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The Securities and Exchange Commission (SEC) registered a new record in terms of company registrations in 2023, a testament to the ease with which new businesses can be established in the Philippines.
A record high of 46,445 firms successfully registered using the SEC Electronic Simplified Processing of Application for Registration of Corporation (eSPARC) from January to November 2023, surpassing the previous record of 42,936 for the entire 2022.
“In the past five years, the SEC has fiercely advocated for digital transformation to achieve efficiency and accessibility in the corporate sector. The back-toback record highs seen in 2022 and 2023 for company registration prove that we are succeeding in making doing business easier in the Philippines," SEC Chairperson Emilio B. Aquino said.
“As we start a new year, the SEC is ready to further take advantage of automated processes in place, as well as develop new systems, to ensure the smooth delivery of services to the transacting public,” he added.
Domestic stock corporations accounted for 74% or 34,140 of newly registered firms, indicating positive business sentiment. A total of 9,727 or 21% are domestic non-stock corporations and 2,453 or 5% are partnerships, while the rest are foreign stock and non-stock corporations.
Of the newly registered firms, 36% or 16,734 are domestic stock corporations with less than five incorporators, and about 14% are one person corporations (OPCs).
The enactment of Republic Act No. 11232, or the Revised Corporation Code of the Philippines, in 2019 paved the way for the formation of OPCs and corporations with less than five incorporators. The old Corporation Code had required at least five incorporators.
More than a third or 39% of newly registered firms hailed from Metro Manila at 18,342. This was followed by Region IV-A (CALABARZON) at 7,217 (16%) and Region III (Central Luzon) at 5,107 (11%). Outside Metro Manila, the largest number of newly registered firms came from Central Visayas and the Davao Region at 3,443 (7%) and 1,969 (4%), respectively.
Majority or 85% are from the Service sector, with the Wholesale and Retail Trade Industry group registering 9,859 (21%) new firms, followed by Other Service Activities at 9,756 (21%).
The SEC attributes the higher number of new registrations to the success of its digital initiatives, starting with the launch of eSPARC in April 2021 and its subsystem, the One Day Submission and Electronic Registration of Companies (OneSEC) in September 2021.
The launch of eSPARC reduced the time needed to register a company from 34 to three days. Applicants also have the option to register through OneSEC, a pass-through system with uses pre-filled application forms, under which the Commission registered a record processing time of one minute and 14 seconds from the start of the application to the receipt of a digital certificate of incorporation.
Thanks to eSPARC, the Philippines was recently recognized as having one of the best company registration systems in the world by the Corporate Registers Forum, an international body of corporate registries, during a conference in Malta in October.
In addition, the SEC launched the Electronic Filing and Submission Tool in 2021, for the submission of digital copies of reportorial requirements, such as annual financial statements and general information sheets.
The Commission also launched the Electronic System for Payments to the SEC (eSPAYSEC), where the public can choose from over 90,000 online and offline payment options.
In 2023, President Ferdinand R. Marcos, Jr. himself launched the Commission’s new advanced systems for access to corporate information and other services, namely: Electronic SEC Universal Registration Environment (eSECURE), SEC CheckApp 2.0, Electronic SEC Education, Analysis, Research Computing Hub (eSEARCH), SEC API Marketplace, and the Electronic Registration Application for Market Participants (eRAMP).
“Throughout the commission’s existence, the SEC has helped create an environment that benefits the business and investment sectors. Your openness to achieving digital transformation has likewise been integral to fostering business formation and for growth,” President Marcos said in his speech during the 85th Anniversary of the SEC as Company Registrar in June.
“Through the digital reforms that you have put in place, you have made it easier for corporations to comply with the requirements and maintain a good standing in the business community,” the President added.
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ABOUT THE BLOGGER
Hi, I'm Ralph Gregore Masalihit!
An RFP Graduate (Registered Financial Planner Institute - Philippines).
A Personal Finance Advocate. An I.T. by Profession. An Investor. Business Minded. An Introvert. A Photography Enthusiast. A Travel and Personal Finance Blogger (Lakbay Diwa and Kuripot Pinoy).
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