A Philippine corporation can own land and real property — including in Boracay. For foreign investors who want to go beyond condominium ownership and hold actual land title, the corporate structure is the primary legal mechanism. But it comes with real complexity, genuine costs, and significant risks if done incorrectly.
How the 60/40 Structure Works
Under the Philippine Constitution and the Foreign Investments Act, a corporation that owns land or real property must be at least 60% owned by Filipino nationals. Foreign shareholders can hold a maximum of 40% equity. This means a foreign investor can hold up to 40% of a Philippine corporation that owns Boracay land outright with a clean TCT in the company's name.
What the structure allows
- Corporation owns land outright via TCT
- Foreign shareholder holds up to 40% equity
- Corporation can own unlimited quantity of land
- Voting rights and management can be structured via shareholder agreements
- Corporation can hold multiple properties
What the structure cannot do
- Foreign equity cannot exceed 40%
- Cannot use nominee Filipinos (Anti-Dummy Law violation)
- Corporation itself cannot be majority foreign-owned
- Cannot have only one Filipino shareholder as a formality
- Cannot be used to circumvent restrictions via backroom agreements
The Anti-Dummy Law: What Investors Must Understand
Commonwealth Act No. 108 — Anti-Dummy Law
Using Filipino nominees who have no genuine equity stake, no real investment, and no actual participation in the corporation — purely as a device to circumvent foreign ownership restrictions — is a criminal violation. Penalties include imprisonment, fines, and forfeiture of the property.
A legally valid 60/40 structure requires Filipino shareholders who have genuinely invested capital, have real governance rights, and participate meaningfully in corporate decisions. Shareholder loans or pre-signed undated resignation letters are red flags that regulators look for.
Corporate Structure Setup Costs
| Item | Cost | Notes |
|---|---|---|
| SEC registration (Domestic Corp) | ₱8,000–₱25,000 | Plus attorney fees |
| Authorized capital minimum | ₱100,000–₱500,000 | Must be paid up to 25% |
| BIR registration | ₱500–₱2,000 | Plus documentary stamps |
| Mayor's Permit (LGU) | ₱2,000–₱10,000 | Annual, varies by municipality |
| Corporate legal setup (attorney) | ₱50,000–₱150,000 | Comprehensive shareholder agreements |
| Annual corporate maintenance | ₱30,000–₱80,000/yr | Accounting, annual SEC filings |
| Total setup estimate | ₱120,000–₱350,000 | One-time, plus ongoing annual costs |
When Is the Corporate Structure the Right Choice?
Large investment (₱100M+) where setup costs are proportionate to asset value
Commercial property or boutique resort development requiring land title
Genuine business partnership with Philippine nationals who bring operational expertise
Entry-level condo purchase (₱12M–₱30M) — costs are disproportionate; direct CCT ownership is simpler
Single beachfront villa — the 50+25 year lease structure is often more practical and lower cost
Any situation where the Filipino shareholders are purely nominal — legal risk is severe