How To Vet and Qualify A Local Partner?
By: Noel C Ducusin
Perhaps you are not yet ready to set up your local company and would like to test the waters. The usual way to do this is to find a local partner who can market or distribute your products or services or enter into a joint venture with you for co-production for sale domestically or internationally. Alternatively, you might be looking for a supplier or service provider, to take advantage of the highly skilled yet affordable local labor force.
Ordinarily, your first stop would be to ask for referrals from friends or associates who are already doing business in the country. However, more often than not, these referrals are from secondary sources, i.e. referrals from a friend of a friend. This is different where your friend or associate directly knows the referral and has a long-term relationship with the referral such that their reliability and capability can be vouched for. Finally, there is also the situation where you don't know anyone to begin with and have to make do with Internet searches to find suitable candidates.
How then do you proceed? What should you look out for? What information should you ask from potential partners (without offending them too much)? Where do you start?
This article will give you the starting point as well as some initial ideas on where to check on what to look for.
Company Registration and Reports
Most if not all serious and established businesses organize themselves as corporations because of their limited liability for shareholders and their continuity regardless of the changes of ownership every now and then. The fact that corporations also have specific rules of organization and operating procedures helps with the systematic and professional way of conducting business.
Thus, the first place to look would be the corporate regulator for corporations, i.e. the Securities and Exchange Commission to see if the potential partner is duly registered there. You can do this check by clicking on the following link.
Corporations are required to file annual reports with this regulator which includes a general information sheet that lists down the current shareholder composition and officers as well as its current capitalization not to mention information on how long the company has been in existence.
In addition, corporations are also required to file their annual financial statements with the same regulator. A check of these financial statements will show you how good the financial position of these companies are. The Philippines adheres to International financial reporting standards as well as generally accepted accounting practices and so it is easy to make comparisons even from a cross-border perspective.
Of course, these papers will not tell you how competent your potential partners are but we will go into that discussion later in the article.
Secondary Licensing With Government Regulators
Companies in selected industries are required to obtain a secondary license from the specific government regulator for those industries.
For a list of industries that require a secondary license, you may click here.
Specific Government Regulators
Usually, the specific government regulator for an industry has a list of companies that have to cease and desist orders or are blacklisted by the regulator. It will be very useful to take a look at those specific regulators that cover your potential partner.
For example, when it comes to investment products and offerings, the same regulator, i.e. the Securities and Exchange Commission, posts a list of companies that they have issued cease-and-desist orders against. You can click here for an example.
Industry Associations
Most large industries have a trade association where companies both large and small group themselves to represent the industry as a whole before lawmakers and government regulators.
You can check with these industry associations to get more information about your potential partner.
You may click here for an example resource.
Government Accreditations
Some government projects can only be undertaken by accredited companies due to requirements of size and financial capability.
For example, when it comes to large construction contracts for government projects, only large construction companies with Triple-A ratings are allowed to bid and participate.
If your project is a large one, then you can be reasonably sure that these Triple-A-rated companies will be qualified and competent enough to do your project.
By way of example, you can check for government accreditations here.
Nonetheless, all of the above is not a substitute for good contract design to protect yourself in a cross-border transaction. Suggestions on proper contract design will be discussed in a separate blog article.
We will also be producing a separate comprehensive information resource on this particular topic so please stay tuned for that.
About the Author
Atty. Noel C. Ducusin is the Director for M&A at DoingBusinessPH, where he works with offshore investors—primarily from Japan, Europe, the US, and Southeast Asia—seeking to enter the Philippine market through acquisitions, joint ventures, and strategic partnerships. He also advises local companies, family offices, and high-net-worth individuals on originating and executing transactions, including preparing businesses to be investment-ready through reverse due diligence.
His work spans the full M&A cycle: identifying counterparties, managing due diligence, leading negotiations, structuring transactions, arranging financing, and coordinating with trusted vendors such as banks, suppliers, and contractors. For startups and new ventures, he helps design fundraising-ready structures and connects them with investors, making DoingBusinessPH a natural bridge between global capital and local opportunity.
Beyond transactions, Noel and his team provide training and digital resources that demystify Philippine business and regulatory frameworks, giving foreign investors the confidence to navigate the local landscape.
A lawyer by training with a degree in Business Management, Noel is also Senior Partner at N. Ducusin & Partners Law Offices, which specializes in Mergers & Acquisitions, Investments, Cross-Border Regulatory, and Corporate Advisory. Over the years, he has developed deep, practical expertise in corporate finance, company valuation, and financial modeling through hands-on involvement as part of the deal team in live transactions. This combination of legal and financial experience allows him to bridge both perspectives seamlessly, ensuring that deals are not only executed but positioned for long-term success.
He is always looking forward to comparing notes with investors, startups, and vendors to explore where his clients’ mandates align with theirs and to uncover potential opportunities and collaborations that benefit both sides. Please feel free to connect with him to continue the conversation and explore where your goals and his clients’ interests may intersect.
His mission for this blog is to help foreign investors, business owners, and managers by breaking down complex legal concepts and dense technical material into simple, straightforward, and actionable insights for better business decisions. Articles and briefs are written in plain everyday language, without jargon or unnecessary academic writing—the simpler and more practical, the better.
“Everything should be made as simple as possible, but no simpler.” – Albert Einstein