bank
- Seven Bank
- Once the set up process is completed, you will receive a banking token along with an access code, needed for internet banking.
- The initial paid-up capital of your business needs to be transferred to your newly opened corporate account.
Step 11: Staying compliant with the government policies:
- Once registration is completed, you will need to continue to ensure that your business is compliant with the government policies.
- You will need to prepare your business’s financial statements, file your tax returns annually, and more.
The entire incorporation process should be completed within a period of four weeks. Opening a bank account with a reputable bank may also take a period of four weeks. All in all, your business should be in operation within a period of eight weeks.