This article outlines the steps required to complete a Japanese absorptive merger involving one company (below the ‘Surviving Company’) taking over the assets and liabilities of a liquidating company (below the ‘Ceasing Company’ and collectively with the Surviving Company the ‘Companies’) under a process defined by the Japanese Corporate Law (the ‘JCL’).
A Japanese merger involves two or more companies becoming one company further to a defined process in the Japanese Corporate Law (below the ‘JCL’). This article outlines legal aspects of the merger process as background for more detailed analysis of the Japanese tax treatment of mergers and other corporate reorganizations. Read More
This post is the first in a series looking at how the return of funds to shareholders is treated for Japanese tax purposes. Funds can be returned to a company’s shareholders through dividends, deemed dividends, share-buy backs, return of surplus on a liquidation and other transactions (below ‘Shareholder Distributions’).
In order to understand how Shareholder Distributions are taxed Read More
Recent years has seen a real revolution in Japanese corporate law and one area is the greatly increased flexibility in the different types of shares that can be issued. For tax purposes ownership of 100% of all classes of shares is a requirement to tax consolidate a subsidiar however the share types are used in a variety of transactions – poison pills, minority squeeze outs, that of course have tax implications and that will be explored in later posts.
Article 108 of the CL allows companies to issue more than one type of share. A company issuing more than two types of share under its articles of association (teikan/定款) is called a shurui kabishiki hakkou kaishi/種類株式発行会社 – a ‘Company Issuing Types of Shares’ could be a decent translation. The table below summarises these types: Read More