Start-up of a Stock Company, Kabushiki-Kaisha「株式会社」in Japan
We hereby describe the summary of the process, requirements, cost and fees for establishing a stock company, Kabushiki-Kaisha「株式会社」 in Japan.
I. Steps of Foundation
The corporation law of Japan defines two methods of founding a stock company, "Promotive Foundation「発起設立」" and "Subscriptive Foundation「募集設立」".
"Subscriptive Foundation" is so complicated that it seems to be difficult for foreign investors to found a stock company in the method of "Subscriptive Foundation" in Japan.
We would like to describe just the method of "Promotive Foundation".
The following show the process of founding a stock company in the method of "Promotive Foundation":
First Step. To create a bylaw and authenticated by a notary public
Second Step. To determine allocation of stocks & amount to be paid in capital & others
Third Step. To assign directors, auditors & others
Fourth Step. To pay the "paid in capital" determined in the second step
Five Step. To register the company
II. Creating a Bylaw
It is starting with creating a bylaw to found a stock company, which shall regulate the organization, control manners, procedures of the stock company.
It is able to draft a bylaw freely, while the corporation law of Japan defines the minimum requirements for a bylaw of a stock company as follows:
B. name of the stock company
C. place of head office
D. amount of minimum amount to be "paid in capital" at the foundation
E. name and address of (a) promoter(s)
A bylaw of a stock company should be created by unanimous consents of "Promoters「発起人」".
Each promoter of a stock company is also required to be a shareholder of the stock company on the foundation of the stock company.
Not only an individual but also an institution or a company can be a promoter of a stock company, while any promoter is not required to be a citizen of Japan or a company or an institution established under the corporation law or other laws of Japan.
It is also not required for any promoter to be an individual who resides in Japan, or a company/an institution which has been registered on the corporate ledgers in Japan.
Last but not least, a bylaw of a stock company is required authenticated by a notary public before the foundation.
III. Assignment of Management
The corporation law of Japan admits that an organization of a stock company can be constructed relatively freely.
A. Every stock company needs to have at least one "Director「取締役」".
B. A stock company can have other titles and roles of executives, such as "Auditor「監査役」", "Accounting Advisor「会計参与」", "Accounting Auditor「会計監査人」".
A director or an auditor of a stock company should be an individual, while it is not required to be a citizen of Japan or to reside in Japan.
In order to have a title of executives other than "Director", it is necessary to define in the bylaw.
Directors and others defined in the bylaw should be assigned before the foundation.
Each name of directors and other executives should be registered on the corporate ledger.
Each director principally represent the stock company.
In order to hold a "Board of Directors「取締役会」" as a fixed organization of a stock company, it is necessary for the stock company to have at least three directors, and a board of directors is required to appoint one or more "Representative Director(s)「代表取締役」.
Each name and address of the representative directors should be registered on the corporate ledger, although a representative director is not required to reside in Japan or to have citizenship of Japan.
IV. Payment of "to be Paid in Capital"
It is required that the minimum amount to be "paid in capital" defined in the bylaw should have been fully paid before the foundation of the stock company.
If nonmonetary assets are defined to be contributed in the bylaw, those assets are required to be actually contributed before the foundation.
Before the foundation, it is required by unanimous consents of promoters to determine how many shares each should subscribe and how much money each promoter should pay.
Each payment by a promoter should be made by money remittance to a designated bank deposit account.
When nonmonetary assets are contributed, it is principally necessary to have the competent court evaluate the value of the assets.
V. To be Determined before the Foundation
A. name of company
Not only Japanese letters but also alphabets are currently allowed to present the company name.
A Japanese term「株式会社」is to be included.
B. place of head office
The actual contents of the business of the company are not fixed in details.
Potential future business can be included.
It is necessary to determine the following:
a) titles of executives other than "Director" to constitute the company
b) fixed number of each title, if necessary
c) who takes the titles, with consents from the assignees
d) who should be representative directors, with consents from them
E. restriction on transfer of shares
It is common in Japan for stock companies with small group of shareholders, like family owned companies, that shares cannot be transferred without consents by the company in accordance with the bylaw.
If a company have a bylaw with a restriction of transfer of any of its shares, the company is called as " Non-Public Company"(「公開会社でない会社」).
There are different regulations between "Non-Public Company" and "Public Company"(「公開会社」) such as the following:
a) A public company is required to have an auditor when it has a board of directors, while a non public company is not required to have an auditor even if it has a board of directors or an accounting advisor.
b) A non public company can make a rule that any director should be a shareholder of the company.
c) A non public company can prolong tenures of directors or auditors up to ten years.
d) A public company is required to issue shares of more than or equal to the quarter of "Total Number of Authorized Shares", while a non public company is not required so.
F. total number of authorized shares
It is necessary to define "Total Number of Authorized Shares" in the bylaw of the company and it is also required to register the number in the corporate ledger.
G. fiscal year/business year
The term and the ending month of the fiscal/business year are usually defined in the bylaw, while they cannot be registered in the corporate ledger.
H. source of public notice
Stock companies in Japan are required to make public notices about regulated financial data and regulated transaction like mergers or capital reduction via sources selected from "official gazette", "daily paper" or "electrical notice method".
I. If certificates of shares should be issued or not
Currently non issuance is a standard and issuance is an exception to be defined in the bylaw.
Promoters or a promoter should be fixed before the foundation, while there is no restriction on individual or institution, Japanese or non Japanese and resident or non resident.
K. allocation of shares issued to each promoter and payment or contribution by each promoter
L. determination of capital money
"Paid in Capital" should be divided into "Capital Money"「資本金」and "Additional Paid in Capital"「資本準備金」.
"Capital Money" should excess or be equal to "Additional Paid in Capital" and should be registered.
VI. Other Remarks
A. bank deposit account
Payment from a promoter of a stock company should be transferred into the designated bank deposit account.
It is usual that a personal bank account of a promoter shall be designated as the account to be transferred into.
This means that at least one of the promoters needs to have a bank deposit account in Japan.
It is possible to designate a bank deposit account in a branch or an office in Japan of a non-Japanese bank, although it is impossible to designate a bank deposit account in a foreign branch of a Japanese bank.
If none of the promoters lives in Japan and has any bank deposit account in Japan, a bank deposit account of a third party can be the designated account to be transferred in on a condition that the third party has been given a power of attorney from one of the promoters.
B. seal or signature on the bylaw
When a promoter or promoters of a stock company obtain authentication of the bylaw from a notary public, all of the promoters are principally submit their "certificates of seal impressions"「印鑑証明書」.
Also, when a registration of a stock company is applied, all of representative directors are required to submit their "certificates of seal impressions".
A non- Japanese resident can file its seal impression to the competent governmental office, then ask the governmental office to issue a certificate of a seal impression.
If a representative director is not able to submit a certificate of a seal impression, a certificate of signature shall be acceptable instead.
While a Japanese, non-resident is not qualified to be issued its certificate of a seal impression, a representative of a Japanese, non-resident can submit a certificate of signature issued by an embassy or a consulate for registration of the foundation.
A non-Japanese, non-resident can submit a certificate of signature issued by an authority of its own country or a certificate of signature notarized by a notary public.
C. stamp & seal of the Company
Commercial Registration Law of Japan(「商業登記法」) requires every applier for registration to submit a seal impression(「印鑑」) to the competent registration office.
Foundation of a stock company should be finalized by registration.
It is necessary to submit the seal impression to the competent registration office at the same time as applying for registration on foundation.
VII. Costs of Founding a Stock Company
Charge for Authentication of a Bylaw by a Notary Public
:30,000. JPY *1
Revenue Stamp of a Bylaw *2
Revenue Stamp for Registration *3
Fee to Us *4
Total Estimated Costs *5
*1 Charge for Authentication of a Bylaw shall be different in accordance with the Capital Money.
If the Capital Money is less than one million yen, : 30,000. JPY
If the Capital Money is equal to or more than one million yen and less than three million yen,
: 40,000. JPY
If the Capital Money is equal to or more than three million yen,: 50,000. JPY
*2 Revenue Stamp of a Bylaw can be avoided by "Electronic Application Method「電子認証申請」"
*3 Revenue Stamp for Registration should be calculated in accordance with "Capital Money「資本金」".
Both of the amount showed above are the minimum charges.
*4 This fee shall be changed, if none of the directors lives in Japan.
*5 If we have paid additional expenses such as charges of some certificates or postal charges, those expenses shall be added.
We can support you to found a company registered at any legal bureau in Japan without asking you for transportation expenses to the legal bureau principally, as our allied judicial lawyer or shihoshoshi lawyer can provide online registration services.
If you are not a resident in Japan and willing to found a company in Japan without any executive or any director residing in Japan, we shall ask administrative fees annually.
VIII. How to Contact Us.
If you are willing to start-up a stock company or "kabushiki-kaisha" in Japan or have any question, please feel free to send your request or inquiry via "contact us" page.
You can also contact us via instant messaging service, WhatsApp or Telegram.
@ +81 90 6188 1648
Otherwise, please contact us by phone or by email !
Mobile : 090-6188-1648
Email : email@example.com
Chuo-Ku District, Tokyo , Japan
Postal Code: 〒103-0012
TEL : 090-6188-1648