Incorporating Your Business
Q. What types of business entities are there in Japan?
A. Foreign companies generally establish a business presence in Japan in one of three modes; representative office, branch office, and subsidiary company. Please see the details of each mode.
Q. What is the difference between these types of business entities?
A. Foreign companies generally engage in business operations by establishing a branch office or a subsidiary company. Representative offices are not permitted to engage in sales activities. Please see the legal differences among them.
Q. How long does it take to set up an office?
A. In the case of a branch office, it takes about one month after determination of branch office information to be registered. For a subsidiary company, it takes about two months after determination of particulars of a company to be established.
Q. How much does it cost to set up a branch or a subsidiary?
A. The items that should be considered as initial costs are company establishment, tax notices, hiring local personnel, setting up a permanent office, setting up permanent housing for foreign nationals, obtaining visas, etc. As for the company establishment and tax notices, it costs about 610,000yen to establish a subsidiary company, whereas it costs about 420,000yen to establish a branch. These cost figures are approximations and include both actual expenses and fees for professional proxies.
Q. What are the minimum requirements to set up an office?
A. For a branch office, at least one representative in Japan must have an address in and be resident in Japan.
For commercial registration, documents evidencing the existence of the applicant's head office (such as the registration in its home country or certificates of competent authorities), documents certifying appointment of the representative in Japan (such as minutes supporting decision by appropriate organization within the applicant), article of incorporation, etc. should be examined. Please consult with commercial registration experts for more detail.
Q. What are the procedures for establishing a presence in Japan?
A. Both a branch office and a subsidiary company are established through commercial registration with the Legal Affairs Bureau. Please see the general flow of procedures for establishing a presence in Japan.
Q. What are the merits of establishing a presence in Japan?
A. Having an office in Japan will make it possible to provide more prompt and smoother sales assistance, technical support and after sales care, etc. to customers, clients and business partners. In fact, foreign companies need to establish a branch office or subsidiary company to generally engage in business operations.
Q. Can a person who is not a resident in Japan become a representative?
A. Non-resident person can be a representative of a subsidiary company. For a branch office, at least one representative in Japan must have an address in and be resident in Japan.
Q. Can anyone engage in the commercial registration procedure with the Legal Affairs Bureau?
A. Anyone can engage in the commercial registration procedure, however, outsourcing the procedure to experienced commercial registration experts will, generally speaking, make it easier and more certain.
Q. Can I reorganize a branch office into a subsidiary?
A. Because a branch office cannot be directly reorganized into a subsidiary, the branch office closure procedures and the subsidiary company establishment procedures must be carried out simultaneously. In such instances, however, the branch office's assets may be transferred to the subsidiary through contribution in kind. Please see the closure of a branch office, dissolution and liquidation of a subsidiary company for more information.