TITLE 13: SPECIAL CORPORATION

CHAPTER I: EDUCATIONAL CORPORATIONS classified into corporations sole and religious

societies.
SECTION 105: Incorporators - Religious corporations shall be governed by this
- Educational corporations shall be governed by Chapter and by the general provisions on
special laws and by the general provisions of nonstock corporations insofar as applicable
this Code.
Corporation Sole
SECTION 106: Board of Trustees - one formed by the chief archbishop, bishop,
- Trustees of educational institutions organized as priest, minister, rabbi or other presiding elder of
nonstock corporations shall not be less than a religious denomination, sect, or church, for
five (5) nor more than fifteen (15): Provided, the purpose Of administering or managing, as
That the number of trustees shall be in trustee, the affairs, properties and temporalities
multiples of five (5). of such religious denomination, sect or church."

- Unless otherwise provided in the articles of Corporate Aggregate

incorporation or bylaws, the board of trustees - Is one formed for the same purpose as
of incorporated schools, colleges, or other corporation sole. It consists of two or more
institutions of learning shall, as soon as persons.
organized, so classify themselves that the term
of office of one-fifth (1/5) of their number shall SECTION 108: Corporation Sole
expire every year. Trustees thereafter elected - For the purpose of administering and managing,
to fill vacancies, occurring before the expiration as trustee, the affairs, property and
of a particular term, shall hold office only for temporalities of any religious denomination,
the unexpired period. Trustees elected sect or church, a corporation sole may be
thereafter to fill vacancies caused by expiration formed by the chief archbishop, bishop, priest,
of term shall hold office for five (5) years. A minister, rabbi, or other presiding elder of such
majority of the trustees shall constitute a religious denomination, sect, or church.
quorum for the transaction of business. The
powers and authority of trustees shall be SECTION 109: Articles of Incorporation
defined in the bylaws. - In order to become a corporation sole, the chief
archbishop, bishop, priest, minister, rabbi or
- For institutions organized as stock corporations, presiding elder of any religious denomination,
the number and term of directors shall be sect or church must file with the Commission
governed by the provisions on stock articles of incorporation setting forth the
corporations. following:

(a) That the applicant chief archbishop, bishop,

Composition of the Board priest, minister, rabbi, or presiding elder represents
1. Non-stock Educational Corporation the religious denomination, sect, or church which
- Board of trustees shall not be less than 5 nor desires to become a corporation sole;
more than 15 provided that number of trustees
shall be in multiples of 5 (b) That the rules, regulations and discipline of the
religious denomination, sect or church are
2. Stock Educational Corporation consistent with becoming a corporation sole and do
- Board of directors shall be the same as in the not forbid it;
ordinary stock corporation is not less than 5
and not more than 15 (c) That such chief archbishop, bishop, priest,
minister, rabbi, or presiding elder is charged with
GR: Board of trustees shall, as soon as organized, so the administration of the temporalities and the
classify themselves that the term of office of 1/5 of their management of the affairs, estate and properties of
number shall be expire every year the religious denomination, sect or church within
the territorial jurisdiction, so described succinctly in
EXPN: Unless otherwise provided in its articles of the articles of incorporation;
incorporation or by-laws
(d) The manner by which any vacancy occurring in
CHAPTER II: RELIGIOUS CORPORATIOBS the office of chief archbishop, bishop, priest,
minister, rabbi, or presiding elder is required to be
SECTION 107: Classes of Religious Corporations filled, according to the rules, regulations or
- Religious corporations may be incorporated by discipline of the religious denomination, sect or
one or more persons. Such corporations may be church; and
 (e) The place where the principal office of the archbishop, bishop, priest, minister, rabbi, or
corporation sole is to be established and located, presiding elder acting as corporation sole, and
which place must be within the territory of the may be opposed by any member of the religious
Philippines. denomination, sect or church represented by
the corporation sole:
- The articles of incorporation may include any Provided, That in cases where the rules, regulations,
other provision not contrary to law for the and discipline of the religious denomination, sect or
regulation of the affairs of the corporation. church, religious society, or order concerned
represented by such corporation sole regulate the
SECTION 110: Submission of the Articles of method of acquiring, holding, selling, and mortgaging
Incorporation real estate and personal property, such rules,
- The articles of incorporation must be verified, regulations and discipline shall govern, and the
by affidavit or affirmation of the chief intervention of the courts shall not be necessary.
archbishop, bishop, priest, minister, rabbi, or
presiding elder, as the case may be, and GR: A corporation may sell or mortgage real property
accompanied by a copy of the commission, held it by obtaining an order for that purpose from the
certificate of election or letter of appointment Regional Trial Court of the province where the property
of such chief archbishop, bishop, priest, is situated upon proof that the notice of the application
minister, rabbi, or presiding elder, duly certified for leave to sell or mortgage has been made through
to be correct by any notary public. publication or as directed by the Court, and that it is in
the interest of the corporation that leave to sell or
- From and after filing with the Commission of mortgage be granted.
the said articles of incorporation, verified by
affidavit or affirmation, and accompanied by the EXPN: in cases where the rules, regulations, and
documents mentioned in the preceding discipline of the religious denomination, sect or church,
paragraph, such chief archbishop, bishop, religious society, or order concerned represented by
priest, minister, rabbi, or presiding elder shall such corporation sole regulate the method of
become a corporation sole and all acquiring, holding, selling, and mortgaging real estate
temporalities, estate and properties of the and personal property, such rules, regulations and
religious denomination, sect or church discipline shall govern, and the intervention of the
theretofore administered or managed as such courts shall not be necessary.
chief archbishop, bishop, priest, minister, rabbi,
or presiding elder shall be personally held in SECTION 112: Filling of Vacancies
trust as a corporation sole, for the use, - The successors in office of any chief archbishop,
purpose, exclusive benefit and on behalf of the bishop, priest, minister, rabbi, or presiding elder
religious denomination, sect or church, in a corporation sole shall become the
including hospitals, schools, colleges, orphan corporation sole on their accession to office
asylums, parsonages, and cemeteries thereof and shall be permitted to transact business as
such upon filing a copy of their commission,
certificate of election, or letters of
Effectivity of a Corporation Sole appointment, duly certified by any notary
- Upon filing with the SEC the articles of public with the Commission.
incorporation verified by affidavit or
affirmation, and accompanied by the required - During any vacancy in the office of chief
documents archbishop, bishop, priest, minister, rabbi, or
presiding elder of any religious denomination,
SECTION 111: Acquisition and Alienation of Property sect or church incorporated as a corporation
- A corporation sole may purchase and hold real sole, the person or persons authorized by the
estate and personal property for its church, rules, regulations or discipline of the religious
charitable, benevolent, or educational denomination, sect or church represented by
purposes, and may receive bequests or gifts for the corporation sole to administer the
such purposes. temporalities and manage the affairs, estate,
and properties of the corporation sole shall
- Such corporation may sell or mortgage real exercise all the powers and authority of the
property held by it by obtaining an order for corporation sole during such vacancy.
that purpose from the Regional Trial Court of
the province where the property is situated
upon proof that the notice of the application SECTION 113: Dissolution
for leave to sell or mortgage has been made - A corporation sole may be dissolved and its
through publication or as directed by the Court, affairs settled voluntarily by submitting to the
and that it is in the interest of the corporation Commission a verified declaration of
that leave to sell or mortgage be granted. The dissolution, setting forth:
application for leave to sell or mortgage must
be made by petition, duly verified, by the chief (a) The name of the corporation;
 fifteen (15), elected by the religious society or religious
(b) The reason for dissolution and winding up; order, or the diocese, synod, or district organization to
serve for the first year or such other period as may be
(c) The authorization for the dissolution of the prescribed by the laws of the religious society or
corporation by the particular religious denomination, religious order, or of the diocese, synod, or district
sect or church; and organization.

(d) The names and addresses of the persons who are to Religious societies or corporation aggregate
supervise the winding up of the affairs of the - It is incorporated by an aggregate of persons
corporation.
CHAPTER III: ONE PERSON CORPORATION
Upon approval of such declaration of dissolution by the
Commission, the corporation shall cease to carry on its SECTION 15: Applicability of Provisions to One Person
operations except for the purpose of winding up its Corporation
affairs - The provisions of this Title shall primarily apply
to One Person Corporations. Other provisions of
SECTION 114: Religious Societies this Code apply suppletorily, except as
- Unless forbidden by competent authority, the otherwise provided in this Title.
Constitution, pertinent rules, regulations, or
discipline of the religious denomination, sect or SECTION 16: One Person Corporation
church of which it is a part, any religious - A One Person Corporation is a corporation with
society, religious order, diocese, synod, or a single stockholder: Provided, That only a
district organization of any religious natural person, trust, or an estate may form a
denomination, sect or church, may, upon One Person Corporation. Banks and quasi-
written consent and/or by an affirmative vote banks, pre-need, trust, insurance, public and
at a meeting called for the purpose of at least publicly-listed companies, and non-chartered
two-thirds (2/3) of its membership, government-owned and -controlled
incorporate for the administration of its corporations may not incorporate as One
temporalities or for the management of its Person Corporations: Provided, further, That a
affairs, properties, and estate by filing with the natural person who is licensed to exercise a
Commission, articles of incorporation verified profession may not organize as a One Person
by the affidavit of the presiding elder, secretary, Corporation for the purpose of exercising such
or clerk or other member of such religious profession except as otherwise provided under
society or religious order, or diocese, synod, or special laws.
district organization of the religious
denomination, sect or church, setting forth the Who are not allowed to form OPCs?
following: 1. Banks and quasi-banking
2. Preneed
(a) That the religious society or religious order, or 3. Trust
diocese, synod, or district organization is a religious 4. Insurance
organization of a religious denomination, sect or church; 5. Public and publicly listed companies
6. Non-chartered GOCC
(b) That at least two-thirds (2/3) of its membership has
given written consent or has voted to incorporate, at a Foreign National
duly convened meeting of the body; - A person that can put up an OPC, subject to the
applicable capital requirement and
(c) That the incorporation of the religious society or constitutional and statutory restrictions on
religious order, or diocese, synod, or district foreign participation in certain investment areas
organization is not forbidden by competent authority or or activities
by the Constitution, rules, regulations or discipline of
the religious denomination, sect or church of which it Terms of Existence
forms part; - OPC is perpetual
- In case of the trust or estate, its term of
(d) That the religious society or religious order, or existence shall be co-terminous with the
diocese, synod, or district organization desires to existence of trust and estate
incorporate for the administration of its affairs, - Estate – dissolved upon proof of partition, such
properties and estate; as deed of extrajudicial settlement in case of
summary settlement of the estate
(e) The place within the Philippines where the principal - Trust – dissolved upon proof of determination
office of the corporation is to be established and of the trust
located; and
SECTION 117: Minimum Capital Stock Required for One
(f) The names, nationalities, and residence addresses of Person Corporation
the trustees, not less than five (5) nor more than
 - A One Person Corporation shall not be required SECTION 123: Special Functions of the Corporate
to have a minimum authorized capital stock Secretary
except as otherwise provided by special law. - In addition to the functions designated by the
One Person Corporation, the corporate
SECTION 118: Articles of Incorporation secretary shall:
- A One Person Corporation shall file articles of
incorporation in accordance with the (a) Be responsible for maintaining the minutes book
requirements under Section 14 of this Code. It and/or records of the corporation;
shall likewise substantially contain the
following: (b) Notify the nominee or alternate nominee of the
death or incapacity of the single stockholder, which
(a) If the single stockholder is a trust or an estate, notice shall be given no later than five (5) days from
the name, nationality, and residence of the trustee, such occurrence;
administrator, executor, guardian, conservator,
custodian, or other person exercising fiduciary (c) Notify the Commission of the death of the single
duties together with the proof of such authority to stockholder within five (5) days from such occurrence
act on behalf of the trust or estate; and and stating in such notice the names, residence
addresses, and contact details of all known legal heirs;
(b) Name, nationality, residence of the nominee and
and alternate nominee, and the extent, coverage
and limitation of the authority (d) Call the nominee or alternate nominee and the
known legal heirs to a meeting and advise the legal
SECTION 119: Bylaws heirs with regard to, among others, the election of a
- One Person Corporation is not required to new director, amendment of the articles of
submit and file corporate bylaws. incorporation, and other ancillary and/or consequential
- Only articles of incorporation is needed matters.

SECTION 120: Display of Corporate Name Note: OPC can designate other functions to the
- A One Person Corporation shall indicate the corporate secretary
letters “OPC” either below or at the end of its
corporate name. SECTION 124: Nominee and Alternate Nominee
- The single stockholder shall designate a
Note: Single stockholder shall be the sole director and nominee and an alternate nominee who shall,
president of the OPC in the event of the single stockholder’s death
or incapacity, take the place of the single
SECTION 121: Single Stockholder as Director, stockholder as director and shall manage the
President. corporation’s affairs.
- The single stockholder shall be the sole director
and president of the One Person Corporation - The articles of incorporation shall state the
names, residence addresses and contact
SECTION 122: Treasurer, Corporate Secretary and details of the nominee and alternate nominee,
Other Officers as well as the extent and limitations of their
- Within fifteen (15) days from the issuance of its authority in managing the affairs of the One
certificate of incorporation, the One Person Person Corporation.
Corporation shall appoint a treasurer,
corporate secretary, and other officers as it - The written consent of the nominee and
may deem necessary, and notify the alternate nominee shall be attached to the
Commission thereof within five (5) days from application for incorporation. Such consent
appointment. may be withdrawn in writing any time before
- Single stockholder may not be appointed as the death or incapacity of the single
corporate secretary stockholder.
- A single stockholder who is likewise the self-
appointed treasurer of the corporation shall
give a bond to the Commission in such a sum SECTION 125: Term of Nominee and Alternate
as may be required: Provided, That the said Nominee
stockholder/treasurer shall undertake in - When the incapacity of the single stockholder
writing to faithfully administer the One Person is temporary, the nominee shall sit as director
Corporation’s funds to be received as and manage the affairs of the One Person
treasurer, and to disburse and invest the same Corporation until the stockholder, by self
according to the articles of incorporation as determination, regains the capacity to assume
approved by the Commission. The bond shall be such duties.
renewed every two (2) years or as often as may
be required - In case of death or permanent incapacity of the
single stockholder, the nominee shall sit as
 director and manage the affairs of the One (d) Other reports as the Commission may require.
Person Corporation until the legal heirs of the
single stockholder have been lawfully - For purposes of this provision, the fiscal year of
determined, and the heirs have designated one a One Person Corporation shall be that set
of them or have agreed that the estate shall be forth in its articles of incorporation or, in the
the single stockholder of the One Person absence thereof, the calendar year.
Corporation.
Note: SEC may place the corporation under delinquent
- The alternate nominee shall sit as director and status should the corporation fail to submit the
manage the One Person Corporation in case of reportorial requirements 3 times consecutively or
the nominee’s inability, incapacity, death, or intermittently within a period of 5 years
refusal to discharge the functions as director
and manager of the corporation, and only for SECTION 130: Liability of Single Shareholder
the same term and under the same conditions - A sole shareholder claiming limited liability has
applicable to the nominee. the burden of affirmatively showing that the
corporation was adequately financed.

SECTION 126: Change of Nominee or Alternate - Where the single stockholder cannot prove that
Nominee the property of the One Person Corporation is
- The single stockholder may, at any time, independent of the stockholder’s personal
change its nominee and alternate nominee by property, the stockholder shall be jointly and
submitting to the Commission the names of severally liable for the debts and other
the new nominees and their corresponding liabilities of the One Person Corporation.
written consent. For this purpose, the articles
of incorporation need not be amended. - The principles of piercing the corporate veil
applies with equal force to One Person
SECTION 127: Minutes Book Corporations as with other corporations.
- A One Person Corporation shall maintain a
minutes book which shall contain all actions,
decisions, and resolutions taken by the One SECTION 131: Conversion from an Ordinary
Person Corporation. Corporation to a One Person Corporation
- When a single stockholder acquires all the
SECTION 128: Records in Lieu of Meetings stocks of an ordinary stock corporation, the
- When action is needed on any matter, it shall be latter may apply for conversion into a One
sufficient to prepare a written resolution, Person Corporation, subject to the submission
signed and dated by the single stockholder, of such documents as the Commission may
and recorded in the minutes book of the One require. If the application for conversion is
Person Corporation. The date of recording in approved, the Commission shall issue a
the minutes book shall be deemed to be the certificate of filing of amended articles of
date of the meeting for all purposes under this incorporation reflecting the conversion.
Code.
- The One Person Corporation converted from an
SECTION 129: Reportorial Requirements ordinary stock corporation shall succeed the
- The One Person Corporation shall submit the latter and be legally responsible for all the
following within such period as the Commission latter’s outstanding liabilities as of the date of
may prescribe: conversion

(a) Annual financial statements audited by an SECTION 132: Conversion from a Oner Person
independent certified public accountant: Provided, Corporation to an Ordinary Stock Corporation
That if the total assets or total liabilities of the - – A One Person Corporation may be converted
corporation are less than Six Hundred Thousand into an ordinary stock corporation after due
Pesos (P600,000.00), the financial statements shall notice to the Commission of such fact and of
be certified under oath by the corporation’s the circumstances leading to the conversion,
treasurer and president. and after compliance with all other
requirements for stock corporations under this
(b) A report containing explanations or comments Code and applicable rules. Such notice shall be
by the president on every qualification, filed with the Commission within sixty (60)
reservation, or adverse remark or disclaimer made days from the occurrence of the circumstances
by the auditor in the latter’s report; leading to the conversion into an ordinary stock
corporation. If all requirements have been
(c) A disclosure of all self-dealings and related complied with, the Commission shall issue a
party transactions entered into between the One certificate of filing of amended articles of
Person Corporation and the single stockholder; and incorporation reflecting the conversion.
- In case of death of the single stockholder, the
nominee or alternate nominee shall transfer
the shares to the duly designated legal heir or
estate within seven (7) days from receipt of
either an affidavit of heirship or self-
adjudication executed by a sole heir, or any
other legal document declaring the legal heirs
of the single stockholder and notify the
Commission of the transfer. Within sixty (60)
days from the transfer of the shares, the legal
heirs shall notify the Commission of their
decision to either wind up and dissolve the
One Person Corporation or convert it into an
ordinary stock corporation.

- The ordinary stock corporation converted from

a One Person Corporation shall succeed the
latter and be legally responsible for all the
latter’s outstanding liabilities as of the date of
conversion.