Bylaws serve as the internal constitution of a Non-Governmental Organization (NGO)—usually registered as a non-stock, nc-profit corporation with the Securities and Exchange Commission (SEC). They govern everything from member voting rights and trustee qualifications to the schedule of annual meetings.
However, as an NGO grows, expands its programs, or adapts to changing regulations like the Revised Corporation Code (RCC) of the Philippines (Republic Act No. 11232), its original bylaws may become restrictive or obsolete. Amending these bylaws is a formal legal process that requires strict compliance with Philippine corporate law to ensure the amendments are valid and legally binding.
1. Legal Basis for Amendment
Under Section 47 of the Revised Corporation Code (RCC), a non-stock corporation has the inherent power to adopt, amend, or repeal its bylaws, or adopt new ones.
To be legally effective, any amendment must not violate the Philippine Constitution, the RCC, existing special laws, or the NGO’s own Articles of Incorporation (AOI). If a conflict arises between the AOI and the bylaws, the AOI always prevails.
2. Required Vote Thresholds
Amending the bylaws is a major corporate act that cannot be done by the Board of Trustees alone. It requires a dual layer of approval:
- The Board of Trustees: A majority vote of the members of the Board of Trustees is required.
- The General Membership: The amendment must be approved by the affirmative vote of members representing at least a majority of the total outstanding members of the non-stock corporation.
Note on Delegation: Alternatively, pursuant to Section 47 of the RCC, the members may delegate the power to amend or repeal the bylaws to the Board of Trustees by a two-thirds (2/3) vote of the outstanding membership. However, this delegated power can be revoked at any time by a simple majority vote of the members during a regular or special meeting.
3. Step-by-Step Amendment Process
Step 1: Board Review and Proposal
The Board of Trustees or a designated legal committee reviews the existing bylaws and drafts the proposed changes. A board meeting is called with proper notice, and the trustees vote to approve the proposed amendments.
Step 2: Notice to Members
A notice of a regular or special meeting must be sent to all members of record. The notice must explicitly state that the amendment of the bylaws is on the agenda and should ideally include a copy of the proposed changes.
Step 3: Membership Ratification
During the membership meeting, the amendments are presented for discussion and voted upon. The votes must be formally cast and counted to ensure the majority threshold is met.
Step 4: Execution of the Amended Bylaws and Certificates
Once approved, the NGO must prepare the formal legal documentation required by the SEC.
4. Documentary Requirements for the SEC
To formalize the changes, the NGO must submit a petition/application for amendment to the SEC (typically through the SEC Electronic Simplified Processing of Application for Registration of Company or eSPARC portal, or compliance drives). The standard document package includes:
A. Amended Bylaws
A full copy of the bylaws integrating the new changes. The SEC strictly requires the "underscoring/bolding" rule:
- Any new provision added must be underscored or bolded.
- Any deleted provision must be indicated (e.g., by striking through or noting its deletion).
B. Trustees' Certificate
This is a notarized document signed by a majority of the Trustees and the Corporate Secretary. It must certify:
- The date and place of the board and membership meetings.
- That the amendments were approved by a majority of the Trustees.
- That the amendments were ratified by a majority of the total membership.
- That the attached document is a true and correct copy of the Amended Bylaws.
C. Secretary's Certificate of No Pending Case
A notarized certification by the Corporate Secretary stating that there is no pending intra-corporate dispute or litigation involving the NGO, its trustees, or its members that would affect the validity of the amendment.
D. Compliance with Republic Act No. 11232 (RCC)
Ensure that the NGO's Tax Identification Number (TIN) for the corporation, as well as the names, nationalities, and current identification details of the trustees, are updated if requested.
5. Crucial NGO-Specific Considerations
When amending bylaws, Philippine NGOs must keep specific operational nuances in mind:
| Area of Amendment | Crucial Considerations |
|---|---|
| Mode of Meetings | Under the RCC, NGOs can now explicitly include provisions allowing teleconferencing, videoconferencing, or remote communication for board and member meetings, as well as voting in absentia. |
| Qualifications of Trustees | NGOs often want to preserve their advocacy focus. The bylaws can be amended to require that trustees must possess specific expertise (e.g., environmental science, human rights law) or have been active members for a specific duration. |
| Termination of Membership | To protect the integrity of the NGO, clear mechanisms and grounds for the suspension or expulsion of erring members should be clearly outlined in the amended bylaws, ensuring due process. |
| Disposition of Assets | For NGOs with tax-exempt status under the Bureau of Internal Revenue (BIR) or those accredited by the Philippine Council for NGO Certification (PCNC), the bylaws must dictate that upon dissolution, assets will be transferred to another similar non-profit or the State, and not distributed to members. |
6. Filing and Effectivity
The corporate secretary must submit the complete, notarized documents to the SEC and pay the prescribed filing fees.
Under the law, the amendments take effect only upon the issuance by the SEC of a Certificate of Filing of Amended Bylaws. If the SEC fails to act on the application within six (6) months from the date of filing for reasons not attributable to the NGO, the amendments will take effect as of the date of filing, unless the delays are due to compliance issues raised by the Commission.