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
What is the term of existence for corporations formed prior to the effectivity of this Code? Corporations with certificates of incorporation issued prior to the Revised Corporation Code’s effectivity, and which continue to exist, are granted perpetual existence by default (SEC. 11, Revised Corporation Code of the Philippines). These existing corporations are given a choice,
Describe the cumulative voting rights available to stockholders in stock corporations. In stock corporations, stockholders entitled to vote possess the right to vote the number of shares standing in their own names in the stock books at the time of the election (SEC. 23, Revised Corporation Code of the Philippines). They have three options for
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Under what conditions may a corporation whose term has expired apply for revival? A corporation whose specific term has expired may apply for the revival of its corporate existence, subject to fulfilling existing duties, debts, and liabilities prior to revival (SEC. 11, Revised Corporation Code of the Philippines). Upon the SEC’s approval, the corporation is
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Who are the mandatory officers required for a corporation, and what restrictions apply to holding multiple offices? Immediately after their election, the directors must formally organize and elect a president, who is required to be a director (SEC. 24, Revised Corporation Code of the Philippines). They must also elect a treasurer, who must be a
What is the requirement regarding minimum capital stock for stock corporations? Stock corporations are generally not required to have a minimum capital stock (SEC. 12, Revised Corporation Code of the Philippines). This provision liberalizes the capital requirements for most industries, making incorporation more accessible. However, this general rule has an explicit exception: a minimum capital
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What details regarding capital structure must a stock corporation’s Articles of Incorporation set forth? If the corporation is a stock corporation, its Articles of Incorporation must detail the amount of its authorized capital stock, the number of shares into which this capital stock is divided, and the par value of each share (SEC. 13, Revised
How must amendments to the Articles of Incorporation be indicated upon filing? Amendments to the articles of incorporation must be clearly indicated by underscoring the change or changes made to the text (SEC. 15, Revised Corporation Code of the Philippines). A copy of the amended articles must be submitted to the SEC, duly certified under
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