Ash Eduarte

8/2/2019 Ash Eduarte

1/36

XII CLOSE CORPORATIONS

A corporation whose shareholders and

directors are entitled to operate much like apartnership. Cannot have more than a particular number of

shareholders--between 30 and 35 is the limit


2/36


3/36

ADVANTAGES/DISADVANTAGES

They require fewerformalities thanstandard

corporations. Close corporation

shareholders havea great degree of

control over salesof shares tooutsiders.

Close corporations aregoverned by both lawsand a shareholders'agreement, which are amore complicated andrestrictive set of governance rules.

Shareholders haveincreased responsibilityand participation.

Close corporationsshares have limitedresale value.


4/36

SPECIAL CORPORATIONS

E ducational Corporations

Religious Corporations


5/36

EDUCATIONAL CORPORATION

Those which provides facilities for teaching orinstruction

Trustees of educational institutions organizedas non-stock corporations shall not be less

than five (5) nor more than fifteen (15)


6/36

G ENERAL RULE

N o educational institutions shall be establishedexclusively for foreigners and no group of foreigner shall comprise more than 1/3 of theenrollement in any school

E xception: the rule shall not apply to schoolsestablished for foreign diplomatic personneland their dependents and unless otherwiseprovided by the law for other foreign temporaryresidents


7/36

RELI G IOUS CORPORATIONS

Religious corporation are governed by theappropriate chapter of the code and thegeneral provisions on non-stock corporations

may be incorporated by one or more persons.Such corporations may be classified intocorporations sole and religious societies.


8/36

CORPORATION SOLE

consists of one person only and his successor,who are incorporated by law

Purpose- administration and management, astrustee of the affairs, properties andtemporalities of any religious denomination orchurch


9/36

Any corporation sole may purchase and holdreal estate and personal property for its church,charitable, benevolent or educationalpurposes, and may receive bequests or gifts forsuch purposes.


10/36

RELI G IOUS SOCIETY

a body of person associated together for thepurpose of maintaining religious worship

any religious sociaty or religious order, ordistrict organization of religious denominationor church.


11/36

DISSOLUTION

D issolution of a corporation signifies theextinguishment of its franchise and thetermination of its corporate existence.

VOLUNT ARY DI SSOLUTI ON IN VOLUNT ARY DI SSOLUTI ON


12/36

EFFECTS OF DISSOLUTION

D issolution terminates a corporation s primaryfranchise and generally prevents it fromfurther exercising other or secondary franchiseswhich have been conferred to it.

N o right or remedy in favor of or against anycorporation, its stockholders, members,directors,trustees, or officers, nor any liabilityincurred by any such corporation, stockholders,members,directors, trustees, or officers, shall beremoved or impaired by the subsequentdissolution of saidcorporation.


13/36

VOLUNTARY DISSOLUTION

Termination of an organization's legal existenceby a vote of directors and shareholders ormembers.


14/36

STEPS

1. Majority vote of the board of directors or trustees; 2. Sending of notice to each stockholder or member either

by registered mail or personaldelivery at least 30 days prior to themeeting

;3. Publication of the notice of time, place and subject of the meeting for 3 consecutive weeksin a newspaper published in the place wherethe principal office of said corporation islocated or in a newspaperof general circulation in the Philippines;

4. Resolution adopted by the affirmative vote of the stockholdersowning at least 2/3 of theoutstanding capital stock or 2/3 of themembers at the meeting duly called for the purpose;

5. A copy of the resolution authorizing the dissolution must becertified by a majority of theboard of directors or trustees andcountersigned by the corporate secretary; and6. Issuanceof a certificate of dissolution by the S E C


15/36

DISSOLUTION BY SHORTENIN G THE

TERM

1. Approval by a majority vote of the board ordirectors or trustees.

2. Written notice of the proposed action and

the time and place of meeting shall beserved toeach stockholder or member either bymail or by personal service.

3. Ratification by the stockholders representing at least 2/3 of the outstanding capital stockor 2/3of the members in case of non-stock corporations.

4. Submission of the amended articles of incorporation to the S E C.5. Approval of the S E C


16/36

INVOLUNTARY DISSOLUTION

G rounds for involuntary dissolution 1. Fraud in procuring the certificate of registration;

2. Serious misrepresentation as to what thecorporation can do or is doing to thegreatprejudice of or damage to the general public;

3. Refusal to comply or defiance of any lawfulorder of the Commission restrainingcommission of acts which would amount to a grave violation of itsfranchise;


17/36

4. Continuous inoperation for a periodof at least 5 years;

5. Failure to file by-laws within the required period; and6. Failureto file required reports in appropriate forms asdetermined by the Commissionwithin theprescribed period.


18/36

LIQUIDATION

A dissolved corporation continues as a bodycorporate for a period of 3 years from the timeofdissolution for the purpose of prosecuting and defending suits by or against it andenabling it tosettle and close its affairs, todispose of and convey its property and to

distribute its assets, but notfor the purpose of continuing the business for which it wasestablished.


19/36

F OREI G N CORPORATIONS

those formed, organized or existing under anylaws than those of the philippines and whoselaws allow filipino citizens and corporations todo business in its own country or state.

foreign investors are generally treated like theirdomestic counterparts and must register withthe Securities and E xchange Commission


20/36

foreign ownership exceeds 40% foreigners canhave as much as a 100% equity investmentwith a US$200,000 inward capital remittance.


21/36

FOREIGN CORPORATION, RIGHT TO SUE: If the foreign corporation is transacting or doing

business in the Philippines with a license, ithas the right to sue within the jurisdiction of

the Philippines; If it is transacting or doing business without a

license, it cannot sue; I

f it is not transacting or doing business in thePhilippines, it can sue even if it is notpossessed of any license.


22/36

FOREIGN CORPORATION, RIGHT TO BE SUED:

If it is transacting or doing business in thePhilippines with a license;

If it is transacting or doing business in thePhilippines without a license;


23/36

APPLICATION OF A FOREIGN CORPORATION TOESTABLISH A BRANCH OFFICE IN THE PHILIPPINESS.E.C. FORM NO. F-103

S.E .C. FORM N O. F-103For a Branch Office of a

Foreign CorporationAPPLICATION OF A FOREI G N CORPORATI ON TO E STABLISH A BRAN CH OFFICE IN THE PHILIPP INE S___________________________________________________(N ame of Corporation)hereby applies for a license to transact business in the Philippines asa branch office under Section 125 of Batas Pambansa Blg. 68 andForeign Investments Act of 1991 (RA 7042, as amended) and submitsthe following statements and accompanying documents:1. The applicant is a corporation organized under the laws of

__________________________ on ________ ________________ for a term of _______________ and intends to operate a( ) domestic market enterprise *( ) export market enterprise **2. The location of its principal office is at_____________________________________________________________________(complete address in home country)3. ___________________________________, _______________with

(N ame of Resident Agent) ( N ationality)residence or office address at _______________________________________________________________________ is its resident agent in thePhilippines, authorized to accept summons and legal processes in alllegal proceedings, and all notices affecting the corporation.4. The corporation shall hold office in __________________________

____________________________and operate in _________________________.(Specify place in the Philippines)5. The purpose(s) of said corporation which it intends topursue in the transaction of its business in the Philippines is/are_______________________________________________________________________________________________________________________________________________________________________________________________________________

(Please use additional sheet if necessary)* domestic market enterprise - an enterprise which produces goods for sale, or rendersservices or otherwise engages in any business in the Philippines. This requires assignedcapital of US$200,000.00.** export market enterprise - an enterprise wherein a manufacturer, processor or service(including tourism) enterprise exports sixty percent (60%) or more of its output, or wherein atrader purchases products domestically or exports sixty percent (60%) or more of suchpurchases. Minimum capital required is P5,000.00.

16. The names and addresses of the present directors andofficers of the corporation are as follows:

N AME ADD RE SS E S______________________________ __________________________________________________________________________ __________________________________________________________________________ __________________________________________________________________________ __________________________________________________________________________ ____________________________________________7. The authorized capital stock of the corporation is__________________________________________ roughly equivalent toP_________________ and the aggregate number of shares which thecorporation has authority to issue is _____________________________

(itemized by classes & series, if any)8. The outstanding capital stock of the corporation is__________________________________ and the aggregate number of shares which the corporation has issued is ___ ___________________ allof which are of a par value of __________. (itemized by classes & series, if any)

9.T

he amount actually paid in the treasury of the foreigncorporation is _______________________________________.10. That the applicant or its alien subscriber(s)/partner(s)who are stockholders/partners of an existing corporation/partnershipin the Philippines which is engaged in the same line of business asthat of the applicant are as follows:


24/36

N AME N AME OF CORPORATION /PARTNE RSHIPPE RCENT AG E OFSHARE HOLDIN G SN O. OF DI RE CTORS/PARTNE RS_________________ _________________________ ______________ _________________________________ _________________________ ______________ _________________________________ _________________________ ______________ _________________________________ _________________________ ______________ ________________(Please use additional sheet if necessary)11. That as an export enterprise, the applicant undertakes to

export at least 60% of its total output as indicated hereunder andcommits to submit report of such export to the Board of Investmentsas required by the Implementing Rules of RA 7042 as amended:

Y E AR PROD UCTSTOTAL PROJE CTED SALE SVOLUME /VALUE ***D OME STI CSALE SEX PORT SALE SEX PORT %____ ________ _______________________ __________ _______ __________ ________ _______________________ __________ _______ ______

____ ________ _______________________ __________ _______ __________ ________ _______________________ __________ _______ ______***Please use value in case of products of different kinds and characteristics as well as tothose of the same kind but with various categories using different unit of measurement,volume in case of products of the same kind or category using a common unit of measurement.23

12. That we hereby authorize the Securities and E xchangeCommission and the Bangko Sentral ng Pilipinas to examine andverify the deposit in the ____________________________________________

(N ame of the Bank)in the name of _____________________________________________ of said

(N ame of the Officer)corporation in the amount of __________________________________________________________________________________ which is equivalent to___________________________________________ (P___________________) atthe current rate of exchange, representing the actual remittance of the applicant. This authority is valid and inspection of said deposit

may be made even after the issuance of the license of the company.13. That we manifest our willingness to change our corporatename in the event another person, firm or entity has acquired a priorright to the use thereof or such name is deceptively or confusinglysimilar to one which has prior right.D one this ____ day of _________, 200___ at ____________________.

______________________________________(Signature over printed name of resident agent )

SUBSCRIBED AND SWORN TO before me, this ______ day of _________, 200____ affiant exhibiting to me his/her Community TaxCertificate N o. ____________ issued at __________________ on ______________.

N OTARY PUBLICD oc. N o._______;Page N o. _______;Book N o. _______;Series of 200 ____.


25/36

MISCELLANEOUS PROVISIONS

Outstanding capital stock - means the totalshares of stock issued under binding subscription agreements to subscribers orstockholders, whether or not fully or partiallypaid, except treasury shares.


26/36

De signation of gov er ning boa r ds - Theprovisions of specific provisions of this Code tothe contrary notwithstanding, non-stock orspecial corporations may, through their articlesof incorporation or their by-laws, designate theirgoverning boards by any name other than as

board of trustees.


27/36

Inco r po r ation and oth er f ee s- authorized theSE C to collect and receive fees as authorized bylaw or by rules and regulations promulgated bythe Commission.


28/36

S tock own er ship in c er tain co r po r ations - Inrecommending to the Batasang Pambansa corporations,business or industries to be declared vested with apublic interest and in formulating proposals for

limitations on stock ownership, the N ational E conomicand D evelopment Authority shall consider the type andnature of the industry, the size of the enterprise, theeconomies of scale, the geographic location, the extentof Filipino ownership, the labor intensity of the activity,

the export potential, as well as other factors which aregermane to the realization and promotion of businessand industry.


29/36

Annual re po r t o r co r po r ations - E very corporation,domestic or foreign, lawfully doing business in thePhilippines shall submit to the Securities and E xchangeCommission an annual report of its operations, togetherwith a financial statement of its assets and liabilities,certified by any independent certified public accountantin appropriate cases, covering the preceding fiscal yearand such other requirements as the Securities and

E xchange Commission may require. Such report shall besubmitted within such period as may be prescribed bythe Securities and E xchange Commission.


30/36

C onfid e ntial natu re of ex amination re sults - Allinterrogatories propounded by the Securities andE xchange Commission and the answers thereto,as well as the results of any examination made bythe Commission or by any other official authorizedby law to make an examination of the operations,books and records of any corporation, shall bekept strictly confidential, except insofar as the law

may require the same to be made public or wheresuch interrogatories, answers or results arenecessary to be presented as evidence before anycourt.


31/36

R ul e -making pow er of th e S e cu r iti e s andE xchang e C ommission- The Securities andE xchange Commission shall have the power

and authority to implement the provisions of this Code, and to promulgate rules andregulations reasonably necessary to enable itto perform its duties hereunder, particularly inthe prevention of fraud and abuses on the partof the controlling stockholders, members,directors, trustees or officers.


32/36

V iolations of th e C od e - Violations of any of the provisions of thisCode or its amendments not otherwise specifically penalized thereinshall be punished by a fine of not less than one thousand(P1,000.00) pesos but not more than ten thousand (P10,000.00)pesos or by imprisonment for not less than thirty (30) days but not

more than five (5) years, or both, in the discretion of the court.If theviolation is committed by a corporation, the same may, after notice

and hearing, be dissolved in appropriate proceedings before theSecurities and E xchange Commission: Provided, That suchdissolution shall not preclude the institution of appropriate actionagainst the director, trustee or officer of the corporation responsiblefor said violation: Provided, further, That nothing in this section shallbe construed to repeal the other causes for dissolution of acorporation provided in this Code.


33/36

Am e ndm e nt o r re p e al- N o right or remedy infavor of or against any corporation, itsstockholders, members, directors, trustees, or

officers, nor any liability incurred by any suchcorporation, stockholders, members, directors,trustees, or officers, shall be removed orimpaired either by the subsequent dissolutionof said corporation or by any subsequentamendment or repeal of this Code or of anypart thereof.


34/36

R e p e aling claus e - E xcept as expressly providedby this Code, all laws or parts thereof inconsistent with any provision of this Codeshall be deemed repealed.


35/36

S e pa r ability of p r ovisions- Should any provisionof this Code or any part thereof be declaredinvalid or unconstitutional, the other provisions,so far as they are separable, shall remain inforce.


36/36

Applicability to ex isting co r po r ations- All corporationslawfully existing and doing business in the Philippineson the date of the effectivity of this Code and heretoforeauthorized, licensed or registered by the Securities andE xchange Commission, shall be deemed to have beenauthorized, licensed or registered under the provisionsof this Code, subject to the terms and conditions of itslicense, and shall be governed by the provisions hereof:Provided, That if any such corporation is affected by the

new requirements of this Code, said corporation shall,unless otherwise herein provided, be given a period of not more than two (2) years from the effectivity of thisCode within which to comply with the same.

Date post:	06-Apr-2018
Category:	Documents
Upload:	ash-eduarte
View:	218 times
Download:	0 times

Ash Eduarte

Documents