# Japan's tighter visa rules are pushing foreign business owners out of the country

Capital requirements for the business manager visa rose sixfold to 30 million yen, and nearly 1,000 holders left Japan in the first half of 2026.

- Published: 2026-10-03T05:22:27.492Z
- Canonical: https://polylog.news/2026-10-03/japan-s-tighter-visa-rules-are-pushing-foreign-business-owne
- Publisher: Polylog (Global desk)
- Section: macro
- Sources: [South China Morning Post](https://www.scmp.com/week-asia/economics/article/3369608/no-more-welcome-mat-japans-tough-visa-rules-spur-foreign-businesses-look-elsewhere?utm_source=rss_feed), [Nikkei Asia](https://asia.nikkei.com/spotlight/japan-immigration/foreign-business-owners-leave-japan-in-droves-under-tighter-visa-rules), [Nippon.com](https://www.nippon.com/en/japan-data/h02801/)

Foreign entrepreneurs who built businesses in Japan are leaving or looking elsewhere after the government sharply raised the requirements for the business manager visa. The [South China Morning Post reported](https://www.scmp.com/week-asia/economics/article/3369608/no-more-welcome-mat-japans-tough-visa-rules-spur-foreign-businesses-look-elsewhere?utm_source=rss_feed) the case of a couple who had expanded small businesses across several sectors five years ago and now describe a sense of hostility toward them.

The rule change is specific. From October 2025 the Immigration Services Agency required applicants to hold 30 million yen (about $187,000) in capital, up from 5 million yen, and to employ at least one full-time worker who is Japanese or holds stable residency. From January 2026 new applicants must also demonstrate Level N3 Japanese, an intermediate level on the country's standard proficiency test. The agency cited the use of shell companies to obtain residency.

The effect is measurable. Nearly 1,000 foreign nationals on business manager visas left Japan in the first half of 2026, almost four times the number a year earlier, [Nikkei Asia reported](https://asia.nikkei.com/spotlight/japan-immigration/foreign-business-owners-leave-japan-in-droves-under-tighter-visa-rules). [Nippon.com documented](https://www.nippon.com/en/japan-data/h02801/) the same contraction in applications and approvals.

The policy addresses a real abuse and carries a cost. Japan's working-age population is shrinking, the yen is weak at about 157 to the dollar, and small foreign-owned firms are one of the few channels bringing both capital and labour into regional economies.

## What this means

The channel is inward investment and labor supply at the smallest scale, which is where Japan's demographic shortfall is most severe. Raising the capital threshold sixfold screens out exactly the category of migrant who starts a restaurant, a logistics firm, or a translation agency in a shrinking regional city, and the losers are landlords, local tax bases, and the service businesses that would have employed their staff. The government gains control over a visa route it says was abused, and gains it at low political cost. The precedent is the United Kingdom's closure of its Tier 1 entrepreneur visa route after 2019, which reduced fraudulent applications and also cut genuine small-business formation by foreign founders. The likelier outcome over the next year is continued net departure of small foreign-owned businesses from Japan and a shift of that activity toward Southeast Asian hubs, unless the Immigration Services Agency introduces a lower-threshold track for founders who are already operating profitably. A visible reversal would be partial exemptions for existing visa holders, which is the concession business groups are asking for.

## What to watch

- Whether Japan creates an exemption or transition path for entrepreneurs who already run established businesses, the main request from affected owners.
- Business manager visa application and approval figures in the next published quarter, which will show whether the drop in new applications is permanent.
- Where departing founders relocate, since a visible shift of small-business formation to Singapore, Malaysia, or Thailand would make the cost of Japan's rule change concrete.