RULE 104
Court of First
Jurisdiction:
Instance 


 

Presidential Decree 902-A and Corporation Code(BP 68)

Securities and Exchange
Jurisdiction:
Commission(SEC)

Presidential Decree 902-A and Corporation Code(BP 68)

Jurisdiction: Regional Trial R.A No. 8799 p
July 19,
Court 2000
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 Decisions of the courts in the foregoing
cases are appealable to the Court of
Appeals, as provided by Section 70 of
Rep. Act No. 8799, which is an
affirmation of Rule 43, 1997 Rules of
Civil Procedure.
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 When no creditors are involved, only a SEC
application for dissolution is required. The
process is equivalent to the application for the
amendment of the articles of incorporation,
except that in addition, publication of the notice
of dissolution must also be complied with.
 Under Section 118 of the Corporation Code, in
case the dissolution of a corporation does not
prejudice the rights of any creditor having a
claim against such a corporation, the dissolution
may be affected by complying with the following
procedural requirements:
J
 of the board of directors or
trustees adopting a resolution for the
dissolution of the corporation;
2. Sending notices to each stockholder or
member either by registered mail or by
personal delivery, of the time, place and
object of the meeting calling for the
approval of the dissolution of the
corporation, at least thirty (30) days prior
to said meeting;
3. Publication of such notice of meeting for
three (3) consecutive weeks in a
newspaper published in the place where
the principal office of said corporation is
located; and if none, in a newspaper of
general circulation in the Philippines; and
4. The resolution duly adopted by the
affirmative vote of the stockholders
owning at least two-thirds (2/3) of the
outstanding capital stock, or of at least
two-thirds (2/3) of the members, at a
meeting held on the call of the directors or
trustees.
 A copy of the resolution authorizing the
dissolution shall be certified by a majority
of the board of directors or trustees and
countersigned by the secretary of the
corporation and filed with the SEC. The
Ê  shall thereupon issue the certificate of
dissolution.
 The SEC will not deny an application for
dissolution when there are no creditors
involved because of the constitutional
prohibition against involuntary servitude or
the constitutional guarantee of association,
and the right to refuse to continue an
association.
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 If there are no creditors involved, there is a need to file
a formal petition for dissolution with the SEC. The
proceedings are quasi-judicial in nature and
conducted to ensure that the rights of the creditors are
fully protected. In such proceedings, the SEC is not
mandated to dissolve a corporation, especially when it
would be detrimental to the interests of the creditors,
who may wish to rehabilitate the operations of the
corporation to ensure that it would be able to pay-off
all of its debt.

 Under Section 119 of the Corporation Code, where the

dissolution may prejudice the rights of any creditor, the
following procedure shall be complied with:
1. A petition for dissolution shall be filed with
the SEC, signed by a majority of its board
of directors or trustees or other officers
having the management of its affairs,
verified by its president or secretary or one
of its directors or trustees, and shall set
forth all claims and demands against it, and
that its dissolution was resolved upon by
the affirmative vote of the stockholders
representing at least two-thirds (2/3) of the
outstanding capital stock or by at least two-
thirds (2/3) of the members at a meeting of
its stockholders or members called for that
purpose.
2. If the petition is sufficient in form
and substance, the SEC, by an
order reciting the purpose of the
petition, shall fix a date on or
before which objections thereto
may be filed by any person,
which date shall not be less than
thirty (30) days nor more than
sixty (60) days after the entry of
the order.
3. Before such date, a copy of the order
shall be published at least once a week
for three (3) consecutive weeks in a
newspaper of general circulation
published in the municipality or city
where the principal office of the
corporation is situated, or if there be no
such newspaper, then in a newspaper of
general circulation in the Philippines,
and a similar copy shall be posted for
three (3) consecutive weeks in three (3)
public places in such municipality or city.
4. Upon five (5) day¶s notice, given after
the date on which the right to file
objections as fixed in the order has
expired, the Commission shall proceed
to hear the petition and try any issue
made by the objections filed; and if no
such objection is sufficient, and the
material allegations of the petition are
true, it shall render judgment dissolving
the corporation and directing such
disposition of its assets as justice
requires, and may appoint a receiver to
collect such assets and pay the debts of
the corporation.
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 A voluntary dissolution may be effected by
amending the articles of incorporation to shorten
the corporate term. A copy of the amended articles
of incorporation shall be submitted to the SEC in
accordance with the Corporation Code. Upon
approval of the amended articles of incorporation
of the expiration of the shortened term, as the
case may be, the corporation shall be deemed
dissolved without any further proceedings, subject
to the provisions for corporate liquidation.
The following requirements must be submitted to
the SEC:
1. Notice of the dissolution of
the corporation by shortening
its corporate term be
published in a newspaper of
general circulation for three
(3) consecutive weeks;
2. List of corporate creditors,
with their consent to the
shortening of corporate term;
3. Submission by the majority stockholders
or principal officers of the corporation of
an undertaking under oath that they
shall be personally answer for any
outstanding obligations of the
corporation; and
4. Latest audited financial statements of
the corporation which must not be
earlier than the date of the stockholders¶
or membership meeting approving the
amendment to the articles of
incorporation;
5. BIR Tax Clearance
6. Directors' Certificate - A Notarized
document signed by majority of the
directors and corporate secretary
certifying the amendment of the articles
of incorporation shortening the corporate
term, the votes of the directors and
stockholders thereto, and the date and
place of the stockholders meeting
7. Indorsments/clearances from other
government agencies, if applicable.
 


 


  
 
 This is another mode of voluntary
dissolution, when the corporate life of
the corporation as stated in its articles of
incorporation is allowed to expire,
without extension, then the corporation
is deemed dissolved by such expiration
without the need of further action on the
part of the corporation or the State.
(Section 11).