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MISCELLANEOUS

PROVISIONS
Sections 138-149
Section 138. Designation of
Governing Boards
The provisions of specific provisions of this Code to the
contrary notwithstanding, non-stock or special corporations may,
through their articles of incorporation or by their by-laws,
designate their governing boards by any name other than as
board of trustees.
This authority to designate only refers to non-stock
corporations and special corporations
This provision accommodates the practice of various non-
stock corporations of calling their governing body by any
name other than board of trustees.
Example: Board of Regents, Board of Governors
Section 139. Incorporation
and other fees
The Securities and Exchange Commission is hereby
authorized to collect and receive fees as authorized by law or by
rules and regulations promulgated by the Commission.
SEC is authorized to collect and receive fees as authorized by
the following laws:
P.D. No. 902-A
R.A. No. 1143
R.A. No. 3531
R.A. No. 3531
B.P. bilang 178
Section 139. Incorporation
and other fees
The SEC collects fees, among others, for examining and filing
articles of incorporation and the by-laws, and amendments
thereto, certificates of increase or decrease of the capital
stock, or certificates incurring, creating, or increasing bond
indebtedness; for granting exemption of securities from its
registration requirements, etc.
The corporation fee is not a tax and the legislature, by its
imposition, does not impliedly divest itself of powers of taxing
a corporation.
SEC is authorized to recommend to the President the
revision, alteration, amendment, or adjustments of the fees
Section 140. Stock ownership
in certain corporations

This section obligates the NEDA to determine from time to


time whether the corporate form of organization has been
used to circumvent the provisions in the Constitution
prescribing limits to ownership and management of certain
corporations. (Par.1)
NEDA is required whenever necessary to submit to Congress
a report of its findings including recommendations for their
prevention or correction.
The Constitutional provisions referred to are Sections 2, 3, 9,
10, 11 and 19 of Article XII; Section 4(2) of Article XIV; and
Section 11 or Article XVI.
Section 140. Stock ownership in
certain corporations
Congress may set maximum limits for stockholdings in
corporations declared by it to be vested with public interest
upon the recommendation of NEDA, belonging to individuals
or group of individuals related to each other by consanguinity
or affinity or by close business interests, or whenever
necessary to achieve national objectives, prevent illegal
monopolies or combinations in restraint of trade, or to
implement national economic policies.
Section 19, Article XII states that:
The State shall regulate or prohibit monopolies when the
public interest so requires. No combinations in restraint of trade
or unfair competition shall be allowed.
Section 141. Annual report of
corporations
The presumption is that this section applies only to STOCK
CORPORATIONS, either DOMESTIC or FOREIGN because of the
clause LAWFULLY DOING BUSINESS IN THE PHILIPPINES.
Such Corporations are required to submit to SEC an ANNUAL
REPORT of its operations, together with financial statement of
it assets and liabilities.
The report should be certified by any independent certified
public accountant in appropriate cases, covering the preceding
fiscal year and such other requirements as SEC may require.
It should be submitted within such period as may be
prescribed.
Section 142. Confidential
nature of examination results
All interrogatories propounded by the Securities and
Exchange Commission and the answers thereto, as well as the
results of any examination made by the Commission or by any
other official authorized by law to make an examination of the
operations, books and records of any corporation, shall be kept
strictly confidential, except insofar as the law may require the
same to be made public or where such interrogatories, answers
or results are necessary to be presented as evidence before any
court.
Right of Visitation is the power of the State through the
proper governmental agency to examine the business affairs,
administration and condition of corporations.
Section 142. Confidential nature
of examination results
By special laws, the following, among others, have been granted
visitorial powers which they may exercise motu propio or upon
complaint of a party-in-interest:
SEC
BIR
Insurance Commission
Bangko Sentral ng Pilipinas
National Telecommunications Commission
DOLE
Commission on Audit
National Housing Authority
Section 142. Confidential nature
of examination results
GENERAL RULE:
Courts will refrain from interfering with the internal management
of a corporation. It will not do so at the instance of minority stock
AS LONG AS those in control are acting honestly and within their
discretionary powers
EXCEPTION:
Abuse of discretion
Act is forbidden by law
Act is against public policy
Ultra vires acts
fraud upon minority stockholders
will result in waste, dissipation or misapplication of the corporate
assets
Section 143. Rule-making
power of SEC
The Securities and Exchange Commission shall have the
power and authority to implement the provisions of this Code,
and to promulgate rules and regulations reasonably necessary to
enable it to perform its duties hereunder, particularly in the
prevention of fraud and abuses on the part of the controlling
stockholders, members, directors, trustees or officers.
SEC is empowered to promulgate rules and regulations
governing corporations reasonably necessary for the
implementation of the provisions of the Corporation Code.
(Sec.143)
Section 143. Rule-making power
of SEC
It may issue, amend, and rescind such rules necessary or
appropriate including rules and regulations defining
accounting, technical and trade terms used in the Code;
prescribing the form or forms in which information required in
registration statements, applications and reports. (Sec.
72,R.A. 8799)
SEC may impose and collect fines and/or penalties for
violations of the Code, or any other laws being implemented
by it, the pertinent rules and regulations, its orders, decisions
and/or rulings. (Sec. 121 & 139)
Section 144. Violations of the
Code
Violations of any provisions not otherwise specifically
penalized, a fine of not less than one thousand (P1,000.00)
pesos but not more than ten thousand (P10,000.00) pesos or
by imprisonment for not less than thirty (30) days but not
more than five (5) years, or both, in the discretion of the
court.
Section 74, par. 3. Refusal by any agent or officer to allow a
director or trustee, officer or stockholder or member of a
corporation to examine and copy excerpts of records and
minutes of the corporation.
Section 133
Section 144. Violations of the
Code
If the violation is committed by a corporation, the same
may, after notice and hearing, be dissolved in appropriate
proceedings before the Securities and Exchange Commission.
(Sec. 121. Involuntary Dissolution)
Provided, That such dissolution shall not preclude the
institution of appropriate action against the director, trustee or
officer of the corporation responsible for said violation:
Provided, further, That nothing in this section shall be
construed to repeal the other causes for dissolution of a
corporation provided in this Code.
Section 145. Amendment or
repeal
No right or remedy in favor of or against any corporation, its
stockholders, members, directors, trustees, or officers, nor any
liability incurred by any such corporation, stockholders,
members, directors, trustees, or officers, shall be removed or
impaired either by the subsequent dissolution of said corporation
or by any subsequent amendment or repeal of this Code or of
any part thereof.
Section 10, Article III. No law impairing the obligation of
contracts shall be passed.
Right survives dissolution of corporation.
Section 146. Repealing
Clause
Except as expressly provided by this Code, all laws or parts
thereof inconsistent with any provision of this Code shall be
deemed repealed.
Implied repeal- failed to identify the Act/Acts that are
intended to be repealed.
Enactment of a later general law will have a suppletory effect.
Sections 147 and 148
Sec. 147. Separability of provisions. - Should any
provision of this Code or any part thereof be declared invalid
or unconstitutional, the other provisions, so far as they are
separable, shall remain in force. (n)
Sec. 148. Applicability to existing corporations. - All
corporations lawfully existing and doing business in the
Philippines on the date of the effectivity of this Code and
heretofore authorized, licensed or registered by the Securities
and Exchange Commission, shall be deemed to have been
authorized, licensed or registered under the provisions of this
Code, subject to the terms and conditions of its license, and
shall be governed by the provisions hereof:
Sections 147 and 148

Provided, That if any such corporation is affected by the new


requirements of this Code, said corporation shall, unless
otherwise herein provided, be given a period of not more than
two (2) years from the effectivity of this Code within which to
comply with the same. (n)
Sec. 149. Effectivity

This Code shall take effect immediately upon its approval.


The Corporation Code was approved on May 1, 1980.
THIS CODE DID NOT TAKE EFFECT IMMEDIATELY AFTER IT
APPROVAL (Just like our justice system, paasa)

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