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As part of Prime Minister Shinzo Abe’s comprehensive economic policy package known as Abenomics, Japan has set a target for annual foreign direct investment (FDI) of ¥35 trillion by 2020. To reach this goal, the country must make itself not only a more desirable market but also an easier place for non-Japanese to conduct business.
Attracting startups is a key part of the plan, and in April 2015 steps were taken to make setting up a business easier.
Previously, those living abroad who wanted to come to Japan and start a company faced a Catch-22. To obtain a visa, one first had to register a company here. But to register a company, one needed to obtain a business manager visa and take up residence.
To solve this conundrum, a startup visa program was made available to those wishing to set up shop in the Tokyo and Fukuoka National Strategic Special Zones. This visa gave entrepreneurs six months to establish their business and could be renewed if one of two conditions were met: ¥5 million was invested in the company or two full-time employees were hired.
DOUBLE TIME
While a step forward, six months passes quickly and, according to Nikkei Asian Review only 30 such visas were issued in 2016 and 2017 combined. To better compete with other nations, a more flexible approach was needed.
As part of new economic package passed by the Diet on December 8, the startup visa period will be extended to one year and made available nationwide under a pilot program led by the Ministry of Justice and the Ministry of Economy, Trade and Industry (METI).
The American Chamber of Commerce in Japan (ACCJ) applauds the efforts of the government of Japan (GOJ) to make the country a more attractive place for those from abroad to start new businesses. The steps being taken to extend the term of the startup visa will significantly increase the ability of global entrepreneurs to grow their businesses in the Japanese market. This, in turn, will lead to an environment that supports increased economic growth.
“We know that innovative small and medium-sized enterprises—including startups—have the potential to infuse energy and innovative solutions into the economy,” said ACCJ Venture Company Task Force (VCTF) co-chair Barry Hirschfeld. “We are pleased to see positive moves being made by the GOJ to make Japan more vibrant and internationally competitive.”
VCTF vice-chair Jim Weisser added: “By implementing measures to amend the startup visa, foreign entrepreneurs with the skills and experience to lead innovative businesses that address key business needs—as well as critical social needs—will be more willing to consider Japan.”
HELPING HAND
Efforts by METI to support local governments in attracting global startups are also welcome.
To help facilitate the process of establishing startups in Japan, METI will work together with localities wishing to attract FDI to identify professionals such as lawyers, accountants, and real estate agents who can provide services in English and other languages. By using these METI-certified professionals, entrepreneurs can gain access to private funds and government-affiliated lenders—something that will make a big difference for those trying to navigate a system that has long been difficult to crack from the outside.
Custom Media publishes The ACCJ Journal for the American Chamber of Commerce in Japan.
- External Link
- https://journal.accj.or.jp/easier-startup/
15 Comments
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Yubaru
For the life of me I have a difficult time understanding why any foreign entity would actually want to attempt a start-up here? Bringing an established business is one thing, but an individual on their own, is going to have a very difficult time here.
fxgai
For individuals you also would be subjecting yourself and family to Japan’s insane inheritance and gift taxes.
Japan is currently one of the worst places in the world to be wildly successful, on that count.
The time your come do business in Japan will be after a big reset.
Cricky
Good lord, more hoops to negotiate its hard enough now to start a new idea, these Shinzo arrows just nail people to the ground. Start a company costs money, staff costs money and the idea is lost under a heap of replicating paper work. The only smart business is starting a school and being a close confident of the regime.
Dango bong
immigrants NO (unless you have cash)
PerformingMonkey
Only let them in if they know how to use a FAX machine.
wanderlust
It's relatively easy to start up a business, but the hard part is running it. The banks in particular make it hard to establish simple financial arrangements such as credit cards and payment facilities (stone-age mentaility) and overseas financial transactions are time-consuming and expensive (along with the ever present paranoia on money-laundering); import, storage and export of goods is fraught with paperwork, whilst buying/ renting offices and facilities is expensive in central business districts, and subject to the discrimination of landlords.
Improve these aspects, and the taxation programmes outlined by @fxgai, and you may stand a chance of attracting new business.
Matt Hartwell
Could a service like Transferwise aid with that problem?
roughneck
This information looks like a myth, as it is no where in the immigration website.
mmwkdw
Did it stipulate "Native Japanese" speaking employees only ? (as this is the current trend on JD's these days).
GW
I predict another 30 or so takers over the next couple years if that!
Japan is just more hassle than it is worth for most people/businesses sadly...
Ex_Res
Good idea, but 30 years too late.
kurisupisu
What a great initiative!
The adult diaper business is the one I want to target....
Chariot
The whole idea looks a ill-targeted. You don't target startups for FDI goal , rather you target big businesses!
Japan needs to do much more if it needs to improve WB ranking of "starting a business" from current rank 106.
paradoxbox
This visa system has been in place for a long time.
Not many people knew about it (And even now it's not well known) but if you actually do manage to make a business that has enough sales revenue, you can get a visa for it.
IMO this is the best option for anybody from any country, especially poor countries, to get their foot in the door in Japan.
Remember not everyone is here to boost their career or make buckets of cash, some people have a loved one or some other reason to be in Japan but can't obtain a spouse visa.
50million yen sounds like a lot of money until you actually start running a business, then you realize it's a ridiculously low amount. You're talking less than $40,000 a month in sales, or approximately $1200 a day -in sales revenue-. This is not a very difficult target for most businesses with someone smart behind the helm. The profits can be nearly zero but it will still clear immigration's threshold.
I suspect if more asylum seekers knew about this system they'd use it instead of wasting money on brokers and rotting in the immigration jails waiting for work permits. A good bunch of asylum seekers clogging the system now are really just business owners who don't know that there's a far better way to get into Japan.
kurisupisu
@paradoxbox
But what is the point of running a business just to satisfy the business visa's conditions if there isn't any profit in it?
With so many extraneous costs here it isn't really worth it.....