CFA Law Offices

Doing business in the Philippines requires the registration of the business with the proper regulatory agencies.

Single proprietorships have to be registered with the Department of Trade and Industry, while Partnerships and Corporations have to be registered with the Philippine Securities and Exchange Commission (SEC).

We shall discuss the registration requirements for Corporations below.

Under Philippine law, new corporations should have a minimum of 5 stockholders and 5 directors (all of whom should also be shareholders of the Corporation). Majority of the directors should be residents of the Philippines.

Unless the corporation is engaged in a regulated industry, minimum paid-up capital is only PHP5,000 (or US$100). However, in practice, new corporations usually have an initial capital of PHP60,000 (or US$1,200). A local bank will have to be appointed where the initial funds of the Corporation shall be deposited prior to its registration.

The Corporation will also have to elect a President (who must be a director), a Treasurer, and a Corporate Secretary (who must be a citizen and resident of the Philippines).

Foreigners may own up to 40% of a Philippine corporation, except in specific industries regulated by law, such as retail trade, media, advertising, and other nationalized industries, which has a lower maximum allowable foreign ownership. Subject to the said exception, foreigners may own more than 40% of a Philippine corporation if it is engaged in an export enterprise where more than 60% of its products are exported out of the Philippines, or if the initial paid-up capital of the Philippine Corporation is at least US$200,000.

The Corporation is usually registered within 3 to 7 days upon submission of the complete documents with the SEC.