Establishing a Social Welfare Corporation (Shakai Fukushi Hojin, or SWF) in Japan is a formal, multi-stage process governed by the Social Welfare Act and its related ordinances. It involves meticulous preparation, securing approvals from a supervisory government authority (Shokatsu-cho), and finally, completing a legal registration that brings the entity into existence. This article provides a step-by-step guide through this journey, from the initial drafting of the Articles of Incorporation to the final act of establishment registration.

I. The Preparatory Phase: Laying the Groundwork

Before any formal applications are made, significant preparatory work is essential for a smooth establishment process.

A. Identifying Founders (Setsuritsusha) and Defining the Mission

The journey begins with the "founders" – the individuals or entities initiating the SWF's creation. Their initial responsibilities include:

• Articulating the Core Mission: Clearly defining the specific social welfare services the SWF intends to provide (whether First-Class or Second-Class services)[cite: 29]. This forms the "purpose" of the SWF.
• Determining Operational Scope: Outlining the initial scale of operations and the geographical area the SWF will serve.
• Securing Asset Commitments: A critical early step is ensuring the SWF will have the necessary assets to carry out its functions, as stipulated by Article 25 of the Social Welfare Act[cite: 12, 26]. This includes "fundamental assets" (Kihon Zaisan) essential for core operations and other operational assets. Founders often contribute these initial assets through donations or endowments.

B. Appointing Prospective Governance Members

Founders must also identify and secure commitments from individuals who will form the initial governance structure of the SWF. This involves selecting:

• Prospective Councillors (Hyōgiin)
• Prospective Directors (Riji), including one individual who will likely serve as the initial President (Rijichō) [cite: 33]
• Prospective Auditors (Kanji)

It is crucial to ensure these individuals meet the strict qualification criteria, are free from any disqualifying conditions, and comply with the related-party restrictions detailed in the Social Welfare Act and its Enforcement Rules[cite: 30]. These rules are designed to ensure integrity and prevent conflicts of interest within the SWF's leadership.

II. Drafting the Articles of Incorporation (Teikan)

The Articles of Incorporation (Teikan) serve as the SWF's foundational constitutional document, outlining its structure, purpose, and operational rules.

A. Essential Content

The Social Welfare Act (Article 31, Paragraph 1) mandates several items that must be included in the Teikan (these are known as "absolute-essential matters" or Zettai-teki Kisai Jikō)[cite: 35]. These include, but are not limited to:

• The SWF's purpose[cite: 35].
• Its official name[cite: 35].
• The types of social welfare services it will undertake[cite: 35].
• The location of its principal office (and any secondary offices)[cite: 35].
• Provisions concerning Councillors and the Councillor Council[cite: 35].
• The number of Directors and Auditors, and other matters related to these officers[cite: 35].
• Provisions concerning the Board of Directors[cite: 35].
• If an Accounting Auditor is to be appointed, provisions related to this role[cite: 35].
• Matters concerning the SWF's assets[cite: 35].
• Matters concerning accounting[cite: 35].
• Provisions for amending the Teikan[cite: 35].
• The method of public notice[cite: 35].

Furthermore, the names of the individuals who will serve as the initial Officers (Directors, Auditors) and Councillors upon establishment must also be stipulated directly within the Teikan (Article 31, Paragraph 3)[cite: 38]. This is often done in an addendum or supplementary provision to the main Teikan document for the establishment phase. It is common practice for Teikan to also include a clause stating that, after the SWF's legal establishment, officer elections will be held promptly in accordance with the newly effective Teikan[cite: 38].

The Teikan can be prepared as an electronic document if desired (Article 31, Paragraph 2)[cite: 35].

III. Application for Establishment Approval from the Supervisory Authority (Shokatsu-cho)

Once the Teikan is drafted and initial commitments are in place, the next major step is to apply for establishment approval (設立認可 - Setsuritsu Ninka) from the appropriate Shokatsu-cho.

A. The Application Package

The application for approval is a comprehensive submission. According to the Social Welfare Act Enforcement Rule (Article 2, Paragraph 5), the application form, the Teikan, and one copy of the Teikan must be submitted[cite: 30]. Key components include:

1. Application Form (設立認可申請書 - Setsuritsu Ninka Shinseisho):
   This official form requires specific information (as detailed in Enforcement Rule Article 2, Paragraph 1)[cite: 30], such as:
   • The name(s) and address(es) of the founder(s) or their designated representative[cite: 30].
   • The proposed name and principal office location of the SWF[cite: 30].
   • The statement of purpose for establishing the SWF[cite: 30].
   • The names of all individuals nominated to be the initial Councillors, Directors, and Auditors[cite: 30].
   • Detailed declarations regarding any special relationships (as defined by Enforcement Rules Articles 2-7, 2-8, 2-10, and 2-11) between prospective Councillors themselves, between prospective Councillors and prospective Officers, and among prospective Officers[cite: 30]. This is to ensure compliance with rules designed to prevent conflicts of interest or undue influence by related parties.
2. Attached Supporting Documents (Enforcement Rule Article 2, Paragraph 2)[cite: 31]:
   • The drafted Articles of Incorporation (Teikan).
   • Property Inventory (財産目録 - Zaisan Mokuroku): This document lists all assets (cash, real estate, securities, etc.) that will be endowed to the SWF upon its establishment. Crucially, this must be accompanied by evidentiary documents that clearly demonstrate these assets will be securely and definitively transferred to the SWF (e.g., formal donation agreements, bank balance certificates for cash endowments, copies of title deeds if real estate can be immediately transferred, or binding commitments for future transfer).
   • Documents for Real Estate Use (if not initially owned): If the SWF plans to use real estate (e.g., for an office or facility) that is not part of the initially endowed assets (for instance, if it will be leased), documents proving the SWF will have a secure right to use these premises must be provided (e.g., draft lease agreements or letters of intent from the property owner).
   • Business Plan (事業計画書 - Jigyō Keikakusho) and Budget (収支予算書 - Shūshi Yusansho): A detailed business plan outlining the intended activities, operational strategies, and service delivery models for the SWF's initial fiscal year and the immediately following fiscal year, along with corresponding financial budgets showing projected income and expenditures for these periods.
   • Resumes (履歴書 - Rirekisho) of the Founder(s).
   • Proof of Authority for Founder's Representative: If multiple founders have designated one person to act as their representative for the establishment process, documents formally evidencing this representative's authority are required.
   • Resumes and Letters of Acceptance (就任承諾書 - Shūnin Shōdaku sho): Resumes for all individuals nominated to be prospective Councillors, Directors, and Auditors, along with their formal written letters of acceptance, confirming their willingness to assume these roles once the SWF is established. The application should clearly indicate which of the prospective directors is slated to be the initial President (理事長予定者)[cite: 33].
3. Potential Additional Documents (Enforcement Rule Article 2, Paragraph 3)[cite: 31]:
   The Shokatsu-cho has the authority to request any other documents it deems necessary for its review. This might include, for example, independent third-party valuation reports for any real estate being contributed as an asset, or more detailed financial projections.

B. The Review and Approval Process by the Shokatsu-cho

Upon receiving the complete application package, the Shokatsu-cho undertakes a thorough review (Social Welfare Act, Article 32)[cite: 33]. The authority examines:

• Whether the assets proposed to be endowed to the SWF are sufficient and appropriate for the types and scale of social welfare services the SWF intends to conduct.
• Whether the content of the drafted Articles of Incorporation fully complies with the requirements of the Social Welfare Act and other relevant laws and regulations.
• Whether the establishment procedures undertaken by the founders, as evidenced by the application and supporting documents, adhere to all legal requirements.

It is important to note that the Shokatsu-cho's decision on approval is not discretionary in the sense of arbitrary judgment. If the application demonstrates that all legal requirements concerning assets, Teikan content, and procedures have been met, the Shokatsu-cho is obligated to grant approval for the establishment.

IV. Post-Approval: Asset Transfer and Reporting

Receiving the Certificate of Approval (認可書 - Ninka-sho) from the Shokatsu-cho is a major milestone, but it is not the final step before registration.

A. Formal Transfer of Endowed Assets

According to the Social Welfare Act Enforcement Rule (Article 2, Paragraph 4), once approval for establishment is granted, the founders must proceed "without delay" (遅滞なく - Chitai naku) to formally transfer all assets listed in the initially submitted property inventory to the SWF[cite: 33]. (At this point, the SWF has an incipient legal status, pending formal registration). This process involves concrete actions such as:

• For real estate: Executing deeds of gift or sale, and completing the legal registration of title transfer in the name of the SWF at the Legal Affairs Bureau.
• For cash: Depositing the funds into bank accounts opened in the name of the (soon-to-be-formally-established) SWF.
• For securities or other assets: Completing all necessary legal procedures for transfer of ownership.

B. Reporting Asset Transfer Completion to the Shokatsu-cho

Within one month of the completion of all asset transfers, the SWF (acting through its founders or prospective representatives) must submit a formal report to the Shokatsu-cho confirming that these transfers have been finalized (Enforcement Rule Article 2, Paragraph 4)[cite: 33]. This report must be accompanied by documentary evidence proving the completion of the transfers (e.g., updated bank passbooks or statements showing the deposits, certified copies of the real estate register showing the SWF as the new owner).

V. Establishment Registration (Setsuritsu no Tōki) with the Legal Affairs Bureau

This is the final legal step that formally brings the Social Welfare Corporation into existence as a juridical person.

A. Critical Timing for Registration

The application for establishment registration must be filed with the competent Legal Affairs Bureau (Hōmukyoku) that has jurisdiction over the SWF's principal office location. This must be done within two weeks from the date on which all necessary establishment procedures are considered complete (Order for Registration of Cooperatives, etc. [組合等登記令 - Kumiai-tō Tōki Rei], Article 2, Paragraph 1)[cite: 33]. The date the Certificate of Approval from the Shokatsu-cho is received is often considered the start of this two-week period[cite: 41].

B. Registration as the Act of Creation

It is only upon the successful completion and acceptance of this establishment registration by the Legal Affairs Bureau that the Social Welfare Corporation officially comes into legal existence and acquires its juridical personality (Social Welfare Act, Article 34)[cite: 29].

C. Key Documents for Establishment Registration

While Q11 of the reference material focuses heavily on the Shokatsu-cho approval phase, Q18 details the typical documents required for the actual establishment registration with the Legal Affairs Bureau[cite: 41]. These generally include:

• The Articles of Incorporation (Teikan), as approved by the Shokatsu-cho[cite: 41].
• The Certificate of Approval (Ninka-sho) for establishment issued by the Shokatsu-cho, or a certified copy thereof[cite: 41].
• Documents specifying the exact location (down to the lot number) of the principal office (and any secondary offices being established concurrently), if the Teikan only lists a broader administrative area (e.g., resolutions of the founders or the initial Board of Directors)[cite: 41].
• Documents evidencing the selection of the initial President (Rijichō), such as minutes of the first meeting of the Board of Directors where the President was selected from among the initial Directors, along with the President's formal letter of acceptance. Alternatively, if the Teikan itself names the initial President, that may suffice.
• Letters of acceptance from all initial Directors and Auditors (unless already covered by general acceptance for their roles which might be part of the Shokatsu-cho submission).
• The Property Inventory (Zaisan Mokuroku) created at the time of establishment, which serves to verify the "Total Value of Assets" (資産の総額 - Shisan no Sōgaku) – a mandatory item for registration[cite: 42].
• A Power of Attorney (委任状 - Ininjo), if the application is being filed by an agent such as a judicial scrivener[cite: 42].
• Seal Registration: The SWF will need to register its official corporate seal (法人実印 - Hōjin Jitsuin) and the official seal of its representative (the President) with the Legal Affairs Bureau[cite: 42].

D. Penalties for Non-Compliance

Failure to file for establishment registration within the prescribed two-week period can lead to the imposition of non-penal monetary fines on the SWF's representative (e.g., the President) under the provisions of the Social Welfare Act (Article 133, Item 1)[cite: 33].

VI. Simplified Process Flow Summary

The entire establishment process can be visualized as follows[cite: 29]:

1. Draft Articles of Incorporation (Teikan) and prepare supporting application documents.
2. Apply to the relevant Shokatsu-cho for establishment approval.
3. Receive Certificate of Approval from the Shokatsu-cho.
4. Formally transfer all endowed assets to the SWF.
5. Submit a report of asset transfer completion to the Shokatsu-cho.
6. File the application for establishment registration with the competent Legal Affairs Bureau.
7. Upon successful registration, the Social Welfare Corporation is legally established.

VII. Initial Actions Post-Establishment

While not strictly part of the establishment registration process, it's important to remember that once the SWF is legally established, its formal governance bodies (Councillor Council, Board of Directors) will need to convene. These initial meetings will ratify actions taken during the establishment phase, formally confirm officer roles (especially if the Teikan provided for prompt elections post-establishment [cite: 38]), approve initial operational budgets if not already finalized, and officially commence the SWF's planned social welfare services.

Conclusion

The path to establishing a Social Welfare Corporation in Japan is detailed and requires adherence to a sequence of legal and administrative steps. From meticulous planning and drafting of the Articles of Incorporation, through the critical approval phase with the supervisory authority, to the final act of registration with the Legal Affairs Bureau, each stage demands careful attention to documentation and deadlines. Understanding this comprehensive process is fundamental for any individuals or groups aiming to create an SWF and contribute to Japan's social welfare landscape. Due diligence, thorough preparation, and often professional legal guidance are key to navigating these requirements successfully.