Establishment of a #Stock Company (3) #Company purposes
The purpose of a company refers to the scope of its business activities. It is registered in the Commercial Register, allowing business partners to understand the company’s operations by reviewing the registered purpose.
Therefore, the purpose of a company must be specific and clearly defined. As a profit-making entity, the company’s purpose must be profitable. For example, “donating to others” lacks profitability and cannot be the purpose of a company. Additionally, the purpose must be legal.
As long as the aforementioned rules are followed, the company can freely define its purpose. Even if an activity is not currently being conducted as a business, it can be included in the purpose if there is a possibility of conducting it in the future.
If a permit is needed from the authorities to conduct a business, the purpose of the business should be expressed appropriately to obtain the permit.
Foreign companies establishing companies in Japan must file a prior notification or a post-facto report with the authorities under the Foreign Exchange and Foreign Trade Act. The type of filing (prior notification or post-facto report) depends on the purpose of the business. If a prior notification is needed, it can significantly affect the schedule for establishing the company.