Are foreigners allowed to establish a business in the Philippines

Thank you so much mate. This information helps heaps.

Thank you so much mate. This information helps heaps.

9ballmark wrote:

Hi Nick
what type of business are you interested in? Is it just internet cafes or are you interested in Billiard/Disco/Karaoke/Resto bar?
I have 25 years of experience in this industry although wet behind the ears as far as the Philippines is concerned. I have a friend that has been here 4 years and started a bar but in a very bad area, it was more of a hobbie for him than a money making plan.

Where are you from originally?

regards

Mark

Sounds like a reasonable idea to set up a a bar, but you have to remember most foreigners won't support you as most are tucked up in their bed by 8pm. The very few who might support you are probably the type you don't really want hanging around. Unless you are prepared to fork out a large amount of dosh to set up a decent bar and import western food etc, stick to the local trade, cater solely for the Filipino. Many Karaoke bars are struggling these days..The hours are long. Noticeably higher rents see many bars come and go all within 12 months. Maybe a karaoke bar or the likes, in the provinces, might increase the chance of survival, i'm not sure. A couple of friends are contemplating closing their bar for the above reasons. They have been in business for many years and have decided to move on, simply because of a substantial increase in their rent. Currently business confidence here in the Philippines is excellent, but choosing the right business can be the key to success.
My advice is if you are thinking of moving to the Philippines without having access to a steady income, as in having a 'pension or substantial savings' or both, life may be pretty miserable for you.

tony694 wrote:

Hi professor cebu,
Thanks for the reply.
I want to open a bar with a small gaming area (about 20 slot machines) in Puerto Princessa. I want to start a genuine business and in the future help the community. I need advice. I like the Philippines. I'm not planning to just making money there, but to live as well. Would you have any ideas on that matter? Any advice would be greatly appreciated.
Thank you

Government agencies you have to deal with:
1. for gambling machines-PAGCOR and City Hall
2. Business permits-City hall
3. building permit-OBO
4. tax registration-BIR
5. for more info on labor - DOLE
6. business registration: sole/partnership-DTI; corporation-SEC

Hope this helps. for your additional info, there is one particular philippine law that grants income tax holiday incentives which is also processed together with application for business registration

@ Raggz,

A few months back you asked what is a BPO?  Since there were no replies, my response follows with a few key terms:

1.  BPO =  Business Process Outsourcing, aka Call Center or IT-BPM.  A person would need to focus on a sub-sector that they would want their company to be built for. 

Again, foreigners need to know and complete registration with such entities as PEZA, DTI-BOI, and the SEC.

2.  It is best to learn about:

DTI-BOA = The Board of Investments (BOI), a regulatory branch of the DTI.

PEZA = Registering with PEZA (Philippine Economic Zone Authority) is necessary and once registered, "PEZA provides incentives to foreign-owned businesses who operate in economic zones, such as specific tax exemptions for three to eight years."

3.  Legal capacity to work & work Visas - To be clear, time, research and focus must be done at the BI as it is expected that the BPO will bring in foreigners or will be formed by foreigners who will manage the BPO business in the Philippines.  Therefore, the BPO owners/managers will need to secure working visas for them. 

4.  Organizational & Management structures - The BPO business registration, by-laws and articles of incorporation will need to be in order regarding the fact that the foreign nationals to be hired will be taking over managerial, executive, technical, or highly confidential positions in the BPO company.

Prior to preparing our corporation by-laws and AOI, we considered this route but the massive amount of time just developing a sound business plan, securing a viable US customer base, special preparation needed for the B-Y/AOI, along with ROI vs. capital investment calculations was not a fit for our humble start-up.

YMMV

Hi,

You can start a food business. Food stall.

Thanks

@Tintin,

You should understand that a "foreigner" must be in compliance with many laws/rules including the Retail Trade Liberalization Act (RA8762).  Simply put, "Foreigners are not to be involved in retail trade enterprise with a paid-up capital of less than USD 2,500,000" and must follow "Category B" to form an legal enterprise.  This part of the RA states:

"Category B – Enterprises with a minimum paid-up capital of the equivalent in Philippine Pesos of two million five hundred thousand US dollar (US$2,500,000.00) but less than Seven million five hundred thousand US dollars (US$7,500,000.00) may be wholly owned by foreigners except for the first two (2) years after the effectivity of this Act wherein foreign participation shall be limited to not more than sixty percent (60%) of total equity."

Most expats are not going to place 2.5 Million+ USD into a foreign system just to open a simple retail trade enterprise (such as the eatery/food stall you suggest), even if they had such an amount.  The failure to post the 2.5M+ USD and structure as required to own/operate such an enterprise by an expat is a clear violation of RA8762.    https://www.lawphil.net/statutes/repact … _2000.html

Other areas of business include:  "Foreign nationals are also not allowed to join or form cooperatives, get involved in small scale mining, owning cockpits, manufacture, repair, or distribute nuclear, chemical, biological, and radiological weapons, firecrackers, and pyrotechnic devices".

Of potential interest to some expats is the updated 11th Foreign Investment Negative List awaiting the president's signature since 23 July 2018.  http://primer.com.ph/blog/2018/07/23/11 … -approval/

The draft reports to relax the foreign ownership paid-up capital restrictions including a reduction from 2.5M USD to a mere 200K USD.

I am still confused.
can a retail business be started by incorporating a corporation (40-60 ratio)????

1.  Yes, if you have USD 2,500,000 or more and you comply with the latest Foreign Investment Negative List!

This answer is based on: "Foreigners are not to be involved in retail trade enterprise with a paid-up capital of less than USD 2,500,000" and must follow "Category B" to form an legal enterprise."

2.  No, if you do not have at least USD 2,500,000!

3.  No, (regardless of capital) if you do not comply with the latest Foreign Investment Negative List.

4.  Maybe, based on 1 or 2 above and the corporate structure of 100%,  60/40%, 70/30% or other % foreign ownership ratios due to your core business the latest Foreign Investment Negative List.

In the following types of business, can a foreigner start with 60/40 corporation and less than USD 2.5m:

1. Export business
2. Sari sari store

first of all congratulations on starting a business. My advise is to start an online business. Also, read the book, "Ready or Not, the six major business Disruptors" by Philippine entrepreneur Marlow forgot last name. available on Kindle.

I have created a cell phone entertainment app company that has a YouTube presence. More millionaires will be created by entrepreneurs creating online businesses.

Like me know what you decide to do and good luck. Craig Cothren. I am on Facebook.

I am interested in starting a assisted living center for foreigners of German, or English or Japanese or Mandarin speaking ability because many people in English/German speaking countries can not easily afforded assisted or nursing home fees in their own countries. Contact me if you or anyone has an interest in creating such a center on the island of Bohol or Cebu.

Just go to the DTI Web Site Department of Trade and Industry will show you a list of businesses you can own 100% of $40% of 30% of and some where you will not be able to invest in https://www.dti.gov.ph

Here is another link http://www.chanrobles.com/default3.htm#.W9_3zC2B1Z0

My 2 cents get a business that is not regulated so much  like sari sari or fishing boat rent farm with trees or piggery pisonet depends where you are these ideas are good in province city ideas could be buy sell online also vape shops small restaurant or food cart you want a cash business dont bother with franchises and other businesses unless you willing to register a company and pay taxes

Mabuhay, Kumusta ka? You are absolutely right. Family comes first no matter what and that's why I love the Philippines and the culture. Canada was like that many years ago but not anymore unfortunately and this is why I plan on moving to the Philippines.. Women act like women in the Philippines not like men. Their is a bad stigma for no reason & not all Filipina's are after just money but after true love and find a man that respects them and loves them unconditionally and doesn't drink 24/7. I am looking into opening a Convenience store in the Philippines and maybe a call center that will give jobs to the Philippine people. I want to make a difference in the Philippines, cheers.

Curious about the online business approach! I'm planning on moving to the Philippines and will be living with my girlfriend who is 100% Filipina..Online would be a whole lot easier then any other business. Where do I start  to actually create a online business, love the idea..Steady income equals happy life. Cheers.

You really need to consider your location and the ISP (internet service provider) here.  So many places will not have the best speeds and the main ISP (PLDT) will alter and change your router settings every 24 hours unless you make then aware of the fact you are indeed watching them.  Also you will need to learn or refresh your understanding of internet vs, intranet speed settings. 

The default speed testing here is from your home to the city of Makati or Imus.  This means you will get false high speed results (UP & Down) with a Ping of less than 7MS.   Since a 200 MS Ping or higher is considered a poor performing circuit, they will quickly tell you it is a problem in the USA. 

When I set my speed test to check a server between the Philippines and Los Angeles, I get a Ping of 175+ MS instead of the 5-7MS test results when the test is only in this country.  The expat needs to understand this if an internet related business capability is your goal.  I required a decent speed to support my post-grad studies back to my California University and my other IT activities here.

After a year plus set of letters to them (PLDT), they turned my speed up (remotely thru the router) to match true "internet" service and now with fiber service,  I'm close to the 50Mbps I pay for.

Lastly, consider a more robust router from the US and bring it with you.  I connect my AirPort Extreme and 2TB Time Capsule to my PLDT router and have zero issues on the Apple side (iMac, MB Pro and iPhones).  I do understand Apple has discontinued these devices but I'm happy with years of trouble free performance with them. Im not into PCs much so I can't recommend hardware there.  Nonetheless, if you run many devices thru the PLDT router you will be in a constant reset mode.  I posted over a year ago in detail on this issue....  best of luck!

Perfect reply. The undercurrents need not be voiced here!

I really agree with you karren. Its almost true that most of the Filipinos are family united and they are really sweet. I also have a girlfriend from Tacloban. I have almost visited 3 times to Philippines and its really sweet of her and her family even their economic condition is not so good but they always tried that i should not invest too much on them .

There are always both the sides of the coin. yet she is jobless now but even that she was not willing to accept any financial help from me. Hope the ones who have faced issues before really had a bad luck or Bad choice.

Best advice is to don't start any business in the Philippines.  I've known literally 100s of foreigners in the Philippines and none who've started any kind of business is above water.  Better to just relax in the Philippines without the headaches of a business.

Hi, I just want to ask your opinion about getting into a multi level marketing business. I have a friend who started their Multi-level marketing here in the Philippines. They just started last March and their product is about Collagen and other franchising (to follow).

Now I want your honest opinion, because I have this feeling that this business will boom in no time. But do you think it is good to be a member of this business? The minimum entry fee is Php 5,000 only the maximum is 100K with money back guaranteed and I would be able to sell the products or the business itself.

By the way, my friend is one of the founder so she promise me to teach how to do the business that's why it entice me.



Thank you so much in advance
Tintin

Calif-Native wrote:

You really need to consider your location and the ISP (internet service provider) here.  So many places will not have the best speeds and the main ISP (PLDT) will alter and change your router settings every 24 hours unless you make then aware of the fact you are indeed watching them.  Also you will need to learn or refresh your understanding of internet vs, intranet speed settings. 

The default speed testing here is from your home to the city of Makati or Imus.  This means you will get false high speed results (UP & Down) with a Ping of less than 7MS.   Since a 200 MS Ping or higher is considered a poor performing circuit, they will quickly tell you it is a problem in the USA. 

When I set my speed test to check a server between the Philippines and Los Angeles, I get a Ping of 175+ MS instead of the 5-7MS test results when the test is only in this country.  The expat needs to understand this if an internet related business capability is your goal.  I required a decent speed to support my post-grad studies back to my California University and my other IT activities here.

After a year plus set of letters to them (PLDT), they turned my speed up (remotely thru the router) to match true "internet" service and now with fiber service,  I'm close to the 50Mbps I pay for.

Lastly, consider a more robust router from the US and bring it with you.  I connect my AirPort Extreme and 2TB Time Capsule to my PLDT router and have zero issues on the Apple side (iMac, MB Pro and iPhones).  I do understand Apple has discontinued these devices but I'm happy with years of trouble free performance with them. Im not into PCs much so I can't recommend hardware there.  Nonetheless, if you run many devices thru the PLDT router you will be in a constant reset mode.  I posted over a year ago in detail on this issue....  best of luck!

Do you have a link to your more detailed post?

tintin122576 wrote:

Hi, I just want to ask your opinion about getting into a multi level marketing business. I
Tintin

Very easy question to answer.

If you're on or near the top of the tree, you'll make a fortune. The downside is you have to have no conscience about ripping people off and you'll go to hell

If you're at the bottom or quite low, you'll get scammed in an epic way.

If a friend has introduced you to this, delete their number and ghost them - They're no friend if they're trying to scam you.

There's actually a product to sell she said that you have a choice to sell the products or do the business.

Multi level business is for bandit ! No heart just money !

tintin122576 wrote:

Now I want your honest opinion, because I have this feeling that this business will boom in no time. But do you think it is good to be a member of this business? The minimum entry fee is Php 5,000 only the maximum is 100K with money back guaranteed and I would be able to sell the products or the business itself.

By the way, my friend is one of the founder so she promise me to teach how to do the business that's why it entice me.



Thank you so much in advance
Tintin

Most such businesses boom the first 6 months-year for the people in on the ground floor.  Multi level means the new suckers pay the old ones.  A few will make some money, everyone else will lose.  Often people can only make money if they recruit others, but the new recruits must also recruit other ad infinitum.  Don't expect  to keep any friends you introduce to this business.

Thank you for your advices.

I forgot to mention that they have a money back guaranteed due to those members that won't be able to invite to earn. Its a profit sharing from the company. Do you think this is still bad company? I'm asking because its sounds good to me but want ur opinion still before i join. Thank you again.

I wouldn't go near them regardless of what they say.
MLM is MLM, and that always means it's a bad idea.

The only people that push MLM scams are MLM scammers, so everyone with a brain tells them to get lost.

All MLM are set up so that selling the product won't make a profit, you are just feeding the higher ups from your savings.

Ok will take note of that. Thank you

cuales son esos requisitos?

josekite wrote:

cuales son esos requisitos?

English please.

mugtech wrote:

josekite wrote:

cuales son esos requisitos?

English please.

It's Filipino ((or perhaps Spanish)). I can a bit of both but not enough to judge which of them it is     Filipino has got many words from Spanish.

It mean - What are the requirements?

Well.  It depend much of what you aim at doing and if corporation or what business form.
There are more restrictions and forbids against foreigners, but there are some for Filipinos too. Some unexpected ones too     as e g demand to fast geting special printed both invoices and reciepts even if never will be a situation to use!   
Some of these restrictions are about max owning for foreigners from 100 % to nothing depending of what the business will do.  Max 40 % is the common, but 100 % for "export business" where the main of the income come from abroad.

...

Supposedly an all English forum, language-wise.  Jose can go fly a kite.

Yes! and Jose be sure to grab a diving rod and hang on to the tail of the kite! Say hi to old Ben Franklin when you see him!

Jesus gave a guarantee he was coming back to LOL

cogon88 wrote:

Jesus gave a guarantee he was coming back to LOL

Well if Jesus comes back will MSNBC, CNN or Fox news ask him if he was here before? Also will social media allow his named to be mentioned?

mugtech wrote:

Supposedly an all English forum, language-wise. .

For clarity and ease of use, English should be used on this section of the forum.
Posts in other languages may be removed

Spanish, if anyone is interested, is here

https://www.expat.com/forum/viewforum.php?id=2198