Shelf Company: Buy or Start from Scratch?

Just a short note regarding shelf companies, in the Philippines we also refer to them as shell companies. In most cases, if the purpose is to have an entity in the Philippines, it is more cost effective and efficient to just register with the SEC – Securities and Exchange Corporation from scratch.

However, there is a small thriving market in the Philippines for shelf companies for either of two purposes: the first is to project history, and the second to backdoor list on the exchange (the Philippine Stock Exchange or PSE).

There are plenty of reasons why some companies need history, sometimes for regulatory purposes, sometimes for marketing purposes, or to be able to execute a corporate event in a shorter period of time. This is the reason why, shelf companies also become more expensive with age.

For the second purpose, it is still much more cost effective and faster to backdoor than to IPO if one wishes to trade as soon as possible on the PSE. 

If your motivation isn’t one of the two purposes I mentioned above, I recommend you register from scratch.

If you still want to get a shelf company (perhaps to separate the holdings from the operating entities), I can help you navigate this project as well. Just kindly let me know when you’re ready.