Foreign investors who open a recruitment company in the Philippines follow the industry’s rules and the requirements for business incorporation. A recruitment and employment company will pair the local labour force with the right available positions. At the same time, it can also provide services for intra-company transfers and hiring foreign employees in the Philippines.
Following the key rules for company licensing and the conditions set forth by the overseas employment administration is an essential step for all those who open an employment agency in the Philippines.
Below, our company formation consultants in the Philippines explain the steps for setting up a recruitment agency in this country.
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Requirements to register a staffing agency in the Philippines
In order to open a recruitment company, both foreign and local investors must first register one of the types of structures available with the Business Register in the Philippines. Apart from this, there are special requirements to comply with when starting such business.
The following conditions are imposed by the Philippine Overseas Employment Administration (POEA) to foreign investors who want to open employment agencies and bring foreign workers to this country:
- The company must have at least 75% local ownership;
- A minimum capital of 5 million pesos is required;
- A POEA license must be obtained.
The Filipino recruitment agency can be opened under the form of a sole proprietorship, partnership or corporation. Our company registration agents in the Philippines can help investors set up any of the structures above.
In practice, investors who open a recruitment company in the Philippines choose to incorporate the new business as a corporation, a limited liability company. Those interested in starting a company in the Philippines can reach out to us for information about the main advantages offered by this business form and the investors’ limited liability.
As far as accounting is concerned, recruitment companies observe the IAS/IFRS accounting principles and are required to submit annual financial statements which are audited by an independent and certified public accountant. Our team is able to assist with these requirements, in addition to providing companies with complete bookkeeping solutions. Contact our accountants in Philippines for more information.
The employment agency license in the Philippines
As mentioned above, the employment agency license, shortly known as the POEA license is mandatory in the Philippines. The following documents must be filed with the same authority within the Ministry of Labor and Employment in order be licensed as a recruitment company in the Philippines:
- the trade name certificate in the case of sole traders or the company’s certificate of incorporation;
- the bank statement showing the deposit of the minimum share capital;
- a business plan;
- a description of the employment procedures;
- a list with all the employees of the agency;
- a resume of the company’s manager who must have qualifications and experience in the recruitment field;
- proof of payment of the license fee.
One must know that other requirements could apply when filing for a POEA license. In some cases, conditions are in place according to the chosen business form: proof of certain documents is provided in the case of a sole trader, while others are needed in the case of a corporation or partnership. In summary, however, the main license application steps are the following, listed below by our agents who specialize in company formation in the Philippines:
- Meet the pre-qualification requirements: included here are proof of meeting the minimum financial requirements and the sources of the investment, among others;
- Pay the filing fee: a non-refundable fee of 25,000 pesos is payable upon the submission of the complete application file;
- Interview: the POEA panel designated to assess the application for the license convenes and evaluates the submission;
- Decision: the authority makes the decision to approve or deny the license application for investors who open a recruitment company in the Philippines;
- Meet the post-qualification requirements: the applicant (now license holder) provides information on the office premises, equipment inventory, organizational chart and others.
Other conditions for investors who set up a recruitment company in the Philippines
Meeting the minimum capital conditions and those concerning foreign ownership are all very important when setting up an employment agency. However, because this business sector is regulated by relevant agencies, and subject to special conditions, investors will also observe the following conditions listed by our company registration agents in the Philippines:
- The office in which the recruitment company will activate in has to meet certain space conditions, such as being at least 100 smq;
- The office has clearly defined areas, such as the reception area, the interview room, conference or training room, etc. A layout is provided;
- The office must have minimum equipment for functioning which includes but is not limited to office furniture and electronic equipment;
- The organizational chart is provided for the authorities who issue the recruitment company license in the Philippines.
If you want to start a recruitment company and need assistance, please feel free to contact our Philippines company registration advisors.