201501.04
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Visa acquisition in Japan

satoru-kobayashiToday, we would like to introduce and explain the way how an alien to acquire a business management visa (or an investment management visa) in Japan.

In order for an alien entrepreneur to start a business, it is the procedure of applying for the “business management visa (or the investment management visa)” that is as important as the procedure of incorporating a Japanese legal entity. This time, I would like to explain the procedure for an alien to acquire the management visa (or the investment management visa) in Japan.     

1.What does a business management visa (or an investment management visa) mean ?

If and when any alien entrepreneur sets up a new business by making investment to Japan, or, gets engaged in the investment to any existing enterprise and the operation or management of such enterprise, such activities are to fall under the immigration status of the “business management (or investment management)”.

These are the activities of the personnel who are getting involved in and performing such businesses as deciding important matters relating to the operation of the business of the Japanese legal entity and the execution or auditing of the business, and, speaking of the concrete examples thereof, a representative director, a director, an auditor, a manager, a plant manager, a branch manager and etc. are those who fall under the same, all of whom are either entrepreneur or administrator of any business.

Therefore, any and all aliens who are going to launch a business in Japan by doing his/her effort such as incorporating a company are required to acquire the immigration status of the investment and/or the operation, i.e. the so-called “the business management visa (or the investment management visa)”, provided, however, that any and all activities which need such qualifications as are required for any legal or accounting services are excluded from this requirement.

passportusAs for the business management visa (or the investment management visa), it is not such for you to be able to automatically obtain or acquire if and when you have incorporated a company in Japan, but it is necessary for you to verify and show the stability as well as the continuity of the company incorporated and its business, and, as the result, to prepare the relevant reasonable business plan. As for such business plan, please refer to “Regarding Preparation Of Business Plan Necessary For Any Alien Entrepreneur To Acquire Business Management Visa (or Investment Management Visa)”.

Further, be sure, any of such directors and etc. who do not fall under the definition of those who either make decision on important matters of the Japanese legal entity or execute the business (such as nominal officers and part-time executives)is required to apply for not a business management visa (or an investment management visa) but a visa for “the specialist in humanities, and international services”.

2. Flow of the application for a business management visa (or an investment management visa)

The flow of the application for a business management visa (or an investment management visa) is generally set up as follows:

(1) Securing of an office, the place of which is to become the location of the head office of the company ;
(2) Incorporation formalities of the company and procedures of notifications to the competent tax office and etc. after incorporation ;
(3) Securing of the store property and interior finishing (in case of operation made at store) ;
(4) Application for any and all operating permissions required for the business (in case of the business for which such permissions are required);
(5) The procedure for employing employees and the procedure for joining the Employment Insurance (if and in case when employing any employees prior to the application for the required operating permissions) ;
(6) Preparation for visa application documents and application therefor to the competent Immigration Bureau ;
(7) Acquisition of the required business management visa (or investment management visa) .

Detailed explanations for the above flow (1) through (7) are as follows:

(1) Securing of an office, the place of which is to become the location of the head office of the company

With respect to this point, it is the requirement to secure or reserve an office separate and independent from the residence, as a general rule. There are such cases where exceptionally permitted even if it is a home-cum-office, only if it is in such environment where the business can be engaged in a stable condition including the case where the space for the food, clothing and shelter and the space for the office are respectively separate and independent from each other.

With respect to this point, please refer to the explanation under the title ”How to set up and secure the location of the head office and the offices for the application for the business management visa (or the investment management visa) ? “.

(2) The procedures for a company incorporation and the procedures for notifications to the competent tax office and etc. to be made after the company incorporation

8434At first, you incorporate the joint stock company and etc. with the capital of five 5 million yen or more. As for this amount of five 5 million yen or more, you deposit at the bank account of a Japanese individual. In case if and when the alien entrepreneur does not hold his/her bank account in Japan, you follow an proper alternative method such as the bank transfer made to the bank account of the resident in Japan who is to be such cooperator as jointly being the representative director.

As for the description of the business, there is no particular limit, unless you violate any of the Japanese laws and/or regulations and/or the public order and morality. Such description of the business is to be stipulated in the articles of incorporation and the certified copy of register of the company.

(3) Securing of the store property and interior finishing (in case of operation is to be made at store)

In case of a store type business such as restaurant, securing the contract for the store also is required.

(4) Application for any and all operating permissions required for the business (in case of the business for which such permissions are required)

As for the business for which the permits or licenses are required, such as the restaurant business, the real estate business, secondhand goods dealer, alcoholic liquors sales business, temporary personnel business, charged employment placement service business, it is necessary that such certificates of permits or licenses shall be prepared in advance.

(5) The procedure for employing employees and the procedure for joining the Employment Insurance (if and in case when employing any employees prior to the application for the required operating permissions)

membersAs for the employment of any employees, in case when the employment has been already decided, it is necessary for you to submit all the related documents therefor. In case when the employment has not yet been decided, you are required to reflect these procedures in the personnel plan of the written business plan to be prepared.

(6) Preparation for visa application documents and application therefor to the competent Immigration Bureau

The preparation of the visa application documents to be presented to the competent Immigration Bureau which is described hereinafter and the application therefor shall be made. Although the application shall be made by the applicant himself/herself in person, you may be able to designate a certain administrative scrivener as your agent for such application.

(7) Acquisition of the required business management visa (or investment management visa)

If and when the result of the permit of the business management visa (or the investment management visa)by the competent Immigration Bureau was generated, such competent Immigration Bureau will notify the applicant himself / herself in person or his/her agent of such result.

The applicant himself / herself or his agent administrative scrivener shall bring the copies of the passport as well as the residency card of the applicant and such document as certifying the payment of charges and receive the permit verification seal, and thus all of the procedure required for the acquisition of the business management visa (or the investment management visa) gets complete.

3. Documents necessary for applying for any business management visa (or investment management visa)

Documents necessary and required for applying for any business management visa (or investment management visa) are massive. At least, the following documents shall be prepared:

(1) In case when the applicant intends to commence the operation of an international trade or any other business in Japan

[1]One set of application for issuance of certificate of eligibility ;
[2]One certificate photo (in the size of 4 ㎝ in length multiplied by 3 ㎝ in width); 
※a clear photo taken from the front of the applicant without any hat or cap and without any background scene which was taken within 3 months or less prior to the application
[3]Presentation and copy of the passport and a residency card (including any other registration certificate that is deemed as the residency card) ;
[4]A resume and any material that proves the personal histories of the applicant ;
[5]A certificate of the registered matters ;
[6]The financial statements for the most recent term (the profit and loss statement, the balance sheet and etc.)
[7]The business plan for the next 1 year in case of a new business ;
[8]A company guide, pamphlet and etc. ;
[9]A copy of the lease contract for the business place ;
[10]A list of names of full-time employees (except for the applicant) ;
[11]Copies of employment contracts with and written adoption notices to the company staff ;
[12]Copies of the resident cards or the alien registration certificates of the company staff ;
[13]Copies of minutes of the employment insurance premiums of the company staff for the most recent term ;
[14]Pictures of the inside and the outside of the business place;
[15]The shareholder registry ;
[16]Any material that can explicitly show the amount of investment ;
[17]The statement of reasons for having been invited, if any ;
[18]A return envelope (the address of which has been clearly written on the standard-size envelope with stamp (applicable to the simple registered mail) stuck thereto)

(2)In case the applicant intends to operate or manage the business either by himself or on behalf of a foreign national already engaging in commercial activities in Japan.

In addition to such materials as listed in the paragraph (1) above ;
[1]A copy of the agreement entered into with the applicant; and
[2]A resume of the applicant.

(3) In case when the applicant intends to engage in managing the international trade and other business in Japan

In addition to such materials as listed in the paragraphs (1) and (2) above ;
[1]Any material which proves that the applicant has 3 years or more of experience (including any educational experience) with respect to the business or the management;
[2]Any document that proves the contents of the duties as well as each period of each respective tenure of the applicant ;
[3]Any document that proves the period during which the applicant has majored the study subjects with respect to the business operation or management.

Further, it should be noted that, since such filing documents as above-written are defined as the minimum necessary documents, there might be possibility that the permission may not be acquired even after all of such documents as above-described have been submitted. By and depending upon the status of the applicant for the resident qualification, the required documents would vary, and it should be noted that any and all matters necessary for acquiring the permission of the any business management visa (or investment management visa) are to be necessarily substantiated on the part of the applicant.

Visa renewal in Japan

8434Today, we would like to introduce and explain the way how an alien to renew his/her business management visa (or investment management visa) in Japan.

It seems that the next important theme for those of foreign management who have acquired the business management visa (or the investment management visa) would be how to keep being renewed such immigration status for investment and/or business management.

The effective period of any business management visa (or any investment management visa) is 1 year in case when the company was incorporated for the first time.

This time, I would like to explain the procedure for updating the business management visa (or the investment management visa).

1.Structure of the renewal of the business management visa (or the investment management visa)

On the occasion of renewing the period of stay for the business management visa (or the investment management visa), usually the competent immigration bureau carefully examines the stability and/or the continuity of the business.

It will be no exaggeration to say that the matter which will become to be the most important point during the renewal process is the status of financial account settlement of the Japanese legal entity. Specifically speaking, the final judgment will be made by the competent immigration bureau based upon the profit and loss statement and the balance sheet.

Since the competent immigration bureau does not necessarily place importance on the status of situation of Accounts Settlement for one single fiscal year, just because the entity is in the red, it does not follow that no renewal can be permitted, and since there are many cases where a company falls into the red especially for its first fiscal year after its incorporation, the competent immigration bureau makes its judgment comprehensively including the lending and borrowing state of the company.

332For your information, please note that it is common or usual that any business is judged to have no continuity, in the event that no gross operating profit has been added up for 2 fiscal years in succession or in the event that an insolvency status has continued to exist for 2 fiscal years in succession with respect to the business.

Careful attention should be paid to the fact that the renewal of the business management visa (or the investment management visa) would become difficult unless there is a concrete business plan, such as the shift of the business paradigm which would enable the company to add up its gross profit and/or the elimination of net liabilities by means of the capital increase, does exist.

Well, the effective term of the business management visa (or the investment management visa) is normally 1 year, but there are some cases where the applicants may be able to receive the issuance of the business management visa (or the investment management visa) effective for 3 years, if and when the company keeps its accounts in the black for 2 fiscal terms in succession. The decision regarding whether or not such business management visa (or such investment management visa) as effective for 3 years will be made by comprehensively considering the operator’s career, the residing status of the applicant, the size and content of operation of the company and etc.

In the process of examination of the business management visa(or the investment management visa), the point of keeping the business in black is very important due to the fact that the stability and/or continuity of the business operation are carefully checked during the process. And yet here, please be sure that there is one point of attention, i.e. you must not set the executive remuneration of the representative at extremely low level for the purpose of reducing the expenses and increasing the profits just because keeping the business in black is important. It is necessary to formulate and implement the business plan which secures the monthly amount in the neighborhood of two hundred thousand (200,000) yens.

2. Classification applicable at the time of applying for any business management visa (or any investment management visa) (Organization to which the company belongs)

5432At the time of applying for any business management visa (or investment management visa), first of all, it is necessary for you yourself to examine under which category you fall out of those four categories that the Ministry of Justice has set forth. According to what is explained in the homepage of the Ministry of Justice, the contents of such four categories are as follows:

Category 1

(1) An enterprise that is listed on the Japanese Stock Exchange;
(2) A mutual company running any insurance business;
(3) A country or a local government of foreign countries; and
(4) A public interest corporation which has been validated by the country or any local government of Japan;

Since the above-listed legal entities are all very huge enterprises or a country or a local government etc., most of the foreign companies or alien entrepreneurs do not fall under any of such legal entities.

Category 2

Any organization or any individual whose amount of taxes withheld on the table of the total of withholding for the earned income shown in the table of the total in the statutory report for the tax certificate slips and etc. for the earned income of the staff for the previous fiscal year is fifteen million (15,000,000) yens or more

Category 3

Any organization or any individual whose table of the total in the statutory report for the tax certificate slips and etc. for the earned income of the staff for the previous fiscal year (excluding the amount described in the above category 2) has been already submitted.

Category 4

Any organization or any individual who does not fall under any of the above-written categories.
I think many foreign companies and alien entrepreneurs probably fall under this Category 4.

3.Documents required for renewing any business management visa (or any investment management visa)

435First of all, the filing documents commonly and usually required for any of the above-written Categories 1 through 4 are as follows:

(1) One set of application document requesting for the permit of the renewal of the period of stay

・The application form therefor is available at any regional immigration bureau. And in addition, you can get it out of the homepage of the Ministry of Justice.

(2) One sheet of the portrait photography of the applicant(with length of 4cm times width of 3cm)

・It should be a distinct picture taken within past 3 months prior to the application submittal, taken from the front of the portrait with bare head and without any background scene.
・Describe the full name of the applicant on the backside of said photo and then stick it in the photo column of the application document.

(3) Presentation of the passport and the residency card (including the alien registration certificate that is deemed to be the residency card)
(4) Submittal, to be made as necessary, of such writing as proving that the applicant falls under either one of the above four categories
[Category 1]

・One copy of the relevant page(s) of the Japan Company Handbook or one (copy) of any documents which proves that the applicant is listed on the Japanese stock exchange; and
・One (copy) of any documents which proves that the applicant has received the permission for incorporation.

[Category 2 and Category 3]

The table of the total in the statutory report for the tax certificate slips and etc. for the earned income of the staff for the previous fiscal year (one copy of the same having the reception stamp)
Subsequently, as for the above-written Category 1 and Category 2, no other materials are required as a general rule, however, as for the above-written Category 3 and Category 4 the following filing documents are required:

(5) One set of the copy of the documents for settlement of accounts for the most recent past fiscal year
(6) Each one set of certificate of residence tax declaration (or residence tax exemption) and payment certificate of the residence tax (which describes the gross income and tax payment situation for the past one year for the applicant)

3232・Such certificates are issued by and from the ward office, the city hall or the town/village office of the municipality where the applicant lives as of January 1 of the year.
・Either one of the certificates describing the gross income and tax payment situation for the past one year for the applicant (showing whether or not the applicant has paid the required taxes). You have to prove such gross income and tax payment situation but don’t have to submit two different types of such certificates, and only one certificate will be sufficient enough if it shows both of the gross income and tax payment situation.
・Please contact the nearest regional immigration bureau if and in case when no long time has passed since the time of your entry into Japan or if and in case when no certificates have been issued, due to the change of your residence and etc., by and from the competent ward office, city hall or town/village office in charge of your place of living.

Further, as for the Category 4, the below-listed filing documents are required as well:

(7) One set of the certificate for the foreign corporation’s exemption from the obligation to withholding income tax or any other material proving that no withholding is required.

・In addition to the above-written, since there may be such case as the competent Immigration Bureau may request for materials than the above-written during its examination process at such Immigration Bureau after you submitted your application, you have to be careful to know that the above-written requirement is the minimum requirement for the filing documents or the documents to be submitted to the utmost.
・Now, explaining more with respect to the documents to be prepared for the purpose of renewing the business management visa (or investment management visa), any and all certificates issued in Japan are decided to be those for submittal within 3 months after the issuance thereof. Further, if and in case when any of the filing documents has been prepared in foreign language, it is required that you attach its translation (made in Japanese) without fail.
・Since any material that has been once submitted will not be returned back to the applicant, it is necessary for you to pay attention to the requirement that you are required to notify the competent authority of your desire that you wish such originals of the materials as are difficult to acquire or obtain once again to be returned back to you.
・Since you are allowed to and can apply the renewal of the business management visa (or investment management visa) for approval roughly from 3 months prior to the expiration of the existing period of your stay (in case of the period of stay is 3 months or less, roughly from the time when one half of the period of your stay has elapsed), it is desirable for you to make such application by giving yourself plenty of time.

4.Form of Application Document; Entry Example; Sample of Writing Format

0004The followings are the form and entry example of the application document requesting for the permit of the renewal of the period of stay:
Please note that there are some times when the latest revisions thereof are issued in and from the homepage of the Ministry of Justice.
PDF Form , EXCEL Form 

5. Situation of Accounts Settlement of the Japanese Legal Entity

The fact that the situation of accounts settlement of the Japanese Legal Entity makes a great impact on the renewal of the business management visa (or investment management visa) is as described above. It is required for you to perform an elaborate business management so as to ensure that the company can achieve the accounts in the black for every fiscal term. As for more detailed guidelines with respect to the continuity of the business, “Regarding Clarification Of Standard Of Immigration Status Of Alien Entrepreneur ” (issued in August, 2005 by the Immigration Bureau, Ministry of Justice) can be and should be referred to.

A. In case if and when any gross operating profit exists in the most recent fiscal term or in the fiscal term immediately prior to the most recent fiscal term

In case if and when any current net income exists in the most recent fiscal term and any surplus exists at the end of said fiscal term, the business is to be judged to have no problems in terms of its continuity. And, even if the business has become net loss for the current term in the most recent fiscal term, and if it turned out that the surplus just decreased only and the business did not result in a loss so far, it is not judged that such fact will create a serious bad effect on continuing the business and therefore, the continuity of said business is deemed to exist under such situation as well. And consequently, if and in case when any surplus exists at the end of the most recent fiscal term or if and in case when no surplus nor deficit exists, the continuity of the business is deemed to exist.

B. In case if and when any deficit exists at the end of the most recent fiscal term

[1]In case if and when the company has not become insolvent at the end of the most recent fiscal term:

545454Considering the possibility that the continuity of the business can be expected in the future based upon the status of the company’s business plan, fundraising and etc., and subject to the company’s submittal of such materials as showing the business plan as well as the expected profits for the next 1 year, but except for the case where there is any doubt on how the business is being operated, the competent Immigration Bureau, Ministry of Justice deems as a general rule that the continuity of the company’s business does exist; provided, however, that, depending upon the content of said materials, there are some cases where the submittal by the company of such documents (limited to those documents which clearly describe the reasons why such evaluation was made) as showing the evaluation made by such third party having the public qualification as can be acknowledged to have the ability of performing an enterprise evaluation, such as the small business consultant, the certified public accountant and etc. is requested.

[2]In case if and when the company was insolvent at the end of the most recent fiscal term but was not insolvent at the end of the fiscal term immediately prior to the most recent fiscal term :

Generally speaking, it is hard to recognize the continuity of the business if the business has become insolvent, because, in such situation, the creditability of the business has dropped down to the extent that the continuation of the business is feared, but limiting only to such case where the insolvency has not lasted for 1 year or more, and on condition that some concrete improvement (which means getting rid of insolvency condition) to be made within 1 year is reasonably expected, then the continuity of the business will be recognized.

Specifically speaking, if and when, although the company was insolvent in the most recent fiscal term, the company had not been insolvent at the end of the fiscal term immediately prior to the most recent fiscal term, the competent Immigration Bureau, Ministry of Justice is to request the applicant to submit such document (limited to those document which clearly describes the reasons why such evaluation was made) as showing the evaluation made by such third party having the public qualification as can be acknowledged to have the ability of performing an enterprise evaluation, such as the small business consultant, the certified public accountant and etc., and then, said competent Immigration Bureau, Ministry of Justice is to judge the continuity of said business in reference to said document.

434[3]In case if and when the company was insolvent both at the end of the most recent fiscal term and at the end of the fiscal term immediately prior to the most recent fiscal term as well :

In case if and when the company could not get rid of the insolvency status even after 1 year or more passed since the company got insolvent, it will not be deemed that the continuity with respect to such company does exist due to the fact that the severe financial status still continues to exist with respect to the continuity of the business and further that any sufficient improvement has not yet been materialized within 1 year.

[4]In case if and when no gross operating profit exists with respect to the company both at the end of the most recent fiscal term and at the end of the fiscal term immediately prior to the most recent fiscal term:

In case if and when the sales amount falls below the cost of sales in the main business of any enterprise, such enterprise could not be deemed to be performing a normal business activities, and therefore, even if the profit was secured by the non-operating profit and loss and/or by the extraordinary income or loss, such secured profit shall not be deemed to have been generated by and from the primary business of the enterprise.

It can be easily assumed that there may be some cases where no gross operating profit was achieved in a certain single fiscal term due to any extraordinary reasons, but, if a company could not achieve its gross operating profit for 2 fiscal terms in succession, such case means, if happened, we cannot deem that such company or enterprise has its ability to perform its main business continuously. Therefore, in such case, the continuity of the business shall not be deemed to exist.

Please note that there are two case examples with respect to approval or disapproval of the renewal of the business management visa (or investment management visa) for each respective alien entrepreneur of the two (2) Japanese legal entities both of which have added up their respective current net loss in their settlement for their respective most recent fiscal term as follows :

[Case Example 1]

00003The case where the company has not got insolvent notwithstanding the fact that the current net loss has occurred with respect to said company:
According to the financial statement of the Japanese legal entity for the most recent fiscal term, the company has not got insolvent notwithstanding the fact that the current net loss has occurred with respect to said company. And in view of the then-existing situation said financial statement was covering their first fiscal term of said company, in this case, the continuity of said business was deemed to exist.
・Reference Indexes:(Sales Amount Gross Profit:60 % approx., Sales Amount Operating Profit Ratio: less than 65 % approx., Equity Ratio:30% approx.)

[Case Example 2]

The case where the office of the restaurant is a home-cum-office:
According to the financial statement of the Japanese legal entity for the most recent fiscal term for the company, the gross loss on sales (sales amount less cost of sales)has occurred and the current term net profit or loss is in the red in the company, and the company has the deficit the amount of which is approx. twice as much as the capital, and consequently the continuity of said business was not deemed to exist.
・Reference Indexes:(sales amount gross profit:less than 30% approx., sales amount operating profit ratio:exceeding minus 1,000 %,equity ratio:less than 100% approx.)

6. Other important points to note for renewing the business management visa(or the investment management visa)

In here, we have summarized other important points to note for renewing the business management visa (or the investment management visa) as follows:

[1]The period of stay in Japan :

If and when the alien entrepreneur has been out of Japan for a long time, there are some cases where the competent Immigration Bureau may have such doubts as “Is there any reason why a business management visa (or an investment management visa) should be issued to such alien entrepreneur ? Although I think that, since you are one of the foreign companies, the overseas transactions beginning with international trades in your company have increased and therefore it is not uncommon case for the alien entrepreneur himself/herself to make overseas business trip, you should note that some reasonable explanation will be required if and when the alien entrepreneur leaves out of Japan for a long time.

0001[2]The content of the businesses to be done as the entrepreneur of the company :

Any and all aliens who have acquired the business management visa (or investment management visa) are originally required to devote himself/herself to the “management”. However, there quite a few cases in the small and medium-sized enterprises where the entrepreneur himself/herself serves as a shop-worker. For example, in a restaurant operation etc., if and in such case as the entrepreneur himself/herself is performing his/her cooking work at the spot of the restaurant, there are some cases where doubts may arise in relation to the immigration status for “Skilled Labor”.

It is very important for any alien entrepreneur to keep certainly renewing his/her business management visa(investment management visa) in the course of running his/her business taking root in Japan and setting up his/her life considering getting permanent residency in Japan in the future. 

Contact us

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