1．Basic Structure of Incorporation

To incorporate a company in Japan, you must first decide on the company’s basic framework. The following elements have a significant bearing on the subsequent registration and operation of the company.

Amount of capital (Shihonkin-gaku): Under the Companies Act, a company can be incorporated with capital of as little as one yen. However, where a foreign national who will manage the company intends to obtain the “Business Manager” residence status, the following are, in practical terms, substantive requirements: a capital contribution of at least JPY 30 million; practical experience (at least three years of experience in business management, or a degree at master’s level or above relating to business management); an employment obligation (employment of at least one full-time staff member); and Japanese language ability (either the applicant or a full-time staff member must have Japanese language proficiency equivalent to level B2 or above) (a virtual office is not permitted). (The requirements for obtaining the Business Manager visa were tightened in October 2025.)

Corporate governance structure: A minimum structure with only one director is also possible. In addition, where the company grows to a certain size, the following corporate organs may be established.

・Board of directors (torishimariyaku-kai): At least three directors are required. This is worth considering where you wish to enhance the company’s credibility with business partners.

・Company auditor (Kansayaku): Where a board of directors is established, appointing a company auditor is in principle mandatory; however, a private company (a company whose shares are subject to transfer restrictions) may choose not to appoint one.

2．Deciding the Company Name and Business Purposes

・Rules for the company name (Shougo): Alphabetic characters may also be used, but names that could be mistaken for those of well-known companies, or names contrary to public order and morals, cannot be registered. In addition, registration is not possible where a company with the identical trade name already exists at the identical address (this is rare in practice, but caution is required with virtual offices and the like).

・Business purposes: Make clear “what the company will do.” It is common to state the purposes broadly, including businesses the company may conduct in the future; however, where the company will engage in a business requiring a license or permit (secondhand goods dealing, travel agency business, food and beverage services, etc.), the permit will not be granted unless specific wording is included in the stated purposes, so advance confirmation is essential.

3．Required Documents When a Foreign Director or Foreign Company Becomes a Shareholder

Where a foreign national who has no resident record (juminhyo) in Japan, or an overseas corporation, is involved in the incorporation, they cannot obtain a Japanese “seal registration certificate” (inkan shomeisho). In its place, a “signature certificate” issued in the home country is required.

The point requiring the greatest care in practice here is the scope of authentication (i.e., whether an apostille is required).

Even where the Legal Affairs Bureau says that an apostille is “not required,” you will almost invariably be asked for an apostille when you subsequently open a bank account. To avoid having to do the work twice, the golden rule is to obtain a signature certificate with an apostille attached from the outset.

4．Capital Payment and Scheduling Points

The incorporation procedure usually takes approximately two weeks to one month from the time the documents are complete and the registration documents are filed with the Legal Affairs Bureau until registration is completed.

・Timing of capital payment: This must be done before the registration application is filed. Because no account in the “company’s name” yet exists, the capital is paid into the “personal Japanese bank account” of an incorporator or the representative. The name of the remitter is not questioned.

・Remittance from overseas: Where funds are remitted directly from abroad, it may take from several days to one week for the funds to arrive. Remittance fees and foreign exchange fees may be incurred. Because it is necessary to prove to the Legal Affairs Bureau that the capital is in the account, remit funds so that the amount received does not fall below the amount of the capital. In addition, the bank may contact you to confirm the source of the funds, so schedule management with ample time to spare is necessary.

5．Opening a Corporate Bank Account

The process is not complete once registration is finished. At present, the screening for opening a corporate account at a Japanese bank is extremely strict.

Need for a Japanese-speaking contact person: Many banks strongly require that, even where the representative is a foreign national, there be a “contact person who resides in Japan and can communicate with the bank in Japanese.” Without this, in some cases the application does not even make it to the screening stage.

Proof of substance: In the case of a virtual office, the screening becomes extremely strict. It is indispensable to prepare items such as an office lease agreement, a business plan, and a Japanese-language website.

6．Post-Investment Report / Prior Notification Under the Foreign Exchange and Foreign Trade Act

Where a foreign investor incorporates a Japanese company (acquires its shares), the investor must file a report with the Minister of Finance and the other competent ministers, via the Bank of Japan, under the Foreign Exchange and Foreign Trade Act (FEFTA).

・Prior notification: Where the business falls within “sectors relevant to national security,” such as weapons manufacturing, energy, and software (in part), a notification must be filed before the company is formed, and the investor must wait for the review to be completed (in principle, 30 days). Incorporating a company without knowing this constitutes a violation of these regulations, so checking the relevant business sectors in advance is essential.

・Post-investment report:  For most business sectors, it is sufficient to file a report within 45 days after incorporation.

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