[Blog]Are We Still Welcome in Japan? — The Tightening of the Business Manager Visa and the Balanced Coexistence Model

2026-08-04

Growing Anxiety Among Foreign Entrepreneurs

On August 1, 2026, Bengoshi.com News published an article titled “Are We Still Welcome in Japan?” The Tightening of the Business Manager Visa and the Concerns of the “Father of Little India”. Through an interview with Jagmohan Chandrani, chairman of the Edogawa Indian Association, the article examines how stricter requirements for Japan’s Business Manager residence status are affecting foreign entrepreneurs who operate small businesses in Japan.

Chandrani has long worked to build ties between Japanese residents and the Indian community in Tokyo’s Nishi-Kasai district. The article therefore does not merely discuss immigration rules in the abstract. It shows how regulatory changes are being experienced by people who have lived in Japan for many years, established businesses, paid taxes, employed workers, and formed close relationships with local communities.

The Revised Business Manager Requirements

Japan substantially tightened the standards for the Business Manager residence status in October 2025. Under the revised framework, a corporation is generally expected to have capital of at least JPY 30 million. Additional requirements concerning the employment of full-time staff, the manager’s educational background or business experience, and the availability of personnel with sufficient Japanese-language ability were also introduced.

The stated purpose of these changes is understandable. The government seeks to prevent the establishment of sham companies created primarily to obtain residence status and to improve the credibility and sustainability of businesses operated by foreign nationals. Immigration authorities have a legitimate responsibility to detect false applications, nominal business operations, tax avoidance, and other forms of abuse.

The Impact on Genuine Small Businesses

The central concern raised by the article is that stricter standards may affect not only abusive or fictitious businesses but also genuine small enterprises that have operated lawfully for many years. Indian and Nepali restaurants, retail shops, and other foreign-owned businesses often function with limited capital while continuing to pay rent, wages, taxes, and social insurance contributions.

Many of these businesses are already facing rising import costs, inflation, labor shortages, higher utility expenses, and increasing social insurance burdens. For such businesses, a JPY 30 million capital requirement is not a minor administrative adjustment. It may determine whether the owner can continue operating in Japan at all.

The article notes that only a relatively small proportion of Japanese companies have capital of JPY 30 million or more. This raises a fundamental policy question. Is it reasonable to require foreign entrepreneurs to meet a financial threshold that many Japanese small and medium-sized enterprises themselves do not satisfy?

Why Institutional Anxiety Matters

Individual testimony alone cannot determine the design of immigration policy. Nevertheless, statements such as “We may have to close our business,” “The rules may become even stricter,” or “Are we still welcome in Japan?” reveal a serious decline in institutional confidence.

Entrepreneurs do not make decisions only for the duration of a single residence permit. They sign long-term leases, purchase equipment, hire employees, build relationships with suppliers, enroll their children in schools, and organize family life around the assumption that lawful and sustainable business activity will be fairly evaluated.

When the basic conditions of residence are changed substantially and future renewal becomes difficult to anticipate, uncertainty spreads beyond immigration procedures. It affects business investment, employment, family stability, and relations between foreign residents and the wider community.

Beyond the Choice Between Strictness and Leniency

This issue should not be reduced to a simple choice between accepting foreign entrepreneurs without restriction and excluding them through strict regulation. The existence of fraudulent companies, nominal offices, unpaid taxes, labor law violations, or misuse of residence status justifies effective administrative oversight.

Foreign entrepreneurs, like Japanese business owners, must comply with accounting rules, tax obligations, labor laws, social insurance requirements, licensing regulations, and immigration procedures. The Balanced Coexistence Model does not reject these obligations. Rather, it regards mutual responsibility as an essential condition of coexistence.

However, when a measure designed to eliminate abuse also forces legitimate businesses to withdraw, the relationship between the policy objective and the regulatory method must be reconsidered. The relevant question is not whether the system is strict or lenient, but whether the burden imposed is proportionate to the risk being addressed.

The First Connection to the Balanced Coexistence Model: Predictability

The Balanced Coexistence Model understands institutional trust as a combination of comprehensibility, predictability, and reliability. People must be able to understand what a system expects, anticipate how it will respond, and rely on it when they act in good faith.

Policy changes may sometimes be unavoidable. However, when major requirements are revised, the government should explain the specific problems that prompted the reform, the evidence supporting the new standards, the expected effects, and the impact on existing businesses.

A transition period alone is insufficient. Existing entrepreneurs must also be told what they are expected to improve during that period, how their actual business performance will be assessed, and what factors may compensate for an inability to meet a single numerical threshold. Without such explanations, a transition period merely postpones uncertainty rather than resolving it.

The Second Connection: Evaluating Business Reality, Not Capital Alone

Capital is one indicator of business stability, but it is not identical to business legitimacy or sustainability. A company may have substantial capital but little genuine activity. Conversely, a business with modest capital may have operated continuously for many years, paid taxes, maintained employment, and become an indispensable part of the local economy.

From the perspective of the Balanced Coexistence Model, immigration authorities should evaluate foreign-owned businesses through a combination of indicators. These may include sales, profitability, tax compliance, social insurance enrollment, employment records, years of operation, licensing status, payment history, business plans, and contributions to the surrounding community.

A multi-factor assessment would not weaken immigration control. It would enable authorities to distinguish more accurately between fictitious businesses, unstable businesses, and legitimate enterprises that may be temporarily small but socially and economically viable.

The Third Connection: Combining Obligations with Support

Coexistence does not mean protecting foreign residents from every consequence of non-compliance. Entrepreneurs must fulfill their legal and financial responsibilities. However, a system that imposes obligations should also provide the infrastructure necessary to satisfy them.

Problems are often discovered only when a residence-status renewal application is filed. By that time, unpaid social insurance contributions, incomplete tax procedures, registration inconsistencies, or accounting deficiencies may already have accumulated.

A preventive system would identify these risks earlier. Immigration authorities, tax offices, social insurance agencies, corporate registries, and local governments could provide coordinated notifications and guidance. Entrepreneurs could be informed of deficiencies before they become grounds for refusal and directed toward professional advice, installment payment arrangements, or business improvement plans.

This is not a form of excessive leniency. It is preventive governance. It encourages compliance, reduces administrative surprises, and makes enforcement more effective by addressing problems before they become irreversible.

Diversity as a Result of Institutional Design

The closure of foreign-owned businesses affects more than the business owner. It can affect employees, landlords, suppliers, consumers, commercial districts, and the cultural character of local communities.

Foreign-owned restaurants and shops do not automatically benefit every community, and their continued existence should not be guaranteed regardless of legal compliance. At the same time, their disappearance does not automatically serve Japan’s national interest.

Immigration policy indirectly shapes the future of local economies. Decisions regarding residence status influence what kinds of businesses remain, which neighborhoods retain commercial activity, where employment is created, and whether foreign residents see themselves as temporary outsiders or responsible members of society.

Management and Coexistence Must Be Designed Together

The Balanced Coexistence Model rejects both unconditional acceptance and indiscriminate exclusion. It seeks to balance public safety, legal compliance, economic stability, human dignity, and social continuity through institutions that are transparent and proportionate.

Under this model, the government has the right to demand genuine business activity and responsible conduct. Foreign entrepreneurs, in turn, have the right to understand the standards that apply to them, to receive consistent treatment, and to know whether deficiencies can be corrected.

Management and coexistence are therefore not opposing principles. Effective management can support coexistence when it distinguishes accurately between abuse and legitimate activity. Coexistence can support management when residents understand their responsibilities and are given practical means to fulfill them.

Building a System That Does Not Force People to Ask, “Do We Belong Here?”

The debate over the Business Manager residence status is about more than a capital requirement. It concerns the relationship between institutional power and the expectations of people who have built their lives under that institution.

The question “Are we still welcome in Japan?” should not be answered through emotional approval or rejection. It should be answered through a system that clearly communicates its standards, evaluates actual conduct, recognizes sustained contributions, and provides realistic opportunities for correction.

Administrative authorities should explain the reasons for their decisions and the path toward compliance. Entrepreneurs should demonstrate genuine business activity, legal compliance, and responsibility toward employees and society.

Growing Anxiety Among Foreign Entrepreneurs

On August 1, 2026, Bengoshi.com News published an article titled “Are We Still Welcome in Japan?” The Tightening of the Business Manager Visa and the Concerns of the “Father of Little India”. Through an interview with Jagmohan Chandrani, chairman of the Edogawa Indian Association, the article examines how stricter requirements for Japan’s Business Manager residence status are affecting foreign entrepreneurs who operate small businesses in Japan.

Chandrani has long worked to build ties between Japanese residents and the Indian community in Tokyo’s Nishi-Kasai district. The article therefore does not merely discuss immigration rules in the abstract. It shows how regulatory changes are being experienced by people who have lived in Japan for many years, established businesses, paid taxes, employed workers, and formed close relationships with local communities.

The Revised Business Manager Requirements

Japan substantially tightened the standards for the Business Manager residence status in October 2025. Under the revised framework, a corporation is generally expected to have capital of at least JPY 30 million. Additional requirements concerning the employment of full-time staff, the manager’s educational background or business experience, and the availability of personnel with sufficient Japanese-language ability were also introduced.

The stated purpose of these changes is understandable. The government seeks to prevent the establishment of sham companies created primarily to obtain residence status and to improve the credibility and sustainability of businesses operated by foreign nationals. Immigration authorities have a legitimate responsibility to detect false applications, nominal business operations, tax avoidance, and other forms of abuse.

The Impact on Genuine Small Businesses

The central concern raised by the article is that stricter standards may affect not only abusive or fictitious businesses but also genuine small enterprises that have operated lawfully for many years. Indian and Nepali restaurants, retail shops, and other foreign-owned businesses often function with limited capital while continuing to pay rent, wages, taxes, and social insurance contributions.

Many of these businesses are already facing rising import costs, inflation, labor shortages, higher utility expenses, and increasing social insurance burdens. For such businesses, a JPY 30 million capital requirement is not a minor administrative adjustment. It may determine whether the owner can continue operating in Japan at all.

The article notes that only a relatively small proportion of Japanese companies have capital of JPY 30 million or more. This raises a fundamental policy question. Is it reasonable to require foreign entrepreneurs to meet a financial threshold that many Japanese small and medium-sized enterprises themselves do not satisfy?

Why Institutional Anxiety Matters

Individual testimony alone cannot determine the design of immigration policy. Nevertheless, statements such as “We may have to close our business,” “The rules may become even stricter,” or “Are we still welcome in Japan?” reveal a serious decline in institutional confidence.

Entrepreneurs do not make decisions only for the duration of a single residence permit. They sign long-term leases, purchase equipment, hire employees, build relationships with suppliers, enroll their children in schools, and organize family life around the assumption that lawful and sustainable business activity will be fairly evaluated.

When the basic conditions of residence are changed substantially and future renewal becomes difficult to anticipate, uncertainty spreads beyond immigration procedures. It affects business investment, employment, family stability, and relations between foreign residents and the wider community.

Beyond the Choice Between Strictness and Leniency

This issue should not be reduced to a simple choice between accepting foreign entrepreneurs without restriction and excluding them through strict regulation. The existence of fraudulent companies, nominal offices, unpaid taxes, labor law violations, or misuse of residence status justifies effective administrative oversight.

Foreign entrepreneurs, like Japanese business owners, must comply with accounting rules, tax obligations, labor laws, social insurance requirements, licensing regulations, and immigration procedures. The Balanced Coexistence Model does not reject these obligations. Rather, it regards mutual responsibility as an essential condition of coexistence.

However, when a measure designed to eliminate abuse also forces legitimate businesses to withdraw, the relationship between the policy objective and the regulatory method must be reconsidered. The relevant question is not whether the system is strict or lenient, but whether the burden imposed is proportionate to the risk being addressed.

The First Connection to the Balanced Coexistence Model: Predictability

The Balanced Coexistence Model understands institutional trust as a combination of comprehensibility, predictability, and reliability. People must be able to understand what a system expects, anticipate how it will respond, and rely on it when they act in good faith.

Policy changes may sometimes be unavoidable. However, when major requirements are revised, the government should explain the specific problems that prompted the reform, the evidence supporting the new standards, the expected effects, and the impact on existing businesses.

A transition period alone is insufficient. Existing entrepreneurs must also be told what they are expected to improve during that period, how their actual business performance will be assessed, and what factors may compensate for an inability to meet a single numerical threshold. Without such explanations, a transition period merely postpones uncertainty rather than resolving it.

The Second Connection: Evaluating Business Reality, Not Capital Alone

Capital is one indicator of business stability, but it is not identical to business legitimacy or sustainability. A company may have substantial capital but little genuine activity. Conversely, a business with modest capital may have operated continuously for many years, paid taxes, maintained employment, and become an indispensable part of the local economy.

From the perspective of the Balanced Coexistence Model, immigration authorities should evaluate foreign-owned businesses through a combination of indicators. These may include sales, profitability, tax compliance, social insurance enrollment, employment records, years of operation, licensing status, payment history, business plans, and contributions to the surrounding community.

A multi-factor assessment would not weaken immigration control. It would enable authorities to distinguish more accurately between fictitious businesses, unstable businesses, and legitimate enterprises that may be temporarily small but socially and economically viable.

The Third Connection: Combining Obligations with Support

Coexistence does not mean protecting foreign residents from every consequence of non-compliance. Entrepreneurs must fulfill their legal and financial responsibilities. However, a system that imposes obligations should also provide the infrastructure necessary to satisfy them.

Problems are often discovered only when a residence-status renewal application is filed. By that time, unpaid social insurance contributions, incomplete tax procedures, registration inconsistencies, or accounting deficiencies may already have accumulated.

A preventive system would identify these risks earlier. Immigration authorities, tax offices, social insurance agencies, corporate registries, and local governments could provide coordinated notifications and guidance. Entrepreneurs could be informed of deficiencies before they become grounds for refusal and directed toward professional advice, installment payment arrangements, or business improvement plans.

This is not a form of excessive leniency. It is preventive governance. It encourages compliance, reduces administrative surprises, and makes enforcement more effective by addressing problems before they become irreversible.

Diversity as a Result of Institutional Design

The closure of foreign-owned businesses affects more than the business owner. It can affect employees, landlords, suppliers, consumers, commercial districts, and the cultural character of local communities.

Foreign-owned restaurants and shops do not automatically benefit every community, and their continued existence should not be guaranteed regardless of legal compliance. At the same time, their disappearance does not automatically serve Japan’s national interest.

Immigration policy indirectly shapes the future of local economies. Decisions regarding residence status influence what kinds of businesses remain, which neighborhoods retain commercial activity, where employment is created, and whether foreign residents see themselves as temporary outsiders or responsible members of society.

Management and Coexistence Must Be Designed Together

The Balanced Coexistence Model rejects both unconditional acceptance and indiscriminate exclusion. It seeks to balance public safety, legal compliance, economic stability, human dignity, and social continuity through institutions that are transparent and proportionate.

Under this model, the government has the right to demand genuine business activity and responsible conduct. Foreign entrepreneurs, in turn, have the right to understand the standards that apply to them, to receive consistent treatment, and to know whether deficiencies can be corrected.

Management and coexistence are therefore not opposing principles. Effective management can support coexistence when it distinguishes accurately between abuse and legitimate activity. Coexistence can support management when residents understand their responsibilities and are given practical means to fulfill them.

Building a System That Does Not Force People to Ask, “Do We Belong Here?”

The debate over the Business Manager residence status is about more than a capital requirement. It concerns the relationship between institutional power and the expectations of people who have built their lives under that institution.

The question “Are we still welcome in Japan?” should not be answered through emotional approval or rejection. It should be answered through a system that clearly communicates its standards, evaluates actual conduct, recognizes sustained contributions, and provides realistic opportunities for correction.

Administrative authorities should explain the reasons for their decisions and the path toward compliance. Entrepreneurs should demonstrate genuine business activity, legal compliance, and responsibility toward employees and society. Institutional trust develops through this repeated exchange of explanation, obligation, and fair evaluation.

A system capable of preventing abuse without destroying legitimate businesses would protect both immigration administration and local economic vitality. That is the point at which the concerns described in the Bengoshi.com News article connect directly with the Balanced Coexistence Model.