Last reviewed October 7, 2026 · By the NYBACS advisory team
Short answer
Foreign founders usually incorporate in Japan as a Kabushiki Kaisha (KK, a stock company) or a Godo Kaisha (GK, a limited liability company), registered at the Legal Affairs Bureau. A KK's articles must be certified by a Japanese notary; a GK's need not be. There is no resident-director requirement and capital can legally be as low as one yen, but bank accounts and the Business Manager visa carry much higher practical thresholds.
Key takeaways
- The KK is the familiar choice for credibility and future fundraising; the GK is cheaper and simpler to form and run.
- A company is incorporated on the date its registration application is filed with the Legal Affairs Bureau (homukyoku).
- Since 2015 Japan has not required a representative director to live in Japan, although banks often still prefer one.
- Foreign investors generally file a post-investment report under the Foreign Exchange and Foreign Trade Act, while designated sectors require prior notification.
- The Business Manager visa was tightened from 16 October 2025, including a capital requirement of JPY 30 million alongside staffing, experience and business plan conditions.
Japan at a glance
| Common entity for foreign owners | Kabushiki Kaisha (KK) or Godo Kaisha (GK); branch or representative office in specific cases |
|---|---|
| Company registry | Legal Affairs Bureau (homukyoku), Ministry of Justice |
| Foreign ownership | Up to 100% generally; FEFTA prior notification for designated sectors, post-investment report otherwise |
| Local director / resident requirement | No resident representative director required since 2015 (branches need a representative with a Japanese address); banks often prefer one |
| Registered office | Head office address in Japan; banks and visa authorities generally expect a real office |
| Key tax registrations | National tax office, prefectural and municipal notifications; consumption tax and qualified invoice registration; social and labour insurance |
| Recurring compliance | Annual corporate tax return within two months of year-end, consumption tax returns, officer term re-registrations, KK balance sheet publication |
| Typical setup timeline (indicative) | About three to six weeks to registration; bank account and visa can take considerably longer |
Indicative only. Rules, filings, fees, ownership restrictions and timelines vary and change — confirm the current position before acting.
KK, GK, branch or representative office?
| Option | Formation | Best for |
|---|---|---|
| Kabushiki Kaisha (KK) | Notarised articles, registration at the Legal Affairs Bureau | Customer-facing businesses, future investors, credibility with large Japanese companies |
| Godo Kaisha (GK) | No notarisation; simpler governance | Wholly owned subsidiaries, holding and IP vehicles, cost-sensitive start-ups |
| Branch (shiten) | Registered; needs a representative in Japan with a Japanese address | Groups that want the parent to contract directly |
| Representative office | Not registered; no revenue-generating activity | Market research and liaison |
Many multinationals use a GK for wholly owned subsidiaries because it is cheaper and has no fixed director terms. Founders selling to conservative Japanese corporates or planning equity rounds usually choose a KK.
Step-by-step: incorporating a KK
- Decide the basics: trade name, head office address, business purposes, capital, fiscal year and officers.
- Make a company seal (inkan) for registration documents and banking.
- Draft the articles of incorporation (teikan) and have them certified by a notary public (koshonin). A GK skips this step.
- Pay in capital to a bank account of the promoter or a director, then prepare the payment certificate. Accounts at Japanese banks, or at Japanese branches of overseas banks, are generally accepted; foreign founders without Japanese residency often use a co-promoter's or director's account.
- File the registration application at the Legal Affairs Bureau. The filing date becomes the incorporation date; the register is typically updated within one to two weeks.
- Obtain the certificate of registered matters and seal certificate for banking and contracts.
- Post-incorporation filings: tax office notification and blue-form return application, prefectural and municipal tax notifications, social and labour insurance, and the foreign investment report.
Indicatively, a KK takes three to six weeks from document preparation to registration, depending on how quickly foreign signatures and certificates are obtained.
Documents for foreign shareholders and directors
Japanese procedures rely on registered seals. Foreign individuals who are not resident and have no registered seal provide signature certificates (sworn statements of signature) notarised in their home country, or by their embassy in Japan. Corporate shareholders provide a certificate of corporate existence or affidavit confirming name, address and representative, with a signature certificate for the representative.
Japan is a party to the Apostille Convention, so documents from other Convention countries can be apostilled where an official authentication is required. Japanese translations are needed for foreign-language documents filed with the Legal Affairs Bureau.
FEFTA reports, tax and social insurance
Under the Foreign Exchange and Foreign Trade Act (FEFTA), a foreign investor establishing a Japanese company generally files a post-investment report through the Bank of Japan within 45 days of the investment. Prior notification is required if the business is in designated sectors, such as defence-related, telecoms, cybersecurity and some infrastructure activities, and the investment cannot proceed until the waiting period ends.
The company files notifications with the national tax office, prefecture and municipality, and applies for blue-form filing to access tax benefits. It pays national corporate tax plus local taxes. For consumption tax, currently 10% standard and 8% reduced, a new company should decide early whether to register as a qualified invoice issuer, because many Japanese business customers expect a registration number on invoices. Companies register with social insurance (health and pension) and labour insurance when they pay officers or employees.
Banking: the real bottleneck
Opening a corporate bank account is often the hardest step. Japanese banks look for a real office (not only a virtual address), a resident representative director, a clear business plan, Japanese customers or contracts, and full beneficial-owner documentation. Companies with only non-resident directors, very low capital or a virtual office are frequently refused or asked to wait. Online and regional banks may be more flexible, but there is no guaranteed route, so plan banking alongside incorporation.
Ongoing compliance and whether Japan is the right base
A Japanese company files its corporate tax returns within two months of year-end (with an extension available in some cases), files consumption tax returns once registered, withholds tax on salaries and certain payments, and registers changes to officers or addresses. KK directors have fixed terms, so reappointments must be registered even when the same people continue, and a KK must publish its balance sheet each year.
Japan suits businesses that need direct access to Japanese customers and partners, who generally value a local entity. If your aim is a regional hub, Singapore or Hong Kong is simpler. South Korea is the usual comparison for a second North Asian market.
Common mistakes to avoid
- Choosing a KK only for prestige when a GK would meet a wholly owned subsidiary's needs at lower cost.
- Not arranging a Japanese bank account to receive the capital payment before filing.
- Leaving FEFTA analysis until after investing, when the sector required prior notification.
- Assuming a virtual office and nominal capital will satisfy banks and immigration authorities.
- Forgetting to re-register KK directors when their terms expire, which can lead to fines.
- Delaying the qualified invoice registration decision until customers start asking for the number.
Documents and records to prepare
- Signature certificates for non-resident individual promoters and directors
- Certificate of corporate existence or affidavit for corporate shareholders, apostilled where required
- Board resolution of the parent approving the investment
- Passport copies of officers
- Head office lease or address documents
- Japanese translations of foreign-language documents
- Capital payment evidence from a Japanese bank account
NYBACS 360° support
How NYBACS helps
- Compares KK, GK and branch options against your customers, fundraising plans and budget.
- Coordinates our Japanese partner, including the notary and judicial scrivener, for articles and Legal Affairs Bureau registration.
- Organises signature certificates, apostilles and translations.
- Flags FEFTA prior-notification issues and coordinates tax, social insurance and invoice registrations.
- Prepares a bank-ready corporate profile and KYC pack for Japanese banks.
Frequently Asked Questions
Can a non-resident be the only director of a Japanese company?
Yes. Since 2015, a KK or GK may have only non-resident representative directors. In practice, banks often prefer a resident representative, which affects account opening.
What is the minimum capital?
Legally, one yen. In practice, capital affects credibility, banking and visa eligibility; the Business Manager visa now requires JPY 30 million plus other conditions.
Do I need a Business Manager visa to own a Japanese company?
No. Owning shares or being a non-resident director does not require a visa. You need a suitable status of residence only if you will live and work in Japan.
Does a GK need notarised articles?
No. Notary certification is required for a KK's articles but not a GK's, which is one reason GKs are quicker and cheaper to form.
What is the FEFTA report?
It is a filing under Japan's Foreign Exchange and Foreign Trade Act. Most new foreign investments are reported after the investment, but designated sectors require prior notification and a waiting period.
