Dormant Companies and Deemed Dissolution in Japan: Risks and Remedies

A kabushiki kaisha (KK, 株式会社) that has made no registration for 12 years since its last one is treated as a dormant company (休眠会社). Unless it files a notification that it has not yet discontinued its business, or makes some registration, within two months of the Minister of Justice’s public notice in the Official Gazette (官報), it is deemed to have been dissolved (みなし解散). For FY2026, the public notice was issued on 15 October 2026, and the deadline is 15 December.

What a dormant company is: who is subject to deemed dissolution

The Companies Act provides a mechanism for clearing out KKs that have made no registrations for a long time. The Ministry of Justice carries out this clean-up of dormant companies and dormant general incorporated entities every year.

The test is the time elapsed since the company last made any registration. Whether it is actually trading is irrelevant. Even a company that is still operating is covered if it has made no registration for 12 years.

Why 12 years

The term of office of a KK director is, as a rule, two years. Even in a company that restricts share transfers, the articles of incorporation can extend it to a maximum of 10 years. The term of a statutory auditor is likewise capped at 10 years. Even when the same officers continue, a reappointment must be registered each time a term ends. A company that has made no registration for 12 years is therefore highly likely to have neglected registering changes of officers.

How to check whether your company is covered

The date of the last registration can be checked in the certificate of registered matters (登記事項証明書), which shows the registration date for each registered item. It can be requested at a Legal Affairs Bureau (法務局) counter or online. In the officers section, check the date on which the last appointment or reappointment was registered, and calculate when the next term expires.

Why Japanese subsidiaries of foreign companies tend to become dormant

• The representative at incorporation has returned home, and no one in Japan receives communications
• Officers’ terms were set at the maximum of 10 years, and their expiry goes unnoticed
• The business has moved back to the home country, but the company remains
• The lease on the office used as the head office has ended, and mail no longer arrives

In each case, the cause is time passing while the parent company’s staff are unaware of how Japanese registration works.

The clean-up process and the FY2026 schedule

How to file the notification

Fill in the notification form attached to the notice sent by the registry office and mail it or bring it to the registry office. How to file if you do not have the notice is also explained in the Ministry of Justice guidance. If you apply to register a change of officers or other matter within the deadline, the dissolution will not be registered even without a notification.

Even after filing a notification, the company will be covered by the clean-up again the following year unless the required registrations are made. Treat the notification as a temporary measure only, and complete the registration of the change of officers or other matters.

The process continues even if the notice does not arrive

The notice is sent to the registered head office address. Companies that have moved their head office without registering the change, or whose head office is unstaffed because an overseas parent manages them, may not notice it. Even so, once two months have passed since the public notice in the Official Gazette, the company is deemed dissolved.

What to do before the FY2026 deadline

1. Obtain a certificate of registered matters and check the date of the last registration and the officers’ terms
2. Check the mail at the head office address for a notice from the registry office
3. For officers whose terms have expired, appoint them at a shareholders’ meeting and obtain their acceptance of office
4. Apply to register the change of officers by 15 December 2026
5. If the registration cannot be completed in time, file a notification that the business has not yet been discontinued by the deadline
6. Also check whether any other changes, such as a head office relocation, have not been registered

Obtaining signature certificates for officers living overseas and translating documents takes time. Start preparing as soon as you become aware of the public notice, not just before the deadline.

Risks of leaving a Japanese company dormant

• Deemed dissolution: after dissolution, the company can act only within the scope of liquidation and can no longer enter into new transactions.
• Non-penal fines: if registration of a change of officers or other matter is neglected, the representative may be subject to a non-penal fine (過料) of up to ¥1 million. Filing a notification or registration later does not erase the fact that registration was neglected.
• Tax: even without business activity, the obligation to file returns generally continues as long as the company exists. The per-capita levy of local tax may also apply. If returns are not filed on time for two consecutive fiscal years, approval for blue-form returns may be revoked.
• Status of residence: if you manage the company under a Business Manager status of residence (在留資格), an inactive company will affect the renewal review. For details, see Business Manager visa renewal.
• Credibility: if business partners or financial institutions see a dissolution entry when checking the certificate of registered matters, the company loses credibility.
• Bank accounts: banks may restrict corporate accounts that have been inactive for a long time or ask for confirmation.
• Effort to restart: gathering documents from shareholders and officers living overseas takes time.

Continuing the company after deemed dissolution

Within three years of the date on which it was deemed dissolved, the company can be continued.

1. Resolve to continue the company by a special resolution of the shareholders’ meeting
2. Because directors lose their positions upon dissolution, appoint new directors and other officers
3. Apply to the Legal Affairs Bureau with jurisdiction over the head office to register the continuation and the officers

The main supporting documents are the minutes of the shareholders’ meeting, a shareholder list showing shareholders’ names and shareholdings, and officers’ acceptances of office. Officers living overseas may use a signature certificate issued by a notary or similar in their home country instead of a seal certificate. Attach translations to documents in foreign languages.

Apply to register the continuation within two weeks of the resolution. If past registrations were neglected, a notice of a non-penal fine may arrive separately from the continuation procedure.

After three years, the company can no longer be continued. In that case, liquidation proceedings must be carried out to extinguish the company.

Note that while the registrar registers the deemed dissolution ex officio, the company itself must apply to register its liquidators. As a rule, the directors at the time of dissolution become the liquidators.

Winding up instead of continuing

If you have no plans to resume business in Japan, register the liquidators, publish a notice to creditors in the Official Gazette, register the completion of liquidation and so on to close the company. The notice period must be at least two months. The procedure is explained in detail in Dissolving and liquidating a Japanese company: procedure and timeline.

Decisions to make before letting a Japanese company go dormant

If you keep the company, maintain a list of officers’ term expiry dates, filing deadlines and the person responsible for the head office address. Filings required after incorporation can be checked in Filings and deadlines after incorporation.

The status of the Japanese company also affects the parent’s consolidated accounts and explanations to the tax authorities at home. We recommend deciding early whether to keep it dormant or liquidate it, taking the home country’s circumstances into account.

How TIMOA can help

Deemed dissolution of dormant companies is decided by whether registrations have been made, not by the substance of the business. The FY2026 deadline is 15 December 2026. The fundamental solution is not merely to file a notification but to complete the registration of officer changes and other matters.

Together with partner judicial scriveners and certified tax accountants, TIMOA supports you in Chinese and Japanese with checking your registration status, registering changes of officers or continuation of the company, filing returns while operations are suspended, and liquidation procedures. We also help prepare documents for shareholders and officers overseas. For details, see our M&A, Succession & Exit page.