6.M&A

|Q4 (Merger with Foreign Company)

Is it possible to merge with a foreign corporation?

There is some dispute among scholars, but a “company” under the Companies Act (Article 2, Section 1) as a party in a merger is defined as “a corporation (kabushiki kaisha), a general partnership company (goumei kaisha), a limited partnership company (goushi kaisha) or a limited liability company (goudou kaisha)”, which does not include a foreign corporation. Also, the Legal Affairs Bureau will not accept the registration of a foreign corporation in a merger. Therefore, practically speaking, a foreign corporation cannot merge with a Japanese corporation.

(Posted: January 27, 2012)