Why “Proper Business Activity” Matters
In recent policy discussions, including proposals issued by Japan’s ruling party in early 2026, increased attention has been placed on preventing misuse of the Business Manager visa.
These discussions do not target legitimate entrepreneurs.
Rather, they highlight the importance of ensuring that business activities conducted under this visa status are substantive, continuous, and consistent with what was approved at the time of application.
Understanding what immigration authorities generally consider to be “proper business activity” is therefore essential for both new applicants and current visa holders.
What Is Considered a “Paper Company”?
In practice, immigration authorities focus on business substance, not merely formal registration.
A company may raise concerns if it shows characteristics such as:
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The company exists legally but has no ongoing business operations
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No actual services or products are being provided
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The office exists only on paper, with no real working environment
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There is little or no evidence of commercial activity
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Revenue is absent without a reasonable business explanation
These situations are commonly referred to as “paper companies,” even though they may be properly registered under company law.
What Tends to Be Evaluated Positively
Conversely, businesses are generally viewed more favorably when they demonstrate clear operational substance, such as:
(1) Actual Business Operations
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Clearly defined services or products
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Ongoing business activities aligned with the business plan
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Transactions with customers or clients
(2) A Functional Business Base
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A dedicated office appropriate for the business type
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Evidence that business activities are conducted there
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Reasonable office expenses consistent with operations
(3) Financial and Administrative Reality
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Proper bookkeeping and accounting records
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Tax filings consistent with business activity
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Use of a business bank account appropriate for operations
(4) Continuity and Consistency
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Activities that match what was stated in the original application
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Logical development from the original business plan
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Reasonable explanations for changes in direction, if any
No single factor is decisive; immigration authorities typically assess the overall picture.
Business Performance vs. Business Substance
It is important to distinguish between business results and business substance.
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A business does not need to be immediately profitable
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Temporary losses do not automatically indicate misuse
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Start-up phases and market-entry periods are generally understood
What matters is whether the business is genuinely operating and whether its activities are commercially rational.
Points Likely to Receive Greater Attention Going Forward
Based on recent policy discussions and existing practice, future screening may place greater emphasis on:
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Whether the business is more than nominal
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Whether the visa holder is actually engaged in management activities
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Whether business activities align with the approved purpose of stay
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Whether public obligations (tax, insurance, reporting) are properly handled
These are not new requirements, but areas where scrutiny may become more detailed.
Practical Takeaways for Business Manager Visa Holders
For entrepreneurs planning to apply for or renew a Business Manager visa:
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Focus on building real, documentable business activity
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Ensure that daily operations match the approved business scope
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Maintain proper records and compliance from an early stage
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Be prepared to explain your business logically and consistently
Well-prepared and genuinely operating businesses are not the intended targets of misuse-prevention discussions.
Final Note
The Business Manager visa remains a key pathway for foreign entrepreneurs in Japan.
Recent policy proposals reinforce a principle that has long existed in practice: substance matters more than form.
By understanding and applying this principle, entrepreneurs can operate with greater confidence and stability.
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