QuestionsQuestions (Republic Act No. 11647)
It declares the policy of the State to attract, promote, and welcome productive foreign investments consistent with the Constitution and national security, to encourage investments that expand livelihood/employment for Filipinos, enhance agricultural products’ value, promote Filipino consumer welfare, expand and improve exports, and transfer relevant technologies in agriculture, industry, and support services—while emphasizing accountability and integrity in public office and the principles of transparency, reciprocity, equity, and economic cooperation.
“Investment” means equity participation in a Philippine enterprise duly recorded in the enterprise’s stock/transfer book or equivalent registry of ownership. “Foreign investment” means an equity investment made by a non-Philippine national through foreign exchange and/or other assets actually transferred to the Philippines and duly registered with the Bangko Sentral ng Pilipinas.
It is an activity or undertaking rendered and performed by a registered and duly licensed professional or holder of a special temporary permit as defined by the scope of practice in the relevant professional regulatory law.
It refers to the sector including transport of goods or materials through a pipeline such as crude, refined petroleum, natural gas, biofuels, and other chemically stable substances.
DTI leads as the IIPCC’s lead agency and its Secretary presides as Chairperson. It includes representatives from DOF, DTI-BOI, DTI-PEZA, DFA (OUMAIER), NEDA, DICT, CHED, TESDA, and four regional representatives (NCR, Luzon, Visayas, Mindanao) chosen from industry/chambers. The BOI serves as secretariat implementing policies and resolutions.
Coordination/partnering with other investment authorities is expressly stated not to include the administration, design, and grant of fiscal incentives.
Examples include: (1) establishing a medium-and-long-term Foreign Investment Promotion and Marketing Plan (FIPMP); (2) designing a comprehensive marketing strategy/campaign; (3) supporting inbound/outbound foreign direct and trade missions; (4) encouraging R&D in priority areas indicated by the FIPMP; (5) monitoring actual performance against measurable timebound targets (including job generation); (6) submitting annual evaluation/reports to the President and Congress; (7) establishing/updating an online database with ready local partners; and (8) supporting LGU efforts to promote foreign direct investments and expedite compliance.
A comprehensive and strategic FIPMP developed by the IIPCC covering a medium five-year plan and a long-term ten-year plan.
It must be based on competitive advantages, natural resources, skill and educational development, traditional linkages, and international market potential. It must be fully consistent with the strategic investment priorities plan under Title XIII of the National Internal Revenue Code (as amended).
No prior approval is required, provided the non-Philippine national is not disqualified by law. The person may register with the SEC (or DTI for single proprietorships) and then do business as defined in the law or invest up to 100% of capital, unless participation is prohibited or limited by existing law and/or the Act. The SEC/DTI cannot impose additional limitations on foreign ownership beyond those in the Act.
It must apply for registration with the BOI, which will process the application for registration according to the criteria for evaluation prescribed in the Omnibus Investments Code.
The applicant must disclose the fact of such existing joint venture and provide the names and addresses of the partners in the existing joint venture in the application for registration with the SEC.
If a foreign export enterprise fails to meet the export ratio requirement, the SEC or DTI orders it to reduce its sales to the domestic market to not more than 40% of its total production. Continued failure without justifiable reason may lead to cancellation of its SEC/DTI registration and/or penalties under Section 14.
The law provides categories reserved to Philippine nationals under the Foreign Investment Negative List, including defense-related activities requiring prior clearance/authorization from the DND (e.g., manufacture/repair/storage/distribution of firearms, ammunition, lethal weapons, military ordinance, explosives, pyrotechnics, and similar materials) unless authorized by the Secretary of National Defense.
Non-Philippine nationals may participate if: (1) the enterprise involves advanced technology as determined by DOST; or (2) it is endorsed as a startup/startup enabler by the lead host agencies under R.A. No. 11337; or (3) a majority of direct employees are Filipinos with at least 15 Filipino employees, but in all cases non-Philippine participation still requires a minimum paid-in capital of at least US$100,000.
When ordered by the President, in coordination with the NSC and NEDA, to review foreign investments involving military-related industries, cyber infrastructure, pipeline transportation, or other activities that may threaten territorial integrity and safety/security/well-being of Filipinos—specifically if made by a foreign government-controlled entity/state-owned enterprise (with exceptions for independent pension funds, sovereign wealth funds, and multinational banks) or located in geographical areas critical to national security.
It requires public officials/employees involved in foreign investment promotions to uphold accountability and integrity and states that any public official/employee who commits acts under Section 3 of R.A. No. 3019 will, in addition to penalties under Section 9(a) of R.A. No. 3019, be punished by a fine of not less than P2,000,000 and not more than P5,000,000.
The Act does not apply to banking and other financial institutions governed by R.A. No. 8791 (and other laws under BSP supervision). It also does not apply to practice of professions covered by specific laws under the jurisdiction of Professional Regulatory Boards (PRBs) or equivalent regulators, or those subject to reciprocity agreements with other countries. Other occupations not covered and not subject to reciprocity must comply with the Act, provided necessary licenses/work permits/visas are properly secured.