The process for obtaining a license to transact business from the Philippines SEC to operate a Foreign Company Representative Office in the Philippines is similar to that of the Foreign Company Branch Office.
The required annual minimal inward remittance of funds for a Foreign Representative Office as working capital is US$ 30,000.00 as opposed to a one time minimum remittance of US$200,000.00 of a Foreign Branch Office as mandated by the SEC regulations. Every year the parent company must remit at least US$ 30,000.00 to cover operating expenses.
A Representative Office of a foreign corporation may not derive income from its operations in the Philippines. All of its operating costs must be covered by transfer of funds from the parent company. Usual activities allowed are dealing with the clients of the parent company, dissemination of information, promotion of company products and quality control of products for export. It is forbidden to offer services to 3rd parties.
A Representative Office does not pay income taxes as none of its income is derived from the Philippines and is not qualified to apply for tax incentives with the BOI or PEZA authorities.
Dayanan Philippines Business Consultants will assist you with the setup and registration of your business with the relevant government agencies for a quick opening of a representative office in Philippines.
Philippines Representative Office Requirements
1 – Application Form
2 – Name Verification Slip (A name search will be done at the SEC to determine if the corporate name has any similarity with an existing corporation already registered with the SEC).
3 – Certified copy of the Board Resolution authorizing the establishment of an office in the Philippines; designating the resident agent to whom summons and other legal processes may be served in behalf of the foreign corporation; and stipulating that in the abscence of such or upon cessation of its business in the Philippines, any summons of legal process may be served to SEC as if the same is made upon the corporation at its home office
4 – Audited Financial Statements as of date not exceeding one year immediately prior to the filing of the application certified by an Independent Certified Public Accountant of the home country and authenticated before the Philippines Consulate/Embassy
5 – Certified copies of the Articles of Incorporation/By-laws/Partnership with an English translation thereof if in a foreign language (not English)
6 – Proof of Inward Remittance such as a bank certificate of inward remittance in the amount of US$30,000.00
7 – Resident Agent’s acceptance of appointment 9not necessary if agent is the signatory in the application form)
All foreign documents must be authenticated by the Philippines Embassy/Consulate of the home country.
Once the SEC has issued a license to operate, the representative office is required to obtain Philippines local business permits and register with the Bureau of Internal Revenue. The representative office may now apply for work permits and visas for its foreign employees.