By Arra B. Francia, Senior Reporter
THE Securities and Exchange Commission (SEC) has revised the guidelines on corporate names to reflect changes in the Revised Corporation Code, particularly on the formation of one person corporations (OPC).
In a notice posted on its website, the SEC said Memorandum Circular No. 13 Series of 2019 covers the amended guidelines and procedures on the use of corporate and partnership names.
“To keep abreast with developments in business and information technology in the country, the commission is adopting the following guidelines and procedures in the registration of corporate, one person corporate, and partnership names,” according to the memorandum.
For the first item, the commission added a provision requiring OPCs to add the word “OPC” either below or at the end of its corporate name.
The memorandum also states that the stockholder of an OPC may use his/her name for the name of the company, provided that this will be accompanied with descriptive words aside from the suffix OPC.
“The single stockholder may also use the name of another person provided consent was given by the said person or if deceased, his estate. Provided that the name shall be accompanied by the descriptive words other than the suffix OPC.”
This is in line with Section 10 of the Revised Corporation Code or Republic Act No. 11232, which took effect on Feb. 23, stating that a corporation may consist of a single stockholder.
The commission also revised how companies may use names of corporations whose registrations have already been revoked. The new guideline allows companies to use the name of a corporation whose registration was canceled five years after its dissolution, as opposed to the previous rule that only allowed such event for “meritorious cases as determined by the Commission en banc.”
“The name of a corporation or partnership that has been dissolved or whose registration has been revoked shall not be used by another corporation or partnership within five years from the approval of dissolution or five years from the date of revocation, unless its use has been allowed at the time of the dissolution or revocation…”
It also removed the old rule that allowed only expired corporations to apply for re-registration using the same corporate name.
The commission further noted that a corporate or partnership name that has previously been used shall not be re-registered or used by another corporation or partnership for a period of three years from the date of the approval of the adoption of the new name.
Companies, however, may shorten this time frame by securing the consent of the company that previously held the corporate or partnership name. The consent should come in the form of a director’s or trustee’s certificate approved by majority of the directors or trustees of previous company.
For a partnership, majority of the partners must approve a resolution allowing the use of the name.