Until 2019, foreign investment in renewable energy generation was subject to a 40% foreign shareholding limitation as per the Section 19 of the Rules and Regulations Implementing Republic Act No. 9513, otherwise known as the Renewable Energy Act of 2008 ("RE Act IRR").
Since October 2019, pursuant to DOE Circular No. DC2019-10-0013, issued on October 1, 2019, 100% foreign ownership in biomass and waste-to-energy projects has been allowed. The circular has also clarified that 100% foreign ownership is allowed in large-scale geothermal exploration, development, and utilization projects, provided certain conditions are met: (1) the investment must be large-scale, with a minimum cost of approximately US$50 million, and (2) it must be implemented under a Financial and Technical Assistance Agreement (FTAA) as stipulated by the Constitution.
On November 15, 2022, the Department of Energy (DOE) in the Philippines introduced Circular No. 2022-11-0034, which brought significant amendments to the 2008 Renewable Energy Act. Effective as of 8 December 2022, the Circular removed Filipino ownership requirements previously imposed on the exploration, development and utilization (EDU) of solar, wind, hydro and ocean or tidal energy resources, allowing thereafter full foreign ownership in renewable energy projects. The prior imposition of the Filipino ownership requirement in the EDU of solar, wind, hydropower and ocean or tidal energy was based on the interpretation that such activities constituted the EDU of natural resources. Under Section 2, Article XII of the Constitution, the EDU of natural resources can only be undertaken by Filipino citizens or juridical entities that are at least 60% Filipino-owned. The DOE Department Circular was issued after the Department of Justice (DOJ) released Opinion No. 21, Series of 2022 ("DOJ Opinion") stating that the Filipino ownership requirements under Section 2, Article XII of the 1987 Philippine Constitution relating to the EDU of natural resources should not apply to the EDU of solar, wind, hydro and ocean or tidal energy resources (See Baker & Mckenzie, 2022 for more details)
"Section 1. Deletion of the text of Section 19 (A) of the RE Act IRR. The text of Section 19 (A) of DC No. DC2009-05-0008 is hereby deleted and replaced with [deleted]
Section 2. Amendment to Section 19 (B) of the RE Act IRR. Section 19 (B) of DC No. DC2009-05-0008 is hereby to read as it follows:
B. Parties to a Service/Operating Contract
The State may directly undertake the exploration, development, production and utilization of RE resources, or it may enter into RE Service or Operating Contracts with Filipino and/or foreign-owned corporations or associations [...]" (Department Circular No. DC2022-11-0034, PRESCRIBING AMENDMENTS TO SECTION 19 OF DEPARTMENT CIRCULAR NO. DC2009-05-0008, Department of Energy, 15 November 2022)
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"Section 3. Definition of Terms. As used in this Circular and in other issuance of the DOE, the following terms shall be understood to mean, as follows: [...]
3.22. "RE Developer" shall refer to an individual or juridical entity created, registered and/or authorized to operate in the Philippines in accordance with existing Philippine laws, and engaged in the exploration, development and/or utilization of RE Resources, and actual operation of RE Project. It shall include existing entities engaged in the exploration, development and/or utilization of RE Resources, or the generation of electricity from RE Resources, or both. [...]
3.28. "RE Service Contract" shall refer to a service agreement between the Philippine Government, through the President or the DOE Secretary, and RE Developer, covering an appropriate period as stated therein, in which the RE Developer shall have the exclusive right to explore, develop and utilize geothermal, hydropower, wind, ocean and other RE Resources within a particular area.
[...]
Section 4. RE Contract — Modes of Award and Qualifications. [...]
4.2. Who May Apply. — Any Person, local or foreign, may apply for RE Contracts, subject to the limits provided in this Circular.
4.2.1. The RE Applicant must be a Filipino or, if a corporation, must be a Filipino corporation duly registered with the Securities and Exchange Commission (SEC), with at least sixty percent (60%) of its capitalization duly owned and controlled by Filipinos, unless the application is for biomass development and/or uses waste-to-energy technology, in which case, the 60% Filipino capitalization requirement shall not apply. This provision shall retroact to all RE Applications for biomass resource development and utilization that are being evaluated prior to the effectivity of this Circular.
4.2.2. For the large-scale exploration, development and utilization of geothermal resources, defined under Section 4(s) of the RE Act as a mineral resource, the Government through the President may enter into agreements with foreign-owned corporations involving technical or financial assistance pursuant to Article XII, Section 2 of the Philippine Constitution.
4.2.3. In case the RE Applicant is a joint venture or a consortium, the partners of the joint venture or members of the consortium shall organize themselves as a corporation registered under the Corporation Code of the Philippines and shall comply with the nationality requirements as provided for in the preceding paragraph.[...]" (DOE Circular No. DC2019-10-0013 (or the Omnibus Guidelines Governing the Award and Administration of Renewable Energy Contracts and the Registration of Renewable Energy Developers), 1 October 2019)
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"LIST A: FOREIGN OWNERSHIP IS LIMITED BY MANDATE OF THE CONSTITUTION AND SPECIFIC LAWS [...]
Up to Forty Percent (40%) Foreign Equity [...]
16. Exploration, development and utlization of natural resources (Section 2, Article XII of the Constitution)(10) [Footnote 10: Full foreign participation is allowed through financial or technical asssistance agreements entered into with the President (Section 2, Article XII of the Constitution). [...]
18. Operation of public utilities (Sec. 11, Art XII of the Constitution;¹²[...] [Footnote 12: The participation of foreign investors in the governing body of any public utility enterprise shall be limited to their proportionate share in its capital, and all the executive and managing officers of such corporation or association must be citizens of the Philippines (Article XII, Section 11 of the Constitution)[...]" (Executive Order (EO) No. 175 promulgating the 12th Regular Foreign Investment Negative List (RFINL))
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"SECTION 1. Title and Scope
This Department Circular shall be known as the “Implementing Rules and Regulations (IRR) of Republic Act No. 9513,” otherwise known as the “Renewable Energy Act of 2008,” and hereinafter referred to as the “Act” in this IRR.
The scope of this IRR is to provide rules, regulations, and guidelines for the:
(a)	Exploration, development, utilization and commercialization of renewable energy resources such as biomass, solar, wind, hydropower, geothermal and ocean energy sources, including application of hybrid systems and other emerging renewable energy technologies in the Philippines for the generation, transmission, distribution, sale and use of electricity, and fuel generated from renewable energy resources; [...]
[...]
SEC. 19 Renewable Energy Service/Operating Contact
A. All forces of potential energy and other natural resources are owned by the State and shall not be alienated. These include potential energy sources such as kinetic energy from water, marine current and wind; thermal energy from solar, ocean, geothermal and biomass.
B. Parties to a Service/Operating Contract
The exploration, development, production, and utilization of natural resources shall be under the full control and supervision of the State.
The State may directly undertake such activities, or it may enter into co-production, joint venture or co-production sharing agreements with Filipino citizens or corporations or associations at least sixty percent (60%) of whose capital is owned by Filipinos. Foreign RE Developers may also be allowed to undertake RE development through an RE Service/Operating Contract with the government subject to Article XII, Section 2 of the Philippine Constitution.[...]" (Department Circular No. DC2009-05-0008, RULES AND REGULATIONS IMPLEMENTING REPUBLIC ACT NO. 9513 otherwise known as the "THE RENEWABLE ENERGY ACT OF 2008", Department of Energy, 25 May 2009)
Department Circular No. DC2022-11-0034, PRESCRIBING AMENDMENTS TO SECTION 19 OF DEPARTMENT CIRCULAR NO. DC2009-05-0008, Department of Energy, 15 November 2022
DOE Circular No. DC2019-10-0013 (or the Omnibus Guidelines Governing the Award and Administration of Renewable Energy Contracts and the Registration of Renewable Energy Developers), 1 October 2019
Executive Order (EO) No. 175 promulgating the 12th Regular Foreign Investment Negative List (RFINL)
Department Circular No. DC2009-05-0008, RULES AND REGULATIONS IMPLEMENTING REPUBLIC ACT NO. 9513 otherwise known as the "THE RENEWABLE ENERGY ACT OF 2008", Department of Energy, 25 May 2009
[<a href="https://www.doe.gov.ph/sites/default/files/pdf/issuances/dc2022-11-0034.pdf">Circular</a>],[<a href="https://www.doe.gov.ph/sites/default/files/pdf/issuances/dc2009-05-0008.pdf">Circular</a>],[<a href="https://www.aseanbriefing.com/news/philippines-opens-renewable-energy-to-full-foreign-ownership/">Other</a>],[<a href="https://insightplus.bakermckenzie.com/bm/projects/philippines-renewable-energy-sector-is-now-open-to-full-foreign-ownership">Other</a>],[<a href="https://investmentpolicy.unctad.org/investment-policy-monitor/measures/3572/philippines-allowing-foreign-investors-full-ownership-of-large-scale-geothermal-projects">Other</a>]