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Fukuoka City's founding support for foreign entrepreneurs

Fukuoka City's founding support for foreign entrepreneurs

"Featured City Fukuoka"

 Fukuoka City’s initiatives highlight the many advantages our city has to offer residents and business owners. The national government has recognized these initiatives and the city’s attractivness, by selecting Fukuoka as the Global Hub for startup eco-system and National Strategic Special Zone (The National Strategic Special Zone for Global Startups & Job Creation). This is due to efforts made to ensure Fukuoka is the ideal place to create a business. With this designation, we can now carry out significant reforms that weren’t previously possible and make our city even more appealing. We will use this Global Hub certification to continue our cooperation with Japan’s national government in strengthening our ties overseas.

 In this newsletter, we will introduce you to Fukuoka City’s startup support for foreign entrepreneurs and show you why our city attracts founders and companies from around the world, and why it is also recognized by the National Government as an attractive city.

 ~ Definition ~ National Strategic Special Zone: A special zone designated to reform regulations and systems in a limited area and verify their effects in order to revitalize Japan's economy. Six regions (initially) including Fukuoka City have been designated, and Fukuoka City will work to support the establishment of businesses and create employment opportunities as a National Strategic Special Zone for Global Startups & Job Creation. (*Currently there are 10 special zones)

Japan’s first Startup Visa

(Entrepreneurial Incentives for Foreigners)

* Note: some usage requirements are omitted, and support content is explained in the text below.

 As one of the National Strategic Special Zone initiatives, Fukuoka City has been approved to implement the Startup Visa (Entrepreneurial Incentives for Foreigners) to incentivize foreigners to be business entrepreneurs in Fukuoka. Prerequisites for the Business Manager visa, which is required for foreigners intending to start a business in Japan, will be eased for foreigners who found his/her business in Fukuoka (National Strategic Special Zone).
Foreign entrepreneurs are required to open a business office and hire two or more permanent employees or have capital/investments exceeding five million yen upon submitting his/her application to the Immigration Bureau in order to receive approval for the Business Manager residential status.
The Startup Visa system permits foreign entrepreneurs to receive a six-month Business Manager visa without fulfilling the aforementioned prerequisites. The entrepreneur must, however, submit a New Business Implementation Plan (NBIP) to Fukuoka City. After evaluating the NBIP, should Fukuoka City confirm that the entrepreneur is expected to fulfill the visa requirements, the Immigration Bureau will evaluate the candidate based on Fukuoka City’s confirmation. If approved, foreign entrepreneurs are given six-months to fulfill the standard prerequisites and complete procedures while developing his/her business.

Office Space

 Previously, it was necessary to rent an exclusive office space in order to renew the visa after staying for six months. However, starting in June 2020, the requirements were relaxed, making it possible to use coworking spaces (spaces not designed to function as exclusive offices) as a company’s registered office from the first renewal date until the date of the visa’s expiration.

 Fukuoka’s registered coworking spaces are comfortable to work in, close to the city’s urban areas, and provide unique benefits such as a space with ocean views. Thinking about starting your business in Fukuoka City and taking advantage of one of the many excellent coworking spaces? Below is a list of the target coworking spaces you should visit. This list was last updated in October 2020. (Some of them have English language websites)

1. Fukuoka Growth Next English language website available
2. BOOK & CO.TENJIN
3. Wissquare Fukuoka
4. Shared office SALT
5. The Company Canal City Hakata Front English language website available
6. The Company Fukuoka PARCO English language website available
7. WeWork Daimyo English language website available
8. WeWork Gates Fukuoka English language website available
*Note: We will add more coworking spaces to this list in the future. As of October 2020, Fukuoka City and Sendai City are the only cities in the nation where the relaxation of exclusive office space requirements applies.

Japan’s First Tax Reduction for Startups

 The Tax Reduction for Startups is a full exemption of the Corporate Citizen Tax for up to 5 years for corporations that have been in business for less than 5 years. This city tax reduction measure is unique to Fukuoka City and began in April 2017.

 This is Japan’s first local government-specific reduction measure in line with the national tax reduction measures in the National Strategic Special Zones. In order to receive the Tax Reduction For Startups, it’s necessary to meet certain requirements such as utilizing one of the special measures that is specific to the National Strategic Special Zones and being an innovative business in one of the following five fields: medical care, international, agriculture, certain IoT, and advanced IT.

Specified Startup Support

 Fukuoka City helps founders learn more about launching a business via the National Specified Startup Support program. The program focuses on management, finance, market development, and resource development. Founders who receive this support can access the five benefits listed below.

1. Reduced Company Registration Cost
Fukuoka Company Registration fees will be reduced by half.
Joint-Stock Company (Kabushiki Gaisha): 150,000 yen → 75,000 yen (0.35% if the capital exceeds approximately 21 million yen)
Limited Liability Company (Gōdō Gaisha): 60,000 yen → 30,000 yen (0.35% if the capital exceeds approximately 8.5 million yen)
Unlimited Partnership Company (Gōmei Gaisha) or Limited Partnership Company (Gōshi Gaisha): 60,000 yen → 30,000 yen

2. Fukuoka City New Startup Promotion Subsidy
For founders who receive a reduction in registration cost from the national Specified Startup Support program (1. above), Fukuoka City will provide support for the remaining cost. For example, for someone establishing a joint-stock company, a flat rate of 75,000 yen will be provided. In the cases of a limited liability, a unlimited partnership, or a limited partnership company, a flat rate of 30,000 yen will be provided.
Founders establishing a joint-stock company who use this system can start a business with the minimum tax amount. Those who establish a limited liability, a unlimited partnership, or a limited partnership company can start a business free of the standard registration fee (the application window is September 25, 2020 – March 31, 2021).

3. Startup-related Guarantee
Generally, when you borrow from a financial institution, you can only receive a guarantee from the Credit Guarantee Association (public institution) two months in advance. With this, you will be able to get it six months in advance.

4. Preferred Treatment from Japan Finance Corporation’s New Start-up Loan Program & New Startup Funds
You can get preferred treatment for your own funding requirements when you start a new business, receive a loan for equipment funds, or receive a loan for working capital under the New Start-up Loan Program. You will also be able to receive a loan at a low interest rate when you start a new business or when you get a loan from the New Startup Fund within seven years of starting the business.
*Note: the Japan Finance Corporation must examine everything mentioned in this section.

5. Employment Subsidy
You can use the national subsidy system if you start a business when you are over 40 years old or when you hire someone over 40.

Opening One-stop Center

 In August 2019, Fukuoka City launched the Fukuoka City Opening One-Stop Center, where founders can complete everything necessary to establish a corporation online. This makes the process simpler, as steps that once required you to be there in person can now be completed online, with help from the One-Stop Center concierge.
We actively assist founders through the online process for many of the steps required to establish and open a corporation. This includes initial consultations, applications for articles of incorporation, registration, tax procedures, health insurance procedures, and pension procedures. If you apply for articles of incorporation online, there is a cost advantage as the online procedure does not require the 40,000 yen stamp duty.

Starting Up in Fukuoka

 The support mentioned above is only the beginning of what we are implementing for international entrepreneurs who start a business in Fukuoka City. If you are interested in starting a business in Fukuoka, please contact the Global Startup Center. We hope that our readers will take advantage of the benefits that come with starting a business in Fukuoka.

*Please note that terms and titles used in the text above may differ in meaning across countries.