Executive Order No. 113 has been issued by President Ferdinand Marcos Jr., establishing the 13th Regular Foreign Investment Negative List (RFINL) with revised foreign ownership parameters for multiple Philippine economic sectors. The directive, dated April 13, 2026, becomes effective 15 days following its publication in the Official Gazette or general circulation newspapers.
Malacañang Palace's official release indicates modifications to both Negative Lists A and B, aligning with current legislation while supporting the administration's initiative to reduce barriers for foreign participation in selected investment opportunities and business activities.
The Department of Economy, Planning, and Development (DEPDev) recommended the executive order's implementation, emphasizing the necessity to update the preceding 12th RFINL to address contemporary regulatory standards.
Legal Foundation and Authority
Republic Act No. 7042, the "Foreign Investments Act of 1991," as modified by RA Nos. 8179 and 11647, mandates the Foreign Investment Negative List's creation. This statute requires developing a comprehensive list detailing investment sectors accessible to foreign investors or designated for Philippine nationals exclusively.
Constitutional Article XII, Section 10 establishes the State's regulatory authority over foreign investments within national boundaries, following established national objectives and priorities. Under Section 8 of RA No. 7042, the President holds authority to modify the RFINL based on DEPDev recommendations.
Sectors with Total Foreign Ownership Prohibition
List A encompasses areas where constitutional provisions and specific legislation restrict foreign ownership. Ten sectors maintain absolute foreign equity prohibition, including mass media enterprises, excluding recording and internet business operations as specified in Department of Justice Opinion No. 40.
Architectural practice remains exclusively Filipino territory, alongside cooperatives, except for former natural-born Philippine citizens' investments. RA No. 11917, the "Private Security Services Industry Act," governs private security agencies with complete foreign ownership prohibition.
RA No. 7076 governs small-scale mining operations, marine resource exploitation in territorial waters, and cockpit facilities under total foreign ownership restrictions. Manufacturing, repairing, stockpiling, and distributing nuclear, biological, chemical, and radiological weapons remain off-limits to foreign investors, including firecracker and pyrotechnic production and retail operations.
Sectors Permitting Restricted Foreign Investment
Various sectors accommodate limited foreign participation under specific percentage thresholds. Labor Code Article 27 permits private recruitment agencies for domestic or overseas employment up to 25 percent foreign equity. Defense-related construction contracts operate under identical 25 percent limitations.
Constitutional Article XVI, Section 11(2) allows advertising services up to 30 percent foreign ownership. Multiple sectors accommodate up to 40 percent foreign participation, including retail trade businesses with paid-up capital under ₱25 million per RA No. 11595.
Natural resource exploration, development, and utilization typically maintain 40 percent limits, with significant renewable energy exceptions. DOJ Opinion No. 21 and Department of Energy Circular DC2022-11-0034 permit complete foreign participation in solar, wind, hydro, and ocean or tidal energy developments.
Educational and Public Utility Limitations
Constitutional provisions and Commonwealth Act No. 146, amended by RA No. 11659, maintain public utility operations under 40 percent foreign ownership ceilings. Updated public utility definitions encompass electricity distribution and transmission, petroleum pipeline networks, water and wastewater distribution systems, seaports, and public utility vehicles.
Educational institutions operate under 40 percent restrictions, excluding religious group establishments, diplomatic personnel schools, and short-term skills development facilities outside formal education systems as defined in Batas Pambansa Blg. 232.
Rice and corn production, milling, processing, and trading permit 40 percent foreign investment, with specific divestment obligations under Presidential Decree No. 194 and NFA Council Resolution No. 193.
Infrastructure and Procurement Guidelines
Government procurement covering goods, infrastructure developments, and consulting services typically maintains 40 percent foreign participation limits. Infrastructure projects requiring specialized techniques or technologies unavailable locally may accommodate up to 75 percent foreign ownership.
Foreign bidder qualification depends on treaty arrangements, home country reciprocal rights, local supplier unavailability, or competitive requirements outlined in RA No. 12009 implementing rules, the "New Government Procurement Act."
Defense and Security Regulations
List B addresses sectors regulated for security, defense, health, moral, and small enterprise protection purposes. Firearms, explosives, and related materials manufacturing, repair, storage, and distribution require Philippine National Police clearance with 40 percent foreign ownership limits.
RA No. 12024 governs defense materiel development, production, and manufacturing under 40 percent restrictions, along with dangerous drug distribution and manufacturing authorized under RA No. 9165.
Telecommunications Special Provision
Telecommunications operations constitute a distinct category permitting 100 percent foreign equity when investors' home countries offer reciprocal treatment to Philippine nationals. Without reciprocity, RA No. 11659 caps foreign ownership at 50 percent.
Small Business Protection Measures
Micro and small domestic market enterprises with paid-in equity below US$200,000 equivalent maintain 40 percent foreign ownership restrictions. Advanced technology startups with lead agency endorsement or enterprises employing majority Filipino workers with capital under US$100,000 face similar limitations.
The executive order establishes amendment procedures, permitting Negative List A changes to reflect specific law modifications, while limiting Negative List B amendments to once every two years per statutory requirements.