How to Change Line of Business in the Philippines: Step-by-Step Guide and Compliance Tips

October 22, 2025

The ability to adapt to new market conditions, customer needs, or emerging trends is vital for any business in the Philippines. Over time, entrepreneurs may decide to add new products or services, pivot their focus, or shift their business model entirely. When this strategic change requires a formal alteration to your registered business activities, you must follow a legal process to change line of business in the Philippines. Failing to do so risks non-compliance, fines, or complications with tax and regulatory agencies.

Understanding Line of Business: Why and When Should You Change?

Your business’s line of business is the specific set of activities, products, or services described during your original company registration with the DTI (for sole proprietorships) or SEC (for corporations and partnerships). This defines what you can legally offer, affects your tax classification, and determines industry-specific regulatory requirements.

Common reasons to change your business line:

Diversification: Adding a new product segment or service (e.g., a restaurant expanding into catering).
Pivoting: Shifting focus to more profitable or resilient sectors (e.g., moving from retail trade to e-commerce).
Regulatory Needs: Pursuing an opportunity in a regulated industry requiring additional clearances and licenses.
Market Pressure: Responding to consumer trends or competition.
Expansion: Entering new geographic locations or target demographics.

Failing to update official records can lead to non-recognition of revenue, delayed permits, or even invalidation of tax documents.

Legal Basis for Amending Line of Business

Changing your line of business is a formal process under Philippine law. It is not enough to simply update your website or product list; it must be amended with all government agencies where the original activity was registered.

For Sole Proprietorships:

Governed by the Department of Trade and Industry (DTI) Business Name Registration Law and related DTI regulations.

For Corporations and Partnerships:

Governed by the Revised Corporation Code (RA 11232), the SEC’s memorandum circulars, and the company’s by-laws/articles of incorporation.

Other Relevant Agencies:

Bureau of Internal Revenue (BIR) for tax classification and permits.
Local Government Units (LGUs) for Mayor’s Permit/Business Permit, especially if the new line of business will be operated in the same or a different address.
Sector-specific agencies (e.g., FDA, DENR, DOT) for regulated activities.

Step-by-Step Guide: Changing Your Line of Business

The process varies slightly by business structure, but generally involves amending registration details at multiple agencies.

For Sole Proprietorships (DTI-Registered Businesses)

Check Eligibility for Business Name Amendment

1. - Visit the nearest DTI office or access the Business Name Registration System (BNRS) online to confirm if your business qualifies for a “Scope Change” or “Trade Name Amendment.”

File for a New or Amended Business Name

1. - If your new line of business is covered by your current scope but not reflected in your business name, you can file an amendment. Otherwise, you may need to cancel your old registration and apply for a new business name relevant to your activities.

Prepare Required Documentation

1. - Amended business name registration form
  - Valid ID
  - Payment proof for amendment fees

Update Barangay Clearance and Mayor’s Permit

1. - After DTI approval, secure an amended barangay clearance and apply for a renewed or revised Mayor’s/Business Permit reflecting your new line of business.
  - Submit updated documents to your LGU licensing office along with fees.

Inform the Bureau of Internal Revenue (BIR)

- Update your Certificate of Registration (BIR Form 2303) and books of accounts to align with the new business activities.

For Domestic Corporations and Partnerships (SEC-Registered Businesses)

Hold a Board Meeting and Draft a Resolution

1. - Call a board or shareholder meeting approving the amendment to the company’s Articles of Incorporation to reflect the new or additional lines of business.
  - Prepare a Secretary’s Certificate documenting the resolution.

Amend the Articles of Incorporation

1. - Draft an amended Article II (Primary/Secondary Purpose) of your Articles of Incorporation.
  - Ensure precise, comprehensive wording that accommodates your new and future business activities.
  - Comply with SEC format and requirements.

Secure General Information Sheet (GIS) and Notarize Amendments

1. - Attach the board resolution, amended articles, GIS, and treasurer’s affidavit (if capital infusion is required), and have documents notarized.

File Amendment with SEC

1. - Submit the amended Articles of Incorporation, supporting proof of notices to stockholders, paid amendment fees, and other requirements to the SEC via eSPARC or at the physical office.
  - Await the issuance of the certificate of amended articles.

Update Other Licenses and Permits

1. - Present the amended SEC certificate to the LGU (city hall) and update your Mayor’s/Business Permit.
  - Notify other relevant agencies if newly regulated activities are included, such as the FDA for food/drug businesses, the DENR for environmentally impactful operations, or the DILG/DOT for tourism services.

Amend BIR Registration

- Update BIR Certificate of Registration, books of accounts, and invoicing system to reflect new activity codes or tax categories.

Sector-Specific Requirements

If your new line of business falls in a regulated sector (e.g., pharmaceuticals, education, hospitality, finance), you’ll need to:

Obtain additional licenses or special permits from agencies such as the FDA, DOLE, BSP, or the Department of Education.
Pass new safety, environmental, or technical inspections.
Report material changes to franchise agreements, lease contracts, or other regulatory documentation.

Best Practices for a Smooth Line of Business Change

Successfully changing your line of business requires careful planning, clear documentation, and a coordinated approach with multiple government agencies.

Strategic Planning: Consider whether your new activities complement your core business, and evaluate potential compliance challenges early.
Engage Stakeholders: Get buy-in from business partners, shareholders, and key employees.
Update All Records Simultaneously: Coordinate changes with DTI, SEC, LGU, BIR, and sectoral bodies in one go to prevent regulatory mismatches.
Engage Professional Support: Working with consultants like Triple i Consulting ensures accurate filings, legal compliance, and minimized downtime.
Communicate with Customers and Suppliers: Notify your business community and update any marketing, agreements, or vendor records related to your line of business change.

Potential Pitfalls to Avoid

Changing your line of business involves various government agencies and regulatory filings. Overlooking common pitfalls during this process can result in costly delays, compliance issues, or even penalties.

Incomplete Coordination: Changing your line of business at only one agency creates inconsistencies and may invalidate permits or cause tax issues.
Poor Documentation: Missing board resolutions, improperly worded amendments, or a lack of proof of notices can delay SEC approval.
Tax Mismatches: New lines of business may subject you to different tax rates or obligations; double-check your status with the BIR.
Non-Compliance with Sector Regulations: Some industries require strict, pre-market approvals before launch.

Final Insights

The Philippine marketplace demands agility, and the legal process to change line of business is both a challenge and an opportunity for growth. By following the proper procedures, engaging expert support, and proactively managing compliance, entrepreneurs and corporations pave the way for long-term success. Whether you are diversifying, entering a new market, or future-proofing your brand, always prioritize legal clarity and comprehensive government coordination to unlock your next phase of business growth.

Is Assistance Available?

Yes. Triple i Consulting specializes in business registration and compliance, offering a full-service solution for companies looking to change line of business in the Philippines. Services include:

Drafting and review of amendments to Articles of Incorporation/by-laws or DTI business name filings
Preparing board resolutions and ensuring proper shareholder/stakeholder notice
Coordinating with the SEC, DTI, BIR, LGUs, and regulatory agencies
Managing supporting documentation and government follow-up
Advising on tax planning and compliance for new business activities

Ready to pivot or expand your business? Contact our team of experts: