FOREIGN

CORPORATIONS
Reported by:
Vinalou G. Vizcocho

Foreign Investments how made

By establishing a domestic branch office or operation;
By establishing a Philippine representative office;
By operating through a business association in the

Philippines;
By operating through a local subsidiary which may be
owned entirely or partially by the foreign business entity;
By establishing joint venture arrangement with a local
corporation or business organization;
Establishing an affiliate in the Philippines.

Section 123
Definition and rights of foreign corporations
One formed, organized or existing under any laws other than

those of the Philippines and whose laws allow Filipino

citizens and corporations to do business in its own country or
state.
It shall have the right to transact business in the Philippines

after it shall have obtained a license to transact business in

this country.

Section 124
Application to existing foreign corporations
Authorized to do business in the Philippines under a

license issued to it shall continue to have such authority

under the terms and conditions of its license, subject to
the provisions of the Corporation Code and other special
laws.

Section 125
Application for a license
Shall submit to the SEC a copy of its:
articles of incorporation and by-laws;
certified in accordance with law;
Translation to an official language of the Philippines (if necessary).
Shall be under oath
Shall specifically set forth the following unless already stated in its articles of

incorporation:

Date and term of incorporation;

Address of the principal office in the country;
Name and address of its authorized resident agent;
Place in the Philippines where the corporation intends to operate;
Specific purpose;
Names and addresses of the present directors and officers of the corporation;
Statement of its authorized capital stock and the aggregate number of shares;
Statement of its outstanding capital stock and the aggregate number of shares;
Statement of the amount actually paid in;
Additional information as may be necessary or appropriate.

Section 126 Issuance of a license

Applicant has complied with all the requirements of this

Code and other special laws, rules and regulations

SEC shall issue a license to the applicant to transact business in

the Philippines for the purpose or purposes specified in the license

Within 60 days after the issuance of license, the licensee

shall deposit with SEC securities consisting of bonds or

other evidence;

Section 127
Who may be a resident agent
An individual residing in the Philippines or domestic

corporation
Philippines:

lawfully

transacting

business

in

the

Provided, that in the case of an individual, he must be of good

moral character and of sound financial standing.

Section 128
Resident Agent; Service of Process
Written power of attorney designating some person who

must be a resident of the Philippines

Any summons and other legal process may be served in all actions or

other legal proceedings against the corporation;

Consenting that service shall be admitted and held as valid as if served
upon the duly authorized officers of foreign corporation at its home
office.

Section 129 Law applicable

Bounded by all laws, rules and regulations applicable to

domestic corporations of the same class.

Section 130
Amendments to articles of incorporation or
by-laws of foreign corporations
60 days after such amendment becomes effective, the

foreign corporation shall file with SEC, and in the proper

cases with the appropriate government agency, a duly
authenticated copy of the amended articles of
incorporation and by-laws.

Section 131 Amended license

A foreign corporation shall obtain an amended license:
In the event it changes is corporate name; or
Desires to pursue other or additional purposes.

Section 132
Merger or consolidation involving a foreign
corporations licensed in the Philippines
Permitted under Philippine laws and by the law of its

incorporation
Provided, that the requirements on merger or consolidation are

followed

60 days after such merger or consolidation becomes

effective:
File with SEC the copy of articles of merger or consolidation duly

authenticated by the proper official or officials of the country

The absorbed corporation doing business in the Philippines shall file a

petition for withdrawal of its license.

Section 133
Doing business without license
Shall not be permitted or intervene in any action, suit or

proceeding in any court or administrative agency of the

Philippines
May be sued or proceeded against before the Philippine

courts or administrative tribunals on any valid cause of

action recognized under the Philippine Law.

Foreign Corporation right to sue:

Whether a foreign corporation is possessed of the right to

sue in the Philippines is determined as follows:

1.

If the foreign corporation is transacting or doing business in the

Philippines with a license, it has the right to sue within the
jurisdiction of the Philippines;

2.

If it is transacting or doing business without license, it cannot sue;

3.

If it is not transacting or doing business in the Philippines, it can

sue even if it is not possessed of any license.

Foreign Corporation right to be sued

A foreign corporation may be sued in the Philippines:
1.

If it is transacting or doing business in the Philippines with a

license;

2.

If it is transacting or doing business in the Philippines without

license;

Note: if it is not transacting or doing business in the Philippines and

does not have any license to so transact or do business in the
Philippines, it cannot be sued in the Philippines for lack of jurisdiction.

Section 134 Revocation of license

Failure to file its annual report or pay any fees;
Failure to appoint and maintain a resident agent in the Philippines;
Failure to submit to SEC an authenticated copy of amended articles of

incorporation or by-laws or articles of merger or consolidation within the

prescribed period;
Misrepresentation of any material matter in any application, report, affidavit

or other document submitted;

Failure to pay any and all taxes;
Transacting business outside of the purpose or purposes;
Transacting business as agent of or acting for and in behalf of any

unlicensed foreign corporation or entitiy;

Any other ground.

Section 135
Issuance of certificate of revocation
SEC shall issue a certificate of revocation furnishing the

appropriate government agency in the proper cases.

SEC shall also mail the corporation at its registered office

in the Philippines a notice of revocation accompanied by a

copy of the certificate.

Section 136
Withdrawal of foreign corporation
All claims which have accrued in the Philippines have

been paid, compromised or settled;

All taxes, imposts, assessments, and penalties, lawfully

due have been paid;

Petition for withdrawal of license has been published once

a week for three consecutive weeks in a newspaper of

general circulation in the Philippines.