A PHILIPPINE BRANCH is a local operation in the Philippines of the foreign parent company abroad. It is a mere extension of the parent's legal entity abroad and as such, liabilities in the Philippines incurred by the branch accrues to the parent so that in case of financial insufficiency, the parent abroad may be required to make good of the deficiency. Its capitalization shall depend on the nature of operations in the Philippines, whether on a local market requiring at least US$200,000 or on export of at least 60% of its produce, in which case, the US$200,000 may not apply and may capitalize based on an amount it may sustain operations, but may not be less than PhP5,000. Tax implications are almost similar to that of a domestic corporation in the Philippines, and taxes applies only to the operations of the branch in the country.

Before in can do any legitimate operations in the Philippines, it needs to secure a license to do business in the Philippines with the Securities and Exchange Commission (SEC). Upon such license, it will be authorized to conduct business similar to a corporation and with such powers and attributes provided by law. It is likewise required to secure a Mayor's permit with the local government (LGU) of location and register with other government bodies like, Bureau of Internal Revenue (BIR), Social Security System (SSS), Home Development Mutual Fund (HDMF 0r Pag-ibig), and Philippine Health insurance Corporation (PHIC).

If you intend to register one, hereunder are the basic requirements with the SEC:

a. Appointing a Resident Agent , a Filipino citizen residing in the country who shall be authorized to receive summons and communications relative to any legal process with the SEC and other government agencies in the Philippines in behalf of the corporation;

b. Make available the following documents:

• Consularized copy of the board resolution authorizing the establishment of the branch in the Philippines, appointing a resident agent, and authorizing the opening of a treasurer's in trust account for the capitalization;
• Copy of the audited financial statements of the preceding year certified by an independent certified public accountant in the home country; and,
• Consularized copy of the Articles of Incorporation/Registration of the parent company abroad certified by the issuing agency abroad and with English translation if in non-English language.

c. Name reservation with the SEC system. Name is usually the name abroad with the added phrase "Philippine Branch" and shall be reserved with the SEC reservation system upon payment of PhP30.00 per month;

d. SEC Form No. F-103. Resident agent may fill out and sign this document, otherwise, a Resident Agent will have to execute a confirmation of its appointment as Resident Agent; and

e. Certificate of Inward Remittance and the Certificate of Bank Deposit from the depository bank.

For more details and information, you may need an assistance of a consultant such as a lawyer or para-legal who is equipped not only with the procedural aspects, but with the technical know-how of the internal features of the required documents.

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