I have worked as a Japanese Legal Specialist (Gyosei Shoshi) for over 19 years, primarily helping foreigners establish companies in Japan. I handled everything from drafting articles of incorporation and coordinating with judicial scriveners for registration, to visa applications and obtaining necessary business licenses — all at more reasonable fees than large firms. At the same time, I have also provided advice and support for company formations in the United States.
This time, I want to share the unexpected hurdles I personally encountered while forming my own ILS Law LLP in California. Although I established an LLP (Limited Liability Partnership), the overall process is very similar for LLCs and C Corporations. The “walls” you will face are largely the same regardless of entity type, so please use this as a reference.
LLP vs. LLC in California
In California, an LLP can only be formed by licensed professionals such as attorneys, accountants, and architects. Unlike in Japan, where an LLP is treated simply as a partnership, a California LLP is recognized by the Secretary of State (SOS) as a separate legal entity. Partners receive limited liability protection, but the entity must also register and pay taxes with the Franchise Tax Board. It offers pass-through taxation like an LLC, while providing strong limited liability protection — making it a flexible and practical choice. (Note: Non-residents cannot form an S Corporation in California, so LLP or LLC is usually the better option for flexibility.)
1. Preparation Before Filing
Deciding Members and Signing the Operating Agreement
You must first decide the members, the management structure (Member-Managed or Manager-Managed for LLCs), and prepare the appropriate agreement. For a C Corporation, Bylaws are also required.
Office Address and Lease Agreement
You need a physical or virtual office address before filing. While a virtual office is acceptable for registration, postal requirements often demand a real U.S. address. Opening a corporate bank account is especially difficult with only a virtual office.
2. The Filing Process – Challenges from Japan
a. Online Application Issues
California offers the BizFilings online system, but I could not access the system no matter how many times I tried. Long after contacting support with no success, I learned I needed a VPN because I was accessing it from outside the U.S. At the time of the filing, I gave up on online filing and tried mailing the documents. However, they did not accept credit cards — only money orders or checks. Since Japanese banks and post offices cannot easily issue U.S. money orders, I had to ask one partner living in the U.S. to submit using a personal check. The process involved multiple corrections and missed deadlines, requiring three urgent calls from that partner before the registration was finally completed. Conclusion: Filing from Japan is almost impossible for an LLP.
b. Members Located in Different Countries and Time Zones
Our LLP has partners in Hawaii, Osaka, and Tokyo. Coordinating schedules, document signing, bank account opening meetings, and tax filings across time zones created a huge burden. If members are not in the same location, you must budget significant extra time and effort.
3. Post-Formation Requirements
EIN (Employer Identification Number)
Equivalent to Japan’s 13-digit corporate number. You can obtain this online from the IRS website.
Corporate Bank Account
Extremely difficult for newly formed companies with foreign/non-resident representatives. As an attorney, I also needed to open an IOLTA account (client trust account). I am deeply grateful to the two bank officers who worked with me through many rounds of documentation.
4. Business Licenses and County Registration
Required for almost all entities. Requirements vary by industry and location. Since our LLP is based in Century City, we needed both California state licenses and separate Los Angeles County registration and tax filings.
California State Bar Registration (for Attorney LLPs)
For attorney LLPs, both individual attorney registration and LLP registration are required, with annual renewal. The system used is called “Agency Billing.” To be honest, this system is extremely difficult to use. Even when I asked AI, it couldn’t explain it properly. When I submitted inquiries to the Bar, responses took four months. If I tried to follow up to the response, the case would automatically close. When I paid the renewal fee based on the delayed response, they automatically charged late fees. Even after complaining, they ignored me. I have heard many other attorneys also strongly complain about this system, but since it is run by the State Bar, there is little recourse. In the end, all you can do is sigh and accept that “this is America” period
Summary – This Is Why Professional Help Is Worth It
Forming a company in California involves far more hurdles and unexpected complications than in Japan. While each step is not impossibly difficult on its own, handling everything while running your business can cause serious problems. Guidance from someone with real experience — especially for bank accounts, licensing, and State Bar procedures — is extremely helpful.
If you are considering forming a company in California, feel free to contact me. Consultations are available in-person at our Century City office or online.