Company Formation in the Philippines: Documentary Requirements for Company

Incorporation
Local and foreign entities seeking to establish a business in the Philippines are required
to submit documents to the Securities and Exchange Commission (SEC) to secure
a Certificate of Incorporation, a document that grants juridical existence to an enterprise
and allows it to legally engage in business in the Philippines.
The documentary requirements for incorporation should be filed with the SEC – the
processing timeline of which depends on the nature of business, list of proposed
business activities, ownership structure (percentage of Filipino and foreign
ownership), paid-up capital, licenses and permits from special government units (if
looking to engage in a regulated industry), and other such purposes.
Provided that all documents are submitted and all supporting information are placed in
order, applications for registration of new corporations/partnerships with the SEC are
usually processed within seven (7) days from the date of filing.
Stock Corporations
Types:

 Domestic Corporation (organized under Philippine Laws)

o 100% Filipino-owned
o 60% Filipino-owned and 40% Foreign-owned
o 40.01% to 100% Foreign-owned (subject to certain provisions under
Foreign Investments Act)

 Foreign Corporation (organized under the laws of the corporation’s country of

origin)
o Branch Office
o Representative Office
o Regional Area Headquarters (RHQ)
o Regional Operating Headquarters (ROHQ)

REQUIRED DOCUMENTS FOR INCORPORATION OF A STOCK

CORPORATION

 Name Verification Slip (through SEC’s website or at the Name Verification Unit

at SEC’s office building)
 Articles of Incorporation and By-Laws
 Treasurer’s Affidavit
 Notarized Bank Certificate of Deposit (notarized in place where bank is
located)
 Written Undertaking to Change Corporate Name by any Incorporator or Director
 Endorsement or Clearance from other government agencies (if company will
engage in a regulated industry)
  Foreign Investment Application Form F-100 (for subsidiaries of foreign
corporations)
 Proof of Inward Remittance by Non-Resident Aliens/Subscribers 
Foreign corporations, having been incorporated in their country of origin, are no longer
required to undergo the incorporation process. Instead, they are required to secure a
License to Operate from the SEC to be able to set up operations in the Philippines.

Required Documents for a Foreign Corporation to Obtain a License to Operate

(in addition to the documents for incorporation listed above)

 Foreign Investment Application Forms

o Form F-103 – Branch Office
o Form F-104 – Representative Office
o Form F-108 – Branch/Representative Office of a Non-Stock Foreign
Corporation
o Application Form for Regional Headquarters (RHQ) / Regional Operating
Headquarters (ROHQ)
 Proof of Inward Remittance by parent company (except for
Branch/Representative Office of Non-Stock Foreign Corporations)
 Authenticated Board Resolution authorizing establishment of office in the
Philippines
 Latest Financial Statements of Applicant (certified by an independent Certified
Public Accountant (CPA) in home country and authenticated by the Philippine
consulate/embassy)
 Certified Copies of the Articles of Incorporation and By-Laws (of the parent
company abroad)
 Acceptance of Appointment of Resident Agent (if resident agent is not the
signatory of the application form)
 Affidavit executed by the President or Resident Agent stating that the foreign
corporation is solvent and sound in its financial condition
 Authenticated Certification that foreign corporation is engaged in international
trade with affiliates, subsidiaries or branch offices in the Asia-Pacific region and
other areas (only for RHQ and ROHQ)
 Authenticated Certification from principal office of foreign entity that it was
authorized by its Board of Directors or governing body to establish RHQ or
ROHQ in the Philippines (only for RHQ and ROHQ)
Non-Stock Corporations

Required Documents for Incorporation of a Non-Stock Corporation

 Name Verification Slip (through SEC’s website or at the Name Verification Unit

at SEC’s office building)
 Articles of Incorporation and By-Laws
  Bank Certificate of Deposit of at least Php 1 million, and a Statement of
Willingness to allow the Commission to conduct an audit (only applicable for
registering a Foundation)
 Written Undertaking to Change Corporate Name by any Trustee
 List of members and amount contributed certified by the Secretary and
Treasurer
 Copy of the Certificate of election or letter of appointment of a bishop, rabbi,
presiding priest, etc. (only for Corporation Sole)
 Master Deed duly entered under the primary entry of the concerned Register of
Deeds and Certification that there is no existing similar corporation within the
condominium (only for Condominium Corporations)
 Certification from the Housing and Land Use Regulatory Board (HLURB)
that there is no other existing homeowners or similar associations in the
community where the association is to be established (only for Neighborhood
Associations)

Required Documents for Incorporation of a Partnership

 Name Verification Slip (through SEC’s website or at the Name Verification Unit

at SEC’s office building)
 Articles of Partnership (for Limited Partnerships, this should be executed under
oath “JURAT”)
 Written Undertaking to Change Corporate Name by any Partner
 Form F-105 for partnerships with Foreign Equity
 Proof of Inward Remittance by foreign partners

Incorporators
Incorporators are the stockholders mentioned in the Articles of Incorporation as
originally forming or composing the corporation. They are the signatories of the Articles
of Incorporation. There cannot be more than fifteen (15) incorporators. Incorporators
may be a natural person, a partnership, an association or corporation. Incorporators of a
stock corporation must own or be a subscriber to at least one (1) share of the capital
stock of the corporation.
Foreigners are generally allowed to be incorporators provided that the requirements of
the incorporators are complied with and the business activity of the corporation is not
fully reserved for Filipino ownership. Examples of business activities that are fully
reserved to Filipino ownership are mass media (except recording), retail trade with paid
up capital of less than US$2,500,000.00, cooperatives, and private securities agencies.

Section 10. Number and Qualifications of Incorporators. Any person, partnership,

association or corporation, singly or jointly with others but not more than fifteen (15) in
number, may organize a corporation for any lawful purpose or purposes; Provided, That
natural persons who are licensed to practice a profession, and partnerships or
associations organized for the purpose of practicing a profession, shall not be allowed
to organize as a corporation unless otherwise provided under special laws.
Incorporators who are natural persons must be of legal age.

Each incorporator of stock corporation must own or be a subscriber to at least one (1)
share of the capital stock.

A corporation with a single stockholder is considered a One Person Corporation as

described in Title XIII, Chapter III of this Code.

Directors
The number of directors of a corporation cannot be more than fifteen
(15) directors. Directors exercise the corporate powers of the corporation, conduct all
business, and control and hold all properties of the corporation. They are elected from
the stockholders of the corporation and hold office for one (1) year until their successors
are elected and qualified.
Directors must be natural persons (another corporation can't be a director) of legal age.
They must own at least one (1) share of the capital stock of the corporation of which he
is a director and said share should be recorded in his name in the books of the
corporation. A person is disqualified from being a director of any corporation if, within
five (5) years before the election or appointment, the person was:
1. Convicted by final judgment of (a) an offense punishable by imprisonment for a
period exceeding six years, or (b) a violation of the Revised Corporation Code or (c) a
violation of the Securities Regulation Code;
2. Found administratively liable for any offense involving acts of fraud;
3. Found liable by a foreign court or equivalent foreign regulatory authority for acts,
violations, or misconduct similar to those enumerated in (1) and (2).

Foreigners may generally be directors of a corporation except for business activities that

are fully reserved for Filipinos such as mass media (except recording), retail trade with
paid up capital of less than US$2,500,000.00, cooperatives, and private securities
agencies among others. If the business activities of the corporation is partially
nationalized, such as private recruitment (75% Filipino ownership), advertising (70%
Filipino ownership), operation of public utilities (60% Filipino ownership), and ownership
of private land (60% Filipino ownership), among others, the number of seats for
foreigners in the board of directors is in proportion of their present foreign equity to the
number of directors.

Section 22. The Board of Directors or Trustees of a Corporation; Qualification and

Term. – Unless otherwise provided in this Code, the board of directors or trustees shall
exercise the corporate powers, conduct all business, and control all properties of the
corporation.
 Directors shall be elected for a term of one (1) year from among the holders of stocks
registered in the corporation’s books while trustee shall be elected for a term not
exceeding three (3) years from among the members of the corporation. Each director
and trustee shall hold office until the successor is elected and qualified. A director who
ceases to own at least one (1) share of stock or a trustee who ceases to be a member
of the corporation shall cease to be such.

The board of the following corporations vested with public interest shall have
independent directors constituting at least twenty percent (20%) of such board;

 (a) Corporations covered by Section 17.2 of Republic Act No. 8799, otherwise
known as “The Securities Regulation Code”, namely those whose securities are
registered with the Commission, corporations listed with an exchange or with assets
of at least Fifty million pesos (P50,000,000.00) and having two hundred (200) or more
holders of shares, each holding at lease one hundred (100) shares of  class of its
equity shares:
 (b) Banks and quasi-banks, NSSLAs, pawnshops, corporations engaged in
money service business, preneed, trust and insurance companies, and other financial
intermediaries; and,
 (c) Other corporations engaged in business vested with public interest similar to
the above, as may be determined by the Commission, after taking into account
relevant factors which are germane to the objective and purpose of requiring the
election of an independent director, such as extent of minority ownership, type of
financial products or securities issued or offered to investors, public interest involved
in the nature of business operations, and other analogous factors.

An independent director is a person who, apart from shareholdings and fees received
from the corporation, is independent of management and free from any business of
other relationship which could, or could reasonably be perceived to materially interfere
with the exercise of independent judgement in carrying out the responsibilities as
director.

Independent directors must be elected by the shareholders present or entitled to vote in

absentia during the election of directors. Independent director shall be subject to rules
and regulations governing their qualifications, disqualifications, voting requirements,
duration of term and term limit, maximum number of board memberships and other
requirements that the Commission will prescribe to strengthen their independence and
align with international best practices.

Articles of incorporation are a set of formal documents filed with a government body to
legally document the creation of a corporation. Articles of incorporation generally
contain pertinent information, such as the firm’s name, street address, agent for service
of process, and the amount and type of stock to be issued.
 Articles of incorporation are also referred to as the "corporate charter," "articles of
association," or "certificate of incorporation."
Section 13. Contents of the Articles of Incorporation. – All corporations shall file with the
Commission articles of incorporation in any of the official languages, duly signed and
acknowledged or authenticated, in such form and manner as may be allowed by the
Commission, containing substantially the following matters, except as otherwise
prescribed by this Code or by special law:

 (a) The name of the Corporation;

 (b) The specific purpose or purposes for which the corporation is being formed.
Where a corporation has more than one stated purpose, the articles of incorporation
shall indicate the primary purpose and the secondary purpose or purposes: Provided,
That a nonstock corporation may not include a purpose which would change or
contradict its nature as such;
 (c) The place where the principal office of the corporation is to be located, which
must be within the Philippines;
 (d) The term for which the corporation is to exist, if the corporation has not
elected perpetual existence;
 (e) The names, nationalities, and residence addresses of the incorporators;
 (f) The number of directors, which shall not be more than fifteen (15) or the
number of trustees which may be more than fifteen (15);
 (g) The names, nationalities, and residence addresses of persons who will act as
directors or trustees until the first regular directors or trustees are duly elected and
qualified in accordance with this Code;
 (h) If it be a stock corporation, the amount of its authorized capital stock, number
of shares into which it is divided, the par value of each, names, nationalities, and
residence address of the original subscribers, amount subscribed and paid by each
on the subscription, and a statement that some or all of the shares are without par
value, if applicable;
 (i) If it be a nonstock corporation, the amount of its capital, the names,
nationalities, and residence addresses of the contributors, and amount contributed by
each; and,
 (j) Such other matters consistent with law and which incorporators may deem
necessary and convenient.

An arbitration agreement may be provided in the articles of incorporation pursuant to

Section 181 of this Code.

The articles of incorporation and applications for amendments thereto may be filed with
the Commission in the form of an electronic document, in accordance with the
Commission’s rules and regulations on electronic filing.
 Section 15. Amendment of Articles of Incorporation. – Unless otherwise prescribed by
this Code or by special law, and for legitimate purposes, any provision or matter stated
in the articles of incorporation may be amended by a majority vote of the board of
directors or trustees and the vote or written assent of the stockholders representing at
least two-thirds (2/3) of the outstanding capital stock, without prejudice to the appraisal
right of dissenting stockholders in accordance with the provisions of this Code. The
articles of incorporation of a nonstock corporation may be amended by the vote or
written assent of the majority of trustees and at least two-thirds (2/3) of the members.

The original and amended articles together shall contain all provisions required by law
to set out in the articles of incorporation. Amendments to the articles shall be indicated
by underscoring the change or changes made, and a copy thereof duly certified under
oath by the corporate secretary and majority of the directors or trustees, with a
statement that the amendment have been duly approved by the required vote of the
stockholders or members shall be submitted to the Commission.

The amendment shall take effect upon their approval by the Commission or from the
date of filing with the said Commission if not acted upon within six (6) months from the
date of filing for a cause not attributable to the corporation.

Section 16. Grounds When Articles of Incorporation or Amendment May be

Disapproved. – The Commission  may disapprove articles of incorporation or any
amendment thereto if the same is not compliant with the requirements of this Code:
Provided, That the Commission shall give the incorporators, directors, trustees, or
officers a reasonable time from receipt of the disapproval within which to modify the
objectionable portions of the articles or amendment. The following are the grounds for
such disapproval:

 (a) The articles of incorporation or any amendment thereto is not substantially in

accordance with the form prescribed herein;
 (b) The purpose or purposes of the corporation are patently unconstitutional,
illegal, immoral or contrary to government rules and regulations;
 (c) The certification concerning the amount of capital stock subscribed and/or
paid is false; and,
 (d) The required percentage of Filipino ownership of the capital stock under
existing laws or the Constitution has not been complied with.

No articles of incorporation or amendment to articles of incorporation of banks, banking

and quasi-banking institutions, preneed, insurance and trust companies, NSSLAs,
pawnshops, and other financial intermediaries shall be approved by the Commission
unless accompanied by a favorable recommendation of the appropriate government
agency the effect that such articles or amendment is in accordance with law.
 Section 17. Corporate Name. – No corporate name shall be allowed by the Commission
if it is not distinguishable from that already reserved or registered for the use of another
corporation, or if such name is already protected by law, or when its use is contrary to
existing law, rules and regulations.

A name is not distinguishable even if it contains one or more of the following:

 (a) The word “corporation”, “company”, “incorporated”, “limited”, “limited liability”,

or an abbreviation of one of such words; and,
 (b)  Punctuations, articles, conjunctions, different tenses, spacing, or number of
the same word or phrase.

The Commission, upon determination that the corporate name is: (1) not distinguishable
from a name already reserved or registered for use of another corporation; (2) already
protected by law; or (3) contrary to law, rules and regulations may summarily order the
corporation for immediately cease and desist from using such name and require the
corporation to register new one, The Commission shall also cause the removal of all
visible signages, marks, advertisements, labels, prints, and other effects bearing such
corporate name. Upon the approval of the new corporate name, the Commission shall
issue a certificate of incorporation under the amended name.

If the corporation fails to comply with the Commission’s order, the Commission may
hold the corporation and its responsible directors or officers in contempt and/or hold
them administratively, civilly and/or criminally liable under this Code and other
applicable laws and/or revoke the registration of the corporation.

The following are guidelines for choosing a company name:

 It must not be the same as an existing company name

 There must not be a similar company name already registered
 Using a dissolved company name is permitted
 Upper and lower case company names do not distinguish one from another
which current exists
 The use of Reserved or sensitive words require justification
 The company name must end with the word "limited".
 It must not be an abusive, offensive or illegal name

Section 11. Corporate Term. – A corporation shall have perpetual existence unless its
articles of incorporation provides otherwise.

Corporations with certificates of incorporation issued prior to the effectivity of this Code,
and which continue to exist, shall have perpetual existence, unless the corporation,
upon a vote of its stockholders representing a majority of its outstanding capital stock,
notifies the Commission that it elects to retain its specific corporate term pursuant to its
articles of incorporation: Provided, That any change in the corporate term under this
section is without prejudice to the appraisal right of dissenting stockholders in
accordance with the provisions of this Code.

A corporate term for a specific period may be extended or shortened by amending the
articles of incorporation: Provided, That no extension may be made earlier than three
(3) years prior to the original or subsequent expiry date(s) unless there are justifiable
reasons for an earlier extension as may be determined by the Commission: Provided,
further, That such extension of the corporate term shall take effect only on the day
following the original or subsequent expiry date(s).

A corporation whose term has expired may apply for a revival of its corporate existence,
together with all the rights and privileges under its certificate of incorporation and
subject to all of its duties, debts and liabilities existing prior to its revival. Upon approval
by the Commission, the corporation shall be deemed revived and a certificate of revival
of corporate existence shall be issued, giving it perpetual existence, unless its
application for revival provides otherwise.

No application for revival of certificate of incorporation of banks, banking and quasi-

banking institutions, preneed, insurance and trust companies, non-stock savings and
loan associations (NSSLAs), pawnshops, corporations engaged in money service
business, and other financial intermediaries shall be approved by the Commission
unless accompanied by a favorable recommendation of the appropriate government
agency.