SEC releases compliance guidelines for solo corporations

The Securities and Exchange Commission (SEC) recently released a detailed set of compliance guidelines tailored specifically for one-person corporations (OPCs) to aid them in meeting their regulatory obligations effectively. This comprehensive checklist, known as Memorandum Circular No. 10, Series of 2026, consolidates the rules concerning OPCs’ compliance with reportorial requirements and bond posting. The guidelines also outline the fines and penalties associated with violations, as stipulated in the Republic Act 11232 and other governing laws and regulations.

SEC Chairperson Francis Lim highlighted that the new guidelines serve to clarify the expectations around report submissions for OPCs, removing any ambiguities and empowering business owners to operate confidently within legal boundaries. By streamlining the compliance process, the SEC aims to enhance its monitoring capabilities over corporations, aligning with its mission to promote transparency and accountability in the corporate sector.

According to the guidelines, OPCs must appoint key officers like a treasurer, corporate secretary, and others and file a Form of Appointment (FAO) with the SEC within 20 days of obtaining their certificate of incorporation. Failure to do so will result in a penalty of P10,000. Subsequent appointments require the OPC to submit an FAO within five days of the appointment, with penalties ranging from P5,000 to P9,000 for each missed report.

Annual financial statements (AFS) are expected to be submitted by OPCs as per the deadline prescribed by the Commission or within 120 days from the end of the fiscal year. The guidelines introduce amended penalty rates to ensure that fines for late or non-filing of financial statements are proportionate to an OPC’s scale of operations. The penalties vary based on the timing of submission and the financial standing of the company, with penalties ranging from P5,000 to P27,000 for late or non-filing offenses.

OPCs with total assets or liabilities exceeding P3 million are mandated to submit an audited financial statement for the fiscal year ending on or after December 31, 2025. In cases where the audit threshold is not met, a financial statement accompanied by a Management Responsibility Statement is required, signed under oath by the president and treasurer.

For OPCs where the single stockholder also serves as the treasurer, a surety bond must be posted, with the coverage amount determined by the OPC’s authorized capital stock. The bond is subject to renewal every two years or based on the review of financial statements or amended articles of incorporation. Penalties are outlined for delays in posting bonds, with fines escalating for subsequent violations.

Non-compliance with posting bond deadlines can lead to penalties of P10,000 plus monthly charges for delays. OPCs are given a grace period to comply with bond requirements, failing which penalties will be imposed. Monitoring efforts will continue to ensure that OPCs maintain valid and up-to-date compliance with regulatory obligations.

In summary, the SEC’s issuance of compliance guidelines for OPCs underscores its commitment to promoting a culture of regulatory adherence and corporate governance within the business landscape. The new guidelines aim to provide clarity and structure for OPCs to navigate their obligations efficiently and avoid potential penalties for non-compliance. By fostering a culture of accountability and transparency, the SEC seeks to strengthen oversight mechanisms and uphold standards of corporate integrity in the Philippines.