Guide to Japan Company Registration

General Procedures for Company Formation (KK)

01 Appointment of Representative Director

■To get ready for a Japan entry project, the parent company needs first to find a Local Director to lead business development in Japan. Once you hire a local director, you must appoint a Representative Director of the Japanese subsidiary. Due to a recent change in Corporate Law, non-residents can hold the Representative Director position. (Formerly, it was required to have at least one director who resides in Japan)

1) Local Director (either Japanese or non-Japanese) who resides in Japan

2) Representative Director who may reside outside of Japan (e.g., Director of International Business Department or CEO of the parent company)

3) Nominee director


■Unlike in many other countries, there is no official Nominee Director system in Japan. In other words, liabilities as a representative director cannot be automatically transferred to shareholders. Few people would accept the position of the nominee director.

■It is possible to establish a corporation without a Local Director. However, most banks in Japan will reject applications to open a bank account for a company that does not have a Local Director.

02 Selection of Office Type

■In order to register a company, you need to have an office address.
1) Virtual Office (office address only)
2) Serviced Office (e.g. Servcorp/Regus)
3) Independent Physical Office 


For international companies who do not have a business presence in Japan, it is hard to enter into a contract with building owners. In such case, it may be good to use a serviced office as your initial office. Also, serviced offices are often flexible to provide English contracts, while traditional Japanese building owners are less likely to accommodate contracts in English.

03 Notification to the Bank of Japan (Prior or after the company formation)

■In case that a foreign corporation establishes a 100% owned subsidiary in Japan, the Japanese subsidiary is subject to the “Inward Direct Investment” regulation in the Foreign Exchange Law. This law requires the company to report the acquisition of stock in the Japanese company to the Bank of Japan either prior to or after the company formation depending on the sector.
If the company fails to report to the Bank of Japan, the Japanese government has authority to suspend the business. As such, companies need to carefully consider if the prior notification to the Bank of Japan is required when the company determines the business objective written in the articles of incorporation. 


■Notification of stock acquisition to the Bank of Japan
Financial, energy, defense, and national security sectors are regulated, so if the parent company enters into these sectors in Japan, a prior notification to the Bank of Japan is required.

04 Determination of Company Promoter

■A Promoter is a person who signs off on the Articles of Incorporations by determining the company profile and conducting the company formation procedures. Generally, a Japanese corporation or a Japanese resident becomes the promotor, however, overseas corporations or non-Japan residents can become a promoter. 


■Corporate laws require the promoter to provide the “Company Registration Certificate” and the “Seal Impression Certification,” however foreign corporations will not be able to provide it due to the different certificate system in each countries.
Alternative to “Company registered certificate” and “Seal impression certification,” the following document along with Japanese translation of these documents are required:
– Affidavits on the corporate profile attested by a notary public
– Signature certificate of CEO of parent company attested by a notary public

05 Preparation of KK’s Articles of Incorporation

■KK’s articles of incorporation should contain information including the following: trade name, location of head office, business objectives, business year, amount of capital, issue price of shares, existence of provisions restricting transfer of shares, existence of board of directors, names of directors and representative directors, terms of directors, names of equity participants, and values of their investments. 


■The Articles of Incorporation document is generally prepared only in Japanese, however, legal counsel at the parent company often requests an English version. To respond to this need, VentureINQ prepares the Articles of Incorporation document including both Japanese and English clauses.

06 Arrangement of Affidavit and Signature Certificates

■If the parent company establishes a 100%-owned subsidiary and appoints the CEO of the parent company as the representative director of the KK, the following document is required:
(Case: Representative director of KK: CEO of Parent Company)
1) Affidavits of the corporate profile attested to by a notary public
2) Signature certificate of the parent company’s CEO attested to by a notary public
3) Driver’s license of CEO
4) Corporate registration certificate 


■Affidavits and signature certificates need to be tailored to meet the requirements under Japanese corporate law. In other words, sufficient information for the purpose of company registration should be included in the affidavits and signature certificates. VenturINQ supports drafting the Affidavits and signature certificate.

■Notary systems vary between countries. In the US, a notary public has authority to attest to the affidavit and signature certificate. In Hong Kong, some law firms have authority to notarize the documents. Since it can take a significant amount of time to get notarized documents and some countries do not respond to nomination in English, it is important to check the home country’s notarization system.

07 Arrangement for Signatures on the Company Registration Document

■Once the necessary documents for company formation are ready, VentureINQ will arrange for the final signature on the documents. The following documents require the signature of the parent company CEO and representative director of the KK:
(Signature of Parent Company CEO)
-Power of attorney (on notarization of Articles of Incorporation)
-Written decision of promoter
-Power of attorney (on receipt of capital amount)
(Signature of the KK’s Representative Director)
-Letter of acceptance of appointment (Director)
-Letter of acceptance of appointment (Representative Director)
-Registration of a corporate seal impression 


In Japan, we have the special practice of signing by overlapping the cover page and binding tape instead of signing initials on all pages. Please make sure to sign as instructed.

08 Arrangement for Company Seal

■In Japan, all companies need to a have corporate seal alternative to the official signature. Companies are required to put their corporate seal on application documents for company registration.
The cost for a set of the three seals starts from $200. The parent company needs to get local director or VentureINQ to order seals before applying for company registration.
■It is important for legal counsel at the parent company to understand the usage of each type of corporate seal.
For further details, please refer to the “Corporate seal” section. 

09 Notarization of the Articles of incorporation

■Once the CEO of the parent company signs off the Article of Incorporation, our company formation specialist will submit the Articles of Incorporation to a notary public.
■Most notaries public in Japan are not used to working directly with international companies, so advance consultation with the notary public is critical for the smooth completion of notarization procedure. 

10 Fund Transfer of Initial Capital

■After the completion of the notarization, the parent company will wire the initial capital to their designated bank account in Japan. There is a special regulation on the bank account to which the parent company wires money. The bank account needs to be a Japanese bank account that the promotor owns. Thanks to a recent change in Japanese law, it is allowed to designate the a 3rd party’s bank account. In other words, you can wire the capital amount to the local director or 3rd party’s bank account for initial capitalization. In this case, the parent company needs to sign a “Power of Attorney (on receipt of capital amount)” as evidence of capital amount. A copy of the passbook (bank account ledger) needs to be attached with the company registration document.
■To avoid complications, it is important that the wire transfer amount should exceed the capital amount written on the documents. We have often seen the delays in paperwork because the capital received was lower than the amount specified on the documents due to the deduction of bank fees, so please ensure that even with deductions, the capital received is higher than what is specified on the documents. 

11 Application of Company Registration to Legal Affairs Bureau

■After completion of initial capital transfer, our legal specialist will submit the document to the Tokyo Legal Affairs Bureau. The date of the application is set as the official company registration date. At the same time, our legal specialist will submit the registration of company seal impression.
■It takes 5 to 10 business days to complete the registration after submitting the application. 

12 Obtaining of Registration Certificates and Seal Impression Certificates

■After completion of the registration, our legal specialist will obtain a hard copy of registration certificates and seal impression certificates.
■The hard copy of registration certificates will be used for various procedures such as opening a bank account and the reporting to the tax and labor offices. As such, we generally recommend to obtain 3-5 copies of these certificates. 

13 Completion of Company Registration

■Once you confirm the company registration, there are a number of required procedures in relation to taxes, payroll and company formation as follows:
1) Opening a bank account and setting up the online banking system
2) Filing to tax office
3) Reporting to the labor office and social insurance office
4) Reporting to the Bank of Japan