Four Key Considerations for Foreigners Starting a Business in Japan

For foreigners planning to establish a company in Japan and obtain a Business Manager Visa, careful preparation is crucial. This article outlines the four most important factors you must consider when starting your business.

1. Selecting the Office Location

The registered head office address is not only important for legal and administrative procedures but also plays a significant role in the visa screening process. For those applying for a Business Manager Visa, choosing an appropriate business location is essential.

• Permanent residents, spouses of Japanese nationals, or long-term residents: Can register their home address as the company office.
• Business Manager Visa applicants: Must secure an independent business-use office space.

Important notes:

• Virtual offices may hinder bank account opening and visa approval.
• Residential properties such as homes, a friend’s residence, or apartments designated for living only are not allowed.
• Shared offices may be rejected if only common spaces are available.

Recommended office types:

• Rented apartments or rooms with commercial-use permission.
• Standard office spaces in commercial buildings.
• Rental offices with secured and private rooms.

Note that your office location will also determine the jurisdiction for the tax office and Legal Affairs Bureau. Choosing wisely can help streamline administrative processes.

2. Capital Requirements

Capital is a crucial factor that impacts your company's credibility. Specific requirements apply when aiming to obtain a Business Manager Visa.

Your capital amount should reflect not only initial setup costs but also your future financial plans and funding strategy. Consulting with a professional is recommended.

3. Defining the Business Objectives

The business purpose listed in the Articles of Incorporation and registered on your company profile must be accurate. Vague or overly broad statements may lead to complications when applying for licenses or visas.

• Clearly state the actual business activities you will conduct.
• Use specific legal wording when licenses or permits are required.

Example: If operating a restaurant, include terms like "operation of food and beverage establishments" and "preparation and sale of meals."

Having too few purposes may appear unambitious to banks, while listing too many unrelated purposes may be seen as unrealistic. A balanced and strategic approach is essential.

4. Determining Executive Structure

The structure of your executive team greatly influences company management. Deciding who will serve as the representative director and whether to appoint additional directors is a critical step.

• The executive structure will be reviewed during bank account opening.
• Some industries require licensed individuals as directors for legal approval.
• Including Japanese nationals or permanent residents can increase credibility.

Even if the sole director is a foreigner, as long as there is a solid business plan and residential stability, it is generally acceptable. However, partnering with someone familiar with Japanese practices can improve operational efficiency.

Conclusion

Establishing a company and obtaining a Business Manager Visa in Japan involves several key considerations. Among them, selecting a suitable office, securing the necessary capital, clearly defining your business objectives, and building an appropriate executive structure are critical to success.

By addressing these areas carefully, you can lay a solid foundation for a smooth business launch and visa approval process.