The International Business Center (“IBC”) regime

• Royal Decree No. 671 abolishes the Regional Operating Headquarters (ROH) regime. All privileges will cease for existing ROH companies in the accounting year that starts between 1 January 2020 and 31 December 2020.
• Royal Decree No. 672 abolishes the International Headquarters (IHQ) regime. IHQ companies may maintain the IHQ status for the remainder of their allotted term (i.e., capped at 15 years).
• Royal Decree No. 673 abolishes the International Trading Center (ITC) regime. ITC companies may maintain the ITC status for the remainder of their allotted term (i.e., capped at 15 years).
• Royal Decree No. 674 enacts the IBC regime. Supplementary information on the implementation processes should follow soon.

ROYAL DECREE NO. 674: THE IBC REGIME

(1) IBC Privileges

(2) IBC Qualifying Income

(3) Qualifying Conditions to apply for the IBC incentives

(4) Disqualification of the IBC status

(5) Regime migration

(6) Deloitte’s observations

* This Article is based on the relevant Japanese or specific country’s tax law and other authorities in effect on the date of this Article. This Article would not be guaranteed updating if there are any changes in Japanese tax law, any other law, or interpretations by the courts or tax authorities thereof after the date of this Article.