Japan plays a major role in the global economy, and many economists predict that the country will continue to be an important market. Having a business setup in Japan can provide emerging multinational enterprises an important foothold, not just within the country, but also in the much wider Asia-Pacific market.
However, there are many challenges that companies have to face when starting a business in Japan. For instance, depending on the business and scope of operations, an organization may choose to set up a Subsidiary Company, Branch Office, Representative Office, or Representative Service, among other business types. Each has its own advantages, and understanding the prerequisites of setting up, and the limitations of each type can make it easier for business owners to navigate Japan's business environment.
Subsidiary or Stock Company (Kabushiki Kaisha). Similar to a Joint Stock Company in the US, many large-scale corporations choose to establish a Kabushiki Kaisha (KK) because there are more options for gathering investment. A KK also has a very low minimum share capital requirement, and there are few restrictions on its business activities.
Branch Office. Establishing a branch office can be a good option for established foreign corporations. There are no significant differences between the rules and restrictions for companies and branches.
Representative Office. Companies that are still in the early stages of establishing a business in Japan can choose to create a representative office. Although there are a number of restrictions, this business model will allow a company to advertise, conduct market research, and purchase and store assets. This can pave the way for when the company is ready to fully establish their business operations in Japan.
Representative Service. Hiring a Representative Service for specific business activities can provide foreign companies an effective presence in Japan prior to setting up a branch or subsidiary. This can help a foreign-based company establish contacts and build confidence in the brand among local businesses until the organization is ready to fully commit to the market.
The Tokyo Consulting Group (TCG) provides a wide range of services to help companies establish a presence in Japan, and efficiently maintain business operations. To learn more about the company and its services, visit Kuno-CPA.co.jp, or call +81-3-5369-2930.
