Step 1: Choose the right entity type
| Entity type | Can generate revenue | Foreign ownership | Minimum paid-in capital | Best for |
|---|---|---|---|---|
| Domestic Corporation | Yes | Up to 100% (subject to the negative list) | US$200,000 for domestic-market foreign-owned | Most Chinese firms wanting a separate legal entity and asset isolation |
| One Person Corporation (OPC) | Yes | Up to 100% | US$200,000 for domestic-market foreign-owned | One person acting as shareholder + director + president |
| Branch Office | Yes | 100% (parent company) | US$200,000 inward remittance | A parent company wanting to extend its operations directly |
| Representative Office | No (liaison / promotion only) | 100% | US$30,000 / year inward remittance | Scouting the market first, setting up a liaison point |
| Regional HQ · RHQ / ROHQ | RHQ no · ROHQ yes | 100% | RHQ US$50,000 · ROHQ US$200,000 | Multinational groups establishing an Asia-Pacific headquarters |
Under the Revised Corporation Code of 2019 (RA 11232), a single stockholder can form a corporation. It is called a One Person Corporation, or OPC, and the corporate name must end with "OPC" to distinguish it from an ordinary corporation. The key difference from a DTI sole proprietorship: an OPC is a separate legal entity, so the stockholder's exposure is limited to the investment, whereas a sole proprietor answers with all personal assets. Foreign nationals may be OPC stockholders provided the industry and equity share comply with the Foreign Investments Act and the negative list. An OPC and an ordinary stock corporation can also be converted into each other by filing amended articles with the SEC.
Who may form an OPC, and who may not
| Who you are | May form an OPC? | What to watch |
|---|---|---|
| A natural person (including foreigners) | Yes | Foreigners must satisfy the Foreign Investments Act; if the industry sits on the negative list, the equity share is capped |
| A trust or an estate | Yes | Proof of the trustee's or administrator's authority must be filed at incorporation |
| Banks, quasi-banks, trust companies | No | Expressly barred by law |
| Insurance and pre-need companies | No | Expressly barred by law |
| Licensed professionals practising their profession | No | Lawyers, accountants and the like cannot incorporate an OPC to practise |
| An existing ordinary stock corporation | Convertible | An OPC and an ordinary corporation convert both ways by filing amended articles and obtaining the SEC certificate of filing |
How an OPC is set up: from name reservation to opening day
- Name reservation: confirm the name is available; it must end with "OPC"
- Prepare the articles: primary purpose, principal office address, term of existence, stockholder details, subscribed and paid-up capital
- Designate a nominee and an alternate nominee (unique to the OPC): named in the articles, with the written consent of both. They take over if the stockholder dies or is incapacitated, so the company does not stop. This is mandatory, not optional
- File through the SEC's ESPARC portal: online filing has been the single route since 19 April 2021
- Within 15 days of incorporation, appoint a treasurer, corporate secretary and other officers, then notify the SEC within 5 days of doing so (OPC-specific deadlines)
- From here it matches an ordinary company: mayor's permit → BIR registration → SSS / PhilHealth / Pag-IBIG employer registration
After incorporation: officers, annual duties and three common misconceptions
- ✓The stockholder is automatically the sole director and president; no separate appointment is needed
- ✓The stockholder cannot serve as corporate secretary and must appoint someone else. The stockholder may serve as treasurer, but must post a surety bond scaled to the authorised capital stock
- ✓Audited financial statements are due within 120 days of the fiscal year end; below the statutory asset threshold, a treasurer's certification may stand in for an audit
- ✓Self-dealings and related-party transactions must be disclosed; the mayor's permit and BIR registration renew annually as usual
- ✓Misconception 1: that an OPC needs no capital. The minimum depends on the industry and on foreign ownership — a foreign-owned domestic-market OPC still faces the US$200,000 threshold unless an exemption such as export orientation applies (see "Can the capital threshold be lowered?" on this page)
- ✓Misconception 2: that a one-person corporation is a sole proprietorship. An OPC is a separate legal entity; a DTI sole proprietorship is not. The liability boundary is entirely different
- ✓Misconception 3: that limited liability is absolute. If the stockholder cannot show that personal property is separate from corporate assets, they may still be held personally liable (piercing the corporate veil)
Export-oriented enterprises (≥60% export) can be exempt from the US$200,000 threshold, dropping to as low as a few thousand pesos; employing ≥50 Filipino staff or using advanced technology can bring it down to US$100,000; entering an economic zone can, in some cases, reduce it to about US$50,000. It depends on what you do and who you sell to — let's talk it through and you'll know where you stand.
Documents required for registration
- ✓Name reservation application (company name approval)
- ✓Articles of Incorporation & By-Laws
- ✓IDs and proof of address for all directors / shareholders
- ✓Documents signed abroad must be notarized + consular authentication / Hague Apostille
- ✓Proof of registered office address (lease / address service)
- ✓Proof of paid-in capital / financial capacity (required for foreign-owned entities and branches)
- ✓For a branch, additionally: parent company board resolution, financial statements, articles, resident agent acceptance letter (SEC F-103 form)
- ✓For a rep office, additionally: board resolution, articles, proof of US$30,000 inward remittance, resident agent acceptance letter (SEC F-104 form)
Processing steps
- SEC name reservation and submission of registration documents for review
- Obtain the SEC Certificate of Registration / business license (License to Do Business for foreign entities)
- Open a corporate bank account, remit paid-in capital, and obtain the bank capital inward-remittance certificate
- BIR tax registration (Form 1903): obtain TIN, register books of accounts, apply for invoice / e-invoice authorization
- Barangay Clearance → Mayor's / Business Permit
- SSS / PhilHealth / Pag-IBIG employer registration (mandatory once you have employees)
A plain domestic-owned company takes about 2–4 weeks; foreign-owned / branch / regulated-industry setups take about 4–12 weeks (including SEC approval, capital inward-remittance certification, negative-list checks, and social security and municipal permits). Government fees typically start in the tens of thousands of pesos, plus a professional service fee — we give you a transparent breakdown itemizing government fees and service fees separately, with no hidden charges.
① Industries serving the local market are subject to the 60/40 foreign-ownership limit; going above 40% usually requires US$200,000 paid-in capital; ② Casually finding a Filipino to act as a nominee crosses the Anti-Dummy Law (反Dummy法) — both the funder and the nominee can face criminal liability, and company assets can be liquidated. What we do is build a lawful shareholding and capital structure, not find someone to act as a nominee.