Japan is considering the relaxation of visa rules for foreign entrepreneurs aiming to launch businesses within the country, as reported by government sources.
The upcoming policy, anticipated to receive approval shortly, will grant foreign entrepreneurs a two-year “Business Management” residency through the Startup Visa program. Notably, this will be achievable without the requirement of securing funds or establishing a physical business location in Japan.
Instead, foreign entrepreneurs will be required to submit a certified business plan and fulfill other conditions to qualify for the residency. Successful business launches may lead to the extension of this residency period.
This initiative is designed to attract a greater influx of foreign talent and innovation to Japan. The country, often perceived as having restrictive and bureaucratic visa policies, seeks to foster a more welcoming environment for international entrepreneurs.
Current Rules Are Too High and Unpopular
Currently, foreign entrepreneurs face stringent prerequisites for securing residency in Japan, including the necessity of having a physical business location, employing two locals, and investing a minimum of 5 million yen ($33,189) in their ventures.
Alternatively, entrepreneurs have the option to apply for a six-month residency through the Startup Visa program, which exempts them from the office and employment requirements. However, this waiver is applicable only if they establish their startups in Tokyo or Fukuoka, the two designated areas for the program.
Despite its existence since 2015, the program has not gained widespread popularity. Local media reports indicate that only 380 applicants have obtained residency through the program as of the end of April 2024.
Japan Hopes To Catch Up With Its Asian Neighbors
Japan hopes to catch up with its Asian neighbors, such as Singapore, Hong Kong, and South Korea, all of which boast more favorable visa policies for foreign entrepreneurs.
For instance, Singapore has implemented Entre Pass, a startup visa that provides foreign applicants with one-year renewable residencies. This is contingent on the applicants showcasing a proven track record of successfully launching startups.
In the case of Hong Kong, a special administrative region of China, candidates are still required to secure funding to qualify for an entrepreneur residency. However, Hong Kong provides a fast-track process and a suite of support services tailored for startups.
On the other hand, South Korea has the Korea Startup Visa program, which lacks financial requirements. Instead, it places emphasis on the innovative aspects of startups to determine the eligibility of candidates.
Despite boasting the world’s fourth-largest economy, Japan has historically been an appealing destination for foreign investors and tourists. Nevertheless, its discerning visa policies may have impeded the full realization of its entrepreneurial ecosystem’s potential.
Japan aspires to enhance its competitiveness and foster innovation in the global market by easing its visa rules for foreign entrepreneurs.