Frias, Janna Mari C.

2nd Year BSAIS

Business Laws 2 Atty. Regio

1. What is Corporation?

It is an artificial being created by operation of law, having the rights of succession and the
powers, attributes and properties expressly authorized by the law or incident to its existence.

2. What are the Characteristics of a Corporation?

 Limited Liability
 Separate Legal Existence
 Continuous Life
 Ability to Acquire Capital through issuances of stocks.
 Transferability, wherein they can dispose their shares by selling their stocks.
 Professional Management, they have board of directors and/or officers, executives.

3. Distinguish Corporation from Partnership.

Corporation Partnership
- It is owned by shareholders. - It is owned by partners who contribute
- Functions as a separate legal entity from resources, skills, and labor for the
its owners. purpose of dividing their profits.
- Distribution of earnings through - Minimum of 2 members and has no
dividends. maximum limit. (Indefinite)
- Has a Larger Capital and the ability to - Distribution of earnings in accordance to
acquire. their agreements.
- Limited Liability - They share their startup costs.
- Ability to sell their shares without consent - Unlimited liability
from other owners.
- Needs 5 people to begin and a maximum
of 15 people.

4. What is One Corporation and its Characteristics?

 One Corporation is a corporation with only one stockholder. It must be a person, who is at
legal age, a trustee, or an estate.
5. What are the salient features of the Revised Corporation Code as distinguished from the Old
Corporation Code?
Old Corporation Code
- Minimum of 5 Individuals to form a
corporation.
- A term limit of 50 years.
- Within 5 year period prior the original or
subsequent expiry dates of the corporate
term.
- Sworn Statement of Treasurer elected as
to minimum 25% subscription and as to
25% minimum paid up capital or P5,000,
whichever is higher.
Revised Corporation Code
- Removal of the absolute requirement of
having a minimum of 5 individuals in the
formation of corporations.
- The corporate term limit of 50 years has
been removed. A corporation can
perpetually exist.
- Empowerment of the SEC on the removal
of disqualified members of the Board of
Directors/Trustees.
- Within 3-year period prior the original or
subsequent expiry dates of the corporate
term.
- Filing of articles of incorporation and
applications for amendments thereto with
SEC in the form of electronic document.