executive impact

Shinonome Group

By Chris Betros

Incorporating a company in Japan can be a daunting challenge for foreign companies or entrepreneurs. Companies like Shinonome Group can save new entrants to the Japanese market a lot of hassle.

Founded in 1975, Shinonome Group provides counsel on a range of matters including business and commercial, immigration and visa, real estate, and estate planning and administration issues in Japan.

Heading the company is Hiroki Hoshino, whose father founded the predecessor to Shinonome Group. Born in 1975, Hiroki graduated from Waseda University in 2000 with a politics and economics major in 2000. He passed a national qualification test for administrative procedures and judicial scrivener in 2003. He joined the firm in 2005.

Japan Today editor Chris Betros visits Hoshino at the group’s head office in Tokyo.

What are your main lines of business?

We are a legal consulting group. Our core business is in the field of procedural and legal documentation for company incorporation. Our group also includes a law firm that handles corporate and personal litigation and a consulting firm that provides among other things management consulting and real estate services.

To give you one example of what we do, the law on public interest corporations (“shadan hojin”) changed recently and because of that, all existing “shadan hojin” must convert to a new type of entity to comply with the new laws. This involves more than just simply submitting paperwork. There is a considerable amount of management-level consulting work that also needs to be done. As a group, we provide those services.

In addition to consulting, we perform the actual registration and submitting of applications for business permits. We also provide real estate consulting to help clients find office space. Another important service is to handle visa procedures for clients who bring in employees from overseas.

What sort of clients do you have?

A whole range, from domestic listed companies to one-person operations. We have about 40 foreign clients for which we provide incorporation and visa support services. We also handle inheritance and debt restructuring matters for individual clients.

How do you market your group’s services?

For marketing to foreign clients, the Internet is our main marketing tool. We have an English and Chinese website. Because of the nature of what we do, we have a lot of alliances with tax specialists and other professional firms. In many cases, those firms approach us because they have clients who need a certain type of legal service which they cannot provide. Word of mouth is also very important to us and we have many repeat clients.

What are the biggest difficulties that foreign businesses face when they come to Japan?

Company incorporation and visa application procedures in Japan can be complicated and extremely time consuming for those not accustomed to Japanese laws, practices and cultural differences.

We have found that often in the case of subsidiaries and branches, the people who come to Japan really don’t know what they are getting into. They are quite often sent by someone at HQ, simply having been instructed to come to Japan and set up a Japan office. They have no network and don’t have a good feel for the local rules and customs. Part of our role is to provide that support.

How hard is it to incorporate a company in Japan?

There have been many revisions to the Companies Act which have made it easier to incorporate a company than it used to be. For example, in the past, to incorporate a stock company, you had to have a minimum capital investment of 10 million yen or for a limited company, 3 million yen. With the changes to the law, the minimum capital requirement for incorporation is now one yen.

How will the change to the Moratorium Act affect business?

The Moratorium Act (a moratorium on loan repayments by small businesses) is set to expire next year. The act was passed to allow small businesses to defer debt repayments and as result of being phased out, it is expected that some businesses will fail due to an inability to make loan repayments. This means that there will likely be an increase in mergers and acquisitions as companies are forced to restructure.

Tell us about your team.

We have approximately 50 staff in total. That includes 17 judicial scriveners who focus on legal documentation work. Most of their training is focused on the Companies Act and Civil Act. Our group also includes lawyers and land and real estate evaluation specialists.

What are your expansion plans?

Besides Tokyo, we have offices in Kyoto and Fukuoka. We also have a staff member working with a local lawyer in Shanghai and we are looking at setting up operations in Singapore.

What is a typical day for you?

I work a lot at home in the morning and show up at the office between 8 a.m. to 10 a.m. Usually, I meet with individual division heads and I go out a lot to meet clients because in a way, I am the top salesman for the group.

How do you like to relax?

I play with my child on weekends and enjoy golf.

© Japan Today

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It costs ¥28,000 and very easy to do.

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JapanGal -- huh? Where did you get that number? The JPY 28,000 is only one small part of the actual cost of starting a company in Japan, especially if you do read Japanese/kanji, as you will undoubtably need legal advice from a firm such as this one. For example, you must pre-pay a year's expected taxes. I think you need to re-check your figures.

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you must pre-pay a year's expected taxes. I think you need to re-check your figures.

you sure about that! Considering most companies take a while to make money let alone pay taxes..................

I have worked for myself for almost 15yrs now & have never pre-paid any taxes, I make payments mid & late in thge calendar year then pay off the rest or get a refund come the following March but have never prepaid

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You have to pre-pay anticipated taxes. I am guessing in the first year, since there are no earnings, you do not, but after that you do. Tax time is in March/April, so your other income tax payment are a fraction of anticipated taxes for the next year, which then get deducted from the taxes you owe for the next calendar year. If your revenue is always the same, then you won`t notice a difference in the taxes you pay.

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best to open in singapore 1$ only and 7$ a month for registry. tax is much cheaper than japan too

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What your talking about are simple installments on the years taxes, paid in the year they apply for, then settle up any outstanding or re-funds, year ends can be calendar year end, most end in March & some even end in June

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"equity security" as defined within the Federal Register and Code of Federal Regulations with Commission (Securities Exchange Commission) authority Office of Rulemaking, Division of Corporation Finance has a broad recognition and requires examination and investigation with exchange of assets and or valuation. This has some importance with market sector analysis when intangible and tangible assets under the Companies Act  with Corporate Social Responsibility enforce chain of trust fungibility of market sector telecom fair market value. Review Federal Register NOTICE for 67 FR 19671, SEC, Rulemaking, pages 19671-19673 (3 pages) in these regards.

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