Gentlemen,

We write to you regarding your queries on the incorporation of a corporation which shall
manufacture and sell on retail, wedding dresses including jewelries and accessories here in the
Philippines.

We would like to inform you that your business plan falls under the definition of “Retail Trade”
under Republic Act No. 8762, otherwise known as the “Retail Trade Liberalization Act of 2000.”
Under this law, retail trade shall mean ay act, occupation or calling of habitually selling dirct to
the general public merchandise, commodities or good for consumption, but the restriction of this
law shall not apply to the following:

(a) Sales by manufacturer, processor, laborer, or worker, to the general public the
products manufactured, processed or products by him if his capital dose not exceed
One hundred thousand pesos(100,000.00);

(b) Sales by a farmer or agriculturist selling the products of his farm;

(c) Sales in restaurant operations by a hotel owner or inn-keeper irrespective of the

amount capital: provided, that the restaurant is incidental to the hotel business; and

(d) Sales which are limited only to products manufactured, processed or assembled
by a manufactured, processed or assembled by a manufacturer though a single
outlet, irrespective of capitalization.

Moreover, the goods which you intend to sell here in the Philippines is classified as “high-end or
luxury goods” which refers to goods which are not necessary for life maintenance and whose
demand is generated in large part by the higher income groups. Luxury goods, under the law,
include, but not limited to products such as: jewelry, branded or designer clothing or footwear,
wearing apparel, leisure and sporting goods, electronics and special effects.

Thus, considering that your proposed corporation falls within the purview of retail trade services,
the foreign ownership of such type of corporation is limited under Executive Order No. 184 or the
Tenth Regular Foreign Investment Negative List. Under the said Executive Order, retail trade
enterprises with a paid-up capital of less than US$ 2,500,000 shall be wholly-owned by Filipinos.

However, Section 5 of the Retail Trade Liberalization Act of 2000 allows full foreign
participation for retail trade enterprises: (a) with paid-up capital of US$ 2,500,000 or more
provided that investments for establishing a store is not less than US$ 830,000; or (b)
specializing in high end or luxury products, provided that the paid-up capital per store is not
less than US$ 250,000.

In light of the foregoing, if you intend to establish a corporation, which is not wholly or 100%
owned by Filipinos, here in the Philippines which shall engage in the sale and retail of high-end
luxury products, the foreign equity requirement under the applicable laws should be a minimum
paid-up capital of US$ 250,000 in its equivalent in Philippine Peso.

Lastly, as per our inquiry with the Securities and Exchange Commission, you will have to secure
from the Bureau of Investments a Certificate which you will have to present to the Securities and
Exchange Commission in order for the US$250,000 paid up capital requirement to apply during
the incorporation of your business.

A. Incorporation of a corporation with the Securities and Exchange Commission

Below are the requirements for the Primary Registration of a Domestic Stock Corporation with the
SEC:

1. Cover Sheet for Registration

2. Joint Undertaking to Change Name
3. SEC Form Stock and Transfer Book

The incorporation of new corporations with the Securities and Exchange Commission is being
done online wherein the reservation of the Company Name as well as the inputting of information
necessary for the Articles of Incorporation and By-Laws of the corporation are done through their
new Company Registration System. Once we have supplied all the necessary information, their
system will generate their pro-forma documents which the incorporators of Ikigai Dojo will have
to sign. The new system of registering a new corporation with the SEC will approximately take a
few months because of all the other procedures added in the process of registration.

We hope that we were able to sufficiently answer your queries. If you have any further questions
or clarifications, please do not hesitate to call or email us.