Godo Kaisha (GK) is a legal entity similar to a limited liability company created under the 2006 reform. This category of enterprise in Japan is characterized by its ease of management and structure, making it ideal for start-ups and medium-sized businesses.
GK members have limited liability to the extent of their investment and have the ability to directly manage the company without necessarily forming a board of directors. Goshi Kaisha and Gomei Kaisha are traditional forms of partnership:
- Gomei Kaisha is a general partnership in Japan, where all partners have unlimited personal liability for the company’s obligations.
- Goshi Kaisha is a limited partnership in Japan, which includes both general partners with unlimited liability and limited partners with limited liability.
These structures are less popular in modern business practice due to the risks associated with unlimited liability of partners. Foreign organizations also have the option of establishing a branch office in Japan. Such a firm is not an independent legal entity, but is a part of the parent corporation. To establish a branch office in Japan, it is necessary to designate a person responsible for representing the interests of the enterprise and provide an address within the country. Such a structure has the right to carry out trade operations, enter into agreements and receive income within the state. The tax obligations of a branch include taxation of income earned in the country at rates similar to those used for local enterprises.