Opportunities for investment in Japan under RCEP framework

Despite the impact of the epidemic, Chinese enterprises' foreign investment will continue to grow in 2021. Among them, the new opportunities for Chinese enterprises to invest in Japan under the framework of RCEP have also attracted the attention of the industry, and the industry insiders from Guangdong have made a detailed analysis on this.

"Branches similar to Chinese branches can be opened in Japan without independent Japanese legal personality. When setting up a branch in Japan, you need to go to the local legal bureau to complete the registration. After the registration, you will receive the transcript of the register, and then you can open a bank account in the name of the branch. Two points should be paid attention to when opening branches in Japan: first, the representatives of branches can be foreigners or Japanese. If they are Japanese, they must have a residence in Japan; Second, after the drafting of the affidavit, you must go to the notary center of your country or the Japanese embassy or consulate for notarization, but the notarization of your country is recognized by the Legal Affairs Bureau. " At the "special activity for Guangdong enterprises to expand legal services for Japan ROK cooperation under RCEP" jointly organized by Guangdong Provincial Department of Commerce and Guangdong Provincial Department of justice, Li Ling, a lawyer of Guangdong Guangxin Junda (Shenzhen) law firm, introduced the detailed rules and precautions for opening a branch in Japan.

"Enterprises can also pay more attention to the changes of investment rules in Japan. Under the framework of RCEP, the investment threshold in Japan has been substantially reduced and the investment convenience has been improved." Chen Weixiong, partner of Guangdong Guangxin Junda law firm, said that the new ways of investing in Japan include setting up business offices and joint-stock companies. Among them, the business office does not have independent legal personality, and the creditor's rights and debts arising from the activities of the business office shall be borne by the foreign company that established the institution. The joint stock company is established by the way that the investors pay cash or deliver property, and only undertakes the obligation of capital contribution for its shares.

However, Japanese laws, including foreign exchange regulations, stipulate certain reporting obligations for newly established enterprises. Chen Weixiong introduced that, specifically, this is divided into two categories: prior declaration and subsequent report. Specific industries with investment related to national security and public order need to be declared in advance, while the acquisition of company equity, the establishment of Japanese branch and the substantive change of the type or business scope of Japanese branch need to be declared afterwards“ Therefore, it is suggested that before investing in Japan, enterprises should judge the type of business they operate, whether they need to perform the pre declaration procedures and post declaration procedures, and clarify the investment structure, such as equity structure and investment schedule. " Chen Weixiong said.

Some Chinese enterprises will choose to acquire Japanese enterprises. Chen Weixiong observed that there are many ways to acquire Japanese enterprises, including acquiring the shares of the target company, accepting the business transfer of the target company and the reorganization stipulated in the Japanese company law. When implementing M & A, Chen Weixiong suggested that Chinese enterprises should fulfill the requirements of financial and securities market regulations, complete the procedures of tender offer, fulfill the obligation to submit a large number of shareholding reports, avoid violating relevant laws such as antitrust and unfair competition, and abide by relevant laws and regulations on data flow in Japan (such as personal intelligence protection law). In order to ensure the smooth completion of the above matters, Chen Weixiong reminded Chinese enterprises to conduct due diligence during M & A, entrusted professionals to find out the situation of the target company, and ensured the right to terminate the contract in case of major changes in the shareholder structure.

Source: China Trade News