This year, major revisions are underway to the acquisition and renewal of the residence status of those with business management visas. An increase in the number of “nominal managers” who do not actually perform management duties is on the increase, and consequently the requirements for obtaining a residence status for business management are expected to become significantly stricter. This article explains the specific changes, the background behind them, and future measures in detail.
Major changes to the requirements for applying for business management status of residence
Significant increases in investment amounts for new application
Until now, it has been possible to apply for a new business management residence status with an investment of 5 million yen. However, according to media reports, the following requirements are scheduled within the year:
New Requirements
- Investment amount: 5 million yen → 30 million yen (6-fold increase)
- Employment requirements: Must employ at least one full-time employee
- A Master's degree or higher, or three years of management or administrative experience.
- The business plan must be reviewed by a qualified professional with specialized knowledge, such as a certified management consultant.
These changes will significantly raise the bar for new applications. In particular, the employment requirements are likely to be quite challenging for companies looking to enter the market.
However, there are exceptions to the above. The Japanese government is moving toward granting residence status to highly skilled foreign nationals who are seriously considering starting a business in Japan under the same requirements as before. Specifically, this refers to individuals who have entered Japan on a startup visa issued by the Ministry of Economy, Trade and Industry or a JFIND Visa after graduating from a designated university, and then established a company in Japan and started business operations. (The J-Find visa, officially known as the Japan System for Future Creation Individual Visa, allows recent graduates from top-ranked universities worldwide to stay in Japan for up to two years to find employment or prepare for starting a business.)
Stricter Documentation for Renewals (Already in Place)
The documents required for renewal applications have already increased. Up to now, renewal applications could be made using a company’s financial statements and tax documents submitted by company executives. However, from July 2025, it has become mandatory to submit a document explaining the specific business activities during the renewal period. However, this requirement may not apply to companies of a certain size. This requirement has just come into effect. However, depending on the contents of the submitted document, you may be required to provide additional documentation to clarify the business activity.
In any event, if you are not seriously managing a company in Japan, getting a renewal will be difficult.
Background for stricter residence status for business managers
Low investment compared to other countries
The previously required investment amount of 5 million yen has been strongly criticized as being significantly lower than the investment amount required for similar visas in other countries. As such, the investment amount needs to be increased. For example, neighboring South Korea requires a minimum investment of the equivalent of at least 30 million yen. The new required investments amounts in Japan will be closer to the amount required by South Korea.
Increasing abuse of the business management residence status system
The following problems seem to be prevalent particularly among Chinese applicants.
- Nominal managers: Someone who does not engage in actual management activities and uses their position merely as a means of staying.
- Free riding on social insurance systems: Applications made solely for the purpose of receiving social security benefits in Japan
- Reporting inflated income: Where inflated revenue that differ from actual figures are reported for tax purposes and used to update business management.
- Dozens of companies owned by Chinese business people and all located at the same address, but there are no reports of people entering and leaving the premises or any indication of business operations. In the future, strict measures will be taken against those who do not meet these requirements.
Future measures and things to keep in mind
For those who are considering a new application
- Prompt review of the application: If you are thinking about applying before the revisions come into effect, pay attention to the trends within the year.
- Substantive business plan: Draft an informal, feasible business plan
- Sufficient financial preparation: Create a financial plan that reflects the future system changes
- Consider getting a startup visa or a J-Find Visa
For those who have already obtained the visa
- Substantive management activities: Implementation of actual business activities, not just nominal ones
- Proper record keeping: Keeping detailed records of business activities
- Proper reporting of revenue: accurate revenue reporting based on actual conditions
- Early state of renewal preparation: Set aside preparation time for making the explanatory documents.
Summary
Although Japan welcomes foreign investors who truly contribute to the revitalization of Japan's economy, the changes discussed in this article are aimed at eliminating "nominal managers" who abuse the system. For those who are conducting appropriate business activities, this may be a welcome change that will lead to greater reliability in the system.
However, due to significant changes in requirements, the difficulty of applying and renewing will definitely increase. For consultations regarding business manager visas, we urge you to consult with an experienced professional as soon as possible.
Kobe Legal Partners is happy to provide advice to foreign nationals who are seriously considering starting a business in Japan.