10 Things You Should Know To Successfully Set-Up a One Person Corporation in the Philippines
With the enactment of Republic Act No. 11232, otherwise known as the “Revised Corporation Code of the Philippines”, a single stockholder may form a One Person Corporation (“OPC”).
1) Who may form an OPC?
Only a natural person, trust, or an estate may form an OPC.
2) Who cannot form an OPC?
- Banks and quasi-banks
- Preneed companies
- Trust companies
- Insurance companies
- Public and publicly-listed companies
- Non-chartered government-owned and -controlled corporations
- A natural person who is licensed to exercise a profession (for the purpose of exercising such profession) except as otherwise provided under special law
3) What is the minimum authorized capital stock?
- No mininum requirement, except as otherwise provided by special law.
4) What positions may a single stockholder hold in the OPC?
- A single stockholder shall be the sole director and president of the OPC. He/she may likewise be appointed as the treasurer, provided that the treasurer provides a bond computed based on the amount of the authorized capital stock (SEC Memorandum Circular No. 7, Series of 2019).
A single stockholder may not be the corporate secretary.
5) How will the company’s affairs be managed in case of the death or incapacity of a single stockholder?
- The law requires a single stockholder to designate a nominee and an alternate nominee who shall, in the event of the single stockholder’s death or incapacity, take the place of the single stockholder as director and shall manage the corporation’s affairs. The nominee shall act as the director until the legal heirs of the single stockholder have been lawfully determined, and the heirs have designated one of them or have agreed that the estate shall be the single stockholder of the OPC. The alternate nominee shall step in as the director in case of the nominee’s inability, incapacity, death, or refusal to discharge the functions as director and manager of the corporation.
6) May an ordinary corporation be converted into an OPC, and vice-versa?
- Yes, subject to compliance with the application requirements with the Securities and Exchange Commission.
7) I am a foreign national. Am I allowed to form an OPC?
- Yes, subject to the applicable capital requirement and constitutional and statutory restrictions on foreign participation in certain investment areas and activities (SEC Memorandum Circular No. 7, Series of 2019).
8) What are the documentary requirements for an OPC?
- Cover Sheet
- Articles of Incorporation for One Person Corporation
- Written Consent from the Nominee and Alternate Nominee
- Other Requirements, if applicable:
* Proof of Authority to Act on Behalf of the Trust or Estate (for trusts and estates incorporating as OPC)
* Foreign Investments Act (FIA) Application Form (for foreign natural person)
* Affidavit of Undertaking to Change Company Name, in case not incorporated
* in the Articles of Incorporation
* Tax Identification Number (TIN) for Filipino single stockholder
* Tax Identification Number (TIN) or Passport Number for Foreign single stockholder
- Filing Fees. The filing fees include the Registration Fee, Legal Research Fee, Name Reservation Fee, Documentary Stamp Fee, and the FIA Fee (if applicable).
9) How do I proceed with the application?
- Apply for the reservation of the corporate name. To avoid the denial of your request, the OPC name must be distinct and not similar to another reserved or registered corporate name, and must not be contrary to law, public morals, good customs or public policy. “OPC” should be indicated at the end of the corporate name.
- Submit the duly accomplished Articles of Incorporation with attached written consent of the nominee and alternate nominee and other requirements required for registration, for pre-processing.
- Pay the Filing Fees.
- Submit the hard copies of the signed and notarized documents together with the proof of
- payment of filing fees at the SEC-CRMD Receiving Unit.
- The SEC will thereafter issue the Certificate of Registration as One Person Corporation.
10) Can I register the OPC online?
- Yes. On 08 April 2020, the SEC issued a notice providing for an interim Online Registration System for an OPC and corporations with two to four person incorporators. With the Online Registration System, an applicant or his duly authorized representative may input the proposed corporate name together with its trade name/s, if any, and the data to complete its corporate profile. The applicant must provide a valid and existing email account. The SEC User Guide may be accessed here: https://apps004.sec.gov.ph:8001/docs/UserGuide-InterimSystem.pdf
Register your OPC now. If you would like to discuss how we might assist you in accomplishing the requirements, you may schedule an appointment with @The Law Firm of Mallari Fiel Brillante Ronquillo thru firstname.lastname@example.org. Thank you.