Japan

Starting a Business in

Japan

Below is a detailed summary of the bureaucratic and legal hurdles faced by entrepreneurs wishing to incorporate and register a new firm in Japan. It examines the procedures, time and cost involved in launching a commercial or industrial firm with up to 50 employees and start-up capital of 10 times the economy's per-capita gross national income.

This information was collected as part of the Doing Business project, which measures and compares regulations relevant to the life cycle of a small- to medium-sized domestic business in 189 economies. The most recent round of data collection was completed in June 2013.

Compare Japan to 188 other economies.

  • Standardized Company

  • Legal Form: Godo Kaisha
  • Paid in Minimum Capital Requirement: JPY 1
  • City: Tokyo
No. Procedure Time to Complete Associated Costs
1 Make a company seal

The company seal is required by law: Article 20 of the Commercial Registration Act. The associated fee is JPY 10,000 for machine-carved seal or JPY 20,000 for hand-carved seal.
3 days JPY 10,000 - JPY 20,000
2 Obtain the certificate of seal registration from the Ward office

The entrepreneur or company representative (natural person) must register the company seal and obtain the certificate of seal registration from the Ward office. This certificate must be submitted to the Legal Affairs Bureau at the Ministry of Justice upon registration. The levied fee is approximately JPY 400 per certificate of seal registration, but varies from ward to ward.
1 day JPY 400 (each)
3 Register at the Legal Affairs Bureau of the Ministry of Justice

To apply for registration, the entrepreneur submits a duly completed application form, along with supporting documents including the certificate of seal registration and the Articles of Incorporation. This can be done at the Legal Affairs Bureau headquarter or any of its branch offices designated in major cities (Tokyo, Yokohama, Osaka, Nagoya, Kobe, and Fukuoka). Once the filed documents are reviewed and approved, the company applies for the issuance of a company registration certificate. Normally, a judicial scrivener completes this registration procedure on behalf of the company.

By virtue of the amended Commercial Registration Regulations in force since June 2004, company registration applications can be submitted online. To do so, the user must first obtain an electronic signature or a digital certification. There are two types of digital certifications: data file and IC card. The user must purchase an IC card reader to use the IC card system.
1-3 weeks 0.7% of the capital amount or JPY 60,000, whichever is higher
4 File the notification of company incorporation and the opening of a payroll office; and Apply for the approval of blue tax returns at the District Tax Office

The notification of the company incorporation must be filed within 2 months of the incorporation date.
The notification of opening a payroll office must be filed within one month of the opening of a payroll office.
The application for the approval of blue tax returns must be filed either within 3 months of the incorporation date, or a day prior to the end of the first fiscal year, whichever comes first.
1 day no charge
5 File the notification of commencement of business at the tax office of the municipal or prefectural government

If the head office of the company is located within Tokyo’s 23 wards, the company must file a Notification for the Commencement of Business at the tax office of the Tokyo Metropolitan Government within 15 days of company incorporation.
If the head office of the company is located outside Tokyo’s 23 wards, the company must file a Notification of Incorporation at the tax office of the municipal government and the tax office of the prefectural government within 1 month of company incorporation.

1 day no charge
6 File the necessary labor insurance notifications and employment rules at the Labor Standards Inspection Office

Employees are automatically provided with labor insurance as soon as they are hired. Labor insurance usually includes employment and worker's compensation insurance.

Upon recruitment, the company must file without delay the following documents at the competent Labor Standards Inspection Office:
• Notification of the application for labor insurance
• Notification of the commencement of labor insurance within 10 days of the insurance coverage commencement date
• Notification of the approximate insurance contributions within 50 days of the insurance coverage commencement date
• The rules of employment (once the company hires 10 or more employees)
• Agreement on overtime and holiday work (the "36 agreement") if the company anticipates that its employees will work overtime or on public holidays, irrespective of the number of employees
1 day no charge
7 File the applications for health insurance and public welfare pension at the Japan Pension Service

As soon as the company and its employees are covered for health insurance and public welfare pension, the company must file the following documents at the Social Insurance Office within 5 days of the business insurance coverage commencement date:
- Notification of the acquisition of insured status
- The insurance details covering Health and Employee Pension insurance

Less than one day (online procedure) no charge
8 File the company application for employment insurance at the Public Employment Security Office

The notification of the company's application for employment insurance must be filed at the Public Employment Security Office within 10 days of commencement of employment by the company.
When a new employee is recruited, he/she is automatically insured under the company's employment insurance. The company must thus file a "Notification of Acquisition of Insured Status under Employment Insurance" at the Public Employment Security Office by the 10th day of the month immediately consecutive to that of the employee's appointment date.
Less than one day (online procedure) no charge

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