XIV.

Dissolution
Sec. 133 SEC. 133. Methods of Dissolution. – A corporation formed or organized under the provisions of this
A. Methods of Code may be dissolved voluntarily or involuntarily.
Dissolution
Sec. 134 SEC. 134. Voluntary Dissolution Where No Creditors are Affected. – If dissolution of a corporation does
Voluntary not prejudice the rights of any creditor having a claim against it, the dissolution may be effected by
dissolution – majority vote of the board of directors or trustees, and by a resolution adopted by the affirmative vote
where no of the stockholders owning at least majority of the outstanding capital stock or majority of the members
creditors are of a meeting to be held upon the call of the directors or trustees.
affected
At least twenty (20) days prior to the meeting, notice shall be given to each shareholder or member of
record personally, by registered mail, or by any means authorized under its bylaws whether or not
entitled to vote at the meeting, in the manner provided in Section 50 of this Code and shall state that
the purpose of the meeting is to vote on the dissolution of the corporation. Notice of the time, place,
and object of the meeting shall be published once prior to the date of the meeting in a newspaper
published in the place where the principal office of said corporation is located, or if no newspaper is
published in such place, in a newspaper of general circulation in the Philippines.

A verified request for dissolution shall be filed with the Commission stating: (a) the reason for the
dissolution; (b) the form, manner, and time when the notices were given; (c) names of the stockholders
and directors or members and trustees, who approved the dissolution; (d) the date, place, and time of
the meeting in which the vote was made; and (e) details of publication.

The corporation shall submit the following to the Commission: (1) a copy of the resolution authorizing
the dissolution, certified by a majority of the board of directors or trustees and countersigned by the
secretary of the corporation; (2) proof of publication; and (3) favorable recommendation from the
appropriate regulatory agency, when necessary.

Within fifteen (15) days from receipt of the verified request for dissolution, and in the absence of any
withdrawal within said period, the Commission shall approve the request and issue the certificate of
dissolution. The dissolution shall take effect only upon the issuance by the Commission of a certificate
of dissolution.

No application for dissolution of banks, banking and quasi-banking institutions, preneed, insurance and
trust companies, nonstock savings and loan associations, pawnshops, and other financial
intermediaries shall be approved by the Commission unless accompanied by a favorable
recommendation of the appropriate government agency.
Sec. 135 SEC. 135. Voluntary Dissolution Where Creditors are Affected; Procedure and Contents of Petition. –
Voluntary Where the dissolution of a corporation may prejudice the rights of any creditor, a verified petition for
dissolution – dissolution shall be filed with the Commission. The petition shall be signed by a majority of the
where creditors corporation’s board of directors or trustees, verified by its president or secretary or one of its directors
are affected or trustees, and shall set forth all claims and demands against it, and that its dissolution was resolved
upon by the affirmative vote of the stockholders representing at least two-thirds (2/3) of the
outstanding capital stock or at least two-thirds (2/3) of the members at a meeting of its stockholders or
members called for that purpose. The petition shall likewise state: (a) the reason for the dissolution; (b)
the form, manner, and time when the notices were given; and (c) the date, place, and time of the
meeting in which the vote was made. The corporation shall submit to the Commission the following: (1)
a copy of the resolution authorizing the dissolution, certified by a majority of the board of directors or
trustees and countersigned by the secretary of the corporation; and (2) a list of all its creditors.

If the petition is sufficient in form and substance, the Commission shall, by an order reciting the
purpose of the petition, fix a deadline for filing objections to the petition which date shall not be less
than thirty (30) days nor more than sixty (60) days after the entry of the order. Before such date, a copy
of the order shall be published at least once a week for three (3) consecutive weeks in a newspaper of
general circulation published in the municipality or city where the principal office of the corporation is
situated, or if there be no such newspaper, then in a newspaper of general circulation in the
Philippines, and a similar copy shall be posted for three (3) consecutive weeks in three (3) public
places in such municipality or city.

Upon five (5) days’ notice, given after the date on which the right to file objections as fixed in the order
has expired, the Commission shall proceed to hear the petition and try any issue raised in the
objections filed; and if no such objection is sufficient, and the material allegations of the petition are
true, it shall render judgment dissolving the corporation and directing such disposition of its assets as
justice requires, and may appoint a receiver to collect such assets and pay the debts of the
corporation.
 The dissolution shall take effect only upon the issuance by the Commission of a certificate of
dissolution.
Sec. 136 SEC. 136. Dissolution by Shortening Corporate Term. – A voluntary dissolution may be effected by
Voluntary amending the articles of incorporation to shorten the corporate term pursuant to the provisions of this
dissolution – Code.
dissolution by
shortening A copy of the amended articles of incorporation shall be submitted to the Commission in accordance
corporate term with this Code. Upon the expiration of the shortened term, as stated in the approved amended articles
of incorporation, the corporation shall be deemed dissolved without any further proceedings, subject to
the provisions of this Code on liquidation.

In the case of expiration of corporate term, dissolution shall automatically take effect on the day
following the last day of the corporate term stated in the articles of incorporation, without the need for
the issuance by the Commission of a certificate of dissolution.
Sec. 137 SEC. 137. Withdrawal of Request and Petition for Dissolution. – A withdrawal of the request for
Voluntary dissolution shall be made in writing, duly verified by any incorporator, director, trustee, shareholder, or
dissolution – member and signed by the same number of incorporators, directors, trustees, shareholders, or
withdrawal of members necessary to request for dissolution as set forth in the foregoing sections. The withdrawal
request or shall be submitted no later than fifteen (15) days from receipt by the Commission of the request for
petition dissolution. Upon receipt of a withdrawal of request for dissolution, the Commission shall withhold
action on the request for dissolution and shall, after investigation: (a) make a pronouncement that the
request for dissolution is deemed withdrawn; (b) direct a joint meeting of the board of directors or
trustees and the stockholders or members for the purpose of ascertaining whether to proceed with
dissolution; or (c) issue such other orders as it may deem appropriate.

A withdrawal of the petition for dissolution shall be in the form of a motion and similar in substance to
a withdrawal of request for dissolution but shall be verified and filed prior to publication of the order
setting the deadline for filing objections to the petition.
Sec. 138 SEC. 138. Involuntary Dissolution. – A corporation may be dissolved by the Commission motu proprio or
Involuntary upon filing of a verified complaint by any interested party. The following may be grounds for dissolution
dissolution of the corporation:
(a)Non-use of corporate charter as provided under Section 21 of this Code;
(b)Continuous in operation of a corporation as provided under Section 21 of this Code;
(c)Upon receipt of a lawful court order dissolving the corporation;
(d)Upon finding by final judgment that the corporation procured its incorporation through fraud;
(e)Upon finding by final judgment that the corporation:
(1) Was created for the purpose of committing, concealing or aiding the commission of securities
violations, smuggling, tax evasion, money laundering, or graft and corrupt practices;
(2) Committed or aided in the commission of securities violations, smuggling, tax evasion, money
laundering, or graft and corrupt practices, and its stockholders knew; and
(3) Repeatedly and knowingly tolerated the commission of graft and corrupt practices or other
fraudulent or illegal acts by its directors, trustees, officers, or employees.

If the corporation is ordered dissolved by final judgment pursuant to the grounds set forth in
subparagraph (e) hereof, its assets, after payment of its liabilities, shall, upon petition of the
Commission with the appropriate court, be forfeited in favor of the national government. Such forfeiture
shall be without prejudice to the rights of innocent stockholders and employees for services rendered,
and to the application of other penalty or sanction under this Code or other laws.

The Commission shall give reasonable notice to, and coordinate with, the appropriate regulatory
agency prior to the involuntary dissolution of companies under their special regulatory jurisdiction.
Sec. 139 SEC. 139. Corporate Liquidation. – Except for banks, which shall be covered by the applicable
Corporate provisions of Republic Act No. 7653, otherwise known as the “New Central Bank Act,” as amended,
liquidation and Republic Act No. 3591, otherwise known as the Philippine Deposit Insurance Corporation Charter,
as amended, every corporation whose charter expires pursuant to its articles of incorporation, is
annulled by forfeiture, or whose corporate existence is terminated in any other manner, shall
nevertheless remain as a body corporate for three (3) years after the effective date of dissolution, for
the purpose of prosecuting and defending suits by or against it and enabling it to settle and close its
affairs, dispose of and convey its property, and distribute its assets, but not for the purpose of
continuing the business for which it was established.

At any time during said three (3) years, the corporation is authorized and empowered to convey all of its
property to trustees for the benefit of stockholders, members, creditors, and other persons in interest.
After any such conveyance by the corporation of its property in trust for the benefit of its stockholders,
members, creditors and others in interest, all interest which the corporation had in the property
terminates, the legal interest vests in the trustees, and the beneficial interest in the stockholders,
members, creditors or other persons in-interest.
 Except as otherwise provided for in Sections 93 and 94 of this Code, upon the winding up of corporate
affairs, any asset distributable to any creditor or stockholder or member who is unknown or cannot be
found shall be escheated in favor of the national government.

Except by decrease of capital stock and as otherwise allowed by this Code, no corporation shall
distribute any of its assets or property except upon lawful dissolution and after payment of all its debts
and liabilities.
XV. Foreign Corporations
Sec. 140 SEC. 140. Definition and Rights of Foreign Corporations. – For purposes of this Code, a foreign
Definition and corporation is one formed, organized or existing under laws other than the Philippines’ and whose laws
rights of allow Filipino citizens and corporations to do business in its own country or State. It shall have the right
foreign to transact business in the Philippines after obtaining a license for that purpose in accordance with this
corporations Code and a certificate of authority from the appropriate government agency.
Sec. 141 SEC. 141. Application to Existing Foreign Corporations. – Every foreign corporation which on the date of
Application to the effectivity of this Code is authorized to do business in the Philippines under a license issued to it,
existing foreign shall continue to have such authority under the terms and conditions of its license, subject to the
corporations provisions of this Code and other special laws.
Sec. 142 SEC. 142. Application for a License. – A foreign corporation applying for a license to transact business
Application for in the Philippines shall submit to the Commission a copy of its articles of incorporation and bylaws,
a license certified in accordance with law, and their translation to an official language of the Philippines, if
necessary. The application shall be under oath and, unless already stated in its articles of
incorporation, shall specifically set forth the following:
(a) The date and term of incorporation;
(b) The address, including the street number, of the principal office of the corporation in the country or
State of incorporation;
(c) The name and address of its resident agent authorized to accept summons and process in all legal
proceedings and all notices affecting the corporation, pending the establishment of a local office;
(d) The place in the Philippines where the corporation intends to operate;
(e) The specific purpose or purposes which the corporation intends to pursue in the transaction of its
business in the Philippines: Provided, That said purpose or purposes are those specifically stated in the
certificate of authority issued by the appropriate government agency;
(f) The names and addresses of the present directors and officers of the corporation;
(g) A statement of its authorized capital stock and the aggregate number of shares which the
corporation has authority to issue, itemized by class, par value of shares, shares without par value, and
series, if any;
(h) A statement of its outstanding capital stock and the aggregate number of shares which the
corporation has issued, itemized by class, par value of shares, shares without par value, and series, if
any;
(i) A statement of the amount actually paid in; and
(j) Such additional information as may be necessary or appropriate in order to enable the Commission
to determine whether such corporation is entitled to a license to transact business in the Philippines,
and to determine and assess the fees payable.

Attached to the application for license shall be a certificate under oath duly executed by the authorized
official or officials of the jurisdiction of its incorporation, attesting to the fact that the laws of the
country or State of the applicant allow Filipino citizens and corporations to do business therein, and
that the applicant is an existing corporation in good standing. If the certificate is in a foreign language,
a translation thereof in English under oath of the translator shall be attached to the application.

The application for a license to transact business in the Philippines shall likewise be accompanied by a
statement under oath of the president or any other person authorized by the corporation, showing to
the satisfaction of the Commission and when appropriate, other governmental agencies that the
applicant is solvent and in sound financial condition, setting forth the assets and liabilities of the
corporation as of the date not exceeding one (1) year immediately prior to the filing of the application.

Foreign banking, financial, and insurance corporations shall, in addition to the above requirements,
comply with the provisions of existing laws applicable to them. In the case of all other foreign
corporations, no application for license to transact business in the Philippines shall be accepted by the
Commission without previous authority from the appropriate government agency, whenever required by
law.
Sec. 143 SEC. 143. Issuance of a License. – If the Commission is satisfied that the applicant has complied with
Issuance of a all the requirements of this Code and other special laws, rules and regulations, the Commission shall
license issue a license to transact business in the Philippines to the applicant for the purpose or purposes
specified in such license. Upon issuance of the license, such foreign corporation may commence to
transact business in the Philippines and continue to do so for as long as it retains its authority to act as
 a corporation under the laws of the country or State of its incorporation, unless such license is sooner
surrendered, revoked, suspended, or annulled in accordance with this Code or other special laws.
Within sixty (60) days after the issuance of the license to transact business in the Philippines, the
licensee, except foreign banking or insurance corporations, shall deposit with the Commission for the
benefit of present and future creditors of the licensee in the Philippines, securities satisfactory to the
Commission, consisting of bonds or other evidence of indebtedness of the Government of the
Philippines, its political subdivisions and instrumentalities, or of government-owned or - controlled
corporations and entities, shares of stock or debt securities that are registered under Republic Act No.
8799, otherwise known as “The Securities Regulation Code”, shares of stock in domestic corporations
listed in the stock exchange, shares of stock in domestic insurance companies and banks, any financial
instrument determined suitable by the Commission, or any combination thereof with an actual market
value of at least Five hundred thousand (P500,000.00) pesos or such other amount that may be set by
the Commission: Provided however, That within six (6) months after each fiscal year of the licensee, the
Commission shall require the licensee to deposit additional securities or financial instruments
equivalent in actual market value to two (2%) percent of the amount by which the licensee’s gross
income for that fiscal year exceeds Ten million pesos (P10,000,000.00). The Commission shall also
require the deposit of additional securities or financial instruments if the actual market value of the
deposited securities or financial instruments has decreased by at least ten (10%) percent of their
actual market value at the time they were deposited. The Commission may, at its discretion, release
part of the additional deposit if the gross income of the licensee has decreased, or if the actual market
value of the total deposit has increased, by more than ten (10%) percent of their actual market value at
the time they were deposited. The Commission may, from time to time, allow the licensee to make
substitute deposits for those already on deposit as long as the licensee is solvent. Such licensee shall
be entitled to collect the interest or dividends on such deposits. In the event the licensee ceases to do
business in the Philippines, its deposits shall be returned, upon the licensee’s application therefor and
upon proof to the satisfaction of the Commission that the licensee has no liability to Philippine
residents, including the Government of the Republic of the Philippines. For purposes of computing the
securities deposit, the composition of gross income and allowable deductions therefrom shall be in
accordance with the rules of the Commission.
Sec. 148 SEC. 148. Amended License. – A foreign corporation authorized to transact business in the Philippines
Issuance of a shall obtain an amended license in the event it changes its corporate name, or desires to pursue other
license – or additional purposes in the Philippines, by submitting an application with the Commission, favorably
amendment endorsed by the appropriate government agency in the proper cases.
Sec. 144 SEC. 144. Who May be a Resident Agent. – A resident agent may be either an individual residing in the
Resident agent Philippines or a domestic corporation lawfully transacting business in the Philippines: Provided, That an
– qualifications individual resident agent must be of good moral character and of sound financial standing: Provided
further, that in case of a domestic corporation who will act as a resident agent, it must likewise be of
sound financial standing and must show proof that it is in good standing as certified by the
Commission.
Sec. 145 SEC. 145. Resident Agent; Service of Process. – As a condition to the issuance of the license for a
Resident agent foreign corporation to transact business in the Philippines, such corporation shall file with the
– service of Commission a written power of attorney designating a person who must be a resident of the
process Philippines, on whom summons and other legal processes may be served in all actions or other legal
proceedings against such corporation, and consenting that service upon such resident agent shall be
admitted and held as valid as if served upon the duly authorized officers of the foreign corporation at
its home office. Such foreign corporation shall likewise execute and file with the Commission an
agreement or stipulation, executed by the proper authorities of said corporation, in form and substance
as follows:

“The (name of foreign corporation) hereby stipulates and agrees, in consideration of being granted a
license to transact business in the Philippines, that if the corporation shall cease to transact business
in the Philippines, or shall be without any resident agent in the Philippines on whom any summons or
other legal processes may be served, then service of any summons or other legal process may be made
upon the Commission in any action or proceeding arising out of any business or transaction which
occurred in the Philippines and such service shall have the same force and effect as if made upon the
duly-authorized officers of the corporation at its home office.”

Whenever such service of summons or other process is made upon the Commission, the Commission
shall, within ten (10) days thereafter, transmit by mail a copy of such summons or other legal process
to the corporation at its home or principal office. The sending of such copy by the Commission shall be
a necessary part of and shall complete such service. All expenses incurred by the Commission for such
service shall be paid in advance by the party at whose instance the service is made.

It shall be the duty of the resident agent to immediately notify the Commission in writing of any change
in the resident agent’s address.
Sec. 139 Check Sec. 129 (Repertorial requirements)
Sec. 147 SEC. 147. Amendments to Articles of Incorporation or Bylaws of Foreign Corporations. – Whenever the
Amendments articles of incorporation or bylaws of a foreign corporation authorized to transact business in the
to AOI and Philippines are amended, such foreign corporation shall, within sixty (60) days after the amendment
bylaws becomes effective, file with the Commission, and in the proper cases, with the appropriate government
agency, a duly authenticated copy of the amended articles of incorporation or bylaws, indicating clearly
in capital letters or underscoring the change or changes made, duly certified by the authorized official
or officials of the country or state of incorporation. Such filing shall not in itself enlarge or alter the
purpose or purposes for which such corporation is authorized to transact business in the Philippines.
Sec. 149 SEC. 149. Merger or Consolidation Involving a Foreign Corporation Licensed in the Philippines. – One or
M&A of foreign more foreign corporations authorized to transact business in the Philippines may merge or consolidate
corporations with any domestic corporation or corporations if permitted under Philippine laws and by the law of its
incorporation: Provided, That the requirements on merger or consolidation as provided in this Code are
followed.

Whenever a foreign corporation authorized to transact business in the Philippines shall be a party to a
merger or consolidation in its home country or State as permitted by the law authorizing its
incorporation, such foreign corporation shall, within sixty (60) days after the effectivity of such merger
or consolidation, file with the Commission, and in proper cases, with the appropriate government
agency, a copy of the articles of merger or consolidation duly authenticated by the proper official or
officials of the country or state under whose laws, the merger or consolidation was effected: Provided
however, That if the absorbed corporation is the foreign corporation doing business in the Philippines,
the latter shall at the same time file a petition for withdrawal of its license in accordance with this Title.
Sec. 150 SEC. 150. Doing Business Without a License. – No foreign corporation transacting business in the
Doing business Philippines without a license, or its successors or assigns, shall be permitted to maintain or intervene
without a in any action, suit or proceeding in any court or administrative agency of the Philippines; but such
license corporation may be sued or proceeded against before Philippine courts or administrative tribunals on
any valid cause of action recognized under Philippine laws.
Sec. 151 SEC. 151. Revocation of License. – Without prejudice to other grounds provided under special laws, the
Revocation of license of a foreign corporation to transact business in the Philippines may be revoked or suspended by
license the Commission upon any of the following grounds:
(a) Failure to file its annual report or pay any fees as required by this Code;
(b) Failure to appoint and maintain a resident agent in the Philippines as required by this Title;
(c) Failure, after change of its resident agent or address, to submit to the Commission a statement of
such change as required by this Title;
(d) Failure to submit to the Commission an authenticated copy of any amendment to its articles of
incorporation or bylaws or of any articles of merger or consolidation within the time prescribed by this
Title;
(e) A misrepresentation of any material matter in any application, report, affidavit or other document
submitted by such corporation pursuant to this Title;
(f) Failure to pay any and all taxes, imposts, assessments or penalties, if any, lawfully due to the
Philippine Government or any of its agencies or political subdivisions;
(g) Transacting business in the Philippines outside of the purpose or purposes for which such
corporation is authorized under its license;
(h) Transacting business in the Philippines as agent of or acting on behalf of any foreign corporation or
entity not duly licensed to do business in the Philippines; or
(i) Any other ground as would render it unfit to transact business in the Philippines.
Sec. 152 SEC. 152. Issuance of Certificate of Revocation. – Upon the revocation of the license to transact
Certificate of business in the Philippines, the Commission shall issue a corresponding certificate of revocation,
revocation furnishing a copy thereof to the appropriate government agency in the proper cases. The Commission
shall also mail the notice and copy of the certificate of revocation to the corporation, at its registered
office in the Philippines.
Sec. 153 SEC. 153. Withdrawal of foreign corporations. – Subject to existing laws and regulations, a foreign
Withdrawal of corporation licensed to transact business in the Philippines may be allowed to withdraw from the
foreign Philippines by filing a petition for withdrawal of license. No certificate of withdrawal shall be issued by
corporations the Commission unless all the following requirements are met:
(a) All claims which have accrued in the Philippines have been paid, compromised or settled;
(b) All taxes, imposts, assessments, and penalties, if any, lawfully due to the Philippine Government or
any of its agencies or political subdivisions have been paid; and
(c) The petition for withdrawal of license has been published once a week for three (3) consecutive
weeks in a newspaper of general circulation in the Philippines.