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House approves Revised Corporation Code

Updated

 

By Ben Rosario

The House of Representatives passed on third and final reading the proposed Revised Corporation Code of the Philippines which provides for the inclusion into Philippine commerce and business of internationally accepted best standards and practices.

The Joint Session of the Senate and the House of Representatives on the extension of Martial Law in Mindanao commences in the Plenary of the Batasang Pambansa on December 13, 2017. (ALVIN KASIBAN / MANILA BULLETIN)

(MANILA BULLETIN)

With 165 congressmen voting in the affirmative and zero negative, House Bill 8374 was approved Monday night.

The measure allows the perpetual existence of a corporation and the formation of one person corporations, thus, removing the minimum number of incorporators.

The approval places the legislative chamber on track for the scheduled implementation of the measure in January, 2019.

Consolidating six different legislative proposals, HB 8374 or the Revised Corporation Code of the Philippines seeks to encourage the creation of new business, contribute to the ease of doing business in the country, and minimize or deter corporate abuses and fraud while it strengthens anti-corruption measures.

Signing into law by December

Romualdo, chairman of the House Committee on Good Government and Public Accountability, aired confidence that third reading approval is assured even as the House leadership targets the bill’s signing into law by December.

“Our targets then are to have the conference committee report approved by both chambers in November, have the bill signed into law by the President in December, and for the

Revised Corporation Code to take effect by January, 2019,” Romualdo said.

“Our current Corporation Code was enacted in 1980. Obviously, much has changed in how the world does business, communicates, and undertakes commercial transactions over the last 38 years,” he explained.

On the other hand, Iloilo Rep. Ferjenel G. Biron, chairman of the House Committee on Trade and Industry,said the bill removes the requirement of subscribed and paid-up capital stock for the purposes of incorporation.

Romualdo said the bill also authorizes the electronic submission of articles of incorporation or its amendments.

Remote communication for attendance in meetings, voting in absentia during meetings and issuance by the Securities and Exchange Commission of certificates of incorporation in the form of an electronic document are also provided in the measure.

Int’l best practices

Romualdo said the Revised Corporation Code adopts international best practices and standards in corporate law and will allow corporations in the Philippines to respond to and meet the needs and realities of the present times.

“By updating and modernizing our main body of corporate law, the Revised Corporation Code will encourage entrepreneurship and the creation of new businesses, contribute to ease of doing business, strengthen corporate governance, better protect the rights of stockholders, deter corporate abuse and fraud, and bolster anti-corruption measures and the regulatory authority of the Securities and Exchange Commission (SEC),” Romualdo explained.

Senate approved its version of the measure last August.

Principal authors of the bill include Reps. Johnny Pimentel (PDP-Laban, Surigao del Sur),RodelBatocabe (Ako Bicol Partylist), Alfredo A. Garbin Jr. (Aco Bicol Partylist); Evelina G. Escudero (NPC, Sorsogon), Xavier Jesus D. Romualdo (PDP-Laban, Camiguin), and Edgar Mary Sarmiento (LP, Samar).

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