Legislative History

The earliest forms of commercial companies, associations, and partnerships were encompassed
in the Code of Commerce which became effective on December 1, 1888. Among these were
sociedad en comandita, sociedad regular collective, sociedad anomina, and sociedad de
cuentas en participacion. The concepts of sociedad en comandita or limited partnership and
sociedad regular collective or general partnership can be found on Articles 116 to 150 and 160
to 174 respectively. Sociedad anomina was governed by Articles 151 to 159. While, sociedad de
cuentas en participacion or joint account participation can be found on Articles 239 to 243 of
the Code of Commerce.

Next piece of legislation is the Philippine Bill of 1902. The Philippine bill of 1902 was approved
on July 1, 1902 after the Philippine Islands passed to the sovereignty of the United States.
Under this bill, the Congress of the United States inserted certain provisions to control the law-
making power in the Philippines as to granting franchises, privileges and concessions. One
particular amendment to the law is the provision stating that “it shall be unlawful for any
member of a corporation to engage in agriculture or mining and for any corporation organized
for any purpose except irrigation.”

On March 1, 1906, Act No. 1459 and the New Civil Code were enacted. Consequently, the
former Corporation Law was the first corporate statute in the Philippines. Under this law, all
societies and associations were abolished except sociedad de cuentas en participation. It also
provided for the organization of corporation in the Philipppines.

The Corporation Code of 1980 or Batas Pambansa Blg. 68 was enacted and laid down the
creation of government corporations and those governing or relating to special types of
corporation. Similarly, numerous statutes were enacted such General Banking Act, Rural Banks
Acts, Investment Company Act, Saving and Loans Association Act, Private Development Banks
Acts, Financing Company Act, Investment Houses Law, Pawnshop Regulation Act, and the
Insurance Code. The Code also included corporation doctrines enunciated by the Supreme
Court and clarified the obligations of corporate directors and officers.

De Leon, H. & De Leon, H. Jr. (2013) The corporation code of the Philippines. Rex Bookstore.