1. How to Register a Business in the Philippines
In the Philippines, before you can start any business, you have to first register your business with the Department of Trade and Industry (DTI) if it is a sole proprietorship or a partnership and from the Securities and Exchange Commission (SEC) if you are planning to operate a corporation or a partnership. Learn the steps on how to register a business in the Philippines to establish your venture legally.
Step one, register your company name. It will help to have three alternate names in case your top choice is already taken by another company. Fill out the required forms and an application form to register a corporation. Submit the forms to the SEC and wait for approval.
Step two, obtain a barangay clearance. The barangay is the smallest local government unit in the Philippines. Any business is required to obtain a barangay clearance before they are issued a Mayor’s permit.
Step five, you will have to register with the Social Security System and the Department of Labor and Employment. For the SSS, use an R1 form and check the nearest branch for payment details. The DOLE will require a report on your workforce and a self-assessment form.
Step four, register with the Bureau of Internal Revenue (BIR). This entails getting a BIR form 1901 for a sole proprietorship or a BIR form 0906 for a corporation. You will also need to obtain a BIR printed receipt and register your books of accounts.
Step three, get a mayor’s permit by applying at the office of the mayor in the city/municipality where you plan to conduct business. Requirements include the DTI or SEC registration, a sanitary permit and sometimes a zoning permit. Cost of the mayor’s permit varies on the registered capital and the location of the business.
2. Setting Up a Business in the Philippines
Setting up a business Philippines may seem daunting at first, but with proper guidance, it can be a rewarding endeavor.Top of Form
A business can be easily incorporated in the Philippines. As a rule of law, Filipinos with foreign ancestry and outside investors can own one hundred percent capital in a business. However, you have to maintain a minimum of US$200,000 capital if a foreigner is to engage in retail trade. This large sum of capital is more feasible with a business with more than 40 employees. The minimum requirement to maintain a large business is easier to maintain if you have a spouse (male/female) with Filipino blood. With the right visa, the foreigner can own a medium to small-scale business stated in the aforementioned right to own a business. A minimum capital of US$40,000 is needed for a technology transfer to manufacturing and a fixed US$50,000 for a small business. A small business is categorized by a business stipulated in Republic Act No. 6977, s4. “x x x an enterprise with at least sixty per centum (60%) Filipino ownership, or a foreign-owned enterprise which exports at least sixty percent of its products or services and generates employment.” (defunct). High-paid professionals such as medical or legal practitioners and artists may engage in sole proprietorship businesses (preferred for no joint partnership required for sole decision making for the business). Anything else will be a corporation. Co-partnership businesses must employ the right visas to own the business stated before proceeding into the formation process.
3. Starting a Business in the Philippines
Explore the essentials for starting a business in the Philippines to kickstart your entrepreneurial journey with confidence. It is generally easier to be successful by meeting the demand of a product or service, rather than creating demand where there is none. An industry with very few competitors could be very attractive; however, there may be a reason for this. On the other hand, an industry dominated by only a few key players might be hard to break into. This information should also help in making a decision on what type of corporation to register. A small family business may be sufficient in an industry with low competition and minimal growth, whereas a large-scale business should be considered for an industry with high demand and growth. Be sure to do research on the internal and external forces affecting the market.
