CORPORATION is a juridical person created by operation of law under the Corporation Code. It has a personality separate and distinct from that of its stockholders. It consists of at least five (5) to fifteen (15) incorporators each of whom must hold at least one share. It must be registered with the Securities and Exchange Commission (SEC). The minimum paid-up capital is five thousand pesos (Php 5,000.00). It has a right of succession.
PARTNERSHIP is treated as an artificial being created by operation of law with a separate legal personality from that of its members. It may either be general or limited, depending on the liability of the partners. It consists of two (2) or more partners. A partnership must be register with the Securities and Exchange Commission (SEC) with a minimum capitalization of three thousand pesos (Php 3,000.00). It has no right of succession.
CORPORATION acquires juridical personality from the date of issuance of the certificate of incorporation by the Securities and Exchange Commission. PARTNERSHIP acquires juridical personality from the moment of execution of the contract of partnership.
CORPORATION can exercise only the powers expressly granted by law or implied from those granted or incident to its existence. PARTNERSHIP may exercise any power authorized by the partners (provided it is not contrary to law, morals, good customs, public order and public policy).
In a CORPORATION, a stockholder has generally the right to transfer his shares without prior consent of the other stockholders. Whereas, in PARTNERSHIP, a partner cannot transfer his interest in the partnership to make the transferee a partner without the unanimous consent of all existing partners because the partnership is based on the principle of delectus personarum.
In a CORPORATION, the power to do business and manage its affairs is vested in the Board of Directors and trustees. In PARTNERSHIP, when management is not agreed upon, every partner is an agent of the partnership.
CORPORATION may adopt any name provided it is not the same as or similar to any registered firm name. In PARTNERSHIP, limited partnership is required by law to add the word “Ltd” to its name.
CORPORATION can only be dissolved with the consent of the State. PARTNERSHIP may be dissolved at any time by or all of the partners.
CORPORATION is governed by the Corporation Code while PARTNERSHIP is governed by the Civil Code.
The term of existence of a CORPORATION must not exceed fifty (50) years but extendible to not more than 50 years in any one instance, whereas, in PARTNERSHIP, may be established for any period of time stipulated by the partners.
If you are planning to set up a corporation or partnership in the Philippines, our firm will gladly assist you to organize the documentation and liaise with the concerned government agencies in your behalf. You can contact us to help you with all your queries and concerns at 310-1020.