ESSAY 1:

a.How do foreign corporations doing business here in the Philippines contribute to the Philippine economic development?

b.Does Philippine government need to have a liberalized policy direction in on foreign corporation's doing business here in the Philippines?

c.Elaborate the various modes by which a foreign corporation may do business here in the Philippines?

d.If a foreign corporations' activity is just an isolated transaction, is it covered by the licensing requirements under the Revised Corporation Code of the Philippines?

Computation

1.If the licensee foreign corporation has generated a gross income of P50,000,000.00 for the fiscal year 2019, how much is the worth of additional securities to be deposited by the licensee to the SEC?

2.If the licensee foreign corporation initial deposited securities with actual market value of P500,000 decreased by actual market value of10%, how much is the worth of additional securities that should be deposited by the licensee?

Essay 2:

1.Explain why branch office of foreign corporations are required to have assigned capital for licensing of a branch office?

2.Are nonstock foreign corporations allowed also to have a branch office here in the Philippines?

3.Are branch offices of foreign corporations allowed to issue shares of stocks? Cite reasons.

4.Cite at least fifteen economic activities that could be subject of licensing of a branch office.

5.What document will show that a foreign corporation is solvent? Explain how solvency ratios are computed?

Multiple-choice Tests:

1.Gawsengsit Corp. is a corporation incorporated in Singapore. It invested in Bumblebee Corp., a Philippine corporation, by acquiring 30% of its shares. As a result, Gawsengsit Corp. nominated 30% of the directors of Bumblebee Corp., all of whom are Singaporeans and officers of Gawsengsit Corp. Choose the correct statement relating to Gawsengsit Corp.

a.Gawsengsit Corp. is doing business in the Philippines and requires a license from the Securities and Exchange Commission (SEC);

b.Gawsengsit Corp. has to appoint a resident agent in the Philippines;

c.Gawsengsit Corp. cannot elect directors in Bumblebee Corp.

d.Gawsengsit Corp. is not doing business in the Philippines by its mere investment in a Philippine corporation and does need a license from the SEC.

2.The following are correct statements on the rights of a foreign corporation to bring suit in the Philippines except:

a.If a foreign corporation does business in the Philippines without a license, it cannot sue before the Philippine courts;

b.If a foreign corporation is not doing business in the Philippines, it needs no license to sue before Philippine courts on an isolated business or transaction;

c.If a foreign corporation does business in the Philippines without a license, a Philippine citizen or entity which has contracted with said corporation may be estopped from challenging the foreign corporation's corporate personality in a suit brought before Philippine court; and

d.If a foreign corporation does business in the Philippines without the required license, it can sue before Philippine courts on any transaction.

3.In which of the following instances is a foreign corporation not engaged in business in the Philippines?

a.Opening a liaison office in the Philippines.

b.Participating in the management of a domestic business in the Philippines.

c.Having a nominee director to represent its interestin a domestic corporation.

d.Appointing a distributor who is domiciled in the Philippines.

4.Statement I - When a foreign corporation is issued the license to do business in the Philippines , it may commence to transact is business in the Philippines and continue to do so for as long as it retains its authority to act as a corporation , unless such license is sooner surrendered, revoked , suspended or annulled.

Statement II - A foreign corporation doing business in the Philippines without first obtaining the license to do business shall not be permitted to maintain or intervene in any action , suit or proceeding in any court or administrative agency of the Philippines.

a.Statement I is correct but Statement II is incorrect.

b.Statement II is incorrect but Statement II is correct.

c.Both statement I and II are incorrect.

d.Both statement I and II are correct.

5.Statement I - Under doctrine on "Isolated Transaction" foreign corporations are not required to obtain a license in order to obtain relief from local courts or agencies.

Statement II - Under doctrine on "Isolated Transaction" this refers to a transaction or series of transaction set apart from the common business of a foreign enterprise in the sense that there is no intention to engage in a progressivepursuit of the purpose and object of the business organization.

a.Both statement I and II are incorrect.

b.Both statement I and II are incorrect.

c.Statement I is correct but statement II is incorrect.

d.Statement I is incorrect but statement II is correct.

6.It is a corporation formed or organized or existing under any laws other than those of the Philippines and whose laws allow Filipino citizens and corporations to do business in its own country or state.

a.Domestic corporation

b.Subsidiary of a foreign corporation

c.Branch Office

d.Foreign corporation.

7.A foreign corporation lawfully doing business in the Philippines shall be bound by all laws , rules and regulationsapplicable to domestic corporations of the same class except:

a.Those which provide for the creation, formation, organization or dissolution of corporations.

b.Those which fix the relations, liabilities , responsibilities, or duties of stockholders, members of officers of corporations to each otheror to the corporation.

c.Both answers in "a" and "b"

d.None of the foregoing.

8.The resident agent of a foreign corporation doing business in the Philippines could be an individual person who is:

a.residing in the Philippines

b.of good moral character

c.of sound financial standing

d.All of the foregoing.

9.The resident agent of a foreign corporation doing business in the Philippines could be a domestic corporation. It must be:

a.of sound financial standing.

b.of good standing domestic corporation as certified by the SEC.

c.Both answers in (a) and (b)

d.None of the foregoing.

10.If the foreign corporation licensed to do business in the Philippines shall cease to transact business in the Philippinesor shall be withoit any resident agent in the Philippines , then service of any summons or other legal processmay be made upon:

a.Foreign corporation

b.Securities and Exchange Commission

c.Directors of the foreign corporation

d.None of the foregoing.

11.The initial deposit of securities with an actual market value of P500,000.00 must be complied with by the licensee foreign corporation within:

a.Sixty (60) after the issuanceof the licenseto transact business in the Philippines.

b.Thirty (30) days after the issuance of the license to transact business in the Philippines.

c.Fifteen (15) days before the issuance of the license to transact business in the Philippines.

d.Ninety (90) days after the issuance of the license to transact business in the Philippines.

12.Foreign corporations licensed to transact business in the Philippines are required to comply with deposit of securities to the SEC except:

a.Foreign corporations licensed to engage in banking activities,

b.Foreign corporations licensed to engaged in insurance business.

c.Both answers in (a) and (b).

d.None of the foregoing.

13.The following are acceptable securities for the securities deposit compliance of foreign corporations which are duly licensed to transact business in the Philippines except:

a.Bonds or other evidence of indebtedness of the Government of the Republic of the Philippines.

b.Shares of stocks of domestic corporations listed in the stock exchange.

c.Shares of stock in domestic insurance companies and banks.

d.Shares of stocks of ordinary stock corporations.

14.Which of all its creditors , and the distribution f the following refers to the termination of the existence of a corporation?

a.Liquidation

b.Dissolution

c.Amendment of Corporate Term

d.None of the foregoing choices.

15.In instances of voluntary dissolution where no creditors are affected, the required votes under the RCC are:

a.Majority vote of the board of directors or trustees and affirmative vote of the stockholders owning at least majority of the outstanding capital stockor majority of the members in a meeting to be called by the directors or trustees.

b.Majority vote of the board of directors or trustees and affirmative vote of the stockholders owning at least two-thirds (2/3) of the outstanding capital stock or two-thirds (2/3) of the members in a meeting to be called by the directors or trustees.

c.Majority vote or written assent of the board of directors or trustees and affirmative vote or written assent of the stockholders owning at least majority of the outstanding capital stock or majority of the membersin a meeting to be called by the directors or trustees.

d.Vote of all the board of directors or trustees and affirmative vote of the stockholders owning all of the outstanding capital stock or all of the membersin a meeting to be called by the directors or trustees.

16.The corporation may be dissolvedby SEC motu proprioor upon filing of a verified complaintby any interested party upon any of the following ground except:

a.Upon receipt of a lawful court order dissolving the corporation.

b.Continuous inoperation of a corporation for consecutive five years.

c.Non-use of corporate charter for five years from date of incorporation.

d.Failure to conduct an election of directors and officers.

17.Which of the following is referred as the process of winding up the affairs of a corporationwhich entails the collection of all assets, the payment of all its creditors, and the distribution of the remaining assetsif any, among the stockholders in accordance with their contracts or if there be no special contracts, on the basis of their respective interest?

a.Liquidation

b.Dissolution

c.Shortening of Corporate Term

d.None of the foregoing.

18.Which of the following will cause the automatic dissolution of a corporation?

a.Non-use of corporate charter for continuous five years from dat of incorporation.

b.Commission by the corporation of an ultra vires act.

c.Failure to adopt bylaws and submit the same to the Securities and Exchange Commission.

d.None of the foregoing answers.

19.Statement I - Dissolution of a corporation signifies the extinguishment of its franchise and the termination of its corporate existencefor business purpose.

Statement II - The mere fact that the corporation has ceased to do business does not necessarily constitute a dissolution, if it is still solvent and has not gone into liquidation.

a.Both statements are correct.

b.Both statements are incorrect.

c.Statement I is correct but statement II is incorrect.

d.Statement is incorrect but statement II is correct.

20.Statement I - If there are creditors involved in a voluntary dissolution, there is a need to file a formal petition for dissolution with the Court.

Statement II - If there are creditors involved in a voluntary dissolution, there is a need to file a formal petition for dissolution with the SEC.

a.Both statements are incorrect.

b.Both statements are correct.

c.Statement I is incorrect but statement II is correct.

d.Statement I is correct but statement II is incorrect.

21.Which of the following entities are not covered by the provision of the RCC on liquidation?

a.Banks

b.Recruitment agencies

c.Construction Companies

d.Manufacturing companies

22.One of the modes to voluntarily dissolve a corporation when there are no creditors affected is?

a.Shortening of corporate term

b.Amendment of the articles of incorporation.

c.Change of corporate name

d.Non-extension of specific term which expired.

23.The publication of the notice of voluntary dissolution where no creditors are affectedis?

a.Once

b.Twice

c.Three times

d.Four times

24.The instance where any interested party may file a petition for dissolution is in cases of:

a.Involuntary dissolution

b.Voluntary dissolution where no creditors are affected.

c.Voluntary dissolution where creditors are affected.

d.None of the foregoing answers.

25.In withdrawal of license of foreign corporations the following must be alleged in the verified petition for withdrawal except:

a.All claims which have accrued in the Philippines have been paid, compromised or settled.

b.All taxes, imposts assessments and penalties , if any lawfully due to the Philippine Governmentor any of its agencies or political subdivisions have been paid.

c.The petition for withdrawal of license has been published once a week for three (3) consecutive weeks in a newspaper of general circulation in the Philippines.

d.None of the foregoing answers.