One Person Corporation (OPC) in the Philippines

The One Person Corporation (OPC) in the Philippines, introduced under the Revised Corporation Code (RCC) in 2019, is a business structure that allows a single individual, trust, or estate to form a corporation without the need for multiple shareholders or a board of directors. This structure is particularly beneficial for both local and foreign entrepreneurs who wish to establish a business in the Philippines, offering a blend of the agility of a sole proprietorship with the limited liability of a corporation[1][2][3].

Key Features of the OPC

• Single Shareholder Structure: An OPC can be formed by a natural person, trust, or estate, acting as the sole shareholder, director, and president of the corporation. This setup provides complete control over business decisions without the need for consensus from other shareholders or a board of directors[1][2][3].

• Limited Liability: The OPC structure ensures that the shareholder's liability is limited to their capital contribution, protecting personal assets from corporate debts and obligations. This is a significant advantage over sole proprietorships, where personal assets can be at risk[4][5].

• No Minimum Capital Requirement: There is no mandatory minimum capital requirement for forming an OPC, making it accessible for small and medium-sized enterprises (SMEs) and startups[1][3][5].

• Perpetual Existence: Unlike traditional corporations that had a limited lifespan, OPCs can exist perpetually unless otherwise specified in their Articles of Incorporation[1][4].

Foreign Ownership and Restrictions

Foreign nationals are allowed to establish an OPC in the Philippines, with the possibility of owning up to 100% of the corporation. However, this is subject to the Foreign Investment Negative List (FINL), which outlines specific industries where foreign ownership is restricted or prohibited. These restrictions are in place to protect certain sectors deemed critical to national interests[2][3][6].

Registration and Compliance

To set up an OPC, the incorporator must register with the Securities and Exchange Commission (SEC), providing necessary documents such as the Articles of Incorporation and appointing a nominee and alternate nominee. These nominees are responsible for managing the corporation in the event of the shareholder's death or incapacity[1][2][3].

OPCs are also required to comply with various reportorial requirements, including submitting annual audited financial statements and disclosing related party transactions. These compliance measures ensure transparency and accountability in corporate operations[2][7].

Conclusion

The OPC framework in the Philippines offers a streamlined and flexible option for both local and foreign entrepreneurs to establish a business. By combining the benefits of limited liability and full control, the OPC is an attractive vehicle for small and medium enterprises looking to enter or expand in the Philippine market. However, potential investors must consider industry-specific restrictions and ensure compliance with regulatory requirements to fully leverage this corporate structure[1][3][5].

Citations:
[1] https://philippinesbusinessregistration.com/company-registration/one-person-corporation/
[2] https://barrozolaw.com/one-person-corporation-a-unique-corporate-vehicle/
[3] https://emerhub.com/philippines/one-person-corporation-philippines-guide/
[4] https://www.filepino.com/pros-cons-in-setting-up-an-opc-in-the-philippines/
[5] https://emerhub.com/philippines/legal-entity-types-in-the-philippines/one-person-corporation-in-the-philippines/
[6] https://www.healyconsultants.com/philippines-company-registration/one-person-corporation/
[7] https://saklawph.com/opc/
[8] https://www.linkedin.com/pulse/one-person-corporation-opc-philippines-gateway-local-foreign-ph-bi4jc