How to Write a Partnership Agreement for Your Business in the Philippines

June 11, 2025

Starting a business with partners in the Philippines is an exciting endeavor, but it requires a clear framework to ensure seamless operations and avoid conflict between partners. A partnership agreement (formally known as the Articles of Partnership) outlines how partners collaborate, share profits, and manage responsibilities. This written agreement is required to register your business with the Securities and Exchange Commission (SEC).

We’ll explain what a partnership agreement is, what it should include, and where to get a sample template for Philippine businesses.

What Is a Partnership Agreement?

A partnership agreement is a legal document that defines the terms, roles, and obligations of partners in a business. In the Philippines, partnerships are governed by the Civil Code and must be registered with the Securities and Exchange Commission (SEC). This agreement clarifies each partner’s contributions, profit-sharing ratios, and decision-making processes, reducing the risk of disputes. It’s essential for formalizing the partnership and ensuring compliance with local laws.

Why a Partnership Agreement Matters

Working in a partnership business is often more difficult than in a sole proprietorship since you need to work with your partners rather than making business decisions on your own. Without a partnership agreement, misunderstandings over responsibilities or profits can derail a business. In the Philippines, where partnerships are recognized as legal entities, a well-drafted agreement protects partners by setting clear expectations.

In fact, if your capital exceeds ₱3,000, the partnership must be registered with the SEC (which requires an Articles of Partnership).

How to Write a Partnership Agreement

Creating a partnership agreement involves a few key steps to ensure it is legally sound and tailored to your business:

Identify Partners and Purpose: List all partners (full names, addresses) and define the business’s purpose (e.g., trading, consultancy).
Consult with a Business Registration Service: Engage a legal professional to ensure compliance with the Civil Code and SEC requirements.
Draft Clearly: Use precise language to outline terms, avoiding ambiguity.
Notarize: Have the agreement notarized, as required in the Philippines for legal validity.

Key Elements a Partnership Agreement Should Include

A comprehensive partnership agreement should cover:

Partner Details: Full names, addresses, and contributions (cash, property, or services).
Profit and Loss Sharing: Specify percentages (e.g., 50-50 or based on capital contribution).
Roles and Responsibilities: Assign tasks, such as who manages finances, operations, or compliance.
Decision-Making Process: Define how decisions are made (e.g., majority vote, unanimous consent).
Dispute Resolution: Include mediation or arbitration clauses to handle conflicts.
Exit or Dissolution Terms: Outline procedures for a partner’s exit, death, or business closure.
Confidentiality and Non-Compete Clauses: Protect business interests if a partner leaves.

Partnership Agreement Sample Template

You no longer have to copy templates online! You’ll be provided a template with your inputted details during your SEC business registration via the eSPARC Portal.

Carefully prepare the following information before applying online:

Articles of Partnership

- Parties: [Partner A Name, Address], [Partner B Name, Address]
- Business Name and Purpose: [Business Name], engaged in [e.g., retail of goods]
- Capital Contributions: [Partner A: PHP amount/type], [Partner B: PHP amount/type]
- Profit and Loss Sharing: [e.g., 50% each or specify percentages]
- Management Duties: [Partner A handles finances, Partner B manages operations]
- Decision-Making: [e.g., Decisions by majority vote]
- Dissolution: [Terms for termination or partner exit]

Remember to follow the instructions. Once you have completed the business registration forms, you can download all the necessary documents, including the Articles of Partnership. You can then have it notarized by a notary public (a licensed lawyer).

We highly recommend consulting with a business registration service. We’ll not only assist you in drafting your Articles of Partnership and other registration requirements but also help ensure all partners understand the process and reach a mutual agreement.

Tips for a Strong Partnership Agreement

Be Specific: Clearly define contributions (e.g., PHP 500,000 cash vs. equipment) to avoid disputes.
Plan for Exit Scenarios: Include terms for partner withdrawal, death, or bankruptcy to protect the business.
Update Regularly: Review the agreement periodically to reflect changes in the business or partnership.
Work with Professionals: Consult a business registration service to ensure the agreement complies with Philippine laws and addresses unique business needs.

Final Thoughts

A partnership agreement is not just a formality. By clearly outlining roles, profits, and exit terms, it ensures all partners are aligned, reducing risks of conflict. Ensure the information you provided is correct and complete to avoid delays and potential registration denial. A business registration service ensures your requirements comply with legal standards and helps all partners understand and agree on the Articles of Partnership.

Are You Registering a Business for the First Time? Here’s Where to Find Assistance.

Registering a business in the Philippines can be a complex and challenging process. With numerous permits and licenses required by the government, it’s easy to miss a document or forget to renew it. Unfortunately, this can lead to costly fines or even force your operations to shut down.

That’s where Triple i Consulting comes in. Our team of experienced lawyers and accountants provides comprehensive support for your business registration, so you don’t have to stress over the paperwork. Our expertise and network enable us to streamline your registration process, ensuring it’s completed swiftly and correctly.

We’ll handle the permits and renewals so you can focus on what matters most—running your business and achieving financial success.