Sabadell International Business
Exporting to Japan
Opportunities for Spanish companies in Japan
- The world’s third-largest economy.
- Large market for consumer goods, in which quality is more important than price.
- Exporter of electronics and high- technology. Major promoter of R&D exchange.
- Receiver of quality foreign investment, mainly in new technologies and renewable energies.
- Japan has been investing in Spain constantly for many years.
- Stable, well-developed and reliable legal system, and an open, liberal and sound economic and financial system
- Marked nationalism in consumption patterns: local products are considered better quality than foreign products.
- Rather inflexible in decision- making which sometimes leads to things taking too long.
- Consumer goods, agro-food products, fashion, footwear.
- Building materials.
- Automobile components.
- Chemical and pharmaceutical sector.
- Tourism and leisure.
- Renewable energies.
- Slowly but surely expanding.
- Japan has taken a position as world leader in certain electronic consumer goods.
- The major Japanese banks are again taking positions on emerging markets to prevent Chinese banks from becoming too important.
- South Korea and China are seen as a threat due to territorial tensions with China and the economic emergence of South Korea.
Banco Sabadell in Japan
Banco Sabadell covers Japan from its office in Shanghai, which was established in 2005. It has correspondent bank relations with all Japanese banks, with which it maintains excellent relations. Banco Sabadell in Japan is recognised as a reference bank with respect to the management of international business associated with trade in Japan. Through frequent visits to Japan, these relationships with its correspondent banks in Japan have been strengthened.
Banco Sabadell in Japan has financing lines granted to Japanese banks for projects in the medium and long term. Japanese banks have likewise granted extensive facilities to Banco Sabadell for the development of foreign trade operations, to offer international cover through guarantees for the local operations of its customers.
- Advice on the establishment of Spanish companies in Japan, providing a specialised and individualised service.
- Monitoring of import or export transactions with Japan through the relationships developed with local banks.
- Support for projects and tenders by issuing references and guarantees issued to local banks.
Business structure in Japan
Incorporating a foreign business
Representative Office / Liaison Office
Has no legal personality and capacity of its own. Its activities are on account of the parent company and are limited to collecting and processing information, exploration and promotion activities.
In practice, this has ended up only associated with financial organisations. Branches in Japan have no legal status nor capital of their own. Their capacity for contracting, management and accounting and tax obligations are the direct responsibility of the parent company.
Mercantile Company (Subsidiary)
Public Limited Company or Limited Liability Company. Governed by the Companies Act and the Code of Commerce. The company capital of both may be from 1 yen and there must be one ore more partners
Mixed Company or Joint venture
Foreign companies are not obliged to have a local partner. Incorporating a mixed company or joint venture will be justified when the partner provides contacts, mercantile and financial relations from the country.
The creation of joint ventures is not advisable when little is known about the local partner or when the interests of the two parties do not absolutely coincide.
Incorporating a company in Japan
Companies in Japan are governed by the Companies Act and by the Code of Commerce. They are registered in the Companies Register.
Means of payment in Japan
Exports to Japan
- Documentary credit:
collection prior to shipping the goods. Option of financing for the Japanese payer (importer). It is advisable to work with LCs in transactions carried out in Japan for the first time.
collection management of commercial documents with the purchaser by a bank in Japan, usually with sight bill of exchange or payment.
- Guarantees for advance payment:
performance bonds, and also for regular transactions or for capital goods.
non-recourse discount of promissory note or export L/C
Imports from Japan
- Documentary credit:
a bank promise to pay on condition that documents accrediting the export. are submitted.
- Documentary remittance:
collection management of payment for commercial documents with the purchaser by the Spanish bank.
- Simple transfer:
common payment and collection method.
International negotiation protocol in Japan
- Conservative protocols, values and rules of conduct which must be respected still endure.
- Professionalism in business means that it is a reliable country, although still with some difficulties due to its particular idiosyncrasies. If ones says no this may be interpreted as a lack of flexibility or a lack of interest.
- It is vital to identify the people with decision-making power at companies.
- Japanese SMEs are marked family nature.
- The Japanese are very proud of their country, their political system and their history. It is advisable to avoid references to a past in which there may be a difference of opinions.