Japan's Costly New Business Visa Prices Out Real Entrepreneurs

(MENAFN- Asia Times) Under Japan's newly tightened business immigration rules, that“try first, grow later” logic is increasingly out of place.

The minimum capital for Japan's Business Manager visa (経営・管理 ) was raised from five million yen (about US$32,000) to 30 million yen (about $190,000), alongside added scrutiny around staffing, Japanese language ability, career or educational background and business plan review.

The Business Manager status of residence is designed for foreign nationals who establish and operate a business in Japan, not passive investors.

In 2024, the number of Business Manager visa holders more than doubled to 41,600, up significantly from 18,100 in 2015. Securing this status has long been one of the main legal routes for entrepreneurs seeking to live in Japan while running a company.

Supporters of the revised visa argue the changes are“not exclusionary,” but rather a quality filter aimed at reducing misuse and ensuring applicants have the operational capacity to run a real business.

Reports indicate one factor prompting officials to revise the policy was the growing number of shell companies and cases of visa abuse, though the Immigration Services Agency has not released public data on fraud cases.

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The core problem is that capital is being used as a proxy for legitimacy, cutting out potential small, community-scale business owners who often provide local jobs and neighborhood services. Such investments are crucial to regional development, yet they may be rejected outright based on the new capital requirement.

For perspective, only about 4% of current Business Manager-linked companies reportedly have capital above 30 million yen.

The new process also imposes extra time and setup costs. Under earlier guidance, applicants were advised to budget at least one month for preparation and revisions and at least three months for immigration processing.

Layering on stricter business plan verification and additional evidentiary requirements is likely to lengthen the timeline, which matters as the cost of waiting can be prohibitive for small business founders with limited runway.

Professionals that, excluding the capital requirement, establishing a company and obtaining a visa will now cost approximately 800,000 yen (about $5,100) or more.

While this policy change may discourage low-substance applications, it also risks filtering out legitimate small operators, raising the question of whether enforcement could be achieved through targeted compliance checks rather than a uniformly higher capital bar.

Stricter stances for acceptable office arrangements also mean shell-style setups, such as listing a residence as an office, are less likely to be accepted. This raises fixed costs for small business founders.

Taken together, these changes may be“not exclusionary” in intent but exclusionary in effect. In the coming years, particularly with a more conservative and nationalistic prime minister, Japan is likely to no longer be a home base but a later-stage market for small operators and founders.

Japan does have a startup visa intended to bridge founders toward Business Manager status, but it involves a multilayered review by local governments and immigration authorities and offers only a short runway that still requires meeting Business Manager conditions within a limited window.

For small businesses pushed out by Japan's new rules, Hong Kong is often the more attractive alternative. Unlike Japan's one-size-fits-all capital hurdle, Hong Kong's entrepreneur route allows asset-light models to demonstrate credibility through business logic and operational readiness.

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Official guidance emphasizes business plans, market analysis and overall feasibility rather than a single minimum fixed investment figure. Although applicants must show sufficient funds to support operations, there is no minimum capital requirement set by Hong Kong authorities.

For founders in tech services and cross-border e-commerce, Singapore offers a different appeal. Its EntrePass framework places greater weight on verifiable capability, scalability and intellectual property than on paying a large capital sum upfront, though it does not apply to traditional small businesses such as cafes.

Taken together, Hong Kong and Singapore are well positioned to become first-choice destinations for the small, high-growth firms repelled by Japan's tightened Business Manager visa regime.

In the end, the new policy will divert the very entrepreneurs Japan often says it wants: founders who start small, embed locally and scale responsibly. When the first step costs the equivalent of a house down payment, many will decide their first serious step should be made somewhere else.

Hao Fu is IAR fellow, Center of Japanese Research, University of British Columbia

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