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Philippines Company Formation

Philippines company formation is complicated by inconsistent incorporation regulations, lengthy administrative procedures and lack of transparency over government costs. In addition, the Philippines suffers from a poor reputation as a place to do business, with perceptions of corruption and political instability. However, the Philippines welcomes foreign investment and many international entrepreneurs build successful, profitable businesses in the country's expanding economy. The following information will help you determine whether Philippines company formation is the optimum solution for your business:
Advantages of Philippines Company Formation
1.
Foreign investors who choose Philippines company formation can take advantage of tax holidays of between three and eight years upon registration. Companies operating in special economic zones pay a corporate tax rate of just 5% on gross income.
2.
A business can be 100% foreign-owned if it is located in an Export Processing Zone or Special Economic Zone and up to 100% foreign ownership of domestic market enterprises is allowed except for specific areas listed under the Foreign Investments Negative List.
3.
A range of investment incentives are available to support Philippines company formation. For example, the Board of Investment (BOI) offers grants to foreign investors who invest in a 'pioneer' industry, as defined by the government. A full list of pioneer industries is identified in the Philippines Investment Priorities Plan (IPP).
4.
The Philippines is a member of the Association of Southeast Asian Nations (ASEAN). Entrepreneurs who choose Philippines company formation therefore gain access to key markets in ASEAN member states via preferential trade deals.
Disadvantages of Philippines Company Formation
1.
Philippines company formation and corporate bank account opening is complex and time consuming due to bureaucracy in the country. On average, client engagements last for eight weeks. The Philippines is negatively ranked as the 131st least corrupt country in the 2007 Corruption Perceptions Index by Transparency International, a global measure of corruption amongst public officials and politicians.
2.
The Philippines ranks as the 133rd easiest place in the world to do business, according to the 2008 Doing Business Survey by the World Bank. The survey measures factors including business start up procedures, time, cost and minimum capital required to start a business.
3.
Companies outside the special economic zones are subject to a corporate tax of 32%.
4.
Foreign investors choosing Philippines company formation should prepare for a minimum paid-up capital of US$200,000.
5.
Philippines company formation requires a minimum of five shareholders and five directors. The majority shareholding must be Filipino, unless 100% foreign ownership is granted.
6.
The Philippines is negatively ranked as the world's 92nd freest economy in the Heritage Foundation’s 2008 Index of Economic Freedom, a measure of freedom enjoyed in business, trade, monetary, financial, investment and labour markets.
7.
A statutory audit is required for all foreign corporations and branches. An annual return must also be submitted to the Bureau of Internal Revenue.
8.
The Philippines ranks a negative 90th on the United Nations Human Development Index, which rates a country on its overall life expectancy, literacy, education and living standards.
Other Information
Refer to the following links to read more information on Philippines company formation:
Contact Us
For more information on Philippines company formation, email email@healyconsultants.com or telephone us at (+65) 6735 0120.Back to Asia Pacific Company Incorporation page.


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Philippines Company Incorporation | Philippines Company Formation | Offshore Company in Philippines | Philippines Offshore Company




Philippines Company Incorporation | Philippines Company Formation | Offshore Company in Philippines | Philippines Offshore Company

ENGAGEMENT COSTS

Year 1 incorporation US$ * 12,750


Year 2 incorporation US$ *6,100


Nominee shareholder
US$**8,900


Company de-registration
US$1,450


* Depending on corporate structure and professional services required.

**Excludes US$3,450 refundable deposit.


 

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