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Although the legal forms for business enterprises available in Japan and the United States differ greatly, the practical tendency of small enterprises to favor the corporate form raises parallel issues and problems in both the United States and Japan. On their face, the legal forms for businesses in Japan are more similar to the forms of West Germany. However the overriding preference of Japanese enterprises for the corporate form, a form not originally intended for small businesses, represents a departure from legislative intent that makes the problems of the Japanese closely held corporation very similar to those of their American counterparts.' This paper will compare and contrast the Japanese and American legal approaches to closely held corporations. It will further critique the Japanese new tentative draft on close corporations. 2 Although there are seven types of enterprises in Japan, the

the american journal of comparative law

Problems of the Closely Held Corporation: A Comparative Study of the Japanese and American Legal Systems and a Critique of the Japanese Tentative Draft on Close Corporations