Setting up a company in Japan
Types of business investments in Japan
Unlike the establishment of a branch, a representative office is not allowed to conduct direct business activities, nor can it open a bank account on its own, or rent real estate in Japan. Thus, only establishing a business in Japan with foreign investment capital or a representative of a representative office with an authorized individual role has the right to sign and carry out these activities. The activities that the representative office in Japan is allowed to do can be mentioned as market investigation, purchase of goods, propaganda and advertisement, collection of information, etc. Therefore, investment business activities can be classified into the following investment forms:
Investment through establishment of a company in Japan in the form of a legal entity
Similar to Vietnam, the types of legal entities when establishing a company in Japan include 4 common types:
- One member limited liability companies and two or more member limited liability companies (referred to as 有限会社)
- Private company (referred to as 合資会社 )
- Joint Stock Company (referred to as 株式会社)
- Partnership (referred to as 合名会社)
In addition, investment to Japan can also be made by other forms such as:
- Establishment of a subsidiary. Investors can choose to establish a business in Japan in the form of a subsidiary such as a shareholding or a limited liability company in accordance with the Company Law in Japan. Perhaps because of the same civil law system, so similar to Vietnam, the foreign company only needs to be responsible for the rights and obligations arising from the operation of the subsidiary as an owner according to regulations. of Japanese law. Foreign individual investors can also set up companies in Japan.
- Joint venture with investment companies, contributing capital to Japanese enterprises or domestic Japanese enterprises. The Japanese Enterprise Law recognizes partnerships and syndicates as legal entities, so this form of investment when establishing a business in Japan is completely feasible.
Invest through establishing a branch in Japan
Some foreign enterprises operating regularly in Japan are required to register under the Companies Act 2005. Specifically, it is necessary to register at least 01 of the following forms:
- Registration of cooperative groups;
- Register to establish a branch;
- Register a Japanese legal entity or;
- Register to appoint a representative in Japan.
The most typical is the establishment of a company in Japan in the form of opening a branch because of the convenience and ease in the procedure for establishing this type of investment as well as the ability to open a bank account and rent real estate with the name of a bank. branch meaning. However, the branch has no legal status, so the responsibility related to the rights and obligations from the branch’s activities will belong to the foreign enterprise, including the liability for debts and revenues. arising from the activities of these branches. So there are many forms of business investment in Japan, each with its own advantages and disadvantages. Depending on the purpose of the company, businesses can choose the appropriate form of business investment.
Which subject in Vietnam can invest in Japan?
Vietnamese law allows the following 06 groups to make investments from Vietnam to abroad, namely Japan:
- Household business. For example, Bao Phuong Mooncake (Thuy Khue, Hanoi).
- Other organizations conduct business investment in accordance with Vietnamese law. For example: Kinh Do Co., Ltd
- Credit institutions may establish businesses in Japan and operate in accordance with the Law on Credit Institutions. For example, Vietcombank, Shinhan bank branch.
- Cooperatives and unions of cooperatives are established and operate in accordance with the Law on Cooperatives. For example, the Biopharmaceutical Cooperative (soap production)
- An investment enterprise establishes an enterprise in Japan and operates under the provisions of the Enterprise Law and the Investment Law. For example, VinFast Trading and Service Co., Ltd
- Individuals holding Vietnamese nationality, except for the case specified in Clause 2, Article 17 of the Enterprise Law.
These subjects also need to meet some investment conditions in Japan as follows:
- Investment in Japan must be consistent with the state’s purpose in encouraging investment.
- Investors are obliged to comply with not only domestic and Japanese laws but also relevant international laws.
- Business lines that are not in the industries and trades prohibited from investing in Japan and meet the conditions for investment in Japan for the investment sectors and trades that are set by Japanese law.
- Investors must have a financial commitment, arrange foreign currency by themselves or make a commitment to arrange foreign currency
- There is a document from the tax authority certifying the investor’s fulfillment of tax payment obligations. The time of certification by the tax authorities is not more than 03 months from the date of submission of investment project dossiers.
Documents to establish company in Japan
Documents for foreign individuals:
| No. | Document Type | Number of documents | Note |
| 1 | Certificate of seal (also known as “ikan shomeisho): Issued within 03 months, this is a mandatory document for investors when they hold the position of director. In some cases, the Certificate of Seal can be replaced by a certified copy of the signature issued by the Embassy/Consulate of the foreign investor’s country in Japan or the Notary Service. | 2 | A notarized copy |
| 2 | On all Japanese Enterprise Registration Certificates and other relevant documents, signatures (or seals) of all investors and directors are required. | ||
| 3 | Company Seal: Must be registered at the Registrar’s Office | ||
| 4 | Personal account and savings book (tsucho) of one of the representative investors depositing charter capital. Investors can use an existing account or open a new account. Some postal savings accounts such as Citibank, Japan Net Bank, E-Bank, Shinsei, etc. are still accepted. |
Document for foreign company
| No. | Document Type | Number of documents | Note |
| 1 | Certificate of registration of the parent company. Granted within 3 months | 01 | Original or Certified Copy |
| 2 | Confirmation signature of the representative of the parent company
Confirmation signature of the representative of the parent company in case the representative of the parent company is or becomes a director of a subsidiary in Japan. |
02 | Notarized
A notarized copy |
| 3 | Certificate of seal (aka “ikan shomeisho) | 02 | A notarized copy |
| 4 | On all Japanese Enterprise Registration Certificates and other relevant documents, signatures (or seals) of the representative of the parent company and each director are required | ||
| 5 | Company Seal: Must be registered at the Registrar’s Office | ||
| 6 | Personal account and savings book (tsucho) of one of the representative investors depositing charter capital. |
Process and procedures for applying for an investment license to establish a company in Japan for Vietnamese people
For Vietnamese enterprises that want to invest in Japan, they need to carry out two main activities in the country and in Japan to complete the investment procedures to establish a company in Japan.
Process 1: Initial domestic procedures
Step 1: Vietnamese investors must meet the following conditions for applying for a new project:
Investment to establish a company in Japan in industries that are not on the list of industries banned from investment as well as meet the specific conditions of each conditional investment industry such as Advertising, insurance, bailiff ,..etc
Self-actualization of foreign currency or self-arrangement of foreign currency by authorized credit institutions according to a commitment
Having a decision to invest in Japan for Vietnamese investors (according to the Law on Enterprises, of the agency deciding foreign investment in State-owned enterprises).
There is a document from the tax authority proving the investor’s tax payment obligation. The time for tax authorities to approve is 3 months from the date of submission of investment project dossiers.
Step 2: Apply for approval of investment policy (if it is required to apply for approval of investment policy) Some cases need to apply for approval of investment policy, including investment projects to establish a business. businesses in Japan with a huge amount of capital, from 20 trillion VND or more/projects with a special mechanism that the National Assembly needs to intervene to approve, or smaller projects with a capital of 800 billion VND or more/projects with business lines and capital conditions of 400 billion VND or more.
Step 3: Submit an application for the Investment Registration Certificate (IRC)
For projects that need approval of investment policy: within 05 working days from the date of receipt of the written approval of investment policy and decision to invest abroad, the competent authority will issue the Investment Registration Certificate to Japan for investors who do not need to apply for an IRC.
For projects that do not apply for investment policy approval: the working time is 15 days from the date of receiving the dossier.
Process 2: Procedures for applying for a license for an investment project in Japan
Step 1: Select a representative director who is a citizen residing in Japan and a certain office address.
Step 2: Establish a charter to establish a company in Japan (teikan)
Step 3: Authentication of business establishment charters in Japan at Japanese notary offices Authentication of charters is only required for joint-stock companies, and limited liability companies do not need to be notarized.
Step 4: Deposit money in the bank. The company can only open a bank account after completing the registration procedure, so an alternative is to use the personal Japanese bank account of one of the investors or a personal account. of the Representative Director (if it is a subsidiary).
Step 5: Prepare documents to establish a company in Japan: Foreign-invested individuals or businesses who want to invest in Japan will have to prepare a set of documents including the above-mentioned documents.
Step 6: Fill out the company registration form at the Registration Office in Japan
Step 7: Complete registration Once the registration procedure is completed, the foreign investor will receive a Certificate of Registration and Certificate of Company Seal. Accordingly, investors need to preserve these documents well to avoid loss because when opening a bank account, or signing a contract, they are all required to present these documents.
Process 3: Follow-up procedures in the country
- Apply for an ERC if required by Japanese law.
- Open a bank account in the name of the company storing offshore investment capital at a Vietnamese credit institution. This is a foreign currency account that investors need to set up at an authorized credit institution in Vietnam as well as register to transfer foreign currency abroad.
- Register for foreign exchange transactions at the State Bank
- Transfer investment capital to Japan to carry out investment activities to establish a business in Japan
- Apply for Visa, residency status for company officials without Japanese nationality (eg Director, employee, ..)
- Notice of offshore investment at Foreign Investment Department, State Bank, Embassy/Consulate General of Vietnam in Japan
- Notes when investing to establish a company in Japan
About business sectors allowed to invest in Japan
Regulations related to investment in Vietnam contain provisions on industries and trades that are prohibited from investing abroad and industries and professions with conditional outward investment. Not only that, when investing to establish a business in Japan, any business with or without conditions must comply with Japanese law if it is in a conditional investment industry under Japanese law. determined. According to Vietnamese law, the following industries and professions are prohibited from investing in establishing enterprises in Japan:
- Drug; firecrackers; debt collection services; chemicals and minerals; specimens of wild plant and animal species extracted from nature; specimens of endangered, precious and rare species of forest plants, animals and aquatic animals of Group I, which are exploited from the wild; prostitution; buying and selling human, tissues, corpses, human body parts, human fetuses; business activities related to human cloning; and industries and trades prohibited from doing business in accordance with relevant international treaties.
- Industries and trades with technologies and products banned from export according to the provisions of law on foreign trade management.
- Sectors and trades prohibited from doing business in accordance with Japanese regulations.
The conditional investment industries and trades include 05 industries and trades: Securities; Insurance; Bank; Press, radio, television and Real estate business.
Investment capital to Japan
Lawful sources of capital invested in Japan include investors’ money and other legal assets, more specifically:
- Intellectual property rights (copyright, copyright-related rights, ..);
- Equity;
- Profits earned from offshore investment projects shall be retained to continue conducting overseas investment activities; loans in Vietnam are transferred abroad;
- Money and other assets include: Shares; capital contribution; Currency; VND; fixed assets, finished goods, semi-finished goods; investors’ projects are swapped at economic organizations in Vietnam and economic organizations abroad; legal property according to the provisions of civil law.
Transfering investment profits from Japan to Vietnam
Investors must repatriate profits (except for the case where they continue to contribute capital for investment abroad because they have not yet fully contributed capital as registered; increase investment capital abroad; or to implement new investment projects in the home country). outside) within 6 months from the date of the tax finalization report or equivalent legal document. If they do not transfer within the prescribed time limit, they must notify the Ministry of Planning and Investment in writing, otherwise they will be fined or overcome the consequences (if any) as prescribed by law. Time limit for repatriation of profits: up to 12 months.
Applying for a Business Visa to Japan
As mentioned, one of the last important steps of the investment procedure is applying for a Business Visa. This can be seen as a decisive step in whether investors can make investment in Japan after a long process of preparing for investment in Japan. So for the highest rate of business Visa application, as well as to save time, please refer to the following procedures and notes:
- Business Visa is a type of Visa for individuals or organizations who want to invest, do business or manage business activities in Japan. If you’re just buying real estate for your stay or vacation, a Business Visa won’t be for you. In addition, if you do not stay or work in Japan, you cannot apply for a visa as a business or manager, but you need to apply for another type of visa.
- On the other hand, as previously stipulated, the business visa will allow the visa recipient to spend 4 months in Japan to complete the procedures for registering a company in Japan and converting the visa. However, now, this regulation has been relaxed, Japan allows foreigners residing abroad (for example, investors who are in Vietnam and have not been to Japan) to establish companies in Japan. without having to go to Japan.
- Those who do not need to apply for a business visa but can still establish a business in Japan: Foreigners staying in Japan with a work visa, family visa or student visa who want to do business in Japan If you want to do business or manage a business in Japan, you must change to a business and management visa; Persons with permanent resident status; Persons married to foreigners; The person who marries a person with permanent resident status; Persons with permanent resident status; People with high professional qualifications and satisfying certain requirements in terms of income, education, and professional qualifications
Visa application procedures: After being granted Enterprise Registration Certificate in Japan, foreign investors need to prepare documents to apply for a Visa.
Dossier to apply for a Visa to Japan for business
| No. | Types of documents | Number of documents | Note |
| 1 | Photo 3×4 | 01 | Taken within 03 months before submitting the application |
| 2 | Feedback envelope (specify address and attach price tag 404 yen, note this price is subject to change) | ||
| 3 | Business plan (if there are many members in the company, the position of each person must be clearly stated) | Copy | |
| 4 | Business registration certificate (if not registered, a copy of the articles of incorporation in Japan is required) | Copy | |
| 5 | Office lease contract for business use | Copy | |
| 6 | Financial statement (if you have started a business, you must declare a specific salary statement) | Copy | |
| 7 | Documents proving the source of investment capital | ||
| 8 | Documents proving that the company’s employees must be 2 or more Japanese, or the person who is married to a Japanese, or the person with the status of permanent resident, or the person who is married to the person with the status of permanent resident, or the person with the status of permanent residence, and must work full time – full time | ||
| 9 | Salary sheet, shareholder meeting minutes | Copy | |
| 10 | Depending on the type of business, you must submit a number of additional requirements specified by the Department of Food Safety and Hygiene, the Department of Real Estate, etc. |
Place of application: Embassy and Consulate General of Japan in Vietnam; or Entrusted Agents including VFS Global and 14 travel agents.
Consulting service for setting up a company in Japan
| Free | Consulting on establishing a business in Japan on contracts, corporate law provisions, investment laws in Japan, etc. |
| Supports | Issues related to recruitment, employment, and residence of foreigners in Japan in accordance with the law |
| Service offer | Answer tax issues when establishing a company in Japan & regular legal advice on: PIT, CIT… |
| Experience | >10 years. A team of highly qualified lawyers with many years of investment consulting experience in Japan. |
| Fee | Competitive prices, no costs…and many other added values that exceed customers’ expectations |
For a free comprehensive consultation on the establishment of a foreign-invested study abroad counseling company, please contact:
Phone: (+84) 961 366 238
Email:
- vphn@siglaw.com.vn
- vphcm@siglaw.com.vn
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