Philippine foreign ownership rules updated: What it means for global investors

Dubai: The Philippines has updated its foreign investment framework, maintaining strict ownership limits in various fields while gradually opening others to global investors.

Philippine president Ferdinand Marcos Jr. has signed executive order (EO) 113, approving the 13th regular foreign investment negative list (RFINL). The measure defines where foreign investors can participate in the economy and where they cannot under the foreign investments act of 1991.

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Reform and protection

The updated RFINL has reflected the government’s strategy of attracting foreign capital while safeguarding industries considered vital to national interest.

Restrictions have been divided into two categories. List A covers sectors where limits are mandated by the constitution or existing laws and List B includes industries restricted for reasons such as national security, public health, and protection of local enterprises.

Industries closed to foreign investors

Several sectors have remained fully off-limits to foreign ownership. These include mass media, corporate practice of architecture, cooperatives, private security agencies, small-scale mining, utilisation of marine resources, cockpits, nuclear weapons, anti-personnel mines, firecrackers and pyrotechnic devices.

“Only investment areas and/or activities listed in the attached 13th RFINL shall be reserved to Philippine nationals, subject to the exceptions and conditions indicated therein,” read the order.

Partial access 

Foreign participation has been allowed in some industries, but within strict limits. Ownership has been capped at 25 percent in private recruitment firms and companies involved in the construction of defence-related infrastructure. 

Advertising firms has been granted up to 30 percent foreign equity while a wider group of sectors have been imposed a 40 percent foreign ownership ceiling. 

These include retail trade enterprises with paid up capital of less than ₱25 million, natural resource exploration, private land ownership, public utilities, trading except retailing of rice and corn, government procurement of goods, infrastructure projects, consulting services, commercial fishing, and condominium ownership.

Openings in telecoms 

Moreover, foreign investors can own up to 100 percent of telecommunications companies, provided reciprocity conditions are met, meaning Filipino investors must receive similar access in the investor’s home country. 

“Operation and management of telecommunications in case the country of the foreign national accords reciprocity to Philippine nationals, and up to 50 percent foreign equity in the absence of such reciprocity.”

Sensitive sectors remain protected

Under List B, restrictions have continued for industries considered sensitive, giving up to 40 percent foreign equity. 

These areas encompass the manufacture of firearms, gunpowder, dynamite, blasting supplies, explosives, telescopic sights, sniper scope, and other similar devices.

Additionally, the cap has been placed for dangerous drugs, sauna and steam bathhouses, massage clinics, gambling, micro and small domestic market enterprises with paid in equity capital of less than the equivalent $200,000, and those involved in advanced technology with under $100,000 capital.

What this means for global investors

The Philippines has signalled greater openness in sectors such as telecommunications and renewable energy. On the other hand, longstanding restrictions in areas like land ownership, public utilities, and media have continued to shape the investment landscape.

International investors looking to enter the Philippine market will need to navigate these sector-specific limits carefully, often through joint ventures or local partnerships.

EO 113, uploaded on April 16, has been set to take effect 15 days after its publication in the official gazette or in a newspaper of general circulation.