🇯🇵 Complete Guide to Company Formation in Japan for Foreign Nationals and Foreign Corporations: From Foreign Exchange Law Notifications to Latest Visa Requirements

[Supervised by Shionaga Administrative Scrivener Office]

Introduction

Entry into the Japanese market is currently one of the most strategic choices for overseas entrepreneurs and foreign corporations. Japan, the world’s third-largest economy, offers innovative business opportunities in sectors such as pharmaceuticals, IT, tourism, and digitalization as of 2025.

While foreign nationals and foreign corporations can establish legal entities under Japanese corporate law, the procedures are extremely complex due to unique requirements not applicable to Japanese nationals, including status of residence (visas), notifications under the Foreign Exchange and Foreign Trade Act (Foreign Exchange Act), and capital contribution payments.

This article is supervised by experts at Shionaga Administrative Scrivener Office based on extensive practical experience. Fully reflecting the latest information as of February 2026, particularly reporting obligations under the Foreign Exchange Act (for investments of 1% or more) and the strict amended requirements for Business Manager visas (enforced on October 16, 2024), we provide step-by-step explanations from feasibility of establishment to procedural flow, Bank of Japan notifications, and required documentation.

Based in Kumamoto with nationwide support, our office provides one-stop services from company formation to visa applications and Foreign Exchange Act procedures. We also handle case analysis and reapplication for past rejections. To ensure successful entry into Japan, please feel free to contact us first.

Free Consultation: 📞 096-385-9002 or 📧 info@shionagaoffice.jp

1. Feasibility of Company Formation in Japan by Foreign Nationals (Foreign Corporations)

In conclusion, foreign individuals and foreign corporations can establish legal entities under Japanese corporate law in the same manner as Japanese nationals. There are no restrictions based on nationality or residence.

However, compliance with the following critical requirements and preparation for smooth business commencement are essential.

Requirement	Details	Important Practical Considerations
Non-Resident Representative Director	Formation is possible even if all directors reside overseas (non-residents).	Notification via the Bank of Japan is mandatory under the Foreign Exchange Act.
Status of Residence	Formation itself is possible. However, business management activities involving compensation require appropriate status of residence such as “Business Manager.”	Illegal employment is severely punished (imprisonment up to 3 years or fine up to 3 million yen).
Foreign Exchange Act Application	Investment of 1% or more by non-residents constitutes “inward direct investment.”	Violation of reporting obligations is subject to penalties (imprisonment up to 5 years or fine up to 5 million yen) and share disposal orders.

2. Choice of Corporate Structure: Kabushiki Kaisha vs. Godo Kaisha

The main options are Kabushiki Kaisha (Stock Company) with high social credibility and Godo Kaisha (Limited Liability Company) with low cost and excellent flexibility.

Item	Kabushiki Kaisha (Mainstream)	Godo Kaisha (Low Cost)
Social Credibility	High (suitable for large-scale business development)	Relatively low (suitable for small businesses)
Formation Costs (statutory fees)	Approx. ¥250,000~ (registration tax ¥150,000~)	Approx. ¥100,000~ (registration tax ¥60,000~)
Organizational Structure	Complex (shareholders’ meeting, board of directors, etc.)	Simple (all members have management rights)
Recommended Formation Method	Promotion formation (promoters subscribe to all shares) is procedurally simple and recommended for non-residents.	–

3. Most Critical Foreign Exchange Act Procedure: Notification Obligation via Bank of Japan

When all representative directors or investors are non-residents, or when non-residents or foreign corporations make an investment of 1% or more, this constitutes “inward direct investment” under the Foreign Exchange Act, triggering the following notification obligations.

🔹 Types of Notifications and Submission Deadlines

Notification Type	Submission Timing	Applicable Cases
Prior Notification	Within 6 months before registration	Specific nationalities or investments in specific industries related to national security or public order.
Post-Event Report (standard)	Within 45 days after registration completion	Standard inward direct investments not requiring prior notification.

🔹 Submission Destination and Penalties

Submission Destination: Bank of Japan (transmitted via the bank to the Minister of Finance and competent ministers)
Notification Documents: Submit “Notification Regarding Acquisition of Shares/Capital/Voting Rights” in triplicate
Penalties: Violation of notification obligations or false reporting is subject to imprisonment up to 5 years or fine up to 5 million yen, and share disposal orders—an extremely critical procedure

4. Steps for Company Formation by Foreign Nationals (Foreign Corporations)

For non-residents, translation and notarization procedures are added, requiring an estimated period of 1-3 months overall.

Step	Details	Notes (for Non-Residents)
(1) Determine Basic Matters	Determine trade name, head office, business purpose, capital, officer composition, etc.	Confirm applicability of Foreign Exchange Act.
(2) Articles of Incorporation Preparation & Notarization	Prepare articles of incorporation and have them notarized at a notary public office. Electronic articles eliminate stamp duty (¥40,000).	Japanese translation is mandatory for foreign language attachments.
(3) Create Corporate Seal	Create representative seal.	Non-residents can substitute with signature certificate.
(4) Capital Payment	Transfer to a domestic Japanese bank account or personal account of a formation collaborator (Japanese resident). Overseas branch accounts are not acceptable.	Considering visa application, ¥5 million or more is recommended.
(5) Formation Registration Application	Apply to Legal Affairs Bureau (completed in about 1 week). Delegation to judicial scrivener is common.	Additional submission of sworn statement required.
(6) Notifications to Relevant Agencies	Notifications to tax office, local government, etc. Complete post-event report under Foreign Exchange Act (within 45 days).	–

5. Lifeline for Foreign Business Managers: Latest Requirements for “Business Manager” Visa (Amended October 16, 2024)

For foreign nationals to conduct business management activities (work involving compensation) in Japan, appropriate status of residence such as “Business Manager” visa is essential. For applications from October 16, 2024 onward, requirements have been strictly tightened as follows.

Requirement	Post-Amendment Details	Practical Countermeasures
Securing Business Office	Independent business office (corporate name, business contract) is mandatory. Virtual offices and home offices are generally not acceptable.	Finalize office before registration and prepare lease agreement.
Funds/Personnel	Total investment of ¥5 million or more, or employment of 2 or more full-time Japanese nationals or permanent residents, etc.	In addition to capital preparation, substantiate employment plan.
Business Continuity	In addition to a concrete business plan, attachment of evaluation report by experts (certified small and medium enterprise management consultant, certified public accountant, tax accountant) is mandatory. Quality of business plan is given utmost importance.	Collaborate with experts to develop highly feasible plans.
Applicant Qualifications	Japanese Language Proficiency Test N2 level equivalent ability, or bachelor’s degree or higher, or 3 years or more of management experience.	–

🔹 Visa Application Process

Formation registration completion → Document preparation → Apply for Certificate of Eligibility to Regional Immigration Services Bureau (examination period: typically 1-3 months) → Obtain visa at overseas diplomatic mission → Enter country and receive residence card

[IMPORTANT] Visa application before registration completion has extremely high risk of rejection as business substance cannot be confirmed.

6. Main Required Documents for Formation and Visa Application

Documents issued by non-residents generally require Japanese translation and notarization.

Category	Main Required Documents	Non-Resident Specific Documents
Formation Registration	Registration application, notarized articles of incorporation, capital payment certificate, letter of acceptance of appointment, corporate seal and seal registration.	Signature certificate (or seal certificate), sworn statement (for non-residents).
Visa Application	Certificate of registered matters, business plan with expert evaluation report, profit/loss plan, office lease agreement and photos, tax office notification (with receipt stamp).	Passport copy, academic background/Japanese language proficiency certificate (N2 equivalent).

7. Shionaga Office’s One-Stop Support System

The complexity of procedures for foreign nationals (foreign corporations) entering Japan represents a significant burden in terms of time and cost. Our office undertakes this complex process in its entirety and ensures business commencement in Japan through collaboration with other professional groups.

Scope of Support: Company formation, Foreign Exchange Act notifications (submission to Bank of Japan), Business Manager visa applications, acquisition of other business licenses and permits

Strengths: Translation of English documents, business plan development support with expert evaluation reports in mind, support for high-difficulty cases and reapplication for past rejections

Our office has overwhelming track record and experience in company formation and visa applications by foreign nationals (foreign corporations).

Shionaga Administrative Scrivener Office

Location: 1-9-6 Suizenji, Chuo-ku, Kumamoto City, Kumamoto 862-0950, Japan
Phone: +81-96-385-9002
Email: info@shionagaoffice.jp

We powerfully support your success in the Japanese market from a legal standpoint.