Opinion No. 19-33 Re: Term of License to do Business of a Foreign Corporation

ecurities and Exchange Commission Republic of the Philippines Department of Finance

OFFICE OF THE GENERAL COUNSEL

09 September 2019

SEC-OGC Opinion No. 19-33 Re: Term of License to do Business of a Foreign Corporation

ROMULO MABANTA BUENAVENTURA SAYOC & DE LOS ANGELES

8767 Paseo de Roxas 21st Floor, Philamlife Tower

Makati City 1226

Attention: Atty. Priscilla B. Valer

Atty. Roxanne Viel C. Santos

Dear Attorneys:

granted by the Commission to a foreign corporation is co-terminus with the life of the foreign corporation. confirmation of your opinion that the license to do business in the Philippines This refers to your letter dated 8 August 2018 requesting for

Your letter states that Pacific Metals Co. Ltd. ("Pacific) is a foreign

issued a license to do business in the Philippines ("SEC License") on 23 stock corporation organized and existing under the laws of Japan. It was

October 1970.

of Incorporation did not provide for a definite corporate term, hence, its corporate term is deemed perpetual or indefinite. incorporated under the laws of Japan is perpetual or indefinite unless its Articles of Incorporation expressly provides a specific term. Pacific's Articles You further stated that, as a general rule, the term of a corporation

the Philippines'("Code) provides that a corporation shall exist for a period On the contrary, however, Section l1 of the then Corporation Code of

the 50th year of its license. is extended. Because of the differing provisions, you are in quandary on not exceeding fifty (50) years from the date of incorporation unless the period whether or not Pacific needs to renew its SEC License before October 2020.

1 Batas Pambansa, Blg. 68.

Page 2 of 2

The pertinent provision applicable to licenses to transact business in the Philippines issued to foreign corporations is Section 126 of the Code which is reproduced under Section 143 of the Revised Corporation Code? ("RCC) , to wit:

license, such foreign corporation may commence to transact business "Section 143. Issuance of a License - xxx Upon issuance of the in the Philippines and continue to do so for as long as it retains its authority to act as a corporation under the laws of the country or State of its incorporation, unless such license is sooner this Code or other special laws. xxx (Emphasis supplied) surrendered, revoked, suspended, or annulled in accordance with

business in the Philippines remains valid, unless sooner surrendered, revoked. corporation still exists legally in its place of incorporation, its license to do From the foregoing, we confirm your opinion. As long as the foreign

suspended, or annulled in accordance with the RCC or other special laws.

solely on the facts disclosed in the query and relevant solely to the particular issues raised therein and shall not be used in the nature of a standing rule It shall be understood that the foregoing opinion is rendered based

binding upon the courts, or upon the Commission in other cases of similar or dissimilar circumstances.3 If upon investigation, it will be disclosed that the facts relied upon are different, this opinion shall be rendered null and void

Please be guided accordingly.

CMMLU S!&ORREA General Counsel

3 SEC Memorandum Circular 2003-15, No. 7 2 Republic Act No. 11232