You are on page 1of 22

DEPARTMENT OF TRADE AND INDUSTRY

Business Name Registration

What are the requirements/procedures in the registration of the business name?

For Sole Proprietorship:


Submit completely filled up New Application Form. The forms are available at the Information Counter
of the Business Registration Center, DTI Main Building, 361 Gil Puyat Ave., Makati City. Only the
owner of the business is authorized to sign all the forms.
1. The applicant must be a Filipino Citizen, at least 18 years old
2. Proof of Citizenship:
a. Natural born Filipinos whose names are suggestive of an alien nationality (e.g.
Chua,Taylor,etc.), submit photocopy of any proof of citizenship, such as, birth certificate,
voter's ID, PRC ID or passport and present original copies for comparison.
b. If owner is a Filipina married to a foreigner, submit photocopy of any proof of
citizenship, such as, birth certificate, voter's ID, PRC ID or passport plus photocopy of
the marriage certificate. Present original copies for comparison.

For Citizen of the Philippines by:


c. Naturalization-submit photocopy of naturalization certificate and oath of allegiance or
identification card issued by the Bureau on Immigration and Deportation. Present original
copies for comparison.
d. Election- submit photocopy of affidavit of election or identification card issued by the
Commission on Elections. Present original copies for comparison.

3. Verify nature of business.


Examples:
o Photocopy of license from DTI for Real Estate business. (Present original copy for
comparison)
o Photocopy of license from DTI for Fire Extinguisher business. (Present original copy for
comparison)
o Accreditation from DTI for Service and Repair Shop.
o Merchandise/Ship Broker license from DTI if business travel agency with ticketing as
nature of business. (Present original copy for comparison)
o License as General Bonded Warehouse if business is warehousing/storage of goods other
than grains.
2. Processing fee of P 300.00 plus P15.00 documentary stamps.

For Corporation / Partnership / Cooperative / Other Judicial Entities


1. Submit completely filled up new application form. (At least one of the incorporators may sign the
form or the board's authorized signatory)
2. Photocopy of the SEC/CDA certificates of registration and articles of
incorporation/partnership/cooperative, and that:

For corporation, the corporate secretary should certify true copy each page of the SEC certificate
of registration and articles of incorporation.
For partnership, one of the partners should certify true copy each page of the SEC certificate of
registration and articles of partnership.
For cooperative, the cooperative secretary should certify each page of the CDA certificate of
registration and articles of the cooperative.
3. Board Resolution/Partnership agreement for the authorized signatory, if signatory is not one of
the incorporators/partners; and,
4. Processing fee of P 500.00 plus P 15.00 documentary stamps.

For Corporations registering an adopted Business Name:


1. Same requirements stated above; and, 2. Board Resolution for the registration of an adopted name

For Franchise Holders


• Consent Certification from Franchisor
• Photocopy of the business name certificate of the franchisor; and,
• Basic requirements in filing an application for the registration of the business name.

Questions:

Who can apply for a Business Name?


Any natural person who is at least 18 years old (must be a Filipino citizen) or any juridical person who is
not disqualified by any existing law or regulations to engage in business and who is using a firm name,
business name or style. Corporations/Partnerships registered with Securities and Exchange Commission
(SEC) using only such corporate/partnership name, may no longer register under the Business Name Law.

Is Business Name registration required?

Under the Business Name Law, sole proprietors must be registered with the Department of Trade and
Industry. For valid reasons, a corporation, which may want to adopt a business name or style, must be
duly registered with DTI.

Where can I get the application forms?

In DTI-NCR, the forms are available at the Information Counter of the Business Registration Center, DTI
Main Building, 361 Gil Puyat Ave., Makati City. (The business name application forms can also be
downloaded)

How long is the validity of my BN registration?

The Business Name registration is renewable every 5 years. Such renewal should be made within the 90
days grace period following the expiration of the 5-year period from the date of the original registration.
The Business Name is automatically deleted from the computer files 6 months after the date of expiration
and after publication of such in leading newspapers. If applicant registers after 6 months after the date of
expiration, his/her application is considered as a new application.

Early renewal or renewal before the expiration date is not allowed.

Do I still need to register the branches of my business?

Yes, a business name registration is valid only at the business address stated in the Business Name
certificate. Hence, the main business and all the branches must be individually and separately registered
with their corresponding application.

What are the requirements for registering a Branch?


Basic requirements of business name application plus photocopy of business name certificate of Main
Office.

Is there a minimum required capitalization for opening up a business?

A realistic amount of capital sufficient to run the business is strongly recommended. However, there is a
minimum amount of capital required for certain lines of business.

• P5, 000,000 for financing company. (the form of business organization is always a corporation
and not sole proprietorship.)
• Lending Investors should now be registered as a corporation with the SEC first.
• P100,000 for pawnshop for sole proprietorship
• P1,000,000 for sole proprietorship or a partnership for overseas placement; P1,000,000 paid up
capital for corporation

Is there a need for a Corporation/Partnership/Cooperative to register with DTI?

Under the Business Name Law, registration of names of corporations, partnerships, cooperatives with
DTI is optional, if they use their regular corporate name, as they are already registered with either
Securities and Exchange Commission (SEC) or the Cooperative Development Authority (CDA). But if
they use an adopted name, they are required to register with DTI.

Can a natural person or sole proprietorship use the word "corporation" or "incorporated" as part
of his business name? How about company?

No, only a partnership or corporation registered with SEC can use the word "company" or "corporation"
as part of their business name.

Can anyone sign in behalf of the owner in the Business Name application?

No, unless one has a Special Power of Attorney (SPA) authorizing him/her to sign in behalf of the owner.
In case of a partnership/corporation, who is authorized to sign the application?
One of the partners/incorporators or corporate secretary duly authorized by the Board of Directors
through a Board Resolution.
Is it possible to have more than one business name?

YES.

SEC REGISTRATION REQUIREMENTS

Stock Corporations

Basic Requirements

1. Name Verification Slip (secure online or from SEC Name Verification Unit)
2. Articles of Incorporation and By-Laws
3. Treasurer's Affidavit
4. Affidavit of incorporator or director undertaking to change corporate name (not required if
Articles of Incorporation has provision on this commitment)
5. Registration Data Sheet
Additional Requirements
6. Endorsements/clearances from other government agencies, if applicable.
7. For corporations with foreign equity, submit Proof of Remittance by non-resident aliens and
foreign corporate subscribers who want to register their investment with Bangko Sentral ng
Pilipinas ( BSP )
8. For corporations with more than 40% foreign equity, submit Application Form F- 100
minimum of US$200.000.00 paid-capital is required.
9. If the primary purpose is custom brokerage, at least two (2) directors or officers must be
custom brokers, submit copies of their PRC license
10. Additional requirements based on kind of payment of subscription indicated hereunder

a. Cash

1. Bank Certificate of deposit of paid up capital notarized in place where executed


2. Proof of remittance or bank certificate ( only for those corporations with foreign
subscribers who want to register their investment with the BSP )
b. Land and/ Building/Condominium Units

1. Detailed schedule of the property showing its registered owner, location, area, TCT
No., Tax declaration number and the basis of transfer value ( market value /
assessed value / Zonal value or appraised value )
2. Copy (ies) of TCT/CCT and tax declaration sheet(s) certified by Register of Deeds
and Assessor's Office respectively
3. Latest zonal valuation certified by BIR , if transfer value is based on zonal value
4. Appraisal report by a licensed real estate appraiser, if transfer value is based on
appraised value ( not more than 6 months old )
5. Deed of assignment with primary entry by Register of Deeds
6. If property is mortgaged, submit mortgagee/creditor's certification on the
outstanding loan balance and his consent to the transfer of property
7. For assignment of buildings where assignor is not the owner of the land, submit the
lease contract on the land and consent of the land owner to the transfer

c. Inventories / Furniture / Personal Properties

1. Detailed schedule of the property showing its description and the basis of transfer
value ( market value or book value )
2. Special audit report by an independent CPA on the verification and valuation of the
property
3. Deed of assignment of property to the corporation

d. Heavy Equipment and Machinery

1. Detailed schedule of the property showing its description and the basis of transfer
value ( book value or appraised value )
2. Appraisal report by a licensed mechanical engineer (not more than 6 months old).
If the property is imported, valuation report by the Bangko Sentral ng Pilipinas
should be submitted instead
3. Deed of assignment of property to the corporation
e. Shares of Stock

1. Detailed schedule of the shares of stock indicating the stockholder, stock certificate
number, no. of shares and the basis of transfer value ( market value or book value )

2. Audited financial statements of the investee company as of the last fiscal year duly
stamped received by BIR and SEC

3. Deed of assignment of the shares of stock to the corporation

4. Certification by the Corporate Secretary of the investee company that the shares
are outstanding in the name of the assignor

5. Photocopy(ies) of the stock certificates (present original for verification)

6. Latest market quotation in the newspaper or certification from the stock


exchange/broker as to the latest market price of the shares of stock ( if same are
listed in the stock exchange)

f. Motor Vehicles

1. Detailed inventory of the motor vehicles showing the registered owner, make/model,
plate number, chassis number, motor number, certificate of registration number, and
market value
2. Photocopy of the Certificate of Registration and official receipt of annual registration
fee (present original for verification)
3. Appraisal report by a licensed mechanical engineer (not more than 6 months old)
4. Deed of assignment of the motor vehicle to the corporation

g. Sea Vessel / Aircraft

1. Detailed inventory of the vessel/aircraft showing the registered owner, registry


number, technical description, and appraised value
2. Certified true copy of the certificate of ownership
3. Certificate of seaworthiness / airworthiness issued by appropriate government
agency
4. Appraisal report by a licensed mechanical engineer (not more than 6 months old)
5. Deed of assignment of the vessel/aircraft to the corporation

h. Intangibles

1. Copy of the mining permit (for mining claims/rights )


2. Appraisal report by an accredited appraisal company (not more than 6 months old)
3. Deed of assignment of intangibles to the corporation

i. Net Assets (By Way of Conversion of Single Proprietorship/Partnership into


Corporation or By Way of Spin-Off)

1. Articles of Dissolution of Partnership


2. Audited financial statements of the single proprietorship/partnership/division of a
corporation (for spin off) as of the last fiscal year
3. Long-form audit report of item no. 2
4. Deed of assignment of the assets and liabilities to the corporation
5. Separate deed of the assignment for land with primary entry by Register of Deeds
6. List of creditors with the amount due to each of them and their consent certified by
the company accountant
7. Detailed schedule of the properties with certificate of registration/titles and their
respective book values
8. Photocopy(ies) of the certificate of registration of the motor vehicle (present original
for verification)
9. Copy(ies) of TCT/CCT and tax declaration sheet(s) certified by the Register of Deeds
and Assessor's Office, respectively
10. DTI Certificate of Registration ( for single proprietorship )

Note :

1. Item nos. 5 to 10 shall be complied with only if the same are applicable
2. Corporation should use the name of the partnership dropping only the word
"company" and adding either the words "corporation" or "incorporated" or their
abbreviation.

3. Filing of Articles of Dissolution and Articles of Incorporation or Increase of


authorized capital stock should be simultaneous.

Merger/Consolidation
1. Articles of Merger/Consolidation
2. Plan of Merger
3. List of stockholders of the constituent corporations before the
merger/consolidation, and list of stockholders of record of the surviving
corporation after the merger/consolidation, certified by the corporate secretary
4. Certification, under oath, by the corporate secretary, on the meetings of
the directors and stockholders of the constituent corporations approving the
merger/consolidation
5. Audited financial statements of the constituent corporations as of a date
not earlier than 120 days prior to the date of filing of the application in
accordance with PFRS 3 ( Accounting Standard on Business Combination)
6. For absorbed corporations: Long-form audit report of item 5
7. List of creditors, if any
8. Where both or all the constituent corporations are solvent: Certification,
under oath, by the president, chief finance officer or treasurer, that creditors have
been properly notified of the proposed merger/consolidation
9. Where at least one of the constituent corporations is insolvent: Affidavit
of publication in a newspaper of general circulation of the proposed
merger/consolidation

Note
1. If the surviving corporation will not issue shares of stock or
create additional paid-in Capital: Disregard item 5
2. If the merger will be effected via increase of capital stock:
Submit also the requirements for Increase of Authorized Capital Stock
3. For consolidation: Submit also the requirements for the
registration of a stock corporation
Non-Stock Corporation

Basic Requirements
1. Name verification slip
2. Articles of Incorporation and By-laws
3. Affidavit of an incorporator or director undertaking to change corporate name
4. List of members, certified by the Corporate Secretary
5. List of contributors and amount contributed certified by the treasurer

Note: Items 3, 4, and 5 need not be submitted if already stated in the Articles of Incorporation
Additional Requirements

6. For Foundations: Notarized Certificate of Bank Deposit of the contribution of not less
than P1,000,000.00; and Statement of willingness to allow the Commission to conduct an
audit
7. For religious corporations: Refer to Sections 109-116 of the Corporation Code of the
Philippines, and add an affidavit of affirmation or verification by the chief priest, rabbi,
minister or presiding elder
8. For federations: Certified list of member-associations by corporate secretary or president
9. For condominium corporations/associations: Master Deed with primary entry of the
Register of Deeds and certification that there is no other existing similar condominium
association within the condominium project
10. For neighbourhood associations: Certification from the Housing and Land Use
Regulatory Board (HLURB) that there is no other existing homeowners’ or similar
association in the community where the association is to be established

For Partnership

I. Amended Articles of Partnership (to change partnership name)


1. Name Verification Slip
2. Amended Articles of Partnership
3. Affidavit of a partner undertaking to change partnership name
4. Endorsement/clearance from other government agencies, if applicable
5. Company Data Maintenance Form
II. Amended Articles of Partnership (to change partners)
Submit the Amended Articles of Partnership and a separate Deed of Assignment of
partnership interest, letter of withdrawal of partner or affidavit of death of partner, and
Registration Data Sheet
III. For Other Amendments
1. Amended Articles of Partnership
2. Company Data Maintenance Form
IV. Dissolution of Partnership
1. Articles of Dissolution
2. BIR tax clearance

PHILIPPINE BOARD OF INVESTMENTS (BOI)

The Philippine Board of Investments (BOI), an attached agency of Department of Trade and Industry
(DTI), is the lead government agency responsible for the promotion of investments in the Philippines.
Taking the lead in the promotion of investments, BOI assists Filipino and foreign investors to venture and
prosper in desirable areas of economic activities. Investors are welcome to experience the potentials of
the booming Philippine Industry sectors. Profitable business opportunities abound in the food processing,
construction, metal products, telecommunications, power and infrastructure projects among others.

GUIDELINES/PROCEDURES FOR REGISTRATION

UNDER BOOK 1 OF THE OMNIBUS INVESTMENTS CODE OF 1987


Executive Order No. 226

1. OFFICIAL FILING OF APPLICATION


An application is considered officially filed upon submission of two (2) sets of the following documents
and upon payment of the required filing/application fee (See Table 1).

• Prescribed application form (BOI Form 501) duly accomplished, signed by the authorized officer
and notarized;
• Project Report (See Project Outline)
• Supporting documents
2. Preparation of PROJECT EVALUATION report by the Project Evaluation and Registration Department
(PERD), including applicant’s publication of Notice of Filing of Application, BOI referral of the
application to concerned government/private sectors (e.g., Department of Finance, Department of Science
and Technology), and conduct of plant visit if necessary.

3. PRESENTATION by PERD of the project evaluation report to the BOI MANAGEMENT


COMMITTEE

4. ACTION on the application for registration is rendered by the BOI BOARD OF GOVERNORS.

5. TRANSMITTAL OF NOTICE OF BOARD ACTION


Preparation by PERD of letter advising the applicant enterprise, of the Board action:

• Letter of approval including the pre-registration requirements, if application is approved; or,


• Letter of the Board action, if the application is denied or decision is deferred.

If there is no request for waiver/amendment of the pre-registration or registration conditions, proceed to


Step No. 7.

6. PROCESSING OF ANY REQUEST of the applicant for waiver of pre-registration requirement(s), for
amendment of timetable/ terms and conditions of registration, etc:

• PERD evaluates the request


• PERD presents the request and its recommendations to the BOI Management Committee if
necessary.
• ACTION on the application for registration is rendered either by the BOI BOARD OF
GOVERNORS, or by the Executive Director of the Project Assessment Group (PAG) as delegated
by the Board.
• PERD prepares notice of BOI action on the request.

7. Applicant complies with the PRE-REGISTRATION REQUIREMENTS including payment of the


required registration fee. (See Table 2).

8. PERD prepares and issues CERTIFICATE OF REGISTRATION (CR).

SUPPORTING DOCUMENTS

1. Copy of Applicant’s DTI Certificate of Business Registration (if sole proprietorship) or


Securities and Exchange Commission (SEC) Certificate of Registration (if partnership or
corporation) including Articles of Incorporation/Partnership and By-Laws, amendments thereof
and copy of the updated SEC-General Information Sheet (GIS).
2. Copy of the enterprise’s Board Resolution authorizing its officer to transact, execute and sign in
behalf of the applicant enterprise.
3. Copy of clearances from proper authorities for waste disposal and emission control (if already
available).
4. Proof of the following may be required on case to case basis:
o Assured supply of major raw materials e.g., supply contract/agreement(s), contract
growing arrangement(s), etc.
o Assured market, e.g., copy of letter(s) of intent, purchase order(s), proforma invoice(s),
sales/marketing contract(s), supply contract/agreement(s), etc.
o Acquisition of equipment (if already acquired).
o Financial capacity of Principal Stockholders (e.g., Sworn Statement of Assets and
Liabilities and latest Income Tax Return)
5. Additional Requirement for existing enterprisesCopy of the Audited Financial Statements (AFS)
and Income Tax Return (ITR) for the past three (3) years, or for the period the enterprise has
been in operation if less than three (3) years:
6. Additional Requirements for specific investment areas/activities
Requirements indicated in the current year’s Investment Priorities Plan (IPP) and/or those that
the Board may require.

7. Other documents that may be required.

Table 1. Filing/Application Fees a

Project Cost b MSE Fees c Regular Fees


Classification
New/ Expansion
Micro Not exceeding P3 million Waived 1,500
Small Exceeding P3 million but not over P4 million 375 1,500
Exceeding P4 million but not over P15 million 750 3,000
Medium Exceeding P15 million but not over P 20 million Na 3,000
Exceeding P20 million but not over P 50 million Na 4,500
Exceeding P50 million but not over P 100 million Na 6,000
Large Over P 100 million Na 6,000
Existing Assets
Micro Not exceeding P3 million Waived 1,500
Small Exceeding P3 million but not over P15 million 375 1,500
Medium Exceeding P15 million but not over P 100 million Na 1,500
Large Over P 100 million Na 1,500

Table 2. Registration Fees

Project Cost b MSE Fees c Regular Fees


Classification
New/ Expansion
Micro Not exceeding P3 million Waived 1/10 of 1% of
Small Exceeding P 3 million but not over P 15 25% of 0.1% of project project cost,
million cost. But not less than but not less
P3,000. than P3,000;
Medium Exceeding P 15 million but not over P 100 Na and not to
million exceed
Large Over P 100 million Na P15,000.
Existing Assets
Micro Not exceeding P3 million Waived 3,000
Small Exceeding P3 million but not over P15 million 750 3,000
Exceeding P15 million but not over P 100
Na 3,000
million
Large Over P 100 million Na 3,000
a. There is additional fee for Legal Research Fund(LRF), equivalent to 1% of filing fee but not lower than
Php 20.00 as per P.D. 1856.
b. Project cost includes loan but excludes cost of land
c. Under the 2009 Investment Priorities Plan (IPP), Micro enterprises are exempted from payment of
application and registration fees. Small enterprises are entitled to seventy five percent (75%) reduction in
application and registration fees.
Reduced fees shall apply to projects that meet both of the following conditions, otherwise the regular fees
shall be applied:

o The enterprise satisfies the definition for MSEs under RA 9501 amending the Magna
Carta for Small Enterprises, as follows: Any business activity or enterprise engaged in
industry, agribusiness and/or services, whether single proprietorship, cooperative,
partnership or corporation whose total assets, inclusive of those arising from loans but
exclusive of the land on which the particular business entity’s office, plant and equipment
are situated, must have value falling under the following categories:

Micro: Not more than P 3,000,000


Small: P 3,000,001 to P 15,000,000

o The cost of the project proposed by the enterprise, exclusive of the cost of land on which
the particular business entity’s office, plant and equipment are situated, shall not exceed
fifteen million (Php15,000,000). Likewise, authorized capital shall not exceed fifteen
million (Php15,000,000).
` `

BANGKO SENTRAL NG PILIPINAS

BASIC GUIDELINES IN ESTABLISHING BANKS

A. GUIDING PRINCIPLE
The new banking organization must have suitable shareholders, adequate financial strength, a
legal structure in line with its operational structure, and a management with sufficient expertise
and integrity to operate the bank in a sound and prudent manner. Where the proposed owner or
parent organization is a foreign bank, the prior consent of its home country supervisor should be
obtained.

B. THE APPLICATION
1. The Application for Authority to Establish a Bank (For m No. 1) shall be accomplished in
triplicate. The original copy and duplicate copy shall be submitted to the Office of Supervisory
Policy Development, Bangko Sentral ng Pilipinas (BSP). The third copy shall be retained
by the organizers.
2. The required papers/documents and other information in support of the application are, as
follows:
a. “Agreement to Organize a Bank” (Form No. 2).
b. Accomplished bio-data sheet of each of the incorporators, proposed directors and
officers, and subscribers (Form No. 3). Except those to be established under R.A. No.
7721 which shall continue to be governed by Circular No.51 dated 14 October 1994, as
amended. The authority to operate as an expanded commercial bank, on the other hand,
may be granted only to a non -expanded commercial bank with satisfactory performance
for the last two (2) years preceding its application for such authority.
c. Evidence of Filipino citizenship of each of the incorporators, proposed directors and
officers, and subscribers if he/she claims to be a Filipino citizen.

1) In case of a natural-born Filipino citizen, original or certified true copy of birth


certificate from issuing office. In case the birth certificate cannot be produced
by reason of destruction or otherwise, an affidavit to that effect by the civil
registrar concerned should be submitted accompanied by an affidavit of the
incorporator, director, officer or subscriber himself stating, among other things,
the date and place of his birth and the names of his parents and their citizenship
at the time of the affiant’s birth; and joint affidavit of two (2)
disinterested/unrelated persons stating, among other things, the date and place of
the subject’s birth and the names of his parents and their citizenship at the
time of the subject’s birth; or
2) In case of a naturalized citizen of the Philippines, the naturalization certificate,
certificate of registration thereof with the civil registrar and other pertinent
papers; or
3) In the absence of the abovementioned documents, a photocopy of the passport

d. Statement of Assets and Liabilities as of a date not earlier than ninety (90) days prior to
the filing of application of each of the subscribers, sworn to by the subscriber himself and
duly notarized, or certified by a Certified Public Accountant, with supporting schedules
showing the following information:
1) In the case of cash in banks: (a) name of depository bank, (b) nature of
deposit, and (c) amount of deposit with each bank as of balance sheet date;
2) In the case of securities: (a) name and address of issuing corporation/entity, (b)
number of shares owned as of bal ance sheet date, (c) par value, (d) date and cost
of acquisition, and (e) information as to whether the securities are actively traded
in the stock market and, if so, their current market price;
3) In the case of land: (a) description (agricultural, etc); (b) area; (c) location; (d)
date and cost of acquisition; (e) transfer certificate of title or tax declaration
number; (f) amount of encumbrance or lien, if any; (g) assessed value; and (h)
current market value (state basis of valuation);
4) In the case of real estate improvements: (a) description of improvement
(residential house, etc.) (b) location; (c) date and cost of acquisition/construction;
(d) assessed value; and (e) current market value (state basis of valuation);
5) In the case of accounts receivable, state the name and address of each debtor
and the amount due from each; and
6) In the case of accounts payable or other liabilities, state the name and address
of each creditor and the amount owed to each.

C. CAPITAL REQUIREMENT/STOCKHOLDINGS

1. Banks to be established shall comply with the required minimum


capital enumerated below or as may be prescribed by the Monetary
Board:
Revised
Type of Bank Amounts
(In Million Pesos)
a. Universal Banks 4,950.0
b. Commercial Banks 2,400.0
c. Thrift Banks
- With head office within Metro Manila 325.0
- With head office outside Metro Manila 52.0
d. Rural Banks
- within Metro Manila 26.0
- Cities of Cebu and Davao 13.0
- In 1st, 2nd & 3rd class cities and 1st class municipalities
- In 4th, 5th & 6th class cities and in 2nd, 3rd & 4th class municipalities
- In 5th & 6th class municipalities 2.6
2. At least 25% of the total authorized capital stock shall be subscribed
by the subscribers of the proposed bank, and at least 25% of such subscription shall be paid-up,
provided that in no case shall the paidup capital be less than the minimum required capital stated
in Item 1above.
3. The Stockholdings of an individual, family, corporate or business group in any bank shall be
subject to the following limits:
a. Foreign individuals and non-bank corporations may own or control up to forty percent
(40%) of the voting stock of a domestic bank: Provided, That the aggregate foreign-
voting stocks owned by the foreign individuals and non-bank corporations in a domestic
bank shall not exceed forty percent (40%) of the outstanding voting stock of the bank.
The percentage of foreign owned voting stock in a bank shall be determined by the
citizenship of the individual stockholders in that bank.
b. A Filipino individual and a domestic non-bank corporation may each own up to forty
percent (40%) of the voting stock of a domestic bank. There shall be no aggregate ceiling
on the ownership by such individuals and corporations in a domestic bank.
c. The citizenship of the corporation which is a stockholder of a bank shall follow the
citizenship of the controlling stockholders of the corporation, irrespective of the place of
incorporation. For purposes hereof, the term “controlling stockholders” shall refer to
individuals holding more than fifty percent (50%) of the voting stock of the corporate
stockholders of the bank.
4. At least 60% of voting stock of any commercial bank shall be owned by Filipino citizens. For
any thrift bank, at least 40% of its voting stock shall be owned by Filipino citizens. Subject to
Section 4 of Republic Act. No. 7353, all of the capital stock of any rural bank shall be fully
owned and held, directly or indirectly, by Filipino citizens or corporations, associations or
cooperatives qualified under Philippine laws to own and hold such capital stock.

D. INCORPORATORS/SUBSCRIBERS, DIRECTORS AND OFFICERS


1. The incorporators /subscribers and proposed directors and officers must be persons of integrity
and of good credit standing in the business community. The subscribers must have adequate
financial strength to pay for their proposed subscriptions in the bank.
2. The incorporators/subscribers and proposed directors and officers must not have been
convicted of any crime involving moral turpitude, and unless otherwise allowed under the
provisions of existing laws are not officers and employees of a government agency,
instrumentality, department or office charged with the supervision of, or the granting of loans to
banks.
3. A bank may be organized with not less than five (5) nor more than fifteen (15) incorporators.
In case there are more than fifteen (15) persons initially interested in organizing and investing in
the proposed bank, the excess may be listed among the original subscribers in the Articles of
Incorporation.
4. The number of members of the board of directors of the bank shall not be less than five (5) nor
more than fifteen (15) and shall always be in odd numbers and at least two (2) of the directors are
“independent directors”. An independent director shall mean a person who –

a. Is not or has not been an officer or employee of the bank/quasibank/ trust entity, its
subsidiaries or affiliates or related interests during the past three (3) years counted from
the date of his election;
b. Is not a director or officer of the related companies of the institution’s majority
stockholder;
c. Is not a majority shareholder of the institution, any of its related companies, or of its
majority shareholder;
d. Is not a relative within the fourth degree of consanguinity or affinity, legitimate or
common-law of any director, officer or majority shareholder of the bank/quasi-bank/trust
entity, or any of its related companies;
e. Is not acting as a nominee or representative of any director or substantial shareholder
of the bank/quasi-bank/trust entity, any of its related companies or any of its substantial
shareholders; and,
f. Is free from any business or other relationship with the institution or any of its major
stockholders which could materially interfere with the exercise of his judgement, i.e., has
not engaged and does not engage in any transaction with the instituion, any of its related
companies or any of its substantial shareholders, whether by himself or with other
persons or through a firm of which he is a partner or a company of which he is a director
or substantial shareholder, other than transactions which are conducted at arms length and
could not materially interfere or influence with the exercise of his judgments.
5. At least two-thirds (2/3) of the members of the board of directors of any commercial
bank shall be Filipino citizens; at least a majority of the members of the board of
directors of any thrift bank shall be Filipino citizens; and all members of the board of
directors of a rural bank shall be Filipino citizens.
6. No appointive or elective public official, whether full-time or part-time shall at the
same time serve as officer of a commercial bank or a thrift bank except in cases where
such service is incident to financial assistance provided by the government or a
government-owned or –controlled corporation to the Bank.
7. The proposed directors and officers of the bank shall be subject to qualifications and
other requirements of existing laws, rules and regulations of the BSP, as follows:
a. Qualifications of a director. A director shall have the following minimum
qualifications:
1. He shall be at least twenty-five (25) years of age at the time of his
election or appointment;
2. He shall be at least a college graduate or have at least five (5) years
experience in business;
3. He must have attended a special seminar for board of directors
conducted or accredited by the BSP: Provided, That incumbent directors
as well as those who will be elected after the approval of this circular
must attend said seminar within a period of six (6) months from the date
of this circular or from the date of their election, as the case may be; and
4. He must be fit and proper for the position of a director of the
bank/quasi-bank/trust entity. In determining whether a person is fit and
proper for the position of a director, the following matters must be
considered:
- integrity/probity;
- competence;
- education;
- diligence; and
- experience/training .
For thrift banks and rural banks, at least one (1) of the members of the Board of
Directors must, in addition to the abovementioned minimum qualifications, have at least
one (1) year experience in banking and/or finance, provided that this requirement may be
waived if the thrift bank or rural bank is to be established in a municipality or city where
there is no existing bank. The foregoing qualifications for directors shall be in addition to
those already required or prescribed under existing laws.
b. Qualifications of an officer. An officer shall have the following minimum
qualifications:
1. He shall be at least twenty-one (21) years of age;
2. He shall be at least a college graduate, or have at least five (5) years
experience in banking or trust operations or related activities or in a
field related to his position and responsibilities, or have undergone
training in banking or trust operations acceptable to the appropriate
supervising and examining department of the BSP: Provided,
however, That trust officers shall have at least two (2) years of actual
experience or training in trust operations or fund management or other
related fields;
3. He must be fit and proper for the position he is being
proposed/appointed to. In determining whether a person is fit and proper
for a particular position, the following matters must be considered:
- integrity/probity;
- competence;
- education;
- diligence; and
- experience/training.

For commercial banks, the President mus t, in addition to the abovementioned minimum
qualifications, have at least two (2) years experience in banking and/or finance. For thrift
banks and rural banks, any one of the President, Chief Operating Officer or General
Manager must, in addition to the abovementioned minimum qualifications, have at least
two (2) years experience in banking and/or finance. The foregoing qualifications for
officers shall be in addition to those already required or prescribed
under existing laws.
E. REQUIREMENTS FOR THE ISSUANCE OF AUTHORITY TO OPERATE

1. Proof of registration of Articles of Incorporation and By- Laws;


2. Certification of compliance with the conditions of approval duly signed by the incorporators;
3. List of principals and junior officers and their respective designations and salaries;
4. Bio-data sheet, evidence of citizenship and NBI and BIR clearances of each of the officers
5. Chart of Organization
6. Manual of Operations embodying the policies and operating procedures of each department/
unit/ office, covering such areas as signing/delegated authorities, etc.
7. Plantilla showing the positions with corresponding salaries, the total of which should more or
less conform with the amount of salaries shown in the submitted projected statement of earnings
and expenses;
8. Two (2) sets of specimens of principal bank accounting and other forms;
9. Bond policy on officers and custodial employees;
10. Insurance policy on bank properties required to be insured;

F. INAUGURATION/OPENING OF THE BANK FOR BUSINESS AFTER THE CERTIFICATE OF


AUTHORITY TO OPERATE HAS BEEN ISSUED.

G. REQUIREMENTS WITHIN 30 DAYS AFTER FIRST DAY OF OPERATIONS


1. Inform the BSP of the first day of operation and the banking hours and days; and
2. Submit a Statement of Condition as of the first day of operation.

H. REVOCATION OF AUTHORITY TO ESTABLISH A BANK


The authority to establish a bank shall be automatically revoked if the bank is not organized and opened
for business within six (6) months (for commercial banks and thrift banks) and eight (8) months (for
rural banks) after receipt by the organizers of the notice of approval by the Monetary Board/Governor of
their application. Extension may be granted upon presentation of justifiable reason for failure to open the
bank within the prescribed period, and proof that the bank can be opened within the extension period.

BSP (http://www.bsp.gov.ph/regulations/guidelines.asp)