The existing law governing corporations in the Philippines is Republic Act No. 11232, also known as the “Revised Corporation Code“. R.A. 11232 was signed by President Rodrigo R. Duterte on 20 February 2019. This is an introduction to the Revised Corporation Code.
EFFECTIVITY
R.A. 11232 provides that it shall take effect upon completion of its publication in the Official Gazette or in at least two newspapers of general circulation. R.A. 11232 was published in Manila Bulletin and the Business Mirror on 23 February 2019. The Revised Corporation Code, therefore, took effect on 23 February 2019.
PRIOR LAW
Prior to the effectivity of the Revised Corporation Code on 23 February 2019, the law which governs the registration and operation of corporations in the Philippines is Batas Pambansa Blg. 68, otherwise known as the “Corporation Code of the Philippines.” B.P. 68, which became law on 1 May 1980, was expressly repealed by R.A. 11232. [Sec. 187]
EFFECT ON EXISTING CORPORATIONS
A corporation lawfully existing and doing business in the Philippines affected by the new requirements of the Revised Corporation Code shall be given a period of not more than two (2) years from its effectivity within which to comply (Sec. 185).
APPLICABILITY TO SPECIAL LAWS
Nothing in R.A. 11232 shall be construed as amending existing provisions of special laws governing the registration, regulation, monitoring and supervision of special corporations such as banks, nonbank financial institutions and insurance companies.
Notwithstanding any provision to the contrary, regulators such as the Bangko Sentral ng Pilipinas (BSP) and the Insurance Commission (IC) shall exercise primary authority over special corporations such as banks, nonbank financial institutions, and insurance companies under their supervision and regulation. [Sec. 183]
JURISDICTION OVER PARTY-LIST ORGANIZATIONS
The powers, authorities, and responsibilities of the Securities and Exchange Commission (SEC) involving party-list organizations are transferred to the Commission on Elections (COMELEC). Within six (6) months after the effectivity of R.A. 11232, the monitoring, supervision, and regulation of such corporations shall be deemed automatically transferred to the COMELEC (Sec. 182). [See also Powers and Jurisdiction of the SEC]
SALIENT CHANGES
There are numerous substantial changes in the Revised Corporation Code. For instance, One Person Corporations are now allowed. Corporations now have perpetual existence by default, instead of the maximum of 50 years under the old law. These changes, as well as the rest of the discussions, will be listed in the Table of Contents.
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