Japan is becoming an ideal destination for international technology and artificial intelligence (AI) businesses. Not only attracting giants such as OpenAI, Anthropic, Microsoft, SoftBank, but also Vietnamese businesses such as FPT Software, CMC Technology are expanding strongly in Tokyo. With urgent demand for automation, support from the government and a potential market, Japan opens up great opportunities for AI companies wanting to assert their position in Asia.
If you are looking for How to set up a company in Japan to do technology business (AI)This article will provide a comprehensive overview from legal conditions, costs, procedures to special advantages when doing AI business in Japan.
1. Why is Japan attractive to technology and AI companies?
Japan is facing one of the biggest challenges of the 21st century: a rapidly aging population and a shrinking workforce. This is a national problem that Japanese businesses, government and society must find a way to solve.
In that context, AI has become a strategic solution to automate, optimize processes and reduce dependence on traditional human resources. This urgent need has opened up a large market for international technology companies.
Advanced technology environment
Japan is globally renowned for its strengths in robotics, IoT, and smart manufacturing. Its tech ecosystem is increasingly integrating AI into areas such as manufacturing, finance, logistics, healthcare, and self-driving cars.
This is a favorable platform for international AI companies to cooperate, test and deploy products right in a highly applicable market.
Legal corridor and support policies
The Japanese government has placed innovation and digital transformation at the heart of its economic development strategy. Many preferential policies, support funds and international cooperation programs have been implemented to attract foreign technology enterprises, especially in the field of AI.
This helps international companies when opening branches or subsidiaries in Japan not only be welcomed but also have access to financial and research resources.
Potential business customers
Japan is home to many of the world's leading corporations such as Panasonic, Rakuten, SoftBank, Toyota, Honda, etc. These are all business-to-business (B2B) customers with strong demand for AI applications in manufacturing, e-commerce, telecommunications, and financial services.
For international AI companies, having a presence in Japan makes it easier to access global partners, expand business scale and affirm prestige in the Asian market.
2. Reality: Many “big guys” choose Japan to expand AI
It is no coincidence that Japan is continuously chosen by the world's leading technology companies to expand their operations. In just the past few years, the wave of investment and presence of large enterprises in the field of AI in Japan has become increasingly evident.
Anthropic – Strategic move with Tokyo office
anthropic, the famous American AI company with the Claude app, has officially announce plans opened its first Asian branch in Tokyo. The new office focuses on serving Japanese corporate customers and also cooperates with large corporations such as Panasonic and Rakuten Group to deploy products.
It can be said that this move not only helps Anthropic get closer to Japanese customers, but also affirms that Tokyo is becoming Anthropic's strategic "gateway" to penetrate deeper into the Asian market.
OpenAI – Tokyo becomes the first destination in Asia
Before Anthropic, OpenAI – the name associated with ChatGPT – also took a similar step. In April 2024, OpenAI chose Tokyo as the location for its first office in Asia. Not only simply expanding its presence, OpenAI also revealed plans to “localize” the GPT model for Japanese – a move that shows its seriousness in this market.
Microsoft – Investing Billions of Dollars in AI in Japan
Not staying out of the game, Microsoft – the American technology giant – also stepped up its investment with a $2,9 billion package in cloud computing infrastructure and GPUs in Japan. At the same time, the company also established the Microsoft Research Asia research center in Tokyo, focusing on pioneering areas such as embodied AI, social AI and neuroscience.
Microsoft's goal is clear: to bring AI from the lab into practice, accompanying Japanese businesses on their digital transformation journey.
SoftBank + OpenAI – Joint Venture SB OpenAI Japan
Another bright spot is the SB OpenAI Japan joint venture, a collaboration between SoftBank and OpenAI. With an investment budget of up to billions of dollars per year, this joint venture not only provides AI solutions for the Japanese market, but also sends a strong message: Japan wants to play a central role in the Asian AI map.
Sakana AI – Japan's Domestic AI Star
Not only is Japan riding the international wave, it is also witnessing its own rise. Sakana AI, a startup founded by two former Google engineers in Tokyo, has reached a valuation of $1,5 billion just one year after its launch.
Sakana AI focuses on collective intelligence research, a different direction that demonstrates a very "Japanese" creative spirit: when AI is not just technology, but also a philosophy of connecting people.
Vietnamese Enterprises – Firm Steps into Japan
Besides global corporations, Vietnamese enterprises are also asserting their position in the Japanese market:
- FPT Software: more than 20 years of presence, with thousands of employees and many AI projects for Japanese corporations.
- CMC Technology: opens third office in Tokyo (2024), becomes a member of Keidanren - Japan's leading economic organization.
Additionally, companies like NashTech, VSII are also entering the market with AI and digital transformation services.
Besides Japan, Singapore, Mỹ, Hong Kong are also potential countries to open companies, register technology IP and develop AI, and call for technology investment capital.
3. Benefits of establishing a company in Japan to do business in technology (AI)
Choosing Japan as a destination to open a company in the technology field, especially AI, brings many practical benefits to businesses:
3.1 Access to high-demand, high-budget AI markets
Japan is one of the countries investing heavily in AI with many application areas: healthcare, automated manufacturing, finance, logistics, retail. The Japanese government and businesses are willing to spend large budgets to deploy AI solutions, opening up abundant cooperation opportunities for startups and international companies.
3.2 Leveraging the ecosystem of cooperation with Japanese corporations
Big names like Sony, SoftBank, Rakuten, and Panasonic are always looking for technology partners to increase their competitiveness. New businesses can take advantage of this ecosystem to collaborate on research, product development, or expand distribution channels.
3.3 Policy support and funding from the government
The Japanese government is promoting Digital Transformation (DX) and Society 5.0, with AI as the focus. Preferential policies on tax, research funds, and support for international startups help foreign businesses reduce risks and accelerate development.
3.4 Increase brand reputation when setting up an office in Tokyo/Osaka
Owning an office in Tokyo or Osaka – the two largest economic and technological centers in Japan – helps businesses enhance their reputation in the eyes of international partners, while easily attracting high-quality human resources in the technology industry.
With these advantages, Japan is not only a potential market, but also a strategic springboard for technology and AI companies to expand globally.
4. Forms of presence in Japan for international AI companies
Technology companies, especially in the AI field, can choose from a variety of forms of presence when expanding to Japan.
Depending on your business strategy, investment level, and long-term development needs, you can consider one of four options. Japanese company types popular after:
4.1 Establishment of Branch Office
A branch is a direct extension of a parent company overseas. Businesses can use the branch to conduct business, sign contracts, and provide AI services right in Japan.
- Advantages: Quick establishment procedures, lower operating costs compared to subsidiaries.
- Limitations: The parent company is directly legally and financially responsible for all activities of the branch.
4.2 Establishment of a subsidiary
A subsidiary is an independent legal entity, usually established as a Kabushiki Kaisha (KK) or Godo Kaisha (GK) in Japan. This is the form chosen by many large corporations in the AI field for long-term development.
- Advantages: Independent legal entity, increased reputation with Japanese customers, easy to sign large contracts.
- Disadvantages: Requires charter capital, more complicated establishment and maintenance procedures.
4.3 Representative Office
Representative offices are suitable for new businesses exploring the market. These offices are not allowed to conduct revenue-generating business activities but only focus on research, surveys, marketing or communications.
- Advantages: Easy to set up, low cost.
- Restriction: No direct revenue generation in Japan.
4.4 Joint Venture with Japanese company
This is a form of cooperation with a Japanese partner to establish a joint venture company. This model is suitable for AI businesses that want to take advantage of the resources, available customers, and local knowledge of the Japanese partner.
- Advantages: Cost savings, risk reduction, easy access to Japanese customer network.
- Limitations: Clear agreement on equity ratio, control rights and development strategy is required.
In general, if an AI company wants to test the market quickly, a representative office or branch office will be suitable. But if the goal is to build a brand, sign large contracts, and grow sustainably, a subsidiary or joint venture will be a more strategic choice.
5. Basic procedures to open a technology company in Japan
Job set up company in japan, especially in the field of AI and Digital Transformation, in Japan requires careful preparation and compliance with many legal regulations. Below are the basic steps with support solutions from GLA:
Step 1: Select legal type: KK, GK or Branch
- Kabushiki Kaisha (KK): Joint stock company, highly reputable, easy to attract Japanese partners.
- Godo Kaisha (GK): Similar to LLC, low cost, flexible management.
- Branch office: Suitable for companies that already have a parent entity and want to quickly establish a presence.
GLA helps you analyze the advantages and disadvantages of each type, and advises on the type that is suitable for your business's AI expansion strategy.
Step 2: Prepare capital conditions, office address and seal
- Minimum capital: Not required, but usually recommended is 5–10 million Yen to build trust with partners.
- Office address: Must be in Japan, usually in Tokyo or Osaka for convenient transactions.
- Seal (Hanko/Inkan): Must be officially registered for use in legal transactions.
GLA supports you in renting offices in Japanese technology centers, consulting on appropriate capital levels, and preparing procedures for registering a seal for your company.
Step 3: Business registration and Japanese corporate tax
- The application is submitted to the Legal Affairs Bureau.
- After obtaining the certificate of incorporation, it is necessary to register for tax at the local Tax Office.
- For AI companies, additional licenses related to IT services or data processing may be required.
GLA supports drafting registration documents, representing submissions to Japanese agencies, and providing specific tax advice for technology businesses, especially in international transactions.
Step 4: Apply for a work visa for foreign experts
- The AI technology field often requires international personnel, so companies must sponsor visas for experts.
- Popular visa types: Engineer/Specialist in Humanities/International Services or Business Manager Visa for founders.
GLA advises on the appropriate visa type, prepares sponsorship documents, and accompanies your team of experts during the visa application process.
Step 5: Register copyright & intellectual property
For AI companies, intellectual property (IP) is a core asset. Japan requires software copyrights, patents, and trademarks to be legally protected. This is especially important when working with Japanese corporations.
GLA supports connections with copyright lawyers in Japan, supports trademark registration, AI patents, and advises on strategies to protect businesses' intellectual property.
The process of opening an AI company in Japan is quite complicated but completely feasible with the support of GLA. With practical experience and a network of partners in Japan, GLA helps your business save time, reduce legal risks and quickly exploit the potential of the AI market worth tens of billions of USD in Japan.
6. Challenges & Notes for Technology Companies (AI) in Japan
When opening a technology company, especially in the AI field in Japan, international businesses need to be well prepared for the following challenges:
- Fierce competition from local and international businesses: Japan has many large technology corporations (NEC, Fujitsu, SoftBank, NTT Data) and a series of thriving AI startups. Market penetration requires foreign companies to have different solutions, outstanding technology or clever cooperation strategies.
- Data Privacy, AI Ethics: Japan has strict regulations on personal data (APPI – Act on the Protection of Personal Information) and is increasingly focusing on AI Ethics. Businesses need to ensure that AI systems comply with the law to avoid legal risks.
- There are cultural differences: The Japanese value trust, long-term relationships and collective decision-making. If foreign companies do not understand this culture, negotiating and cooperating with Japanese companies/partners can be difficult.
- High operating and personnel costs: Tokyo and Osaka are among the cities with the highest cost of living, office rent and salary in Asia. Businesses need to carefully budget when operating here.
7. How to leverage AI trends to succeed in Japan
International businesses looking to expand into the Japanese market can take advantage of the artificial intelligence (AI) trend through the following strategies:
- Investment in research & development (R&D) in Japan: Establishing an R&D center in the country helps businesses access high-quality human resources, quickly update new technology trends and grasp the actual needs of the Japanese market.
- Combining recruitment of local AI engineers and international experts: This combination brings a balanced advantage between global technological knowledge and understanding of Japanese consumer culture, behavior and tastes.
- Multilingual AI Product Development, Japanese priority: Localization is not just about language translation, but also about adjusting the user experience to suit Japanese culture, thereby increasing trust and competitive advantage.
- Cooperate with large corporations in Japan: Partnering with leading names such as Panasonic, SoftBank or Rakuten will help businesses expand their ecosystem, increase brand reputation and quickly reach a large customer network.
International AI companies that want to succeed in Japan need to combine technological innovation, product localization, and strategic partnerships. This is the key to helping businesses make a lasting mark in one of the world's leading technology markets.
8. How does GLA support you in establishing an AI technology company in Japan?
GLA provides comprehensive solutions to help international businesses open technology companies, especially in the field of artificial intelligence (AI), in Japan, including:
- Advisory choose the type of company suitable (Kabushiki Kaisha – KK or Godo Kaisha – GK) to optimize tax, legal and capital raising capabilities.
- Support in drafting and submitting company establishment documents to Japanese legal authorities, ensuring compliance with regulations.
- Providing business registration office address and representative office services for a quick start without renting a large headquarters.
- Consulting on visa/entrepreneur and residence permit for founders and AI experts who want to go to Japan to run a company.
- Connect to open a corporate bank account in Japan or an international bank that supports technology businesses.
- Legal - accounting - tax support for companies to operate legally, especially in the high-tech field (AI, data).
- Long-term companionship: Not only supporting the establishment stage but also accompanying the Enterprise throughout the development process in Japan.
With experience in supporting Vietnamese businesses to expand globally, GLA is a reliable partner for you to lay a solid foundation for your AI company in Japan.
9. Frequently asked questions when opening a Japanese company to do technology business (AI)
1. Is it possible to open a 100% foreign-owned technology company in Japan?
Yes. Japan allows foreign investors to own 100% of the company's capital. You can choose to establish Kabushiki Kaisha (KK) or Godo Kaisha (GK) without having to have Japanese shareholders or members.
2. What type of company is suitable for AI business in Japan?
AI companies often choose Kabushiki Kaisha (KK) because this type is highly regarded for its reputation, easy fundraising, and cooperation with large corporations. If you want simpler procedures and lower costs, Godo Kaisha (GK) is also a suitable choice.
3. Does Japan have a program to support foreign technology startups?
Yes. The Japanese government and local governments such as Tokyo and Osaka often have programs to support AI and high-tech startups through:
- Tax breaks and financial assistance.
- Connect with venture capital funds and R&D centers.
- Business Manager Visa for foreign founders.
Contact GLA for advice and support on policies to support your business when establishing a company in Japan.
4. Do I need a Japanese partner to open a branch?
Not required. Foreign companies can open branches or subsidiaries in Japan without a local partner. However, having a Japanese partner will help facilitate access to the local market, customers, and business networks.
- Japan is a potential but fiercely competitive market for technology (AI) companies, especially with high requirements on data security and business culture.
- Many leading brands such as Anthropic, OpenAI, Microsoft, SoftBank and Sakana AI have chosen to open companies, set up offices or expand operations in Japan, showing the strong attraction of the technology market here.
- Foreign enterprises can open 100% capital companies in Japan with many suitable options, but need to carefully prepare for operating costs and personnel.
- Success in Japan depends on combining local R&D, hiring local staff, building multilingual products, and partnering with large corporations.
- GLA can accompany you every step of the way — from legal advice, company formation, to compliance and long-term growth in Japan.
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