28 October 2026 · Securities and Exchange Commission and Department of Trade and Industry

SEC or DTI for a foreign owner

A foreign national is usually shown two doors: a sole proprietorship at the Department of Trade and Industry, or a corporation at the Securities and Exchange Commission. The cheaper door is priced at ₱5,530 for the Certificate of Authority to Engage in Business, and that fee is not the test that decides whether the structure is allowed.

The ₱5,530 Certificate of Authority to Engage in Business is the figure most often quoted to a foreign owner who asks what registration costs. It is a real fee, taken by the Department of Trade and Industry under Republic Act No. 7042. It is also the last question to answer, not the first, because activity and capital decide whether the form can be used at all.

Two numbers come before the fee

Activity first, equity second. If the business sits on the foreign investment negative list, the ownership percentage open to a non-Filipino is capped by law, and a nominee stockholder does not move that cap. Above 40% foreign equity, the capital threshold in the Board of Investments schedule applies. Only once those two checks are done does the choice between DTI and SEC become a question about money.

What the DTI route costs a foreign owner

A business name is priced by territorial scope: ₱200 for barangay, ₱500 for city or municipality, ₱1,000 for regional and ₱2,000 for national, plus ₱30 documentary stamp tax. A foreign applicant adds the CAEB, which the DTI schedule totals at ₱5,530: a ₱5,000 registration fee, a ₱500 filing fee and ₱30 documentary stamp tax.

What that total does not settle is capital. The same BOI schedule puts a foreign-owned sole proprietorship, domestic oriented, at USD 200,000 paid-up. Export oriented, with at least 60% of goods or services for export, the figure is ₱5,000. A foreign owner who picks the sole proprietorship to stay clear of the corporate capital rule is picking a cheaper form, not a lower threshold.

What the SEC route costs

Incorporation is a formula, not a price list. The filing fee is one fifth of one percent of authorised capital, minimum ₱2,000, plus a legal research fee of 1% of the filing fee with a ₱10 minimum, ₱1,010 for the by-laws including its own research fee, and ₱100 for name reservation, valid 30 days. On ₱1,000,000 of authorised capital the total is ₱3,130 before the stock and transfer book.

The two capital figures are different things, and mixing them is a common error. The SEC computes its fee on authorised capital. The BOI threshold is paid-up. A corporation above 40% foreign equity in the domestic market needs USD 200,000 paid up, reduced to USD 100,000 in three cases: advanced technology as determined by DOST, an endorsement as a startup or startup enabler under the Innovative Startup Act, or at least 15 Filipino direct employees. An export enterprise needs ₱5,000, and a branch office carries the USD 200,000 threshold, waived where at least 60% of output is exported.

The order of filings

• Reserve the name, ₱100 at the SEC, valid 30 days. Reserve when the documents are ready, because the clock does not pause.
• Register the vehicle: articles of incorporation, by-laws and the treasurer's affidavit at the SEC, or the business name and CAEB at the DTI.
• Register with the BIR within 30 days of the certificate that creates the business, or 30 days after the first sale. The documentary stamp tax is ₱30.
• Take the Mayor's Permit, which is a local assessment rather than a national schedule, then the fire safety and zoning clearances the city requires.
• File the General Information Sheet within 30 days of the annual stockholders' meeting.

Where the choice is expensive to reverse

Converting a sole proprietorship into a corporation is a new registration, not an amendment. The cheap route is only cheap if the activity and the capital fit it; otherwise the name is registered again from the start.

The representative office is the trap in the other direction: USD 30,000 one-time inward remittance and no income allowed, so invoicing a Philippine client turns it into doing business without a licence. A file that puts a nominee in front of a nationality rule fails for the same reason at the SEC and at the DTI, and it fails after the fees have been paid.

The working order is negative list, equity percentage, paid-up capital, then the vehicle, then the fee. Start with the fee and the structure is rebuilt later, at a cost above either government fee.