Advantages of Setting Up a Branch Office in Japan

As its name indicates, a Japan branch office is a branch of a foreign company in Japan. The main advantage of setting up a branch office in Japan is simplicity:

  • No articles of incorporation are needed (A simple affidavit based on a foreign corporation is necessary)
  • No capital is needed
  • No corporate secretary is required (no need to hold an annual shareholder meeting.

If the company decides to close a branch office, closing is much easier than approaching a Joint Stock Company or Limited Liability Company LLC of G.K.

However, the company still has the accounting and tax filing obligations as any other type of company in Japan: – G.K. (Japan LLC) or K.K. (Japan Stock Company)

Drawbacks of Setting Up a Branch Office in Japan

  • The Japan branch office is a branch of the parent company and is not considered an independent legal entity. Therefore, in the case of the tax audit, Japanese tax authorities may require access to the accounting information of the parent company of the Japan Branch Office.
  • A Japan resident representative is necessary to create a Japan Branch Office. Kawaii can provide Japan branch representative services and also registered addresses.

What is Needed to Create a Branch Office?

  • Define the name of the branch in Japan
  • Define the purpose of the company
  • Affidavit
  • Obtain a Japanese registered address (Achieve Japan can provide a registered address in Japan under certain conditions)
  • Name a Japanese resident as a representative of the branch office
  • Achieve Japan can provide a questionnaire that outlines the main issues to be considered on request to corporate clients

Primary Obligations of a Branch Office

  • The Japanese branch office needs to be registered with the Japan Legal Affairs Bureau
  • The Japanese branch office requires to be registered with the relevant tax office.
  • Statutory accounting: the Japanese company has to maintain a General Ledger in Japanese Yen.
  • Achieve Japan accounting services can help you fulfill this obligation.