How is the due incorporation of a de facto corporation challenged? The due incorporation of any corporation claiming in good faith to be a de facto corporation and its right to exercise corporate powers shall not be inquired into collaterally in any private suit to which such corporation may be a party (SEC. 19, Revised […]
How is the due incorporation of a de facto corporation challenged? Read More »
What is the liability of persons who act as a corporation without proper authority? All persons who assume to act as a corporation knowing they lack the authority to do so shall be liable as general partners for any resulting debts, liabilities, and damages incurred (SEC. 20, Revised Corporation Code of the Philippines). This imposition
What is the liability of persons who act as a corporation without proper authority? Read More »
What are the consequences if a corporation fails to formally organize and commence business? If a corporation fails to formally organize and commence its business within five (5) years from the date of its incorporation, its certificate of incorporation is automatically deemed revoked (SEC. 21, Revised Corporation Code of the Philippines). This revocation takes effect
What procedure is followed if a corporation commences business but becomes continuously inoperative? If a corporation has commenced its business but subsequently becomes inoperative for a period of at least five (5) consecutive years, the SEC may place it under delinquent status after due notice and hearing (SEC. 21, Revised Corporation Code of the Philippines).
What are the fundamental roles and responsibilities of the board of directors or trustees? The board of directors or trustees is vested with the power to exercise the corporate powers, which are the fundamental legal capabilities of the entity (SEC. 22, Revised Corporation Code of the Philippines). The board is also responsible for conducting all
What are the term lengths and qualification requirements for directors and trustees? Directors in a stock corporation are elected for a fixed term of one (1) year and must be holders of stocks registered in the corporation’s books (SEC. 22, Revised Corporation Code of the Philippines). Trustees in a nonstock corporation are elected for a
What are the term lengths and qualification requirements for directors and trustees? Read More »
How are treasury shares defined, and how may they be subsequently disposed of? Treasury shares are defined as shares of stock that have been previously issued and fully paid for, but which the issuing corporation subsequently reacquires (SEC. 9, Revised Corporation Code of the Philippines). This reacquisition can occur through various lawful means, such as
How are treasury shares defined, and how may they be subsequently disposed of? Read More »
What is the role and required percentage of independent directors in corporations vested with public interest? Corporations deemed vested with public interest must have independent directors constituting at least twenty percent (20%) of their board (SEC. 22, Revised Corporation Code of the Philippines). An independent director is defined as a person who is free from
What are the requirements for natural persons organizing a corporation regarding their number and qualifications? A corporation may be organized by any person, partnership, association, or corporation, provided the total number of incorporators is not more than fifteen (15) (SEC. 10, Revised Corporation Code of the Philippines). If the incorporators are natural persons, they must
What percentage of stock or membership is required to constitute a quorum for the election of directors or trustees? For the election of directors or trustees, there must be present, either in person or through a written proxy, the owners of a majority of the outstanding capital stock (SEC. 23, Revised Corporation Code of the
