A GK is owned by its members, who have limited liability, and in principle every member also runs the business. The articles can instead name certain members as executive members and one as the representative member. Where a member is itself a company, such as a foreign parent, it must appoint an individual to carry out its duties. Confusingly for English readers, the legal word for a GK member is shain, the same word Japanese use for an employee.
The appeal is simplicity. There is no shareholders' meeting, no board, no statutory auditor, no fixed term for those running it and no duty to publish a balance sheet. Profits can be distributed in proportions that do not follow capital. Incorporation is cheaper and faster than for a kabushiki kaisha: registration tax is 0.7% of capital with a minimum of 60,000 yen, against 150,000 yen for a KK, and the articles need no notary. A GK cannot list its shares, but it can convert to a KK later.
Several large foreign groups run their main Japanese business through a GK, including Amazon Japan G.K., Apple Japan G.K. and Google G.K.. For US groups the form has a tax advantage: under the US entity classification rules a kabushiki kaisha is always treated as a corporation, while a GK is an eligible entity that can elect, under the check-the-box regulations, to be treated as a partnership or disregarded entity for US tax purposes. In Japan it is still taxed as a corporation. Domestic use has grown fast too, mostly among small businesses and holding vehicles: GKs made up 28.6% of new corporations in 2025, according to Tokyo Shoko Research.
What it means for a foreign employer
- There are no directors. A GK has no torishimariyaku, so it cannot offer a board seat or the title of representative director. The person running it is legally the representative member or that member's appointed individual, and the business card will say something like president or country manager.
- Some candidates read it as small. Senior Japanese candidates who know GKs mainly as start-up or family vehicles may ask why you chose one. A short explanation, pointing to large multinationals that use the form, usually settles it.
- Employment law is unchanged. Dismissal rules, social insurance, work rules and the 36 Agreement apply in full.
- Choose the form before you hire the leader. Converting later is possible but involves creditor procedures and registration, and changes the title you can offer.
Sources
- Companies Act, Articles 575, 576, 590, 598, 599 and 746.
- Registration and Licence Tax Act, Schedule 1 (0.7% of capital, minimum 60,000 yen).
- US Treasury Regulations, sections 301.7701-2(b)(8) (per se corporations, including the Japanese kabushiki kaisha) and 301.7701-3 (classification elections).
- National Tax Agency corporate number register (gBizINFO): Amazon Japan G.K., Apple Japan G.K. and Google G.K.
- Tokyo Shoko Research, godo kaisha incorporations in 2025 (2026).