With the Covid-19 forcing our government to switch to online filling, the Securities and Exchange Commission has finally launched the online application for One Person Corporation (OPC). It is important these days for those who would like to set up their business to check out available options, whether to go as a Single Proprietor with the Department of Trade and Industry or through OPC.
In 2019, the Securities and Exchange Commission (SEC) reenacted the archaic Corporation Code of the Philippines. One of the major changes is the approval of One Person Corporation (OPC) wherein a single person can finally establish a corporation, instead of the required minimum of 5 stockholders in a typical Stock (business) or Non-Stock (such as foundations) corporation set up. Before, the only option for an individual to start a business is to register as Single Proprietor under the Department of Trade and Industry.
Because of this change, entrepreneurs can now finally avail of the advantages of a corporation such as the limitation of liability and more credibility, similar to large scale business, just to name a few. Here are some fast facts that you need to know about:
Who is allowed to form a One Person Corporation
Filipinos, foreigners, Trusts, or Estate can apply for a One Person Corporation (OPC). Although the standard constitutional and statutory restrictions on foreign participation still apply. This pertains to the terms and conditions in Stock and Non-stock Corporation, the initial capitalization required (USD 100,000 or USD 200,000), and the businesses tagged in the negative list. For more details, you can check this link.
Who are not allowed to form a One Person Corporation:
This type of business structure is not available to banks, non-bank financial institutions, quasi-banks, pre-need, and trust, insurance, public and publicly listed companies, and non-chartered government-owned-and-control corporations (GOCCs).
Also, a person who is licensed to exercise a profession (such as lawyers, doctors, etc), may not organize an OPC for the purpose of exercising such profession
If you are one of the aspiring entrepreneurs who had been waiting for quite some time about the One Person Corporation (OPC), then today is your lucky day! We have listed the structure, requirements, and even the steps on how to apply.
What is the Corporate Structure:
- A person (of legal age), Trust or Estate
- A Nominee and an Alternate Nominee in the event of death or incapacity.
- A Treasurer (if the person would like to appoint 1)
- A Corporate Secretary (independent and who does not own any shares in the corporation).
What are the Requirements:
- Completely filled out application form online at (https://apps004.sec.gov.ph:8001/application)
- Cover Sheet (3 sets)
- 3 sets of Articles of Incorporation for One Person Corporation (Natural Person, Trust or Estate).
- Written consent from the nominee and the alternate nominee.
- Other requirements, if applicable such as:
- Proof of Authority to Act on behalf of the Trust or Estate (for Trusts and Estates incorporating as OPC).
- Foreign Investment Act application form.
- Affidavit of undertaking to Change Company Name, in case not incorporated in the Articles of Incorporation.
- Tax Identification Number (TIN) for Filipino single stockholder.
- Tax Identification Number (TIN) or passport for foreign single stockholder.
How to Apply Once the Application is Approved
- Go to SEC website online application form at https://apps004.sec.gov.ph:8001/application and fill out all the required information.
- Allow 3 working days for SEC to review your application. Check your email regularly.
- Manually prepare the other requirements and present the duly signed and notarized copies to your selected SEC office for submission within 30 days.
- Pay the necessary fees as well.
- Wait for the release of the Certificate of Registration.
For Disapproved Application
You have to re-apply the registration application. Corrections pointed out by the reviewing officer should be considered to avoid multiple re-application.
If you have additional questions that are not mentioned in this blog, please do not hesitate to get in touch with us. Lastly, for those who are interested to register as a One Person Corporation, but, does not have the patience to deal with government offices, get in touch with us as well! Our consulting team will be glad to help you walk through the application process.