Categories: Personal Finance

Self-employed in the Philippines – Which requirements must be fulfilled?

When it comes to money or business, Filipinos can be a little less welcoming. Understandably, because the Philippines is still a poor country, and many work daily to survive and not just to live. However, some foreigners have managed to establish themselves in the Philippines. Sometimes just a good idea is enough and also a portion of luck in the business belongs to it. But happiness is not a reliable partner. I don’t want to dissuade you from doing business in the Philippins. It is possible!

Emigrants who cannot fall back on any monthly reserves usually go the way of setting up a business. In order to simplify many things, this way is often not gone alone. Often this step is made with the marriage of a Filipino woman. This, of course, simplifies legal matters.

Self-employment in the Philippines is a great challenge

It is a popular method to get married in the Philippines, become self-employed and let the project run through the wife. In the worst case, however, you will find the wrong wife, who will divorce again after a few years, get the joint fortune and make you return home as a destitute loser. An experience that I have seen often enough.

Especially “experience” (if possible one’s own) is almost like a prerequisite to cope with the upcoming difficulties. By that I mean:

  • Establishing contacts and a good relationship with local employees, companies, their work attitude, behaviour and punctuality.
  • Dealing with authorities, offices, institutions. As well as the danger of corruption.
  • Understanding the legal system, culture and laws.

Those who have not had these experiences are, according to many predecessors, doomed to failure.

A patent solution, on the other hand, is not mentioned. Or would one like to make voluntarily bad experiences, only to have made these? So what we can do is to prepare ourselves accordingly in order to exclude as many risks as possible. For my part, I have previously read through many reports of experiences of failed existences.

The following is a brief overview of the possible forms of business in the Philippines (as of 2016).

  1. Sole Proprietorship. Responsible for this is the DTI (Department of Trade and Industry). Information on registration/application on request.
  2. Partnership. General or Limited Partnership – The SEC (Securities and Exchange Commission) is responsible for this. Further information can be found in the Citizen´s Manual on Registration of Corporations and Partnerships.
  3. Corporation. Stock and Non-Stock Corporation. The SEC is also responsible for details in the Citizen´s Manual on Registration of Corporations and Partnerships.
  4. Foreign Corporations. Branch Office, Representative Office, Regional Headquarters and Regional Operating Headquarters, as well as the non-stock version of the Branch and Representative Office. The SEC is also responsible for this, as is the simple information contained in the Citizen´s Manual on Registration of Corporations and Partnerships.

The “10 Regular Foreign Investment Negative List”, which defines foreign investments in the Philippines, is important when setting up a business.

Further assistance is available from the lawyer of your choice or directly from DTI or SEC.

Helpful information on how to open a business: Negosyong Pinoy

In order to get tax reductions and benefits, it is also helpful to read the BOI (board of Investments) under DTI settled. Designed for the introduction of new inventions.

For patents contact the Intellectual Property Office of the Philippines.

An alternative would be to apply for a company in the Philippines.

The Value Geek 2019