Here’s a practical, everything-you-need-to-know legal guide to launching a foreign brand in the Philippines—your options, the rules that matter most, typical requirements, taxes, and realistic timelines. It’s written for counsel and business leads who need to plan and execute quickly. (General information only—specifics can vary by sector and municipality.)

Company Incorporation in the Philippines for Foreign Brands: Requirements, Options, and Timelines

1) First questions to decide your path (quick decision tree)

What will you do in PH?

Sell to the Philippine market → Subsidiary (domestic corporation or one person corp) or Branch.
Back-office/Support only (no local sales) → Representative Office or RHQ (liaison).
Regional service center earning from affiliates → Branch or ROHQ (less common now).
Pilot/testing, no revenue yet → Representative Office (short-term) or Subsidiary with minimal ops.

How much foreign ownership is allowed?

Many activities allow 100% foreign ownership.
Some are partially nationalized (e.g., certain “public utilities,” mass media, small-scale natural resources, and other items listed in the Foreign Investment Negative List and sectoral laws).
If your activity is restricted, you’ll need a Filipino partner to meet statutory percentages and board composition rules.

Will you license your foreign brand and collect royalties?

That’s common. Plan for withholding tax on royalties, VAT on imported services, and (often advisable) technology-transfer registration for tax and enforceability considerations.

2) Your main legal vehicles (what they are, when to use them)

A. Domestic Corporation (Subsidiary)

Separate legal entity owned by the foreign parent.
Ownership: Up to 100% foreign if your activity isn’t restricted.
Capital rules (high level):
- If domestic-market oriented and ≥40% foreign-owned, the Foreign Investments Act generally requires at least USD 200,000 paid-in capital (lower possible to USD 100,000 for “advanced technology” or ≥50 Filipino employees, and special carve-outs for qualified startups/startup enablers). Export enterprises (≥60% exports) are generally not subject to that floor.
- Sector-specific laws can impose higher thresholds (e.g., retail, financing, insurance, banks).
Governance (Revised Corporation Code):
- 2–15 directors (natural persons); President must be a director.
- Corporate Secretary: must be a Filipino citizen and resident.
- Treasurer: must be resident (citizenship not required).
- For activities with foreign ownership caps, board composition must reflect nationality rules.
Pros: Strong local identity, limited liability, easiest for B2C retail and hiring.
Cons: Dividend withholding when remitting profits; more post-incorporation filings.

B. One Person Corporation (OPC)

Single shareholder corporation (can be foreign if the activity allows it).
Not allowed for certain regulated sectors (e.g., banks, insurance, publicly listed companies, etc.).
Pros: Ultra-simple ownership; fast decisions.
Cons: Same foreign ownership and sectoral limits apply; officer residency rules still apply (Secretary must be Filipino).

C. Branch Office of a Foreign Corporation

Same legal personality as the foreign parent; needs an SEC License to Do Business.
Capital: The SEC will look for inward remittance/assigned capital (practical floor often akin to the USD 200,000 Foreign Investments Act standard for domestic-market activities unless an export/technology carveout applies).
Taxes: Regular corporate income tax on Philippine-source income, Branch Profits Remittance Tax (BPRT) (generally 15%) when profits are remitted to the head office, plus VAT if applicable.
Pros: Simpler profit repatriation (no dividends); good for B2B/project work.
Cons: Parent is directly on the hook for liabilities; local customers sometimes prefer contracting with a domestic entity.

D. Representative Office (Rep Office)

Not allowed to earn income in the Philippines. For liaison, marketing support, quality control, or sourcing on behalf of the parent.
Capital: Must show sufficient inward remittance to fund operations (commonly a minimum initial amount is expected by the SEC).
Taxes: No income tax on operations (no revenue), but you have payroll taxes for employees, and you may have VAT registrations depending on activities (consult your tax advisor).
Pros: Low-risk, fast to set up, ideal for early market development.
Cons: Cannot sell or book revenue locally; often a short-term bridge.

E. RHQ/ROHQ (Regional Headquarters / Regional Operating Headquarters)

Historically used for regional hubs; incentive regimes and employee tax perks changed in recent years, so uptake is rarer.
Today, many multinationals instead use a subsidiary (domestic corp) or branch and (optionally) register for incentives with PEZA/BOI.

3) Foreign ownership & sectoral overlays (what can be 100% foreign-owned?)

Generally open: Export manufacturing, IT-BPM/Shared Services, most wholesale/distribution, many services.
Partially or fully restricted: Mass media (generally no foreign ownership), certain “public utilities,” small-scale mining, private security, and other items under the Foreign Investment Negative List (FINL) and sectoral laws (e.g., banking, insurance, professional practice).
Public Service Act (as amended) narrowed the scope of “public utilities,” opening many infrastructure-like sectors to higher foreign equity, but some core utilities remain restricted.
Retail trade has its own statute: the Retail Trade Liberalization Act (RTLA) as amended lowered the capital bar for foreign retailers (still significant). If you’re opening consumer stores under a foreign brand, analyze RTLA vs. distributor/franchise paths carefully.

Anti-Dummy Law warning: Avoid sham structures that delegate management/control to foreigners in partially nationalized activities beyond what the equity cap permits. Violations have criminal and administrative consequences.

4) Capitalization & banking (what money must you bring in, and how?)

Subsidiary: Follow the Foreign Investments Act floors (if domestic-market and ≥40% foreign) or sectoral capital rules. You’ll open a corporate bank account and deposit paid-in capital (a Treasurer-in-Trust may hold funds pre-incorporation).
Branch: Bring in assigned capital by inward remittance; your bank issues Bangko Sentral-compliant documentation (keep these for future repatriation).
Rep Office: Fund operations via head office remittances only (no local revenue).
FX & repatriation: Registration of foreign investment with a bank/central bank channel has become more documentary/records-based over time; keep bank certificates, remittance advices, and SEC/BIR filings to ease dividend/branch profit remittances later.

5) Taxes (snapshot—confirm current rates before you launch)

Corporate Income Tax (CIT): Domestic corporations and branches pay regular CIT on net taxable income (rate bands changed under tax reforms; check your current band—many pay 25%, with a 20% tier for qualifying small domestic corporations).
BPRT (Branch profits remittance): Generally 15% on profits remitted by branches to head office (treaty relief may apply).
Dividends: Dividends from domestic corp to non-resident shareholders are subject to final withholding tax (rate depends on treaty and domestic law).
Royalties/Brand license fees: Typically final withholding tax to non-residents (often 25% absent a treaty reduction), plus 12% VAT on imported services under reverse charge if the Philippine entity is VAT-registered.
VAT: Standard rate 12% on sale of goods/services in PH (exports may be zero-rated). Some activities are VAT-exempt or subject to percentage tax.
Local business taxes: Cities/municipalities levy annual Mayor’s Permit fees and local business tax (often a fraction of gross receipts).
Incentives (CREATE): Projects registered with PEZA/BOI/other IPAs may receive Income Tax Holiday (ITH) and either Special Corporate Income Tax or enhanced deductions—availability depends on your location, activity, and supply-chain footprint.

Transfer pricing: If you have related-party dealings (services, royalties, intercompany loans), you must maintain TP documentation and file related-party forms. Start this on day one to avoid disallowances.

6) Brand licensing, franchising, and retail

Licensing your brand to a PH entity is common. Ensure the agreement covers territory, quality control, marketing, royalties, audit rights, termination, and IP enforcement.
Technology Transfer Arrangements (TTA): Registration with the IP Office’s TTA unit is often advisable for tax deductibility and to validate certain clauses (some stipulations are void by law if they unduly restrain competition or technology diffusion).
Franchising: No single “franchise law,” but you must comply with IP, consumer protection, advertising, product standards (DTI/BPS), and sector-specific permits (e.g., FDA for food, cosmetics).
Retail: Foreign-owned retail stores are governed by RTLA (as amended). This sets minimum paid-up capital and other conditions; many foreign brands instead use master franchise/distributor models where the local company operates stores in its own name.

7) Immigration & employing foreigners

9(g) Pre-arranged employment visa + DOLE Alien Employment Permit (AEP) for foreign hires.
Short-term work may require Special Work Permit (SWP).
Investor/Entrepreneur visas (e.g., SIRV, SVEG) exist for specific cases.
Treaty visas also exist for certain nationalities (check current treaty coverage).
Filipino employees are enrolled in SSS, PhilHealth, and Pag-IBIG; comply with wage orders, holiday pay, and OSHS rules.

8) The incorporation / registration process (step-by-step)

Processes are now largely online through the SEC company registration system and e-filing for reports. Time frames below are typical, not promises.

A. Subsidiary / OPC

Name check & reservation (SEC).
Prepare constitutional docs:
- Articles of Incorporation (state primary/secondary purposes carefully).
- By-laws (not needed at filing for OPC).
- Foreign shareholders’ proofs (authenticated/apostilled certificates of existence/good standing; board/consent resolutions authorizing investment; IDs).
- Officer appointments (President, Treasurer, Corporate Secretary).
Banking: Open account and deposit paid-in capital (or appoint Treasurer-in-Trust to certify funds).
SEC approval: Receive Certificate of Incorporation (or OPC Certificate).
BIR registration:
- Get TIN, register books of accounts and invoicing system (ATP or CAS), and enroll in eFPS/eBIR as applicable.
Local government: Barangay Clearance → Mayor’s/Business Permit (often requires lease/office address, occupancy/fire safety).
Statutory enrollments: SSS, PhilHealth, Pag-IBIG (as employer).
Special permits: If your sector is regulated (e.g., FDA, DICT, BSP for financing, Insurance Commission, etc.), obtain those licenses.
Optional incentives: Apply with PEZA/BOI (often done in parallel).

Typical calendar time: 3–8 weeks end-to-end in metro areas, assuming documents are complete and banking KYC is smooth.

B. Branch Office

Parent Board Resolution: Establishing PH branch, appointing a Resident Agent (individual or domestic corp).
Authenticated parent documents: Articles/Constitution, By-laws, Certificate of Good Standing, and audited financial statements of the parent (recent year), all apostilled/legalized.
SEC License to Do Business application + inward remittance for assigned capital.
BIR, LGU, and statutory enrollments (same as subsidiary).
Sectoral licenses if needed.

Typical calendar time: 4–8 weeks (document legalization frequently drives the timeline).

C. Representative Office

Parent Board Resolution authorizing a liaison office, appointing Resident Agent, and guaranteeing all expenses.
Authenticated parent documents (as above) and evidence of inward remittance to fund operations.
SEC Rep Office License, then BIR/LGU/statutory registrations.

Typical calendar time: 3–6 weeks.

9) Post-incorporation compliance (don’t skip these)

SEC filings:
- General Information Sheet (GIS) annually (within 30 days from annual meeting/anniversary for OPC).
- Audited Financial Statements (AFS) annually (filed via SEC e-filing system; deadlines vary by FY end and SEC circulars).
- Beneficial Ownership disclosures per AMLA/SEC rules; keep up to date.
BIR:
- VAT/Percentage tax, withholding (compensation/expanded/final), quarterly and annual income tax returns; enroll in the correct e-systems.
- Transfer Pricing compliance and Related Party Transactions forms where applicable.
LGU: Mayor’s Permit renewal every January; Fire Safety inspection.
Labor: DOLE Rule 1020 (establishment report), workplace safety compliance; keep employment contracts, handbook, and data privacy notices current.
Data Privacy: Appoint a Data Protection Officer (DPO); register with the National Privacy Commission if you meet thresholds or process sensitive personal data at scale; implement privacy management and breach protocols.
Licenses: FDA, telco, finance, or other sectoral licenses often require periodic renewals or reports.

10) Comparing the vehicles (at a glance)

Feature	Subsidiary (Corp/OPC)	Branch	Rep Office
Legal personality	Separate	Same as parent	Same as parent
Can earn PH revenue?	Yes	Yes	No
Capitalization baseline	FIA/sectoral rules	Assigned capital (FIA logic often used)	Funded by HO remittance
Profit repatriation	Dividends (WHT)	BPRT on remittance	N/A
Liability ring-fence	Yes	No (parent exposed)	N/A (no revenue)
Governance	Full board/officers	Resident Agent	Resident Agent
Best for	Retail/B2C, hiring, brand building	B2B/project rollout	Early market dev, liaison

11) Special notes for foreign brands

Trademark first: File your IPOPHL trademark early (word + device). Corporate name approval does not protect your brand.
Trade dress & advertising: Food, cosmetics, medical devices, and supplements trigger FDA approvals and advertising restrictions; substantiation rules apply.
Distribution vs. retail: You can often avoid retail constraints by using independent distributors selling in their own name and on their own account (but design the contract so you are not “doing business” without an SEC license).
Royalties and marketing contributions: Expect withholding tax and reverse-charged VAT. Set arm’s-length royalty rates and keep TP files.
Franchise compliance: Quality control clauses are vital (they also help defend your mark). Align with Consumer Act, product standards (DTI/BPS), and labor obligations.

12) Common pitfalls (and how to avoid them)

Anti-Dummy risks: Don’t use nominees to skirt equity caps; ensure real Filipino control where required (board, veto rights, management).
Purpose clause mismatch: Your primary purpose must cover your actual activities (retail vs. wholesale vs. services). Misalignment can block permits or insurance claims.
Bank/KYC surprises: Local banks often want signatories to appear in person and ask for apostilled board resolutions; schedule these early.
“Doing business” inadvertently: Appointing a dependent agent concluding contracts on your behalf can be “doing business” without a license; structure distributor relationships carefully.
Ignoring local taxes: LGU assessments can be material; model them by city.
Late TP/related-party filings: Penalties are steep; calendar these with finance.
Data privacy & employee records: Appoint a DPO and document compliance; the NPC audits.

13) Realistic timelines (playbook view)

Document legalization/apostille abroad: 1–3 weeks (varies by country).
SEC registration:
- Subsidiary/OPC: 5–10 business days once complete (complex structures take longer).
- Branch/Rep: 5–15 business days (parent AFS/legalization often drives timing).
BIR registration: ~3–7 business days for TIN, books, and invoicing.
Mayor’s Permit (LGU): 1–2 weeks (varies; renewals every January).
Bank account fully operational: 1–2 weeks after KYC/signatories completed.
Hiring foreigners (AEP + 9(g)): start early; lead times can be several weeks.

14) Practical checklists

Incorporation dossier (Subsidiary/OPC)

Proposed name and primary purpose.
Articles of Incorporation (and By-laws for corps).
IDs and TIN/foreign TIN of incorporators/directors/officers.
Corporate Secretary (Filipino citizen/resident) consent.
Treasurer (resident) consent; Treasurer-in-Trust certification.
Proof of paid-in capital (bank certificate) or placement agreement.
Lease or proof of address (zoning/occupancy compliance).
Apostilled foreign shareholder documents (good standing, board approvals).

Branch/Rep Office pack

Apostilled Board Resolution authorizing the Philippine office and Resident Agent.
Apostilled Articles/Constitution, By-laws, Certificate of Good Standing.
Parent’s audited financial statements (latest year).
Inward remittance proof (assigned capital / operating funds).
Resident Agent acceptance and ID; local office address/lease.

Go-live

SEC Certificate or License to Do Business.
BIR TIN + books/invoices registration; e-filing enrollment.
Mayor’s Permit + Fire Safety inspection.
SSS/PhilHealth/Pag-IBIG employer numbers.
Data privacy: DPO appointment; system registration if required.
Sectoral licenses (FDA, finance, etc.).
IP filings at IPOPHL.

15) Subsidiary vs. Branch vs. Rep—tax and cash summary (high level)

Subsidiary: Pays CIT on income. Dividends to foreign parent—final WHT (rate depends on treaty). No BPRT. VAT applies as usual.
Branch: Pays CIT on income. BPRT (≈15%) when profits are remitted to head office. VAT applies as usual.
Rep: No revenue; generally no income tax (but payroll taxes and other compliance still apply).

Treaty relief must be applied for and documented to enjoy reduced rates (dividends/interest/royalties); plan applications before payment dates.

16) Frequently asked

Q: Can a foreigner be the sole shareholder and director? A: Yes via OPC if the activity is open to full foreign ownership; otherwise, equity caps and board nationality rules apply.

Q: Do directors need to be Philippine residents? A: The law no longer imposes a blanket residency requirement for directors, but the Corporate Secretary must be a Filipino citizen/resident and the Treasurer must be resident. Sectoral rules may impose additional director/manager fit-and-proper or residency requirements.

Q: Can we sell online only (no stores) and avoid retail rules? A: E-commerce is still retail if you sell directly to consumers; analyze RTLA vs. distributor/marketplace structures.

Q: We just want a test team for 12 months—what’s the lightest path? A: Rep Office (no sales) or a small subsidiary doing export-only services (to avoid FIA domestic-market capital floors). If you’ll sell locally, you’ll need a subsidiary or branch.

17) Final takeaways

Pick the vehicle based on revenue in PH vs. liaison, liability ring-fence, and capital/tax outcomes.
Map your sector against foreign ownership caps and the latest Negative List/Public Service Act rules.
For foreign brands, get IPOPHL filings in early, and structure royalties with withholding/VAT and transfer pricing in mind.
Build a compliance calendar (SEC GIS/AFS, BIR returns, LGU renewals, data privacy, labor).
Time your apostilles/legalizations and bank KYC—they drive your critical path.

If you’d like, tell me your planned business model (what you’ll sell, where revenue is booked, expected headcount, and whether you’ll open stores). I’ll map it to the best vehicle, a capital plan, and a step-by-step launch checklist you can hand straight to counsel and operations.