Rules on Foreign Investments
A. Inward Investments
1. Only foreign investments registered with the Bangko Sentral ng Pilipinas (BSP) are entitled to full repatriation of capital and remittance of dividends/profits using foreign exchange sourced/purchased from the local banking system.
2. For portfolio investments in PSE-listed securities, BSP registration may be made thru a local custodian bank [an authorized agent bank (AAB) or an offshore banking unit (OBU)].
3. A Bangko Sentral Registration Document (BSRD) is issued for each investment directly registered with the BSP. However, for investments in listed shared registered by custodian banks on behalf of the BSP, only one BSRD is issued per investor.
4. The following supporting documents shall be submitted directly to the BSP thru the International Department together with a letter-request for BSP registration of investments :
a. For cash investments,
1. AAB- Certificate of Inward Remittance (CIR) of foreign exchange and its conversion to pesos thru an AAB 1/
2. investee's sworn certification 2/ of receipt of the investment or stockbroker's purchase invoice or subscription agreement (in the case of PSE-listed securities), or accredited dealer's confirmation (in the case of investments in government securities), or contract/certificate of investment (in the case of investments in money market instruments) or certificate of deposit (in the case of investments in peso bank time deposits).
b. For investments in kind
i. proof of transfer of asset to the Philippines/shipping documents
ii. Bureau of Customs (BOC) Import Entry and Internal Revenue Declaration (IEIRD); and
iii. investee-firm's sworn certification of receipt of the investment;
c. For investments in non-PSE listed corporation/partnerships with no previous inward foreign investment registered with the BSP: SEC-approved Articles of Incorporation/Partnership
d. For direct investments in -
- financial institutions
- clearance from the BSP - Supervision and Examination Sector (BSP-SES);
- capitalized expenditures in oil/natural gas/geothermal exploration:
i. Government-approved service contract; and
ii. Copy of the Department of Energy (DOE) letter-validation of expenditures showing, among others, the distribution of validated expenditures among the partners under service contract;
e. Additional required documents:
For shares of stock of Filipino nominees of foreign investors:
Sworn certification of investee's corporate secretary attesting that the said Filipino nominees appear in investee's corporate books only as nominees of foreign investor and that their said shares are covered by Deeds of Assignment from the foreign investor transferring the shares to each nominee; and that the covering certificates of stock issued to the nominees are annotated that the Filipino nominees are merely nominees of the specific investor.
5. AABs, NBBSEs3/, , and their subsidiary/affiliate forex corporations in the Philippines are authorized to sell without prior approval and to remit the equivalent foreign exchange representing sales/divestment proceeds or dividends/profits or earnings of duly registered investments upon presentation of the following documents:
a. For direct equity investments:
i. original covering BSRD 4/;
ii. proof of sale/dividend declaration;
iii. clearance from BSP-SES (in the case of investments in banks), or Insurance Commission (in the case of investments in insurance companies) or DOE/NPC (in the case of investments in oil/natural gas/geothermal companies);
iv. detailed computation of the amount involved in the prescribed format; and
v. pertinent audited financial statements
b. For investments in PSE-listed securities:
i. original covering BSRD/BSRD Letter-Advice from the registering custodian bank; and
ii. photocopy of broker's sales invoice
c. For investments in peso government securities, money market instruments or 90- day peso time deposits:
i. original covering BSRD;
ii. confirmation of purchase or matured confirmation of sale (in the case of investments in government securities) or matured contracts (in the case of investments in money market instruments) or matured certificate of time deposit (in the case of investments in 90-day peso time deposits); and
iii. dividend notice (in the case of remittance of dividends for investments in PSE-listed securities).
B. Outward Foreign Investments by Residents
1. Only outward investments exceeding US$30 million per investor per year, or per fund per year for qualified investors, that are intended to be funded with foreign exchange purchased from the local banking system, are subject to prior BSP approval and subsequent registration with the BSP. For the definition of qualified investors, please see item 14 of the FAQs on BSP Foreign Exchange Regulations.
2. Applications to purchase foreign exchange from the local banking system for outward investments are required to be accompanied by the following documents:
a. Photocopy of investment proposal/subscription agreement, bond/stock offering circular and such other documents showing the nature and place of the investment;
b. A certification that total annual outward investments have not breached the limits under existingregulations;
c. A written undertaking to inwardly remit the dividends/earnings or divestment proceeds from outward investments within 15 banking days from date of receipt and sell the same for pesos through AABs within three (3) banking days from receipt in the Philippines;
d. Photocopy of BSP approval for outward investments funded with FX purchased from AABs exceeding the prescribed limit under existing regulations;and
e. Photocopy of clearance from the Insurance Commission/Securities and Exchange Commission for investments by insurance companies/pre-need corporations, as may be required under existing rules.
3. Residents’ investments in foreign currency denominated bonds/notes of the Republic of the Philippines (ROP) or other Philippine entities are considered outward investments, for purposes of purchasing foreign exchange for funding said investments.
1/ Authorized Agent Banks (AABs) shall refer to all categories of banks [except Offshore Banking Units (OBUs) duly licensed by the Bangko Sentral ng Pilipinas.
2/ Refer to attached suggested Sworn Certification form
3/ NBBSEs - Non-Bank Bangko Sentral ng Pilipinas-Supervised Entities
4/ Refer to attached Checklist of Documents Required for Replacement of Lost Central Bank Registration Document (CBRD)/ Bangko Sentral Registration Document (BSRD)
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