Legal Market Profile: The Philippines
The Republic of the Philippines is a sovereign state that is located in the Western Pacific Ocean; and due to its location in the Pacific Rim of Fire, it is prone to earthquakes and typhoons but also contains megadiversity. The country consists of well over 7,000 islands that are categorized into three main divisions: Luzon, Visayas, and Mindanao. Colonized by the Spanish for centuries, the present-day capital city Manila was the Asian hub of the Manila-Acapulco galleon fleet. The Philippines became independent after World War II and now boasts of a population of almost 100 million people.
The Philippines’ economy is an emerging market and is currently the 40th largest economy in the world. It is a newly industrialized economy, and is still making the transition from an agriculturally-based economy to one that is based on manufacturing and services. According to Goldman Sachs estimates, in the next 40 years the Philippines will become the 14th largest economy on the planet, and HSBC predicts the economy will be the largest in Southeast Asia within the same time frame.
As one of the Tiger Cub economies along with Indonesia, Thailand and Malaysia, the main industries are agriculture, electronics assembly, business process outsourcing, garments, footwear, pharmaceuticals, chemicals, wood products, food processing, petroleum refining, and fishing. The Philippines Ease of Doing Business Rank is 138th of 183 countries.
The economy of the Philippines is currently growing at 7.8%, overtaking both China and Indonesia.
The Philippines follows a civil law legal system; the codification of laws was introduced to the Philippines by Spain, and many of the country’s laws are influenced by Spanish Civil Code and the Spanish Penal Code.
There are four levels of the regular courts, which include the Metropolitan Trial Courts, the Municipal Trial Courts in Cities, and the Municipal Circuit Trial Courts at the lower level. The Supreme Court is the court of final appeal.
There are also a variety of special courts; one of these is the Sharia courts for Muslims which deal with personal status issues.
Membership in the Integrated Bar of the Philippines is mandatory for those who wish to practice law. Potential members must meet the academic requirements for membership and pass the Bar examination as well. They must also take the attorney’s oath.
The market in the Philippines is buoyant with GDP growth expected to continue at about 5%. Sectors that will continue to attract strong interest from international firms include the natural resources sector. Infrastructure projects will also provide work for law firms as the country tries to update its roads and transportation networks.
Of growing importance are legal firms with immigration and employment law expertise as the business process outsourcing sector gains steam.
The few foreign firms that operate in the Philippines believe that having an established presence on the ground is important, especially focusing on capital markets and project finance mandates. Interestingly, there are few full-service foreign firms operating in the country, which has allowed the domestic legal sector to flourish.
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