How to Set up a One Person Corporation in the Philippines for Foreign Entrepreneurs

How to Set up a One Person Corporation in the Philippines for Foreign Entrepreneurs

How to Set up a One Person Corporation in the Philippines for Foreign Entrepreneurs


One Person Corporation in the Philippines

For entrepreneurs looking to start a business, there is a near-universal question that needs to be answered — to begin as a sole proprietorship or create a corporation?

A sole proprietorship offers freedom and simplicity, while a corporation protects limited liability. For many, the ideal business structure lies somewhere in between the two.

Thankfully, in February 2019, Republic Act No. 11232, otherwise known as the Revised Corporation Code of the Philippines (RCC) was introduced, and with it, the One Person Corporation (OPC).

The OPC allows a single person (citizen or foreign) to form a corporation without the need for a board of directors or shareholders. With an OPC, the company owner is the director, sole shareholder, and president. 

Let’s take a look at how you can set up a One Person Corporation in the Philippines. We’ll look at exactly what an OPC is, the pros and cons of an OPC, and what’s required in terms of documentation and registration. 

  1. What is One Person Corporation in Philippines
  2. Bond requirements
  3. Who can set up a One Person Corporation
  4. Who is not allowed to set up a One Person Corporation
  5. Pros & Cons of  One Person Corporation
  6. Required documents to set up One Person Corporation
  7. Filing fees for One Person Corporation
  8. Steps to register a One Person Corporation

What is a One Person Corporation?

A One Person Corporation (OPC) is simply a company with just one stockholder. This single stockholder is also the sole incorporator, director, and president.

This single stockholder’s liability is limited to the extent of their assets, combining the best of both worlds between a sole proprietorship and a limited liability company.   

An OPC’s company name will have the suffix “OPC” either below or at the end of its corporate name.

Favourably, and OPC does not need a minimum capital stock, except where specified by law. This extends to foreigners looking to set up an OPC in the Philippines — as long as laws and regulations are met, there should not be any minimum capital stock requirements.

An OPC also will not need to pay up a portion of any capital stock at the time of incorporation, except specified by law. 

An OPC does need to appoint some administrative staff, however:

  • A Corporate Secretary must be appointed within 15 days from the date of incorporation
    • The Corporate Secretary cannot be the single stockholder
    • The Corporate Secretary must be a Filipino citizen
  • A Treasurer must be appointed within 15 days from the date of incorporation
    • The Treasurer can be the single stockholder if they file a surety bond with the Securities and Exchange Commission (SEC)
    • The Treasurer is required to be a resident of the Philippines
  • A Nominee and Alternate Nominee to take over management and operation in the event of the single stockholder’s death or incapacity

What Are the Bond Requirements for a Self-Appointed Treasurer?

If the director/single stockholder of the OPC decides to become the self-appointed treasurer, they will need to submit a surety bond that is based on their capital stock. Values are in Philippine Peso (₱).

  • ₱1 to ₱1,000,000 of Authorised Capital Stock 
    • ₱1,000,000 Surety Bond 
  • ₱1,000,000 to ₱2,000,000 of Authorised Capital Stock
    • ₱2,000,000 Surety Bond 
  • ₱2,000,000 to 3,000,000 of Authorised Capital Stock
    •  ₱3,000,000 Surety Bond 
  • ₱3,000,000 to ₱4,000,000 of Authorised Capital Stock
    • ₱4,000,000 Surety Bond
  • ₱4,000,000 to ₱5,000,000 of Authorised Capital Stock
    • ₱5,000,000 Surety Bond
  • ₱5,000,000 or more of Authorised Capital Stock 
    • Surety Bond to be equal to OPC’s authorised capital stock

Who Can Form an OPC in the Philippines?

  • A natural person of legal age (local or foreign)
  • A trust**
  • An estate

Please note, a foreign natural person can start up an OPC, under limitations in areas of investment partially or completely restricted from foreign involvement or as specified in the Foreign Investments Negative List (FINL).

Additionally, in this scenario, a trust does not refer to a trust entity, but rather to the subject being managed by a trustee. 

Related Read: How to Set up Domestic Corporation in the Philippines »

Who Cannot Form an OPC in the Philippines?

  • Natural persons licensed to exercise a profession (if the OPC is to operate in this profession)
  • Public and publicly-listed companies
  • Pre-need, trust, and insurance companies
  • Banks, non-bank financial institutions, and quasi-banks
  • Non-chartered Government-Owned and Controlled Corporations (GOCCs)

What are the Pros and Cons of an OPC in the Philippines?

Pros of an OPC in the Philippines:

  • Limited liability (only the legal entity of the company is liable for its debts, rather than the director as a person)
  • Perpetual existence (despite bankruptcy, transfer of shares, change of director, etc.)
  • Complete control of the business (more like a sole proprietorship rather than a traditional corporation with a board of directors)
  • No minimum capital requirements (unless stated by law)
  • An existing corporation can restructure as an OPC (if a single stockholder acquires all shares of the company)

Pros of an OPC in the Philippines:

  • More complex than a sole proprietorship (due to more administration requirements)
  • Some limitations on foreign ownership (a foreigner cannot incorporate an OPC in an industry included on the Foreign Investments Negative List)
  • Tax obligations are subjective on a case-to-case basis (most sole proprietorships only pay 8% income tax, while the corporate income tax rate is 30% — however, there are many more tax benefits that come with a corporation)

What Documents Are Required to Register an OPC in the Philippines?

  • Articles of Incorporation, including:
    • Names and details of the single stockholder
    • Primary purpose
    • Term of existence
    • Principal office address
    • Nominee and alternate nominee
    • The authorized, subscribed, and paid-up capital
    • Other matters that are consistent with the law and may be necessary and convenient
  • Consent in writing from the Nominee and Alternate Nominee
  • Other requirements (if applicable by case)
    • Foreign Investments Act (FIA) Application Form (for use by foreign natural persons)
    • Authority to Act on Behalf of the Estate or Trust (for use by estates and trusts incorporating as an OPC)
    • Affidavit of Undertaking to Change Company Name (in the case this is not included in the Articles of Incorporation)
    • Tax Identification Number (TIN) for a Filipino citizen director
    • Passport Number or Tax Identification Number (TIN) for a foreign director

What Are the Filing Fees for Registering an OPC?

  • Articles of Incorporation – 0.5 per cent of the authorised capital stock (but no less than ₱2,000)
  • Name Reservation – ₱100.00 per company name/trade name
  • FIA Application Fee – ₱3,000.00 if applicable 
  • Legal Research Fee (LRF) – 1 percent of the Registration/Filing Fee (but no less than ₱20)
  • Documentary Stamp – ₱30

What Are the Steps for Registering an OPC?

  1. Submit your proposed company name to SEC
  2. Submit your documents to SEC for pre-processing
  3. Pay any applicable filing fees
  4. Submit hard copies of signed and notarized documents with proof of payment of applicable filing fees 
  5. Claim Certificate of Registration from SEC

If your company name is rejected (i.e. it is already in use, it is deemed inappropriate, etc.), you may submit a Letter of Appeal to the SEC.

As mentioned earlier, you must appoint a treasurer, corporate secretary, and other officers within 15 days of the issuance of your Certificate of Registration. 

Conclusion — What’s Next for Incorporating Your OPC in the Philippines? 

While we are not able to go into depth within this relatively short article, one thing is clear — an OPC creates an organisational structure that keeps the best of both worlds. With an OPC you have the freedom and control of a sole proprietorship, all while keeping the limited liability benefits of a traditional corporation. 

We would consider incorporating an OPC of moderate complexity, so we highly recommend you talk to a trusted and competent company incorporation service provider. 

With the right assistance, incorporating an OPC in the Philippines can be virtually seamless, saving you time, money, and stress.



Incorporate a Company in the Philippines

The Philippines is set to enjoy 6.5% GDP growth in 2021, so now is the time to start putting concrete plans in place to expand your company and start doing business in the Philippines.

The Philippines saw the trend for growth in 2019, when it passed into law the Revised Corporation Code, which seeks to make company incorporation easier and with fewer restrictions. The plan, of course, is to be on equal standing with economic powerhouse neighbours Singapore and Hong Kong — so this may be the perfect time to expand your business into the Philippines while it’s on the onset of a major business climate reform.

While the Philippine Government has made large strides in opening its economy to foreign investors, there are still some factors to consider. With that in mind, let’s take a look at how you can go about incorporating a company in the Philippines in 2021.

Please note that while there are many forms of business entities available in the Philippines (with their own requirements), this article will only focus on incorporating a domestic corporation, which is similar to a limited liability company.

  1. Requirements to Incorporate Company
  2. 5 Steps to Incorporate Company

What Are the Requirements for Incorporating a Company in the Philippines?

Executive Breakdown

  • Two to 15 directors or incorporators (majority need to reside in the Philippines)
  • A minimum of four officeholders:
    • President acting as the company’s signatory (does not have to be a resident of the Philippines)
    • Corporate Secretary in charge of the company’s administration (must be a resident of the Philippines)
    • Treasurer  in charge of the company’s finances (must be a resident of the Philippines)
    • Compliance Officer

Foreign Equity

A domestic corporation in the Philippines may have foreign equity, which is broken down into three brackets:

  • >40.01% Foreign Equity
  • <40% Foreign Equity
  • 0% Foreign Equity (100% Filipino-owned)

Capital Requirements

Capital requirements are dependent on the foreign equity bracket mentioned above:

  • 0% Foreign Equity → US$100 or approximately ₱5,000
  • <40% Foreign Equity → US$100 or approximately ₱5,000
  • >40.01% Foreign Equity → US$200,000 or approximately ₱4,800,000

Capital can be injected once the company has acquired a local bank account.

Capital requirements can be reduced by:

  • Employing a minimum of 50 Filipino citizens → minimum capital requirement of US$100,000 or approximately ₱2,400,000
  • Can prove use of advanced technology in the company’s operations → minimum capital requirement of US$100,000 or approximately ₱2,400,000
  • Exporting at least 70% of product → minimum capital requirement of US$100 or approximately ₱5,000

What Are the Steps for Incorporating a Company in the Philippines?

1. Register your Business with the SEC

The Philippine Securities and Exchange Commission (SEC) has quite a mature online system for reserving and registering your company name and details. Simply create an account in the SEC’s Company Registration System to check if your desired company name is available, and then reserve/register that name.

If preferred, you can also reserve and register your company name at SEC’s Name Verification Unit in their office in Mandaluyong.

During this process, you will also need to provide the following documents to SEC:

  • Your company’s Articles of Incorporation and By-laws
  • Joint Affidavit of two incorporators
  • Your company’s Treasurer’s Affidavit

If your application is approved, SEC will issue a Certificate of Registration to legitimize your company’s existence and allow you to start doing business in the Philippines.

2. Obtain Clearance from the Barangay

The Barangay is the district of your chosen region in charge of administration for the local government. Any business formed therein will need to have the local Barangay’s approval.

Your application for Barangay Clearance will require:

  • Your Certificate of Registration from SEC
  • Two valid forms of identification
  • Proof of Address of your company’s local office (can be Certificate of Land Title or Lease Contract)

3. Get Your Company’s Business Permit From the Local Mayor’s Office

For this step you will have to visit your municipality’s local office and request a business permit. Along with your business permit application, you will also need to provide:

  • Your Certificate of Registration from SEC
  • Two valid forms of identification
  • Proof of Address of your company’s local office (can be Certificate of Land Title or Lease Contract)
  • Your Barangay Clearance

4. Register Your Company With the Bureau of Internal Revenue

As part of your tax obligations in the Philippines, you’ll need to register your new company with the Bureau of Internal Revenue (BIR). To receive your company’s Taxpayer Identification Number (TIN), you’ll need to visit your company’s local Regional District Office (RDO) and do the following:

  • Accomplish BIR Form 1903 – Application for Registration (For Partnerships/Corporations)
  • In conjunction with your BIR Form 1903, submit your previously completed:
    • Certificate of Registration from SEC
    • Your company’s Barangay Clearance
    • Your company’s Business Permit from the Mayor’s Office
    • Proof of Address (Certificate of Land Title or Lease Contract)
    • Valid IDs, if required
  • If applicable, pay for your company’s Registration Form (BIR Form 0605) and Documentary Stamp Tax (BIR Form 2000)
  • Register your account books and up-to-date invoices
  • Finally, wait for your BIR Certificate of Registration (BIR Form 2303) to be issued

5. Register as an Employer

Finally, you need to register as an employer with the following government agencies:

  • S Security System (SSS) (for social security)
  • Philippine Health Insurance Corporation (PhilHealth) (for health benefits)
  • Home Development Mutual Fund (HDMF or Pag-IBIG Fund) (for housing loan benefits)

Conclusion — Where to Next for Incorporating Your Business in the Philippines

The Philippine Government has made legitimate leaps and bounds in terms of simplifying the company incorporation process, with the express intention of making it easier for foreigners to do business in the Philippines.

However, while reasonably simple, it does take a large investment of your time that could be used better elsewhere, namely the running of your existing business.

If you’d like to make the incorporation process completely seamless, we advise you to use a registered and reputable incorporation service provider in the Philippines.

We’ve made an effort to give you as much free information as possible in this article, but if you have any questions about incorporating your company in the Philippines, ask us below.

We’ve been doing this for a long time all around Southeast Asia, so we’re sure to be able to save you time, money, and headaches.

If you’d like a personal consultation to advise on your move to the Philippines, please do contact us, it’s both our job and pleasure to help.


 BGC and Co. CPAs can help your organization in choosing the best structure for your business endeavours.


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• Securities and Exchange Commission (SEC);
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• VISA extension;
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