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Selecting the right company type for company registration in Japan is the first step for foreign entrepreneurs planning to enter the Japanese market. Although Japan has four main company types under the Companies Act, Kabushiki Kaisha (KK) and Godo Kaisha (GK) are the preferred Japanese company types.
Choosing the company type for business has implication on your credibility, governance and operational flexibility. Each structure has its own set of rules, benefits, liability and ownership. Learning about these choices will play a big part in your legal structure and long-term business strategy for company formation in Japan.
This blog outlines the differences and similarities between a KK and a GK and helps you make a decision that aligns with your business model and ensures success.
To successfully launch a business in Japan, it is important to understand the country’s business culture and choose the right company type. Today, Japan’s economy is moderately growing, supported by innovation, advanced technology and strong global relationships.
The government of Japan is also encouraging foreign investment, goods and capital and making Japan an attractive destination for international entrepreneurs and startups looking to expand in the Asia-Pacific region.
Entering the Japanese market requires careful planning, particularly when deciding the company type to establish. However, through the Invest Japan initiative, the government has simplified regulations, registration and licensing procedures for foreign companies.
A Kabushiki Kaisha (KK) is a joint stock corporation in Japan. This company type allows public trading of shares. A KK follows the rules set by the Companies Act and is similar to that of an LLC in America. The primary feature of a KK is its ability to issue stocks in the form of shares.
A Godo Kaisha (GK) is a company type in Japan which is a Limited Liability Corporation without stocks. A GK provides limited liability to its owners and has a simplified internal structure. It is an ideal company type for small and medium-sized enterprises as it protects your personal assets.
In Japan, both Godo Kaisha and Kabushiki Kaisha are under the country’s corporate laws. However, the legal requirements and administrative burden are visibly different. The Japanese company type GK is a simpler company structure. It does not have any requirement for a board of directors and has fewer governance obligations.
On the other hand, Kabushiki Kaisha is a more complex company structure that has stringent regulatory requirements. KK also have more upfront costs, requiring notarisation of documents and appointment of directors. In addition to this, the Kabushiki Kaisha also have a robust governance framework.
The key legal and administrative differences in Kabushiki Kaisha (KK) and Godo Kaisha (GK) are as follows:
The similarities between a Kabushiki Kaisha (KK) and a Godo Kaisha (GK) are that both company types operate as separate legal entities. In both structures, the investors have limited liability with financial responsibility restricted to the amount they invest in the company.
A single individual can establish either type of company in Japan, and there are no nationality restrictions for shareholders. The incorporation process for both company types will take 2 to 4 weeks. However, the total setup may take longer, around 1 to 3 months.
Get expert assistance from EnterSlice to choose the right company structure in Japan with complete legal compliance, registration support, and strategic guidance.
The five key differences to consider when comparing a Kabushiki Kaisha (KK) and Godo Kaisha (GK) are as follows:
A Kabushiki Kaisha (KK) is a Japanese company type that has been around for more than a century. Therefore, the customers, employees and business partners see it as a more credible and established structure compared to a GK. However, today, the perception of Godo Kaisha (GK) has improved as it has been around for 15 years. Several leading global companies like Amazon and Apple operate in Japan using the GK structure.
Kabushiki Kaisha (KK) is designed for long-term growth as it allows businesses to appoint a board of directors, issue shares, and raise investment. It also allows listing on a stock exchange in the future. A GK, on the other hand, does not provide the same options for issuing shares or public listing.
In a Kabushiki Kaisha (KK), ownership and management have a clear distinction. Shareholders own the company, while directors manage its operations. In contrast, a Godo Kaisha (GK) has investors who are considered partners. Investors are treated as members or partners who help run the company, and the investment does not always determine the same level of authority.
Setting up and managing a GK is generally more cost-effective compared to a KK. To legally establish a KK, the registration taxes charged by the government are higher compared to a GK (JPY 150,000 for KK and JPY 60,000 for GK). KK also requires formal procedures, which come with additional support costs on an annual basis. Therefore, a Kabushiki Kaisha (KK) is more expensive compared to a Godo Kaisha (GK).
If you are a foreign entrepreneur who fully owns a Godo Kaisha (GK) company, you can access tax advantages. As a foreign entrepreneur, you can elect the GK as a disregarded entity for international tax purposes. This allows the GK to be treated similarly to a branch of an existing foreign company when filing taxes in the home country.
Let us compare the differences between KK and GK company types in Japan:
Examples of the leading international Kabushiki Kaisha (KK) companies in Japan are:
The examples of international Godo Kaisha (GK) companies in Japan are:
The key benefits of incorporating a Kabushiki Kaisha (KK) in Japan are:
The key benefits of establishing a Godo Kaisha in Japan are:
Get expert assistance from EnterSlice to complete your company registration in Japan with full compliance, documentation support, and strategic guidance.
If you wish to launch your business as a Godo Kaisha (GK) and later convert it to Kabushiki Kaisha (KK), you will have to reconstruct your corporate structure. However, the change is not automatic and involves a process which includes formal reconstruction, legal filings and tax updates. It will also include changes in the company’s governance and ownership structure.
Many founders start with a GK because it is quicker to set up and requires fewer formalities. Later, when the business expands or requires investors, they may decide to move to a KK. However, this change will require preparing new Articles of Incorporation, completing notarization and updating official registrations. You may also need to review banking requirements or update existing agreements during the transition.
In some situations, forming a Kabushiki Kaisha from the start may be more practical, particularly for companies planning to raise capital, hire locally or work with large Japanese clients. However, starting as a Godo Kaisha (GK) is still suitable for you if you want to test the market first, provided you have a clear timeline for a possible conversion in the future.
To operate a company in Japan as foreign entrepreneurs, the biggest difference between a KK and a GK is who will operate the company and where they will be based.
A Godo Kaisha (GK) is a Japanese company type that can be established and operated without having a director who resides in Japan. This makes it a flexible choice for foreign entrepreneurs who want to start their business remotely. It is also particularly useful for founders who want to explore the Japanese market before moving to the country.
A Kabushiki Kaisha (KK), however, usually requires at least one director who is a resident of Japan. The person does not have to be a Japanese citizen, but they must have a valid visa and an address in Japan. For foreign companies that don’t have a local partner or representative, this requirement can create an additional step and will require appointing a nominee director or relocating to Japan.
In short, Godo Kaisha (GK) company structure offers greater flexibility during the setup stage, while the Kabushiki Kaisha (KK) may provide advantages if the business plan involves immigration, raising investment or building a larger presence in Japan.
The taxation system for both KK and GK remains similar, as both company structures are taxed at a standard corporate income tax rate under Japanese law. They also have the same tax rules for consumption tax (VAT) and withholding tax, depending on the revenue threshold and business activities.
Although both company types are taxed as corporations, there are only subtle differences. The Godo Kaisha (GK) company type is more flexible in profit distribution with less financial reporting; however, Kabushiki Kaisha (KK) face stricter auditing and stringent reporting requirements.
In 2026, both Kabushiki Kaisha (KK) and Goudou Kaisha (GK) are taxed at a standard rate of
30.64%–31.52%. This is a combined tax rate which includes both national and local taxes for large corporations.
To choose between Kabushiki Kaisha (KK) and Godo Kaisha (GK), entrepreneurs should align the company’s immediate needs with long-term objectives. Below are the guidelines mentioned to help you choose the Japanese company types:
At Enterslice, we have handled over 1000+ legal entity registrations across all industries in Japan. With our guidance, you can understand the difference between Kabushiki Kaisha and Godo Kaisha. Our experts evaluate your operational needs, investment plans and long-term goals to recommend the most suitable company type for you. Through our comprehensive services, your business setup in Japan will be successfully launched.
Both Kabushiki Kaisha and Godo Kaisha offer limited liability and allow companies to operate effectively in Japan. It is the two most commonly used company types, each offering distinct advantages depending on the goals of the business.
While the KK is often preferred by companies that want to build a strong corporate image and attract investors with access to equity financing, a GK provides a simpler structure and is cost-effective; it also offers greater flexibility in management. It is suitable for small-scale startups, joint ventures and subsidiaries.
For startups considering expansion to Japan, choosing the right company type is important. Therefore, as an entrepreneur, you must weigh the short-term cost savings against long-term growth strategies.
If you are considering company formation in Japan and would want to understand which structure best fits your business model, connect with Enterslice for an initial consultation and to help you assess legal and operational implications before company registration.
The Japanese company type Kabushiki Kaisha, commonly abbreviated as KK, is a type of business corporation that is defined under Japanese law. In the official translation by the Japanese government, it is termed as “stock company” or “joint stock company”.
The company type GK, which is Godo Kaisha, is another type of Japanese company structure which is similar to a limited liability company in America. In a GK company type, the members have liability protection and flexibility in ownership and management.
Yes, foreign entrepreneurs who are non-residents can be representative director of a Kabushiki Kaisha or a managing director of the Godo Kaisha. Under Japanese law, there is no nationality requirement; however, you will have to ensure compliance with the separate immigration and visa requirements depending on the situation.
If your business requires credibility, raising capital through shares and easy bank account opening, you can choose KK (Kabushiki Kaisha); however, if you want a cost-effective and faster business setup with operational flexibility, you must choose GK (Godo Kaisha).
The key differences between KK and GK are as follows: Structure: KK can issue shares and has a formal structure, but GK do not issue shares and all the owners are actively involved. Cost: Registration cost for GK is cheaper compared to the cost of KK in Japan. Credibility: In Japan, the KK company type is considered more credible and serious compared to a GK. Compliance: KK will have to conduct annual shareholder meetings, while GK does not have the annual requirement.
To start a Kabushiki Kaisha in Japan, you will first have to choose a company name and register a physical office space. You will also have to prepare essential documents and notarize the articles of incorporation at a notary’s office. Once completed, submit the application with documents to the Japan Legal Affairs Bureau.
To register a Godo Kaisha company structure in Japan, follow the steps below: Determine key details of your company. Create a company seal, including the representative seal. Draft Articles of Incorporation that outline internal rules and the roles of the members. Deposit the initial capital in a personal bank account. File the registration application, certificate of capital deposit and Articles of Incorporation with the Legal Affairs Bureau. Post registration, obtain the Certificate of Registered Matters and Certificate of Registered Seal Register a physical office space in Japan.
To register both Godo Kaisha (GK) and Kabushiki Kaisha (GK) in Japan, it will take between 2 and 4 weeks. However, the entire incorporation time will take around 1 to 3 months. If your application is not complex and the documents are accurate, it can also be done within 24 hours to a few days.
When you choose a company type for your business, it will impact your operations, compliance, and long-term growth potential. The company type will also influence your tax implications and banking. With expert advice, you can choose the right company type that aligns with your business goals and corporate model.
Yes, a Godo Kaisha (GK) is easier and comparatively cheaper to register than a Kabushiki Kaisha (KK) in Japan. It is similar to an LLC in the US and is designed as a low-cost structure, making it ideal for startups, small businesses and foreign subsidiaries. Additionally, it also has simpler formalities, easy registration and maintenance requirements.
Selecting the right company type for company registration in Japan is the first step for foreig...
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