This section of the website is not dedicated to telling you how to set up a business in the Philippines that is sustainable and life preserving, ha ha, that would take more business knowledge than I could ever hope to possess, doing business in the Philippines as is anywhere in South East Asia, is nothing like doing business in Western Europe or the U.S.A. I can recount lots of useful anecdotes and advice of people who have gone to the Philippines and Thailand and other far east countries only to find that the headaches and heartaches end up sending them to an early grave, what I will talk about here is just the tip of the Iceberg.

Excluding those foreigners who work for large established companies in the Philippines or those rare ones who are on salary from foreign companies, there are generally three types of foreign businessman in the Philippines.

Type 1: The very small percentage of working (that is legally) expatriate business people who actually do make some money, but not very much money it can be said, but just about enough to get by and be comfortable in the Philippines. These guys won't become big earners, because they have flat heads, this is caused by continually banging their head against brick walls, they have thrown away all their business ideas, and economics books, simply because they have come up against the 'Filipino' factors in their business dealings and decisions and are resolved to playing the Filipino game of doing things.

Type 2: These are the ones who play at it, they don't make much money from their business, and invariably, have another source of income coming in, generally this is a pension, or pensions, paid to them by their host countries or private pension scheme paid to their account in the Philippines, they play the Filipino game and generally do not care too much one way or the other whether they make much money, there in it for the subsistence it gives and if they make any money, fine, if they don't who cares ! they have got their pensions.

Type 3: These are the vast majority of investors who come to the Philippines to start a business, it normally ends up devouring all their investment capital within 6 months, these guys try to run a business they run it back home, or even worse still, they let some local Filipino run it for them, whilst the cat is away the Filipino is at play, they are like a mouse on a treadmill, they keep expending lots of energy, but end up going nowhere, hence they only last as long as the money does, and then walk or (run) away back to home country scratching their forehead and wondering where it all went. They have simply failed to take into account the Filipino factors

So what are these Filipino Factors ? They are normally a group of frustrations that seem to come out of nowhere like ants at the picnic table, they seem to devour everything the can and refuse to go away until you have nothing left, at that point they leave just as quickly as they came and as stealthily as they arrived.

1. Never rush into any business deal no matter how great it looks ! or how good it sounds in principle, and never pay any money up front for anything. Take a lot of toime to gather all the information before investing 1 peso in any business. Make a list of all the possible scams and ways that you could be cheated out of your hard earned money. Once you have finished your list, remind yourself that any Filipino who has proposed a business deal to you, has also thought of all the scams, and them some more, nothing in the Philippines is beyond the realms of possibility.
2. As a foriegner in the Philippines, you can not own more than 49 per cent of a business, the remaining 51 per cent must be owned by a Filipino, effectively meaning you must have a partner, although this can be your Filipino wife, if you are married to one of those beauties, but if you are not, you must engage a Filipino partner, your business or venture, may fail even quicker without one. The Exact partnership arrangement with a FIlipino should always be worked out to the fine detail, you can have all the greatest ideas in the world, but for them to work, a Filipino is required, to put it into practice.
3. Apart from your Filipino partner, the less people who are involved in the management side of your venture the better, try to avoid being talked into having any relatives, friends or others being involved in it, never let a Filipino girlfreind say " My brother/sister/Aunty/Uncle/Friend is a lawyer, or consultant, they will do things for free for you !, any Filipino consultant or lawyer may be good, but if its for free, whose interests do you think they will be looking after, I Can 100 per cent promise you, it will never be yours !
4. Do not expect any help or good wishes from anyone else in the Philippines apart from your Filipino business partner, they don't care whether you succeed or not, and why should they ? if you fail, they will most probably laugh at you, stupid foreigner ! Most foreigners want to start bars, especially on the lower Islands they think starting a bar is paradise, on the face of it, it does seem so, but Filipino landlords are very clever, when a foreigner wants to start a bar, they sometimes renovate and upgrade the premises, if the enterprise goes to the wall, and the foreigner is out of business, he tends to walk away. The Owner of the lease in the premises then has a nice renovated place to sell on to some other mug punter who comes along, he knows and understands there is a sucker born every minute the monthly rental he receives from the premises is nothing compared to the money he makes in selling the lease on to the next Joe or Kano who comes along with bulging pockets.
5. Never part with one peso or sign any document before attaining the services of a professional English speaking lawyer, most lawyers in the Philippines should speak english, the educated do use it more than local languages in business, if they suddenly break into Tagalog or any other dialect, insist that the conversation remains in English until you have left, do not allow Filipinos to break into Tagalog or Cebuano, or any other language when discussing business, they have a habit of doing this, if they do this, you cannot understand what they are saying, and thats not good for you.
6. Never go into business with anyone who suggests you use his or her lawyer to complete the paperwork, it can invariably be a collusion scam, the same goes if you are offered the services of a lawyer at discounted prices, watch out for this approach, it could be a scam.
7. If at any time you think you smell a rat ! then watch out, it might well be, sometimes your own instincts tell you, and there is always someone waiting to pick you clean.
8. Whenever large amounts of money have to be withdrawn, insist that both parties must be present at the bank, on more than one occasion in the past, the person who received the foreigners money is the one who walked off with it, and never to be seen again.
9. Never use 'agents' or 'intermediaries' where money is concerned. As always in many parts of the world, dishonest agents tend to run off and pocket the money, when the real owner finds he has not been paid the money, the agent is never to be found and whether you have a receipt or not, the buyer always ends up paying out the money again.
10. Don't let your emotions get in the way of decision making. Use your head at all times, distance it from your heart. If your ladylove threatens not to stay with you, fine tell her to politely f...off, its easier to wave goodbye to her, than to your money, and besides, she is replaceable, your money is not so replaceable, console yourself with a sobering peice of information, a love of your life is like a pebble on a beach, easily replaceable, your life savings are not.
11. When considering purchasing real estate, such as a Lot, a house, bar, vacant land, always and I repeat always establish professionally, who has title to that property or land, the land might be titled to someone you don't know about, it could have been mortgaged or simply pawned off the old fashion way, make sure there is no lien or covenant on it, it could be owned by a family, or several partners, or a company, or the bank, there are also forged titles to land going around, you could be sold a lot or house or bar or other business premises that is not the sellers by law, thats an easy scam to pepetrate on an unsuspecting foreighner, any peice of paper in this situation is not worth the paper its written on, sometimes the real owners are in on this, and properties can be re-sold and re-sold to unsuspecting buyers.
12. This is the Philippines, never start whining about the system, and when things don't go as you have planned. Don't complain that 'this is not how we do things back home', or 'in my country it would never work like this' you are simply not in 'your country anymore' you simply have to accept the pace in which things are done in the Philippines, if you can't take the snails pace at which everything happens, go home, before your health suffers.
13. When doing business in the Philippines don't go bragging about how good things are ! if you ask a chinese businessman how his business he is doing, he would always say "Business is bad, I am loosing money every day !" he would then say "Im only making enough money to survive and eat rice !" Is that the reason why Hong Kong, Singapore, and Taiwan are so poor ? it must be so hard in those conglomerate chinese style economies ! the fact of the matter is, a chinese never tells anyone how he is doing, if your enterprise is sucessful, don't tell anyone, they won't be happy for you.
14. You need to keep constant control over any business activities where you are putting money in, don't every turn your back on it, even for a moment. Don't put too much cash in any one person's hand, except yours of course, reconcile your fiancial dealings regularly, at the end of every day, things have a habit of going missing, Don't go on too many holidays, and for most of the time, stay sober.
15. Don't listen to anyone who tells you they can help you as they have powerful freinds, or the think they are freinds with the local Police PNP Chief, or a Senator, or Congressman, or other City official, many Filipinos exaggerate thier sphere of influence in order to elevate their importance in the local community. Do not rely on them to get you out of any bureacratic jam, it does not matter who they say they know, or who they are related. If you find yourself in trouble in the Philippines, the only one sure thing that will get you out of trouble or bureaucratic problems with licences, permits and regulatory problems is Money !, Money Number 1 in Philippines.
16. Finally and probably the most important business tip, is this, if your business partner just happens to be your Filipino wife, Girlfreind or lover, Don't get caught having relationships with other Filipina's, Filipino cities are small places, gossip is rife, someone will see you with another woman, and the news spreads faster than an airborne virus, YOU WILL GET CAUGHT ! not only does this end your relationship it will no doubt also end your business, should there likely to be a non amicable parting of the ways, guess who ends up with nothing out of the business ?
17. Always remember that you are dealing with the PHILIPPINES ! Western style business practices are of no use in the Philippines, ethics that you have been used to, are totally irrelevant, legal recourse to dishonest business practices is unheard of, the Philippines is the 11th most Corrupt country in the World.

Well guys, someone just rang the bell, and its time that class was over. There will be other topics in the future, but for now, I hope you have enjoyed some heavy reading, its impossible to cover all contingencies, immigration matters and other legal matters are covered in other areas of my website, so if its Visa information you require, its fairly simple for a tourist visa, the details for this are in the main page.

At the time of writing, the Philippine government is always making loud noises about what they will do to clear up this or clear up that, it happens for a short while, but then everything goes back to the way it was, the only thing you can rely on in the Philippines is that everyone wants a little of the action, that is why Money still no 1.

The Philippines never really changes, it does business the same way it always has done, with a brown envelope under the table, the trick of course is not to take it too seriously, don't love the life there too much, keep your guard up, be prepared for the unexpected, but have the time of your life while you are doing exactly just that.

My love affair with the place began 3 years ago, and will only end when the first hand ful of dirt lands on my box, for as complicated, illogical, incomprehensible, and down right irritating as it can be at times, one thing is certain, life there is never dull.

The phrase money number 1 is the personification of the Philippines, doesn't really matter whether you are wealthy or poor, the fun is there to be had if you want it, and to be shared by all. For visitors who have never been out there before, I can only re-iterate the words of the toilet wall philosopher who wrote "DONT WORRY, IT ONLY SEEMS KINKY THE FIRST TIME"

We hope you have enjoyed this section of the Single Mans Rough Guide to the Philippines - The Foreigner Investor You can link back to the Main Page Now