
The Securities and Exchange Commission has finally issued the guidelines on the establishment of a "One Person Corporation

" (OPC) pursuant to the Republic Act No. 11232, otherwise known as the Revised Corporation Code of the Philippines, through SEC Memorandum Circular No. 7, series of 2019.
The following guidelines, rules and regulations in the establishment of a One Person Corporation (OPC) are hereby adopted:
Section 1. Definition
A one person corporation (OPC) is a corporation with a single stockholder

, who can only be a natural person, trust or estate. The incorporator of an OPC being a natural person must be of legal age. As an incorporator, the "trust" as used by the law does not refer to a trust entity, but the subject being managed by a trustee. If the single stockholder is a trustee, administrator, executor, guardian, conservator, custodian, or other person exercising fiduciary duties, proof of authority to act on behalf of the trust or estate must be submitted at the time of incorporation.
Section 2. Term of Existence
The term of existence of the OPC shall be perpetual. However, in case of the trust or estate, its term of existence shall be co-terminous with the existence of the trust or estate. The OPC under the name of the estate may be dissolved upon proof of Partition, such as Order of Partition issued by the Court in case of Judicial Settlement, and Deed of Extra-Judicial Settlement in case of summary settlement of the estate. The OPC under the name of the Trustee may be dissolved upon proof of termination of the trust.
Section 3. Corporate Name
The suffix "OPC" should be indicated by the one person corporation either below or at the end of its corporate name.
Section 4. Single Stockholder as Director and Officer
The single stockholder shall be the sole director and president of the OPC.
Section 5. Designation of Nominee and Alternate Nominee
The single stockholder is required to designate a nominee and an alternate nominee named in the Articles of Incorporation

who shall replace the single stockholder in the event of the latter's death and/or incapacity. The written consent of both the nominee and alternate nominee shall be attached to the application for incorporation.
Section 6. Only Articles of Incorporation Needed
The OPC shall file its Articles of Incorporation (AI) in accordance with the requirements of Section 14 of the Revised Corporation Code

of the Philippines. The AI must set forth its primary purpose, principal office address, term of existence, names and details of the single stockholder, the nominee and alternate nominee and the authorized, subscribed and paid-up capital and such other matters consistent with law and which may be deemed necessary and convenient.
Section 7. By-Laws
The OPC is not required to submit and file its Bylaws.
Section 8. Minimum Capital Stock Not Required
The OPC is not required to have a minimum authorized capital stock except as otherwise provided by special law. Further, unless otherwise required by applicable laws or regulations, no portion of the authorized capital is required to be paid-up at the time of incorporation.
Section 9. Officers
Within fifteen (15) days From the issuance of its Certificate of Incorporation, the OPC shall appoint a Treasurer, Corporate Secretary, and other officers and notify the SEC thereof within five (5) days from appointment using the Appointment Form as may be prescribed by the SEC. The single stockholder shall not be appointed as Corporate Secretary but may assume the role of a Treasurer.
Section 10. Bond Requirement for the Self-Appointed Treasurer
The single stockholder who assumes the position of the Treasurer shall post a surety bond to be computed based on the authorized capital stock (ACS) of the OPC as shown in the Table below:
ACS |
Surety Bond
Coverage* |
1.00 to 1,000,000.00 |
1,000,000.00 |
1,000,001.00 to 2.000.000.00 |
2,000,000.00 |
2,000,001.00 to 3,000,000.00 |
3,000,000.00 |
3,000,001.00 to 4,000,000.00 |
4,000,000.00 |
4,000,001.00 to 5,000,000.00 |
5,000,000.00 |
P
5,000,001.00 and above = Amount of surety bond coverage shall be equal to the
OPC's ACS |
* subject to renewal every two (2) years or as may be required, upon review of the annual submission of the Audited Financial Statements/Financial Statements certified under oath by the company's President and Treasurer.
* The bond is a continuing requirement for so long as the single stockholder is the self-appointed Treasurer of the OPC.
* The bond may be cancelled upon proof of appointment of another person as the Treasurer and Filing of Amended Form for Appointment of Officers.
Section 11. Change of Nominee or Alternate Nominee
The single stockholder may, at any time, change its nominee and alternate nominee by submitting to the Commission the names of the new nominees and their corresponding written consent. The Articles of Incorporation need not be amended.
Section 12. Incapacity or Death of the Single Stockholder
In case the single stockholder becomes incapacitated, the nominee can take over the management of the OPC as director and president. At the end of the incapacity, the single stockholder can resume the management of the OPC. In case of death or permanent incapacity of the single stockholder, the nominee will take over the management of the OPC until the legal heirs of the single stockholder have been lawfully determined and the heirs have agreed among themselves who will take the place of the deceased.
Section 13. Reportorial Requirements
The OPC must submit the following documents within the period required by the SEC:
a) annual audited financial statements within 120 days from the end of its fiscal year as indicated in its Articles of Incorporation; Provided, that if the total assets or total liabilities of the corporation are less than six hundred thousand pesos (P600,000.00). the financial statements shall be certified under oath by the corporation's treasurer;
b) a report on all explanations or comments by the president on the qualification, reservation or adverse remarks made by the auditor in the financial statements;
c) a disclosure of all self-dealings and related party transactions

entered into between the OPC and the single stockholder; and
d) other reports as the SEC may require.
Section 14. Who are Not Allowed to Form OPCs
Banks, non-bank financial institutions

, quasi-banks, pre-need, trust, insurance, public and publicly listed companies, non-chartered government-owned and controlled corporations (GOCCs) cannot incorporate as OPC. A natural person who is licensed to exercise a profession may not organize as an OPC for the purpose of exercising such profession except as otherwise provided under special laws.
Section 15. Foreign National
A foreign natural person

may put up an OPC, subject to the applicable capital requirement and constitutional and statutory restrictions on foreign participation in certain investment areas or activities.
Thank you for sharing meaningful and helpful issues. God bless you.
ReplyDelete