Foreign Corporation vs. Domestic Corporation: Which One is Best for Me?

Expanding into the Philippines is an exciting opportunity for many entrepreneurs and investors. But before you can start operating, one of the first decisions you need to make is whether to register as a foreign corporation or a domestic corporation.

At IgniteHub, we often get this question from both foreign and local clients. To help you decide, here’s a simple breakdown of the two structures and guidance on which might be the best fit for your business.

What is a Domestic Corporation?

A domestic corporation is a company incorporated in the Philippines under Philippine laws. It can be 100% Filipino-owned or a mix of Filipino and foreign ownership.

Key Features:

• Registered with the Securities and Exchange Commission (SEC) as a Philippine entity

• Minimum of 2 incorporators (owners)

• Can be majority-owned or fully-owned by foreigners, depending on the industry

• Subject to Philippine corporate tax and reporting requirements

Best for you if:

• You want a company that’s fully recognized as Philippine-based

• You’re entering an industry restricted by the Foreign Investment Negative List (FINL) and need Filipino partners

• You’re building a long-term presence in the country

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What is a Foreign Corporation?

A foreign corporation is a company that was incorporated outside the Philippines but is licensed to do business in the country.

Key Features:

• Must secure a license to transact business from the SEC

• Usually established as a branch office or representative office

• Ownership remains with the parent company abroad

• Can directly engage in operations (branch) or support activities (rep office)

• Subject to Philippine taxes on income generated locally

Best for you if:

• You want to expand your existing foreign company into the Philippines

• You prefer to keep full control with your overseas parent company

• You need a presence in the Philippines without creating a new corporation

Which One Should You Choose?

The right choice depends on your goals:

• Choose a Domestic Corporation if you want a Philippine-registered entity that can stand on its own, with flexibility for foreign ownership (subject to FINL restrictions).

• Choose a Foreign Corporation if you already have a parent company abroad and simply want to operate or establish a presence in the Philippines.

💡 Tip: Many foreign investors choose a domestic corporation with 100% foreign ownership (if allowed in their industry) because it offers more flexibility in local operations and growth.

Start Right with Ignite Hub

Whether you decide on a domestic or foreign corporation, registration can be complex. At Ignite Hub, we provide end-to-end assistance for both local and foreign clients — from assessing your best structure, preparing documents, and securing SEC approval to ensuring compliance with Philippine laws.

Book a meeting with our team today and let’s find the best setup for your business in the Philippines.

Schedule Your Consultation Now