Stock Company Incorporation

1.Stock Company Incorporation Overview

The Stock Company is one type of corporate entity which can be incorporated under the Companies Act of Japan.

Through the incorporation of a Stock Company, the investors (either individuals or corporations) become shareholders of the new company and each shareholder assumes limited liability up to the amount which they have invested.

Shareholders acquire the right to vote at company shareholder meetings and receive dividends from company earnings.

A Stock Company differs from the branch of a foreign company in that it is a completely independent entity and all credits and liabilities belong directly to the company.

The Stock Company has a much longer history than Godo Kaishas and other forms of corporate entities and therefore is by far the most common and well-known type of business entity in Japan.

2.Stock Company Incorporation Procedures

When incorporating a Stock Company, basic company details such as the Trade Name, Head Office Location, Business Purposes, Company Officers, Capital and other matters must first be decided. When deciding on these details, numerous factors must be considered including the fact that at least one of the Representative Directors of the company is a person with a registered address in Japan.

The process of incorporation can be broadly separated into (i) drafting of the Articles of Incorporation, (ii) notarization of the Articles of Incorporation, (iii) investment of paid-in capital and (iv) incorporation registration.

In addition the incorporation procedures require the creation of numerous other documents all of which must be written in Japanese.

The following chart briefly summarizes the steps required to incorporate a Stock Company.

Please expect the process to take approximately one to two months from commencement to the completion of registration.

1. Decide on details of Stock Company
The investor (promoter) decides on the basic matters of the company such as the Trade Name, Head Office Location, Business Purpose, Officers, and Capital.
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2. Drafting the Articles of Incorporation
After the details of the company have been decided, Articles of Incorporation which specify the Trade Name, Head Office Location, Business Purpose and other rules of the company must be created.
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3. Notarization of the Articles of Incorporation
In the case of a Stock Company, the Articles of Incorporation of the company need to be notarized by a Notary Public in Japan. This is one major difference from a Godo Kaisha.
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4. Payment of capital contribution
Once the Articles of Incorporation have been notarized, the investor (promoter) must deposit the capital amount into a bank account with a financial institution in Japan registered under the name of the promoter or the Representative Director.
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5. Incorporation registration of Stock Company
Register the Trade Name, Head Office Location, Business Purpose, Officers, Capital and other matters with the Legal Affairs Bureau.
Please click here for a list of documents needed for registration.
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6. Commence business activities
Business activities may be commenced from the date of registration. Once the registration has been completed, company bank accounts may be opened and various notifications to the tax and social insurance authorities may be submitted.

3.Necessary Documents

Generally speaking, the following documents are required for Stock Company incorporation.

All documents must be created in Japanese and English versions are only considered as reference translations.

1. Articles of Incorporation

This document sets forth the basic rules with respect to the company to be incorporated.
The Articles of Incorporation must be notarized by a Notary Public in Japan.

2. Registered seal certificate of the promoter (or Signature Certificate)

As part of the process for the notarization of the Articles of Incorporation, the registered seal certificate of the promoter must be submitted to the Notary Public. For foreign nationals who have not registered a personal seal with their local government office, a Signature Certificate may be used as an alternative. The Signature Certificate must be notarized by a Notary Public or consular office. We can provide a Signature Certificate template as a part of our services.

3. Proof of Paid-In Capital

This refers to documentation that demonstrates that the capital amount has been paid-in. A copy of the bankbook of the account to which the capital was paid to is submitted as part of the incorporation registration for this purpose.

4. Acceptance of Office Letters from each Officer

All officers at the time of incorporation of the company must provide an Acceptance of Office letter with a seal attached. In the case of foreign company officers who do not have a seal, a signature is accepted as an alternative.

5. Registered Seal Certificate of Officers (Signature Certificate)

The registered personal seal certificate of each Director is required. For foreign nationals who have not registered a personal seal with their local government office, a Signature Certificate may be used as an alternative. The Signature Certificate must be notarized by a Notary Public or consular office. We can provide a Signature Certificate template as a part of our services.

6. Company Seal

In Japan it is customary to use seals rather than a signature on official documents. Therefore, an imprint of the seal of the Representative Director will need to be registered with the Legal Affairs Bureau of Japan. To do this, a branch seal is required. We can order the necessary seals for our clients. The cost of seals can vary considerably depending on the material used to make the seal.

For cases when the promoter is a corporation

Certificate of Registered Matters (or Affidavit) of the Promoter (corporation)

When the promoter is a corporation, at the time of notarization of the Articles of Incorporation, a Certificate of Registered Matters (of the promoter) must be submitted to the Notary Public.

In the case of foreign (non-domestic) corporations where a Certificate of Registered Matters is not obtainable, an Affidavit containing the necessary details is prepared and notarized by a Notary Public or consular office. As part of our incorporation service, we will draft the required Affidavit; however, we will require copies of the Articles of Incorporation of the foreign company and other documents which form the basis of the Affidavit.

The Affidavit will need to be signed by an officer of the foreign company.

First time consultation is free either in person or by telephone appointment. Consultation provided in English.