Corporate Law Philippines

Practice Focus

• Corporation, OPC, and partnership formation and registration with the SEC
• Articles of incorporation, bylaws, and corporate secretary services
• Shareholders agreements and joint venture agreements
• Mergers, acquisitions, and corporate restructuring
• SEC compliance, reportorial requirements, and regulatory filings
• Corporate governance frameworks, board manuals, and compliance programs
• Foreign investment structuring and compliance with FIDA (RA 11647)
• Commercial contracts — supply, distribution, service, franchise, and agency agreements
• Corporate rehabilitation and insolvency under RA 10142
• Labor law compliance for corporations — DOLE, SSS, PhilHealth, Pag-IBIG
• BIR business registration, tax compliance, and business closure procedures
• PEZA, BOI, and special economic zone registration and incentives

Business Formation and Entity Selection in the Philippines

Choosing the right business structure is one of the most important decisions an entrepreneur or investor makes in the Philippines. The Revised Corporation Code (RA 11232) provides for several types of entities, each with distinct advantages and limitations. A Domestic Corporation offers the broadest operational flexibility, limited liability for shareholders, and the ability to issue shares to attract investment. A One Person Corporation (OPC), introduced by RA 11232, allows a single natural person, estate, or trust to act as a corporation, providing the simplicity of sole proprietorship with the limited liability protection of a corporation. A Branch Office of a foreign corporation allows foreign entities to operate directly in the Philippines without forming a separate legal entity, but requires a resident agent and annual SEC reporting. Abanto Law Firm advises clients on entity selection based on their investment objectives, foreign equity considerations, and tax efficiency goals.

Foreign equity restrictions are a critical consideration for investors in the Philippines. The Foreign Investment Act (RA 7042, as amended by RA 11647) and the Foreign Investment Negative List (FINL) reserve certain activities for Filipino nationals or limit foreign equity participation in specific industries. Key restricted sectors include mass media (0% foreign equity), retail trade below certain capital thresholds, domestic shipping, and the practice of licensed professions. The Retail Trade Liberalization Act of 2021 (RA 11595) raised the minimum paid-up capital for foreign retail participation. Understanding and navigating these restrictions is essential for foreign investors structuring their Philippine operations. Abanto Law Firm advises on compliant investment structures, the use of nominee arrangements, and the latest amendments to the FINL affecting specific industries.

The incorporation process in the Philippines involves preparing and filing Articles of Incorporation, By-Laws, and other required documents with the SEC, obtaining a Certificate of Incorporation (now called Certificate of Registration under RA 11232), and then proceeding with post-incorporation registrations with the Bureau of Internal Revenue (BIR) for a Tax Identification Number and tax compliance, the local government unit (LGU) for a business permit, and the Department of Labor and Employment (DOLE) for labor compliance. With the SEC's adoption of the online Company Registration System (CRS), the incorporation process has become more efficient. Abanto Law Firm handles the complete incorporation process on behalf of clients, from name verification and document preparation through all post-incorporation registrations, allowing entrepreneurs to focus on building their business. See our legal services page.

Corporate Governance and SEC Compliance

Good corporate governance is not merely a regulatory requirement — it is a business imperative that protects companies from legal liability, enhances investor confidence, and ensures sustainable long-term performance. The SEC Code of Corporate Governance for Publicly Listed Companies, Registered Issuers, and Covered Corporations imposes specific governance requirements on larger Philippine corporations, including the appointment of independent directors, the establishment of board committees (audit, nomination and remuneration, risk oversight), the adoption of a Board Charter and Manual on Corporate Governance, and compliance with disclosure and transparency obligations. Abanto Law Firm assists corporations in drafting and implementing corporate governance frameworks tailored to their size, industry, and regulatory requirements.

The SEC imposes annual reportorial requirements on all registered corporations, including the General Information Sheet (GIS), audited financial statements, and specific disclosures for covered companies under the Securities Regulation Code (RA 8799). Failure to comply with these requirements results in penalties, suspension of corporate privileges, and ultimately revocation of the Certificate of Registration. Under the Revised Corporation Code, corporations that have been inactive for at least five consecutive years may be placed under delinquent status and their corporate privileges suspended. Abanto Law Firm provides ongoing corporate secretary services — maintaining statutory records, organizing annual stockholder and board meetings, preparing board and stockholder resolutions, and filing all required SEC reports on time to keep client corporations in good standing. Contact us at contact us.

Mergers, Acquisitions, and Corporate Restructuring

Mergers and acquisitions in the Philippines are governed by the Revised Corporation Code, the Securities Regulation Code, Competition Act (RA 10667), and sector-specific regulations applicable to the target company's industry. A merger or consolidation under the RCC requires approval by the board of directors, ratification by at least two-thirds of the outstanding capital stock, and filing of a Plan of Merger or Consolidation with the SEC. The Philippine Competition Commission (PCC) has mandatory notification requirements for mergers and acquisitions that meet the threshold test for size of the transaction and the parties involved — currently set at PHP 5 billion in aggregate Philippine asset or revenue values. Abanto Law Firm provides comprehensive M&A legal services including transaction structuring, due diligence, negotiation, drafting of transaction documents, and regulatory filings.

Corporate restructuring — which may involve spin-offs, asset sales, business unit separations, or conversion of corporate form — is often undertaken for strategic, operational, or tax efficiency reasons. Restructuring transactions must be carefully planned to address regulatory requirements (SEC, BIR, PCC), labor law obligations to affected employees, contractual provisions in existing agreements that may be triggered by the restructuring (change of control clauses, novation requirements), and transfer pricing implications for related party transactions. Abanto Law Firm advises on the legal and regulatory implications of proposed restructuring transactions, develops compliant implementation plans, and guides clients through all required approvals and filings. See our legal blog for updates on Philippine M&A law and corporate restructuring developments.

Commercial Contracts and Business Agreements

Commercial contracts are the legal backbone of every business operation, defining the rights and obligations of the parties, allocating risks, and establishing mechanisms for dispute resolution. In the Philippine context, contracts must comply with the requirements of the Civil Code (consent, object, and cause), applicable regulatory requirements (for regulated industries), and any sector-specific laws governing the particular type of agreement. Common commercial contracts handled by Abanto Law Firm's corporate practice include supply and distribution agreements, service agreements and outsourcing contracts, franchise agreements, joint venture agreements, lease agreements, technology licensing agreements, and employment and independent contractor agreements. Our attorneys draft contracts that are practical, enforceable, and tailored to the specific business relationship and risk profile of each transaction.

Contract review and negotiation are equally important services for businesses that regularly enter into standard-form agreements with suppliers, customers, and service providers. Many businesses sign contracts without fully understanding the legal implications of provisions relating to liability caps, indemnification, intellectual property ownership, confidentiality, dispute resolution, and termination. These provisions can have enormous financial and operational consequences when a dispute arises. Abanto Law Firm provides contract review services that identify problematic provisions, propose more balanced alternatives, and advise on negotiation strategy. We also assist in resolving commercial contract disputes through demand letters, mediation, arbitration under the Alternative Dispute Resolution Act (RA 9285), and litigation before the RTC Commercial Courts.

PEZA, BOI, and Investment Incentives

The Philippines offers a range of investment incentives to qualifying enterprises through several investment promotion agencies. The Philippine Economic Zone Authority (PEZA) offers incentives to enterprises located in Special Economic Zones, including income tax holiday (ITH), reduced corporate income tax, VAT exemptions, and importation privileges. The Board of Investments (BOI) extends incentives to enterprises in priority investment areas under the Strategic Investment Priority Plan (SIPP). The Corporate Recovery and Tax Incentives for Enterprises Act (CREATE, RA 11534) overhauled the incentive system, introducing a more performance-based and time-bound framework for both PEZA and BOI incentives. Abanto Law Firm advises investors on qualification for incentives, application filing with PEZA and BOI, and compliance with incentive requirements to maintain registered enterprise status.

For information technology and business process management (IT-BPM) companies — one of the Philippines' largest growth industries — PEZA registration is particularly advantageous, providing significant tax savings and operational flexibility. Our firm has extensive experience in PEZA registration for IT-BPM companies, outsourcing and offshoring operations, and other knowledge-based enterprises that qualify for ecozone status. We also assist in Freeport Zone (SBMA, BCDA, PNOC) registration and compliance. Beyond initial registration, we advise registered enterprises on compliance with their ITH terms, annual performance report filings, expansion project registration, and transition to the 5% gross income earned (GIE) tax regime after the ITH period. Contact Abanto Law Firm at contact us for investment incentive advisory services for your Philippine business.

How We Work With Clients

1. Entity Selection and Investment Structuring. We assess your business objectives, industry, foreign equity considerations, and tax efficiency goals to recommend the optimal business structure — domestic corporation, OPC, branch, representative office, or partnership. We advise on foreign investment restrictions and compliance with the Foreign Investment Negative List.
2. Incorporation and SEC Registration. We prepare all required incorporation documents — Articles of Incorporation, By-Laws, SEC forms, and required undertakings — and handle filing with the SEC through the online Company Registration System. We verify the corporate name, obtain the Certificate of Incorporation, and manage all corrections or deficiency notices from the SEC.
3. Post-Incorporation Registrations. We handle all post-incorporation registrations required before commencing operations: BIR registration and issuance of Authority to Print (ATP), local government unit business permit, SSS, PhilHealth and Pag-IBIG employer registration, and DOLE reporting for employers with five or more employees.
4. Contracts, Governance, and Compliance Setup. We draft or review key operational contracts, prepare corporate governance documents (board manual, committee charters, data privacy manual), and set up compliance programs for SEC reportorial requirements, DOLE, BIR, and any industry-specific regulatory obligations applicable to your business.
5. Ongoing Corporate Legal Support. We provide continuing corporate legal support — acting as corporate secretary, filing annual SEC reports (GIS, AFS), preparing board and stockholder resolutions, advising on corporate governance issues as they arise, and representing the company in regulatory inquiries from the SEC, BIR, DOLE, or other government agencies.

Frequently Asked Questions