President Ferdinand Marcos Jr. has signed an executive order updating the country’s foreign investment rules. This order includes a revised list of sectors and areas that are open to or restricted from foreign ownership.

Under Executive Order No. 113, dated April 13, the government amended the 12th Regular Foreign Investment Negative List (RFINL) to reflect changes in both restricted and partially open investment sectors.

The Department of Economy, Planning, and Development (DepDEV) has stated that the revision of the 12th Regular Foreign Investment Negative List (RFINL) is necessary to align with existing laws.

This update supports policies intended to ease restrictions on foreign participation in specific economic activities and investment areas.

The amendments to Negative Lists A and B reflect these legal changes and remain consistent with the current policy to facilitate increased foreign investment.

“There is a need to amend the 12th RFINL to reflect changes to Negative Lists A and B, pursuant to existing laws and consistent with the policy to ease restrictions on foreign participation in certain investment areas or activities,” the department said.

The order maintains a list of sectors where foreign ownership remains fully prohibited. These sectors include:

• Mass media (excluding recording and internet businesses)

• The corporate practice of architecture

• Cooperatives

• Private security agencies

• Small-scale mining

• The utilization of marine resources within archipelagic waters, territorial seas, and exclusive economic zones

• Cockpit ownership and operations

• The manufacture and distribution of nuclear, biological, chemical, and radiological weapons, anti-personnel mines, and firecrackers

Certain activities allow limited foreign equity. These activities include private recruitment for local and overseas employment, and contracts for constructing defense-related structures, both capped at 25 percent foreign ownership. Advertising permits up to 30 percent foreign equity.

Meanwhile, up to 40 percent foreign ownership is permitted in several industries, including:

• Retail trade enterprises with paid-up capital below P25 million

• Natural resource exploration and development (subject to specific presidential agreements)

• Ownership of private lands

• Public utilities

• Educational institutions

• Rice and corn production and trade

• Government procurement of goods

• Infrastructure projects

• Consulting services

• Commercial fishing operations

• Condominium ownership

The EO allows for up to 100 percent foreign ownership in the operation and management of telecommunications, provided reciprocity conditions are met. Otherwise, foreign equity in this sector remains capped at 50 percent.

The order outlines regulations for other sectors involving national security, defense, health risks, morals, and the protection of micro, small, and medium enterprises.

The order will take effect immediately following its publication.

-Paraluman News