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Japan Company Formation

"Setting Up a Company in JAPAN" [Forms of doing business]

How a company or an individual sets up operations depends upon the nature and magnitude of the business, as well as legal, tax and other considerations. Many options exist, ranging from a simple Representative Office to Branch office, or local Japanese company and there are several local types of company formations available.

ESTABLISHING A REPRESENTATIVE OFFICE
A"Representative Office" need not to be registered at the legal affairs bureau nor be subjected to corporate tax under Japanese tax laws, except banking or security business. A representative office is not allowed to engage in any commercial transactions.

ESTABLISHING A BRANCH OFFICE
A branch office is subject to taxation for any income from sources within Japan in the same manner as with any local Japanese corporation. In general, transfer of operational funds between the branch and its head office can be made without restrictions, and is not subject to withholding tax.

ESTABLISHING A JAPANESE CORPORATION
The following types of company formations available

• Kabushiki Kaisha (K.K.)
• Godo Kaisha
• Limited Liability Partnership (LLP)

Effective May'06 the Company formation regulation has changed!

Please note In May'06 the Company Law has been changed and now the local corporation K.K. Company can be established with any amount of minimum capital amount (from 1 Yen) as the requirement of minimum capital of ¥ 10M has been abolished. 
Although there are various types of local companies which can be established however majority of foreigners and foreign corporations opt to establish either K.K. Company or a Branch (especially after the change in rules & regulation since May'06). At the same time incorporation of YK Co had been abolished.