PH DTI Issues Guidelines for Foreign Investment Application of Foreign Sole Proprietors
The Philippine Department of Trade and Industry released guidelines for foreign nationals who wish to engage in business as sole proprietorship within the Philippines.
The implementing rules and regulations of Republic Act No. 7042 or the “Foreign Investment Act of 1991,” as amended, provide that foreign sole proprietors who wish to do business as such in the Philippines must first obtain a Certificate of Registration for Sole Proprietorship. Pursuant thereto, the DTI released the requirements and procedure in securing such certificate, which the DTI guidelines refer to as the Certificate of Authority to Engage in Business in the Philippines or “CAEB.”
Prior to submitting an application for Business Name registration, foreign nationals must first apply for a CAEB with the DTI Regional Office/Provincial Office, by submitting the following documents:
- Duly Accomplished Application Form
- Proof of Identification (Passport for foreign national investor; or any government-issued ID for Filipino resident agent)
- Acceptable Visa
- Notarized Appointment of Filipino Resident Agent, if the foreign national appoints a Filipino resident as representative to process the application
- Proof of Inward Remittance of Foreign Currency with Peso Conversion, for non-resident aliens; or Bank Certificate of Deposit for resident aliens, issued by the bank.
- Authority to Verify Bank Accounts/Bank Certificate of Deposit
- Certification from Resident Alien not seeking Remittance of Profits and Dividends
- Valuation Report from accredited appraiser of BSP, if investment includes assets other than foreign currency
- Clearance/Certification from other involved agencies (clearance from PNP/DND if it involves defense-related activities; DOST if it involves advanced technology)
- Additional requirements as may be required.
The application for CAEB shall be completed within 7 days upon receipt of complete documents, in compliance with Republic Act No. 11032 or the “Ease of Doing Business and Efficient Government Service Delivery Act of 2018.” Furthermore, the regional and provincial offices of DTI may accept applications either offline or online through email.
After preliminary assessment, the DTI Regional Office/Provincial Office will conduct an interview (face-to-face or online) with the foreign applicant, together with his/her resident agent, if designated.
In case of inquiries or clarifications relative to the Foreign Investment Act or the Foreign Investment Negative List, the DTI may coordinate with the Board of Investments-Legal and Compliance Service (BOI-LCS) for its opinion, whenever necessary. The DTI may also require additional documentary requirements from the applicant.
For successful application, the foreign national applicant shall pay the application fee in the amount of Php 5,530.00 (inclusive of Php 5,000.00 registration fee, Php 30.00 documentary stamp, and Php 500.00 filing fee). Only upon proof of payment will the CAEB be released.
Once the foreign national obtains a CAEB, it may then apply for Business Name registration with any DTI Regional Office/Provincial Office, submitting thereto the CAEB reflecting the name of the owner and the name of the business.
The full guidelines may be accessed here and the necessary forms may be downloaded here.