Investment Environment

Investment Environment in Philippines


The government of Philippines encourages domestic & foreign investments in the country. The current investment policies of Philippines are written in the Omnibus Investments Code of 1987, also called the Executive Order No. 226. Under Book 1 of EO 226, to avail investment incentives, companies can register themselves under the Board of Investments (BOI). The fiscal investment incentives include income taxes exemption, exemption from national internal revenue taxes on importation of supplies & spare parts, and from custom duties. Moreover, there are also non-fiscal incentives like the permission to employ foreign nationals in advisory & supervisory positions and simplification of custom procedures for importation of equipment & exportation of processed products.


However, there are certain restrictions & qualifications for investment incentives. Some of the requirements to qualify for investment incentives in Philippines are:


  • Investing in PIONEER Areas & areas of investments listed in the Investment Priorities Plan (IPP)
  • At least 50% of production is for exports, if Filipino-owned
  • At least 70% of production is for exports, if majority foreign-owned enterprise (more than 40% foreign equity)


Pioneer Areas of Investment Environment


The government of Philippines has set certain standards in order to boost industries. The PIONEER activities can go up to 100% foreign ownership, subject to statutory and/or constitutional limitations. In order to do investment in Philippines, the foreign-owned enterprises should be at least one of the following:


Innovation: Innovative industries producing goods that are not in commercial sale in the Philippines, or industries using new and untried production system or transformation of any raw material.


Social welfare: Services such as agriculture, forestry or mining activities or any other service that can contribute towards the attainment of national goals like food self-sufficiency & other social benefits.


Environment: Industries utilizing non-conventional fuels & sources of energy in their production system.





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