Top 10 Tips about Doing Business in Japan

Japan is the third largest economy in the world, but it is ranked 114 in terms of how easy it is to do business there. Having the right local help is essential for foreign companies to operate in powerful East Asia.

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Japan is the third largest economy in the world, but it is ranked 114 in terms of how easy it is to do business there. Having the right local help is essential for foreign companies to operate in powerful East Asia.

The Japanese economy is ranked third in the world in terms of its gross domestic product (GDP), but is ranked 114 for the ease it offers to do business. Despite its internal competence, having local help is essential for the smooth development of a company from abroad.

Japan is a leading innovation center that prides itself on its extremely attractive commercial and living environment immersed in one of the world’s leading economies. A survey by the Ministry of Economy, Trade and Industry (MECI) concluded that Japan has a stellar reputation among Western and Asian companies, which are attracted to both their Research and Development capabilities and their staff and laws, including , those that deal with intellectual property rights.

Many companies also approach Japanese coasts because of their highly developed consumption base. The huge market marks a trend among regional economies, and many companies use it as a test place. 49% of companies see Japan as an attractive test market, and 40.5% say it is a good environment for commercial expansion.

However, the high level of local competition or that of other countries, the numerous regulatory difficulties and cultural factors may make it difficult to enter Japan. For this reason, having local help can be an advantage when it comes to expanding in the country.

Start a company

The process of starting a business in Japan can be exhausting: there are many levels of bureaucracy that must be passed before a company can establish itself there. Organizations should contact the city council, the Legal Affairs Office of the Ministry of Justice, the district tax office, the local tax office, the Labor Standards Inspection Department, the Japan Pension Service, and the Public Office. of Work Bags before starting any other procedure.

Take care of building permits

According to the World Bank and the International Finance Corporation (IFC), managing construction permits takes 193 days, much longer than the OECD average. There must be about 14 procedures that involve numerous government agencies and local authorities.

Obtaining electricity

Tepco, Japan’s electricity company, provides electricity to the capital and surrounding areas. Connecting to the network takes an average of 105 days. Companies must set a construction date, send a request and wait for connection work before their meter is installed.

Property registration

Registering a property is an extensive procedure that requires a certificate of the stamp printing of the seller, the payment of the stamp in the mail, the application in the Office of Legal Affairs and the payment of the tax on the acquisition of real estate.

Obtaining credits and protecting investors

Japan’s modern financial system means that getting credit there is a relatively simple procedure. The legal system also offers adequate protection to investors, although the process has not been perfected as much as in other countries.

Tax payment

The Japanese tax system is the victim of its own predilection for bureaucracy. The World Bank and the IFC place Japan in 123rd place in the world for its corporate tax system, which can consume up to 330 hours per year in management time and demand the payment of 14 annual taxes. The corporate tax rates are 30%, with a series of other charges that also require consideration.

Marketing in other countries

Japan is an archipelago formed by 6852 islands. Therefore, it depends on the fluid trade with other countries. Only ten days it takes to export, and five to import. The cost is just lower than the OECD standard.

Contract compliance

The fulfillment of contracts takes 360 days and costs 32.2% of the claim. It involves 30 procedures of which the judicial ones are those that take more time.

Insolvency resolution

Japan is ranked first in the world for the resolution of insolvencies, since the procedures in that country just take six months and cost only 4% of the assets. In addition, the recovery rate exceeds 90% versus the average 70% of the OECD.


In Japan relations govern business. For this reason, it is important to show proper respect as well as be kind and diplomatic at all times. Patience is essential for business relationships, so observing the rules of etiquette regarding gifts is important.