How Is Domestic Business Substance Evaluated for Cross-Border E-Commerce Companies Applying for a Business Manager Visa in Japan?

This article is written by a Japanese local.

An increasing number of foreign entrepreneurs are establishing corporations in Japan to obtain or renew a “Business Manager” visa through “Cross-Border E-Commerce” businesses, exporting and selling high-quality Japanese products (cosmetics, anime merchandise, pre-owned luxury goods, traditional crafts, daily necessities, etc.) via global marketplaces (Amazon, Shopee, Lazada, eBay, Shopify, etc.).

However, the most severe structural obstacle cross-border E-commerce businesses face in visa screenings is the questioning by immigration officers: “Since your customers and market are entirely overseas, why is it necessary to establish a company in Japan and reside here to conduct management and administration? (Substance of domestic operations and base necessity).”

If operated under vague structures such as dropshipping directly from a home computer overseas without physical presence, immigration officers will judge that “there is no physical base or substance of conducting business in Japan (a paper company)” and that “the operation can be managed from abroad, making stay in Japan unnecessary,” resulting in unsparing rejections.

To conclude, even for cross-border E-commerce businesses, obtaining and renewing a Business Manager visa is fully achievable if you present physical proof of domestic procurement channels, physical stock storage, inspection/packing/shipping lines, independent office space, and the commercial necessity of a Japanese presence.

This article details the evaluation standards applied by immigration for cross-border E-commerce businesses, four key requirements to satisfy screening officers, and practical measures to prevent visa refusals.

1. Why Is Domestic Business Substance Questioned Severely for Cross-Border E-Commerce?

Under examinations for the Immigration Control and Refugee Recognition Act, acquiring a Business Manager visa requires an independent office in Japan where actual business operations occur as an absolute prerequisite.

For cross-border E-commerce where end-users reside entirely outside Japan, screening officers remain highly cautious regarding the following risks:

Screening Focus for Cross-Border EC	Immigration Concerns	Primary Causes of Refusal or Delays
① Necessity of a Japanese Base	Doubts on whether the operation can be managed remotely from the home country.	Failing to logically articulate clear merits and necessity of a Japanese entity in the business plan.
② Logistics & Stock Substance	Concerns that pure dropshipping involves zero merchandise passing through Japan.	Lacking warehouses, contracts, or photos proving domestic procurement and shipping flows.
③ Cash Flow & Tax Transparency	Opaque revenue payout accounts from overseas platforms or consumption tax refund filings.	Failing to formalize corporate accounts or proper consumption tax processing for domestic purchases.

2. Four Key Requirements to Prove “Domestic Business Substance” in Cross-Border E-Commerce

To convince screening officers that genuine executive activities occur within Japan despite targeting overseas markets, present the following four elements as physical evidence:

Requirement ①: Proof of Domestic Procurement Channels (Manufacturer & Wholesale Contracts)

Substantiate contractual relationships for purchasing genuine products directly from Japanese manufacturers, distributors, wholesalers, or secondhand auction markets. Articulate the logic that direct in-person negotiation, purchasing, and contracting as a Japanese corporate entity are indispensable for securing authentic Japanese goods.

Requirement ②: Proof of Physical “Stock Storage (Warehouse)” and Shipping Lines

Present physical spaces (warehouse space within your office or third-party logistics agreements) used to inspect, pack, and export goods via EMS, DHL, FedEx, etc. Submitting warehouse lease agreements, storage photos, and shipping invoices proves that merchandise physically passes through Japan for export.

Requirement ③: Securing an “Independent Office” Separated from Residential Living Spaces

Packing and shipping goods in a home living room fails Business Manager visa criteria. You must secure an independent office and provide comprehensive photos showing workstations, computers, communication infrastructure, company signage, storage shelving, and packing stations.

Requirement ④: Corporate Bank Accounts for Payouts and Proper Tax Filings (Consumption Tax Refunds)

Ensure payout mechanisms from overseas platforms like Amazon or Shopify flow directly into **Japanese corporate bank accounts**. Furthermore, presenting financial statements and tax filings showing proper handling of export tax exemptions (consumption tax refund filings on domestic purchases) highlights corporate transparency and continuity.

3. Pitfalls and Practical Defenses in Visa Applications for Cross-Border E-Commerce

In practice, typical pitfalls during Business Manager visa applications for cross-border E-commerce and their corresponding defenses are as follows:

Pitfall ①: Operating Without a “Secondhand Dealer License” when Handling Pre-Owned Goods

If purchasing pre-owned items (anime merchandise, luxury items, cameras, etc.) within Japan for export, you must obtain a **Corporate Secondhand Dealer License (Kobutsu-sho)** from the Prefectural Public Safety Commission under your company’s name. Applying without required statutory permits results in an immediate refusal for legal non-compliance.

Pitfall ②: The Founder Appears to Be a “Mere Packing/Shipping Laborer”

If the founder spends every day packing cardboard boxes, immigration will judge that “this constitutes manual labor/work visa domain rather than management.” You must outsource packing and shipping to part-timers or 3PL providers, demonstrating an executive framework where the founder focuses on marketing, supplier negotiations, cash flow management, and corporate leadership.

4. Q&A Regarding Cross-Border E-Commerce and Business Manager Visas

Q1. Is it impossible to obtain a Business Manager visa with pure dropshipping?

A. Extremely difficult, with very high refusal risks.
Because dropshipping involves no physical stock or domestic warehouse, immigration easily concludes that “there is no physical business base in Japan.” Even if incorporating dropshipping elements, you must clearly prove physical operations—such as handling partial inventory, conducting quality inspections in your Japanese office, or holding direct distributor contracts with Japanese manufacturers.

Q2. How should I prove revenue when using overseas payment processors (Stripe, PayPal, etc.)?

A. Match the sales dashboard from your corporate processor account with final deposits in your Japanese corporate bank statement.
Operating under personal processor accounts leads immigration to categorize earnings as “personal income.” Transition accounts to corporate entity names and link them to corporate bank accounts immediately.

5. Conclusion: Demonstrate Physical Operations of Purchasing, Shipping, and Managing within Japan

Concluding the acquisition and renewal of a Business Manager visa for cross-border E-commerce: “① You must present domestic procurement contracts and physical warehouse/shipping lines in Japan rather than relying solely on online listings; ② obtaining statutory licenses like the Secondhand Dealer License and receiving payouts via corporate bank accounts are mandatory prerequisites; ③ outsourcing manual packing work to focus on executive marketing and organizational management represents the decisive legal approach to prevent refusals.”