This article is written by a Japanese local.
When elite professionals currently operating under a Highly Skilled Professional (HSP Type 1-a or 1-b) visa in Japan decide to start a business, the first option they consider is “switching to a Business Manager visa.” However, this simple change in visa status can actually be the biggest landmine, preventing you from obtaining Permanent Residency through the shortest route. This is because the HSP visa holds overwhelming privileges that a standard Business Manager visa does not.
This article outlines objective legal approaches to starting a business without relying on the standard Business Manager visa, allowing you to maintain or upgrade your status as a Highly Skilled Professional.
1. The Risk of a “Downgrade” When Switching to a Business Manager Visa
[Summary] Switching to a Business Manager visa means a fatal downgrade: the severance of the fast-track (1-year/3-year) Permanent Residency route and the immediate loss of privileges to bring parents or domestic helpers.
Many foreigners misunderstand this, but the requirements for Permanent Residency under a standard Business Manager visa are significantly stricter than under the HSP visa. You must logically analyze the following risks.
(1) Severance of the Permanent Residency Route
If you hold 80 points under the HSP visa, you can apply for Permanent Residency just one year after arriving in Japan. However, if you switch to a standard Business Manager visa and cannot objectively prove that you still score 80 points or more under the new status, you risk being pushed back to the general requirement of “10 years of continuous residence.”
(2) Loss of Privileges for Accompanying Family and Maids
Privileges exclusive to the HSP visa, such as bringing your parents or a domestic helper (maid), do not exist under a standard Business Manager visa. The moment you switch visas to start your business, a critical deadlock occurs where the family members living with you may legally be unable to stay in Japan.
2. Legal Approach A: Transitioning to HSP Type 1-c
[Summary] If you intend to start and manage your own business, the legally safest route is to apply for a Change of Status to “HSP Type 1-c (Advanced Business Management Activities),” which maintains your HSP privileges.
When starting and managing your own company, the target should not be the standard “Business Manager Visa,” but rather transitioning to “HSP Type 1-c (Advanced Business Management Activities).” This allows you to operate as an entrepreneur while retaining all the privileges of the Highly Skilled Professional status.
However, transitioning to Type 1-c requires proving your “HSP points (70/80 points)” again, in addition to the standard Business Manager requirements of “30 million JPY in capital and an independent office.” This demands strict financial planning to ensure your points can be maintained solely on the executive compensation paid by your new company.
3. Legal Approach B: “Becoming an Owner” While Maintaining Current Status
[Summary] By maintaining your current work visa and becoming an “investor (owner)” who does not engage in daily operations, you can clear legal regulations by delegating field management to other directors.
If you are an HSP Type 1-b (Technical/Humanities) continuing to work for your current employer while wanting to start a business on the side, you have the option of owning a company (“becoming an owner”) “within the scope of your current activities” without changing your visa.
Under Japanese law, as long as you do not substantially engage in “management” (executing practical operations) outside the scope of your visa, there are no restrictions on becoming a shareholder (owner) of a company or receiving dividend income. This is a compliance management method where you delegate on-the-ground operations and representative director duties to a partner with a proper visa or a Japanese national, allowing you to grow the business as an owner while maintaining your primary job.
4. Legal Approach C: The Royal Route of Waiting for “Permanent Residency”
[Summary] If you wait one year to obtain Permanent Residency before starting your business, the requirements for capital and an independent office vanish, allowing you to operate under the exact same conditions as a Japanese national.
Unless you have a pressing reason to start a business immediately, the ultimate, most highly recommended procedure is to “wait 1 year (or 3 years) to secure Permanent Residency before starting your business.”
The Privilege that Completely Removes Visa Restrictions
Once you become a Permanent Resident, all Immigration Control Act hurdles, such as the “30 million JPY capital” or “independent office space” requirements, disappear completely. You can legally start a business with just one PC at home and 1 JPY in capital. Furthermore, there is no risk of being expelled from Japan even if the business runs at a deficit, and you can secure startup loans from banks under the same conditions as Japanese nationals.
*Note: The Time Lag in Screening
The only concern is the “screening period.” Even if you earn the right to apply in one year, the current Permanent Residency screening by Immigration takes about 10 to 14 months. You must factor into your business plan the time lag that you will actually be able to freely start a business as a Permanent Resident “about 2 years after arriving in Japan.”
Conclusion: A Visa Change Can Lead to a “Time Loss in Life”
In the challenge of entrepreneurship, selecting the wrong visa status can result in an irreversible loss of time. Discard the simple thought process of “Becoming a President = Business Manager Visa,” and draw a roadmap that looks comprehensively at your current point status, financial strength, and the shortest distance to Permanent Residency. To solve this complex legal puzzle and succeed in business in Japan with the optimal status, undergoing a legal check by professionals thoroughly versed in Japan’s Immigration Control Act is strongly recommended.