SEC implements new guidelines and procedures in the registration of corporate names
The Securities and Exchange Commission has issued on 21 June 2019 SEC Memorandum Circular No. 13 Series of 2019 providing for the guidelines and procedures in the registration of corporate, one person corporate and partnership names.
This is in conformity with the release of Republic Act No. 11232, otherwise known as the “Revised Corporation Code of the Philippines”, which provides a simpler way to register a corporation with the SEC and which now even permits the registration of one-person corporations or corporations with a single stockholder.
Some of the relevant items under the SEC Memorandum Circular include provisions which provide the words which should or may be added to the corporate name when forming the same, such as:
- If a corporation, the corporate name must contain either of the following words: “Corporation,” “Incorporated,” “Corp.,” or “Inc.”;
- If a One Person Corporation, the corporate name must contain the word “OPC” either below or at the end of its corporate name;
- If a partnership, the partnership name must contain the word “Company” or “Co.”;
- If a limited partnership, the partnership name must contain the word “Limited” or “Ltd.”;
- If a professional partnership, the partnership name may bear either of the following words: “Company,” “Associates,” or “Partners,” or other similar descriptions;
- If a foundation, the corporate name must use the word “Foundation”;
- If a non-stock, non-profit corporation, including non-governmental organizations and foundations engaged in microfinance activities, the corporate name must use the word “Microfinance” or “Microfinancing”; provided, that said corporations shall state in the purpose clause of their Articles of Incorporation that they shall conduct microfinance operations pursuant to Republic Act No. 8425 or the Social Reform and Poverty Alleviation Act;
- If an entity engaged in the financing or investment house business, the corporate name can contain the following words: “Finance Company,” “Financing Company,” “Finance and Leasing Company,” and “Leasing Company,” “Investment Company,” “Investment House”;
- If a lending company, the corporate name can contain either “Lending Company” or “Lending Investor;
- If an entity authorized to operate pawnshop, the corporate name can make use of “Pawnshop”;
- If an entity engaged in the banking or trust business, the corporate name can bear any of the following words: “Bank,” “Banking,” “Banker,” “Savings and Loan Association”, “Trust Corporation,” “Trust Company” or words of similar meaning;
- If the United Nations and its attached agencies, the words which can be used are “United Nations”, or “UN”;
- If entity with licensed warehouse, the corporate name can bear the word “Bonded”;
- If corporations authorized to act as special purpose vehicle, the corporate name can make use of “SPV-AMC”;
- The name of an international governmental organization, such as “International Criminal Police Organization” (INTERPOL), “International Monetary Fund” (IMF), and “International Labour Organization” (ILO) may not be used as part of a corporate or partnership name unless when duly authorized or allowed by the Commission”; and,
- ASEAN (protected under Article 6ter of the Paris Convention for the Protection of Industrial Property, adopted in 1883 and revised in Stockholm in 1976).
Moreover, as provided for in the Memorandum, the proposed name must be distinguishable from other corporate or partnership names such that in cases where there is similarity in the name applied for, the applicant must add one or more distinctive words to differentiate it from the one already existing. Punctuation marks, spaces, signs, symbols and other similar characters shall not be acceptable as distinguishing words if only to differentiate a proposed name from a registered name.
During application, the reservation or notice of availability of name does not constitute an approval of the use of such name or an application for a change of name. There must be no erasures, changes, modifications or alteration on a name reservation form. The approval of corporate and partnership names of new companies may be appealed or opposed, which shall be resolved by the Company Registration and Monitoring Department (CRMD). The CMRD is also in-charge of resolving complaints against proposed new names of existing companies or partnerships. The decisions of the CMRD may be appealed to the Commission En Banc through the Office of the General Counsel.
If a notice is received from the Commission for any of the following cases: (1) that another corporation, partnership or person has acquired prior right to the use of such name; (2) that the name has been declared not distinguishable from a name already registered or reserved for the use of another corporation; or (3) that it is contrary to law, public morals, good customs or public policy, then the corporation or partnership, at the time of its registration, must submit an affidavit containing an unqualified undertaking to change its name. Said affidavit shall be signed by at least two (2) incorporators or partners in the form prescribed by the Commission, unless the affidavit is no longer required if the undertaking is already included as one of the provisions of the Articles of Incorporation or Partnership of the registrant.
The Memorandum Circular shall amend all the issuances, orders, rules and regulations of the Commission which may be inconsistent with it and shall take effect immediately after its issuance.