This blog series aims to give you a general overview of the process of starting your business in Japan. In this blog entry, we look at the process of depositing initial capital and opening a corporate bank account.
If you have chosen to establish a company in Japan, whether it be a kabushiki kaisha or gōdō kaisha (see “Starting your business in Japan pt. 1: Selecting your type of operation”), one of the conditions is to deposit initial capital. This usually occurs after the drafting and notarization of the articles of incorporation.
During the company registration process, a document called “proof of deposit of capital” (haraikomi shōmeisho) is required in order to prove that the deposit has taken place.
Proof of deposit of capital must contain the following information:
1. Amount of deposit
2. Number of initial shares
3. Date of deposit
4. Name and address of company
5. Name of representative director
6. Copy of bank book (for the bank account to which the deposit was made)
As the company does not yet exist, a personal bank account is usually used to receive the initial deposit. The account can either be with a Japanese bank or the Japanese branch of an overseas bank, and must belong to either the incorporator, representative director*1, or an agent*2.
*1 In this case, a power of attorney authorizing the representative director to receive the initial deposit is required.
*2 If both the incorporator and representative director do not live in Japan (and thus do not hold a Japanese bank account), an agent can be appointed to receive the initial deposit. TOMA can act as your agent in this case, so please contact us if this applies to you.
If more than one incorporator exists, the bank book must show the name of the depositor of funds. As such, it is important that funds are transferred from the incorporator’s account and not cash-deposited.
Once the deposit of initial capital is made and the necessary documents prepared, the company can be officially registered at the Legal Affairs Bureau.
Opening a corporate bank account
Once the company is registered and operating, the next step is to open a corporate bank account. The entire process could take up to a month, so it is important to start well in advance if you expect to receive money from your customers.
Most major banks have an online application form to get the process started. During this process, information such as the company’s shareholders (if shareholder is a company, its ultimate beneficial shareholders), directors, business purpose, etc. must be provided.
To prevent the possibility of crimes such as money laundering, banks are very thorough during this screening process. Applicants that are turned down are generally not given a reason, so adequate preparation and provision of information are recommended. In addition, many banks require the representative of the company to have a Japanese visa. If your company representative is overseas, it is necessary to confirm with the bank in advance.
Once accepted, an in-person visit will be requested at a bank branch closest to your main business office.
The following documents are usually required during the visit:
1. Certificate of registered matters
2. Seal certificate
3. Identification of the person visiting the branch
4. Power of attorney*
*Required when the person visiting the branch is not the representative of the company.
TOMA can help you through the entire company establishment process, even if your current representatives are outside of Japan. This includes and is not limited to the following:
1. Acting as an agent to receive the initial deposit
2. Visa application for employees/directors
3. Opening a corporate bank account
4. Management of bank account after it has been opened
Please get in touch with us through the Contact Us tab above.