You want to get Japan’s green card by the real estate investment ? : Here is what you practically should do

Here is an idea worth considering. Imagine being able to get Japan’s new green card only in a year.
Japan needs more skilled foreign workers.
To attract more foreign workers, Japanese government relaxed requirements for permanent residency (so-called green card) last April (2018)
Before relaxing the requirement, high skilled professional (HSP) workers had to stay in Japan for at least five years before applying for green card, but now just one year is required.
In fact, it is the fastest green card system in the developed countries.
Some pundits are saying relaxed law will bring more foreign high skilled workers but whether it will be a game-changer remains to be seen.
Japan is also said to be a tough country for foreign workers to live due to the very unique traditions such as corporate culture and seniority system, which is another hurdle to clear even after obtaining the green card.
In 2012, Japan introduced a point system for skilled workers. The points are given based on individual backgrounds, including business experience, income, Japanese-language fluency and academic degrees. The system is intended to give preferential status to such skilled workers, including a shortened path for permanent residency.  When the system was enacted, those who had 70 points or more could apply for green card after five years. Normally, it takes 10 years to apply for the status.

With last year’s deregulation, the minimum stay has been lowered to three years for those with 70 to 79 points and one year for those with 80 or more points.

Here are some more details of the concept of the High Skilled Professionals (HSP)

1. Overview and purpose of the system

In order to promote entry of highly-skilled foreign professionals(HSP), a points-based system that provides highly-skilled foreign professionals with preferential immigration treatment was introduced in 2012.

The activities of the highly-skilled foreign professionals are classified into three categories: “advanced academic research activities,” “advanced specialized/technical activities,” and “advanced business management activities.”
According to characteristic features of each category of the activities, points are set to each item, such as “academic background,” “professional career,” “annual salary,” and the like. If the total points reach a certain number (70 points), preferential immigration treatment (for green card application) will be granted to the relevant person, with the aim of promoting the acceptance of highly-skilled foreign professionals in Japan.

2. Concept of “Highly-Skilled Foreign Professionals” (HSP)

Who are the highly-skilled professionals that Japan should actively accept ?
The government sets the definition of 
High Skilled Professionals :

“The quality, unsubstitutable human resources who have a complementary relationship with domestic capital and labor”,

“the human resources who are expected to bring innovation to the Japanese industries, to promote development of specialized/technical labor markets through friendly competition with Japanese people and to increase efficiency of the Japanese labor markets”

Preferential immigration treatment

In addition to the shortening the path to the green card application, Japanese government last year introduced the following preferential immigration treatment which is granted to foreign nationals recognized as High Skilled foreign professionals (HSP) when applying for the green card.

・Permission for multiple purposes of activities
・Grant of the “5 years” period of stay
・Relaxation of requirements for grant of the permission for permanent residence
・Preferential processing of entry and residence procedures
・Permission for the spouse of highly-skilled foreign professional to work in Japan
・Permission for bringing the parent(s) to accompany the highly-skilled foreign
professional to Japan
・Permission for a domestic worker to accompany the highly-skilled foreign
professional to Japan.

The 80-point mark isn’t necessarily a high hurdle. Foreign employees working for major firms or entrepreneurs who start the new business ventures with reasonable capital should have a good shot at reaching the level of 70 to 80 points

Here is the official announcement for the guideline of permission by Immigration Bureau of Japan, the Ministry of Justice. 

The person has a total score of 70 points or more based on the points calculation criteria prescribed in the Ordinance to Provide for the Criteria in the Right-Hand Column Corresponding to “Highly-Skilled Professionals as Specified in Appended Table I(2) of the Immigration Control and Refugee Recognition Act” (hereinafter referred to as “Ordinance of the Ministry of Justice”), and comes under one of the following. a. The person who has continuously stayed in Japan as a “Highly-Skilled foreign Professional” for 3 years or more. b. The person who has continuously stayed in Japan for 3 years or more, and who is deemed to have a total of 70 points or more when calculating with reference to the situation at 3 years before the date of the application for permission for permanent residence.

The person has a total score of 80 points or more based on the points calculation criteria prescribed in the “Ordinance of the Ministry of Justice”, and comes under one of the following. a. The person who has continuously stayed in Japan as a “Highly-Skilled foreign Professional” for 1 year or more. b. The person who has continuously stayed in Japan for 1 year or more, and who is deemed to have a total of 80 points or more when calculating with reference to the situation at 1 year before the date of the application for permission for permanent residence.

OK but what specifically type of people are we talking about in terms of HSP ?

Here is the strategy we recommend for those who want to obtain
the green card in the business fields rather than academic fields.

As I described earlier, there are three categories in HSP.

a) Advanced academic research activities

Official definition:

Activities of engaging in research, research guidance or education based on a contract entered into with a public or private organization in Japan. This category is mainly for academic professors who work for the Japanese government or private organizations.

b) Advanced specialized/technical activities

Official definition:

Activities of engaging in work requiring specialized knowledge or skills in the field of natural sciences or humanities based on a contract entered into with a public or private organization in Japan.

This category is mainly for the professional engineers and researchers.

c) Advanced business management activities

Official definition:
Activities of engaging in the operation or management of a public or private organization in Japan.
This category has effectively two subsets. One is mainly for a professional who works for the major firms and another subset is ‘Advanced business management’ status. The second one is mainly for entrepreneurs who start the new business in Japan.
We believe this ‘Advanced business management’  category is very helpful for the global real estate investors who wish to obtain the green card.

Here is why

Easy to set up a company                                                                                                                             

The visa is for entrepreneurs but it is not easy to start the new business and successful in any country but if you establish your own entity and invest in the real estate through your entity, you ownership clears the minimum criteria to become an ‘advance business management’ person. 

Side business              
You can invest in the real estate as your second job. For green card purpose, you can start your own company as a restaurateur or IT solution but you can’t do it as your side business. These conventional business naturally require your attention 24/7. In the real estate investment, you don’t need to be that attentive as far as you hire the good management company.

Flexibility                                                                                                                                                       

After the investment,  you don’t necessarily have to live in Japan all the time. If you hire the good management company for your property, you don’t have to be in Japan everyday (but for green card purpose, you need to be in Japan from time to time to show your willingness to obtain the green card). In another words, if you have a good job in your country,  you don’t have to quit while pursuing the green card application process. This is the major advantage the real estate can offer. You normally must live in Japan when you apply for the green card.
Finance for non-residents                                                                                                                             

A few Japanese banks could finance the deal of the real estate investment for non-residents. You may be able to obtain the financing from a Japanese bank while you are residing in your country.

Practical process for the application for green card as HSP through the real estate investment.

  1. Establish your company in Japan with the support of the lawyer

You usually need to be in Japan when you establish an entity but if you work with the Japanese lawyer

you can open your bank account with a Japanese bank and they can support your administration

2. Build your business plan (investment plan) to submit the immigration official

You have to have the very logical plan to convince the officials

3. Investment

If you have your company establish, you can start investing in the real estate

4. Come to Japan

If your points don’t exceed 70 points at the beginning,  you can still apply for the ‘business manager visa’ to
stay in Japan and earn more points by learning  Japanese or obtaining MBA etc.

One example to reach 80 points (there are other categories of points calculation in the table, so if you want to know details, please contact us)

University degree                                                       : 10 points

Global top university                                                  : 10 points

Business experience as a manager (in any field)    : 25 points (if you experience is more than 10 years)

Establishing your company and becoming CEO     : 10 points (If you become CEO of your own company in Japan)

Income                                                                     :  10 points

                                                                                   (if your income in Japan is more than 10 mil yen)

Japanese proficiency                                                : 10 points (you need to take a test)   

Investment                                                                 : 5 points (if you invest more than 100 mil yen)

Total 80 points

 

FAQ

Question 1: What is the baseline for minimum annual salary?
Answer: A total of at least 70 points is required in order for an applicant to qualify as a

highly-skilled foreign professional, but with regard to advanced specialized/technical activities (Highly-Skilled Professional (i)(b)) and advanced business management activities (Highly-Skilled Professional (i)(c)), if the foreign national has an annual salary which is below 3 million yen, such foreign national will not be recognized as a highly-skilled foreign professional even where his/her total aggregate score from other items exceeds 70.

Question 2: What kind of university is the “university specified by the Minister of Justice in a public notice”?

Answer: The following universities will apply. Please check the website of the Ministry of Justice for a detailed list of universities.
In addition, although duplicate points are not allowed for I, II or III, duplicate points may be awarded in relation to “a person who has graduated from a university or a person who has completed the course of a graduate school, and has been awarded a degree in Japan”.

I Universities ranked in the top 300 in at least two of the following university rankings (1) QS World University Rankings (QS Quacquarelli Symonds Limited (UK))
(2) THE World University Rankings (Times (UK))
(3) Academic Ranking of World Universities (of Shanghai Jiao Tong University

(China))
II Universities receiving subsidies through the Top Global Universities Project

implemented by the Ministry of Education, Culture, Sports, Science and

Technology
III Universities designated as “partner schools” in the Innovative Asia Project

implemented by the Ministry of Foreign Affairs

Question 3: What kinds of activities are highly-skilled foreign professionals engaged in

advanced business management activities allowed to perform?
Answer: Operation of companies and management of legal and auditing offices, etc., are

permitted. In addition, starting and operating related businesses in conjunction with those activities is permitted.

Question 4: Are only executives of large firms approved as highly-skilled foreign professionals engaged in advanced business management activities?

Answer: Advanced business management activities refer to a person making important decisions regarding company’s operations, carrying out work, performing supervisory work as an officer of the company, managing a department or larger section of a company as a manager, or otherwise performing business management activities. The size of the company and whether the person is an executive is not a direct condition.

Question 5: I am currently residing in Japan with a status of residence other than that of “Highly-Skilled Professional”. Can I have my status of residence changed to that for highly-skilled foreign professionals?

Answer: A foreign national already residing in Japan, with a status of residence which is not that of a highly-skilled foreign professional, is able to apply to change his/her status of residence to any of “Highly-Skilled Professional” (a), (b), or (c). Examination of his/her application will determine whether his/her work pertains to the activities of highly-skilled foreign professionals, whether the point calculation reaches a passing score (70 points), and if there have been any problems during his/her stay in Japan. If all those conditions are met, permission to change a status of residence may be granted.

Question 6: If a highly-skilled foreign professional, who currently has the status of residence of “Designated Activities”, wishes to apply for the status of residence of “Highly-Skilled Professional (ii)”, is he/she first required to change his/her status of residence to “Highly-Skilled Professional (i)” and then reside in Japan for three years before being able to apply?

Answer: A foreign national who has been residing in Japan as a highly-skilled foreign professional under the status of residence of “Designated Activities” and has been engaging in the activities coming under the status of residence for three years or more, may apply to change his/her status of residence directly to “Highly-Skilled Professional (ii)”.

Question 7: How much do I have to invest to apply for the green card ?

Answer : There is no minimum amount of the investment but your income through your entity in Japan needs to be minimum 3 million yen. And you invest more than 100 million yen, you will earn 5 points for your visa application.

Question 8: Realistically speaking, how long does it take to get green card ? 

Answer : It all depends on each individual’s case however, if your points are not exceeding 70 points, you must get ‘business manager’ visa first and would probably need
two to three years to earn more points to reach 70 points or more.

Other Helpful Article
Fast track for permanent residency for highly skilled foreigners :Japan’s Groundbreaking New Green Card system

Relevant articles in the media

Why Japan is going to accept more foreign workers (Economist)

Japan to upgrade immigration bureau to welcome foreign workers (Nikkei)

Foreign resident number in Japan hits record high of 2.56 million (Asahi Shimbun)

Final Thought

The above practical strategy is for those who wish to invest in the property in Japan (and make money) and stay in Japan without renewing the visa.
Alternatively, you can acquire the existing business in Japan such as the restaurant with property, hotel and Airbnb type property. For green card, I should recommend the real estate investment as it is the stable investment and easy to exit. (You can’t exit your conventional business easily)

To apply the permanent residence visa, you must have the support from the specialist who has the deep knowledge of the handling the visa as well as the business experience to build the business plan to convince the immigration officials for you.
If you become the permanent resident in Japan, you are naturally eligible for the social security system and Japan’s world-class universal health care system.
If you want to learn more details, please contact us.

*Editing on November 4, 2018
We have received many inquiries about the new green system since we have posted the article.
There are some common misunderstandings about the system.The new fast track green card system does not necessarily require the real estate investment.
-You can apply for the green card by starting other new ventures such as IT solutions and travel company.
In other words, the real estate investment is merely a tool to help your application but not the norm.
-The immigration law does not specify any criteria for the real estate investment. (because it is not about the real estate investment)
-There is no minimum investment required for green card application but if you invest more than 100 mil yen then you can get extra points.
-You have to hire a specialist(lawyer) who is familiar with the immigration law. Average gyoseishoshi (行政書士)cannot handle the new system.
Gyoseishoshi could support you but they handle the documentation only. You have to have input more than documentation to convince
the immigration office to justify your application. Your story is more important than your documentation.

Consultation service
Spot consultation is available for those who are interested in getting Japan’s green card leveraging the real estate investment.
Consultation over the internet telephone is possible for those who are distant from Tokyo.
If you are seriously interested in obtaining the green card, please contact us. Consultation fee starts from 50,000 yen per two hours (plus tax)

If you want to learn more details, please contact us.

Toshihiko Yamamoto
Real estate investing consultant and author.
Founder of Yamamoto Property Advisory in Tokyo.
International property Investment consultant and licensed
real estate broker (Japan).
He serves the foreign companies and individuals to buy and sell
the real estates in Japan as well as own homes.
He holds a Bachelor’s degree in Economics from
Osaka Prefecture University in Japan
and an MBA from Bond University in Australia
Toshihiko’s book, “The Savvy Foreign Investor’s Guide to Japanese Properties: How to Expertly Buy, Manage and Sell Real Estate in Japan”
is now out on Amazon, iBooks (iTunes, Apple) and Google Play.
About the book

 

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