TITLE I - GENERAL PROVISIONS

DEFINITIONS AND CLASSIFICATIONS

The shares in stock corporations may be divided
Section 1. Title of the Code. - This Code shall into classes or series of shares, or both. No
be known as the "Revised Corporation Code". share may be deprived of voting rights except
Section 2. Corporation Defined. - A those classified and issued as "preferred" or
corporation is an artificial being created by "redeemable" shares, unless otherwise provided
operation of law, having the right of succession in this Code: Provided, That there shall always
and the powers, attributes and properties be a class or series of shares with complete
expressly authorized by law or incidental to its voting rights.
existence.
Section 3. Classes of Corporations. - Holders of non-voting shares shall nevertheless
Corporations formed or organized under this be entitled to vote on the following matters:
Code may be stock or nonstock corporations. • (a) Amendment of the articles of incorporation;
Stock corporations are those which have for • (b) Adoption and amendment of bylaws;
capital stock divided into shares and are • (c) Sale, lease, exchange, mortgage, pledge,
authorized to distribute to the holders of such or other disposition of all or substantially all of
shares, dividends, or allotments of the surplus the corporate property;
profits on the basis of shares held. All other • (d) Incurring, creating, or increasing bonded
corporations are nonstock corporations. indebtedness;
Section 4. Corporations created by Special • (e) Increase or decrease of authorized capital
Laws or Charters. - Corporations created by stock;
special laws or charters shall be governed • f) Merger or consolidation of the corporation
primarily by the provisions of the special law or with another corporation or other corporations;
charter creating them or applicable to them, • (g) Investment of corporate funds in another
supplemented by the provisions of this Code, corporation or in business in accordance with
insofar as they are applicable. this Code; and,
Section 5. Corporators and Incorporators, • (h) Dissolution of the corporation.
Stockholders and Members. - Corporators are
Except as provided in the immediately preceding
those who compose a corporation, whether as
paragraph, the vote required under this Code to
stockholders or shareholders in a stock approve a particular corporate act shall be
corporation or as members in a nonstock deemed to refer only to stocks with voting rights.
corporation. Incorporators are those
stockholders or members mentioned in the The shares or series of shares may or may not
articles of incorporation as originally forming and have a par value: Provided, That banks, trust,
insurance, and preneed companies, public
composing the corporation and who are
utilities, building and loan associations, and
signatories thereof. other corporations authorized to obtain or
Section 6. Classification of shares. - The access funds from the public, whether publicly
classification of shares, their corresponding listed or not, shall not be permitted to issue
rights, privileges, or restrictions, and their stated no-par value shares of stock.
par value, if any, must be indicated in the articles
of incorporation. Each share shall be equal in all Preferred shares of stock issued by a
respects to every other corporation may be given preference in the
share, except as otherwise provided in the
distribution of dividends a d in the distribution of
articles of incorporation and in the certificate of
stock. corporate assets in case of liquidation, or such
other preferences: Provided, That preferred such shares upon the expiration of a fixed
shares may be issued only with a stated par period, regardless of the existence of
value. The board of directors, where authorized unrestricted retained earnings in the books of
the corporation, and upon such other terms and
in the articles of incorporation, may fix the terms
conditions stated representing the shares,
and conditions of preferred shares of stock or subject to rules and regulations issued by the
any series thereof: Provided, further, That such Commission.
terms and conditions shall be effective upon
filing of a certificate thereof with the Securities Section 9. Treasury shares. - Treasury shares
and Exchange Commission, hereinafter referred are shares of stock which have been issued and
to as "Commission". fully paid for, but subsequently reacquired by the
issuing corporation through purchase,
Shares of capital stock issued without par value redemption, donation, or some other lawful
shall be deemed fully paid and nonassessable means, Such shares may again be disposed of
and the holder of such shares shall not be liable for a reasonable price fixed for by the board of
to the corporation or to its creditors in respect directors.
thereto: Provided, That no-par value shares
must be issued for a consideration of at least
Five pesos (P5.00) per share: Provided, further,
That the entire consideration received by the TITLE I - INCORPORATION AND
corporation for its no-par value shares shall be ORGANIZATION OF PRIVATE
treated as capital and shall not be available for CORPORATIONS
distribution as dividends.
Section 10. Number and Qualifications of
A corporation may further classify its shares for Incorporators. Any person, partnership,
the purpose of ensuring compliance with association or corporation, singly or jointly with
constitutional or legal requirements. others but not more than fifteen (15) in number,
may organize a corporation for any lawful
Section 7. Founder's Shares. - Founder's purpose or purposes; Provided, That natural
shares may be given certain rights and persons who are licensed to practice a
privileges not enjoyed by the owners of other profession, and partnerships or associations
stocks. Where the exclusive right to vote and be organized for the purpose of practicing a
voted for in the election of directors is granted, it profession, shall not be allowed to organize as a
must be for a limited period not to exceed five corporation unless otherwise provided under
(5) years from the date of incorporation: special laws.
Provided, That such exclusive right shall not be Incorporators who are natural persons must be
allowed if its exercise will violate Commonwealth of legal age.
Act No. 108, otherwise known as the
"Anti-Dummy Law"; Republic Act No. 7042, Each incorporator of stock corporation must own
otherwise known as the "Foreign Investments or be a subscriber to at least one (1) share of
Act of 1991", and other pertinent laws. the capital stock.

Section 8. Redeemable Shares. - Redeemable A corporation with a single stockholder is

shares may be issued by the corporation when considered a One Person Corporation as
expressly provided in the articles of described in Title XIII, Chapter Ill of this Code.
incorporation. They are shares which may be
purchased by the corporation from the holders of
Section 11. Corporate Term. - A corporation be approved by the Commission unless
shall have perpetual existence unless its articles accompanied by a favorable recommendation of
of incorporation provide otherwise. the appropriate government agency.
Corporations with certificates of incorporation
Section 12. Minimum Capital Stock Not
issued prior to the effectivity of this Code, and
Required of Stock Corporations. - Stock
which continue to exist, shall have perpetual
corporations shall not be required to have a
existence, unless the corporation, upon a vote of minimum capital stock, except as otherwise
its stockholders representing a majority of its specifically provided by special law.
outstanding capital stock, notifies the
Commission that it elects to retain its specific Section 13. Contents of the Articles of
corporate term pursuant to its articles of Incorporation. - All corporations shall file with
the Commission articles of incorporation in any
incorporation: Provided, That any change in the
of the official languages, duly signed and
corporate term under this section is without acknowledged or authenticated, in such form
prejudice to the appraisal right of dissenting and manner as may be allowed by the
stockholders in accordance with the provisions Commission, containing substantially the
of this Code. following matters, except as otherwise
prescribed by this Code or by special law:
A corporate term for a specific period may be
extended or shortened by amending the articles
• (a) The name of the Corporation;
of incorporation: Provided, That no extension
• (b) The specific purpose or purposes for which
may be made earlier than three (3) years prior to
the corporation is being formed. Where a
the original or subsequent expiry date(s) unless
corporation has more than one stated purpose,
there are justifiable reasons for an earlier
the articles of incorporation shall indicate the
extension as may be determined by the
primary purpose and the secondary purpose or
Commission: Provided, further, That such
purposes:
extension of the corporate term shall take effect
Provided, That a nonstock corporation may not
only on the day following the original or
include a purpose which would change or
subsequent expiry date(s).
contradict its nature as such;
• (c) The place where the principal office of the
A corporation whose term has expired may
corporation is to be located, which must be
apply for a revival of its corporate existence,
within the Philippines;
together with all the rights and privileges under
• (d) The term for which the corporation is to
its certificate of incorporation and subject to all
exist, if the corporation has not elected perpetual
of its duties, debts and liabilities existing prior to
existence;
its revival. Upon approval by the Commission,
• (e) The names, nationalities, and residence
the corporation shall be deemed revived and a
addresses of the incorporators;
certificate of revival of corporate existence shall
be issued, giving it perpetual existence, unless • (f) The number of directors, which shall not be
its application for revival provides otherwise. more than fifteen (15) or the number of trustees
which may be more than fifteen (15):
No application for revival of certificate of
• (g) The names, nationalities, and residence
incorporation of banks, banking and
addresses of persons who will act as directors or
quasi-banking institutions, preneed, insurance
trustees until the first regular directors or
and trust companies, non-stock savings and
trustees are duly elected and qualified in
loan associations (NSSLAS), pawnshops,
accordance with this Code;
corporations engaged in money service
• (h) If it be a stock corporation, the amount of its
business, and other financial intermediaries shall
authorized capital stock, number of shares into
which it is divided, the par value of each, names, Fourth: That the corporation shall have a
nationalities, and residence address of the perpetual existence or a term of ______
original subscribers, amount subscribed and certificate of incorporation;
paid by each on the subscription, and a years from the date of issuance of the
statement that some or all of the shares are Fifth: That the names, nationalities, and
without par value, if applicable; residence addresses of the incorporators of the
• (i) If it be a nonstock corporation, the amount of corporation are as follows:
its capital, the names, nationalities, and Name Nationality Residence
residence addresses of the contributors, and _____ ________ __________
amount contributed by each; and, Sixth: That the number of directors or trustees
•(j) Such other matters consistent with law and of the corporation shall be _____ and the
which incorporators may deem necessary and names, nationalities, and residence addresses
convenient. of the first directors or trustees of the corporation
An arbitration agreement may be provided in the are as follows:
articles of incorporation pursuant to Section 181 Name Nationality Residence
of this Code. _______ __________ ___________
The articles of incorporation and applications for Seventh: That the authorized capital stock of
amendments thereto may be filed with the the corporation is
Commission in the form of an electronic PESOS (P_____), divided into shares with the
document, in accordance with the Commission's par value of corporation is ____PESOS (P____)
rules and regulations on electronic filing. per share. (In case all the shares are without par
value): That the capital stock of the corporation
Section 14. Form of Articles of Incorporation. is ______ shares without par value.
(In case some shares have par value and some
- Unless otherwise prescribed by special law, the
are without par value): That the capital stock of
articles of incorporation of all domestic
said corporation consists of _____ shares, of
corporations shall comply substantially with the which_____ shares have a par value of
following form: PESOS (P______ ) each, and of which
shares are without par value.
Articles of Incorporation Eight: That the number of shares of the
Of authorized capital stock above-stated has been
__________________ subscribed as follows:
(Name of Corporation)
The undersigned incorporators, all of age, have
voluntary agreed to form a (stock) (nonstock)
corporation under the laws of the Republic of the Name Nation No. of Amount Amount
Philippines and certify the following: of ality subscri Subscribe
Paid
subscri bed d
First: That the name of the corporation shall be ber shares
"
_________, Inc., Corporation or OPC";
Second: That the purpose or purposes for
which such corporation is incorporated are: (If
there is more than one purpose, indicate primary
(Modify No. 8 if shares are with no-par value. In
and secondary purposes);
Third: That the principal office of the corporation case the corporation is nonstock, Nos. 7 and 8
is located in the City/Municipality of _________ of the above articles may be modified
Province of ________Philippines; accordingly, and it is sufficient if the articles state
the amount of capital or money contributed or (Name and signature of the Incorporators)
donated by specified persons, stating the Start chat
names, nationalities, and residence address of (Name and signature of Treasurer)
the contributors or donors and the respective
amount given by each)
Ninth: That______has been elected by the Section 15. Amendment of Articles of
subscriber as Treasurer of the Corporation to act Incorporation. - Unless otherwise prescribed by
as such until after the this Code or by special law, and for legitimate
successor is elected and qualified in accordance purposes, any provision or matter stated in the
with the bylaws, that as Treasurer, authority has articles of incorporation may be amended by a
been given to receive in the name and for the majority vote of the board of directors or trustees
benefit of the corporation, all subscriptions, and the vote or written assent of the
contributions or donations paid or given by the stockholders representing at least two-thirds
subscribers or members, who certifies that (2/3) of the outstanding capital stock, without
information set forth in the seventh and eight prejudice to the appraisal right of dissenting
clauses above, and that the paid-up portion of stockholders in accordance with the provisions
the subscription in case and/or property for the of this Code. The articles of incorporation of a
benefit and credit of the corporation has been nonstock corporation may be amended by the
duly received. vote or written assent of the majority of trustees
and at least two-thirds (2/3) of the members.
Tenth: That the incorporators undertake to
change the name of the corporation immediately The original and amended articles together shall
upon receipt of notice from the Commission that contain all provisions required by law to set out
another corporation, partnership or person has in the articles of incorporation.
acquired a prior right to the use of such name, Amendments to the articles shall be indicated by
that the name has been declared not underscoring the change or changes made, and
distinguishable from a name already registered a copy thereof duly certified under oath by the
or reserved for the use of another corporation, or corporate secretary and majority of the directors
that it is contrary to law, public morals, and food or trustees, with a statement that the
customs or public policy. amendment have been duly approved by the
required vote of the stockholders or members
Eleventh: (Corporation which will engage in any shall be submitted to the Commission.
business or activity reserved for Filipino citizens
shall provide the following): The amendment shall take effect upon their
"No transfer of stock or interest which shall approval by the Commission or from the date of
reduce the ownership of Filipino citizens to less filing with the said Commission if not acted upon
that the required percentage of capital stock as within six (6) months from the date of filing for a
provided by existing laws shall be allowed or cause not attributable to the corporation.
permitted to be recorded in the proper books of
the corporation, and this restriction shall be Section 16. Grounds When Articles of
indicated in all stock certificates issued by the Incorporation or Amendment May be
corporation." Disapproved. - The Commission may
IN WITNESS THEREOF, we have hereunto disapprove articles of incorporation or any
signed these Articles of Incorporation, this ___ amendment thereto if the same is not compliant
day of ___, 20__ in the city/municipality of with the requirements of this Code:
_______, province of _____ republic of the Provided, That the Commission shall give the
philippines incorporators, directors, trustees, or officers a
reasonable time from receipt of the disapproval name already reserved or registered for use of
within which to modify the objectionable portions another corporation; (2) already protected by
of the articles or amendment. The following are law; or (3) contrary to law, rules and regulations
the grounds for such disapproval: may summarily order the corporation for
• (a) The articles of incorporation or any immediately cease and desist from using such
amendment thereto is not substantially in name and require the corporation to register
accordance with the form prescribed herein; new one, The Commission shall also cause the
• (b) The purpose or purposes of the corporation removal of all visible signages, marks,
are patently unconstitutional, illegal, immoral or advertisements, labels, prints, and other effects
contrary to government rules and regulations; bearing such corporate name. Upon the
• (c) The certification concerning the amount of approval of the new corporate name, the
capital stock subscribed and/or paid is false; Commission shall issue a certificate of
and, incorporation
• (d) The required percentage of Filipino under the amended name.
ownership of the capital stock under existing
laws or the Constitution has not been complied If the corporation fails to comply with the
with law Commission's order, the Commission may hold
No articles of incorporation or amendment to the corporation and its responsible directors or
officers in contempt and/or hold them
articles of incorporation of banks, banking and
administratively, civilly and/or criminally liable
quasi-banking institutions, preneed, insurance
under this Code and other
and trust companies, NSSLAs, pawnshops, and
applicable laws and/or revoke the registration of
other financial intermediaries shall be approved
the corporation.
by the Commission unless accompanied by a
favorable recommendation of the appropriate
Section 18. Registration, Incorporation and
government agency the effect that such articles
Commencement of Corporate Existence. - A
or amendment is in accordance with law. person or group of persons desiring to
incorporate shall submit the intended corporate
Section 17. Corporate Name. - No corporate name to the Commission for verification. If the
name shall be allowed by the Commission if it is Commission finds that the name is
not distinguishable from that already reserved or distinguishable from a name already reserved or
registered for the use of another corporation, or registered for use of another corporation, not
if such name is already protected by law, or protected by law and is not contrary to law, rules
when its use is and regulations, the name shall be reserved in
contrary to existing law, rules and regulations. favor of the incorporators. The incorporators
shall then submit their articles of incorporation
A name is not distinguishable even if it contains and bylaws to the Commission.
one or more of the following:
If the Commission finds that the submitted
• (a) The word "corporation", "company", documents and information are fully compliant
"incorporated", "limited", "limited liability", or an with the requirements in this Code, other
abbreviation of one of such words; and, relevant laws, rules and regulations, the
• (b) Punctuations, articles, conjunctions, Commission shall issue the certificate of
different tenses, spacing, or number of the same incorporation.
word or phrase.
A private corporation organized under theis
The Commission, upon determination that the Code commences its corporate existence and
corporate name is: (1) not distinguishable from a juridical personality from the date the
Commission issues the certificate of consecutive years, the Commission may, after
incorporation under its official seal and due notice and hearing, place the corporation
thereupon the incorporators, under delinquent status.
stockholders/members and their successors
shall constitute a body corporate under the A delinquent corporation shall have a period of
name stated in the articles of incorporation for two (2) years to resume operations and comply
the period of time mentioned therein, unless said with all requirements that the Commission shall
period is extended or the corporation is sooner prescribe. Upon compliance by the corporation,
dissolved in accordance with law. the Commission shall issue an order lifting
delinquent status.
Section 19. De facto Corporations. - The due Failure to comply with the requirements and
incorporation of any corporation claiming in good resume operations within the period given by the
faith to be a corporation under this Code, and its Commission shall cause the revocation of the
right to exercise corporate powers, shall not be corporation's certificate of incorporation.
inquired collaterally in any private suit to which
such corporation may be a party. Such inquiry The Commission shall give reasonable notice to,
may be made by the Solicitor General in a quo
and coordinate with the appropriate regulatory
warranto proceeding.
agency prior to the suspension or revocation of
Section 20. Corporation by Estoppel. - All the certificate of incorporation of companies
persons who appear to act as a corporation under their special regulatory jurisdiction.
knowing it to be without authority to do so shall
be liable as general partners for all debts,
liabilities and damages incurred or arising as a
result thereof. Provided, however, That when TITLE III - BOARD OF DIRECTORS/
any such ostensible corporation is sued on any TRUSTEES AND OFFICERS
transaction entered by it as a corporation or on Section 22. The Board of Directors or
any tort committed by it as such, it shall not be Trustees of a Corporation; Qualification and
allowed to use its lack of corporate personality Term. - Unless otherwise provided in this Code,
as a defense. Anyone who assumes an the board of directors or trustees shall exercise
obligation to an ostensible corporation as such the corporate powers, conduct all business, and
cannot resist performance thereof on the ground control all properties of the corporation.
that there was in fact no corporation.
Directors shall be elected for a term of one (1)
year from among the holders of stocks
Section 21. Effects of Non-Use of Corporate registered in the corporation's books while
Charter and Continuous Inoperation. - If a trustee shall be elected for a term not exceeding
corporation does not formally organize and three (3) years from among the members of the
commence its business within five (5) years from corporation. Each director and trustee shall hold
the date of its incorporation, its certificate of office until the successor is elected and
incorporation shall be deemed revoked as of the qualified. A director who ceases to own at least
day following the end of five (5)-year period. one (1) share of stock or a trustee who ceases
However, if a corporation commenced its to be a member of the corporation shall cease to
business but subsequently becomes inoperative be such.

for a period of at least five (5)

The board of the following corporations vested
with public interest shall have independent
directors constituting at least twenty percent
(20% of such board;
• (a) Corporations covered by Section 17.2 of independence and align with international best
Republic Act No. 8799, otherwise known as practices.
"The Securities Regulation Code", namely those
whose securities are registered with the Section 23. Election of Directors and
Commission, corporations listed with an Trustees. - Except when exclusive right for
exchange or with assets of at least Fifty million holders of founders' shares under Section 7 of
pesos (P50,000,000.00) and having two this Code, each stockholder or member shall
hundred (200) or more holders of shares, each have the right to nominate any director or trustee
holding at lease one hundred (100) shares of who possesses all of the qualifications and none
class of its equity shares: of the disqualifications set for the in this Code.

• (b) Banks and quasi-banks, NSSLAs, At all elections of directors and trustees, there
pawnshops, corporations engaged in money must be present, either in person or through a
service business, preneed, trust and insurance representative authorized to act by written proxy,
companies, and other financial intermediaries; the owners of majority of the outstanding capital
and, stock, or if there be no capital stock, a majority
of the members entitled to vote. When so
• (c) Other corporations engaged in business authorized by the bylaws or by a majority of the
vested with public interest similar to the above, board of directors, the stockholders or members
as may be determined by the Commission, after may also vote through remote communication or
taking into account relevant factors which are in absentia. Provided: That the right to vote
germane to the objective and purpose of through such modes shall be exercised in
requiring the election of an independent director, corporations vested with public interest,
such as extent of minority ownership, type of notwithstanding the absence of a provision in
financial products or securities issued or offered the bylaws of such corporations.
to investors, public interest involved in the A stockholder or member who participates
nature of business operations, and other through remote communication or in absentia,
analogous factors. shall be deemed present for purposes of
quorum.
An independent director is a person who, apart The election must be by ballot if requested by
any voting stockholder or member.
from shareholdings and fees received from the
In stock corporations, stockholders entitled to
corporation, is independent of management and
vote shall have the right to vote the number of
free from any business of other relationship shares of stock standing in their own names in
which could, or could reasonably be perceived the stock books of the corporation at the time
to materially interfere with the exercise of fixed in the bylaws or where the bylaws are
independent judgment in carrying out the silent, at the time of election.
responsibilities as director. The said corporation may: (a) vote such number
of shares for as many persons as there are
directors to be elected; (b) cumulate said shares
Independent directors must be elected by the
and give one (1) candidate as many votes as the
shareholders present or entitled to vote in
absentia during the election of directors. number of directors to be elected multiplied by
Independent director shall be subject to rules the number of shares owned; or (c) distribute
and regulations governing their qualifications, them on the same principle among as many
disqualifications, voting requirements, duration candidates as may be seen fit: Provided, That
of term and term limit, maximum number of
the total number of votes cast shall not exceed
board memberships and other requirements that
the number of shares owned by the stockholders
the Commission will prescribe to strengthen their
as shown in the books of the corporation
multiplied by the whole number of directors to be
elected: Provided, however, That no delinquent
stock shall be voted. Unless otherwise provided
in the articles of incorporation or in the bylaws,
members of nonstock corporations may cast as
many votes as there are trustees to be elected
but mav not cast more than one (1) vote for one
(1) candidate. Nominees for directors or trustees
receiving the highest number of votes shall be
declared elected
If no election is held, or the owners of majority of
the outstanding capital stock or majority of the
members entitled to vote are not present in
person, by proxy, or through remote
communication or not voting in absentia at the
meeting., such meeting may be
adjourned and the corporation shall proceed in
accordance with Section 25 of this Code.
The directors or trustees elected shall perform
their duties as prescribed by law, rules of good
corporate governance, and bylaws
of the corporation.