The Mandatory Digital Transition: SEC Memorandum Circular No. 3, series of 2025 and the Implementation of SEC ZERO in Corporate Registration

 

The Securities and Exchange Commission (SEC) has promulgated a directive mandating the use of its digital system for corporate registration, aligning with the national policy to enhance government service delivery and eliminate red tape. This pivotal issuance, SEC Memorandum Circular (MC) No. 3, Series of 2025, requires the mandatory use of the SEC Zuper Easy Registration Online (ZERO) platform for the registration of corporations using the Electronic Simplified Processing of Application for Registration of Company (eSPARC) and One-day Submission and E-registration of Companies (OneSEC) portals.

 

The shift to the mandatory use of SEC ZERO is rooted in several foundational Philippine laws that promote governmental efficiency and the use of electronic documents.

The Commission’s efforts are primarily guided by the objectives of Republic Act (RA) No. 11032, otherwise known as the Ease of Doing Business and Efficient Government Service Delivery Act of 2018 (EDBA). The EDBA mandates that all government agencies automate business-related transactions by developing necessary software and technology-neutral platforms (Section 17, EDBA). Furthermore, the law explicitly requires the adoption of a zero-contact policy concerning applicants, unless strictly necessary for preliminary assessment and evaluation of requirements (Section 7, EDBA). The EDBA also necessitates that government agencies develop electronic versions of licenses, clearances, and permits with the same authority as signed hard copies, allowing applicants to print them conveniently (Section 9(e), EDBA).

Complementing the EDBA is Republic Act No. 8792, the Electronic Commerce Act (ECA). This Act provides that electronic signatures on electronic documents are equivalent to a signature on a written document if proved by a prescribed, unalterable procedure (Section 8, ECA). Additionally, the ECA prescribes that government agencies must accept the creation, filing, or retention of documents as electronic data messages or electronic documents, and issue permits and licenses in the same manner (Section 27(a) and (b), ECA).

The SEC’s authority to implement such systems also stems directly from its charter, the Revised Corporation Code of the Philippines (RCC). The RCC grants the Commission supervision and jurisdiction over all corporations (Section 179(a), RCC). Crucially, the RCC mandates that the Commission shall develop and implement an electronic filing and monitoring system, and promulgate rules to facilitate and expedite corporate registration and submission of required documents (Section 180, RCC). The SEC also holds the power and authority to formulate and enforce standards, guidelines, policies, rules, and regulations necessary to carry out the provisions of the Code (Section 179(o) and (p), RCC).

The SEC ZERO Framework: Integration of Digital Platforms

 

The SEC Zuper Easy Registration Online (ZERO) is an application within the Electronic Simplified Processing of Application for Registration of Company (eSPARC) system. It represents a key digital innovation adopted by the Commission to streamline processes and strengthen its mandate delivery.

SEC ZERO is designed to seamlessly integrate with two other crucial SEC platforms: the Electronic SEC Universal Registration Environment (eSECURE) and the Electronic Submission Authentication Portal (eSAP) (Section 1(g), SEC MC No. 3, s. of 2025).

• Electronic Simplified Processing of Application for Registration of Company (eSPARC): This online facility caters to applications for the registration of domestic corporations (stock and non-stock), partnerships, and foreign corporations, serving as the main system where applications are submitted and details of the articles of incorporation are inputted (Section 1(c), SEC MC No. 3, s. of 2025).
• One-day Submission and E-registration of Companies (OneSEC): This is a sub-system of eSPARC aimed at providing one-day approval for registration applications of Domestic Stock Corporations, including One Person Corporations (OPC) or regular corporations with two to fifteen incorporators (Section 1(f), SEC MC No. 3, s. of 2025).
• Electronic SEC Universal Registration Environment (eSECURE): This platform creates a digital passport for individuals, requiring a repeatable Electronic Know Your Customer (eKYC) process to determine identity authenticity and reachability for online transactions (Section 1(d), SEC MC No. 3, s. of 2025).
• Electronic Submission Authentication Portal (eSAP): This critical online service is designed to digitally authenticate SEC documents like the Articles of Incorporation, By-Laws, and Cover Sheet, eliminating the requirement for wet signatures, notarization, and hard copy submissions (Section 1(b), SEC MC No. 3, s. of 2025). Authentication is achieved using One Time Passwords (OTPs) instead of conventional paper-based signatures (Section 1(b), SEC MC No. 3, s. of 2025).

Through SEC ZERO, the process is transformed into a complete, end-to-end, paperless registration (Section 1(g), SEC MC No. 3, s. of 2025). Once completed, the digitally authenticated certificate of incorporation is automatically generated by the system and carries the same validity as an original certificate (Section 1(g), SEC MC No. 3, s. of 2025).

 

Mandatory Use and Coverage Stipulated in SEC MC No. 3, S. of 2025

SEC MC No. 3, S. of 2025 establishes that a user must register a new corporation through eSPARC and OneSEC using SEC ZERO as the only mode of processing (Section 2.1, SEC MC No. 3, s. of 2025).

 

A. Scope of Immediate Mandatory Use

Upon the circular’s effectivity, the mandatory use of SEC ZERO applies specifically to Domestic Stock Corporations (Section 3.1, SEC MC No. 3, s. of 2025). These include:

1. One Person Corporations (OPC).
2. Regular corporations with two to fifteen incorporators.
3. All Filipino or corporations with foreign equity processed through REGULAR with ZERO Processing (Section 3.1, SEC MC No. 3, s. of 2025).
4. All Filipino Domestic Stock Corporations processed through OneSEC with ZERO Processing (Section 3.1, SEC MC No. 3, s. of 2025).

The immediate mandatory use initially exempts certain entities, specifically Lending Companies and Financing Companies, which must use the Regular Only mode of processing.

B. Expanded Coverage

The mandatory use of SEC ZERO is set to expand to other types of corporations—including those initially exempt, such as lending companies, financing companies, and foreign corporations—three (3) months after the circular’s effectivity (Section 3.2, SEC MC No. 3, s. of 2025).

Procedural Requirements for Digital Authentication

 

For an applicant to successfully utilize SEC ZERO, specific digital prerequisites must be met by all signatories:

1. Creation of Credentialed eSECURE Account: To access and facilitate the registration using SEC ZERO, the user must create a credentialed eSECURE account for all incorporators or signatories of the proposed corporation (Section 2.2, SEC MC No. 3, s. of 2025). This is necessary to determine authenticity of identity (Section 1(d), SEC MC No. 3, s. of 2025).
2. Authentication via eSAP: Signatures are authenticated digitally through the eSAP, which is integrated into the eSPARC and OneSEC ZERO processing (Section 2.3, SEC MC No. 3, s. of 2025). When documents are ready for signing, corporate officers receive an email notification containing the eSAP link. They log in using their eSECURE credentials and authenticate the documents by verifying a One Time Password (OTP) sent to their registered mobile number and email address. This OTP verification replaces the need for physical signing and notarization.

Once all required steps, including name verification, data encoding, digital authentication, and online payment through eSPAYSEC, are successfully completed, the system automatically generates the digital certificate of incorporation (Section 1(g), SEC MC No. 3, s. of 2025).

SEC Memorandum Circular No. 3, S. of 2025, represents a significant step towards fully digitalizing corporate registration in the Philippines, consistent with the legislative goals outlined in the Ease of Doing Business Act and the Revised Corporation Code. By mandating the use of SEC ZERO, which utilizes the integrated platforms of eSPARC, OneSEC, eSECURE, and eSAP, the Commission facilitates a mandatory end-to-end, paperless process that eliminates physical signing, notarization, and hard copy submission (Section 1(g), SEC MC No. 3, s. of 2025). This mandatory digital implementation aims to provide a faster, more efficient, and location-independent registration experience for domestic corporations (Section 2.1, SEC MC No. 3, s. of 2025).

The implementation of SEC ZERO serves as a powerful example of governmental adherence to the zero-contact policy (Section 7, EDBA). The system acts much like a digital vault and notary office combined: applicants submit their forms to the digital vault (eSPARC/OneSEC), while the signatories use their secure digital keys (eSECURE/eSAP OTPs) to authenticate and notarize the contents, ensuring that the final output—the Certificate of Incorporation—is immediately available and legally valid.

About Nicolas and De Vega Law Offices

Nicolas and de Vega Law Offices is a full-service law firm in the Philippines.  You may visit us at the 16th Flr., Suite 1607 AIC Burgundy Empire Tower, ADB Ave., Ortigas Center, 1605 Pasig City, Metro Manila, Philippines.  You may also call us at +632 84706126, +632 84706130, +632 84016392 or e-mail us at [email protected]. Visit our website https://ndvlaw.com.