Is it possible for a foreign national to start a side business in Japan?

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Incorporating a company in Japan is relatively easy but it may be difficult under certain circumstances for some foreigners living in Japan to be a founding member of a corporation.  The two main difficulties that foreign nationals will encounter when establishing a side business in Japan are restrictions in their employment contract at their main job and the restrictions of their Japanese visa.

If the foreign national is currently employed with a Japanese company, the employment agreement between the foreigner and the employer may restrict employment at other jobs.  This could prevent the foreigner from starting another business or taking a position as a director of a separate company.

Furthermore, foreign nationals also have to worry about the type of visa that they are using to reside in Japan.  While some visa types, such as spousal visas, allow an almost unlimited scope of activities in Japan, other visas restrict the foreign national’s activities to a specific type of work.  Therefore, starting a side business or taking a position as a director at a newly formed company may be a violation of that foreigner’s visa status.

If you have any questions about starting a business in Japan, please contact our office for a legal consultation.