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Q_iconCan foreigners set-up a stock company, limited liability company (or similar company types) in Japan?

A_dark_iconYes, they can. There is no nationality requirement when it comes to setting-up a stock company or limited liability company.

★ Explanation ★

Even foreigners can set-up a stock company or limited liability company in Japan. There are such cases where one has been barred from setting-up their company in Japan simply due to nationality. This is not strictly limited to individuals either ― even companies from countries such as the United States or China can expand their businesses into Japan. Up until March 2015, the representative director (for a stock company) or at least one representative officer (for a limited liability company) was required to be a resident in Japan. However, following the release of Notice No. 29, released by the Ministry of Justice in March 16, 2015, this requirement was no longer applicable, and non-residents were now allowed to put-up their business in Japan.

Notice from the Ministry of Justice, Min-sho No. 29 dated March 16, 2015

The application for the registration of incorporation of a domestic stock company of which all of representative directors do not have any residential address in Japan, and for the registration of reappointment or appointment of representative directors of such domestic stock company may be accepted from today on, even though the answers of the Director of the Fourth Division of the Civil Affairs Bureau dated as of September 26, 1984 (Min-yon, No. 4974) and March 11, 1985 (Min-yon, No. 4974) mention that such application should not be accepted.

Response from the Director of the Fourth Division of the Civil Affairs Bureau dated September 26, 1984 (Min-yon, No. 4974)

At least one representative director with a residential address in Japan must be appointed for domestic stock companies; incorporation applications of domestic stock companies without at least one appointed resident representative director should not be accepted.

Response from the Director of the Fourth Division of the Civil Affairs Bureau dated March 11, 1985 (Min-yon, No. 4974)

Registration of reappointment or appointment of representative directors’ applications should not be accept if the concerned domestic stock company does not have at least one representative director with a residential address in Japan.

Source: The Ministry of Justice
http://www.moj.go.jp/content/001231086.pdf

foreign-company-setup-businessThere are certain items one should be careful of if a foreigner would incorporate a company in Japan. Firstly, since transferring capital through a financial institution within Japan would be necessary, at least one incorporator (or representative director) should have an account with a financial institution in Japan; otherwise, they would not be able to set-up their company. (➡For further information, refer to Q42, Q51.)

Similarly, when creating a bank account under the name of the company, there are some cases where financial institutions would not approve applications unless one representative director has a residential address in Japan. (➡For further information, refer to Q108.)

Furthermore, should a foreigner actually work in Japan and apply for a business manager visa, a capital amount of more than 5 million Japanese yen would be necessary. (➡For further information, refer to Q83.)

You may also recall that during the process of incorporating one’s business, a certificate of registered seal is required, which is issued by the municipal government office for residents in Japan. Non-residents will need to obtain a signature certificate from their authorities from their home country.

To avoid any complications when setting-up your company, we suggest enlisting the services of professionals whose focus not only lies with company incorporation, but also with visa, permits, licenses, tax, human resources and various other services to make the process much smoother.