CHOOSING the right legal structure is one of the first important decisions an entrepreneur must make when starting a business in the Philippines. For many, this comes down to two popular options: the one-person corporation and the traditional domestic corporation. Understanding the distinctions between these two entities can help entrepreneurs select the model that best suits their business goals.BackgroundThe OPC structure took effect in 2019 through the Revised Corporation Code.
To be recognized as a Philippine corporation, the shareholders must follow a 40/60 rule in which the majority shareholders are Philippine citizens. This structure may be more fitting for businesses with multiple investors or those intending to grow by bringing in new partners.The OPC and domestic corporation are treated as separate legal entities from their owners. This means that the owners' liability is limited to their capital investment in the company.