The Securities and Exchange Commission (SEC) reported that it has 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.
In a statement, the SEC said 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-to-back 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.
He added that, “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.”
Domestic stock corporations accounted for 74 percent or 34,140 of newly registered firms, indicating positive business sentiment.
A total of 9,727 or 21 percent are domestic non-stock corporations and 2,453 or five percent are partnerships, while the rest are foreign stock and non-stock corporations.
Of the newly registered firms, 36 percent or 16,734 are domestic stock corporations with less than five incorporators, and about 14 percent 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 percent of newly registered firms hailed from Metro Manila at 18,342. This was followed by Region IV-A (CALABARZON) at 7,217 or 16 percent of total, and Region III (Central Luzon) at 5,107 or 11 percent.
Outside Metro Manila, the largest number of newly registered firms came from Central Visayas and the Davao Region at 3,443 or seven percent, and 1,969 or four percent, respectively.
A majority or 85 percent are from the Service sector, with the Wholesale and Retail Trade Industry group registering 9,859 or 21 percent of new firms, followed by Other Service Activities at 9,756 or 21 percent.
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.
Due 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.
The SEC also launched its 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).