A , abbreviated in English as "Y.K." or "Co., Ltd.", was a form of business organization in

Japan Japan is an island country in East Asia. Located in the Pacific Ocean off the northeast coast of the Asia, Asian mainland, it is bordered on the west by the Sea of Japan and extends from the Sea of Okhotsk in the north to the East China Sea ...

. were based on the German and were implemented in Japan in the of 1940. The

Companies Act of Japan The law of Japan refers to the legal system in Japan, which is primarily based on legal codes and statutes, with precedents also playing an important role. Japan has a Civil law (legal system), civil law legal system with six legal codes, which ...

, implemented on May 1, 2006, replaced the with a new form of company called , based upon the American

limited liability company A limited liability company (LLC) is the United States-specific form of a private limited company. It is a business structure that can combine the pass-through taxation of a partnership or sole proprietorship with the limited liability of ...

. Following the implementation, no new YKs were allowed in Japan, but pre-existing YKs were allowed to continue their operations as under special rules. Whether the term is pronounced as or is up to the local dialect or the company's preference when it is part of the company's name. While it is pronounced in standard Japanese, the alphabetic abbreviation is always Y.K. by standard.

Structure

As of 2005, a Y.K. can have up to 50 investors, called . The members were required to provide at least ¥3 million in capital contributions, with individual valued at no less than ¥50,000. The minimum capital amount was much more permissive than the ¥10 million minimum for a . A Y.K. was also not required to issue certificates for investment units, whereas stock certificates were required for a K.K. Unlike a K.K., a Y.K. does not need to have a board of directors or statutory auditors: the minimum requirement is one . Because of its simplified structure and relatively lax incorporation requirements, the Y.K. form is associated with small businesses. However, some larger companies have used the form:

ExxonMobil Exxon Mobil Corporation ( ) is an American multinational List of oil exploration and production companies, oil and gas corporation headquartered in Spring, Texas, a suburb of Houston. Founded as the Successors of Standard Oil, largest direct s ...

's principal Japanese subsidiary, for instance, is a Y.K. with paid-in capital of ¥50 billion (US$420 million). In addition to simplified

corporate governance Corporate governance refers to the mechanisms, processes, practices, and relations by which corporations are controlled and operated by their boards of directors, managers, shareholders, and stakeholders. Definitions "Corporate governance" may ...

, a Y.K. receives some tax benefits under foreign laws such as the U.S.

Internal Revenue Code The Internal Revenue Code of 1986 (IRC), is the domestic portion of federal statutory tax law in the United States. It is codified in statute as Title 26 of the United States Code. The IRC is organized topically into subtitles and sections, co ...

References

{{DEFAULTSORT:Yugen Gaisha Types of business entity Japanese business law Japanese business terms 1940 establishments in Japan 2006 disestablishments in Japan