At long last, amendments to the Corporation Code of the Philippines through Republic Act No. 11232 has finally arrived!\u00a0\u00a0 The Law has been signed last February 20, 2019.<\/p>\n
The Amendments primarily are made to make the Corporation Code attuned with the business climate of the present, with strong changes to make it relevant for the next decades into the future.\u00a0 The previous law was put in operation about 4 decades ago or a long 38 years ago.\u00a0 It is just right that the law has to be amended to become responsive and relevant with the changing of the times and to attract more foreign investors.<\/p>\n
Here are the some of the changes in the Amended Corporation Code of the Philippines<\/p>\n
1. Title II Section 11 \u2013 Corporate Term<\/strong><\/p>\n A Corporation shall have perpetual existence unless its articles of incorporation provides otherwise.<\/p>\n Corporations with certificates of incorporation issued prior to the effectivity of this Code, and which continue to exist, shall have perpetual existence, unless the corporation, upon a vote of its stockholders representing a majority of its outstanding capital stock, notified the Commission that it elects to retain its specific corporate term pursuant to its articles of incorporation: Provided,<\/em> That any change in the corporate term under this section is without prejudice to the appraisal right of dissenting stockholders in accordance with the\u00a0 provisions of this Code.<\/p>\n 2. Title II Section 12 \u2013 Minimum Capital Stock Not Required of the Stock Corporation<\/strong><\/p>\n Stock corporations shall not be required to have a minimum capital stock, except as otherwise specifically provided by special law.<\/p>\n 3. Title II Section 21 \u2013 Effects of the Non-Use of Corporate Charter and Continuous In operation.<\/strong><\/p>\n If a Corporation does not formally organize and commence its business within five (5) years from the date of its incorporation, its certificate of incorporation shall be deemed revoked as of the day following the end of the five (5) year period.<\/p>\n However, if a corporation has commenced its business but subsequently becomes inoperative for a period of at least five (5) consecutive years, the Commission may, after due notice and hearing, place the corporation under delinquent status.<\/p>\n A delinquent corporation shall have a period of two (2) years to resume operations and comply with all requirements that the Commission shall prescribe.\u00a0 Upon compliance by the corporation, the Commission shall issue an order lifting the delinquent status. Failure to comply with the requirements and resume operations within the period give by the Commission shall cause the revocation of the corporation\u2019s<\/em> certificate of incorporation.<\/p>\n 4. Title VI MEETINGS<\/strong><\/p>\n Section 52 Regular and Special Meetings of Directors or Trustees; Quorum <\/strong>Paragraph 4 & 5<\/strong><\/p>\n Meetings of directors or trustees of corporations may be held anywhere in or outside of the Philippines, unless the bylaws provide otherwise.\u00a0 Notice of regular or special meetings stating the date, time and place of the meeting must be sent to every director or trustee at least two (2) days prior to the scheduled meeting, unless longer time is provided in the bylaws.\u00a0 A director or trustee may waive this requirement, either expressly or impliedly.<\/p>\n Directors or trustees who cannot physically attend or vote at board meetings can participate and vote through remote communication such as videoconferencing, teleconferencing, or other alternative modes of communication that allow them reasonable opportunities to participate.\u00a0 Directors or trustees cannot attend or vote by proxy at the board meetings.<\/p>\n 5. Title VI Meetings <\/strong><\/p>\n Section 57 Manner of Voting; Proxies <\/strong><\/p>\n Stockholders and members may vote in person or by proxy in all meetings of stockholders or members.<\/p>\n When so authorized in the bylaws or a by a majority of the board of directors, the stockholders or members of corporations may also vote through remote communication or in absentia:\u00a0 Provided, That the votes are received before the corporation finishes the tally of votes.<\/p>\n A stockholder or member who participates through remote communication or in absentia shall be deemed present for purposes of quorum.<\/p>\n 6. Title XIII<\/strong><\/p>\n Chapter III One Person Corporations<\/strong><\/p>\n Section 115 Applicability of Provisions to One Person Corporations<\/strong><\/p>\n The provisions of this Title shall primarily apply to One Person Corporations.\u00a0 Other provisions of this Code apply suppletorily, except as otherwise provided in this Title.<\/p>\n Section 116 One Person Corporation<\/strong><\/p>\n A One Person Corporation is a corporation with a single stockholder: Provided<\/em>, That only a natural person, trust, or an estate may form a One Person Corporation.<\/p>\n Banks and quasi-banks, preneed, trust, insurance, public and publicly-listed companies, and non-chartered government-owned and controlled corporations may not incorporate as One Person Corporations: Provided, further, <\/em>That a natural person who is a licensed to exercise a profession may not organize as a One Person Corporation for the purpose of exercising such profession except as otherwise provided under special laws.<\/p>\n Section 117 Minimum Capital Stock Not Required for One Person Corporation<\/strong><\/p>\n A One Person Corporation shall not be required to have a minimum authorized capital stock except as otherwise provided by special law.<\/p>\n Section 131 Conversion from an Ordinary Corporation to a One Person <\/strong>Corporation<\/strong>.<\/p>\n When a single stockholder acquires all the stocks of an ordinary stock corporation, the latter may apply for conversion into a One Person Corporation, subject to the submission of such documents as the Commission may require.\u00a0 If the application for conversion is approved, the Commission shall issue a certificate of filing of amended articles of incorporation reflecting the conversion.\u00a0 The One Person Corporation converted from an ordinary stock corporation shall succeed the latter and be legally responsible for all the latter\u2019s outstanding liabilities as of the date of conversion.<\/p>\n With these changes, the government is looking forward to a more positive business environment supported by responsive laws to address much needed reforms and hopefully be at par with the rest in the ASEAN region.<\/p>\n