Japan relaxes regulations for foreign investors

According to Nikkei newspaper on March 3, this March, the Japanese Government will adjust and amend regulations in case foreigners want to establish companies in Japan.

The Japanese government said it wants to create a favorable environment to attract foreign investors who want to start businesses in the Land of the Rising Sun.

A foreign company operating in Japan. (Source: autoevolution.com)

The most important change is that Tokyo will abolish the requirement that at least one of a company's board members must reside in Japan.

In parallel with the removal of this condition, the Japanese government will also relax the conditions for granting residence status to foreign investors establishing companies in Japan.

Investors who meet the requirements to register to open a business in Japan will be granted a residence status for a period of four months. After the four-month period, the Japanese government will conduct an examination and evaluation of the company establishment and business operations process to grant a longer residence status, which can be up to five years.

With these amendments, it is much easier for foreigners to open a business in Japan without having to cooperate with a person residing in Japan. After opening a business, investors can hire Japanese workers and include them in the company's board of directors if they see fit.

Until now, the requirement that at least one of a company's board members must reside in Japan was applied with the view that local authorities could easily control corporate representatives in case the company broke the law or harmed consumers.

With this regulation, without the assistance of a Japanese citizen or a person residing in Japan, foreigners have almost no chance of obtaining a residence status or residence card to be eligible to establish a business in Japan.

This is one of the measures to attract foreign direct investment into Japan, a part of the growth strategy announced by Prime Minister Shinzo Abe. The Japanese government aims to attract 35,000 billion yen in foreign investment by 2020, double the figure in 2012./.

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