201912.04
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Q_iconWhen incorporating a stock company in Japan, when should we set-up the capital?

A_dark_iconCapital must be fully paid after the preparation of the articles of incorporate or from the date in which the incorporator determines the amount to be contributed during incorporation.

★ Explanation ★

1. The “Business Manager” Visa

When a person from overseas plans to manage or administrate a company or business in Japan, they are required to obtain a status of residence called the “Business Manager”, also referred to as the “Business Manager” visa. Individuals under any of the following statuses of residence may also engage in management or administrative activities for a company:

  • Permanent Resident
  • Spouse or Child of Japanese National
  • Spouse or Child of Permanent Resident
  • Long Term Resident

2. From the “Investor/Business Manager” visa to the “Business Manager” visa

What was previously known as “Investor/Business Manager” visa was changed to the “Business Manager” visa following its name change effective April 1, 2015 onwards through the “Immigration Control and Refugee Recognition Act” (hereinafter referred to as the “Immigration Act”). The change in name comes with the relaxation of requirements ― following amendments made to the Immigration Act, foreign capital requirements to obtain the then-“Investor/Business Manager” visa was removed. As a result, the “investor” terminology in the name of the visa (both in Japanese and English) was removed; this visa is now issued to foreign nationals who will engage in activities to operate or manage a business or company in Japan.

3. Activities allowed with the “Business Manager” visa

business-management-visaAuthorized activities for those with the “Business Manager” visa include the ability to engage in the decision-making process regarding important matters concerning the business operations of a Japanese corporation, execution of business, etc. and the management of the business.

Specific examples include the tasks performed by representative directors (CEOs), directors, company auditors, department heads, factory managers, and branch managers, as well as those who are broadly defined as engaging in the “activities of a manager” or “activities of an supervisor”.

< Activities allowed with the “Business Manager” visa >

(1) Management or Supervisory-related activities

Holders of the “business manager” visa can set-up a new business in Japan. They may also invest in joint ventures with already existing enterprises in Japan, or the be a business transfer recipient. This visa/residence status makes the performance of tasks of a business manager in Japan much easier.

(2) A variety of businesses

As long as one holds the “business manager” visa, they may put up business without any limitations in terms of business content, as long as the business is recognized as a legal one. With the “business manager” visa, one can dabble in a wide range of businesses without any special restrictions placed on the company the visa holder has established.

4. Basic criteria for the “business manager” visa

The basic criteria to be able to obtain the said visa is stipulated in the ministerial ordinance issued by the Ministry of Justice.

Ministerial Order to Provide for Criteria Pursuant to Article 7, paragraph (1), item (ii) of the Immigration Control and Refugee Recognition Act (Activities listed in the right-hand column under “Business Manager” of Appended Table I(2) of the Act)

The applicant comes under all of the following requirements.

(i) A business office for the purpose of engaging in the business pertaining to the application exists in Japan; provided, however, that if the business has not yet commenced, facilities to be used as a business office for the purpose of engaging in the business have been secured in Japan.

(ii) The scale of the business pertaining to the application comes under one of the following requirements.

(a) The business concerned employs at least two full-time employees in Japan (except for foreign nationals residing in Japan with a status of residence listed in the left-hand column of Appended Table I of the Act) other than those who operate or manage the business.

(b) The amount of the stated capital or the total amount of the contribution is at least 5 million yen.

(c) The scale of the business is recognized to be equivalent to the scale set forth in (a) or (b).

(iii) If the applicant intends to manage the business, the applicant has at least 3 years experience of operating or managing a business (including any period where the applicant majored in the operation or management of a business at a graduate school), and, receives no less remuneration than would a Japanese national for comparable work.

Source: Japanese Law Translation Database System
http://www.japaneselawtranslation.go.jp/law/detail/?id=3041&vm=04&re=02&new=1

To be able to engage in activities as a manager, one needs to be able to secure a business office in Japan, and the scale of the business requires capital or an investment of 5 million yen or more. Furthermore, at least three years of managerial (or supervisory) experience is necessary, and the amount of remuneration received by the applicant should not be less than the salary amount a Japanese national engaging in a similar line of work should receive.