SEC Registration Requirements for Stock Corporation

Here are the requirement that you need to prepare in connection with the registration of a stock corporation with the Philippine Securities and Exchange Commission (SEC).

1) COVER SHEET

2) NAME VERIFICATION SLIP

3) BANK CERTIFICATE OF DEPOSIT OF PAID-UP CAPITAL (notarized in the place executed)

4) ARTICLES OF INCORPORATION

5) TREASURER’S AFFIDAVIT

6) BY-LAWS

7) UNDERTAKING TO CHANGE NAME (not required if provided in the Articles of Incorporation)

HOWEVER, additional requirements such as: (1) Indorsement/clearance from other government agencies, if applicable (2) For corporations with foreign equity, submit proof of inward remittance by non-resident aliens and foreign corporate subscribers who    want to register their investment with BSP; (3) For corporations with more than 40% Foreign equity, submit SEC Form No. F – 100; (4) For corporations with Phil. Economic Zone Authority (PEZA), Subic Bay Metropolitan Authority (SBMA) or other economic zones application, attach Certificate of Authority or indorsement from said government agencies.

Of course, as of my last inquiry,  the cost associated with the registration are (1) Filing Fee:  1/5 of 1% of the Authorized Capital Stock but not less than Php1,000.00 (2) By Laws: Php510.00 and (3) Legal Research Fee:  1% of Filing Fee but not less than Php10.00.

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How to extend or shorten the life of a Corporation

The Corporation Code of the Philippines under section 37 allows a corporation to “extend” as well as to “shorten” its term of existence. Dissolving a corporation prior to its expiration, say 50 years, or whatever the term fixed in the Articles of Incorporation, can be done by amending the Articles of Incorporation to shorten the term or vice-versa. When the shorter term expires, then the corporation is automatically dissolved, and its corporate assets liquidated.

Section 37 of the corporation code is all about the Power to extend or shorten a corporate term. A private corporation may extend or shorten its term as stated in the Articles of Incorporation when approved by a majority vote of the Board and ratified at a meeting by the stockholders representing at least 2/3 of the outstanding capital stock/members. A written notice of the proposed action and of the time and place of the meeting shall be addressed to each stockholder or member at his place of residence as shown on the books of the corporation and deposited to the addressee in the post office with postage prepaid, or served personally: Provided, that in case of extension of the corporate term, any dissenting stockholder may exercise his appraisal right under the conditions provided in this Code.

HOWEVER, in the case of increase or reduction of capital stock, any change in a corporate term has to be approved at a members’ or stockholders’ meeting. Unlike in increase or reduction of capital stock, any stockholder who dissents to the extension or shortening of the term may exercise his appraisal right.

This is the  procedure to be followed after the stockholders had approved it.

(1) File duly certified copy of the AOI as amended with the SEC; and

(2)  Amendment takes effect upon SEC approval, except if SEC fails to act within 6 months from filing for causes not attributable to the corporation, then the amendment will take effect even without SEC approval.

How to register a NON-Stock, NON-Profit CORPORATION with the Philippines SEC

This blog is having a lot of queries on how to register a non-stock and non-profit corporation. Thus, I thought that it’s about time to write one for all the readers and by passer out there. Anyhow, I tried to run a query via google search engine, and some relevant sites came up with the same answers. Next, I checked out SEC and to my surprise the procedures still are the same. So, for the benefits of those who are surfing, reading, visiting and passing by my blog, here are the steps to be followed:

1. Verify and reserve the proposed corporate name. You could do this the hard way, at the SEC Verification Unit, located at the SEC Building, EDSA, Greenhills, Mandaluyong City (right across the Philippine Overseas Employment Administration [POEA] and the EDSA Shrine). If you want to make your life a bit easier, you could do the verification and registration online, through the SEC-iRegister, a 24-7 portal.  After paying the reservation fee, you will get a Name Verification Slip, which is submitted together with the other requirements.

2. Prepare the Articles of Incorporation and By-laws. Blank forms are also available from the Company Registration and Monitoring Department (CRMD). The drafting of the Articles of Incorporation and the By-laws, as well as the other requirements, could also be done by your lawyer.

HOWEVER, in lieu of the authorized capital stock requiring 25% subscriptions of the authorized capital stocks and the attestation in the Treasurer’s affidavit that at least 25% of the subscribed stocks had been paid, for non-stock/non-profit corporation, it only requires the corporation to state the amount of capital or money contributed or donated by specified persons.

So there…

Ah, plus the names, nationalities, and residences of the contributors or donors as well as the respective amounts given by each.  And remember it must be on an itemized presentation.  Take note also, and this is a major major requirement, the majority of members should be a resident of the Philippines.  With this provision, a foreigner can put up 100% foreign owned non-stock, non-profit corporation. Why, because the “code” only requires that the majority of its members should have Philippine residency.

3. Last step is the submission of a Bank Certificate of Paid In Capital or Working Capital to Philippine Securities and Exchange Commission.

ANYHOW, for Foundation —

(a) a notarized Certificate of Bank Deposit of the contribution of not less than P1,000,000.00 ; and

(b) a statement of willingness to allow the Commission to conduct an audit.