So You Want To Set Up A Business In The Philippines?

You have to admit, the allure of labor rates fifteen times less than the developed world is going to make you think that making money by producing in the Philippines for export to the high wage countries is going to be easy.  Well, it will be if you are patient enough, tough enough, and have deep enough pockets to run the gauntlet.

Uh, what gauntlet?

First off regardless of the law for export enterprises you are going to have to take a local partner or use some local incorporators including a Filipino corporate secretary.   Yes, you will be a god send to their life and their families’ life as you can afford to pay the mandated minimum wage, about a third more than these same folks will earn working for a local company.  Yes these local companies are also subject to the minimum wage rates but they prefer to bribe the local officials instead of doing things legally so when a worker complains the complaint doesn’t get filed, so you have sales girls working 11 hour days for 160 pesos and grown men earning 250 pesos per day doing hard construction labor.   Contract labor, no benefits, six month’s work and off a month or find another job.

So you pay them a third to twice what they can make locally, full benefits, cover the cost of the ridiculous pre employment requirements, and probably have to cover the cost of their NSO and worse as many of them have no birth certificate at all.  And be careful with those birth certificates as with three siblings in a four sibling family will have three different spelling of the family name.  Papa Dong either was drunk when he filled out the form to report the birth of the child or he simply does not know how to spell his own last name.  Then things are fine as you spend the next year or so spending money, building up a container load of merchandise.

Then you ship the container….and all of a sudden you are getting rich while they do all the work so they quit their job after you refuse to double their pay.  Doesn’t matter that you won’t hit a positive cash flow for months to come or that you immediately begin pumping the lion’s share of the cash into the next container load.  The fact that they were doing better than they had ever done isn’t going to sink into their moronic skulls.  So back to the SEC to re-file the paperwork as partnerships don’t survive legally if one partner pulls out or you re-file the corporate paperwork to reflect the new corporate secretary.

But long before you got to this point you dealt with CPAs that weren’t CPAs actually and fended off numerous attempts to wildly inflate fees for filing or notary service or accounting charges.   Because the second they see white skin the prices will triple and their faces will fall once you tell them you know the local prices for such things and will not be doing business with them anymore.

You managed to open a bank account despite the fact that you need a TIN number for the business yet you can’t get the TIN number because the BIR requires the completed SEC paperwork and you can’t get the SEC paperwork completed because they require a bank deposit to “prove” that you have adequate funding.    And how do you solve this impossible dilemma?    The SEC allows you to put the money in someone else’s bank account so they can query the bank and confirm there is money in the account.  Now what can go wrong with putting money in someone else’s bank account in the Philippines?  Lord knows that fixing the law to repair this impossible process isn’t being considered.

Then you probably need to fire the corporate secretary already for embezzlement so time to file the required SEC 17-C forms with the SEC.  Nope, they won’t accept them, no such forms you are told by the SEC despite the fact that the SEC has the forms available for download on their website.  Instead you are told to update the GIS, the General Information Sheets, but you can’t because you haven’t filed your annual meeting report yet.  Why not?  Because you just formed the corporation a few months ago and it is another ten months till the annual meeting is supposed to be held.  And when are you supposed to actually file the GIS sheets by law?  After the annual meeting of course, in ten months.  The work around is…. to file an affidavit of non meeting.  A notarized sheet of a paper stating that you didn’t hold your annual meeting because (a): it can’t be held under the corporate bylaws until the following year in 2016 and (b): you didn’t need to hold the meeting until the SEC refused to accept the legally required Sec form 17-C informing the SEC of a change in company officers.

At some point you procured a building because for some odd reason you have to have a plant address prior to registering with the SEC but who is going to hold a building for you for two months while the SEC and the PEZA folks drag their feet on setting everything up?   No one, so you rent the shop and it sits empty.

 Then you go to get the electric turned on.   No problem, pay a deposit, the power is still on from the last tenant, all they have to do is finalize a bill and start sending you a bill, right?   Nope, bring original blue prints of the building, an electrical plan, a detailed list of machines along with amperage requirements and placement, a survey by a licensed electrical engineer, company profile, profile for company officers, notarized board resolution appointing the corporate secretary to do business for the corporation (and what else is it that a corporate secretary does?), copies of the lease, site development plans,  a vicinity map of the building.   Ready now, right?  Two weeks later you have all of this gathered up and they can turn the power on, right?   Nope, the previous Dong hasn’t paid the bill in three months so they can’t turn the power off or change the account to your name until he has properly “closed” the account.  One would think that three months of nonpayment would send the message that the business is closed and the electric company would be eager to get a paying client but you have to track down Dong and convince him to sign a notarized statement saying it is okay to change the name of the account owner.

Of course the building failed the electrical inspection in the process.  After pulling the breaker panel cover you see #8 aluminum cables that have run 100 yards to the building, cables that have been there since the building was built fifteen years earlier, but they are feeding a 200 amp panel.   So you downgrade the panel to a sixty amp service or you pay to run cables three times larger.   At this point you are wondering how the Dongs in the past managed to get power turned on.

About now you want to get busy actually setting machinery and training workers but you can’t; there are a total of 28 other departments that you have to deal with before you are done setting things up.    Perhaps ten to twelve requirements per  department,  here is one example for one department: application, copies of your lease, last year’s income tax return (you don’t have one, you just started the company), Mayor’s permit (you don’t have one as you are on a PEZA Zone),  photo copy of a utility bill for that address in your name (you don’t have one, you just moved in), vicinity map, zoning clearance (you are in an industrial park for God’s sake), sworn and notarized notice of undertaking, sworn and notarized notice of allowing inspection and keeping records for the next ten years,  certified and true copy of the latest GIS sheet (the one that isn’t filed until after the annual meeting in 2016), Certified true copy of your PEZA registration(and they are a PEZA department), Certificate of Good Standing from the SEC (which they will refuse to issue and tell you to use the SEC stamped GIS),  profile for the company, profile for all officers, profile for every employee that will deal with said department,  and of course the ubiquitous notarized affidavit of the board resolution allowing the corporate secretary to deal on behalf of the company with the department.  And what are you to do about those items that are impossible for you to provide?   You pay for another notarized letter for each item explaining why you can’t provide the requirement and promise to provide the requirement later.  No, not one letter, five letters, one for each the impossible requirements.

So you finally get in the building, power is turned on, copious volumes of the same information has been deposited at a total of 29 places just at the PEZA complex and your consultant is still dealing with all the tax compliance accounts.  Time to train Dongs and Dongettes.

Detailed instructions for the tasks and procedures is the key you are told.  Older and wiser hands recommend you write up a procedures manual for each task.  But the Dongs might be able to read English and speak English but they comprehend very little of it.    Count on at least an hour to explain a simple task such as building something.  Yes you sent pictures, yes you provided a detailed cut list for the parts, yes you laboriously produced detailed written instructions but no they didn’t follow the majority of the instructions because they didn’t understand them.

So they did it wrong and it needs torn down and redone.   Dong and Dongette are now angry at you because they lost face.    Everyone is threatening to quit if they have to redo the work.  Their brains hurt you are told, sullen and resentful faces are the result of you using words such as parallel, perpendicular, or 2 x 4.   Yes, they successfully built the same item three days before but the fact that this one should be made the same way never enters their mind.

The good news is that once you have them trained they will be content to put nut A on bolt B all day long without getting bored.   They are genuinely challenged by simple tasks and find profound gratitude in a job that an American would grow bored of doing and quit.  In the process they might well remind you of a simian attempting to procreate with prolate spheroid but resist any impulse to show them an easier way or God forbid… the correct way.   Instead adopt the patience of a grandparent dealing with a Downs Syndrome six year old and remember that you are paying about 15 times less than the labor and tax rates you pay in your country and that Dong will show up for work six days a week.

Published in Bureaucracy, Filipino Stupidity


  1. Profile gravatar of Phil Doh
    Phil Doh

    Great article and a must read for anybody thinking of doing business in the land of fails. For the one success story I know of (if you call “ticking over” a success) there are thousands of out-of-pocket failed expat ventures.
    As the first paragraph says when looking at the low salaries, overheads etc it seems like a no-brainer to set up shop. But, of course, this is no ordinary country/economy. The best mistake I NEVER made was starting/buying a business in PH.

    1. Profile gravatar of Idiotocracy
      Idiotocracy Post author

      You are so right, this is not an ordinary country and after dealing with the government this last year I can imagine the wreckage left behind if an ordinary joe plows some money into a local business. If you have actually run a business somewhere it helps but even then you are unprepared for sheer lack of intelligence and institutionalized theft.

      But you know, I didn’t say you can’t make money, I said you damn well better know about the gauntlet of idiots, thieves, and bureaucracy that you are taking on. The key is like the second commenter brought up; invest as little as possible and be ready to walk away at anytime.

      Overhead is not cheap, you will pay twice per square foot for industrial buildings at a PEZA zone than you pay in the U.S. and you will wind up on a PEZA zone unless you are able to keep an honest employee guarding your shop 24/7 . Power is about the same as in the U.S. but the power company will charge you ridiculous “demand” charges if you have anything that pulls more than a air con unit. I pay more for electric at my shop than I pay here in the U.S. for a shop ten times larger that has up to 20 hp motors on some of the machines. Dong paid five times less than you did before he moved out. Internet will cost you about the same as what you pay in the U.S. but will be ten times slower.

      Machinery? Don’t bother looking, what there is is crap or twice the cost of comparable U.S. new machines. Import? Yeah, after you run the gauntlet, if you are on a PEZA zone, or hire a broker who will use someone else’s account and pay more in import fees than you paid for the equipment.

      So yes you can make money but you are going to have to keep your guard up with everyone you deal with, be ready for some major expense setting up, then get as much out as you can as fast as you can and keep the operation as lean and mean as possible so there is little to walk away from.

      1. Profile gravatar of TightWired

        Great article… I’ve thought about opening a business, but with all the b/s I’ve seen or heard about…I’ll pass at this time.
        I’ve talked to a few Managers/Owners of bars/restaurants about owning a business. Covering things like basic monthly costs seems fairly straight forward. Then they tell me about all the Gray or Black areas associated.
        1. Take 10% off for employee theft.
        2. Monthly bribes to the mayor, city hall, fire, PNP etc…
        3. Hiring 25% more staff than you actually need for when people don’t show up.
        4. National, Provincal, City, and Barangay holidays.
        The successful guys don’t make a lot of money on daily business. The real money is made when a genius Foreigner buys the business from them. Then about 6 months latter when the Foreigner runs out of money, they re-buy the business at 50% less than they solid it.

        1. Profile gravatar of Idiotocracy
          Idiotocracy Post author

          Don’t forget 13th month pay and family leave.

          Even I wouldn’t have the balls to try to open a domestic company competing with the Filipinos. Sure way to wind up dead. Then a local would undercut your prices if you sold locally.

          If you stand a chance you have to produce a product and export it to a high wage company. They can’t screw with your sales, can’t take it over like they have done out at Clark and Subic in a few cases.

          Oh, one other huge thing. All those requirements for these permits and licenses gets redone the following year when you have to re apply. Even if you want to continue using the SSS online system, you have to reapply and if you miss the window you have to start all over again.

  2. Profile gravatar of Fr. Bong Bong Jolog Jun III
    Fr. Bong Bong Jolog Jun III

    In another life I was an accountant and financial advisor. I’ve established corporations, limited liability partnerships, trusts and a variety of other business entities in perhaps 20 or more jurisdictions around the world. There is only one jurisdiction where it all just became too hard, and I walked away. That is (or course) the Philippines.

    I think it would be more than fair to say that I have never encountered such completely mindless bureaucracy anywhere, nor have I seen it in such abundance. If awards were granted for establishing confusing, contradictory, chaotic, irrelevant, purposeless “systems” the SEC, BIR and all of the Philippines associated bureaucracy would be in a class all of their own.

    No words I could write here would begin to convey the contemptible stupidity with which the registration of businesses and corporations are handled in this country. Rather than deal with the mindless bullshit, I employ people through a foreign company (using only Pinoy labour). I invest NOTHING locally in land, buildings, capital equipment, etc. I contribute NOTHING locally, but some wages. The government invites only that approach.

    1. Profile gravatar of Phil Doh
      Phil Doh

      I often thought there must be filipinos sitting in offices somewhere researching how first world countries do things and then think to themselves, “hey, I think we can adopt this, but also we can make this more time consuming, more expensive, make no fucking sense whatsoever, and nobody except foreigners will ever complain.”

    2. Profile gravatar of Idiotocracy
      Idiotocracy Post author

      Well I feel better now. Someone with that expertise giving up on the paperwork sure puts things in perspective. What I’ve learned to do is to never go down myself so I am not tempted to curse the brainless idiots. After four or five trips the government dongs are usually content to allow things to proceed as they have pissed on their boundaries, pissed on the Dongs trying to submit the paperwork, and are feeling good about themselves at that point.

      But I’ll tell yah, after dealing with the thieving locals enough I am beginning to understand why there is so much defensive paperwork. Need to get your VIN number checked at the state police station and the chassis numbers checked and rubbed? That is because the chances of some Dong selling you a stolen vehicle is pretty high or the car was never taken out of the previous Dong’s name from five yeas earlier.

      You wouldn’t think that some Dong would sign up for a tax account with the BIR or SSS to scam the government but as stupid as the majority of the Dongs are they have a genius for scamming others. I can see one thinking to set up a SSS account, then trying to file a claim years later for alleged wages paid in on their behalf. Clever enough to find a crack to pry open, not smart enough to realize the consequences of someone of average intelligence figuring out their scam. And yes, one of the dimwitts would have he power turned on in a vacant building so he could sell power to the neighbors until the power company shuts the power off in six months. So some of the mind numbing requirements kind of make sense.

    1. Profile gravatar of Johnny

      Yeah, I read that article on rappler. One of the excuses the guy gave for killing them and stealing it all was that they were not paid well. Again, sociopaths think if they give an excuse, any excuse, it’s OK to do what you want.

  3. Profile gravatar of mactan_foreigner1976

    Investing into that shit place for expat is just burning money. its better go to casino and gamble-definitely higher success chances. I personally lost 7 mln peso here trying to set up business. “partners” just ran away with money and police and court is doing nothing as in their mentality its normal to steal-what does that stupid expat whats from us? get his money back)) whats shall we blame them for-they had a chance -they steal-heroes, we wish we could be in their place)) that’s how they think. good idea would be to shoot a film here using hidden cam how business works, how they take bribes, bullshit, etc and show it on the major channels -maybe that will stop people from bringing money to those bastards here.

  4. Profile gravatar of HawkEye

    If youre onto something good “business wise” there are ways of getting around alot of the nonsense involved in setting up a business here. First negotiate with a reputable law firm to do the leg work and establish the business for you. Pay a monthly retainer to have the law firm be your corsec. The biggest issue is labor and BIR. Constitutionally you cant take a job from someone without due process, its considered their property. So you need to invest in developing a comprehensive company handbook and contracts of employment which outline almost every conceivable infringement as basis for firing them. Call it forewarning and you minimize labor issues. Never forget also to follow due process; buy books or get legal advice to understand the proper legal process for termination of employment without undue hassle and expense. Secondly never pay your way out of a BIR assessment. Keep you books legit and clean. Pay tax lawyers to represent you when it comes to BIR assessments.
    Finally forget “cheap” labor pay them more individually, you’ll need fewer staff (I have only one housemaid on php24k a month, its heavan). Entertain your managers and or staff on a regular basis to share your ideology so they understand your values and how they can earn more.

    Ive set up two companies here that I DO NOT OWN. Both successful thus far. Turnover this year for the current one will be in excess of USD 14 million.

    1. Profile gravatar of BLX2

      “Turnover”? Turnover to who? Please tell me you’re not trying to say you netted $14M profit but are taking the time to post here on the virtues of the Philippines.

      1. Profile gravatar of Idiotocracy
        Idiotocracy Post author

        I think he means gross sales. But his advice is probably spot on.

        On labor issues what I’ve seen is that they will quit at the drop of a hat if they feel they have lost face. So far no problems when they leave but we give the required notices that they are failing to perform and all the workers so far have been family members of a partner or the girl friend’s family. If they feel confused, and trust me it is very easy to confuse one of them, they will get a sullen look on their face as they realize how stupid they are and they are offering to resign right on the spot. Still in the land of scammers it is going to be our turn eventually for a labor claim.

    2. Profile gravatar of Mike

      YOU ARE FULL OF SHIT!!! Here’s why I say that. I too had some businesses here and what happened? The fucking government always made excuses not to give me my profits. I had $36,000 USD sitting in a philippine bank that they refused to release by making up bullshit excuses. Now, if the philippine gov would not release $36K of legal money then why would they release $14M to you? Now the $36 on my side is the low end. I have paperwork to prove from $2M to $7M USD they never released even after taxes paid and they said it was legal.


        1. Profile gravatar of Mike

          PISS OFF WANKER ( that for you Ozzie blokes). Your a minnion trying to sound like a Bill Gates. But I thank you for saying I’m a Legit shit. My parents were married which is more than can be said about you. I mean you come to this site saying how bad this country is while at the same time saying how great it is.

      1. Profile gravatar of Idiotocracy
        Idiotocracy Post author

        I believe you. That is why you export everything, they can’t mess with that. You spend money in the Philippines producing product, sending only enough cash to operate on, then export the product to sell to recover your profit. Just don’t ever put that much at risk. A million peso corp can be set up with about 65K for the initial bank deposit which you can start using a week or so later after the SEC verifies that you had 65K in the bank. Then you dribble the foreign cash out as needed and if you are smart you produce a product that has little market in the Philippines so there isn’t a theft problem and watch the materials and books like a hawk.

        Maximum exposure is when you are ready to ship a container but if you keep it under a million pesos and if you can make twice that in gross profit once the container makes it out of the Philippines and is sold then the risk is worth taking.

    3. Profile gravatar of Johnny

      If either of you are doing legit business with numbers like that, then hire me. I need a job and I’m a dual citizen.
      Either way, I do agree with Hawkeye about the lawyer. Have the lawyer do the legwork and maybe negotiate 5% of the profit to him as a retainer and as a consultant. Make sure he can actually get things done. There are so many bad lawyers here, like really bad.
      That is how the Chinese did it before they were nationalized. They put the business in the names of attorneys, Philippine attorneys. The attorneys got very wealthy in the 60’s and 70’s or until they were legalized. They did very little except act as a buffer between corrupt gov’t and the Chinese employer. So just think of yourselves as the new Chinese, but you actually have the capital to start with as well as a western education.
      Even though I have citizenship and have my own business here, I’m still hiding as much as I can. My partner has a background in law and will eventually become a lawyer one day when he gets the time.
      I have the appropriate paperwork, but I don’t always keep up the permits or licenses. Just due to the nature of my business, they can’t really track us that well. Employees are independent contractors and have to file their own SSS and Phil-Health. Although we do pay for it and actually have someone wait in the never-ending line to pay these things, the employee is still independent of our company. It’s just a way to avoide the DOLE later on. However, there are laws that automatically make a contract employee a full-time employee after some time. Luckily, by that time we have vetted the good ones from the bad.
      Anyway, that is my contribution. Also, I never want to own another business in the Philippines ever again.

  5. Profile gravatar of BLX2

    That would be good if only 13.5m in expenses or less and no significant skin left in the game. Being a smart ass I just hope it wasn’t on $15M in expenses 🙂 I do know a girl who runs a front for her bf that produces websites, he contracts her to produce the sites and she pays the employees. Beats the laws and he doesn’t have much invested at all.

  6. Profile gravatar of HawkEye

    BLX2 is obviously not business savvy. Turnover meaning revenue, specifically net of VAT and discounts. Expected net income, after tax but subject still to dividend tax, USD 2.7 million. As i said, got spmething good “business wise” good money can be made here. Get locals to do the shitty stuff for you. Keep your books clean and honest. Lawyer up to keep labor and BIR issues off your back.

    1. Profile gravatar of BLX2

      Sorry, turnover made me think of employee turnover actually. Dealt with consultants, so no sales tax, no discounts and no clue 🙂 $14M gross, $2.7M net subject to dividend tax I understand. I do have to admit I am lost still, you said you do not own the companies. Do you pay the dividends to someone else and have to trust them to give the money to you?

  7. Profile gravatar of HawkEye

    If you are an Australian citizen but resident of the Philippines (meaning non resident of Australia) you pay tax ONLY on the income you earn in the Philippines with no tax obligation back in Australia. This I believe applies to most if not all commonwealth citizens unlike American citizens who have tax obligations to the US irrespective of their residency status. Another good reason to set up an import based business in the Philippines with tax haven shelf companies set up in other jurisdictions and owned by you supplying goods to the Philippines at transfer prices to limit your local profit. Great scheme to minimize taxes, completely legally too. Sarah can you spell Commonwealth lmfao?!

    1. Profile gravatar of

      No, the US has that too. If you are a resident in a foreign nation, or resided there at least a year, you are exempt from taxes. Besides, you do not have to pay taxes at all if you are earning income in a tax-partner nation. It would be like double payments.

      This same law is why foreigners in America can pay 20 bucks to their foreign government, and claim $1,000 USD a month in Social Security benefits in the USA….

  8. Profile gravatar of Idiotocracy
    Idiotocracy Post author

    If you are exporting and have your transfer price computed properly there is little left to tax in the Philippines. In the PEZA zones you are paying a 5% tax anyway. Things have to be at arms length on pricing but consider that in the U.S. key stoning means wholesaling a $50.00 retail product at $25.00, then with shipping costs, a reasonable wholesale markup, you are already in a range that you can prove that you can get the product from China at a similar rate.

    As for U.S. taxes, all your travel costs are now deductible, keeping a local condo, paying a local “caretaker”, providing material support for setting up the shop or equipment. The only deal is that any equipment needs to be reexported if you shut down, disposed of on the PEZA zone, or complete the import process and pay the duties and VAT. If you get to making too much money selling the product you can invest in your U.S. company to soak up excess or tweak your transfer pricing to leave more in the Philippines and pay the 5% tax. The problem with that is you can’t keep too much in a corporation unless there is a legitimate need for retained earnings.

    Still everything is a gamble over there. Have fun and be ready to walk away from everything and have 200K set aside to close the corporation down if needed.

  9. Profile gravatar of Sarah

    “Entertain your managers and or staff on a regular basis to share your ideology so they understand your values and how they can earn more.”

    I have long suspected that Hawkeye is a deluded expat or native Flip pretending to be an expat. His statement above just confirms my suspicions. And sorry, I don’t play stupid kids spelling games. Is that all you have to offer to challenge my intellect?? You insult me with kid’s games, asshole. Do you have any idea how many prescriptions with scientific names I write everyday? Do you have any idea how many times do I write scientific/medical stuff everyday? Or how often do I have to write “Methycillin resistant staphylococcus aureus” (try writing that without consulting Google! ). Sorry asshole, if I may borrow Bart Simpson’s version of “fuck you”! Eat my shorts!

      1. Profile gravatar of Mike

        So you say your son is a heart surgeon. That does not mean you are that smart asshole. Guess your son got his brains from somewhere else. Riding you sons coat tails to make yourself look and feel better huh?

    1. Profile gravatar of Mike

      It seems to me that Hawk there knows everything bout everything. So Hawk, what do you know about my fields of expertise?

  10. Profile gravatar of HawkEye

    Scientifically im superior to you. Why would you write mrsa on a prescription instead of the antibiotic to treat it. Which fuckwit pretend doctor would write sitagliptin for Type 2 diabetes on a prescription you fake quack

  11. Profile gravatar of Sarah

    Read my post asshole. Are you illiterate also? Where above did I say that I wrote Methycillin resistant staphylococcus aureus on a prescription???? And of course you could not spell the whole shit without consulting google, so you have to abbreviate it! And on whose ass did you pull Sitagliptin from?? Ah, of course! Not only are you a worn out shrivelled up geriatric prune, but a fat diabetic as well!

    So your son is a cardiovascular surgeon….but that’s your son, not you!! Sounds like a Flip, riding on the coat tails of someone’s glory. Tsk, tsk.

    1. Profile gravatar of Mike

      Having read your exchanges with Hawk I can only say one thing. It’s a good thing you have experience dealing with the retarded population.

          1. Profile gravatar of Sarah

            Take your time. Been awake since 03:30 hrs to catch flight, so body’s screaming “get some fuckin’ sleep!” 🙂

          2. Profile gravatar of Mike

            I’m back. But don’t worry . I met BL on they way and we put everything on your credit. We have cold beer and now just waiting for the strippers.

  12. Profile gravatar of VirginiaHustle

    Holy shit holy shit yes! This is spot on and provides great information. My first year doing business here was almost the death of me – there’s a 3 month processing time for this, but an options is to pay the expedite bribe to complete it in 3 days.. Then there’s a bribe for this permit, and then another bribe to get them to actually file it. A random site survey will find you in violation of certain building codes, and then there’s a bribe to get them to pass you – or a recommendation to their friend’s contracting company to make your hallways wide enough.. Forget the fact that he’ll charge you triple when he finds out you’re foreign, but if you hire your own contractor, it won’t pass inspection anyway without having another bribe to pay, and then you start back over. Shoot me now.

  13. Profile gravatar of dpjb2923

    Is a pig farm or some other type of farming an alternative?
    I also here there are set up where you give them say for example 50K pesos for five years, do the farming yourself and at the end of the 5 years you get back your 50K
    If they don’t give back the 50K you keep the land. Hmmm Really? Does that exist?

    1. Profile gravatar of Idiotocracy
      Idiotocracy Post author

      yes, with some important distinctions.

      You loan the money and get possession of the land till you are repaid and all the production is belongs to you until the loan is repaid. But, if you have coconuts they will be stolen as with anything else growing or roaming the land unless you guard it 24/7. When it comes time to pay they simply won’t pay and you will need to spend another 50K hiring an attorney. Then make trips to check on the case for years on end. At that point you are ready to compromise but the fact is that you aren’t getting paid unless you spend a fortune in attorney fees/bribes and then good luck sleeping at night waiting for the landowner or one of his family members to slit your throat.

      Then like the previous poster said, clear title is rare and even if it is clear lots of relatives are going to hit the barangay captain and request money through that system.

      In the long run you would be buying pig feed at retail and selling hogs at wholesale. If you could raise the majority of the pig feed it would work but your pigs would get stolen, the feed would be stolen, and all the while you are competing with a local making 100 pesos a day raising the same pigs.

      Whatever you invest should be so low that you can walk away. Can’t produce anything they can use or sell or you will get stolen blind.

      1. Profile gravatar of Johnny

        One method that I have seen with a farm or some kind of venture like piggery is to hire an auditor. His sole purpose is to go there every 4-6 days and check on everything. If things are in order, he signs off and they sign off. If there are coconut trees, he tells them when to harvest and there is an actual calculation to the whole process like a coconut tree is ready every 40-50 days. With the pigs, he tells them when to sell or send for slaughter.
        In turn the auditor makes 10% before any proceeds are divided among the 2 parties. This works well in theory, but Filipinos are scammers at every turn. So finding a good auditor is key as well as tenant farmers. It lets them know they are constantly being watched. If they claim the pigs died suddenly, but they can’t produce the dead bodies or pictures to the auditor they are done.
        The next key is what leverage do you have over the farmers? If you have none and they know it, they are going to scam you. If they know you are willing to pay some goons (or off-duty pulis) to make their lives miserable, they might be in line a little more. However, that is more money out of your pocket.

        Clear title is the biggest issue. Filipinos have no real concept of property ownership. Plus land can be slated for agrarian reform, but never followed through or they never paid the true owners so the farmers sitting on it claim ownership with no documents to prove it. Yet, they are trying to sell it to the first sucker to come along. Then whoever is next to the on any side no doubt encroached on the land you have or want. Then if you are in a remote area or semi-remote area, the NPA claims it is their land.
        As I type this I can’t help but think Filipinos are just little disciples of Satan. Really, I can’t find a better way to describe their culture and I have zero respect for their culture.

    2. Profile gravatar of Mike

      What you are referring to is what they call a pawn here. Idiot there is correct. Someone pawned a small piece of land to my wife for 20K for two years. Wife built a diner and videoke place on it. Then about a year after this other woman gets a pawn on the house from the same one that pawned to my wife. She felt that since she had money in the house that she also was entitled to half the land the house owner pawned to my wife. Listen to Idiot there, he’s right. Some will come and pawn a 2 bedroom house to you that has renters in it. You are then entitled to collect the rent until they pay back the loan. But if they don’t pay it back you have the rest of the family coming around making a claim on the house and then have squatters in the house.

  14. Profile gravatar of 30-30

    To dpjb2923.
    You can a million dollars farming if you start out with ten million!!!!! Anything a flip tells you or writes down is just a lie. There is a big difference between having a small hobby farm and TRYING to make a living on one. The land titles here so frigged up. Also, you do not know how many inlaws, outlaws,, ex’s,, neighbors,, have an interest in the land.. Dear old granny goes to her reward and the fight is on. That is why you see so many signs saying,, this land under court review..
    Then you make an honest offer,, the seller accepts, but reneges becos a brother in law wants more.
    Do yourself a favor and get drunk,, stoned,, have a good time,,, but never have anything to do with a farm or a flip selling you something.
    Been there and bought the tee shirt

    1. Profile gravatar of Mike

      I’ll make your point stronger. In Surigao City there was a pinoy name Fortich who had title to 40K SQM of land issued to him in 1928 or 1932. After the war the city expanded and squatters moved in on his land, including a full size Petron station. Fortich has been to court many times and always wins yet the case is still going on since 1960!!

      1. Profile gravatar of Johnny

        Meanwhile, everyone is using his land and making money on it except for him. Denying someone else the rights to their property or assets is STEALING. Yet, these “devout Catholics” figure out a way to justify their theft or just babble some excuse why its ok.

  15. Profile gravatar of Harley

    Look its difficult to know who might be a filipino posing as a western person on some of these sites. But one thing that signifies them is they praise something about Philippines, usually long lasting relationships with incredulously honest and faithful filipina women, which is all total bullshit.

    Getting back to the point of this thread, I was fortunate enough to have learned about dishonest and scandalous filipino land deals years before I ever thought of going there. So when I finally did go there I never once entertained the idea of setting up a business there. The place is a joke and the government AND its people are rife with corruption and twisted through and through. Even if a guy did have a good business idea (that might work in the west) you’re still up against employer theft as those people are notorious thieves. If you’re not trying and succeeding in your business idea in the western world what makes you think you can make it work in a foreign country and foreign culture that is stacked (rigged) against you? At least in the west the law is somewhat on your side. In a foreign land you’re totally screwed. And this applies no only to business but to relationships as well. Yeah there’s all the naysayers. But I go back to my saying in other posts, why are you looking for a piece of food in a dumpster? Yes, theoretically you might beat the odds at one hundredth of a percent and find a part of a piece of food there that won’t make you sick… but why risk your life savings on that? But guys do it all the time and loose. They think they can beat the odds, they think their girl is not like all the others, they think their business idea (in the ghetto) will work out. So many people learn the long hard painful way. People make their own choices. I’m staying far away from that place, for good.

    In some ways its sort of like a casino. A rare few self-controlled people can go into a casino, blow a little money, have some fun, and walk away. But many many others get caught up in their injured ego and keep putting more money into it to try and win, even though they keep loosing. See, the house always wins. Its set up that way. It rigged that way. That’s how casinos make their money. You think you can beat the house (Philippines in this case) on their turf, well more power to you and good luck. Or better yet just be smart about it and never go there and cut off all contact with those charlatans.

    1. Profile gravatar of Johnny

      I think you can make almost any business work in the Philippines, but how hard are you willing to work and what are you willing to sacrifice?
      You will invest a lot. You’re thinking, my american dollar goes far so its cheap. Yet, there are a ton of hidden costs. Say you need good internet, well then you’re going to have to buy a static connection or a higher speed plan than everyone else if it is necessary for your business. PLDT has plans for P1500, but I had to get a P4500/ month plan that still wasn’t very fast, but it was as consistent as possible.
      You’re going to have to get a generator is power supply is necessary without interruption. If you have a decent size business, you are going to spend over P50,000, then you have to build something to protect it from the elements and thieving Filipinos so that will cost you another P20,000. Then another P5,000 to have it wired properly.
      These are not very high costs, but it just shows what the extra cost is. They are endless amounts of dumb costs before you as a business owner have the typical costs and headaches a normal guy goes through.
      I did a business in the Philippines and it drove me to the point of insanity and depression. It was not worth it by any means and I just threw the keys at a new manager and said, “its yours”. It still pays me a little and I made my money back plus some, but I would have been much better putting that money into something in the USA or anything that could make 5% a year. I made it work, but wish I never would have done it or I wish I just would have let it fail. It aged me so badly.
      I say do whatever you can to keep US dollars coming in. Put your money there cause you have some protection and the peso is only going to fall further after Christmas time and the elections coming up.