Just recently, the Securities and Exchange Commission (SEC) issued Memorandum Circular No. 16, series of 2019 providing for guidelines on the number and qualifications of incorporators under Section 10 of the Revised Corporation Code (RCC).
As compared with the previous Corporation Code where incorporators shall only be natural persons comprising of at least five (5) but not more than fifteen (15), the RCC now allows partnership, association or corporation as incorporators.
The following are the salient features of the guidelines:
- A new domestic corporation, two (2) or more persons, but not more than fifteen (15) can be incorporators.
- If a partnership (which must not have a dissolved or expired status) is made an incorporator, the application for registration must be accompanied by a Partners' Affidavit duly executed by all the partners.
- If a domestic corporation is made an incorporator, its investment in the new corporations must be approved by a majority of the board of directors/trustees and ratified by stockholders representing at least two-thirds (2/3) of the outstanding capital stock or of the members in case of non-stock corporations, at a meeting duly called for the purpose.
- If a foreign corporation is made incorporator, the application for registration must be accompanied by a copy of the document duly authenticated by a Philippine Consulate or with an apostille affixed thereto authorizing the foreign corporation to invest in the corporation being formed and specifically naming the designated signatory on behalf of the corporation.
- Lastly, the Tax Identification Number (TIN) of the individuals signing the Articles of Incorporation (AOI) on behalf of an incorporator which is not a natural person, as well as that of the corporation or partnership being represented must both be indicated in the AOI. All documents to be filed with the SEC must contain the TIN of all its foreign investors, natural or juridical, resident or non-resident. Otherwise, they shall not be accepted.
If the intended domestic corporation to be formed will be compliant with the RCC and the above rules, the application for incorporation shall be filed manually with the SEC.
Disclaimer: This article is for general information only and is not intended nor it be construed as a substitute for legal advice on any specific matter. A professional legal advice is still necessary to an actual or particular issue.