SEC Registration in the Philippines: Requirements, Steps, and Fees

To register a corporation in the Philippines, the incorporators must submit the intended corporate name to the Securities and Exchange Commission (SEC) for verification, then file the articles of incorporation and bylaws. Under Section 18 of the Revised Corporation Code (Republic Act No. 11232), the SEC issues the certificate of incorporation if the submitted documents are fully compliant with the law. A private corporation's legal existence begins only on the date the SEC issues this certificate. This guide walks through the requirements, the step-by-step process, and the legal rules that apply.

Who Can Incorporate?

Under Section 10 of the Revised Corporation Code, any person, partnership, association, or corporation may organize a corporation, singly or jointly with others, but not more than fifteen (15) incorporators are allowed. Natural persons who are incorporators must be of legal age. Each incorporator of a stock corporation must own or subscribe to at least one share of the capital stock.

The law also allows a single person to form a One Person Corporation (OPC), which is a corporation with a single stockholder. However, professionals licensed to practice a profession, and partnerships or associations organized for practicing a profession, cannot organize as a corporation unless a special law allows it.

Key Requirements for the Articles of Incorporation

Section 13 of the Revised Corporation Code lists the contents of the articles of incorporation. The document must be filed with the SEC in any of the official languages, duly signed and acknowledged. It must contain substantially the following:

• The name of the corporation
• The specific purpose or purposes (primary and secondary, if more than one)
• The place of the principal office, which must be within the Philippines
• The corporate term (or a statement of perpetual existence)
• The names, nationalities, and residence addresses of the incorporators
• The number of directors (not more than 15) or trustees
• The names of the initial directors or trustees
• For stock corporations: the authorized capital stock, number of shares, par value, and the subscription details
• For nonstock corporations: the amount of capital and the contributors' details

The articles may be filed as an electronic document, in accordance with the SEC's rules on electronic filing.

The Corporate Name Rule

Section 17 of the Revised Corporation Code states that no corporate name will be allowed if it is not distinguishable from a name already reserved or registered, if it is already protected by law, or if its use is contrary to law. A name is not distinguishable even if it merely adds words like "corporation," "incorporated," or "limited," or if it differs only by punctuation, articles, conjunctions, contractions, prepositions, abbreviations, different tenses, spacing, or number.

If the SEC finds that a registered name violates this rule, it may order the corporation to cease using the name and register a new one. The SEC can also remove signages and other materials bearing the offending name.

Step-by-Step Registration Process

Under Section 18 of the Code, the registration process follows these steps:

1. Verify and reserve the corporate name. Submit the intended name to the SEC for verification. If it is distinguishable and not protected or contrary to law, the name is reserved in favor of the incorporators.
2. Prepare and file the documents. Submit the articles of incorporation and the bylaws to the SEC.
3. Wait for SEC review. The SEC checks whether the documents comply with the Code and other relevant laws and regulations.
4. Receive the certificate of incorporation. If compliant, the SEC issues the certificate under its official seal. The corporation's juridical personality starts on this date.

Minimum Capital Stock and Shares

Section 12 of the Revised Corporation Code provides that stock corporations are not required to have a minimum capital stock, except when a special law specifically requires it. The articles must state the authorized capital stock, the number of shares, and the par value of each share.

Shares may be issued with or without par value. However, banks, trust, insurance, and preneed companies, public utilities, building and loan associations, and other corporations authorized to obtain funds from the public cannot issue no-par value shares. No-par value shares must be issued for a consideration of at least Five pesos (P5.00) per share.

Grounds for Disapproval

Section 16 of the Code lists the grounds on which the SEC may disapprove the articles of incorporation or an amendment:

• The articles are not substantially in the prescribed form
• The purpose is patently unconstitutional, illegal, immoral, or contrary to government rules
• The certification on subscribed or paid capital is false
• The required percentage of Filipino ownership under the Constitution or laws is not met

The SEC must give the incorporators a reasonable time to modify the objectionable portions.

Frequently Asked Questions

How many incorporators are needed to register a corporation in the Philippines? Under Section 10 of the Revised Corporation Code, a corporation may be organized by one to fifteen incorporators. A single stockholder forms a One Person Corporation.

Is a minimum capital required for SEC registration? Generally, no. Section 12 states that stock corporations are not required to have a minimum capital stock, unless a special law (such as those for banks or other regulated industries) requires it.

When does a corporation legally exist? Under Section 18, a corporation commences its corporate existence and juridical personality on the date the SEC issues the certificate of incorporation.

Practical Takeaways

• Verify and reserve your corporate name with the SEC before filing the full application.
• Prepare the articles of incorporation and bylaws carefully; the SEC will reject documents that do not substantially follow the prescribed form.
• Check whether your business activity requires a special law or a favorable recommendation from a government agency before the SEC will approve the registration.
• Remember that the corporation only exists legally once the SEC issues the certificate of incorporation.
• If the corporation does not formally organize and commence business within five years from incorporation, the certificate of incorporation may be revoked under Section 21 of the Code.

This article is general information and not legal advice. For your specific situation, consult a lawyer or ask ASG Legal AI.