Business Administration in Japan

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Setting Up a Company

Legal Business Entities

Types of Companies and Capital (Max/Min) Number of Partners/Shareholders and Liability Registration Fees
Kabushiki Kaisha (KK), Public limited company.
Minimum 10 million Yen
No minimum since the reform of the Commercial Code .
Limited to the amount of capital contributed
0,7% of the capital with a minimum of YEN 150,000.
Yugen Kaisha , Limited liability company
Minimum 3 Million Yen
50 shareholders maximum
Limited to the amount of capital contributed
YEN 60,000
Goshi Kaisha, Limited partnership
No minimum capital
No minimum
2 types of partners: active partners and sleeping partners.
Unlimited for the active partners
Limited to the amount of capital contributed for the sleeping partners .
YEN 60,000
Gomei Kaisha, General partnership.
No minimum capital .
2 partners minimum
YEN 60,000
Business Setup Procedures
The administrative formalities depend on the structure created (branch office, subsidiary company or limited liability partnership). Click here to find the appropriate procedures to follow.
The Competent Organization
The administrative formalities must be carried out at the bureau of legal affairs of the Ministry of Justice.
Search a Company or a Financial Report
Japan Company Info

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Working Conditions

Legal Weekly Duration
8 hours per day and 40 hours per week
But employees frequently work 50 or 60 hours a week. Compared with the United States, the United Kingdom, France and Germany, Japanese employees work the most (in hours worked in industry).
It is also the country with the least annual vacation (weekly rest day and paid holidays included).
Retirement Age
Age 65 with a minimum of 25 years of contributions. An early pension is payable between ages 60 and 64
Working Contracts
In Japan, the contract determines if the employee is part of the regular or non-regular staff. Permanent employees form the regular staff. Among the non-regular staff, there are different types of contract: part-time workers, temporary workers, dispatched workers, fixed-term contract workers, entrusted employees (shokutaku).
Permanent contracts represent 65.4% of job total. 23% of jobs are non-regular jobs under part-time contracts.
Because of the economic recession which set in during the 1990’s, recourse to part-time jobs has developed considerably.

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Cost of Labor

Minimum Wage
There are three types of minimum wage:
- Local minimum wage
- Local industry-specific minimum wage- national industry
- Specific minimum wage.
The prefectures set the amount of local minimum wages. Minimum wages (general and industry-specific) set by the prefectures are around JPY 668 per hour.
Average Wage
Average annual gross earnings in Japon is JPY 2,899,413 (USD 30,000).
Social contributions
Social Security Contributions Paid By Employers: 10.89%
Social Security Contributions Paid By Employees: 11.27%

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Social Partners

Social Dialogue and Involvement of Social Partners
90% of unions are Company unions. Company unions (one per company) exist inside the Company to discuss working conditions.
Labor unions are organized cross-corporate organizations. The elements of claims made by the labor unions are then a basis for claims by the Company unions.
There are two types of labor unions: the Industrial Trade Unions and the National centers (mainly Rengo, the Japanese Trade Union Confederation).
Rengo and management organizations such as Nippon Keidanren (Japan Business Federation) have established a venue for regular discussions. For issues on which they share the same opinion, a joint policy proposal is duly submitted to the central government, especially at the Governmental Councils created for this. Every year between March and April, the unions launch an offensive on wages; it is known as Shunto, the spring wage offensive.
Nippon Keidanren
Unionization Rate
18.7% in 2005.
The rate is constantly dropping with a reduction registered especially in the private sector, in SMEs and micro-enterprises.
Labor Regulation Bodies
The Labor situation in Japan, Institute for Labor Policy and Training
Ministry of Health, Labor and Welfare
The representation of the International Labor Organization in Japan

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  • Teikoku Databank America, Inc.

    Credit, Market Research,Japan, Japan