FAQ

1. Why do I need to hire someone to set up a company for me in Japan?
Would I be able to do it by myself?

Hiring an experienced third party provider to set-up your business in Japan significantly simplifies the entire process and facilitates a smooth entry into the Japanese market. It will also help you to avoid unnecessary costs by using standardized processes and documents which J-Seed handles on a regular basis. If you should decide to register a branch or incorporate a subsidiary on your own, your company will require someone in Japan who can personally deal with the Legal Affairs Office and a Japanese bank. That person also needs to be able to speak, read and write Japanese or have a reliable translator since all documentation is handled exclusively in Japanese. Further, most staff that work at Japanese banks as well as at the Legal Affairs Office are unable to speak English.

Moreover, incorporating a company includes a lot of back and forth from the bank to the Legal Affairs Office which can lead to an overall inefficient, yet common process. Hiring a law firm to deal with the documentation is one option but this still requires someone in Japan to deal with relevant matters like opening a bank account and applying for the various corporate seals.

In truth, it is necessary to have someone who is a legal resident of Japan serve as a representative director of the Japanese company if you want to facilitate your business operations in Japan.

2. Which kind of legal entities suitable for foreign companies exist in Japan and what are the differences?

Basically, there are two options for foreign companies to operate a business in Japan. The first option is to set-up a branch office; the second is to set-up a subsidiary with liability limited to the subsidiary’s capital. For a detailed overview on the differences between a subsidiary and branch office, please take a look a the “Branch or Subsidiary” section on our website.

3. Are there any important laws and regulations that I should be aware of before setting up a company in Japan?

You should be aware that if you decide to set up a branch office in Japan rather than a subsidiary, an overseas parent company would not be shielded from liability in contract and labor disputes. Therefore, to the majority of our customers we recommend setting up a subsidiary to create a legal shield and lessen any potential liability that may arise in future disputes. Moreover, a subsidiary provides proof to local customers and employees of your full commitment to the Japanese market.

4. What are the costs involved in setting up a company in Japan?

Besides the time and effort involved, the establishing of a company in Japan involves various charges by different entities. The list below provides an approximate overview of the fees charged when you decide to file a company individually.

Costs occurring for the incorporation of a Subsidiary

  • Registration tax                                                            150,000 yen
  • Stamp tax                                                                     40,000 yen
  • Certified copy of articles of incorporation            　      3,000 yen
  • Corporate seals (Hanko)                                             3,000-20,000 yen
  • Bank handling fee                                                         ???
  • Law firm fee for drafting documents                           200,000-500,000 yen
  • Notary fee to certify articles of incorporation　　　　 50,000 yen

The total amount of fees and taxes ranges between 400,000-750,000 yen, not including expenses for time and travel. In case you decide to file your company in Japan with J-Seed the quoted prices for setting up a branch (500,000 yen plus 5% consumption tax) or subsidiary (1,000,000 yen plus 5% consumption tax) are fixed quotes and include all the above fees.

5. How long does it take to set up acompany in Japan?

As a rule of thumb, it requires roughly a month to set-up a company in Japan. Once the form we have provided　on the website is filled out properly and all required documents are submitted, it takes approximately two weeks to register a company. As soon as the company is registered it is possible to begin operations in Japan. Approximately two weeks after the registration of the company, an official confirmation will be provided by the Legal Affairs Office. Thus, the whole process concluding when the proof of the registration is obtained, takes roughly one month. In case you decide to set-up a branch in Japan you must provide a translation of various corporate documents which must be certified by the embassy or consulate of the country of incorporation. This process also requires approximately one month.

6. Do I have to hire staff from the first day?

It is not necessary to hire staff from the first day. In the case of setting up a branch office or subsidiary, you will need to register someone who is resident in Japan who is willing to serve as a representative or representative director, respectively. The representative or representative director can be of any nationality but must be a current legal resident of Japan.

7. Do I need a physical office in Japan to set up a branch or subsidiary?

No, an address you are legally entitled to use for registration purposes is sufficient. For example, you could rent a virtual office as long as the company providing the virtual office address allows it. We recommend double-checking this aspect with the virtual office provider and if necessary to upgrade your virtual office contract to an appropriate package or change the service provider accordingly.

8. Do I have to wait until the company is incorporated to start my business in Japan?

To prevent personal or parent company liability issues you should register a branch or set-up a subsidiary company before starting to operate your business in Japan. Once the company is incorporated (approximately two weeks after submitting the form(link) and all other necessary documents) business can be started with limited liability. Nevertheless, we recommend waiting until you receive the final confirmation from the Legal Affairs Office to minimize your risk.

9. What company information do I have to disclose when setting-up a company in Japan?

The degree of company information that needs to be disclosed depends on whether you decide to set-up a branch or a subsidiary. In the case of setting-up a branch, certain financial information of the parent company such as the number of issued and outstanding shares, the number of authorized shares, and paid-in capital, etc. will be required. For a subsidiary, only information regarding the subsidiary’s capitalization must be disclosed.

10. How long does it take to obtain work visas for foreign staff?

Work visas usually take about 1 month to obtain. However, in the case of a new entity it may take 2-3 months. Qualification, country of citizenship and capitalization of the parent company as well as the company in Japan are factors which heavily influence the duration and probability of obtaining a working visa. After the subsidiary is incorporated, you can apply for a certificate of eligibility (CoE). Once the CoE is obtained it is relatively simple to receive the actual work visa form your local Japanese Embassy or consulate.

11. What cost is involved in obtaining work visas for foreign staff?

The cost of obtaining a work visa ranges from 100,000 to 300,000 yen per person (and 20,000-30,000 yen for each dependent family member) and is handled by a “Gyoseishoshi”, a type of administrative lawyer specializing in visas and other administrative matters.