Establishing a Regional Headquarters (RHQ) in the Philippines is a strategic way for multinational companies to manage, coordinate, and supervise their Asia-Pacific or international operations. The country’s advantageous business climate, skilled workforce, and extensive fiscal incentives make it an attractive choice for setting up either a non-revenue-generating RHQ or a revenue-generating Regional Operating Headquarters (ROHQ). However, registration is a formal, multi-step process requiring careful compliance with regulatory bodies, especially the Securities and Exchange Commission (SEC) and the Board of Investments (BOI).
What Is a Regional Headquarters and Who Needs One?
A Regional Headquarters (RHQ) is an office established by a multinational company to act as a communication and management hub, overseeing subsidiaries, branches, or affiliates across the Asia-Pacific region or beyond. Unlike typical branch offices, RHQs do not engage in commercial or revenue-generating activities in the Philippines; instead, they coordinate, supervise, and provide administrative support for their regional operations.
Companies with existing entities in at least two other countries often set up an RHQ in the Philippines to centralize management with maximum tax and operational efficiency.
RHQ vs. ROHQ: Key Differences
While both RHQ and ROHQ are types of regional offices, their permitted activities and structures differ:
- RHQ: Focuses on supervision, communication, research, and training. Cannot earn or derive income from the Philippines and is funded solely by its parent company.
- ROHQ: Delivers qualifying services (IT, finance, marketing, HR, etc.) to affiliates and can charge fees for such services, making it a revenue-generating entity.
Choosing the right structure depends on whether you plan to charge for services or simply streamline regional management.
The Step-by-Step Registration Process
The process for setting up an RHQ/ROHQ in the Philippines is detailed and requires standardized documentation and approvals.
- Name Reservation and Application Preparation
- Reserve the intended RHQ name with the SEC (eSPARC system).
- Collect documents proving your global operations, such as articles of incorporation and a board resolution authorizing the RHQ set-up.
- Gather Documentary Requirements
Typical requirements include:
- Application form from the SEC’s online system
- Name verification slip
- Parent company’s articles of incorporation (authenticated by the Philippine Embassy/Consulate)
- Certificate from the principal officer confirming board approval for the RHQ establishment
- Certificate from the Philippine Consulate/DTI verifying the parent’s international trade operations
- Latest audited financial statements of the parent company (authenticated abroad)
- Proof of inward remittance: $50,000 USD per year for RHQ (operating expenses); $200,000 USD for ROHQ (startup investment)
- Lease contract or proof of official business address
- Appointment of a resident agent in the Philippines
All foreign documents must be authenticated at the country of origin by the Philippine consulate.
- Obtain BOI Endorsement
Secure an endorsement from the Board of Investments, which assures eligibility for available incentives.
- Register with the SEC
- File the complete document set and BOI endorsement with the Securities and Exchange Commission.
- Await SEC review; approval timelines may range from 6 to 10 weeks, depending on document completeness and processing volume.
- Register with Other Agencies
- Register with the BIR for tax compliance and secure a TIN.
- Register with the Local Government Unit (LGU) for a business permit and Barangay clearance.
- Register with social agencies for SSS, PhilHealth, and Pag-IBIG Fund (for employees).
Setting Up Your Office and Operations
- Secure an official business address, usually with a lease agreement.
- Appoint a local resident agent empowered to receive official communications and legal notices.
- Set up corporate bank accounts, with bank confirmation of inward remittance as proof of funding.
Virtual offices may be used as a temporary address, but a compliant, physical office is required after registration.
Incentives and Tax Treatment for RHQ/ROHQs
For RHQ
- Exempt from local taxes, fees, duties, and charges (except for real property taxes)
- Personnel (expatriates) enjoy preferential tax rates (typically 15% on gross income)
- Tax and duty-free importation of equipment and vehicles (subject to conditions)
- Simplified regulatory requirements since no commercial activity takes place
For ROHQ
- Subject to 10% corporate income tax (lower than the 25% for domestic corporations)
- Exemption from value-added tax (VAT) for qualifying intercompany services
- Reduced withholding tax rates for expatriate employees (15%)
- Exemptions from local government and certain national taxes
Both entities have access to financial, immigration, and operational incentives designed to attract regional management activities to the Philippines.
Registration Timeline
With complete documents and smooth processing, expect the setup process to take approximately 6-10 weeks. Delays may occur if documents are incomplete, improperly authenticated, or if extra clearances are needed from specialized agencies.
Key Compliance Obligations After Registration
- Maintain annual inward remittance of funds to support RHQ operations
- Keep business permits and compliance certificates current
- File annual financial statements and comply with BIR reporting
- Adhere to employment, labor, and immigration regulations for both Filipino and expatriate staff
Common Pitfalls and How to Avoid Them
- Incomplete or Non-Authenticated Documentation: All foreign-issued documents must be consularized, which often causes delays.
- Lack of a Resident Agent: Failing to appoint a resident agent jeopardizes registration and legal compliance.
- Unclear Delineation between RHQ and ROHQ Activities: Engaging in non-permitted activities can result in penalties or downgrading of incentives.
- Insufficient Annual Funding: Underfunding may lead to operational or compliance setbacks.
- Overlooking BOI Endorsement: Missed opportunities for fiscal and administrative incentives can hinder business growth.
Engaging with experienced consultants or legal advisors ensures every facet of application and post-registration compliance is handled correctly and on time.
Why Choose the Philippines for Your Regional Headquarters?
- Strategic location at the heart of Asia with easy access to central ASEAN and global markets
- Cost-efficient and reliable talent pool of English-speaking professionals
- World-class infrastructure and established business districts
- Attractive incentives and streamlined governmental support
- Political stability and a robust legal framework for multinational operations
Final Thoughts
Registering a regional headquarters in the Philippines provides multinationals with a compliant, incentive-rich, and operationally strategic base for managing their Asia-Pacific networks. By understanding the documentary, regulatory, and practical steps, alongside leveraging local expertise, companies can set up their RHQ or ROHQ smoothly and position themselves for regional growth and success.
Is Assistance Available?
Yes. Consult our team of experts at Triple i Consulting or a qualified local specialist for support with document preparation, government coordination, or full end-to-end business registration assistance:
- Contact Us Here
- Fill out the form below
- Call us at: +63 (02) 8540-9623
- Send an email to: info@tripleiconsulting.com