PHILIPPINES Law and Practice Contributed by: Raoul Angangco, Sylvette Y. Tankiang, Kristin Charisse C. Siao and Ma. Carla Mapalo, Villaraza & Angangco
1. Legislation and Enforcing Authorities 1.1 Merger Control Legislation
tion. Notably, on 2 March 2022, Republic Act No 11647, further amending Republic Act No 7042, was passed into law, lowering the minimum paid-in capital required for foreign nationals to own micro, small and medium-sized enterprises, subject to certain conditions. The Foreign Investment Negative List identi - fies the industries that are subject to national - ity restrictions and indicates the allowed foreign equity. It compiles the foreign ownership restric - tions found in various laws and regulations and is amended from time to time to reflect changes in the legislation. Notably, on 21 March 2022, the Philippines amended the Public Service Act (Commonwealth Act No 146) to allow full for - eign ownership of entities providing services that qualify as public services. On 8 Decem - ber 2022, Department of Energy Department Circular No 2022-11-0034 (“the DOE Circular”) also took effect and removed certain limita - tions on foreign participation in the exploration, development and utilisation of the Philippines’ renewable energy sector. The DOE Circular now allows 100% foreign investment in solar and wind energy projects. However, certain aspects of the business, such as land ownership, are still subject to foreign ownership restrictions. 1.3 Enforcement Authorities Various government agencies regulate foreign investments in the Philippines. However, the pri - mary agencies concerned with ensuring compli - ance with the rules and regulations on foreign investment in the Philippines are the SEC and the Department of Justice (the DOJ). Republic Act No 11647 introduced the new Inter-Agency Investment Promotion Coordination Committee (the IIPCC), which is intended to integrate all the promotion and facilitation efforts to encourage foreign investments in the Philippines. The IIPCC has representatives from various government
The primary merger control legislation is the Phil - ippine Competition Act (Republic Act No 10667 or PCA), its implementing rules and regulations, and other rules and guidelines issued by the Philippine Competition Commission (PCC). The Revised Corporation Code (Republic Act No 11232), as well as various issuances by the Securities and Exchange Commission (SEC), may also be applicable. Merger control provisions may also be pro - vided for in special laws that apply to specific industries. The Electric Power Industry Reform Act (EPIRA), for example, provides restrictions as to the percentage of the installed generat - ing capacity of a grid and/or national installed generating capacity that an entity, singly or in combination with others, may own, operate or control. 1.2 Legislation Relating to Particular Sectors The Guidelines on the Computation of Merger Notification Thresholds (the “Merger Rules”) pro - vide the rules in determining whether a merger, acquisition of shares or assets, or joint venture has met the merger notification thresholds set by law and are, therefore, subject to compulsory notification. The Foreign Investments Act (Republic Act No 7042), as amended, and its implementing rules and regulations provide the general framework for foreign investments in the Philippines. For - eign equity investments in certain industries may be subject to restrictions as provided in the 1987 Constitution and various pieces of legisla -
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