SEC Registration: Incorporators, Term and the OPC
Securities and Exchange Commission · business
Quick answer
Under the Revised Corporation Code, up to 15 persons may organise a corporation and each incorporator must own at least one share. Stock corporations need no minimum capital stock, corporate term is perpetual by default, and a single stockholder may form a One Person Corporation.
Every figure on this page is from LawPhil Project's own published documents.
Last verified 1 source, listed below
Republic Act No. 11232, the Revised Corporation Code1. PHGuides is independent and not affiliated with SEC.
Company registration in the Philippines runs on Republic Act No. 11232, the Revised Corporation Code, approved on 20 February 2019. It replaced a 1980 code and changed several things people still get wrong: the number of incorporators, the corporate term, the capital floor and whether one person can incorporate alone.
What the Code requires
| Question | The Code’s answer | Section |
|---|---|---|
| How many incorporators? | Not more than 15 | 10 |
| Minimum shareholding each | At least one share of capital stock | 10 |
| Must incorporators be adults? | Natural persons must be of legal age | 10 |
| Minimum capital stock | None required | 12 |
| Corporate term | Perpetual, unless the articles say otherwise | 11 |
| Single stockholder allowed? | Yes, as a One Person Corporation | 10, 116 |
Section 5 draws a distinction worth keeping straight: corporators are all those who compose a corporation, whether stockholders or members; incorporators are only those named in the articles of incorporation as originally forming the corporation and who signed them.
The One Person Corporation
Title XIII, Chapter III created a form that did not exist before 2019.
A One Person Corporation is a corporation with a single stockholder. Only a natural person, trust or estate may form one.
These may not incorporate as an OPC:
- banks and quasi-banks;
- preneed, trust and insurance companies;
- public and publicly-listed companies;
- non-chartered government-owned and controlled corporations;
- a natural person licensed to exercise a profession, for the purpose of exercising that profession, except as otherwise provided under special laws.
Section 117 confirms an OPC needs no minimum authorised capital stock unless a special law says so. Section 118 requires it to file articles of incorporation under Section 14, and adds that where the single stockholder is a trust or an estate, the articles must name the trustee, administrator, executor, guardian, conservator, custodian or other fiduciary, with proof of authority to act.
Two five-year clocks
Section 21 sets out what happens when a registered company does nothing.
| Situation | Consequence |
|---|---|
| Does not formally organise and commence business within 5 years of incorporation | Certificate of incorporation deemed revoked as of the day following the end of the 5-year period |
| Commenced business, then inoperative for at least 5 consecutive years | Commission may place the corporation under delinquent status, after due notice and hearing |
The first is automatic and needs no hearing. The second is not.
After registration: the reporting duty
Section 177 requires every corporation, domestic or foreign, doing business in the Philippines to submit annual financial statements audited by an independent certified public accountant, plus a general information sheet. There is one relief, and it is drawn by size.
The same ₱600,000.00 threshold appears in three places in the Code, and each names a different officer to certify. This is worth checking against the provision that actually applies to you rather than assuming one answer.
| Section | Applies to | Certified under oath by |
|---|---|---|
| 74 | Right to financial statements | The treasurer and the president |
| 129 | One Person Corporation reporting | The corporation’s treasurer and president |
| 177 | Corporations generally | The corporation’s treasurer or chief financial officer |
Section 74 adds that the threshold may be changed to “such other amount as may be determined appropriate by the Department of Finance”, so the figure is not fixed in the statute forever. Section 129 additionally requires an OPC to file a report containing the president’s explanations or comments on every qualification, reservation, adverse remark or disclaimer the auditor made.
The test is disjunctive in all three: assets under ₱600,000.00 with liabilities above it does not qualify, because either figure reaching the threshold pulls the corporation back into the audit requirement.
What non-compliance costs
The Code prices its own violations, and the ranges are wide because the court or the Commission sets the amount within them. These are the ones a newly registered company is most likely to meet.
| Violation | Section | Fine |
|---|---|---|
| Unauthorised use of a corporate name | 159 | ₱10,000.00 to ₱200,000.00 |
| Administrative sanction for any Code violation | 158 | ₱5,000.00 to ₱2,000,000.00, plus up to ₱1,000.00 a day of continuing violation, capped at ₱2,000,000.00 |
| Failure to maintain records or allow inspection | 161 | ₱20,000.00 to ₱400,000.00 where injurious to the public |
| Wilful certification of false or misleading statements | 162 | ₱20,000.00 to ₱200,000.00, or ₱40,000.00 to ₱400,000.00 where injurious to the public |
| Independent auditor collusion | 163 | ₱80,000.00 to ₱500,000.00, or ₱100,000.00 to ₱600,000.00 where fraudulent |
| Obtaining registration through fraud | 164 | ₱200,000.00 to ₱2,000,000.00, or ₱400,000.00 to ₱5,000,000.00 where injurious to the public |
| Retaliation against whistleblowers | 169 | ₱500,000.00 to ₱1,000,000.00 |
| Any other violation not specifically penalised | 170 | Not less than ₱10,000.00, not more than ₱1,000,000.00 |
Contempt of the Commission carries its own fine under Section 157, not exceeding ₱30,000.00, and where refusal amounts to clear and open defiance of an order, decision or subpoena, a daily fine of ₱1,000.00 until it is complied with. Under Section 170, a violation committed by a corporation can also lead to dissolution after notice and hearing.
What this page does not cover
This page states what the statute requires, not what SEC charges. The SEC fee schedule, the eSPARC and OneSEC filing portals, name verification and reservation, the notarisation of articles, and the processing times for each are published by the Commission on its own website, which could not be read for this page, so no figure for any of them is stated here. It also does not cover foreign corporations’ licence to do business, increases of capital stock, or dissolution.
Related
The DTI business name registration guide covers the sole proprietorship route that does not involve SEC at all, the BMBE registration guide covers the small enterprise exemption, and the mayor’s permit guide covers the local permit every registered company still needs.
Frequently asked questions
- How many people do I need to register a corporation?
- One is enough. Section 10 of RA 11232 allows any person, partnership, association or corporation, singly or jointly with others but not more than 15 in number, to organise a corporation. A corporation with a single stockholder is a One Person Corporation under Title XIII, Chapter III.
- Is there a minimum capital?
- No. Section 12 states that stock corporations shall not be required to have minimum capital stock, except as otherwise specially provided by special law. Section 117 says the same for a One Person Corporation.
- How long does a corporation last?
- Section 11 gives perpetual existence unless the articles of incorporation provide otherwise. Corporations whose certificates were issued before the Code took effect also have perpetual existence unless they vote otherwise.
- Who cannot form a One Person Corporation?
- Only a natural person, trust or estate may form one. Banks and quasi-banks, preneed, trust and insurance companies, public and publicly-listed companies, and non-chartered government-owned and controlled corporations may not. A licensed professional may not organise an OPC to exercise that profession.
- Can professionals incorporate?
- Section 10 says natural persons licensed to practise a profession, and partnerships or associations organised to practise a profession, shall not be allowed to organise as a corporation unless otherwise provided under special laws.
- What happens if the company never starts operating?
- Section 21 revokes the certificate of incorporation as of the day following the end of a 5-year period if the corporation does not formally organise and commence business within 5 years of incorporation. A company that started and then became inoperative for at least 5 consecutive years may be placed under delinquent status after notice and hearing.
- Do small corporations need audited financial statements?
- Section 177 requires annual financial statements audited by an independent CPA, except that if total assets or total liabilities are less than ₱600,000.00 the statements may instead be certified under oath by the corporation's treasurer or chief financial officer.