How to Check if a Company is Legit in the Philippines

When considering doing business or making an investment, ensuring the legitimacy of a company is one of the most crucial steps you must take. The Philippines, with its growing economy, attracts entrepreneurs and investors alike. However, it also presents the risk of encountering fraudulent companies. The good news is that there are several ways to verify if a company is legitimate in the Philippines, and we’ll explore them here.

Start with SEC (Securities and Exchange Commission)

The Securities and Exchange Commission (SEC) is a key body responsible for regulating businesses in the Philippines. All legitimate companies must be registered with the SEC, which provides public access to verify the registration of a corporation. You can access the SEC i-View, an online system where you can search for companies using the name, registration number, or the name of an individual associated with the corporation.

Using the SEC Verification System:

• Visit the official SEC website.
• Use their online verification tool (i-View).
• Input the company name or registration number.
• If the company is legitimate, the system will display its registration details. If no results are found, it is a red flag that the company might not be legally operating.

Check with DTI (Department of Trade and Industry)

For sole proprietorships, registration with the Department of Trade and Industry (DTI) is required. The DTI's Business Name Registration System allows you to search for a company to verify its legitimacy. Like the SEC, it’s a government body responsible for maintaining the records of legally operating businesses in the country.

Using the DTI Online Business Registration Tool:

• Visit the DTI website.
• Enter the business name into the search box.
• A legitimate company will appear with valid registration details, such as the owner’s name, registration number, and expiration date of the registration.

Check for a Mayor's Permit or Business Permit

All businesses operating in the Philippines are required to secure a Mayor’s Permit from the city or municipality where they are based. This permit proves that the business complies with local laws and regulations. Asking the company for a copy of its Mayor’s Permit is a legitimate request, and most legal businesses will provide it.

What to look for in a Mayor’s Permit:

• The permit must be renewed yearly.
• It should contain the business’s complete address, permit number, and date of issuance.

Verify with the Bureau of Internal Revenue (BIR)

A legitimate company will also be registered with the Bureau of Internal Revenue (BIR) for tax purposes. The BIR issues a Tax Identification Number (TIN), which is crucial for identifying a business. You can verify if a company is BIR-registered by contacting the nearest BIR office.

Check Business Accreditation (if applicable)

Some businesses, especially those in specialized industries like healthcare, real estate, and education, require additional accreditation from industry-specific regulatory bodies. For instance:

• Real estate companies should be accredited by the Housing and Land Use Regulatory Board (HLURB).
• Educational institutions should have accreditation from DepEd (Department of Education), CHED (Commission on Higher Education), or TESDA (Technical Education and Skills Development Authority).

Research Online Reviews and Feedback

While checking government registrations is essential, it’s equally important to check the company's online reputation. Search for customer reviews, testimonials, and feedback about the company. Fraudulent companies often have complaints from customers who have been scammed or have had bad experiences. Websites like Trustpilot and Google Reviews can provide insights into how the company operates. Pay special attention to:

• Complaints about delivery delays.
• Reports of scamming or deceptive business practices.
• Positive reviews that seem fake or too good to be true.

Check the Physical Address and Contact Information

An easy way to spot a potential scam is by verifying the company’s physical address and contact details. If a company only operates online with no physical office or has ambiguous contact information, it could be a red flag. Legitimate companies are transparent with their contact details. You can:

• Visit the office address if possible.
• Call the provided phone numbers or send an email to ensure the contact information is active.

Look for Professional Certifications

Legitimate businesses often display certifications from relevant professional bodies or industry groups. Certifications, such as ISO (International Organization for Standardization), give an added layer of credibility. Ask the company if it holds any certifications and verify these through the issuing organizations.

Red Flags to Watch Out For

• No SEC or DTI registration: If a company is not registered, it’s a huge red flag.
• No tax registration: Failure to provide a BIR-registered TIN can mean tax evasion or illegal operations.
• Lack of online presence: Legitimate companies often have a strong online footprint, including a website, social media, and reviews.
• Too-good-to-be-true deals: Offers that promise exceptionally high returns with minimal risk are often fraudulent.

Key Points Recap:

1. Verify registration with the SEC or DTI.
2. Check if they have a valid Mayor’s Permit.
3. Ensure they are BIR-registered.
4. Look for industry-specific accreditations.
5. Research their online reputation.
6. Confirm contact details and physical address.
7. Be cautious of too-good-to-be-true offers.

In the Philippines, making sure a company is legitimate requires a bit of effort, but it is a crucial step to avoid scams and ensure you’re working with trustworthy businesses. Taking these simple verification steps can save you from the pitfalls of doing business with fraudulent entities.