How to Set Up Your Business Remotely?
By: Noel C Ducusin
It costs money, time, and effort to fly to another country to set up your business.
Wouldn't it be ideal if there was a way that you could direct the company set up remotely so that when you arrive in the Philippines, you hit the ground running already?
Yes, there is. That is what we will discuss in this blog post.
Nowadays, digital communications platforms like zoom or Microsoft teams have made it so much easier to collaborate across borders, especially after the pandemic. Nonetheless, as far as the company setup is concerned, a few technical issues still need to be ironed out.
Signatures on Official Documents
Many government agencies in the country still do not allow digital signatures on official documents.
However, the Philippines is a member of the Apostille Convention whereby duly notarized documents in a member state will be recognized in another member state.
Thus, your chosen local consultant can simply forward the documents for your signature offshore and notarization in your local area after which you can send them back to your consultant for filing with the local regulator.
For more details about the Apostille Convention, you can click here.
Registered Office Address
While you will need to declare a registered office address, there is no need to look for actual office space and go through the tedious motions of negotiating a lease not to mention the amount of legwork required to find suitable space.
Virtual office addresses are now prevalent locally, at least in the main cities and business centers. For a minimal fee, these virtual offices can serve as your registered business addresses and can even handle your mail and calls depending on your chosen service package. Your local consultant should be able to recommend a suitable virtual office for your purposes.
Please just note that ideally, your virtual office should be in the same city and tax district as your eventual larger office that will house your employees and staff so that you will not need to transfer tax registrations from one district to another nor have to get the separate business operating permits from another city.
Required Local Officers
Your company will need to have at least a local secretary and treasurer. Your local consultant can already stand in as your secretary and treasurer in the initial phase. Thus, it is important to clarify in the engagement with your local consultant whether or not they are willing to perform this function or whether or not it is included in their engagement.
International Fund Transfers/Wiring
Aside from the fees that you will need to pay your local consultant, certain government fees and taxes must also be paid. The Philippines uses the SWIFT code system unlike the European IBAN system for international wires.
Most major banks internationally can do both SWIFT and IBAN wires. If your local bank does not use SWIFT codes, you might as well look for a bank near you that can use the same. For an example of how to send money to the Philippines to one of its major banks, you can click here.
Acquiring a Local Company
This type of acquisition is not a full-blown acquisition of an ongoing business.
Instead, your local consultant will initially set up a local company under their names as nominal shareholders, after which you or your offshore entity can simply buy into the majority of unissued shares, after which your local consultant will turn over their nominal shares back to you. At least that is the usual way to do it.
Again, it depends on your local consultant if they are willing to do this for you as most of the consultants, though willing to stand in as corporate officers of secretaries and treasurer, are usually unwilling to stand in as shareholders/owners given the responsibilities involved.
About the Author
Atty. Noel C. Ducusin is an M&A lawyer who has advised boards, business owners, investors, and family offices on strategic transactions and business transformation for nearly three decades. As Director for M&A at DoingBusinessPH and Senior Partner at N. Ducusin & Partners Law Offices, he advises on mergers and acquisitions, strategic partnerships, capital raising, corporate restructuring, and cross-border investments, while helping international companies establish, invest, and grow in the Philippines. Beyond advising on transactions, he also helps create them by connecting investors, business owners, executives, and advisers whose strategic interests align, believing that many successful opportunities begin with a simple conversation. Through this blog, he shares practical, plain-English insights to help foreign investors, business owners, directors, and executives make better strategic decisions.
"Everything should be made as simple as possible, but no simpler." — Albert Einstein
Connect with him on LinkedIn to compare notes on strategic opportunities and future possibilities.