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 185 economies. The most recent round of data collection was completed in June 2012.

Compare Japan to 184 other economies.

YearNew business densityNumber of new limited liability companies
2011 1.1089,374

  • Standardized Company

  • Legal Form: Godo Kaisha
  • Paid in Minimum Capital Requirement: JPY 1
  • City: Tokyo

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No. Procedure Time to Complete Associated Costs
1 Make a company seal

Have a representative member’s or executive officer’s seal made by the seal carver
3 days JPY 20,000
2 Acquire certificate of seal registration of representative managing member at the Ward office

To register the company, the representative managing member (natural person) must provide the certificate of seal registration with the Legal Affairs Bureau. The fee is levied by each ward office, and thus varies from ward to ward, but is about JPY 400 per certificate of seal registration.
1 day JPY 400 (each)
3 Register at the head office or a branch of the Legal Affairs Bureau of the Ministry of Justice

An application for company registration together with supporting documents is required to be filed with competent branch of the legal affairs bureau. Supporting documents include Articles of Incorporation. Filed documents can be returned for revisions. When the documents are accepted, the company applies for an issuance of the company registration and the certificate of seal registration at the same location of the Legal Affairs Bureau of the Ministry of Justice.
Generally, a judicial scrivener would be asked to complete the registration procedure.
By virtue of the amended Commercial Registration Regulations, which took effect in June 2004, online application for commercial corporation registration is available. In order to use this system, the user must obtain a digital certification of the user's digital signature. There are two types of digital certifications, data file and IC card. The user must purchase an IC card reading device to use IC card.
As of 1st February, 2012, there are 110 registry offices which have jurisdiction over commercial registration (including branch offices) designated in major cities (for example, Tokyo, Yokohama, Osaka, Nagoya, Kobe, and Fukuoka).
1-3 weeks 0.7% of the capital amount or JPY 60,000, whichever is higher
4 File notification of the incorporation of a company, the opening of a payroll office, and application for the approval of blue tax returns with District Tax Office.

The notification of the incorporation of a company must be filed within 2 months of the date of incorporation. The notification of the opening of a payroll office must be filed within a month of the opening of a payroll office. The application for the approval of blue tax returns must be filed within 3 months of the date of incorporation or after the ending day of the first fiscal year, whichever comes first.
1 day no charge
5 File notification of the commencement of business with the local tax office (the office of local or prefectural government)

The company must file the notification of the incorporation of a company within 15 days of the incorporation of the company.
1 day no charge
6 File notifications of commencement the applied business and labor insurance, and the rules of employment with the Labor Standards Inspection Office.

When a Godo Kaisha hires an employee, the employee is automatically put under a labor insurance scheme (i e. employment insurance and worker's compensation insurance), and the following documents must be filed with the competent Labor Standards Inspection Office:

• A report of the commencement of labor insurance must be filed within 10 days of the start date of the labor insurance.
• Notification of applied business must be filed without delay after the start of business operations

The rules of employment must be filed with the Labor Standards Inspection Office, without delay, once the company employs 10 or more employees.

In addition, the company must file an agreement on overtime or holiday work (a "36 agreement") in advance if the company anticipates its employees will undertake overtime work or will engage in work on official holidays, irrespective of the number of employees.
1 day no charge
7 File applications for health insurance and public welfare pension with the Japan Pension Service

Notification of New Coverage under Health Insurance/Employees' Pension Insurance and Notification of Acquisition of Insured Status under Health Insurance/Employees ' Pension Insurance must be filed with the Social Insurance Office within 5 days from the day of becoming a covered business establishment.
1 day no charge
8 File application for business establishment of employment insurance with the Public Employment Security Office

"Notification of Creation of Business Establishment Covered by Employment Insurance" must be filed with the Public Employment Security Office within 10 days from the day following commencement of employment. When a newly employed worker is covered under employment insurance, a "Notification of Acquisition of Insured Status under Employment Insurance" must be filed with the Public Employment Security Office by 10th day of the month immediately following the month of his/her employment.
1 day no charge
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