tip 1
About the method that a foreigner establishes the company in
Japan.

• ☆Regulatory reform makes it easy to establish a company.
  As the residence status of “Investor/Manager ”（投資・経営：とうし・けいえい） is
  replaced by the residence status of “Manager/Administrator ”（経営・管理：けいえい・かん
  り） from April 1, 2015, requirements of acquisition of the new residence status is also
  relaxed. (*1 )
  1. A foreigner can apply for the residence status of "Manager/Administrator " (residence period four months) before the company establishment.
  2. A foreigner does not have to prepare for the investment of 5 million yen alone.
  <*1 > In Japan, the foreigner acquiring the residence status such as “Permanent Resident
  "（永住：えいじゅう）, “Spause or Child of Japanese National "（日本人の配偶者等：にほん
  じんのはいぐうしゃとう）, "Spause or Child of Permanent Resident "（永住者の配偶者等：え
  いじゅうしゃのはいぐうしゃとう）, "Long-term Resident "（定住者：ていじゅうしゃ） does
  not have working restrictions.
  
  
• ☆Procedures to establish a company in Japan.
  1. Firstly, when a foreigner establishes a company in Japan, it is necessary to acquire
  aresidence status of "Manager/Administrator "（経営・管理：けいえい・かんり）.
  An applicant or an agent makes articles of incorporation of the company and get it
  authenticated as official at a notary public office. Then, he/she attaches the articles of
  incorporation and performs the application procedure of the residence status of
  "Manager/Administrator "（経営・管理：けいえい・かんり）with the period of four months
  and acquire the residence status. (*2 )
  <*2 > The Immigration Bureau examines whether there are stability and continuity of the
  business, and whether there is the actual situation of the business activity in Japan.
  
  2. Secondly, the foreigner acquires a residence card by a residence status of
  "Manager/Administrator " （経営・管理：けいえい・かんり）and shows this and open
  a personal bank account.(*3 )
  <*3 > In the residence periods less than three months, he/she cannot open a bank
  account in Japan.
  
  3. Thirdly, at the same time that the foreigner reports the place of residence to the
  office of the nearest city and district municipalities, he/she may as well prepare
  the seal impression beforehand and register it on this occasion.
  Documents with regard to the registration of incorporation of the company like a
  document certifying that the director of the company has accepted the assumption of
  office have to attach the seal impression and a seal certificate.
  
  4.Fourthly, the foreigner decides the principal office to register with regard to the
  registration of the company. Because it is not easy for a foreigner to conclude a real
  estate contract, he/she is able to perform the registration of incorporation of the company
  by using a rental office or a virtual office temporarily. In this case it is desirable to
  change the registration of incorporation when he/she was able to obtain an appropriate
  office.
  
  5. Fifthly, when the foreigner starts the business in Japan it is essential to confirm before
  the registration of incorporation of the company whether the authorization by the
  Japanese administration (the police, public health center, the metropolis and districts)
  is necessary or whether the organization system conforms to the requirements
  providedbylaws and regulations by industry group. (*4 )
  <*4 > In the case of the production dealership of pharmaceutical products, it is necessary
  to maintain the placement of the persons in charge of both the quality management and
  the vigilance management and to administer the organization for this purpose.
  
  6. Sixthly, the foreigner pays the capitalto the bank account and prepares for the
  balance certificate (a copy of the bank book). (*5 )
  A foreigner attaches the required documents mentioned above and performs the
  application procedures of the registration of incorporation of the company in the
  local Legal Affairs Bureau.
  At the same time he/she registers the seal impression of the company. (*6)
  <*5> The foreigner does not have to prepare for the investment of 5 million yen now.
  <*6> Upon the arrival of an Application at the offices of an administrative agency, the
  agency shall commence its review of the Application without delay.
  And unless an Application conforms to requirements that the entries of the written
  application be completed, that the written application be attached by necessary
  documents, that the Application be filed within a specified period of time, or to other pro
  forma requirements provided by laws and regulations, the agency shall promptly either
  request the persons who filed the Application toamend the Application, specifying
  considerable period of time to make such amendment, or refuse the permission, etc.
  sought by the Application.
  
  7. Seventhly , after procedure completion (approximately two weeks later), the foreigner
  acquires a certificate of all the registered matters of the company and the
  certificate of seal impression of the company and opens an account in the
  name of company in a bank.
  Furthermore, he/she goes to each public administration office (a tax office, a Labor
  Standards Inspection Office, a Hello Work (a Public Employment Security Office) and
  a pension office) having jurisdiction over the address of the company and performs a
  report of the company establishment and other necessary business formalities.
  A series of procedures of the establishment of the company is finished in this way.
  
• 
  
• ☆Three kinds of organizations called a subsidiary company, an overseas
  office or a representative office
  
• 1. When a foreign company (corporation established abroad) goes into Japan and is going
  to perform business activities there, according to Foreign Exchange and Foreign
  TradeControl Act,the commercial law or the company law, they can consider
  three kinds of organizations called a subsidiary company, an overseas office or
  a representative office to carry out investment in Japan.
  
• 2. When a foreign company (corporation established abroad) performs business activities
  with either three kinds of base forms mentioned above in Japan, it is necessary to
  investigate beforehand whether the prior or subsequent report based on each
  businesslaws andregulations is need.
  When the foreign company needs to perform a prior report to the Bank of Japan,
  it cannot establish a subsidiary company or an overseas office after a report for at least
  two weeks.
  Therefore, especially, in the case of a subsidiary company or an overseas office, it is
  essential to confirm through the Bank of Japan whether the prior report to the
  Minister ofFinance and a Minister having jurisdiction over the business
  concerned is needed according to Foreign Exchange and Foreign Trade Control Act.
  
• 3.There is a concept to be used in international tax practice called the “PE“ (permanent establishment)(*7).
  The "PE", which is the abbreviation of the word "permanent establishment", points to the
  constant "place", "facilities", "function" or "bases" that is used when each three kinds of
  organization performs business activity in Japan.
  Regarding the income of the business of an organization, if the organization does not own
  the "PE" in Japan , neither the income tax collected at the source nor the corporation tax
  is levied at all. This is also a world common rule of taxation.
  Therefore, a subsidiary company and an overseas office perform profit-making activity,
  because they are defined as the organization which owns “PE”. On the other hand, a
  representative office cannot perform profit-making activity because it is defined as the one
  which does not own “PE”.
  <*7> A permanent establishment (PE) is a fixed place of business which generally gives
  rise to income or value added tax liability in a particular jurisdiction. The term is defined in
  many income tax treaties and most European Union Value Added Tax systems. The tax
  systems in some civil law countries impose income and value added taxes only where an
  enterprise maintains a PE in the country. Definitions of PE under tax law or tax treaty may
  contain specific inclusions or exclusions.(from the free dictionary)
  
• 4. The activities of the representative office are restrictive. Then the requirements on
  establishing the representative office are relatively simple. (*8)
  However the requirements on establishing a subsidiary company or an overseas office are
  complicated and similar to a normal process of establishing the company except Company
  name and Capital. With regard to the registration of incorporation of the company
  thepreparationof the affidavit(*9) is essential.
  <*8> Because the representative office does not own PE, it cannot make profit in
  business. The contents of activity which are permitted are as follows. They are the
  reporting to the company of the own country, advertising, a marketing research, a basic
  investigation and the asset purchase and safekeeping.
  <*9> An affidavit is voluntarily made without any cross-examination of the affiant and,
  therefore, is not the same as a deposition, a record of an examination of a witness or a
  party made either voluntarily or pursuant to a subpoena, as if the party were testifying in
  court under cross-examination.(from the free dictionary)　
  
• 5. When a foreign company (corporation established abroad) receives a certification of
  articles of incorporation at a notary public office of Japan for the purpose of establishing a
  subsidiary company or an overseas office, the company has to prepare for the document
  regarding establishing the company (like a certificate of the establishment of the
  company, a certificate of all the registered matters of the company or
  a business license), and the affidavit about the company profile which is issued in the
  government office (a notary public office) of the own country and the certificate of the
  signature of the companyrepresentative.
  (When the parent company in Japan establishes a subsidiary, the company has to prepare
  for a certificate of registered matters of the company and its seal certificate.)
  
  
• 6. The summaries of the difference in the operation in Japan of three base forms of a
  subsidiary company, an overseas office and the representative office are as follows.(*10)
  
  <*10> The summaries of the difference in the operation in Japan of three base forms of a
  subsidiary company, an overseas office and the representative office
  
  

  	Subsidiary company	Overseas Office	representative office
  Registration of Incorporastion of Company	Necessary	Necessary	Unnecessary
  Company Name	Unlimited (*11)	Parent company 's name	Unlimited (*11)
  Election of Representative	Necessary (One or more Representative directors live in Japan )	Necessary (One or more employees live in Japan )	Necessary (One or more employees live in Japan )
  Residence Status of Representative	Manager/ Administrator	Intra-enterprise transferee (Manager/ Administrator)	Intra-enterprise transferee
  Capital	Necessary (More than 1 yen )	Unnecessary	Unnecessary
  Bank Account	Company name	Company name	Representative's personal name
  Incorporation procedures	The same as a normal company	Relaxed	Not performed basically
  Making Profit in Business	Possible	Possible	Impossible (*8)
  Account Processing	The same as a normal company	Depends on the parent company	-
  Remittance to the own country	Possible	Possible	-
  Lawsuit (or Debt and Credit)	Not retroactive to the parent company of the own country as a general rule	Retroactive to the parent company of the own country	-
  Social insurance participation	The same as a normal company	The same as a normal company	Depends

• <*11> Registration of the Identical Trade Name at the same location is prohibited.