PRESIDENTIAL aspirant and Senator Panfilo M. Lacson, Sr. on Tuesday assured micro and small enterprises that there are provisions in the new law that relaxes restrictions on foreign investments to protect their sector.
“We opened up to foreigners the opportunity to invest here but it has safeguards. As long as the starting capital is $200,000 (or about P10 million) and below, that is protected, no foreign investors can get involved. This covers the micro and small (enterprises),” he said in Filipino in a statement on Tuesday.
Micro enterprises have an asset size of up to P3 million with less than 10 workers while small enterprises have up to P15 million in assets with up to 99 employees, as defined by the Philippine government.
Micro, small and medium enterprises (MSMEs) collectively accounted for 99.5% of all businesses in the country, based on the Philippine Statistics Authority’s 2020 List of Establishments.
Of the total 952,969 MSMEs, micro enterprises accounted for 88.77% or 850,127 while small enterprises were 10.25% or 98,126.
Mr. Lacson said that the recently-signed Republic Act 11647, which amended the three-decade-old Foreign Investments Act, will open more credit windows and capital sources for micro and small entrepreneurs.
Under the law, foreign investors can venture into a local enterprise at up to 100% of its capital.
They may fully own small- and medium-sized enterprises with a minimum paid-up capital of less than $100,000 or P5 million if majority of their direct employees are Filipinos.
The law trims down the list of investment areas reserved for Filipinos to just defense-related businesses and small and micro domestic market enterprises with paid-up capital of less than $200,000, or about P10 million.
Mr. Lacson said the new law makes the country more investment-friendly, which could lead to the opening of more businesses and jobs. — Alyssa Nicole O. Tan