Doing Business in the Philippines: A 2026 Compliance Checklist for Foreign Companies

This checklist is designed as a working reference for compliance officers, legal counsel, and senior management of foreign-owned enterprises entering or operating in the Philippines. Every item is grounded in current Philippine statute, regulatory issuance, or agency guidance effective as of 2026.

The Philippine compliance landscape has undergone significant legislative evolution since 2019 — from the Revised Corporation Code[1] and the CREATE Act[2] to reforms under the Retail Trade Liberalization Act[3] and the amended Foreign Investments Act.[4] For foreign companies, the 2026 operating environment is both more open and more scrutinized than at any point in the country's recent regulatory history.

Use this checklist as a structured audit framework — not a substitute for qualified Philippine legal and tax counsel. Items marked as critical represent areas where non-compliance has been most frequently cited in SEC, BIR, and DOLE enforcement actions against foreign-affiliated entities in 2023–2025.

Jan 30 BIR deadline: expanded withholding tax returns (monthly)

Apr 15 Annual income tax return filing (corporate fiscal year = calendar year)

120 days After FY close: SEC audited financial statements submission deadline

30 days After any officer/director change: SEC General Information Sheet update

Module A. Corporate registration and SEC compliance

All foreign corporations doing business in the Philippines must hold a valid License to Do Business issued by the Securities and Exchange Commission (SEC) under the Revised Corporation Code (RA 11232). [1] The entity structure — Branch Office, Representative Office, Regional Headquarters (RHQ), or Regional Operating Headquarters (ROHQ) — determines capital requirements, permissible activities, and tax treatment.

Secured SEC License to Do Business before commencing any revenue-generating activity in the Philippines.[1] · SEC

Assigned capital requirements met: Branch Office — minimum $200,000 inward remittance; RHQ — minimum $50,000 annual operating budget; ROHQ — minimum $200,000 annual operating budget.[5] · SEC / BSP

Annual General Information Sheet (GIS) filed within 30 days of the annual stockholders' meeting and updated within 30 days of any change in directors, officers, or stockholders. · SEC

Audited Financial Statements (AFS) prepared under Philippine Financial Reporting Standards (PFRS) and filed with the SEC within 120 days after fiscal year-end. [7] · SEC / FRSC

Beneficial ownership register maintained and disclosed under SEC Memorandum Circular No. 6, Series of 2022, identifying all natural persons with ultimate ownership above 10% threshold.[8] · SEC

Compliance with equity restrictions under the current Foreign Investment Negative List (FINL) verified for all business activities — including secondary activities and revenue streams.[4] · SEC / DTI

Anti-Dummy Law compliance confirmed: no Filipino nominee or trustee arrangement used to circumvent FINL equity restrictions under Presidential Decree No. 715.[9] · DOJ / SEC

Module B. Tax registration and BIR compliance

Philippine tax obligations attach from the first day a foreign entity conducts business within Philippine territory — not from the date of SEC registration. All entities must register with the Bureau of Internal Revenue (BIR), obtain a Tax Identification Number (TIN), and enroll in the appropriate tax types under the National Internal Revenue Code (RA 8424, as amended).

BIR Certificate of Registration obtained; correct tax types enrolled including income tax, VAT (or percentage tax), expanded withholding tax, and documentary stamp tax. 10] · BIR

Branch Profit Remittance Tax (BPRT) at 15% applied to profits remitted to foreign head office, unless a lower rate applies under an applicable tax treaty (verified with BIR International Tax Affairs Division) · BIR / ITAD

Transfer pricing documentation prepared for all related-party transactions in accordance with Revenue Regulations No. 2-2013 and OECD Transfer Pricing Guidelines; contemporaneous documentation maintained. [11] · BIR

Expanded withholding tax (EWT) computed and remitted correctly on all applicable payments — professional fees, rentals, commissions, and payments to non-residents — per Revenue Memorandum Order No. 23-2023.[12] · BIR

VAT compliance verified: 12% VAT applied on taxable sales; input VAT claims supported by valid BIR-registered receipts; VAT refund applications filed within two-year prescriptive period · BIR

eBIRForms and ePayment systems used for all mandatory electronic filings; Large Taxpayer Division (LTD) enrollment assessed if annual gross sales exceed ₱1 billion.[13] · BIR

Tax treaty relief applications (TTRA) filed in advance for non-resident income payments — dividends, interest, royalties — to avoid over-withholding; ITAD processing timeline of 4–6 months planned accordingly. [14] · BIR / ITAD

Philippine-sourced income properly identified and declared: all income with a Philippine source situs is taxable in the Philippines regardless of where the contract was signed or payment received · BIR

Transfer pricing alert — 2025

The BIR's dedicated Transfer Pricing Audit Unit intensified assessments in 2024–2025, focusing on intercompany service fees, royalty arrangements, and related-party loans. All foreign-owned entities with related-party transactions exceeding ₱3 million annually are required to submit BIR Form No. 1709 (Related Party Transactions form) with their annual income tax return.

Module C. Labor law and employee benefits

The Labor Code of the Philippines (Presidential Decree No. 442) [15] establishes minimum standards that cannot be contracted away. Foreign companies that apply home-country HR policies without local legal review are among the most frequently cited violators in DOLE compliance inspections.

All employees working continuously for six months recognized as regular employees, irrespective of contract language; no rolling short-term contracts used to defer regularization.[15] · DOLE

Independent contractors assessed against DOLE Department Order No. 174-17 "four-fold test"; workers exercising control, using company equipment, and integrated into operations reclassified as employees · DOLE

13th-month pay computed correctly as 1/12 of total basic salary earned during the calendar year and paid on or before December 24 under Presidential Decree No. 851.[17] · DOLE

SSS contributions (employer + employee) remitted monthly per current contribution schedule under RA 11199; contribution rate increases scheduled through 2025 applied. · SSS

PhilHealth contributions remitted at current rate (5% of monthly basic salary as of 2025, shared equally between employer and employee) under RA 11223 · PhilHealth

Pag-IBIG/HDMF contributions remitted at correct mandatory rate for all employees earning above minimum wage, under RA 9679.[20] · HDMF

Regional minimum wage compliance verified against current Wage Order for each region where employees are based; NWPC wage orders reviewed for any mid-year adjustments · NWPC / DOLE

Telecommuting policy established in writing, registered with DOLE, and aligned with RA 11165 (Telecommuting Act) — mandatory for companies with permanent remote work arrangements. [22] · DOLE

2026 note — expatriate employment

Foreign nationals employed in the Philippines require an Alien Employment Permit (AEP) from DOLE before commencing work. The AEP must be renewed annually and is activity-specific — a change in role or employer requires a new application. Failure to secure an AEP for foreign employees is a recurring DOLE inspection finding.[23]

Module D. Investment incentives — PEZA, BOI, and CREATE Act

The Corporate Recovery and Tax Incentives for Enterprises Act (CREATE, RA 11534)[2] restructured the entire Philippine investment incentive system. Tax Holiday and preferential tax rate entitlements now flow through the Fiscal Incentives Review Board (FIRB),[24] which conducts post-registration audits of all registered business enterprises (RBEs).

PEZA, BOI, CEZA, or other Investment Promotion Agency (IPA) registration secured before commencing incentivized activities; registered activity description precisely matches actual operations.[25] · PEZA / BOI

PEZA-registered entities maintaining minimum 70% export ratio; domestic market sales not exceeding 30% threshold without prior PEZA approval; export reports filed quarterly.[25] · PEZA

Any change in registered product line, production capacity, or activity secured prior PEZA/BOI written approval; unapproved expansions or modifications flagged in internal compliance calendar.[25] · PEZA / FIRB

Income Tax Holiday (ITH) period tracked precisely; transition to 5% Special Corporate Income Tax (SCIT) or Enhanced Deductions (ED) regime managed before ITH expiry to avoid inadvertent full corporate income tax exposure · BIR / FIRB

Annual performance reports submitted to PEZA/BOI on schedule; FIRB post-registration audit requirements monitored and documentation maintained.[24] · FIRB

VAT zero-rating on local purchases applicable to PEZA-registered entities: ensure suppliers hold valid BIR authority to zero-rate; obtain required certifications from PEZA before relying on zero-rating treatment. · BIR / PEZA

"CREATE Act incentives do not operate automatically. They require registration, performance, and reporting — in that order. Companies that claim the tax benefit without maintaining the underlying obligation are the primary targets of FIRB audits in 2025 and 2026."

Module E. Business permits, local government, and sector licenses

Beyond national regulatory compliance, foreign companies must navigate Local Government Unit (LGU) requirements — each of which operates on distinct timelines and procedures. The Ease of Doing Business Act (RA 11032) [34] mandates streamlined processing, but practical timelines vary significantly by municipality and city.

Mayor's Permit / Business Permit obtained from the relevant LGU for each place of business; renewed annually in January; additional locational clearances secured for each branch or satellite office.[34] · LGU

Barangay Clearance secured from the barangay where each place of business is located, as a prerequisite for Mayor's Permit application.[34] · LGU / Barangay

Department of Trade and Industry (DTI) business name registration obtained where applicable; sector-specific licenses secured — BSP license for fintech/lending, IC license for insurance, FDA license for food/pharma/medical devices. · DTI / BSP / IC / FDA

Fire Safety Inspection Certificate (FSIC) and Sanitary Permit obtained from local fire bureau and health office respectively, where required for physical premises. · BFP / LGU

Local business taxes assessed and paid to the relevant LGU; local franchise taxes for specific sectors confirmed with LGU Revenue Code. · LGU

Ease of doing business — 2026 update

Under RA 11032, LGUs are mandated to process business permit renewals within three working days for simple transactions. The Anti-Red Tape Authority (ARTA) actively receives complaints against LGUs that exceed prescribed processing timelines. Foreign companies encountering unreasonable delays may file a complaint directly with ARTA.[34]

Key principle for 2026

Compliance in the Philippines is not a one-time event — it is a continuous operating discipline. Regulatory calendars change, wage orders are issued mid-year, BIR memoranda revise withholding procedures, and SEC circulars introduce new disclosure obligations on short notice. Foreign companies that treat compliance as an annual exercise rather than an embedded management function are consistently the ones who face enforcement actions. Build the system first; the filings will follow

References and legal basis

[1] Republic Act No. 11232. Revised Corporation Code of the Philippines. Manila: Congress of the Philippines, 2019. sec.gov.ph

[2] Republic Act No. 11534. Corporate Recovery and Tax Incentives for Enterprises (CREATE) Act. Manila: Office of the President, 2021. Implementing Rules: Revenue Regulations No. 5-2021.

[3] Republic Act No. 11595. Retail Trade Liberalization Act Amendment. Manila: Congress of the Philippines, 2021.

[4] Republic Act No. 11647. Amending the Foreign Investments Act of 1991 (RA 7042). Manila: Congress of the Philippines, 2022. Foreign Investment Negative List updated via Executive Order. dti.gov.ph

[5] Securities and Exchange Commission. MC No. 3, Series of 2021: Guidelines on Assigned and Remitted Capital for Foreign Corporations. Pasay City: SEC, 2021. sec.gov.ph

[6] Securities and Exchange Commission. MC No. 1, Series of 2023: Revised Reportorial Requirements for Foreign Corporations. Pasay City: SEC, 2023.

[7] Financial Reporting Standards Council (FRSC). Philippine Financial Reporting Standards (PFRS), 2024 edition. Manila: FRSC / Board of Accountancy, 2024. frsc.gov.ph

[8] Securities and Exchange Commission. MC No. 6, Series of 2022: Guidelines on Beneficial Ownership and Control Disclosure. Pasay City: SEC, 2022.

[9] Presidential Decree No. 715. Anti-Dummy Law Amendment (Amending Commonwealth Act No. 108). Manila: Office of the President, 1975.

[10] Republic Act No. 8424 as amended by RA 10963 (TRAIN) and RA 11534 (CREATE). National Internal Revenue Code of the Philippines. Quezon City: Bureau of Internal Revenue. bir.gov.ph

[11] Bureau of Internal Revenue. Revenue Regulations No. 2-2013: Transfer Pricing Guidelines. Quezon City: BIR, 2013. See also: BIR Revenue Memorandum Circular No. 76-2020 (BIR Form 1709 mandatory submission). bir.gov.ph

[12] Bureau of Internal Revenue. Revenue Memorandum Order No. 23-2023: Withholding Tax on Payments to Non-Resident Foreign Corporations. Quezon City: BIR, 2023.

[13] Bureau of Internal Revenue. Revenue Regulations No. 6-2014: eBIRForms System and Electronic Filing Requirements. Quezon City: BIR, 2014, updated 2023.

[14] Bureau of Internal Revenue — International Tax Affairs Division (ITAD). BIR Ruling No. OT-001-2021: Procedures for Tax Treaty Relief Applications. Quezon City: BIR, 2021.

[15] Presidential Decree No. 442. Labor Code of the Philippines, as amended. Manila, 1974. Current codified edition: 2023.

[16] Department of Labor and Employment. Department Order No. 174, Series of 2017: Rules on Contracting and Subcontracting. Manila: DOLE, 2017.

[17] Presidential Decree No. 851. Requiring All Employers to Pay Their Employees a 13th-Month Pay. Manila, 1975. DOLE Explanatory Bulletin, 2023 edition.

[18] Republic Act No. 11199. Social Security Act of 2018. Manila: Congress of the Philippines, 2018. Current contribution schedule: SSS Circular No. 2023-004. sss.gov.ph

[19] Republic Act No. 11223. Universal Health Care Act. Manila: Congress of the Philippines, 2019. Current contribution schedule: PhilHealth Circular No. 2023-0022. philhealth.gov.ph

[20] Republic Act No. 9679. Home Development Mutual Fund Law of 2009 (Pag-IBIG Fund Act). Manila: Congress of the Philippines, 2009. pagibigfund.gov.ph

[21] National Wages and Productivity Commission. Regional Wage Orders 2024–2025. Manila: NWPC/DOLE, 2024. nwpc.dole.gov.ph

[22] Republic Act No. 11165. Telecommuting Act. Manila: Congress of the Philippines, 2018. DOLE Department Order No. 202, Series of 2019 (Implementing Rules).

[23] Department of Labor and Employment. DOLE Department Order No. 221-21: Revised Rules and Regulations on the Issuance of Alien Employment Permit (AEP). Manila: DOLE, 2021.

[24] Fiscal Incentives Review Board. FIRB Resolution No. 001-2022: Rules of Procedure on Post-Registration Audit and Monitoring. Manila: Department of Finance / FIRB, 2022. firb.gov.ph

[25] Philippine Economic Zone Authority. PEZA Rules and Regulations on Registered Activities, Export Ratios, and Performance Reporting. Pasay: PEZA, updated 2024. peza.gov.ph

[26] Bureau of Internal Revenue / PEZA. Revenue Memorandum Circular No. 74-99 and related issuances on VAT zero-rating for PEZA-registered locators, as updated by CREATE Act implementing rules.

[27] Financial Action Task Force (FATF). Jurisdictions No Longer Subject to Increased Monitoring — Philippines. Paris: FATF, February 2023. fatf-gafi.org

[28] Republic Act No. 9160, as amended by RA 9194, RA 10167, RA 10365, RA 10927, and RA 11521. Anti-Money Laundering Act of 2001 (consolidated). Manila: Congress of the Philippines.

[29] Anti-Money Laundering Council. 2023 Revised Implementing Rules and Regulations of the AMLA. Manila: AMLC, 2023. amlc.gov.ph

[30] Republic Act No. 10173. Data Privacy Act of 2012. Manila: Congress of the Philippines, 2012. Implementing Rules and Regulations: NPC, 2016, updated 2023.

[31] National Privacy Commission. NPC Advisory No. 2023-01: Registration of Data Processing Systems and Data Protection Officers. Manila: NPC, 2023. privacy.gov.ph

[32] National Privacy Commission. NPC Circular No. 2023-04: Rules on Cross-Border Transfer of Personal Data. Manila: NPC, 2023.

[33] National Privacy Commission. NPC Circular No. 2022-01: Personal Data Breach Management. Manila: NPC, 2022.

[34] Republic Act No. 11032. Ease of Doing Business and Efficient Government Service Delivery Act of 2018. Manila: Congress of the Philippines, 2018. Administered by ARTA: arta.gov.ph