A representative office is the lightest Philippine presence a foreign company can establish. It allows a multinational to maintain a local team — for liaison, market intelligence, or product support — without creating a full commercial operation. The critical constraint: it cannot earn a single peso from Philippine sources.
What It Can Do
A representative office is limited to activities that support the foreign parent, not the Philippine market directly:
- Liaison and coordination between the parent and Philippine customers, distributors, or partners
- Market research and feasibility work
- Product or service promotion on behalf of the head office
- Quality control inspection for goods manufactured locally for export
All contracts and invoices go through the head office. The representative office itself is merely the on-the-ground arm.
Annual Remittance Requirement
The foreign parent must remit at least USD 30,000 per year to fund the representative office’s operating costs. This is not a capital deposit — it is an ongoing expense support that must be renewed annually and evidenced by a bank certificate of inward remittance submitted to the SEC each year.
Failure to meet the annual remittance requirement can result in the SEC revoking the office’s registration.
Registration Requirements
Representative office registration with the SEC requires:
- Authenticated parent company documents (Articles of Incorporation, Board Resolution)
- Financial statements of the parent company
- Appointment of a Philippine resident agent
- Initial proof of the USD 30,000 remittance
After SEC registration, the office must register with the BIR and secure local permits.
When to Choose a Representative Office
The representative office works well for multinationals that:
- Need a Philippine presence to support export sales without selling locally
- Are in a market exploration or pilot phase and not yet ready to commit to a full commercial entity
- Operate in a sector where full commercial registration is complex and the immediate need is purely liaison
If you anticipate generating any local revenue — even one client invoice — you need a branch office or a domestic subsidiary instead. The distinction matters: earning income through a representative office is a compliance violation, not a grey area.
For companies comparing structures, see the entity types comparison. To understand the capital and ownership rules for a full commercial entity, start with minimum paid-in capital 2026.
Book a consultation to confirm the right structure, or see transparent pricing.
Frequently asked questions
Can a representative office earn income in the Philippines?
No. A representative office is strictly prohibited from generating revenue from Philippine sources. It exists solely to support the foreign parent's activities — market research, liaison, and product promotion — with all costs funded by the head office.
How much does the parent company need to remit to support a representative office?
The SEC requires the foreign parent to remit at least USD 30,000 per year to cover the representative office's operating expenses. This is an ongoing annual requirement, not a one-time capital deposit.
Is a representative office subject to Philippine income tax?
Because it earns no income, a representative office has no taxable income. It must still register with the BIR and file returns, but its tax position is typically nil. It may be subject to withholding tax obligations as an employer.