The Revised Corporation Code introduced the One Person Corporation (OPC), a corporation with a single stockholder, allowing an individual entrepreneur to enjoy the benefits of a separate corporate personality and limited liability without needing the minimum number of incorporators previously required. Only a natural person, a trust, or an estate may form an OPC; certain persons and entities are not allowed to incorporate as an OPC, including banks, quasi-banks, pre-need, trust, insurance, public and publicly-listed companies, and non-chartered government-owned and controlled corporations, and a natural person licensed to exercise a profession may not organize an OPC for the purpose of exercising that profession except as otherwise provided by special laws. An OPC does not need a minimum authorized capital stock unless otherwise required by special law, and it is not required to submit by-laws. Its governance is streamlined: the single stockholder is automatically the sole director and president. The single stockholder must appoint a treasurer, a corporate secretary, and other officers within a period after registration, and notify the SEC; the single stockholder may be the treasurer but may NOT be the corporate secretary, and if they serve as treasurer, they must post a surety bond. A crucial requirement is the nominee: the single stockholder must designate a nominee and an alternate nominee who shall, in the event of the stockholder's death or incapacity, take the place of the single stockholder in managing the corporation. On liability, the OPC gives limited liability, but with a safeguard: the sole shareholder claiming limited liability has the burden of affirmatively showing that the corporation was adequately financed, and if the single stockholder cannot prove that the property of the OPC is independent of their personal property, they shall be jointly and severally liable for the debts of the corporation (a codified piercing rule). So an OPC lets one person incorporate with limited liability, under a streamlined structure requiring nominees and proper separation of corporate and personal assets.
One Stockholder, Full Corporation
The One Person Corporation (OPC) has a single stockholder, letting an individual enjoy a separate personality and limited liability without multiple incorporators.
Who May (and May Not) Form One
Only a natural person, trust, or estate may form an OPC. Not allowed: banks, quasi-banks, pre-need, trust, insurance, public/listed companies, and non-chartered GOCCs; and a licensed professional may not organize an OPC to practice that profession (unless a special law allows).
Governance and the Nominee
The single stockholder is automatically the sole director and president, and must appoint a treasurer and corporate secretary (they may be treasurer with a surety bond, but NOT corporate secretary). They must designate a nominee and alternate to take over on death or incapacity. No by-laws required.
The Limited-Liability Safeguard
Limited liability applies, but the sole shareholder must affirmatively prove adequate financing and that the OPC's property is independent of their personal property — otherwise they are jointly and severally liable for corporate debts.
Practical Takeaways
- An OPC lets one person incorporate with limited liability;
- Appoint a treasurer, secretary, and nominee;
- Keep assets separate or lose limited liability.
Frequently Asked Questions
What is a One Person Corporation? A corporation with a single stockholder, introduced by the Revised Corporation Code, allowing an individual to enjoy a separate corporate personality and limited liability without the previously required minimum number of incorporators.
Who can form an OPC? Only a natural person, a trust, or an estate. Banks, quasi-banks, pre-need, trust, insurance, public and listed companies, and non-chartered GOCCs cannot, and a licensed professional cannot organize an OPC to practice that profession unless a special law allows.
What officers does an OPC need? The single stockholder is automatically the sole director and president, and must appoint a treasurer, a corporate secretary, and other officers. The stockholder may be treasurer (with a surety bond) but may not be the corporate secretary.
Does an OPC really have limited liability? Yes, but with a safeguard. The sole shareholder must affirmatively show the corporation was adequately financed and that its property is independent of their personal property, or they become jointly and severally liable for its debts.
This commentary is for general informational purposes only and does not constitute legal advice. For guidance specific to your situation, please consult a licensed attorney.
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