How To Open A Business Philippines From Australia

How To Open A Business In The Philippines From Australia: With the developing cities and unspoiled beaches across this beautiful country, it’s no surprise that many Australians are looking to start a business in the Philippines. But starting a business in a foreign land is not the easiest. Luckily, we will be addressing how to open a business in the Philippines from Australia with this guide.

Firstly, if you want to open a business in Australia and not physically be in the Philippines, it is possible but extremely challenging. This is because you need a representative in the Philippines to complete all the paperwork and registration. In addition, there may need an I.D and signatures from you that are needed, which can slow down the process if you are not in the Philippines.

Most of the time, businesses opened without the business CEO in the Philippines are large corporations with large business capitals. Nevertheless, let’s now take a look at the next stage is on how to open a business in the Philippines from Australia.

Table of Contents

How To Open A Business In The Philippines From Australia

The next stage includes the step-by-step process of registering a business in the Philippines as an Australian. Then, if you have a representative for your business, you can replace the word “You” with him/her.

Research The Market And Industry, Including Rules And Regulations

The first stage is of starting a business in the Philippines from Australia is to research the market and industry. Not only is this incredibly important for your business, but it also impacts the process of registering a business.

For example, if you decide to set up a new company in the Philippines, you will be the company’s president. But you may have more or less ownership of the company depending on the rules and regulations of the industry.

If you sell coconuts abroad and export, your ownership will be much higher than selling to a domestic audience in the Philippines. Please take a look at the business law in the Philippines for more information (but we have addressed this below also).

Additionally, some industries may require additional registration or certificates before opening a business. Therefore some businesses can be opened in a short amount of time while some take a lot longer.

Find A Business Lawyer In The Area Where You Plan To Do Business

The first physical stage of opening a business in the Philippines from Australia is to find a business lawyer to help you register and open your business. This is not mandatory; however, it is recommended as the process can be complex depending on what type of business you are opening in the Philippines.

In the Philippines, business lawyers work in their jurisdiction. Meaning that if you are starting a business in Cebu city, you will need to hire a business lawyer who works and specializes in Cebu.

Prices will differ from lawyer to lawyer. Unfortunately, foreigners are known to be charged a lot higher than local citizens, so it’s best to shop around and negotiate if needed.

Find A Suitable Business Location

One of the exciting moments of registering a business in the Philippines as a foreigner is choosing the location. Some fantastic commercial properties across the Philippines are perfect for officers, start-ups, and large corporations.

You may wish to investigate your location options sooner rather than later. This is because in the Philippines when you are registering and setting up a new business, government officials will need to know the physical location of your business at the time of registration. Of course, this can always be changed, but a location needs to be agreed upon.

Choose And Register A Business Name

BIR & DTI are two departments that we will speak about in a moment. At this stage, however, the business name needs to be registered. You will need to confirm that the name is available to do this. Once this has been completed, you can fill in the registered form online, pay a fee, and download your certificate.

Starting a business in the Philippines from Australia can be completed on the following link – Business Name Registration – BNRS Portal – DTI.

Register Your Documents At SEC

SEC Stands for the security and Exchange Commission. Their registration system is fully automated, and the online process is straightforward. Similar to registering the business name, you will need to fill out the forms online, pay the fees and move on to the next stage.

Obtain Mayor Business Permits

The next stage will require you or your representative to pop into the city’s local business permits and licensing office. Again, this will depend on what city you are doing business in. You can then submit the details and pay the relevant fees.

Obtain BIR Registration

BIR stands for the Bureau of Internal Revenue Philippines. This is one of the last stages you will need to do as there are certain requirements the Bureau of Internal Revenue will want.

These documents include your certification from DTI / Barangay clearance and mayors permit/certificates of lease of the property you are renting and, finally, some forms of identification such as a passport. Once you have these, you can begin the process that starts with filling in the BIR 1901 form.

Fill In The BIR Form 1901

Go To Your Respective Revenue District Office
Pay Registration Fees
Claim Your Certificate Of Registration

Purchase And Register Your Books Of Account
Secure An Authority To Print

Register For Philhealth & SSS

The last stage of understanding business in the Philippines from Australia covers the step of PhilHealth and SSS. PhilHealth is the government-operated healthcare system for the Philippines. SSS is the Social Security system of the Philippines.

SSS Can be completed by registering online. Employees need to complete the employee registration form (S.S. Form R-1), which needs to be submitted with the specimen signature card (L-501).

As a foreign-owned company, the supporting documents you will need are the following;

Approved Articles of Incorporation from SEC; and
License to Transact Business in the Philippines from SEC

In regards to PhilHealth, you need to register and submit the employer data record (ER1) and the membership registration form for each employee. At this moment in time, this can only be completed by visiting a local PhilHealth office.

What Type Of Business Can Australians Do In The Philippines

Australians and foreigners, in general, can start all kinds of business in the Philippines; however, the type of business can impact the ownership of the company and regulations of the business.

For example, to start a business focusing on the domestic market (selling to locals and making money on the land of the Philippines), You will need minimum start-up capital of 200,000 USD (276,400 AUD).

If you do not have this capital, you can be a part-owner of the company, even if it’s a low amount, such as 1%. However, without the minimum capital, you will not be able to be president, and you will not be able to own more than 40% of the business, but there are grey areas around this which we will speak about below.

The easiest type of business for Australians to start in the Philippines has an exporting element. In other words, businesses that gain their money overseas and bring it into the Philippines. In these scenarios, start-up capital can be as low as 5000 pesos (lowest registration fee for a corporation in the Philippines). You will be able to own up to 100% of the business.

These businesses include call centers such as outsourcing and exporting businesses. So, in theory, if you were to start an outsourcing call center, the registration fee would be much lower, and ownership of the business will be much higher.

What Capital Is Needed To Start A Business In The Philippines From Australia

200,000 USD (276,400 AUD) is needed to register a business in the Philippines as a foreigner. However, this total capital amount can be much lower depending on the type of business. Suppose more than 60% of your total income comes from overseas. In that case, it is possible to have higher ownership and less capital when registering the business in the Philippines as a foreigner.

Is Starting A Business In The Philippines A Good Idea For Australians?

The Philippines possess many advantages for Australian business owners, not only for importing and exporting but also for its domestic markets.

The Philippines, in general, is still developing, and there is a lot of growth that is expected to come over the upcoming years. So whether starting a business in the Philippines from Australia is a good idea or not comes down to the individual and their business concept.

Despite the benefits and opportunities, things can be quite challenging for business owners in the Philippines. Now, let’s take a look at some challenges that you may wish to investigate before starting a business in the Philippines as an Australian.

What Challenges Await Australian Business Owners In The Philippines?

One of the biggest challenges is finding trustworthy and suitable business partners. In most situations, a business owner will need to hire local staff, and some of these may need to be officially on the record of business, which means that if you are a president, you will need to find a vice president and so on.

These roles that are necessary for starting a business in the Philippines come with the elements of authority. Because of this, finding the right business partners for your new business can be one of the first challenges.

Another challenge is finding the right business lawyer. Some lawyers are fantastic, but unfortunately, some do not know all the rules. As a foreigner, it took me 5 visits before I found someone who knew more information than I did. The ones before him did not know about the grey areas, which is why finding the best lawyer can pay off for you in the long term.

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