All businesses whether locally or foreign owned: corporations, branch offices or any other legal entity that will be licensed to do business in the Philippines are required to register their business with numerous government agencies.
The Philippines business registration requirements are:
1. Verify and reserve the business name with the Securities and Exchange Commission (SEC) 2. Obtain a Certificate of Inward Remittance (for Branch and Representative Office, RHQ and ROHQ) 3. Submit all the necessary application forms and other required documents to the SEC. 4. Obtain from the SEC the certificate of incorporation or license to transact business
The order of the following steps may vary depending on the municipality.
5. Obtain Barangay Clearance 6. Obtain Mayor’s Permit (business permit) 7. Purchase books of accounts 8. Register the business and the books of account with the Bureau of Internal Revenue 9. Pay to BIR the Documentary Stamp Taxes (DST) on the authorized capital 10. Obtain an Authority to Print official receipts, invoices etc… from the BIR (can only be printed by an authorized BIR printer 11. Register the company with the Social Security System (SSS), PhilHealth and Home Development Mutual Fund (HDMF)
Don’t forget to file the required monthly reports with the various government agencies the month following registering with them whether you have started operations or not. Failure to do so will incur penalties.
Foreign companies whose home country does not require them to prepare and submit audited financial statements are no longer mandated by the SEC to submit an audited financial statement to obtain a license to transact business in the Philippines for their branch or representative offices.
In line with Administrative Order No.38 on Ease of Doing Business Reforms, the Commission in its meeting on 30 May 2013 resolved to revise the requirements on financial statements and supporting documents that shall be submitted with an application of a foreign corporation for a license to transact business in the Philippines, issued SEC Memorandum Circular No. 11 Series of 2013.
Extract of the memo:
A. For those whose home country requires audited financial statements, the applicant shall submit the audited financial statements (AFS) as of date not exceeding one (1) year immediately prior to the filing of the application;
If the date of the AFS exceeds the one-year requirement, the following shall be submitted:
i. Audited financial statements that are available as of date of filing of the application; and ii. Unaudited financial statements (UFS) as of date not exceeding one (1) year immediately prior to the filing of the application.
B. For those whose home country does not require audited financial statements, the applicant shall submit the unaudited financial statements (UFS) as of a date not exceeding one (1) year immediately prior to the filing of the application provided that the UFS shall be accompanied by a Certification signed under oath by an officer of a responsible regulatory institution or by the applicant’s legal counsel that the applicant is not required to prepare and submit audited financial statements, with a citation of the law or regulation on which it is based. This new regulation will allow foreign corporation to save time and fees in obtaining the necessary documents needed for their branch or representative office application. This memo differs slightly from SEC Resolution No. 165 Series of 2012 revising the requirements on financial statements that accompany applications of foreign corporations for a license to transact business in the Philippines.
Whether you are a foreign company or an individual, you have multiple options depending on the nature of the business your company intends to operate.
To legally conduct business in the Philippines, your company should be registered with either the DTI or the SEC. Once registered with one of the latter, you will be required to obtain local company business permits.
Certain company structures are a better choice for individuals intending to open a small business. Philippines foreign investors generally may own and control any business within the limits of the Philippine foreign investment negative list.
Is a business structure which is owned by a single individual who owns all the assets and has unlimited personal liability for losses. There is no legal distinction between the owner and the business. A sole proprietorship must apply for a business name and be registered with the DTI.
Partnerships may either be general partnerships, where the partners have unlimited liability for the debts and obligation of the partnership, or limited partnerships, where one or more general partners have unlimited liability and the limited partners have liability only up to the amount of their capital contributions. It consists of two or more partners. The managing partner always has unlimited liability, must be a Filipino citizen and resident of the Philippines. A partnership with more than P3,000 capital must register with the Securities and Exchange Commission (SEC). Under the Civil Code of the Philippines, a partnership is treated as juridical person, having a separate legal personality from that of its members.
Must be registered with the SEC and have a minimum of 5 incorporators whom are usually the first directors. Every director must own at least one share of the corporation. The liability of the shareholders of a corporation is limited to the amount of their share capital. A corporation can either be stock or non-stock company regardless of nationality. A corporation, if 60% Filipino-40% foreign-owned, is considered a corporation of Filipino nationality; If more than 40% foreign-owned, it is considered a domestic foreign-owned corporation and of foreign nationality.
A one person corporation (OPC) is a corporation with a single stockholder, who can only be a natural person, trust or estate. The incorporator of an OPC being a natural person must of be of legal age.
Organized under Foreign Laws
1.Branch Office – is a foreign corporation organized and existing under foreign laws that carries out business activities of the head office and derives income from the Philippines. It is required to remit to the Philippines a minimum of US$200,000 as paid-in capital (this can be reduced depending on the nature of the business) .Registration with the SEC is mandatory.
2. Representative Office – is a foreign corporation organized and existing under foreign laws. It may not derive income from the Philippines and is fully subsidized by its head office. It deals directly with clients of the parent company as it undertakes such activities as information dissemination, acts as a communication center, and promotes company products, as well as quality control of products for export. It is required to have an initial minimum inward remittance in the amount of US$30,000 to cover its operating expenses and must be registered with the SEC
3.Regional Headquarters (RHQs) – An RHQ undertakes activities that shall be limited to acting as supervisory, communication, and coordinating center for its subsidiaries, affiliates, and branches in the Asia-Pacific region. It acts as an administrative branch of a multinational company engaged in international trade. It does not derive income from sources within the Philippines and does not participate in any manner in the management of any subsidiary or branch office it might have in the Philippines. Annual required minimum inward remittance is US$50,000 to cover operating expenses.
4.Regional Operating Headquarters (ROHQs) – An ROHQ performs the following qualifying services to its affiliates, subsidiaries, and branches in the Philippines. – General administration and planning – Business planning and coordination – Sourcing/procurement of raw materials components Corporate finance advisory services – Marketing control and sales promotion – Training and personnel management – Logistic services – Research and development (R&D) services and product development – Technical support and communications – Business development – Derives income in the Philippines – Required capital: US$200,000 – one time remittance
Once the entity you have chosen to setup has been licensed to transact business in the Philippines you may apply for work visas. It is necessary to have the appropriate visa to avoid being deported or placed on the immigration blacklist.
The Philippines has numerous government agencies making it one of the most bureaucratic countries in South East Asia. It takes time to know exactly what process each agency handles. To make it easier here is our Philippine Government Agency guide.
For those who want to streamline the processing of their documents with the government, Dayanan Philippines Business Consultants is here to assist you with Philippines business registration, tax incentive application and alien employment visa. Philippines Government Agencies
Philippines Securities and Exchange Commission SEC
The SEC was set up on 26 Oct 1936 by virtue of the Commonwealth Act No. 83 or the Securities Act. Its establishment was prompted by the need to safeguard public interest in view of local stock market boom at that time. The SEC was abolished during the Japanese occupation and was replaced with the Philippine Executive Commission. It was reactivated in 1947 with the restoration of the Commonwealth Government. Due to the changes in the business environment under Pres. Ferdinand Marcos, the agency was reorganized on 29 Sept 1975 as a collegial body with 3 commissioners and was given quasi-judicial powers under PD902-A.
The SEC has jurisdiction and supervision over all corporations, partnerships or associations who are the grantees of primary franchises and/or a license or permit issued by the Government. It also supervises the registration of branch offices, representative offices and regional headquarters.
Philippines Department of Trade and Industry DTI
The DTI serves as the principal coordinative, sponsorship, and facilitative arm for trade, industry and investment activities, and a means to increase private sector activity to accelerate and sustain economic growth through the following strategies:
A comprehensive industrial growth strategy
A progressive and socially responsible liberalization and deregulation program
Policies designed for the expansion and diversification of both domestic and foreign trade
Under the DTI are seven major functional groups composed of bureaus that provide support to DTI’s line agencies and are involved in line operations, which deliver business and consumer services directly to the stakeholders and the public.
DTI agencies of special interest to foreign investors are:
– PEZA (Philippines Economic Zone Authority)
– BOI (Board of Investments)
– IPO (Intellectual Property Office)
– SEC (Securities and Exchange Commission)
It also supervises the registration of company names and sole proprietorship.
Philippines National Telecommunications Commission (NTC)
The NTC is the government agency established under Executive Order No. 546 promulgated on July 23, 1979, and conferred with regulatory and quasi-judicial functions taken over from the Board of Communications and the Telecommunications Control Bureau which were abolished in the same Order.
First and foremost, the NTC is the sole body that exercises jurisdiction over the supervision, adjudication and control over all telecommunications services throughout the country. For the effective enforcement of this responsibility, it adopts and promulgates such guidelines, rules, and regulations relative to the establishment operation and maintenance of various telecommunications facilities and services nationwide.
Although independent, in so far as its regulatory and quasi-judicial functions are concerned, the NTC remains under the administrative supervision of the Department of Transportation and Communication as an attached agency.
Philippine Social Security System SSS
The SSS is funded by salary deductions and employer contributions. Its role is to provide employee with health, disability, retirement, maternity, death and funeral benefits and salary, housing and business loans.
Home Development Mutual Fund HDMF
The birth of the Home Development Mutual Fund (HDMF), more popularly known as the Pag-IBIG Fund, was an answer to the need for a national savings program and an affordable home financing for the Filipino worker. The Fund was established on 11 June 1978 by virtue of Presidential Decree No. 1530 primarily to address these two basic yet equally important needs. Under the said law, there were two agencies that administered the Fund. The Social Security System handled the funds of private employees, while the Government Service Insurance System handled the savings of government workers.
Pag-IBIG membership mandatory for all SSS and GSIS member-employees.
Philippine Health Insurance Corporation PhilHealth
PhilHealth’s role is to ensure sufficient financial access of every Filipino to quality health care services through the effective and efficient administration of the National Health Insurance Program. It is a Government owned and Operated Health Care Corporation. Its main mission is to provide basic health insurance and health care financing to all Filipinos. Funding is provided by the central and local governments and employee
Department of Labor and Employment DOLE
DOLE started as a small bureau in 1908. It became a department on December 8, 1933 with the passage of Act 4121. The DOLE is the national government agency mandated to formulate and implement policies and programs, and serve as the policy-advisory arm of the Executive Branch in the field of labor and employment. It consists of the Office of the Secretary, 7 bureaus, 6 services, 16 regional offices, 12 attached agencies and 38 overseas offices with a full manpower complement of 9,806.
The Alien Employment Visa (AEP) is issued by DOLE.
Technical Education and Skills Development Authority TESDA
The Technical Education and Skills Development Authority (TESDA) was established through the enactment of Republic Act No. 7796 otherwise known as the “Technical Education and Skills Development Act of 1994”, which was signed into law by President Fidel V. Ramos on August 25, 1994. This Act aims to encourage the full participation of and mobilize the industry, labor, local government units and technical-vocational institutions in the skills development of the country’s human resources.
TESDA is mandated to:
Integrate, coordinate and monitor skills development programs; Restructure efforts to promote and develop middle-level manpower; Approve skills standards and tests; Develop an accreditation system for institutions involved in middle-level manpower development; Fund programs and projects for technical education and skills development; and Assist trainers training programs.
Contact Dayanan Philippines Business Consultants now for assistance with Philippine government agencies.
Dayanan Business Consultancy helps foreign companies get their business up and running in the Philippines.
Besides being known for the hospitality and warmth of its people, the Philippines has a promising culture. A developing country that boasts of fluent English speakers, this country is attracting foreign investors for its industrial competitiveness.
Highlighting how doing business in the Philippines can be advantageous but prone to red tape, Dayanan Business Consultancy or DBC assists individuals and foreign companies of all sizes in setting up their business operations in the Philippines.
Through its website, DayananConsulting.com, DBC guarantees to help customers by preparing business plans and obtaining business permits on their behalf. In addition, DBC can provide services for feasibility studies, business plans and real estate studies and consultancy.
Business Registration Incorporation Philippines SEC
Dayanan Business Consultancy explains that its knowledge of the Philippines’ business environment and government agencies allows its clients to reach objectives quickly. The company commits to personalized service for businesses seeking to establish in the Philippines Foreign Ownership of Corporation, a 100% Foreign Owned Domestic Corporation (subsidiary), Representative Office, Foreign Branch Office, Partnership, Sole Proprietorship or Regional Headquarters.
DBC, as a business consultant in the Philippines, will recommend the best structure for BPO, KPO, Call Center, IT or Web Development Outsourcing, Back Office Operation or Import Export. DayananConsulting.com will also advise businesses on how to register their investments with the Philippine Export Zone Authority or the Board of Investments to obtain tax incentives.
Once the Securities and Exchange Commission has issued a License to Transact or Certificate of Incorporation for a business, DayananConsulting.com will still be there to help get local business permits and licenses and register with other government agencies as may be necessary. Other services that DBC provides include Business Development and Marketing, Business Plans, VISA Processing, Bookkeeping and Payroll. The DBC Team also offers free consultation services.
Benefit from Dayanan Business Consulting services to register and obtain Philippine business permits quickly and professionally. Check out https://www.dayananconsulting.com now and learn how business can start operating in the country in no time.
About: Dayanan business consultancy helps foreign companies get their business up and running in the Philippines. They can help customer obtaining business permits and prepares business plans. In addition, the company can provide services for feasibility studies, business plans and real estate studies and consultancy.
Company Contact Information DayananConsulting.com Public Relations Unit 12C, Valero Towers 122 Valero St. Salcedo Village, Makati, Philippines 1227 Phone : +639178125014
Success in the Philippines depends on choosing the right business consultant to assist you in studying the Philippines market and developing the correct market entry strategy. Starting and doing business in the Philippines requires information and knowledge.
DBC specializes in helping foreign companies acquire the specific facts they need to establish their office and find clients and partners. Introduce you to the necessary government agencies to obtain business permits and apply for tax incentives.
Business Plan Consultancy
Whether you are a local or international company DBC’s team of professional consultants has the required expertise to prepare comprehensive Feasibility Studies, Business Planning, Market Entry Strategy Reports, Market Research and Real Estate Development Market Studies.
Business Registration Consultant
DBC has assisted many local and foreign businesses, who wish to start doing business in the Philippines in completing their company registration requirements. Organizing all that is needed to have your Philippines business registration accomplished smoothly and rapidly with the required government agencies. Most companies will need to apply or register with the SEC, DTI, BIR, SSS, Pag-IBIG, and PhilHealth. DBC will explain the different company structures available in the Philippines and advise you on the advantages of each one.
Let DBC be your business consultant in the Philippines