I. Introduction

In the Philippines, the basic proof that a corporation is “legit” is proper registration with the Securities and Exchange Commission (SEC) and compliance with ongoing regulatory requirements. But in practice, with scams, fly-by-night companies, and fake “SEC certificates” circulating, it’s not enough to simply ask, “Registered ba kayo sa SEC?” You need to know how to verify that claim.

This article explains, in a Philippine legal and practical context:

What “legitimate corporation” means under Philippine law
The SEC’s role and powers
The documents you should ask for and what to look for
How to verify corporations through the SEC and other government agencies
Special cases (foreign corporations, non-stock corporations, regulated industries)
Common red flags and practical tips

This is general information and not a substitute for specific legal advice, but it’s designed to be detailed enough for due diligence, risk checks, and informed decision-making.

II. Legal Framework: Corporations and the SEC

1. What is a “corporation” under Philippine law?

Under the Revised Corporation Code of the Philippines (Republic Act No. 11232), a corporation is an artificial being created by operation of law, having:

Right of succession
Powers, attributes and properties expressly authorized by law or incident to its existence

Key points:

A Philippine corporation comes into existence only upon issuance of a Certificate of Incorporation by the SEC.
A group calling itself a “corporation” without SEC registration is not a corporation in the eyes of Philippine law, regardless of what they print on their marketing materials.

2. SEC’s mandate

The Securities and Exchange Commission (SEC) is the primary regulator for:

Incorporation and registration of stock and non-stock corporations
Monitoring corporate compliance (reportorial requirements, corporate governance rules)
Licensing entities involved in securities, lending, financing, investment schemes, and certain other regulated businesses
Investigating and acting against fraudulent investment schemes and unregistered entities engaged in securities activities

So, SEC is both:

The registrar of corporations; and
The regulator that can suspend or revoke registration, and issue advisories against entities.

III. What Does It Mean for a Corporation to Be “Legitimate”?

“Legitimate” is not a formal legal term, but in practical terms a corporation is typically regarded as legitimate if it:

Is duly registered with the SEC, with a valid Certificate of Incorporation (or an equivalent SEC registration certificate for specific types, such as one person corporations, non-stock corporations, etc.);
Is in good standing, meaning:
- It has complied with reportorial requirements (e.g., General Information Sheet (GIS), Audited Financial Statements (AFS)), and
- Its registration has not been suspended or revoked;
Has the necessary secondary licenses, where applicable (for example, lending, financing, securities dealing, investment funds, etc.); and
Complies with other relevant registrations, such as:
- BIR registration (Taxpayer Identification Number, Certificate of Registration)
- Local government permits (business/mayor’s permits)
- Other regulators where necessary (e.g., Bangko Sentral ng Pilipinas (BSP), Insurance Commission (IC), etc.)

A corporation that is SEC-registered but operating outside the scope of its allowed activities (e.g., selling investments without a required secondary license) can still be illegally operating despite having a registration.

IV. Primary Evidence of Legitimacy: Key SEC Documents

When dealing with a corporation, you can and should request copies of its SEC documents. At a minimum:

1. SEC Certificate of Incorporation / Registration

This is the principal document showing that the SEC has approved the incorporation.

Key elements to check:

Exact corporate name
SEC registration number
Date of registration
Type of corporation (stock, non-stock, one person corporation, etc.)
Presence of SEC seal, signatures, and formatting that look consistent and professional (be wary of poor photocopies or obvious editing)

If the certificate mentions that the corporation is “registered as a lending company,” “financing company,” “investment company”, or other specially regulated form, that is important. If the company claims to be such but the certificate shows only “stock corporation” with no reference to those, be cautious.

2. Articles of Incorporation (AOI) and By-Laws

These define the corporation’s structure and basic rules.

Things to review:

Corporate purpose – Does the business purpose stated match what they’re actually doing?
- Example: If the AOI says their purpose is “manufacturing and sale of garments,” but in practice they are selling investments with high returns, that’s a massive red flag.
Principal office address – Check if this matches the address they use in contracts, invoices, and website.
Authorized capital stock – See if claims about capital or size of the business align with what’s in the AOI.
Names of incorporators and initial directors – You may compare them to the people you are dealing with.

3. General Information Sheet (GIS)

Corporations must regularly submit a GIS to the SEC, usually annually or when there are changes.

The GIS is critical because it shows:

Current directors and officers
Principal office
Ownership structure (for stock corporations, the distribution of shares)

Practical uses:

Verify that the people claiming to be “President” or “Director” actually have that role on record.
Check if the address and contact details are consistent with what the company gives you.
See if there are any changes in control or ownership that might be relevant.

4. Audited Financial Statements (AFS)

The AFS, filed annually with the SEC and stamped as “received,” can show:

Size of the business (assets, revenues)
Profitability
Auditor’s opinion

While reading financials can be technical, even a basic review helps spot suspicious mismatches, such as:

A company claiming billions in revenue but showing tiny figures in AFS
No financial statements at all despite existing for several years

5. Secondary Licenses (If Applicable)

For certain industries, you must look beyond mere registration, e.g.:

Lending and Financing Companies – Need a Certificate of Authority from the SEC.
Investment Companies / Mutual Funds / Fund Managers – Need specific SEC licenses.
Securities Brokers/Dealers, Investment Houses, Underwriters – Need corresponding licenses from the SEC.

A corporation that is registered but offering investments or loans to the public without these secondary licenses is likely operating illegally, even if its primary incorporation is valid.

V. Verifying Directly with SEC

Relying solely on documents provided by the company is risky, because documents can be forged or outdated. To strengthen your verification:

1. SEC Records and Certifications

You may obtain directly from the SEC:

Certified true copies of incorporation documents (AOI, By-Laws, etc.)
Certification as to corporate existence and status (e.g., confirmation that the corporation is registered and in good standing, or showing if its registration has been suspended or revoked)

These official SEC records typically confirm:

Corporate name
SEC registration number
Date of registration
Corporate status: active, suspended, or revoked
Sometimes, compliance with reportorial requirements (e.g., whether GIS/AFS are up-to-date)

Such certifications are widely accepted by banks, government agencies, and counterparties as proof of corporate legitimacy.

2. SEC Public Information / Advisories

The SEC also issues public advisories against:

Entities soliciting investments without authority
“Ponzi” or pyramid schemes
Corporations with revoked licenses in specific regulated fields

If the corporation you are dealing with appears in an advisory as unregistered or illegally operating, that is a severe red flag, regardless of whatever documents they show you.

VI. Online Verification and Practical Steps

Even without physically visiting SEC, there are practical steps you can take (subject to whatever online systems are operational at the time):

1. Verify Basic Corporate Details

Using publicly available SEC information or their verification channels (online search tools, email inquiry, or help desks), you can:

Search using the corporate name or SEC registration number
Check if the corporation:
- Exists in SEC records
- Has the same registered name and registration number as on the certificate
- Has active status or shows as revoked/dissolved

If their name does not appear at all, or appears with a different registration number or status, that’s a strong indication something is wrong.

2. Confirm Secondary Licenses

For companies dealing in:

Lending or financing
Investment products
Securities trading or distribution

You should confirm that they appear in SEC lists of licensed entities for that particular line of business, not just in the general registry of corporations.

A classic scam pattern: the company proudly says, “SEC registered kami!” but when you check, they’re incorporated as a generic trading or consultancy company and do not hold any license to sell investments or engage in lending to the public.

VII. Cross-Checking with Other Government Registrations

Even if the SEC confirms the corporation’s existence, additional checks strengthen your due diligence.

1. Bureau of Internal Revenue (BIR)

Legitimate corporations:

Have a Taxpayer Identification Number (TIN)
Hold a BIR Certificate of Registration (Form 2303)
Issue official receipts or VAT/non-VAT invoices registered with the BIR

Red flags:

Refusal to issue official receipts
Receipts that don’t match the corporate name or TIN given
Use of another entity’s receipts for transactions

2. Local Government Unit (LGU) – Mayor’s / Business Permit

To legally operate, a corporation must secure:

Business permit / Mayor’s permit from the LGU where it operates
Typically, barangay clearance, zoning clearance, etc., as part of that process

Red flags:

No current business permit
Business address is in a different LGU from the permit shown
Permit issued to a different legal entity or trade name without clarity

3. Sector-Specific Regulators

Depending on the industry:

BSP (Bangko Sentral ng Pilipinas) for banks, quasi-banks, electronic money issuers, certain fintech and payment systems
Insurance Commission (IC) for insurance companies, HMOs, pre-need companies
CDA (Cooperative Development Authority) if you’re dealing with a cooperative (note: cooperatives are not SEC-registered; they’re CDA-registered)

If the business is in a regulated sector, simply being SEC-registered is not enough. How they are supervised by their sector’s regulator is crucial.

VIII. Special Cases: Foreign Corporations, Branches, and Non-Stock Entities

1. Foreign Corporations Doing Business in the Philippines

A foreign company cannot lawfully “do business” in the Philippines without a license from the SEC.

Look for:

SEC License to Do Business as a foreign corporation
Indication whether it is a branch office, representative office, regional operating headquarters, etc.

Red flags:

A foreign company extensively operating in the Philippines, having a local office and employees, but no SEC license
Using only contracts signed abroad to avoid compliance, even though operations are clearly local

2. Non-Stock Corporations and Foundations

Charitable organizations, NGOs, churches, and professional associations often exist as non-stock corporations under SEC.

Verification:

Check their SEC non-stock registration
Read their purpose clause (e.g., religious, educational, charitable)
For “foundations,” check if they meet the minimum capital requirements and are properly registered as such

Be particularly cautious if:

A “foundation” is soliciting donations or investments but has no clear governance, transparency, or SEC recognition consistent with its claims.

IX. Understanding Corporate Status and Its Implications

When you verify with SEC, you may see status descriptions, such as:

Active / In Good Standing – Usually means the corporation exists and complies with basic reportorial requirements.
Delinquent / Suspended – The corporation may have failed to submit GIS/AFS or violated certain rules; it remains on record but has impaired standing.
Revoked – The SEC has revoked its registration; the corporation effectively loses its legal capacity to continue business as a corporation.
Dissolved – The corporation has been formally dissolved (voluntary or involuntary).

Practical implications:

Dealing with a revoked or dissolved corporation carries significant risk: contracts may be questionable, and asset recovery becomes more difficult.
A suspended or delinquent corporation may face restrictions and penalties, and this should factor into your risk assessment.

X. Common Red Flags and How to Spot Them

Here are patterns you should be especially wary of:

Similar or confusing corporate names
- Example: “ABC Global Holdings Corporation” vs. “ABC Global Holdings Philippines Inc.”
- Scammers may register (or just claim to be) an entity whose name closely resembles a reputable one.
Inconsistent corporate details
- SEC certificate shows one address; contract or website lists a different address with no explanation.
- Names of directors in GIS don’t match the people actually controlling the operations.
No secondary license despite regulated activities
- The corporation is offering:
  - Time deposits, investment plans, or profit-sharing schemes
  - Consumer lending to the public
- But its SEC documents show it’s only a generic trading or consultancy company.
Refusal to provide SEC documents
- “Bawal ipakita yan,” “Internal lang yan,” or excessive delays in providing basic documents like the Certificate of Incorporation or GIS.
Obvious tampering or poor-quality documents
- Certificates with inconsistent fonts, wrong names of SEC officials, typographical errors, or visible editing marks.
Presence in SEC advisories
- Being explicitly named in an SEC investor alert or advisory is a major red flag.

XI. Practical Step-by-Step Guide for Due Diligence

If you are about to enter into a significant transaction with a corporation (investment, supply contract, franchise, joint venture), you can follow a structured approach:

Gather Information First
- Ask the corporation for:
  - Corporate name as registered with SEC
  - SEC registration number
  - BIR TIN
  - Principal office address
  - Names and positions of your contact persons
Request Copies of Key Documents
- SEC Certificate of Incorporation (or equivalent)
- Articles of Incorporation and By-Laws
- Latest GIS
- Latest Audited Financial Statements
- Secondary licenses (if the nature of business requires them)
- Mayor’s/business permit and BIR certificate of registration
Cross-Check Against SEC and Other Public Sources
- Confirm the corporation exists and check its status with the SEC.
- For regulated activities (investments, lending, etc.), confirm the presence of relevant SEC licenses apart from basic registration.
- Check whether the names of directors, address, and capital structure in the GIS and AOI match what you were told.
Evaluate Consistency
- Is the corporate purpose consistent with what they are doing?
- Do the financial statements support the size and scale they claim?
- Are contract signatories reflected as officers/directors in the GIS?
Assess Red Flags
- Any advisory, inconsistency, or refusal to provide documents should significantly increase your caution level.
- For major investments or high-value contracts, consider hiring counsel or a professional due diligence provider.
Document Your Checks
- Keep copies or references of certificates, screenshots of verifications, and written confirmations.
- This can be valuable if disputes arise later.

XII. Data Privacy and Access Limitations

While the SEC maintains extensive records, it is also bound by:

Data Privacy laws and
Internal policies on public access

Not all information that the SEC has is freely available to the public. Some details might require:

Formal requests
Payment of fees
Legitimate interest or authorization

Still, the core corporate data needed for basic due diligence (name, registration number, status, certain documents via certified copies) is generally available through legitimate channels.

XIII. When to Seek Professional Help

You should seriously consider consulting a lawyer or a corporate due diligence professional when:

The transaction is high value or long-term (e.g., franchise, joint venture, acquisition, major supply contract);
The corporation is involved in regulated activities (investments, financing, securities, insurance, etc.);
You have detected red flags but still want to proceed cautiously; or
You plan to rely heavily on the corporation’s performance for your own business or financial security.

A lawyer can:

Obtain and interpret SEC, LGU, BIR, and other records properly
Spot subtle issues in corporate documents and financial statements
Advise on appropriate contractual protections, warranties, and conditions precedent

XIV. Conclusion

In the Philippines, checking if a corporation is legitimate is not a matter of just asking, “Registered ba kayo sa SEC?” It involves a combination of document review, direct verification with SEC, cross-checks with other government agencies, and critical analysis of what the corporation is actually doing versus what it is legally allowed to do.

At the very least, a legitimate corporation should:

Be properly incorporated with the SEC
Be in good standing and compliant with reportorial requirements
Have the proper secondary licenses if it operates in a regulated sector
Be registered with the BIR and its LGU, and
Be able and willing to show you the documents that prove all of the above.

Taking the time to verify these things can save you from financial loss, legal trouble, and involvement with fraudulent schemes later on.