10th Sep 2014
A Representative or liaison office deals directly, with the clients of the foreign parent company but does NOT derive income from the Philippines and is fully subsidized by its foreign head office. It undertakes activities such as but not limited to information dissemination and promotion of the company’s products as well as quality control of products. A representative office does NOT have a legal personality separate from its parent company.
The required minimum annual inward is Thirty Thousand United States Dollars (US$30,000.00). It must be emphasized that the minimum of US$30,000.00 must always be remitted every year to the Representative Office to cover operating expenses.
You will need a Resident Agent for a Representative Office. Furthermore, for a Philippine representative office, the Corporation Code requires that within sixty (60) days after the issuance of the license to transact business in the Philippines, the branch office shall deposit with the Securities and Exchange Commission for the benefit of present and future creditors of the representative office in the Philippines, securities satisfactory to the Securities and Exchange Commission, consisting of bonds or other evidence of indebtedness of the Government of the Philippines, its political subdivisions and instrumentalities, or of government-owned or controlled corporations and entities, shares of stock in “registered enterprises”, shares of stock in domestic corporations registered in the stock exchange, or shares of stock in domestic insurance companies and banks, or any combination of these kinds of securities, with an actual market value of at least One Hundred Thousand Pesos (P100,000.00).
In addition, within six (6) months after each fiscal year of the representative office, the Securities and Exchange Commission shall require the representative office to deposit additional securities equivalent in actual market value to two percent (2%) of the amount by which the representative office’s gross income for that fiscal year exceeds five million (P5,000,000.00) pesos.
Nicolas & De Vega Law Offices is a full service law firm in the Philippines. You may visit us at the 16th Flr., Suite 1607 AIC Burgundy Empire Tower, ADB Ave., Ortigas Center, 1605 Pasig City, Metro Manila, Philippines. You may also call us at +632 4706126, +632 4706130, +632 4016392.
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