Indonesia, the Philippines, and Vietnam are amongst the top-ranked overseas investment destinations in Southeast Asia.
Vietnam’s tactical location — right next to China— and plenty of seaports have fostered large multinational companies in the dragon nation to move to Vietnam.
The Philippines is a developed market; successfully holding onto the GDP rate of over 5% for the last half a decade. Philippine PESO is listed among the best performing Asian currencies.
Although not the fastest expanding economy, Indonesia is idyllic for manufacturing and consumer products.
In this article, we’ll be highlighting key differences between these three countries to invest in Asia, so read on to find out:-
Indonesia vs Vietnam vs the Philippines: Complete Registration
|Business Structures||● Representative Office
● Foreign Company (PT PMA)
● Local Company (PT)
|● Incorporated partnership.
● Representative office
● Limited liability company.
● Joint stock company.
|● Sole Proprietorship
● Stock Corporation
● Non-Stock Corporation
|Time Required||4 to 6 weeks||Around one to three months||Approx 8 weeks|
|Foreign Ownership||There are no restrictions||No restrictions||100% of any local business enterprise|
|Shareholder||Min. 1||Min. 1||Min. 1|
|Capital Contribution||SGD 1||No set minimum capital requirement.||Minimum paid-up capital must not be less than Php 5,000.00.|
- Firstly, in Indonesia, the corporate tax rate is between 1% and 25%; it depends on the industry and profitability level. Indonesia has inked tax treaties with over 64 nations worldwide, and foreign investors greatly benefit from it. 10% is the value-added tax (VAT) in Indonesia.
- Next up is the Philippines, there is a minimum corporate income tax (MCIT), which is 2% calculated on domestic & resident foreign firms’ gross income. However, the companies have to pay corporate taxes only after the 4th month of incorporation.
- There is a Corporate Income Tax (CIT) in Vietnam, 23% for foreign-invested and domestic enterprises.
- In Indonesia, a foreign investor can have 100% of a joint-venture limited liability company or foreign limited liability company, but there is one requirement, which is 5% local shares. Besides, in several sectors where foreign investment is forbidden; there is a dedicated Negative Investment List.
- The Philippines has limited the foreign investment to 40% in military hardware, manufacturing of explosives, and firearms. Other industries with varying foreign investment are as follows:-
- Private radio communication networks- 40%
- Advertising agencies- 30%
- Educational institutions- 30%
- Operation of commercial deep-sea fishing vessels- 40%
- In most industries, Vietnam allows entrepreneurs and investors to own 100% shares.
Company Incorporation Procedure
The company incorporation process in Indonesia can take up to one and a half months. The process is complicated and tedious for foreign intending to launch your company in Indonesia.
Company formation in Vietnam is made easy with the help of professionals who know about the country inside and out. However, specific guidelines are based on the entity chosen for foreign entrepreneurs. The company registration process is straightforward and takes between one to three months to obtain government approval. There are no minimum capital requirements in Vietnam.
The government has eased up the process of setting up a company in the Philippines by establishing a one-stop-shop at the municipal level and improving the communication between the Securities and Exchange Commission and the Social Security System.
Company Registration in Indonesia, Philippines & Vietnam
Each country has its own set of complications and obligations for setting up a company. Thus, it is highly recommended to hire a reliable organization to register a company for help, right from preparing the documents for filling to guiding you on taxes.