In the Philippines, you can become a shareholder by purchasing stock directly from a company, acquiring shares in a company from other stockholders or buying them directly from the stock market. In this article, our company formation advisors in the Philippines briefly explain what each of these methods of becoming a shareholder in the Philippinesimplies.
Acquiring shares directly from a legal entity in the Philippines
When a company needs capital, it can issue shares of stock for investors. This method is often named a primary offering.
The proceeds of sale goes to the treasury of the legal entity, which actually forms part of its capital.
Such an example is when a legal entity provides shares for the general public for the first time. This means, when the company is listed on the stock market. This procedure is called an Initial Public Offering (IPO).
Acquiring shares from other stockholders
This method of becoming a shareholder in the Philippines is referred to as a secondary offering. It implies the existing shareholders in a company who are selling their shares of stock to new entrepreneurs.
In such a case, the corporation does not receive any new funds.
Buying shares from the public stock market in the Philippines
In the Philippines, the main means of trading shares of stock is on the Philippine Stock Exchange, which has the main function of allowing the purchase and sale of stocks and other financial instruments through accredited stockbrokers and its trading members.
Our Philippines company formation agents can offer more details on this method of becoming a shareholder in the Philippines.
Rights of shareholders in the Philippines
Shareholders in the Philippines have some of the following rights:
• Direct or indirect participation in a company’s management;
• Voting rights;
• The power to remove directors;
• Proprietary rights;
• Other rights: our Philippines company formation consultants can offer more details on what these other rights consist of.
Are you a company shareholder or are you interested in starting a company? Knowing more about the local tax rules and accounting principles can be useful before you start. If you want to know more about these rules, or if you already run a company and need ongoing tax assistance and counseling, you can reach out to our accountants in Philippines for complete information about our services.
If you require more information on becoming a shareholder in the Philippines, or for assistance in starting a business in the Philippines, please get in touch with our friendly staff.
Remaining in the Philippines as a shareholder is subject to certain requirements and it is important to be well aware of these. The Philippines allows the admission of individuals who wish to immigrate to the Philippines based on the nationality of the applicant. If his or her country has diplomatic relations with the Philippines and grants the same rights to Filipino citizens, the application can be taken into account.