Foreign Investments Act of 1991 overview

"Philippine National": Citizens, domestic partnerships/associations wholly Filipino-owned, or corporations with at least 60% Filipino ownership and control.
"Investment": Equity participation in enterprises organized or existing under Philippine laws.
"Foreign Investment": Equity investment by non-Filipino nationals, in foreign exchange or other assets, registered with the Central Bank.
"Doing Business": Broadly defined to include various activities constituting commercial dealings but excludes mere shareholding or appointing local representatives who transact business independently.
"Export Enterprise": Enterprises exporting 60% or more of output or purchases.
"Domestic Market Enterprise": Enterprises not fulfilling the 60% export threshold.
"Foreign Investment Negative List": List of economic activities limiting foreign ownership to 40% or less.

The Act excludes banking and other financial institutions regulated by the General Banking Act and Central Bank.

Non-Philippine nationals may register enterprises with the SEC or DTI-BTRCP to do business or invest up to 100% capital unless law or the Negative List limits participation.
Registration does not require prior approval unless incentives under the Omnibus Investment Code are sought, which requires BOI registration.
Disclosure is mandatory for competing businesses with existing joint ventures.
SEC must process registration within 15 days.

Allowed 100% ownership except in sectors on the Negative List.
Export enterprises must register with BOI and report compliance with export requirements.
Non-compliance can result in orders to limit domestic sales and subsequent penalties or cancellation of registration.

Foreign ownership up to 100% unless restricted by law or Negative List.
Domestic enterprises consistently exporting 60% over three years may reclassify as export enterprises.

Comprises List A (restricted by constitution/law), List B (regulated sectors like defense-related industries, drugs, gambling, small domestic enterprises under $500,000 capital unless advanced tech, and certain export enterprises), and List C (areas adequately served by existing enterprises).
Lists B and C may be amended subject to recommendations and Presidential proclamations.
Negative Lists are prospective and do not affect existing investments.
Amendments to Lists B and C limited to once every two years.

NEDA evaluates petitions based on control by Filipinos, ample capacity, competition, compliance with health/safety and environmental standards, reasonable prices, and absence of import restrictions.
Public hearings are conducted for affected parties.
Industries included in List C remain for two years before re-evaluation.

NEDA to publish a list of strategic industries within 18 months outlining desired Filipino and/or government equity participation.
Strategic industries are defined by importance to industrialization, capital intensity, technology needs, linkages, and foreign exchange contribution.

All enterprises must comply with existing environmental protection laws and standards.

No government agency may take actions conflicting with this Act or its certificates/authorities.

NEDA, with BOI, SEC, and other agencies, will issue implementing rules within 120 days of effectivity.
Rules must be furnished to Congress.

Violators subject to fines up to P100,000 for individuals, up to P5,000,000 or 0.5% of paid-in capital for juridical entities.
Responsible officials may be fined up to P200,000.
Forfeiture of benefits granted under the Act is mandatory.
SEC empowered to impose administrative sanctions.

Executive Order 226 regulations remain until implementing rules issued.
A transitory Negative List operates for 36 months with defined Lists A, B, and C.
List C areas reserved to Filipinos during the transitory period.
NEDA tasked to enumerate and publish the transitory Negative List.

Certain EO 226 provisions repealed; other inconsistent laws modified or repealed.

The Act takes effect 15 days after approval and publication in two newspapers of general circulation.