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A foreign corporation lawfully doing business in the Philippines shall be bound by all laws applicable to domestic corporations
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A foreign corporation authorized to transact business in the Philippines shall obtain an amended license in the event it changes its corporate name
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The license of a foreign corporation to transact business in the Philippines may be revoked or suspended by the Securities and Exchange Commission
The Revised Corporation Code of the Philippines (RCC) provides that a foreign corporation lawfully doing business in the Philippines shall be bound by all laws, rules and regulations applicable to domestic corporations of the same class, except those which provide for the creation, formation, organization or dissolution of corporations or those which fix the relations, liabilities, responsibilities, or duties of stockholders, members, or officers of corporations to each other or to the corporation.
Now, whenever the articles of incorporation or bylaws of a foreign corporation authorized to transact business in the Philippines are amended, such foreign corporation shall, within sixty (60) days after the amendment becomes effective, file with the Securities and Exchange Commission (SEC), 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.
In the event that the foreign corporation authorized to transact business in the Philippines changes its corporate name, or desires to pursue other or additional purposes in the Philippines, it shall obtain an amended license by submitting an application with the SEC, favorably endorsed by the appropriate government agency in the proper cases.
What is the effect if a foreign corporation, without a license, transacts business in the Philippines?
The law says:
No foreign corporation transacting business in the Philippines without a license, or its successors or assigns, shall be permitted to maintain or intervene in any action, suit or proceeding in any court or administrative agency of the Philippines; but such corporation may be sued or proceeded against before Philippine courts or administrative tribunals on any valid cause of action recognized under Philippine laws.
May the license of a foreign corporation to transact business in the Philippines be revoked?
The law says:
Yes.
The license of a foreign corporation to transact business in the Philippines may be revoked or suspended by the SEC upon any of the following grounds:
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Failure to file its annual report or pay any fees as required by the RCC;
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Failure to appoint and maintain a resident agent in the Philippines as required by the RCC;
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Failure, after change of its resident agent or address, to submit to the SEC a statement of such change as required by the RCC;
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Failure to submit to the SEC 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 the RCC;
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A misrepresentation of any material matter in any application, report, affidavit or other document submitted by such corporation;
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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;
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Transacting business in the Philippines outside of the purpose or purposes for which such corporation is authorized under its license;
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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
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Any other ground as would render it unfit to transact business in the Philippines.
Upon the revocation of the license to transact business in the Philippines, the SEC shall issue a corresponding certificate of revocation, furnishing a copy of said certificate to the appropriate government agency in the proper cases. The SEC shall also mail the notice and copy of the certificate of revocation to the corporation, at its registered office in the Philippines.
May a foreign corporation withdraw its license to transact business in the Philippines?
The law says:
Subject to existing laws and regulations, a foreign corporation licensed to transact business in the Philippines may be allowed to withdraw from the Philippines by filing a petition for withdrawal of license. No certificate of withdrawal shall be issued by the SEC unless the following requirements are met:
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All claims which have accrued in the Philippines have been paid, compromised or settled;
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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
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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.
Alburo Alburo and Associates Law Offices specializes in business law and labor law consulting. For inquiries, you may reach us at info@alburolaw.com, or dial us at (02)7745-4391/0917-5772207.
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