Past iadvisory Questions and Answers: Japan

Over the years, our members have benefitted from having their overseas expansion related questions answered by our iadvisors. Visit the iadvisory portal for some of these examples on Japan.

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1. What is the best way to setup a company in Japan?

Types of entities provided under the Japanese company law are, Limited Company by share (Kabushiki-Gaisya), Limited Liability Company (LLC) and Unlimited Company.

Generally foreign investors choose Limited Company by share (Kabushiki-Gaisya) as it is the most trusted form and also forms the majority in Japan. Should you choose a LLC, the shareholder should act as the director.

2. What are the pros and cons of a joint venture (JV) with a local Japanese partner?

Pros: The process of establishing a joint venture agreement is simple and no registration is required for a joint venture.

Cons: You cannot open a bank account under the title of a JV or register a JV to the Japanese Government except for LLP. I do not recommend using JV as a resource of penetrating the Japanese market.

3. What are major points to address in a joint venture contract?

The most important thing is how you intend to divide your profit with your JV partner and your profit share from the joint venture. You should also pay attention to the term of the contract, the contents of management, the contract of termination, the legal jurisdiction and the court jurisdiction.

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