How to Set Up a Company in Japan? What Documents Are Needed?

 Set Up a Company in Japan

Establishing a foreign-owned company in Japan involves adhering to legal procedures, managing corporate requirements, and navigating cultural differences and market competition. Despite challenges, success can yield abundant business opportunities and growth prospects.

I. Japanese Company Type

When establishing a company in Japan, companies are divided into four types according to the Company Law: “joint stock company”, “limited liability company”, “partnership company” and “joint venture company”.

• Kabushiki Kaisha: 
  A joint-stock company refers to a business where investors are called "shareholders" at the time of establishment or capital increase, and "shares" are issued corresponding to their investment amount to raise capital (working capital).
• Godo Kaisha: 
  In a contract company, the investors are referred to as "members," meaning they are both "investors" and "operators." Unlike in a traditional company, there is no need to go through the process of "selecting directors through a general meeting of shareholders." In this structure, the "investor" is also the "company manager," which is the key difference from a limited company (Co., Ltd.). Essentially, "all members have equal voting rights in management."

II. Documents should be prepared for company establishment

• Confirm company type
  Confirm the type to be registered, such as joint-stock companies or limited liability companies.
• Company Name
  Basically, you are free to choose the name, but it is important to verify in advance with the Legal Affairs Bureau in the company’s jurisdiction to ensure there is no existing business name that is similar.
• Determine the Amount of Capital
  One key concern when setting up a company is the required capital. In Japan, capital must be fully paid, and it represents the company's reputation. A larger capital is seen as a sign of financial strength, especially for newly established companies, where capital serves as an important indicator of credibility.
• Management items
  A company can only carry out activities outlined in its articles of association. If a business is not immediately executed at establishment but may occur later, it should be specified in advance. The articles may include "all businesses related to or incidental to the preceding paragraph" at the end of the business purpose.

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