How to Establish a Philippines Representative Office

Setting up a Philippines representative office is an ideal way for foreign corporations to build a footprint without commencing direct business. This setup acts mainly as a support hub, permitting a head office to handle promotional activities and quality control within the archipelago.

What is a Representative Office?
A representative office in the Philippines is viewed as an branch of a overseas entity. In contrast to a domestic subsidiary, it is not permitted to earn revenue locally. Instead, all costs must be fully subsidized by the head office. Since it does not function as a revenue-generating unit, it is typically exempt from corporate income tax, making it a strategic option for foreign firms.

Registration Requirements
To set up a Philippines representative office, the Securities and Exchange Commission requires a initial capital deposit of thirty thousand US dollars. This capital is intended to cover the entity's startup operating costs. In addition, the parent firm must select a local representative who lives in the Philippines to accept official notices on its behalf.

Scope of Operations
Although the scope of activities is philippines representative office restricted, it offers significant benefits:

Data Gathering: Performing feasibility studies to evaluate the Philippine market landscape.

Advertising: Providing information about the parent company's services.

Inspection: Ensuring that Philippine goods philippines representative office meet the global specifications.

Customer Liaison: Serving as a bridge between local clients and philippines representative office the main headquarters.

The Registration Process
The path philippines representative office to establishing your representative office includes several key steps:

Company Name: Securing the corporate name with the Securities and Exchange Commission.

Document Preparation: Preparing apostilled versions of the Articles of Incorporation and Board Resolutions from the head office.

Capital Remittance: Remitting the required USD 30,000 into a local corporate account.

SEC Submission: Presenting the application form and attachments for approval.

Licensing: Obtaining Mayor's permits and registering with the BIR.

Why Choose a Representative Office?
Selecting a Philippines representative office is a strategic move for businesses looking to explore the market without committing to heavy tax burdens. It permits efficient back-office support and establishes brand awareness in one of the region's fastest-growing markets. Once the market opportunity is proven, the entity can later transition into a philippines representative office branch for commercial activities.