40 Questions
What type of corporation is authorized to distribute dividends or allotments of surplus profits to its shareholders?
Stock corporation
Which type of corporation is not absolutely a corporation but is considered as if it were?
Quasi-corporation
What type of corporation is engaged in rendering basic services of public importance?
Quasi-public corporation
What type of corporation is organized by the government or of which the government is a majority stockholder?
Government-owned or controlled corporation
What type of corporation consists of one member or corporator and his successors?
Corporation sole
What type of corporation is organized for religious purposes?
Ecclesiastical corporation
What type of corporation is organized for charitable purposes?
Eleemosynary corporation
What type of corporation has all the outstanding stock owned by the persons who are active in management and conduct of the business?
Close corporation
What is the title of the Code as stated in Sec. 1?
The Corporation Code of the Philippines
What is a characteristic of a corporation as an artificial being?
It has the right of succession
What is a similarity between a partnership and a corporation?
Both have juridical personality separate and distinct from the individuals composing it
What is an advantage of a corporate form of business organization?
The capacity to hold property, to contract, to sue and be sued as a legal unit or distinct entity
What is the name of the law that repealed Batas Pambansa Blg. 68?
Republic Act No. 11232
What is a characteristic of a corporation that is not an attribute of a partnership?
Exemption of shareholders from individual liability
What are the two classes of corporations that may be formed or organized under this Code?
Stock and non-stock corporations
What is a consequence of a corporation's power to hold property?
The corporation's assets can be used to contract and sue
What is a corporation that operates in multiple countries called?
Multi-national
What is the main characteristic of a non-profit corporation?
Organization without contemplation of gains, profits or dividends to members
What is a De Jure corporation?
A corporation created in strict or substantial conformity with statutory requirements
What governs corporations created by special laws or charters?
The provisions of the special law or charter, supplemented by the provisions of this Code
Who are the people who compose a corporation?
Corporators, whether as stockholders or members
Who are the people who originally formed and composed the corporation and are signatories of the articles of incorporation?
Incorporators
What are the corporators in a stock corporation called?
Stockholders or shareholders
What are the corporators in a non-stock corporation called?
Members
What is the role of a promoter in a business venture?
To find an enterprise or venture and help attract investors
What must be indicated in the articles of incorporation regarding shares?
The classification of shares, their corresponding rights, privileges, restrictions, and par value
What is the exception to the rule that each share is equal in all respects to every other share?
When the shares are classified as preferred or redeemable
What is the purpose of dividing shares into classes or series?
To provide different rights and privileges to different shareholders
Which type of shares can be deprived of voting rights?
All of the above
What matters can holders of non-voting shares still vote on?
The amendment of the articles of incorporation, among other matters
What is the purpose of the rule that a corporation must have a class or series of shares with complete voting rights?
To ensure that the corporation is accountable to its shareholders
What is the vote required under this Code to approve a particular corporate act?
A majority vote of shareholders with voting rights
What is the general rule regarding voting rights in a stock corporation?
Every member has a right to vote, unless there is a stipulation in contrary.
What is the key characteristic of par value shares?
They have a given fixed or definite value in the articles of incorporation.
What is the main difference between preferred shares and common shares?
Preferred shares have priority in terms of assets and dividends.
What is the purpose of promotion shares?
To give to people who help promote the company and perform important tasks.
What is the main characteristic of shares of escrow?
They are shares subject to an escrow agreement.
Which type of shares is given to the founders of a company?
Founder's shares
What is the purpose of redeemable or callable shares?
To allow the company to buy back shares from shareholders.
Which type of companies are not permitted to issue no-par value shares?
Banks, trust, insurance, and pre-need companies
Study Notes
Corporation Code of the Philippines
- The Corporation Code of the Philippines is also known as Batas Pambansa Blg. 68, which is now repealed by Republic Act No. 11232, also known as the Revised Corporation Code of the Philippines.
Definition of a Corporation
- A corporation is an artificial being created by operation of law, having the right of succession and the powers, attributes, and properties expressly authorized by law or incident to its existence.
- Attributes of a corporation:
- Artificial being
- Created by operation of law
- Right of succession
- Powers, attributes, and properties authorized by law or incident to its existence
Similarities between a Partnership and a Corporation
- Juridical personality separate and distinct from the individuals composing it
- Acts only through its agents
- Composed of an aggregate of individuals
- Distributes profits to those who contribute to capital
- May be organized only when authorized by law
- Subject to income tax
Advantages of a Corporate Form of Business Organization
- Capacity to hold property, to contract, to sue and be sued as a legal unit or distinct entity
- Exemption of shareholders from individual liability
- Continuity of existence in spite of death or changes of members
- Transferability of shares
- Centralized management under a board of directors
- Standardized methods of organization, management, and finance for the protection of shareholders and creditors under statutory regulations
Classes of Corporations
- Stock corporations
- Non-stock corporations
- Quasi-corporations
- Quasi-public corporations
- Government-owned or controlled corporations
- Domestic corporations
- Foreign corporations
- Corporation aggregate
- Corporation sole
- Religious corporations
- Ecclesiastical corporations
- Lay corporations
- Eleemosynary corporations
- Civil corporations
- Close corporations
- Open corporations
- Multi-national corporations
- Non-profit corporations
- De Jure corporations
Components of a Corporation
- Corporators: those who compose a corporation, whether as stockholders or members
- Incorporators: those stockholders or members mentioned in the articles of incorporation as originally forming and composing the corporation
- Stockholders or shareholders: corporators in a stock corporation
- Members: corporators in a non-stock corporation
- Promoters: self-constituted organizers who find an enterprise or venture and help to attract investors, form a corporation, and launch it in business
Classification of Shares
- Classification of shares, their corresponding rights, privileges, restrictions, and stated par value, if any, must be indicated in the articles of incorporation
- Each share shall be equal in all respects to every other share, except as otherwise provided in the articles of incorporation
- Shares may be divided into classes or series of shares, or both
- Holders of non-voting shares shall nevertheless be entitled to vote on certain matters
Types of Shares
- Voting and Non-Voting Shares
- Par Value and No-Par Value Shares
- Common and Preferred Shares
- Promotion Shares
- Shares of Escrow
- Founder's Shares
- Redeemable "Callable" Shares
- Treasury Shares
- Other shares classified to comply with constitutional or legal requirements
This quiz covers the Corporation Code of the Philippines, also known as Batas Pambansa Blg. 68, as amended by Republic Act No. 11232. It includes general provisions, definitions, and classifications.
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