Foreign Investors: How to Incorporate a Company in the Philippines in 2025

The Philippines continues to attract foreign investors in 2025, thanks to its young, English-speaking workforce, rapidly growing digital economy, and strategic location in Southeast Asia. Whether you're looking to tap into the local consumer market or establish a regional office, understanding the process of company registration in the Philippines is key.

This comprehensive guide breaks down the steps, legal requirements, and strategic considerations for foreign company registration in the Philippines, making your business setup in the Philippines smooth, compliant, and successful.

Why Set Up a Business in the Philippines in 2025?

Foreign companies are increasingly drawn to the Philippines for several reasons:

• Strong Economic Growth: The country has maintained resilient GDP growth, even amidst global slowdowns.

• Skilled Workforce: Over 60 million of its population is under the age of 35, with high English proficiency and digital skills.

• Improved Infrastructure: Government projects like “Build Better More” enhance connectivity and logistics.

• Favorable Investment Policies: Recent reforms have relaxed foreign ownership restrictions in key sectors.

1. Choose the Right Business Structure

Foreign investors can choose from several legal entities when setting up in the Philippines:

A. Domestic Corporation

• Allows up to 100% foreign ownership depending on the industry.

• Requires at least 5 to 15 incorporators, each holding at least one share.

• A popular structure for those planning long-term operations.

B. Branch Office

• Acts as an extension of the parent company.

• Can engage in income-generating activities.

• Subject to the same taxes as domestic corporations.

C. Representative Office

• Limited to non-income-generating activities (e.g., marketing, support).

• Ideal for market research or liaison functions.

D. One Person Corporation (OPC)

• A newly introduced structure.

• Available to foreign individuals or corporations.

• Simplified governance but ownership limits apply depending on industry.

Tip: Use the Philippine Foreign Investment Negative List to check sector restrictions for foreign ownership.

2. Secure Business Name Approval

Before proceeding with registration, secure your business name through the Securities and Exchange Commission (SEC).

• You can do this via the SEC’s online Company Registration System (CRS).

• Ensure the name is unique and not deceptive or inappropriate.

• For sole proprietorships, the Department of Trade and Industry (DTI) handles name registration.

3. Meet Capital Requirements

Depending on your entity type and sector, minimum capital requirements vary:

Note: Capital can be lowered for businesses that export at least 60% of goods/services or engage in specific industries like tech startups or renewable energy.

4. Register with the SEC

For corporations, branches, and representative offices, the SEC is the main registering authority.

You’ll need to submit:

• Articles of Incorporation and By-Laws

• Name verification slip

• Treasurer’s affidavit

• Proof of inward remittance (for foreign equity)

• Endorsements (if operating in regulated industries)

Processing time: Around 3–5 business days if all documents are complete.

Also Read: Post Registration Compliances for Company Limited by guarantee formation in Singapore

5. Obtain Local Business Permits

After SEC registration, the next step in your business setup in the Philippines is securing local government unit (LGU) permits, which include:

• Barangay Clearance

• Mayor’s Permit / Business Permit

• Zoning Clearance

• Fire and Sanitary Permits

These are required before starting operations and must be renewed annually.

6. Register with the Bureau of Internal Revenue (BIR)

To comply with tax laws, register with the BIR and:

• Obtain a Tax Identification Number (TIN)

• Register your books of accounts

• Print official receipts and invoices

• Apply for VAT if gross sales exceed PHP 3 million annually

Failure to register within 30 days from the start of business can result in penalties.

7. Register with Other Agencies (If Applicable)

Depending on your industry and employee count, you may also need to register with:

• PhilHealth (health insurance)

• SSS (Social Security System)

• Pag-IBIG Fund (housing benefits)

• PEZA/BOI (if seeking tax incentives)

8. Hire Employees and Comply with Labor Laws

Once registered, you can begin hiring staff. Be aware of key labor laws:

• Maximum of 8 working hours/day

• 13th-month pay (mandatory)

• Paid leave entitlements

• Government-mandated benefits

The Philippines has strong labor protections, and proper compliance boosts your brand reputation and reduces legal risks.

9. Open a Corporate Bank Account

Most banks require the following:

• SEC Registration

• Articles of Incorporation

• Board Resolution (for opening account)

• Two valid IDs of signatories

Some banks now offer digital onboarding for corporations, streamlining the company registration in Philippines process.

Also Read: Documents Required for Private Limited Company Formation in Singapore

10. Consider Incentives and Special Zones

To make your investment more profitable, consider registering with the Philippine Economic Zone Authority (PEZA) or the Board of Investments (BOI).

Benefits Include:

• Income tax holidays (ITH)

• Duty-free importation of capital equipment

• Special non-immigrant visas for foreign employees

• Streamlined customs processes

This is highly recommended for export-oriented, IT, or manufacturing firms.

Common Challenges for Foreign Investors

• Bureaucratic delays: Although digitalization has improved, some processes still involve manual steps.

• Changing regulations: Tax, labor, and sector-specific rules may evolve quickly.

• Language & cultural nuances: English is widely spoken, but local business customs still apply.

Working with a local legal or consulting firm can significantly ease your foreign company registration in Philippines.

Conclusion

The business setup in Philippines for foreign investors has become more streamlined and accessible in 2025, with pro-investment reforms and expanding digital tools. Whether you’re planning to start a call center, tech company, import-export business, or regional branch office, the opportunities are vast.

By understanding the process of company registration in Philippines—from choosing the right structure to complying with tax and labor rules—you can minimize risks and focus on scaling your business in one of Asia’s most promising markets.

FAQs

1. Can a foreigner own 100% of a company in the Philippines?

Yes, in many sectors—especially export-oriented businesses and certain service industries—foreigners can own up to 100% equity. However, ownership is limited in sectors on the Foreign Investment Negative List.

2. How long does it take to complete foreign company registration in the Philippines?

If all documents are prepared, company registration in Philippines typically takes 4 to 8 weeks, including SEC registration, BIR, local permits, and opening a bank account.

3. Do I need to be physically present to set up a business in the Philippines?

While physical presence helps, it’s not mandatory. You can appoint a local representative or lawyer with a Special Power of Attorney (SPA) to handle the registration process on your behalf.