1.

Different Business Structures (Philippine Setting) -discuss each

There are several types of business structures to choose from in establishing operations
in the Philippines.

● Sole Proprietorship

You should set up your company in this way if you want total control and
authority. A sole proprietorship signifies that one individual is the sole owner of
the business and all of its assets. You get to take advantage of all the gains while
also bearing the brunt of all the possible losses, making this an apples-to-apples
scenario. Some examples of this are general merchandise stores, small retail
establishments, and ready-to-wear (RTW) shops, etc. And foreigners are not
allowed to own a business in the Philippines solely.

● Partnership

Article 1767 of the Philippine Civil Code provides a clear definition of a

Partnership: “By the contract of partnership two or more persons bind themselves
to contribute money, property, or industry to a common fund, with the intention of
dividing the profits among themselves.” Additionally, it's also important to keep in
mind that, according to the Philippine Civil Code, the Partnership's legal identity
is separate from any or all of its owners. It is viewed as a separate legal entity, in
other words. Moreover, together with your business partners, you might create a
general partnership, which entails unlimited liability for the debts, gains, and
obligations of the business. Or a limited partnership, where only a small
number of partners have unrestricted liability and the other partners are only
responsible for their capital contributions. Lasty, must register the partnership
with the Securities and Exchange Commission if the capital is greater than
P3,000.00 (SEC). And in a partnership, the Philippines permits foreigners to own
up to 40% of the business.
● Corporation

The Securities and Exchange Commission regulates corporations, which

are legal entities with separate and distinct personalities from their stockholders
that are created under the Corporation Code. A corporation's shareholders are
only liable for the amount of their share capital. It is composed of between five
and fifteen (15) incorporators, each of whom must be registered with the
Securities and Exchange Commission and possess a minimum of one share
(SEC). Minimum paid-up capital: 5,000 pesos ( 5,000.00). Apart from this, a
corporation is treated as a separate legal entity from any or all of its
shareholders/stockholders, similar to how a partnership is. There are two
different kinds of businesses; the first is a stock corporation, which has a capital
that is dispersed as shares to investors. The non-stock corporation is the
second category and operates without issuing shares in order to further its
charitable, educational, or cultural objectives.

Furthermore, regardless of nationality, a corporation can be either a stock or

non-stock entity. Such a company is regarded as a Filipino corporation if it has
60% Filipino and 40% foreign ownership; if it has more than 40% foreign
ownership, it is regarded as a foreign-owned corporation.

● One-Person Corporation

Others may be curious as to whether it is feasible to form a corporation

that is made up of only one person. Yes, it is the answer. The One Person
Corporation (OPC) was introduced in February 2019 by Republic Act No. 11232,
also known as the Revised Corporation Code of the Philippines (RCC). An OPC
may only be registered by a natural person, trust, or estate. However, the
incorporator must always be a natural person who is of legal age. The
incorporator can be the trustee, administrator, or any other person exercising
fiduciary duties in the case of a trust or an estate.

Moreover, an OPC establishes an administrative framework that preserves the

advantages of both a sole proprietorship and a corporation, i.e., limited liability
and total control. Because an OPC differs from a sole proprietorship in that it has
a personality of its own, the stockholder's liability is constrained to the amount of
capital invested.