setting up a company or local branch

Preparation

The following preparations should be completed before commencing set-up procedures:

I. Survey of objectives

Companies in Japan are only allowed to carry out business activities written in the "objectives" section of the articles of incorporation, so it is vital to thoroughly research the feasibility of all your companies "objectives" or business activities before setting up. Under the New Corporate Law, it becomes possible to use more inclusive wording to describe business purpose.

II. Trade name search

It is possible to register a company under a certain name, unless the same name in the same address does not exist.

III. Permits

Some business activities require the company to obtain special permission from - or submit notification to-relevant government or municipal offices once the business has been established and trading commenced. It is recommended that you check before you set up whether or not your company will need any such permits or to provide such notification. (Ex. Investment advisor of securities and real estate, secondhand dealer etc)

IV. Reports and notification under the Foreign Exchange and Foreign Trade Control Law

Companies are generally required to report to the Bank of Japan within fifteen days of setting up a branch in Japan (advance notification is allowed). Relevant details are available from the BoJ, but many companies choose to consult with a professional in the field.

V. Personal name seal

People who assume important posts within the company will need to have personal name seals made and registered with the local government office with jurisdiction over the locations where those people reside (this registered personal name seal is known as a jitsuin ). These are used in Japan as the same manner as signatures in other countries, i.e., as a form of identification. It is necessary to have a jitsuin made and registered prior to registering the company; jitsuin can be made at a seal store for as little as ¥20,000. Do not forget that over the course of the company establishment process you will need several copies of the certificate of registration of your jitsuin from your local government office. Remember also that the alien registration process must also be completed in order to register a name seal; where alien registration is not completed, a certificate of signature authentication issued by a notary public from the home country of the person registering the name seal will suffice,though this procedure takes time. After all, it is recommended to complete the alien registration in advance.

VI. Company seals

Once your company name is decided upon, it is time to make company seals. This usually means a set of three seals: a representative seal (known as daihyoin , it is effectively a jitsuin for the company) , an everyday use seal ( shiyoin ) and a company name seal ( shaban ); these can be made at a seal shop for as little as ¥20,000. The Daihyoin is the seal registered with the company registry office by the company's representative; it can be used as the representative's personal seal (in his or her capacity as representative), but in most cases, the representative uses separate seals for personal and company business. The shiyoin is used mainly in the company's dealing with banks, while the shaban is a square stamp used when issuing receipts, invoices and the like (it is usually affixed so that it slightly overlaps with the company name printed on the paper).

VII. Deciding on a bank for capital

When setting up a company, the company's capital is generally paid to a bank. The company must have balance inquiry issued by bank, which is then submitted to the registry when registering the company. Balance inquiry can be gotten easier than capital custody certificate which was required previously.