corp code of the phil atty victor alcoriza
TRANSCRIPT
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Atty.ThelmaR.VictorAlcoriza
CompanyRegistration
and
Monitoring
Department
SecuritiesandExchangeCommission
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Section106,CorporationCode
Educationalcorporationsshallbegovernedby
1. speciallaws;and
2.
the
general
provisions
of
the
CorporationCodeofthe
Philippines.2
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SpecialLaw
BP232
(Education
Act
of
1982),
as
amendedbyRANo.7798(1994)
Section 25 mandates the incorporation
of schools either as stock or non
stockeducational corporations under theprovisions of the Corporation Code.
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CorporationCode SpecialProvisions
TitleXIII,
Special
Corporations;
ChapterI,EducationalCorporationsS106:IncorporationS107: requiresfavorableDepEd recommendation
asaprerequisitetoSECregistrationS108: Boardoftrustees
GeneralProvisions(e.g.onmeetings,voting,bylaws,officers,
etc.)4
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5
SECRegistration
DepEdRegistration
PrimaryFranchise
SecondaryFranchise
LegalPersonality
License orAuthorityto
Operate
General
Supervision
Direct
Supervision(RegulationofOperations
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Whatisacorporation?(S22)
artificial
being createdbyoperationoflaw hastherightofsuccession has
the
powers,
attributes
and
propertiesexpresslyauthorized by
law(Section
36)
or
incident
to
its
existence
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AdvantagesOverUnregisteredAssociations(XIIISECQuarterlyBulletin,Opinion,26June1989)
enjoysperpetual
succession
hasthecapacitytoenterintocontracts
(e.g.,take
and
grant
property)
cansue(andbesued)
has
the
capacity
to
receive
and
enjoy
commongrantsandprivilegesandimmunities
itsstockholders/members
have
generally
no
personalliabilitybeyondthevalueoftheirshares/contribution
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ImportantDoctrines DoctrineofCorporateFiction
Thecorporation
has
alegal
personality
separate
and
distinctfromthosecomposingit.
DoctrineofPiercingtheVeilofCorporateEntity(DisregardingtheFictionofCorporateEntity):
Theseparatepersonalityofacorporationmaybedisregardedifsuchentityisavailedoftodefeatpublicconvenience,justifyawrong,protectfraudordefendcrime.
Estoppel DoctrineAnadmissionorrepresentationisrenderedconclusiveas
againstthepersonrelyingthereon.
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Classes
of
Educational
Corporations
Stock NonStock
withcapitalstockdividedintoshares
nocapitalstock;fundscomefromdonationsandcontributions
authorizedtodistributedividends nodistributionofdividends;income,ifany,shallnotinuretothebenefitofanymember,trustee orofficer
atleast60%ofthecapitalmustbeownedbycitizensofthePhilippines(par.1,Section4(2),ArticleXIV,PhilippineConstitution)
atleast60%ofthetotalmembershipmustbecitizensofthePhilippines(par.1,Section4(2),ArticleXIV,PhilippineConstitution)
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Corporate
Term
(S11)
50yearsfromthedateofincorporation
unless:
soonerdissolved,
registrationrevokedonlawfulgrounds,
orperiod
extended
unlimitednumberoftimes
butnotmorethan50yearsineachinstance
by
amendment
of
the
AI (S16)
priortoexpirydate
butnotearlierthan5yearspriortoexpiration,
exceptforjustifiablereasons asmaybe
determinedby
SEC
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PrincipalOffice wherethecorporatebooksandrecordsarekept;
notnecessarilytheplacewherethebusinessistransacted
mustbe
located
within
the
Philippines
(Section14[3])
ratio: acorporationmaylegallyexistonlywithinthe
boundariesofthecountryunderthelawof
whichit
was
organized
determinestheresidenceofthecorporation
(fixesthejurisdictionofthecourtsorvenueofactionsbyor
againstthe
corporation;
facilitates
service
of
process;
determinesthetaxsitus;determinestheprovincewhere achattelmortgageofsharesshouldberegistered;fixesthe
placeof
meetings
of
stockholders/members)
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PersonsInvolved
1. Incorporators2. Stockholders/Members
3. Boardof
Directors/Trustees
4. Officers
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Incorporators(S5&S10)
personsmentionedintheAIasoriginallyformingandcomposingthecorporationand
whoare
signatories
thereof
number:atleast5butnotmorethan15
naturalperson
oflegalage
majorityare
residents
of
the
Philippines
instock: mustownsatleast1shareofstock;
innonstock: mustbeamember
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Stockholders/Members
Stock:
Stockholders Non
stock:
Membersbecomesuchbypurchasingstocksdirectlyfrom thecorporationorfromindividualowners
becomesuchbyvirtueofadmissiontothecorporation
maybe
natural
or
juridical
persons same
atleast60%ofthecapitalmustbeownedbycitizensofthePhilippines(par.
1,Section
4(2),
Article
XIV,
Philippine
Constitution)
atleast60%ofthetotalmembershipmustbecitizensofthePhilippines(par.
1,Section
4(2),
Article
XIV,
Philippine
Constitution)
shares ofstocktransferable membershipnottransferable, unlesstheAIorBLprovidesotherwise
must berecordedintheStockandTransferBook
must berecordedintheMembershipBook
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Board
of
Directors/Trustees exercises thecorporatepowers
conductsallbusiness
controlsall
properties
actsasabody
*
A
majority
of
the
number
as
fixed
in
the
AI
shall
constituteaquorum.Everydecisionofatleastmajorityofthedirectors/trusteespresentatmeetings
at
which
there
is
a
quorum
shall
be
valid
as
a
corporate
act,exceptintheelectionofofficerswhichrequiresthevoteofmajorityofallthemembersoftheboard.
(S25)
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Board
of
Directors/Trustees
Stock:BoardofDirectors Nonstock:Boardof Trustees
atleast5butnotmorethan15(S14)
atleast5butnotmorethan
15
andin
multiples
of
5
(S108)
majority areresidentsofthePhilippines(S23)
same
allarenaturalpersons same
allare
of
legal
age same
eachisaholderofatleast1
share
(S23)
eachisamember(S92)
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Board
of
Directors/Trustees
Stock:BoardofDirectors Nonstock:Boardof Trustees
allarecitizensofthe
Philippines
(par.2,
Section
4(2),
Article
XIV,
PhilippineConstitution)
same
term ofoffice:1year,and
untiltheir
successors
are
electedandqualified(holdover)(S23)
1to5yearsasfixedintheAI
orBL;
but if
the
AI
or
BL
is
silent,assoonasorganized,classify,staggeredbasis:1/5
shallexpire
every
year;
thereafter,termshallbe5years(S108)
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Board
of
Directors/Trustees:
Election(S24)
quorum:majorityoftheOCS/members,entitledtovotemustbepresenteitherinpersonorbyproxy
entitledtovote:
instock:
not
denied
voting
rights
under
BL;
not
delinquent;
those
formingpartoftheOCS,perSTB,asofcutoffdatefixedin
theBL;if BLissilent,asofthedayof election
innon
stock:
members
recorded
in
the
MB
as
of
cut
off
date
fixed
in
theBL;if BLissilent,asofthedayofelection
manner:vivavoce;raisingofhands;byballot,ifrequestedby
any
voting
stockholder/member
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Board
of
Directors/Trustees:
Election(S24)
Stock:CumulativeVoting allowed1. astockholdermayvotesuchnumberofsharesforasmany
personsastherearedirectorstobeelected,or2. he
may
cumulate
said
shares
and
give
1candidate
as
many
votesasthenumberofdirectorstobeelectedmultipliedbythenumberofsharesshallequal,or
3. hemaydistributethemonthesameprincipleamongasmanycandidates
as
he
shall
see
fit
Provided: thetotalnumberofvotescastbyhimshallnotexceedthenumberofsharesownedbyhimasshownintheSTBmultipliedbythenumberofdirectorstobeelected
NonStock: unlesstheAIorBLsoprovide,amembermaycastonlyasmanyvotesastherearetrusteestobeelectedbuthemaynotcastmorethan1vote for1candidate
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BoardofDirectors/Trustees:
Vacancies(S29)
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GeneralRule:Vacanciesmaybefilledbytheremainingmembersoftheboard(ifstill
constitutingaquorum).
Exceptions:mustbefilledbythestockholders/members inaregular/specialmeetingcalledforthat
purpose
removal&expirationofterm(serveonlyfortheunexpiredterm)
increaseinthenumberofdirectors/trustees(orinthesamemeetingauthorizingtheincreaseifsostatedinthenotice
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Meetings(S49S59)Stockholders/Members BoardofDirectors/Trustees
WhenHeld:Regular:annually ondatefixedintheBL;if
fixedin
the
BL,
on
any
date
in
April
ofeveryyearasdeterminedbytheboard
Special:heldatanytimedeemednecessaryorasprovidedintheBL
Regular:monthly,unlesstheBLprovide
Otherwise
Special:
atany
time
upon
the
call
of
thepresidentorasprovidedintheBL
Quorum:majorityoftheoutstandingcapitalstock/members
majorityofthenumberasfixedintheAI
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Meetings(S49S59)Stockholders/Members BoardofDirectors/Trustees
NoticeRequirement:
Regular:
writtennotice
(specifying
date,
timeandplace)requiredatleast2weeksprior,unlessBLrequiresadifferentperiod;maybewaived
expresslyor
impliedly
Special:same,butatleast1week prior
same,butatleast1dayprior
PresidingOfficer:
President,unlessBLprovideotherwise
same
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Meetings(S49S59)Stockholders/Members BoardofDirectors/Trustees
VotingRight:
Stock: 1share:1vote;
GR:
shares
may
be
classified
in
AILimitations:nosharemaybedeprivedofvotingrights,exceptpreferredandredeemableshares (exceptincasesunderS6last
par.)wheretherearenonvotingshares,theremustbeaclasswithcompletevotingrights
Nonstock:1member:1vote,unlesslimitedbroadenedordeniedintheAIorBL
per head
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Meetings(S49S59)Stockholders/Members Boardof
Directors/Trustees
mayvoteinperson0rby
proxy
(S58);but
in
non
stock:AIorBLmayprovideotherwise(S89)
cannotvotebyproxy
Nonstock:votingbymailorother
similar meansallowed,
butmustbeprovidedforintheBL
tele/videoconferencing(SEC MC15S2001)
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Meetings(S49S59)Stockholders/Members BoardofDirectors/Trustees
PlaceofMeetings: inthecityormunicipality where
theprincipalofficeislocated
ifnon
stock:
BL
may
provideotherwise;conditions:with
proper noticeandmustbewithinthePhilippines(S93)
ifpracticable,
in
the
principal
office MMconsideredascity/
municipalityforpurposesof
meetings
anywhereinoroutsideofthePhilippines,unlesstheBLprovide
otherwise
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Officers(S25)
naturalpersons
citizensofthePhilippines(AntiDummyLaw;(par.2,Section4(2),ArticleXIV,PhilippineConstitution)
doesnotactasabody;eachhasadesignatedfunction
President alwaysadirector
otherofficersneednotbedirectors
Secretary alsoresidentofthePhilippines
compatiblepositionsmaybeheldbythesameperson
ifstock:electedbymajorityvoteofallthemembersoftheboard
of
directors
ifnonstock:maybeelectedbythemembers,unlessotherwiseprovidedforintheAIorBL
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ReportorialRequirements(S141):
General
Information
Sheet filingperiod:within30calendardaysfromthedateof
theactualannualstockholders/membersmeeting
ifunable
to
hold
meeting:
not
later
than
January
30
of
thenextcalendaryear 5copies
inthe
form
prescribed
by
the
Commission
certifiedandsworntobytheCorporateSecretary submitalsoinelectronicformatifwithannualgross
revenue
of
at
least
PhP5M
changesbetweenannualmeetingsmustbereflectedinanamendedGISlabeledassuchwithchangesclearlyhighlighted submitwithin30calendardays
afterthe
occurrence
or
effectivity of
such
change
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ReportorialRequirements(S141):
Financial
Statements filingperiod:within120calendardaysaftertheendofthe
fiscalyearasspecifiedintheBL
for2009
&
2010:
number
coding
(last
numerical
digit)
mustbeauditedbyanindependentCPAaccreditedwiththeBOAif:
stockwith
paid
up
capital
of
PhP50,000
or
more
nonstock withannualgrossreceiptsof PhP100,000ormore,ortotalassetsofPhP500,000ormore
otherwise:mayattheminimumbecertified,underoath,bytheTreasurerofthecorporation
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ReportorialRequirements:
Penalties(S144)
1. Fine
Scaleof
Fines
basedonretainedearnings/fund
balance notexceedPhP10,000peryear
2.
Suspension
3. RevocationoftheCertificateofIncorporation
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Dissolution:
Methods1. Voluntary wherenocreditorsareaffected(S118) wherecreditorsareaffected(S119) shorteningofcorporateterm(S120)
2. Involuntary
(S121)
uponfilingofaverifiedcomplaint afterpropernoticeandhearing on
grounds
provided
by
existing
laws,
rules
®ulations
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Liquidation:
DistributionofAssetsinGeneral
Thecorporations
property
constitutes
atrust
fund
for
thepaymentofdistributionofdebtsanddistributiontostockholders.
Thetrust
fund
doctrine
epitomizes
the
idea
of
equal
protectiontocreditorsandproratadistributionincaseofinadequacyofcorporateassetstopayalldebts.
Thestockholders
are
entitled
to
participate,
pro
rata,
in
theassets,afterpaymentofthecreditors,unlessregulatedbytheAI.
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Liquidation:
Distribution
of
Assets
inNonstockCorporationsRulesfordistribution(S94):
1. Payment
of
all
liabilities
and
obligations
or
adequate
provision
therefor shall
bemade.
2. Returnofallassetshelduponaconditionrequiringreturn,transferorconveyancethereofandwhichconditionoccursbyreasonofdissolution.
3. Assetsheldsubjecttolimitationspermittingtheiruseonlyforeducational
purposes
shall
be
transferred
to
1
or
more
similar
educational
corporations.4. AssetsotherthantheaboveshallbedistributedinaccordancewiththeprovisionsoftheAIorBL.
5. Inanyothercase,assetsmaybedistributedtosuchpersons,societies,organizationsorcorporationsasmaybespecifiedintheplanofdistribution
(adoptedby
the
BOT
thru
aresolution;
written
notice
of
the
meeting
on
the
proposedplangiventomembers;approvalbyatleast2/3ofthemembersrequired)(S95)
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Cases:JurisdictionSEC
Petitionfor
the
calling
of
annual
meeting
under
S51
PetitionforchangeofnameforviolationofS18 Petitionforrevocationoflicenseforgroundsstatedunder
PD902A,S6(l):
fraudin
procuring
certificate
of
registration
seriousmisrepresentationonwhatthecorporationcandoorisdoingtothegreatprejudiceordamagetothegeneralpublic
refusaltoobeylawfulorderoftheSEC continuous
inoperation for
aperiod
of
at
least
5years
failuretofileBLwithintherequiredperiod failuretofiletherequiredreportsinthefrompresrcibed bySEC
within
the
appropriate
period
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Cases:Jurisdiction
RegularCourts
(SRC,
S5.2
&
PD902
A,
S5)
Casesinvolving:
devices/schemesemployedbytheboard/officersamounting
to
fraud
and
misrepresentation
which
may
bedetrimentaltopublicinterestortostockholders/membersofSECregisteredcorporations
intracorporate
controversies
electioncontroversies
Petitionforsuspensionofpayments
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