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The Philippine government has created several areas for investment opportunities for
locals and foreigners. To avail of the following incentives, foreign investors must have
qualified enterprises that can be registered with the Board of Investments (BOI) under
the Omnibus Investments Code (OIC).
Businesses registered under the Philippine Economic Zone Authority (PEZA) are also
eligible for the following tax and non-tax incentives.
Before a foreign investment can engage in business in the Philippines, it must first
secure the necessary licenses or registration certificates from appropriate government
agencies. Generally, the registration process starts with the Securities and Exchange
Commission (SEC).
If the proposed project or activity qualifies for incentives, the foreign investor may file its
application with the appropriate government agency depending on the project’s location.


a. Any non-Philippine national may do business or invest in a domestic enterprise up to

one hundred percent (100%) of its capital provided:

(1) it is investing in a domestic market enterprise in areas outside the FINL; or

(2) it is investing in an export enterprise whose products and services do not fall
within Lists A and B (except for defense-related activities, which may be
approved pursuant to Section 8(b)(1) of the Act) of the FINL.

Provided further that, as required by existing laws, the country or state of the applicant
must also allow Filipino citizens and corporations to do business therein.

b. Non-Philippine national qualified to do business per paragraph (a) above, but who will
engage in more than one investment area, one or more of which is in the FINL, may be
registered under the Act. However, said non-Philippine national will not be allowed to
engage in the investment areas which are in the FINL.

c. Existing enterprises, which are non-Philippine nationals at the time of effectivity of the
Act and which intend to increase the percentage of foreign equity participation under the
Act, beyond that previously authorized by SEC, shall be governed by the qualifications
in item (a) above. Thus, existing enterprises shall be allowed to increase the percentage
share of foreign equity participation beyond current equity holdings only if their existing
investment area is not in the FINL. Similarly, existing enterprises engaged in more than
one (1) investment area shall be allowed to increase percentage of foreign equity
participation if none of the investment areas they are engaged in is in the FINL.

Existing foreign corporations shall be allowed to increase capital even if their existing
investment area is in the FINL.

Transfer of ownership from one foreign company to another shall be allowed even if the
enterprise is engaged in an area in the FINL as long as there is no increase in the
percentage share of foreign equity.


a. Filing of Application. Applications for registration shall be filed with the SEC in the
case of foreign corporations and domestic corporations or partnerships which are non-
Philippine nationals. In the case of single proprietorships, applications for Metro Manila
shall be filed with the BTRCP or the DTI-National Capital Region. In the provinces,
applications may be filed with the extension offices of the SEC for
corporations/partnerships and the provincial offices of the DTI for sole proprietorships.

b. Pre-Processing of Documents. Pre-processing of documents shall be under taken to

assist the investor in determining the completeness of his documents. All applications
are considered officially accepted only upon submission of complete documents to
either the SEC or BTRCP. Applications for clearances from the Department of National
Defense (DND) or Philippine National Police (PNP) for defense-related activities, or the
DOST for investments involving advanced technology shall be decided upon by said
agencies within fifteen (15) working days.

c. Approval. Within fifteen (15) working days from official acceptance of an application,
the SEC or BTRCP shall act on the same. Otherwise, the application shall be
considered as automatically approved if it is not acted upon within said period for a
cause not attributable to the applicant.


a. Existing Requirements.

As required by laws and regulations, an application form together with the following
documents shall be submitted to the SEC:

(1) In the case of a new domestic corporation or a partnership:

(i) Articles of Incorporation/Partnership

(ii) Name Verification Slip

(iii) Bank Certificate of Deposit

(iv) ACR/ICR, SIRV (Special Investors Resident Visa), Visa #13 of the alien

(v) Proof of Inward Remittance (for non-resident aliens)

(2) In the case of a foreign corporation:

(i) Name verification slip

(ii) Certified Copy of Board Resolution authorizing the establishment of an office

in the Philippines; designating the resident agent to whom summons and other
legal processes may be served in behalf of the foreign corporation; and
stipulating that in the absence of such agent or upon cessation of its business in
the Philippines, the SEC shall receive any summons or legal processes as if the
same is made upon the corporation at its home office.

(iii) Financial statements for the immediately preceding year at the time of filing of
the application, certified by an independent Certified Public Accountant of the
home country.

(iv) Certified copies of the Articles of Incorporation/Partnership with an English

translation thereof if in a foreign language.

(v) Proof of inward remittance such as bank certificate of inward remittance or

credit advices.

For representative offices, the amount remitted initially should be at least


If the paid-in equity/capital is in kind, additional requirements shall be submitted

to the SEC pursuant to its existing rules and regulations.

All documents executed abroad should be authenticated by the Philippine

Embassy or Consular Office.

(3) In the case of an existing corporation intending to increase foreign equity

participation, all documents required of the proposed transaction under applicable laws,
rules and regulations shall be submitted.

b. Additional Requirements.

As required by the Act, the following shall also be submitted to SEC:

(1) For enterprises wishing to engage in defense-related activities, clearance
from the DND or PNP.

(2) For small and medium-sized domestic market enterprises with paid-in equity
capital less than the equivalent of US$200,000 but not less than the equivalent
of US$100,000, a certificate from the DOST that the investment involves
advanced technology, or a certificate from the appropriate Department of
Labor and Employment (DOLE) Regional Office that the enterprise has
issued an undertaking to employ at least 50 direct employees shall be

The DOLE, through its Regional Offices, shall validate and monitor compliance
by the investor to the undertaking that it will hire at least 50 direct employees
within six (6) months from the start of commercial operations. Non-satisfaction of
the undertaking shall be reported by the DOLE Regional Office to the SEC, which
shall cause the investor to satisfy the appropriate higher investment requirement,
with penalty for failure to satisfy the undertaking.

(3) For former natural born Filipinos wishing to engage in investment areas allowed to
them under this Act, the following documents are required:

(i) Copy of birth certificate

(i.1) Certified by the local civil registrar or the National Statistics Office (NSO); or

(i.2) For those born abroad, certificate of birth from the appropriate government
agency of the country where the birth is recorded showing the father or mother to
be a Filipino at the time of birth or if the citizenship of the parents is not indicated,
additional proof that the parent/s is a Filipino citizen or has not lost his/her
Filipino citizenship at the time of the applicant investor’s birth;

(ii) Those born before 17 January 1973 of Filipino mothers must

additionally submit all of the following: certified true copies of his/her
sworn statement of election of Filipino citizenship, oath of allegiance from
the civil registrar where the documents were filed and/or forwarded, and
identification certificate issued by the Bureau of Immigration;

(iii) In case of loss and/or destruction of the record of birth or non-

registration of birth

(iii.1) Certificate of non-availability of birth certificate on account of

loss and/or destruction of birth record from the local civil registrar
and/or appropriate government agency if birth was registered
(iii.2) Copy of birth certificate of mother or father certified by the
local civil registrar or the NSO; and

(iii.3) Affidavit of two (2) disinterested persons attesting to their

personal knowledge that at the time of the applicant’s birth, the
child was born of a Filipino mother or father.

Any document executed or issued abroad must be authenticated by the Philippine

Embassy or consulate having jurisdiction over the place of execution or issuance of the

c. Application Fee. A reasonable application fee to be determined by the SEC shall be

collected from each applicant.

d. SEC Action. Upon fulfillment of all SEC requirements and favorable evaluation by the
SEC, the Certificate of Registration under the Act for domestic corporations and
partnerships, or license to do business in the case of a foreign corporation, shall be
issued by the SEC. In case of disapproval, the SEC shall also inform the applicant in
writing of the reasons for the disapproval of the registration.

If the proposed project or activity qualifies for incentives, the foreign investor may file its
application with the appropriate government agency depending on the project’s location.

PEZA Registration vs. BOI Registration

Outsourcing companies in the Philippines can opt for either PEZA or BOI Registration to
obtain tax incentives in their respective fields of enterprise. Registering with either PEZA
or BOI offers numerous benefits for start-up companies in the country, including easier
visa processing for expat employees. However, only certain types of enterprises are
eligible for PEZA or BOI registration and registrants must comply with the conditions of
their respective registration agreements.

PEZA, short for Philippine Economic Zone Authority, is a government agency that
specializes in providing investment assistance and other incentives to foreign investors
inside the country. PEZA Registration supports business operations in the IT field,
including software development and application, IT-enabled services, content-
development for Internet and other media, Business Process Outsourcing (IT-BPO), as
well as IT research and development. Some PEZA benefits include income tax holidays
for up to four years, a special 5% tax on gross income (after the income tax holiday),
payment exemptions.. Foreign investors will also be granted a permanent residency
status upon initial investment of USD 150,000 to any sustainable, local enterprise.
However, enterprises located in PEZA zones are required to export at least 70% of their
total production.
The Philippine Board of Investments (BOI) is a government agency attached to the
Department of Trade and Industry that promotes solid business investments in the
Philippines. BOI Registration supports IT, IT-enabled and ICT support services,
including software and application development, Business Process Outsourcing (IT-
BPO), internet service provisions and other related fields of interest. Some benefits of
BOI Registration include income tax holidays, deduction of labor expenses, as well as
the unrestricted use of consigned equipment. However, BOI registered companies are
required to export 70% of their annual production, and foreign-owned firms must obtain
40% Filipino ownership after a given number of years.

(Board of Investments) (Board of Investments)
Physical Location Physical Location
Companies are required to relocate Companies are not required to relocate
operations inside a PEZA IT Zone or PEZA to a designated zone
Eligibility Any new or existing firm is eligible for
Any new or existing firm is eligible for PEZA BOI benefits
benefits, as long as it closes all operations
outside PEZA zones and relocates inside a
PEZA designated location

Documentation Documentation

 Project brief- entails the submission  3 copies of BOI application form

of additional documents to confirm 501
the statements made therein  3 copies of project report and
 Anti-graft certificate supporting documents
 Board Resolution Authorizing the
designation of a representative
 SEC Certificate of Registration
 Project feasibility study- includes
reference documents and other
information used for the study
Filing Fee
Filing Fee Application for registration
Application Fee
 Project costs not exceeding P4
 Non-Pioneer: P3,600.00 million: P1,000.00
 Pioneer: P6,000.00  Project costs exceeding P4
million (but not over P20 million):
Registration Fee P2,000.00
 Project costs exceeding P20
 Registration of New million (but not over P50 million):
Projects…..P6,000.00 P3,000.00
 Project costs exceeding P50
million: P4,000.00
Export Commitment Export Commitment

 There are no export commitments  For Filipino citizens, there is no

for registrable IT services export commitment
 For Filipino citizens, at least 50% of  For more than 40% foreign-
total services must be exported owned companies, at least 70%
 For foreigners, at least 70% of total of total services must be
services must be exported exported
 For firms that engage in pioneer
activities, 100% of activities may
be invested in domestic markets
provided that the firm complies
with requirements under the
Foreign Investments Act
(FIA). [paid-up capital of at
least USD 200,000 which may
be lowered to USD 100,000 for
projects that involve advanced
technology as determined by
the Department of Science
and Technology and hire at
least (50) direct employees]

 Three (3) to eight (8) year

income tax holidays;
 Four (4) to six (6) year
 Offshore profit remittances, not
exemption from local business
subject to remittance tax;
taxes for pioneer and non-
 Income Tax Holiday for four (4)
pioneer industries;
years for Non-pioneer IT
 Exemption from Taxes and
enterprises, or six (6) years for
Duties on Imported Spare Parts
Pioneer IT enterprises;
 Exemption from Wharf Dues and
 After the ITH period, the option to
Export Tax, Duty, and Impost
pay a special 5% tax on gross
income earned, in lieu of all
 Tax Exemption on Breeding
national and local taxes, except
Stocks and Genetic Materials
real property taxes on land owned  Tax Credits
by developers;  Additional Deductions from
 Exemption from payment of import Taxable Income
duties and taxes on imported
machinery and equipment and raw
 Additional deduction equivalent to
50% of training expenses,
chargeable against the 3% share of
the national government in the
special 5% tax on gross income;
 Permanent resident status for
foreign investors with initial
investments of US$ 150,000.00 or
 Exemption from Branch Profit
Remittance tax for PEZA-registered
branches of foreign corporations;
 Other incentives, as determined by
the PEZA Board.
 ICT Services: Software
 Software Development and
development, computer
Application:Programming and
graphics, animation
development of system software for
 ICT-enabled
business, media, e-commerce,
Services: Business that can be
education, entertainment, and
delivered through the use of ICT
many others
infrastructure [call centers,
 IT-enabled Services:Call centers,
contact centers, legal
Data Encoding, Transcribing and
transcription, medical
Processing, Directories, etc.
transcription, engineering,
 Content Development for the
design, back-office
Internet and other forms of
operations, business process
 Knowledge-based and
 ICT-support
Computer-enabled Support
Services: Business that
supports the development of ICT
Architectural design services, and
Services [R&D Centers,
Incubation Centers,
 Business Process Outsourcing
Institutions, Community
 IT research
Access Facilities, Internet
 Other IT-related services
Service Providers]
 PEZA application is submitted
 Submission of BoI application
 PEZA application is evaluated
 Project Outline
 Application is presented and
 Feasibility Report
reviewed before the PEZA board
 Five year Financial Plan
Turnaround Time: depends on the
Turnaround Time: 5-21 days
availability of the PEZA board

PEZA benefits are usually geared toward export manufacturing, IT and Tourism
enterprises, while BOI benefits are more focused on IT-BPO Research and


a. Existing Requirements.

As required by existing laws and regulations, BTRCP Form No. 17 and accompanying
documents shall be submitted to BTRCP.

All documents executed abroad should be authenticated by the Philippine Embassy or

Consular Office.

b. Additional Requirements. The additional requirements for corporations and

partnerships provided under Sec. 3 (b) hereof shall be complied with.

c. Application Fee. A reasonable application fee to be determined by BTRCP shall be

collected from each applicant.

d. BTRCP-DTI Action. Upon fulfillment of all BTRCP-DTI requirements and favorable

evaluation by DTI, the Certificate of Registration for Sole Proprietorship shall be issued
by DTI. In case of disapproval, DTI shall also inform the applicant in writing of the
reasons for the disapproval of the registration



a. During the transitory period, any applicant who has an investment in an existing joint
venture, in which he or his majority shareholder in the existing joint venture is a
substantial partner, shall be registered with the SEC or BTRCP in the same line of
business if the Filipino partners representing the majority of the Filipino equity in the
existing joint venture certify under oath that they are not capable and willing to make the
investment needed for the domestic market activities, which is being proposed to be
undertaken by the applicant.
b. If the Filipino partners are willing and able to make the needed investment, the SEC
shall not register the applicant, in which case, both joint venture partners may agree to
undertake the expansion. Both partners are then required to place the balance of their
agreed upon investment shares within six (6) months from the date of the agreement.
The Filipino partner(s) shall not be compelled to make additional investment for the
proposed expansion of domestic market activities if such will result in a higher Filipino
equity share. If the Filipino partner(s) fails(fail) to infuse said capital within said period,
per the report of the non-Philippine national applicant to the SEC, the SEC or BTRCP
shall then allow the registration of said non-Philippine national applicant as a separate
enterprise under the Act.