- TITLE I - GENERAL PROVISIONS DEFINITIONS AND CLASSIFICATIONS
- Section 1. Title of the Code.
- Section 2. Corporation defined.
- Section 3. Classes of corporations.
- Section 4. Corporations created by special laws or charters.
- Section 5. Corporators and incorporators, stockholders and members
- Section 6. Classification of shares.
- Section 7. Founders' shares
- Section 8. Redeemable shares
- Section 9. Treasury shares.
- TITLE II - INCORPORATION AND ORGANIZATION OF PRIVATE CORPORATIONS
- Section 10. Number and qualifications of incorporators
- Section 11. Corporate term
- Section 12. Minimum capital stock required of stock corporations.
- Section 13. Amount of capital stock to be subscribed and paid for the purposes of incorporation.
- Section 14. Contents of the articles of incorporation
- Section 15. Forms of Articles of Incorporation
- Section 16. Amendment of Articles of Incorporation
- Section 17. Grounds when articles of incorporation or amendment may be rejected or disapproved
- Section 18. Corporate name
- Section 19. Commencement of corporate existence.
- Section 20. De facto corporations.
- Section 21. Corporation by estoppel
- Section 22. Effects on non-use of corporate charter and continuous inoperation of a corporation.
- TITLE III - BOARD OF DIRECTORS/TRUSTEES AND OFFICERS
- Section 23. The board of directors or trustees
- Section 24. Election of directors or trustees
- Section 25. Corporate officers, quorum.
- Section 26. Report of election of directors, trustees and officers.
- Section 27. Disqualification of directors, trustees or officers
- Section 28. Removal of directors or trustees
- Section 29. Vacancies in the office of director or trustee.
- Section 30. Compensation of directors.
- Section 31. Liability of directors, trustees or officers.
- Section 32. Dealings of directors, trustees or officers with the corporation.
- Section 33. Contracts between corporations with interlocking directors.
- Section 34. Disloyalty of a director.
- Section 35. Executive committee
- TITLE IV - POWERS OF CORPORATIONS
- Section 36. Corporate powers and capacity
- Section 37. Power to extend or shorten corporate term
- Section 38. Power to increase or decrease capital stock; incur, create or increase bonded indebtedness.
- Section 39. Power to deny pre-emptive r
- Section 40. Sale or other disposition of assets
- Section 41. Power to acquire own shares.
- Section 41. Power to acquire own shares.
- Section 42. Power to invest corporate funds in another corporation or business or for any other purpose
- Section 43. Power to declare dividends
- Section 44. Power to enter into management contract
- Section 45. Ultra vires acts of corporations.
- TITLE V - BY LAWS
- TITLE VI - MEETINGS
- Section 49. Kinds of meetings
- Section 50. Regular and special meetings of stockholders or members.
- Section 51. Place and time of meetings of stockholders of members
- Section 52. Quorum in meetings
- Section 53. Regular and special meetings of directors or trustees.
- Section 54. Who shall preside at meetings
- Section 55. Right to vote of pledgors, mortgagors, and administrators
- Section 56. Voting in case of joint ownership of stock.
- Section 57. Voting right for treasury shares.
- Section 58. Proxies
- Section 59. Voting trusts.
- TITLE VII - STOCKS AND STOCKHOLDERS
- Section 60. Subscription contract.
- Section 61. Pre-incorporation subscription
- Section 62. Consideration for stocks
- Section 63. Certificate of stock and transfer of shares
- Section 64. Issuance of stock certificates
- Section 65. Liability of directors for watered stocks
- Section 66. Interest on unpaid subscriptions.
- Section 67. Payment of balance of subscription
- Section 68. Delinquency sale
- Section 69. When sale may be questioned
- Section 70. Court action to recover unpaid subscription
- Section 71. Effect of delinquency
- Section 72. Rights of unpaid shares
- Section 73. Lost or destroyed certificates
- TITLE VIII - CORPORATE BOOKS AND RECORDS
- TITLE IX - MERGER AND CONSOLIDATION
- TITLE X - APPRAISAL RIGHT
- TITLE XI - NON-STOCK CORPORATIONS
- TITLE XII - CLOSE CORPORATIONS
- Section 96. Definition and applicability of Title
- Section 97. Articles of incorporation.
- Section 98. Validity of restrictions on transfer of shares.
- Section 99. Effects of issuance or transfer of stock in breach of qualifying conditions
- Section 100. Agreements by stockholders
- Section 101. When board meeting is unnecessary or improperly held
- Section 102. Pre-emptive right in close corporations
- Section 103. Amendment of articles of incorporation
- Section 104. Deadlocks
- Section 105. Withdrawal of stockholder or dissolution of corporation
- TITLE XIII - SPECIAL CORPORATIONS
- CHAPTER I EDUCATIONAL CORPORATIONS
- CHAPTER II RELIGIOUS CORPORATIONS
- Section 109. Classes of religious corporations
- Section 110. Corporation sole
- Section 111. Articles of incorporation
- Section 112. Submission of the articles of incorporation
- Section 113. Acquisition and alienation of property
- Section 114. Filling of vacancies
- Section 115. Dissolution
- Section 116. Religious societies
- TITLE XIV - DISSOLUTION
- TITLE XV - FOREIGN CORPORATIONS
- Section 123. Definition and rights of foreign corporations
- Section 124. Application to existing foreign corporations
- Section 125. Application for a license
- Section 126. Issuance of a license.
- Section 127. Who may be a resident agent
- Section 128. Resident agent; service of process
- Section 129. Law applicable
- Section 130. Amendments to articles of incorporation or by-laws of foreign corporations.
- Section 131. Amended license
- Section 132. Merger or consolidation involving a foreign corporation licensed in the Philippines
- Section 133. Doing business without a license
- Section 134. Revocation of license
- Section 135. Issuance of certificate of revocation.
- Section 136. Withdrawal of foreign corporations
- TITLE XVI - MISCELLANEOUS PROVISIONS
- Section 137. Outstanding capital stock defined
- Section 138. Designation of governing boards
- Section 139. Incorporation and other fees.
- Section 140. Stock ownership in certain corporations
- Section 141. Annual report or corporations
- Section 142. Confidential nature of examination results.
- Section 143. Rule-making power of the Securities and Exchange Commission
- Section 144. Violations of the Code
- Section 145. Amendment or repeal
- Section 146. Repealing clause
- Section 147. Separability of provisions
- Section 148. Applicability to existing corporations
- Section 149. Effectivity.
BATAS PAMBANSA BLG. 68
THE CORPORATION CODE OF THE PHILIPPINES
TITLE I - GENERAL PROVISIONS DEFINITIONS AND CLASSIFICATIONS
Section 1. Title of the Code. - This Code shall be known as "The Corporation Code of the Philippines." (n)
Section 2. Corporation defined. - A corporation is an artificial being created by operation of law, having the right of succession and the powers, attributes and properties expressly authorized by law or incident to its existence. (2)
Section 3. Classes of corporations. - Corporations formed or organized under this Code may be stock or non-stock corporations. Corporations which have capital stock divided into shares and are authorized to distribute to the holders of such shares dividends or allotments of the surplus profits on the basis of the shares held are stock corporations. All other corporations are non-stock corporations. (3a)
Section 4. Corporations created by special laws or charters. - Corporations created by special laws or charters shall be governed primarily by the provisions of the special law or charter creating them or applicable to them, supplemented by the provisions of this Code, insofar as they are applicable. (n)
Section 5. Corporators and incorporators, stockholders and members. - Corporators are those who compose a corporation, whether as stockholders or as members. Incorporators are those stockholders or members mentioned in the articles of incorporation as originally forming and composing the corporation and who are signatories thereof.
Corporators in a stock corporation are called stockholders or shareholders. Corporators in a non-stock corporation are called members. (4a)
Section 6. Classification of shares. - The shares of stock of stock corporations may be divided into classes or series of shares, or both, any of which classes or series of shares may have such rights, privileges or restrictions as may be stated in the articles of incorporation: Provided, That no share may be deprived of voting rights except those classified and issued as "preferred" or "redeemable" shares, unless otherwise provided in this Code: Provided, further, That there shall always be a class or series of shares which have complete voting rights. Any or all of the shares or series of shares may have a par value or have no par value as may be provided for in the articles of incorporation: Provided, however, That banks, trust companies, insurance companies, public utilities, and building and loan associations shall not be permitted to issue no-par value shares of stock.
Preferred shares of stock issued by any corporation may be given preference in the distribution of the assets of the corporation in case of liquidation and in the distribution of dividends, or such other preferences as may be stated in the articles of incorporation which are not violative of the provisions of this Code: Provided, That preferred shares of stock may be issued only with a stated par value. The board of directors, where authorized in the articles of incorporation, may fix the terms and conditions of preferred shares of stock or any series thereof: Provided, That such terms and conditions shall be effective upon the filing of a certificate thereof with the Securities and Exchange Commission.
Shares of capital stock issued without par value shall be deemed fully paid and non-assessable and the holder of such shares shall not be liable to the corporation or to its creditors in respect thereto: Provided; That shares without par value may not be issued for a consideration less than the value of five (P5.00) pesos per share: Provided, further, That the entire consideration received by the corporation for its no-par value shares shall be treated as capital and shall not be available for distribution as dividends.
A corporation may, furthermore, classify its shares for the purpose of insuring compliance with constitutional or legal requirements.
Except as otherwise provided in the articles of incorporation and stated in the certificate of stock, each share shall be equal in all respects to every other share.
Where the articles of incorporation provide for non-voting shares in the cases allowed by this Code, the holders of such shares shall nevertheless be entitled to vote on the following matters:
1. Amendment of the articles of incorporation;
2. Adoption and amendment of by-laws;
3. Sale, lease, exchange, mortgage, pledge or other disposition of all or substantially all of the corporate property;
4. Incurring, creating or increasing bonded indebtedness;
5. Increase or decrease of capital stock;
6. Merger or consolidation of the corporation with another corporation or other corporations;
7. Investment of corporate funds in another corporation or business in accordance with this Code; and
8. Dissolution of the corporation.
Except as provided in the immediately preceding paragraph, the vote necessary to approve a particular corporate act as provided in this Code shall be deemed to refer only to stocks with voting rights. (5a)
Section 7. Founders' shares. - Founders' shares classified as such in the articles of incorporation may be given certain rights and privileges not enjoyed by the owners of other stocks, provided that where the exclusive right to vote and be voted for in the election of directors is granted, it must be for a limited period not to exceed five (5) years subject to the approval of the Securities and Exchange Commission. The five-year period shall commence from the date of the aforesaid approval by the Securities and Exchange Commission. (n)
Section 8. Redeemable shares. - Redeemable shares may be issued by the corporation when expressly so provided in the articles of incorporation. They may be purchased or taken up by the corporation upon the expiration of a fixed period, regardless of the existence of unrestricted retained earnings in the books of the corporation, and upon such other terms and conditions as may be stated in the articles of incorporation, which terms and conditions must also be stated in the certificate of stock representing said shares. (n)
Section 9. Treasury shares. - Treasury shares are shares of stock which have been issued and fully paid for, but subsequently reacquired by the issuing corporation by purchase, redemption, donation or through some other lawful means. Such shares may again be disposed of for a reasonable price fixed by the board of directors. (n)
TITLE II - INCORPORATION AND ORGANIZATION OF PRIVATE CORPORATIONS
Section 10. Number and qualifications of incorporators. - Any number of natural persons not less than five (5) but not more than fifteen (15), all of legal age and a majority of whom are residents of the Philippines, may form a private corporation for any lawful purpose or purposes. Each of the incorporators of s stock corporation must own or be a subscriber to at least one (1) share of the capital stock of the corporation. (6a)
Section 11. Corporate term. - A corporation shall exist for a period not exceeding fifty (50) years from the date of incorporation unless sooner dissolved or unless said period is extended. The corporate term as originally stated in the articles of incorporation may be extended for periods not exceeding fifty (50) years in any single instance by an amendment of the articles of incorporation, in accordance with this Code; Provided, That no extension can be made earlier than five (5) 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 Securities and Exchange Commission. (6)
Section 12. Minimum capital stock required of stock corporations. - Stock corporations incorporated under this Code shall not be required to have any minimum authorized capital stock except as otherwise specifically provided for by special law, and subject to the provisions of the following section.
Section 13. Amount of capital stock to be subscribed and paid for the purposes of incorporation. - At least twenty-five percent (25%) of the authorized capital stock as stated in the articles of incorporation must be subscribed at the time of incorporation, and at least twenty-five (25%) per cent of the total subscription must be paid upon subscription, the balance to be payable on a date or dates fixed in the contract of subscription without need of call, or in the absence of a fixed date or dates, upon call for payment by the board of directors: Provided, however, That in no case shall the paid-up capital be less than five Thousand (P5,000.00) pesos. (n)
Section 14. Contents of the articles of incorporation. - All corporations organized under this code shall file with the Securities and Exchange Commission articles of incorporation in any of the official languages duly signed and acknowledged by all of the incorporators, containing substantially the following matters, except as otherwise prescribed by this Code or by special law:
1. The name of the corporation;
2. The specific purpose or purposes for which the corporation is being incorporated. Where a corporation has more than one stated purpose, the articles of incorporation shall state which is the primary purpose and which is/are the secondary purpose or purposes: Provided, That a non-stock corporation may not include a purpose which would change or contradict its nature as such;
3. The place where the principal office of the corporation is to be located, which must be within the Philippines;
4. The term for which the corporation is to exist;
5. The names, nationalities and residences of the incorporators;
6. The number of directors or trustees, which shall not be less than five (5) nor more than fifteen (15);
7. The names, nationalities and residences of persons who shall act as directors or trustees until the first regular directors or trustees are duly elected and qualified in accordance with this Code;
8. If it be a stock corporation, the amount of its authorized capital stock in lawful money of the Philippines, the number of shares into which it is divided, and in case the share are par value shares, the par value of each, the names, nationalities and residences of the original subscribers, and the amount subscribed and paid by each on his subscription, and if some or all of the shares are without par value, such fact must be stated;
9. If it be a non-stock corporation, the amount of its capital, the names, nationalities and residences of the contributors and the amount contributed by each; and
10. Such other matters as are not inconsistent with law and which the incorporators may deem necessary and convenient.
The Securities and Exchange Commission shall not accept the articles of incorporation of any stock corporation unless accompanied by a sworn statement of the Treasurer elected by the subscribers showing that at least twenty-five (25%) percent of the authorized capital stock of the corporation has been subscribed, and at least twenty-five (25%) of the total subscription has been fully paid to him in actual cash and/or in property the fair valuation of which is equal to at least twenty-five (25%) percent of the said subscription, such paid-up capital being not less than five thousand (P5,000.00) pesos.
Section 15. Forms of Articles of Incorporation. - Unless otherwise prescribed by special law, articles of incorporation of all domestic corporations shall comply substantially with the following form:
ARTICLES OF INCORPORATION OF
__________________________
(Name of Corporation)
KNOW ALL MEN BY THESE PRESENTS:
The undersigned incorporators, all of legal age and a majority of whom are residents of the Philippines, have this day voluntarily agreed to form a (stock) (non-stock) corporation under the laws of the Republic of the Philippines;
AND WE HEREBY CERTIFY:
FIRST: That the name of said corporation shall be "_____________________, INC. or CORPORATION";
SECOND: That the purpose or purposes for which such corporation is incorporated are: (If there is more than one purpose, indicate primary and secondary purposes);
THIRD: That the principal office of the corporation is located in the City/Municipality of ________________________, Province of _______________________, Philippines;
FOURTH: That the term for which said corporation is to exist is _____________ years from and after the date of issuance of the certificate of incorporation;
FIFTH: That the names, nationalities and residences of the incorporators of the corporation are as follows:
NAME NATIONALITY RESIDENCE
___________________ ___________________ ___________________
___________________ ___________________ ___________________
___________________ ___________________ ___________________
___________________ ___________________ ___________________
___________________ ___________________ ___________________
SIXTH: That the number of directors or trustees of the corporation shall be _______; and the names, nationalities and residences of the first directors or trustees of the corporation are as follows:
NAME NATIONALITY RESIDENCE
___________________ ___________________ ___________________
___________________ ___________________ ___________________
___________________ ___________________ ___________________
___________________ ___________________ ___________________
___________________ ___________________ ___________________
SEVENTH: That the authorized capital stock of the corporation is ______________________ (P___________) PESOS in lawful money of the Philippines, divided into __________ shares with the par value of ____________________ (P_____________) Pesos per share.
(In case all the share are without par value):
That the capital stock of the corporation is ______________ shares without par value. (In case some shares have par value and some are without par value): That the capital stock of said corporation consists of _____________ shares of which ______________ shares are of the par value of _________________ (P____________) PESOS each, and of which _________________ shares are without par value.
EIGHTH: That at least twenty five (25%) per cent of the authorized capital stock above stated has been subscribed as follows:
Name of Subscriber Nationality No of Shares Amount
Subscribed Subscribed
_________________ __________ ____________ ____________
_________________ __________ ____________ ____________
_________________ __________ ____________ ____________
_________________ __________ ____________ ____________
_________________ __________ ____________ ____________
NINTH: That the above-named subscribers have paid at least twenty-five (25%) percent of the total subscription as follows:
Name of Subscriber Amount Subscribed Total Paid-In
_________________ ___________________ _______________
_________________ ___________________ _______________
_________________ ___________________ _______________
_________________ ___________________ _______________
_________________ ___________________ _______________
(Modify Nos. 8 and 9 if shares are with no par value. In case the corporation is non-stock, Nos. 7, 8 and 9 of the above articles may be modified accordingly, and it is sufficient if the articles state the amount of capital or money contributed or donated by specified persons, stating the names, nationalities and residences of the contributors or donors and the respective amount given by each.)
TENTH: That _____________________ has been elected by the subscribers as Treasurer of the Corporation to act as such until his successor is duly elected and qualified in accordance with the by-laws, and that as such Treasurer, he has been authorized to receive for and in the name and for the benefit of the corporation, all subscription (or fees) or contributions or donations paid or given by the subscribers or members.
ELEVENTH: (Corporations which will engage in any business or activity reserved for Filipino citizens shall provide the following):
"No transfer of stock or interest which shall reduce the ownership of Filipino citizens to less than the required percentage of the capital stock as provided by existing laws shall be allowed or permitted to be recorded in the proper books of the corporation and this restriction shall be indicated in all stock certificates issued by the corporation."
IN WITNESS WHEREOF, we have hereunto signed these Articles of Incorporation, this __________ day of ________________, 19 ______ in the City/Municipality of ____________________, Province of ________________________, Republic of the Philippines.
_______________________ _______________________
_______________________ _______________________
________________________________
(Names and signatures of the incorporators)
SIGNED IN THE PRESENCE OF:
_______________________ _______________________
(Notarial Acknowledgment)
TREASURER'S AFFIDAVIT
REPUBLIC OF THE PHILIPPINES )