By Marvin B. Ibarra
The issuance of the 13th Regular Foreign Investment Negative List (RFINL) on April 13, 2026 marked the latest step in the Philippines’ ongoing effort to refine its foreign investment regime.
Promulgated through Executive Order (EO) 113, the RFINL updated the country’s framework governing foreign equity participation across various industries. While the changes it introduces are more incremental than transformative, they are best understood in light of the sweeping reforms implemented under the 12th RFINL in 2022.
At its core, the 13th RFINL retains the same structure as its predecessors, dividing restricted activities into List A — covering sectors limited by the Constitution and specific laws — and List B — covering areas restricted for reasons of national security, public health, or protection of local enterprises.
The most significant contribution of the 13th RFINL lies in its refinement and clarification of existing rules, particularly those introduced under the 12th RFINL.
One of the clearest examples is the retail trade sector. While previous RFINL lowered the entry barriers for foreign retailers by reducing minimum capital requirements, the latest RFINL goes further by allowing up to 40-percent foreign equity in retail enterprises with paid-up capital below P25 million. This adjustment expands foreign participation into smaller scale retail operations, signaling a more inclusive approach to investment while still protecting micro and small domestic enterprises.
The 13th RFINL also enhances regulatory clarity in key sectors, particularly telecommunications. The previous RFINL opened telecommunications and other public service sectors to full foreign ownership, following amendments to the Public Service Act. However, the latest RFINL explicitly reiterates that such participation is subject to reciprocity requirements, thereby reducing uncertainty for foreign investors and aligning the rules more closely with international practice.
Beyond these sector-specific changes, the 13th RFINL introduces a number of technical refinements. These include updates to ownership thresholds in certain industries, adjustments to sectoral classifications, and the removal or inclusion of specific activities under List B to reflect current policy priorities.
To fully appreciate these updates, it is important to revisit the transformative impact of the 12th RFINL, which laid the groundwork for the current framework. Issued in 2022 through EO 175, it represented a major shift in the Philippine investment policy. Unlike earlier lists, it was anchored in substantial legislative reforms, particularly amendments to the Public Service Act, Retail Trade Liberalization Act and the Foreign Investments Act.
One of the most consequential changes under the 12th RFINL was the liberalization of public service and infrastructure sectors. Industries such as telecommunications, domestic shipping, railways, and airlines were effectively opened to up to 100-percent foreign ownership, subject to certain safety measures. This marked a significant departure from the more restrictive regime under the 11th RFINL and was intended to attract large-scale foreign investment into critical infrastructure.
The 12th RFINL also introduced major reforms in retail trade, significantly lowering the minimum paid-up capital requirement for foreign-owned retail enterprises. This change made it easier for foreign investors to enter the Philippine market, particularly at the small and medium enterprise level. Complementing this, amendments to the Foreign Investments Act reduced the minimum capital requirement for foreign-owned domestic enterprises under certain conditions, further lowering barriers to entry.
Taken together, the reforms under the previous RFINL signaled a clear policy shift toward greater openness and competitiveness. They expanded foreign participation across a wide range of industries and addressed longstanding concerns about restrictive investment rules.
In contrast, the 13th RFINL represents a consolidation phase. Rather than introducing sweeping new liberalization measures, it focuses on fine-tuning the framework established under its predecessor. Its updates — such as expanded participation in small-scale retail and clearer rules in telecommunications — demonstrate a continued commitment to openness, but within a more calibrated and deliberate approach.
Importantly, both the 12th and 13th RFINLs maintain the core constitutional restrictions that define the outer limits of foreign ownership in the Philippines. These include prohibitions or caps in sectors such as mass media, land ownership and the practice of professions. As such, while the investment environment has become more accessible, it remains bound by constitutional limitations.
In conclusion, the 13th RFINL should not be viewed in isolation but as part of a broader reform trajectory. The previous RFINL initiated a wave of liberalization that significantly expanded foreign investment opportunities, while the new one builds on these gains through targeted refinements and clarifications. For investors, the result is a regulatory environment that is not only more open but also more predictable — an important factor in fostering sustained foreign investment in the Philippines.
Marvin Ibarra is a director with the Tax & Legal practice of Deloitte Philippines.
