How to Establish Your Business in the Philippines

Type of company:

• Foreign Branch
• Foreign Representative Office
• 100% fully foreign owned Domestic Corporation
• 60/40 owned Domestic Corporation

There are available consultancy firm that can assist and help assess those who need investment vehicle best for the owner and the company. Such services will be provided:

• Procedure
• Planning
• Registration to relevant Philippine government agencies (e.g Securities and Exchange Commission, Department of Trade and Industry, Bureau of Internal Revenue, etc.)

Added services will be as follows:

• Determine Capital Requirement
• Assist in the opening of local bank account
• Register and secure company name with Securities and Exchange Commission or with Department of Trade and Industry
• Identify Shareholders, Directors, Nominees and Incorporator
• Draft Articles of Incorporation and By-Laws
• Process documents with Securities and Exchange Commission, Board of Investment, Philippine Economic Zone Authority, Bureau of Internal Revenue, Social Security System, etc
• Process Mayor Permit and Business Permit
• And whole lot more depending on capacity of the firm and where in the Philippines it is intended to establish its office/s.

Please be advice to get only credible and honest consultancy firm to avoid loss of time and money. The consultancy firm will also mention the existing realities and limitation with concerns to facility, national economic status, negative reports and things to expect.

Eligible businesses may then register their businesses with Philippine Economic Zone Authority, Board of Investment, etc. Incentives such as income tax holidays and special tax regimes are available to foreign investment.

Most foreign investors usually start through a Domestic corporation or a Branch. We recommend to register as corporation as there are administrative regulations. Branches, which may be more advantageous tax wise, cannot be used if the activities to be undertaken are included in the Foreign Investment Negative list. Corporations can accommodate Philippine ownership.

Forming or registering a corporation has to comply with the following requirement:

• Minimum of 5 incorporator, each of whom must be actual persons and hold at least a single share in the company.
• Majority of the incorporator must be Filipino.
• A Corporation must have between 5 and 15 directors, each of whom must have at least one share of stock.
• Majority of the directors (or trustees) must be Philippine residents.
• All Domestic Corporations (those incorporated in the Philippines) must obtain their license with the Securities and Exchange Commission
• Philippine Securities and Exchange Commission requires the following:

- Has to reserve and register a company name
- Has to submit proposed Articles of Incorporation and By-Laws in compliance with the Corporation Code of the Philippines
- Proof of minimum capitalization required to every industry or business the corporation is engaged in
- Has to have the minimum paid-up capital requirement for a corporation or where the foreign equity exceeds 40% is US$200,000, which must be remitted into the Philippines
- Must employ at least 50 employees.

All other details related to start-up, branch establishment and export oriented firms will be explained further by the consultancy firm. The issuance of a certificate of incorporation from the SEC signifies the commencement of corporate existence and juridical personality for a company.

Businesses must also register with the following agencies:

• Bureau of Internal Revenue
• Social Security System
• Home Development Mutual Fund
• Philippine Health Insurance Corporation
• And the local government unit where its principal office will be located.

If the business wish to operate as sole beneficial owner of the business, it should be registered to the Department of Trade and Industry and with the Beureu of Internal Revenue and must also register its business name with the Department of Trade and Industry through the Bureau of Trade Regulation and Consumer Protection.

Other details will be explained further by the consultancy firm or the entrepreneur. You can inquire directly to Department of Trade and Industry.

Vicky Wallace and Her Bee Farm in Bohol Philippines

Image is excerpt from Google Images

Who would have thought that a high earning US base Filipino Nurse and a mother would trade all she owned in America, in exchange of her one chance to establish a community building organic farm in Bohol Philippines. Better known as Bohol Bee Farm.

The lady in the spot light is “Vicky Wallace,” a New York based nurse-turned-farmer.” I loved what she said…

“You make good money in the States but you have to ask yourself what is it all about.” I had three jobs. I hardly saw my kids. So after the school year there ended, I brought them here.”

She also said that returning to the Philippines to start a business was one of the best decisions she made in her life.

Rough Start for Vicky

As always, the non-traditional are the ones persecuted for their unorthodox vision. It was when Vicky’s husband died in 1988. She began to rethink of her priorities as a mother and in life. As mentioned, it wasn’t an easy decision to make. Nonetheless, Vicky was firm on her decision, no matter what other people said. Let me quote her mother’s own words, , ‘Why are you dragging your kids to the Philippines, ‘as if it was a bad thing,” she relates. Good thing Vicky did not give up. Now, Bohol Bee Farm is a blessing not just to her family but to the whole province of Bohol as it also attracts tourist and it branch out to other possibilities and entrepreneurial opportunities. Let me again quote another words of Vicky…

“But I never regretted my decision. What kept me going was the thought that I didn’t want to live a life where my children grew up not knowing who I was because I was always working, and later their children would grow up the same way.”

“What kept me going was the thought that I didn’t want to live a life where my children grew up not knowing who I was because I was always working, and later their children would grow up the same way.”

Vicky bought lands where she invested some of her earned money, of which they settled in of it. She started selling vegetables to her children’s classmates. Later the parents married to foreigners went to the farm themselves and harvest their preferred vegetables. She also expanded to homemade bread. Her success in homemade bread starts when she baked breads that suits customer’s tastes. She observed that foreigners don’t like it sweet. In the contrary, locals love their kamote bread, which is slightly sweeter. Bee Farm’s herb bread is a hit to foreigners and hopes to win Filipinos tastes soon. There’s no stopping this lady as she also offered muffins and crafts, something she learned in the US.

More of Bohol Bee Farm on their site…

http://www.boholbeefarm.com/