QuestionsQuestions (Republic Act No. 11647)
The State’s policy is to attract, promote, and welcome productive foreign investments that significantly contribute to sustainable, inclusive, resilient, and innovative economic growth, productivity, global competitiveness, employment creation, technological advancement, and countrywide development—consistent with the Constitution, relevant laws, and national security protections. It also emphasizes accountability and integrity in public office and requires foreign investments to be based on transparency, reciprocity, equity, and economic cooperation.
It defines “investment” as equity participation duly recorded in the enterprise’s stock/transfer book (or equivalent registry of ownership). “Foreign investment” is defined as equity investment made by non-Philippine nationals in the form of foreign exchange and/or other assets actually transferred to the Philippines and duly registered with the BSP. “Practice of profession” refers to activities performed by a registered and duly licensed professional or holder of a special temporary permit under the scope of practice of a professional regulatory law.
It adds “pipeline transaction” as the sector including transport of goods/materials through pipelines such as crude, refined petroleum, natural gas, biofuels, and other chemically stable substances. This can matter because later provisions (e.g., review of strategic industries) reference pipeline transportation in relation to national security review.
The Chairperson is the Secretary of the Department of Trade and Industry (DTI), who presides.
The BOI is designated as the secretariat of the IIPCC, implementing its policies and resolutions.
Examples of powers include: (1) establishing a medium-and-long-term Foreign Investment Promotion and Marketing Plan (FIPMP); (2) designing a comprehensive marketing strategy to promote the country as an investment area; (3) supporting inbound/outbound foreign direct and trade missions; (4) encouraging and supporting R&D in priority areas indicated by the FIPMP; (5) monitoring performance against measurable timebound targets, including job generation; (6) submitting annual evaluations/reports to the President and Congress; (7) maintaining an online database/directories of local partners; and (8) supporting LGUs to promote and facilitate foreign investments.
It must be developed for a medium five-year plan and a long-term ten-year plan.
It must be based on the country’s competitive advantages, natural resources, skills and educational development, traditional linkages, and international market potential. It must be consistent with the strategic investment priorities plan under Title XIII of the National Internal Revenue Code, as amended.
Yes. Without prior approval, a non-Philippine national may register with the SEC (or DTI for single proprietorships) and do business or invest up to 100% of capital, unless participation is prohibited or limited to a smaller percentage by existing law or provisions of the Foreign Investments Act.
It must apply for registration with the BOI. The BOI then processes the application for registration in accordance with the evaluation criteria under the Omnibus Investments Code.
The applicant must disclose the fact and provide the names and addresses of the partners in the existing joint venture in the registration application with the SEC.
Foreign investment in export enterprises whose products/services do not fall within Lists A and B of the Foreign Investment Negative List is allowed up to 100% ownership. Export enterprises must register with the BOI and submit required reports to ensure compliance with export requirements, with possible reduction of domestic sales to not more than 40% or cancellation of registration for failure without justifiable reason.
They are reserved to Philippine nationals if they are defense-related (with required clearance) or, under the excerpt, micro and small domestic market enterprises with paid-in equity capital below the equivalent of US$200,000. However, non-Philippine nationals may be allowed if: (1) they involve advanced technology as determined by DOST; or (2) they are endorsed as startup or startup enablers under R.A. No. 11337; or (3) at least 15% of their direct employees are Filipinos and they meet a minimum paid-in capital requirement of US$100,000.
Upon order of the President, the IIPCC in coordination with the National Security Council (NSC) and NEDA shall review foreign investments involving military-related industries, cyber infrastructure, pipeline transportation, or other activities that may threaten territorial integrity and the safety/security/well-being of Filipinos, particularly when: (a) made by a foreign government-controlled entity or state-owned enterprise (except independent pension funds, sovereign wealth funds, and multinational banks); or (b) located in geographically critical areas for national security.
If they commit acts under Section 3 of R.A. No. 3019, aside from the penalties under Section 9(a) of R.A. No. 3019, they are punished by an additional fine of not less than ₱2,000,000 but not more than ₱5,000,000.