Starting Monday, May 6, the Securities and Exchange Commission (SEC) will start accepting the registration of one-person corporations (OPC) at its head office in Pasay City. The move comes less than three months after the Republic Act 11232 or the revised corporation code was signed into law.
The newly passed measure lightens the business registration process, especially for small firms, and updates the Corporation Code that was untouched for almost 40 years.
“The concept of a one-person corporation (OPC), along with the other provisions of the Revised Corporation Code of the Philippines, makes doing business in the country easier,” SEC Chairperson Emilio Aquino said in a statement. “An OPC offers the agility and complete dominion of a sole proprietorship and the limited liability of a corporation. We encourage everyone to take advantage of this provision to pursue their entrepreneurial aspirations.”
How to Register as a One-Person Corporation
Before registering as an OPC, interested applicants must first qualify under certain guidelines. This includes the basics, like the single stockholder of the OPC can be a person, trust or estate, and that the incorporator must be of legal age.
A foreigner may also register as an OPC, but the business he or she may register is “subject to the applicable constitutional and statutory restrictions.” For example, under the constitution, a business that is for a public utility must be 60-percent owned by a Filipino.
However, professionals, licensed or not, may not register as an OPC if he or she is doing business to apply the said profession “unless provided under special laws.”
If the applicant passes all the qualifications, he or she may proceed with the registration process.
First off, the applicant is required to check if the company name he or she wishes to register is still available at the SEC office at the Philippine International Convention Center in Pasay City. Note that lines can be long so better be early. If the unfortunate happens and the company name is already taken, the applicant may file for an appeal (which may take days).
Once the company name is settled, the applicant then submits all other requirements needed. The SEC requires a cover sheet and articles of incorporation, which discusses the company’s “primary purpose, principal office address, term of existence, names and details of the single stockholder, and the authorized, subscribed and paid-up capital.”
The applicant must also show written consent of the nominee and alternate nominee or the assigned person who will take on the roles left by the incorporator in case of death, and other applicable requirements for pre-processing. Make sure all documents are notarized for seamless processing.
The applicant will then pay the necessary fees: filing fee, name reservation fee, and legal research fee. While these fees may be minimal, a surety bond is demanded from an applicant who wishes to also serve as the OPC’s Treasurer.
Under section 10 of the OPC’s registration guidelines, the surety bond will be computed based on the authorized capital stock of the OPC. The value varies from a million pesos to as much as P5 million. The bond is also subject to renewal every two years, and is a “continuing requirement” as long as the single stockholder is the OPC’s treasurer.
With all those fees paid, the applicant will then submit all of his or her requirements to the SEC Company Registration and Monitoring Department (CRMD). Do note however, that the processing of the application may take days as the entire process is still manually done at the office of the SEC. Once this step is cleared, a certificate of registration as OPC will be released to the applicant.
Note that within 15 days from the issuance of the Certificate of the Incorporation, the single stockholder must appoint the firm’s treasurer, corporate secretary and other officers, and he or she must notify the SEC within five days after the appointment was made.
It may not be as tedious as registering as a partnership or a full-fledged corporation, but it sure does still demand a lot of work from entrepreneurs.
This story originally appeared on Esquiremag.ph.
* Minor edits have been made by the Entrepreneur.com.ph editors.