I want to start a company in Japan. What do I need to prepare?

As global uncertainty increases, more and more Taiwanese individuals are seeking to invest in Japan through the Business Manager Visa as a means to eventually obtain Japanese residency. One of the key requirements for applying for this visa is the establishment of a company in Japan. This article will introduce the procedures for setting up a company in Japan.

The Three Major Stages of Company Establishment

Stage 1: Preliminary Preparation

At the initial stage of establishing a company, investors need to decide on fundamental details such as the company name, business scope, location, and capital.

• Business Activities:What will be the main business of the company? For example, it may engage in real estate transactions or leasing, hotel management, etc. The company can be established according to actual business needs.

• Company Address:Where will the company be registered? Does the company want a prominent address as part of its branding? How many employees are expected, and how large an office is needed? For the sake of convenience, should the office be near the residence? Is the intended address suitable for commercial use?These questions need to be carefully considered based on the investor’s unique needs before determining the best location.

• Capital:Japan does not have a legal minimum capital requirement, meaning a company can technically be established with just 1 yen. However, in practice, setting an obviously low capital amount may lead to the bank rejecting account opening requests or loan applications. Therefore, it is advisable to determine the capital based on actual business needs.

• If establishing a "Kabushiki Kaisha" (similar to a Taiwanese limited company), the investor must also decide the number of shares issued and the value per share.

Stage 2: During the Company Setup

Once all documents are prepared, the process moves into the second stage. At this point, the articles of incorporation should be completed, and the investor needs to deposit the capital into a Japanese bank account.A common issue arises here: what if the investor does not have a Japanese bank account?

If the investor has friends or relatives in Japan with a bank account, it is possible to transfer the capital to that person’s account temporarily. Once the company’s own bank account is opened, the funds can be transferred there. If the investor does not have any acquaintances in Japan, they may ask the Japanese expert assisting with the company setup if such support is available.

Additionally, the company seal must be created during this stage—something that Taiwanese investors are likely familiar with. In Japan, there are customary practices regarding company seals. Typically, three types of seals are made:

• A seal for registration with the Legal Affairs Bureau.

• A seal for opening a bank account.

• A seal for issuing documents to third parties.

The registration and bank seals are usually round, while the seal used for external documents is typically square.

Stage 3: Completion of Company Registration

Once the company is registered with the Legal Affairs Bureau, it is officially established. Unless the company’s business requires a separate operational license, it may begin operations immediately after registration.

However, completing the registration does not mean the process is over. The next steps include opening a corporate bank account, registering with the tax office, and, if employees are hired, reporting to the Labor Bureau and enrolling in Japanese labor and health insurance systems. Don’t forget, once the company starts operations, accounting begins as well. If the investor prefers not to manage the books themselves, they can outsource this task to a professional Japanese CPA.

Conclusion

Compared to Taiwan, the procedures for setting up a company in Japan are more complex and time-consuming. Therefore, it is advisable for investors to plan ahead if they are considering this option.