Where to Set Up in Southeast Asia (2026): Singapore, Malaysia, Thailand, Vietnam and the Philippines Compared

The four dimensions that decide whether you regret it

Decide what you are comparing before you compare, or a single headline metric — usually the corporate tax rate — will do the deciding for you.

1. Market access: how much of your business can you own, and does your sector need a local partner, a special licence or an investment-promotion route? This determines whether you can operate at all
2. Setup cost and timeline: not just registration fees but minimum paid-in capital, mandatory resident directors, premises, sector licence prerequisites, and the real gap between filing and lawfully opening the doors
3. People: talent supply and language, labour-law rigidity — especially on termination — statutory contributions, and the thresholds for your own and your staff's work authorisation
4. Exit: how hard it is to deregister, liquidate or sell. The spread between these countries on exit is far wider than the spread on incorporation

One live variable: global minimum tax rules are being implemented across several countries in the region, which erodes the practical value of low headline rates and long tax holidays for groups above the applicable threshold. Whether and how they apply depends on your group and each country's current legislation — take advice rather than assuming.

Ownership access: where each country blocks you

• Singapore — fewest restrictions. Most sectors allow full foreign ownership with no general equity cap; regulated activities need licences. The practical requirement is at least one director ordinarily resident in Singapore
• Malaysia — mostly open, with conditions in specific areas. Full foreign ownership is available in most sectors and at least one director must have a principal place of residence in Malaysia; some activities carry local equity conditions or additional licensing, with wholesale and retail trade being the classic case where foreign-owned entities face capital and licence requirements
• Thailand — the tightest on local services. The Foreign Business Act places much of the service sector in the category requiring a Foreign Business Licence, so foreign holdings are commonly kept below a majority. The real solution is BOI promotion, which can allow full foreign ownership plus land, visa and work permit facilitation, and is easier to obtain for manufacturing and targeted industries
• Vietnam — assessed sector by sector. Foreign projects usually need an Investment Registration Certificate followed by an Enterprise Registration Certificate, with services measured against WTO commitments. Manufacturing and export projects are well served. Note that land is state-owned — companies obtain land use rights, and industrial park leases are the standard route
• Philippines — opening up, but with a criminal red line others do not have. Restricted sectors and equity caps appear in the current Foreign Investment Negative List; reforms to retail trade, public services and the foreign investments law have widened access, with paid-in capital thresholds for domestic-market enterprises and mechanisms to reduce them. Critically, the Anti-Dummy Law makes nominee arrangements used to evade equity limits a criminal matter for both the Filipino lending their name and the foreigner relying on it. This is the point in all five countries that deserves the most care — for exactly how the management restriction works and the practical risk of nominee arrangements, see the dedicated breakdown in our Southeast Asia company setup guide

If your sector is restricted, the answer is redesigning the model, using an investment-promotion route, or choosing a different jurisdiction — not a nominee. Consult local counsel; this article is not legal advice.

Setup and startup cost: the speed gap is wider than you think, and so is what makes it expensive

Separate "registered" from "able to trade" and the ranking changes. Incorporation speed and time-to-first-invoice are not the same number in any of these five countries, and budgeting for the first without the second is how projects run out of runway.

• Singapore: fastest and most digital to incorporate, essentially an online filing. The cost lands afterwards — office rent, local salary levels and the salary thresholds on foreign employment passes are the region's highest. Suited to high-margin businesses whose core asset is people; poorly suited to scaling on low cost.
• Malaysia: middle of the pack and comparatively smooth. Clear procedures, English throughout, and a mature company secretary regime; office and staffing costs are visibly below Singapore's. Paid-up capital and licensing conditions on certain foreign-owned activities raise the entry bar, so check them sector by sector.
• Thailand: the filing is not the hard part — choosing the route is. Going through BOI promotion means preparing a full investment plan for review, which takes longer but buys ownership latitude and related facilitation. Skipping BOI means living with foreign equity limits or applying for a business operation licence. Decide the route first, then talk about incorporation.
• Vietnam: the most procedural steps of the five. The two-stage IRC and ERC process, plus land lease, fire safety, environmental and sector approvals, means the path from decision to production needs a real plan. The payoff is that once you are operating, the manufacturing ecosystem and free trade agreement network are the strongest of the five.
• Philippines: incorporation is manageable; the permits are what consume the calendar. After SEC registration come BIR registration, books and invoices, the local government business permit, fire and sanitary clearances, and the sector regulator's licence. In practice the delay is rarely the company registration itself — it is sector licensing and the queue at city hall.

Three habits that remove most of the wasted money, whichever country you pick:

1. Make the permit list your project's first document. Write out every licence required, the dependencies between them (which certificate must exist before another can be filed), and the official processing times — then budget on one to two times those figures.
2. Put a permit-failure exit or suspension clause in the lease, so rent does not start running months before revenue does. Confirm the zoning allows your activity before you commit to a site.
3. When comparing quotes, insist on government fees and service fees as separate lines. Unusually cheap proposals typically move notarisation, authentication, translation, registered address, books of account and bank-opening assistance into later add-ons. Ask what the total is from name reservation to legally issuing your first invoice, and what is in and out of that number.

One more factor that gets left out of this budget: your foreign ownership percentage feeds back into whether you can obtain a work permit and how much paid-up capital you need. That mechanism is broken down in our Southeast Asia company setup guide.

People, hiring and firing: where hiring is easy, and where letting go is hard

This dimension decides long-run cost more often than the tax rate does — and the countries that are easiest to hire in are frequently the hardest to exit an employment relationship in.

• Philippines: the deepest English-speaking services talent pool in the region, and a young workforce — the reason its BPO industry leads globally, with large numbers of people trained in customer service, finance shared services and content moderation. The constraint is at the termination end: probation is capped, employees then become regular, dismissal requires a statutory ground and strict procedure, the burden of proof sits with the employer, and disputes that reach the NLRC can run long. Foreign hires need an employer-obtained AEP from DOLE — published for objection, with a local-unavailability justification — before the 9G visa.
• Singapore: the strongest and most international talent market, the most flexible regime, and the highest total cost. Foreign professionals need an Employment Pass subject to salary thresholds and a points-based assessment; lower-skilled passes face quotas and levies. Employer CPF contributions apply for local staff. Termination is comparatively flexible, but total cost of employment is the highest of the five.
• Malaysia: a good English environment and genuinely multilingual talent (Malay, English, Chinese), which makes it a natural regional shared-services base. Employment passes are tiered by salary and contract length, and the employing company must meet paid-up capital conditions — higher for wholly foreign-owned entities. Statutory provident fund and social insurance are fixed employer costs.
• Vietnam: the best industrial labour supply and the strongest cost competitiveness. The labour code is prescriptive on working hours, overtime ceilings, contract types and termination procedure, and the union structure has a real presence at enterprise level. Foreign work permits are generally limited to managers, experts and technical workers, with documentation and legalisation requirements that are detailed in practice.
• Thailand: mature manufacturing and service talent, with high day-to-day liveability. Some occupations are reserved for Thai nationals; work permits are typically tied to registered capital and Thai employee ratios, and BOI-promoted companies have a smoother path here. Exact ratios and thresholds follow current official rules.

The one-line version: for ease of hiring look at the Philippines and Vietnam, for seniority of talent look at Singapore, for value and language look at Malaysia — and on the cost of letting someone go, the Philippines, Vietnam and Thailand are all far more rigid than Singapore, so raise your hiring bar accordingly.

That is about the local and foreign staff you hire. If the question is instead "do I, the owner, need a work permit", that is a separate and frequently missed point — covered in its own section of our Southeast Asia company setup guide.

Exit and deregistration: closing a company in Southeast Asia is the column nobody budgets

This is the section worth remembering. Incorporation difficulty varies by a factor of a few across these countries; deregistration difficulty varies by far more — and exit cost is what determines the price of being wrong.

• Singapore: the cleanest. A solvent company with no outstanding matters can apply to be struck off, or go through members' voluntary liquidation. The corollary of an efficient system is that it assumes you were compliant all along
• Malaysia: moderate. Strike-off or liquidation, after tax and statutory filings are settled
• Thailand: slow. Dissolution requires liquidation and normally a tax review; months is typical and beyond a year is not unusual
• Vietnam: known for being slow. Closing a foreign-invested enterprise requires tax finalisation and sign-off across several agencies, and irregular historical records extend it considerably
• Philippines: slow, and unforgiving of a messy history. Four workstreams must close: dissolution at the SEC; deregistration at the BIR, which reviews every historical open case and requires amended filings, taxes and penalties before a tax clearance issues; retirement of the local business permit; and the rest — employer deregistration for social contributions, final pay, downgrading or cancelling foreign staff visas, and closing accounts. The company must keep filing throughout, so neglect compounds

Two rules follow for every country here. First, "register something and see how it goes" is the most expensive strategy in high-exit-cost jurisdictions — a dormant but un-deregistered company is a machine that manufactures penalties. Second, if you are only testing a market, test without a permanent establishment: cross-border delivery, local distributors or agents, trade fairs, or an entity in a jurisdiction that is easy to unwind. Commit to a local entity once the model is proven.

Deregistration dragging into a second year with tax clearance still stuck? → company setup and dissolution services

The best country to start a business in Southeast Asia depends on the business: recommendations by type

• Export manufacturing and supply chain → Vietnam first, Thailand second. Vietnam's industrial ecosystem, labour supply and trade agreement network are built for making things and selling them worldwide; Thailand has deep automotive, electronics and food processing bases with BOI solving the ownership question. Both are slow to exit, so plan land and environmental approvals early
• Regional headquarters, finance, IP and cross-border structuring → Singapore. The strongest institutions and dispute resolution in the region, at the highest all-in cost. If your margins are thin or your business is not talent-led, that cost structure will show quickly
• Shared services and back office → Malaysia and the Philippines. Malaysia wins on overall balance; the Philippines wins on the sheer scale of its English-speaking services workforce, with power reliability, logistics and administrative efficiency as the trade-offs to budget and design around
• Consumer retail, food and beverage, local services → check access before you check the market. Thailand has strong domestic demand but the tightest service-sector restrictions; the Philippines has a large young consumer base with liberalised but conditional retail rules; Vietnam is growing fast with more approvals; Malaysia is balanced; Singapore is small and expensive, suited to high-ticket brands
• Software, digital services and cross-border e-commerce → decide where customers, tax and people sit. Singapore as the contracting and IP entity, Malaysia or the Philippines for delivery and operations, Vietnam for engineering. This is the group most exposed to global minimum tax questions, so model them before choosing

One closing caution: do not reverse-engineer a country choice from someone else's success story. An exporter and a restaurant chain in the same country face entirely different rules, approvals and risks. Map your own sector's access position, permit list, labour regime and exit path first.

If you have narrowed the choice to the Philippines — or are deciding between the Philippines and one other market — the next questions are entity type, how to structure ownership, how to size paid-up capital, and how you personally get authorised to work in the company: the execution-level detail is in our Southeast Asia company setup guide, or have Yixing map your entry structure and compliance path directly.