November 19, 2013 | Valerie Wong
Previously, doing business in the Philippines as a foreigner wasn't always easy, as there were numerous restrictions on foreign ownership of corporations. However, this has recently changed with the liberalization of laws related to foreign investments in the country. Anybody, regardless of their nationality, may now start a business in nearly any sector, with a few exceptions that are reserved for Filipinos.
The local government fully realizes that foreign investment is necessary for the country to prosper and as such, has made numerous efforts to promote it. Foreign entrepreneurs are now encouraged to come and set up shop in the country, as this helps provide much needed capital, allows for increased local employment, plus helps with the overall development of the country.
Registering a corporation in the Philippines has also gotten easier in the last few years. Anybody interested in setting up a new company will need to follow some steps before they can begin their activities. This includes reserving a business name with the Securities and Exchange Commission, opening a corporate bank account in which the paid up capital will be deposited, registering the new corporation with the SEC and finally registering with the Bureau of Internal Revenue. Companies that will hire local workers will need to register with the Social Security System, the Pag-Ibig fund and Phil-Health. In some areas, a local permit must be issued for the location in which the business will be located.
While the process may long and arduous at first, it is actually a lot simpler than it appears. Starting a new corporation can usually be done under a month. Those who have never done business in the country before could seek the assistance of a qualified local firm that can help them navigate through the entire registration process.
Foreigners that come to the country will notice that there are numerous business opportunities available to them. Some may prefer to set up relatively simple businesses, such as restaurants, bars and retail shops. As tourism is growing, not only in the Philippines but also in the surrounding region, many foreigners are now interested in opening establishments that cater primarily to people visiting the country, such as resorts. To make things easier, the law related to foreigners leasing land has recently been changed as well. In the vast majority of cases, foreign nationals are not allowed to own land in the country. However, they are allowed to enter into a lease agreement with a local land owner. One thing to know is that for any project related to tourism in which a foreigner will lease land, the minimal investment amount is of $5 Million US Dollars.
Of course, many other types of businesses may be started by foreigners in the country. As the Philippines has a well-educated workforce, many companies that provide online services have come to the country. Firms that offer SEO services, as well as online marketing and media agencies are becoming extremely popular. They costs of setting up and running an online business in the Philippines will often be much lower than in the United States or Europe. The country's capital, Manila, has a highly developed business district with a very reliable infrastructure, plenty of modern offices available for lease, plus an overall business culture that is similar to what you would see in the United States.
If you want to set up a new business in the Philippines, Servcorp's services can be very helpful. They provide assistance with the business registration process and also virtual offices, meeting rooms and serviced offices found in the nation's capital.