Since 2006, much easier to make Kabushiki-kaisha (corporation) in Japan

Since 2006, it has become much easier to make a Kabushiki-kaisha (business corporation) in Japan.

There are 4 reasons:

  1. Capital required – only need 1 yen to establish a corporation in Japan (used to be 10 million yen). The more capital invested in the company, the higher the tax bracket. So by reducing the capital required, the tax payable has also been reduced, making it easier for businesses to start up. Of course, it is still recommended to have a certain amount of capital, to gain reliability with the banks and investors.
  2. Board of Directors – only 1 person required (used to be 3 people plus auditor). Also under certain conditions, it is not required to have board meetings anymore.
  3. Documentation from the bank – previously it was required to show a document, signed by the bank, that you had opened a bank account for your business and had deposited the capital. But banks didn’t really like doing this! So now it is not necessary to get the bank’s signature anymore, making the whole process much easier. Instead, you can now submit a copy of the document (without the bank’s signature), with a copy of your company’s bank account book showing the amount of capital deposited.
  4. Trademark – previously it was not allowed to use a similar trademark or name to another company in the same region (same town, same village). Now it is possible to have the same/similar name to another company even if you are in the same town/area.

Source: “The easiest way to establish and run a company in Japan” by Satoshi Murakata, 8th Edition, published 30th March 2012.

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