BUSINESS LAWS AND REGULATIONS (2nd
SEMESTER 2024-2025)
INSTRUCTOR: BLESSY O. DANTE, CPA
COURSE STRUCTURE: FULL FACE TO FACE CLASSROOM DISCUSSION
COURSE DESCRIPTION:
This subject covers the basic or fundamental knowledge of the following
to wit:
• Business organizations/associations, and of business laws including
their legal implications.
• Pertinent legal provisions, general principles, concepts, and underlying
philosophy of the laws applicable to commerce and business.
COURSE OBJECTIVE:
• Students will know and understand the pertinent legal provisions,
general principles, concepts and underlying philosophy of the laws
applicable to commerce and business.
• Students having obtained sufficient knowledge will enable them to
recognize the legal implications of business situations or transactions
which will prompt them to be vigilant in seeking legal counsel or
recommending that the same be sought whenever applicable.
• Students will be able to apply the various regulatory framework
measures and pertinent legal provisions relative to particular business
scenarios.
• Students will be familiar with the future clients’ rights and remedies
with the handling of disputes on regulatory issues. Consequently,
students will know the various offices that they will be interacting and
the basic regulations they will derive benefits from.
• Students will learn to communicate effectively matters pertaining to the
regulatory work that will be handled.
• Students will obtain competencies above cited as an entry level
accountant who can address the fundamental requirements of different
parties that the student will be interacting later as accountants and
professionals.
COURSE SYLLABUS
Law on Business Organizations
1. Partnerships
1.1 Nature and as distinguished from corporation
1.2 Kinds of partnerships
1.3 Formalities required
1.4 Rules of management
1.5 Obligations of partners
1.5.1 To the partnership and to the partners
1.5.2 To third persons
1.6 Rights of a partner
1.7 Sharing of profits and losses
1.8 Dissolution and winding up
1.9 Limited Partnership
2. Corporations
2.1 Definition of corporation
2.2 Classes of corporations
2.3 Nationality of corporations
2.3.1 Control test
2.3.2 Grandfather rule
2.4 Corporate juridical personality
2.4.1 Doctrine of separate juridical personality
2.4.1.1 Liability for tort and crimes
2.4.1.2 Recovery of damages
2.4.2 Doctrine of piercing the corporate veil
2.4.2.1 Grounds for application of doctrine
2.4.2.2 Test in determining applicability
2.5 Capital structure
2.5.1 Number and qualifications of incorporators
2.5.2 Subscription requirements
2.5.3 Corporate term
2.5.4 Classification of shares
2.5.4.1 Preferred shares versus common shares
2.5.4.2 Scope of voting rights subject to
classification
2.5.4.3 Founder's shares
2.5.4.4 Redeemable shares
2.5.4.5 Treasury shares
2.6 Incorporation and organization
2.6.1 Promoter
2.6.2 Subscription contract
2.6.3 Pre-incorporation subscription agreements
2.6.4 Consideration for stocks
2.6.5 Articles of Incorporation
2.6.5.1 Contents
2.6.5.2 Non-amendable items
2.6.6 Corporate name; limitations on use of corporate name
2.6.7 Registration, incorporation, and commencement of corporate
existence
2.6.8 Election of directors or trustees
2.6.9 Adoption of by-laws
2.6.9.1 Contents of by-laws
2.6.9.2 Binding effects
2.6.9.3 Amendments
2.6.10 Effects of non-use of corporate charter
2.7 Corporate powers
2.7.1 General powers; theory of general capacity
2.7.2 Specific powers; theory of specific capacity
2.7.3 Power to extend or shorten corporate term
2.7.4 Power to increase or decrease capital stock or incur, create,
increase bonded
2.7.5 Power to deny pre-emptive rights
2.7.6 Power to sell or dispose corporate assets
2.7.7 Power to acquire own shares
2.7.8 Power to invest corporate funds in another corporation or
business
2.7.9 Power to declare dividends
2.7.10 Power to enter into management contract
2.7.11 Ultra vires acts
2.7.12 Doctrine of individuality of subscription
2.7.13 Doctrine of equality of shares
2.7.14 Trust fund doctrine
2.8 Stockholders and members
2.8.1 Fundamental rights of a stockholder
2.8.2 Participation in management
2.8.2.1 Proxy
2.8.2.2 Voting trust
2.8.2.3 Cases when stockholders' action is
required
2.8.2.4 Manner of voting
2.8.3 Proprietary rights
2.8.3.1 Appraisal right
2.8.3.2 Right to inspect
2.8.3.3 Preemptive right
2.8.3.4 Right to vote
2.8.3.5 Right to dividends
2.8.4 Remedial rights
2.8.4.1 Individual suit
2.8.4.2 Representative suit
2.8.4.3 Derivative suit
2.8.5 Obligations of a stockholder
2.8.6 Meetings
2.8.6.1 Regular or special
2.8.6.2 Notice of meetings
2.8.6.3 Place and time of meetings
2.8.6.4 Quorum
2.8.6.5 Minutes and agenda of meetings
2.8.6.6 Remote communication
2.9 Board of directors and trustees
2.9.1 Repository of corporate powers
2.9.2 Tenure, qualifications, and disqualifications of directors
2.9.3 Corporations vested with public interest
2.9.4 Independent directors
2.9.5 Elections
2.9.6 Removal
2.9.7 Filling of vacancies
2.9.8 Compensation
2.9.9 Disloyalty
2.9.9.1 Business judgment rule
2.9.9.2 Solidary liabilities for damages
2.9.10 Personal liabilities
2.9.11 Responsibility for crimes
2.9.12 Special fact doctrine
2.9.13 Inside information
2.9.14 Contracts
2.9.15 Between corporations with interlocking directors
2.9.16 Executive and other special committees
2.9.17 Meetings
2.9.17.1 Regular or special
2.9.17.2 Who presides?
2.9.17.3 Quorum
2.9.17.4 Remote communication
2.9.17.5 Rule on abstention
2.10 Capital affairs
2.10.1 Certificate of stock
2.10.2 Watered stocks
2.10.3 Payment of balance of subscription
2.10.4 Sale of delinquent shares
2.10.5 Alienation of shares
2.10.6 Corporate books and records
2.10.6.1 Records to be kept at principal office
2.10.6.2 Right to inspect corporate records
2.10.6.3 Effect of refusal to inspect corporate records
2.11 Dissolution and liquidation
2.11.1 Modes of dissolution
2.11.2 Methods of liquidation
2.12 Other corporations
2.12.1 Non-stock corporations
2.12.2 Educational corporations
2.12.3 Religious corporations
2.12.4 One person corporations
2.12.4.1 Excepted corporations
2.12.4.2 Capital stock requirement
2.12.4.3 Articles of incorporation and by-laws
2.12.4.4 Corporate name
2.12.4.5 Corporate structure and officers
2.12.4.6 Nominee
2.12.4.7 Liability
2.12.4.8 Conversion of corporation to one person
Corporations and vice-versa
2.12.5 Foreign corporations
2.12.5.1 Bases of authority over foreign corporations
2.12.5.2 Necessity of a license to do business
2.12.5.3 Personality to sue
2.12.5.4 Suability of foreign corporations
2.12.5.5 Instances when unlicensed foreign corporations may be
allowed to sue
(isolated transactions)
2.12.5.6 Grounds for revocation of license
2.13 Merger and consolidation
2.13.1 Definition and concept
2.13.2 Distinguish: constituent and consolidated corporation
2.13.3 Plan of merger or consolidation
2.13.4 Articles of merger or consolidation
2.13.5 Procedure, effectivity, limitations, and effects
2.14 Investigations, offenses, and penalties
2.14.1 Authority of Commissioner
2.14.1.1 Investigation and prosecution of offenses
2.14.1.2 Contempt
2.14.2 Sanctions for violations
2.14.2.1 Administrative sanctions
2.14.2.2 Prohibited Acts
2.14.2.3 Penalties
2.14.3 Who are liable?
2.14.4 Authority of the Securities and Exchange Commission
2.15 Corporate Governance
2.15.1 Publicly listed companies
2.15.2 Public companies and registered issuers
2.16 Securities
2.16.1 Kinds of securities
2.16.2 Procedure for registration of securities
2.16.3 Prohibition on fraud, manipulation, and insider trading
2.16.4 Protection of shareholder interests
2.17 Securities Regulation Code (SRC) Rule 68
2.17.1 General Financial Reporting requirements
2.17.1.1 Application and definition of terms
2.17.1.2 Guides to financial statements preparation
2.17.1.2.1 Financial reporting framework
2.17.1.2.2 Responsibility for financial statements
2.17.1.3 Qualifications and reports of independent auditors
2.18 SEC Issuances
2.18.1 Memo Circulars
2.18.2 Opinions
- NOTHING FOLLOWS -
