In the Philippines, there are 3 options for business ownership: sole proprietorship, partnership, and a corporation. Which one is better for a foreigner will depend on the size of the business, the foreigner’s state of residence and whether he is married to a citizen of the Philippines.

1. Sole Proprietorship – This is the preferable business structure for a small business if you are married to a citizen of the Philippines. Provides full authority in the name of her spouse and he/she owns all assets. However, your spouse will also owe and be personally responsible for all liabilities or suffer all losses. It is easy to form and simple to register with the government.

2. Partnership – this is a business owned by two or more partners. One with more than 3,000 pesos of capital has to register with the Securities and Exchange Commission. All partners have personal responsibility for the affairs of the business. It’s like two sole proprietorships joined together. There are certain benefits for two Filipino citizen partners, but there are no benefits for you as a foreigner.

3. Corporation – This is my preferred form of ownership if the business is going to be something larger than a small hobby type business. For a small business, it is better to be in a sole proprietorship.

For a business of any size (such as a real estate ownership business, a franchise, a major manufacturing or export business), this is definitely the preferred form of ownership, and you, as a foreigner, can retain up to 40% of ownership, and by having yourself as the sole check signer on the bank account, you effectively control the corporation.

The minimum capital requirement is Pesos 5,000 and is regulated by the Securities and Exchange Commission. shareholders

liability is simply limited to your share capital amount. There must be at least five (5) incorporators, each of which must have at least one share. So what you do, for example, is you issue 56 shares to your spouse, 4 shares to your relatives, and 40 shares to yourself.

The minimum starting capital for a corporation is 25% of the subscribed shares, and a minimum of 25% of the authorized shares must be subscribed at the time the corporation is registered.