Foreign Investment Negative List, or Negative List, is a list of economic sectors where foreign ownership and participation in the Philippines are regulated. It contains two component lists: List A and List B. List A contains areas of investment where foreign ownership is limited by the mandate of the Philippine Constitution or by specific laws. List B, on the other hand, contains areas of investment where foreign ownership is limited for reasons of security, defense, risk to health and morals, and protection of local small-and-medium enterprises (SMEs).
Except for activities where restrictions on foreign equity are imposed under the Philippine Constitution or statutes, the President of the Philippines may amend the Negative List and such amendments should not be made more than once every two years.
The regular Negative List is updated and issued every two years. The current version being implemented is the 12th version, signed into law by President Rodrigo Duterte under Executive Order (EO) No. 175 in June 2022.
Updates on the 12th Version of the Negative List
The Twelfth Regular Foreign Investment Negative Lists mandates changes to List A and List B of the Foreign Investments Negative List to align with existing laws and policies to ease restrictions on foreign participation regarding investment areas and activities.
Below are the following updates included in the new Twelfth Regular Foreign Investment Negative Lists:
Removal of the manufacture, repair, storage, and/or distribution of products requiring clearance from the Department of National Defense (“DND”)
This aligns with the recent amendments to the Retail Trade Liberalisation Act (“RTLA”), which allows full foreign ownership of retail trade enterprises with a minimum paid-up capital of $446,000 in the manufacturing and services industry.
The 12th Foreign Investment Negative List
List A: Foreign Ownership is Limited By Mandate of the Constitution and Specific Laws
No Foreign Equity
Mass media, except recording and inter
net business
Practice of professions, except in cases specifically allowed by the law following the prescribed conditions therein
Professions where foreigners are not allowed to practice in the Philippines, except if the subject to reciprocity as provided in pertinent laws.
Corporate practice of professions with foreign equity restrictions under pertinent laws.
Retail trade enterprises with paid-up capital of less than ₱25,000,000.00
Cooperatives, except investments of former natural-born citizens of the Philippines
Organization and operation of private detective, watchmen or security guards agencies
Small-scale mining
Utilization of marine resources in archipelagic waters, territorial sea, and exclusive economic zone as well as small-scale utilization of natural resources in rivers, lakes, bays, and lagoons
Ownership, operation, and management of cockpits
Manufacture, repair, stockpiling, and/or distribution of nuclear weapons
Manufacture, repair, stockpiling, and/or distribution of biological, chemical, and radiological weapons and anti-personnel mines
Manufacture of firecrackers and other pyrotechnic devices
Up to 25% Foreign Equity
Private recruitment, whether for local or overseas employment
Contracts for the construction of defense-related structures
Up to 30% Foreign Equity
Advertising
Up to 40% Foreign Equity
Procurement of infrastructure projects in accordance with Section 23.4.2.1(b), (c), and (e) of the Implementing Rules and Regulations (IRR) of RA. 9184
Exploration, development, and utilization of natural resources
Ownership of private lands, except for a natural-born citizen who has lost his Philippine citizenship and has the legal capacity to enter into a contract under Philippine laws.
Operation of public utilities
Educational institutions other than those established by religious groups and mission boards, for foreign diplomatic personnel and their dependents and other foreign temporary residents, or for short-term high-level skills development that do not form part of the formal education system as defined in Section 20 of Batas Pambansa (BP) No. 232 (1982)
Culture, production, milling, processing, trading except retailing, of rice and corn and acquiring, by barter, purchase or otherwise, rice and corn and the by-products thereof, subject to a period of divestment.
Contracts for the supply of materials, goods, and commodities to Government-Owned and Controlled Corporation (GOCC), company, agency or municipal corporation
Operation of deep-sea commercial fishing vessels
Ownership of condominium units
Private radio communications network
List B: Foreign Ownership is Limited for Reason of Security, Defense, Risk to Health and Morals, and Protection of Small and Medium Scale Enterprises
Up to 40% Foreign Equity
Manufacture, repair, storage, and/or distribution of products and/or ingredients requiring Philippine National Police (PNP) clearance:
Firearms (handguns to shotguns), parts of firearms and ammunition therefor, instruments or implements used or intended to be used in the manufacture of firearms;
Gunpowder;
Dynamite;
Blasting supplies;
Ingredients used in making explosives:
Chlorates of potassium and sodium;
Nitrates of ammonium, potassium, sodium barium, copper (11), lead (11), calcium, and cuprite;
Nitric acid;
Nitrocellulose;
Perchlorates of ammonium, potassium, and sodium;
Dinitrocellulose;
Glycerol;
Amorphous phosphorus;
Hydrogen peroxide;
Strontium nitrate powder;
Toluene; and
Telescopic sights, sniper scope, and other similar devices.
However, the manufacture or repair of these items may be authorized by the Chief of the PNP to non-Philippine nationals; provided that a substantial percentage of output, as determined by the said agency, is exported. Provided further that the extent of foreign equity ownership allowed shall be specified in the said authority/clearance (RA No. 7042 as amended by RA No. 8179). 
Manufacture and distribution of dangerous drugs
Sauna and steam bathhouses, massage clinics, and other like activities regulated by law because of risks posed to public health and morals, except wellness centers
All forms of gambling, except those covered by investment agreements with Philippine Amusement and Gaming Corporation (PAGCOR)
Domestic market enterprises with paid-in equity capital of less than the equivalent of US$200,000
Micro and small domestic markets that involves the following:
Advance technology as determined by Department of Science and Technology (DOST)
Endorsed as a start-up or start-up enablers by Department of Trade Industry, or DOST
Employ at least fifty (50) direct employees with paid-in equity capital of less than the equivalent of US$100,000
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