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Everything You Need to Know About Mergers and Acquisitions

Have you ever heard of mergers and acquisitions? Many new people in the business world often misunderstand this term and what it entails. Others may only have a surface-deep level understanding. Simply put, mergers and acquisitions is the general term describing the process of combining two business entities into one.  Here’s what you need to know. What is the difference between mergers and acquisitions? Mergers and acquisitions, or M&A, is the umbrella term for the consolidation of two companies. However, there is still a difference between a merger and an acquisition. These two terms, when used on their own, are not interchangeable. A merger occurs when two businesses combine into a new, third legal entity. On the other hand, an acquisition occurs when a company purchases and absorbs another company.  A merger usually occurs between two entities of roughly the same size. There is an amicable relationship between the two companies, and their respective CEOs must agree that this is the best strategic move for both sides. The companies may either choose a new name for their new company or continue using one of the existing company names. Both companies also have to surrender their old stock, as new stock must be issued under the name of the new business entity. This is why it’s important to ensure that both companies completely agree with the merger. On the other hand, acquisitions occur when one company absorbs another. It can be a friendly takeover, which is the case if the acquired company agrees with and is willing to undergo the acquisition. If the acquired company did not want to be bought, however, the acquisition is then referred to as an unfriendly or hostile takeover. The acquiring company keeps its name as it absorbs the acquired company, which will cease to exist under its own name. The acquiring company would also own any previously owned assets of the acquired company. What are the advantages and disadvantages of mergers and acquisitions? M&A is a major decision a company shouldn’t take lightly. It’s important to be intimately aware of its advantages and disadvantages before you commit your company to a M&A transaction. Here are some of the pros and cons of M&A before you commit. The advantages of M&A: The disadvantages of M&A: We hope that you keep this information in mind as you determine the best strategic move for your company. We wish you luck on your business endeavors!

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What You Need to Know About Types of Intellectual Property

Do you know the differences between patents, copyrights, and trademarks? These terms all refer to different types of intellectual property, which can help prevent your work from being stolen by anyone else. Their best way to differentiate them is to know what each one protects.  If you’re starting your own business, it’s important to protect your branding and your product for your endeavor to succeed. But which of these do you really need, and how do they differ from the other? Here’s what you need to know about patents, copyrights, and trademarks. What is a patent? A patent is a property right granted to creators of new inventions or processes. These can include simple devices like mouse traps, complex machinery for factories, or pharmaceutical drugs. An invention or solution can only be patented if it is new, innovative, and industrially useful.  While you can sell or use your invention without a patent, there is a risk that it will be copied by another party. Having your invention patented can prevent others from profiting off of it, either through making, using, or selling said invention. You can also grant other parties the rights to your invention, so long as both parties agree on mutual terms. Alternatively, you can sell your rights over the patented invention to another party. This relinquishes your rights on the creation and passes it onto the other party instead. Note that there are certain inventions and solutions that cannot be patented. These include aesthetic creations, abstract ideas, discoveries and other scientific theories, methods of treatment, animal breeds or plant varieties, computer programs, and any work against public morality. If you want your invention to be granted a patent, you’ll have to file an application to the Bureau of Patents of the Intellectual Property Office of the Philippines (IPOPHIL). Note that patent protection only lasts up to twenty (20) years from the date it was filed, and this cannot be renewed.  What is a copyright? Copyright protects an owner’s literary, scientific, or artistic creations. Books, songs (with or without words), illustrations, photographs, cinematographic works, and computer programs are some of the many works that copyright protection covers. If you’d like to have your work protected under copyright law, you will need to register it with the Intellectual Property Office (IPOPHIL). In the Philippines, copyright protection lasts for the entirety of the author’s lifespan, plus an additional fifty (50) years after the author’s death. Once such copyright protection expires, it enters the public domain, granting the public free access and rights to use it in any way they want. Derivative works, which are based on works that already exist, are also protected by copyright. Creators who want to create something based on an existing piece will not be violating the original piece’s copyright protection. Examples of derivative works include adaptations, translations, or other alterations of literary or artistic works. Collections of works, such as a short story collection, are also considered derivative works. While copyright protection covers a fast number of literary, scientific and artistic creations, there are some works that are unprotected. These include: In addition, no copyright shall subsist in any work of the Government of the Philippines. This is all according to the Intellectual Property Code. What is a trademark? A trademark identifies your brand and helps differentiate it from your competitors. A trademark can be a word, phrase, symbol, or a combination of the three. However, unorthodox trademarks exist, such as sounds, colors, and even smells. A unique trademark is a great way to help consumers remember your brand. Some well-known examples of trademarks include Nike’s check mark symbol or Pepsi’s blue and red circle. A registered trademark prevents your competitors from using not only your trademark, but also anything similar to it. This can help you set your brand apart from the crowd. It also prevents anyone from imitating your brand to ruin its reputation or get its consumer base.  Similar to copyrights, you can file a trademark application with the Intellectual Property Office of the Philippines. Trademark protection in the Philippines only lasts ten (10) years from the date of registration, but you can also renew it every ten (10) years. A trademark can thus theoretically last forever as long as it keeps getting renewed. Now that you know the differences between the different types of intellectual property, you can identify which ones apply to your brand so you can protect your work accordingly.

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What to Know About Establishing a Corporation

Having ownership of a corporation can open up many new possibilities for your business, especially compared to having a sole proprietorship or a partnership. You might not want to have personal liability on your business anymore, or perhaps you’d like to seek out investors by offering them stock. A corporation can offer you growth that the other two business entities can’t achieve. In the final part of this series, we’ll be discussing the final type of business entity that you can create. If you’re thinking of incorporating your business, here’s what you need to know. What is a corporation? A corporation is a business structure that is its own legal entity. This means that it exists independently of its owners and/or incorporators and has the same rights and obligations of an individual. Its ownership is divided into stock shares; individuals and other businesses who possess the stock of a corporation are its owners or stockholders. A corporation differs from a partnership because partnerships aren’t considered a legal entity. Additionally, partnerships only require two or more individuals to form, while corporations need a minimum of five and a maximum of fifteen. What are the advantages and disadvantages of a corporation? There are several advantages to incorporating your company. Firstly, any risk and liability you may encounter will only affect the corporation itself, and owners are not personally liable. It can also easily be passed down to different owners and live indefinitely, ensuring that it will continue to persist even after its owners are no longer around.  On the other hand, it does have its own disadvantages that you should consider if you want to incorporate your company. It is the most challenging business structure to set up in terms of expenses and paperwork. It also generally has a higher capital requirement and operation cost. Finally, corporations are subject to more compliance requirements and laws compared to partnerships and sole proprietorships. How do you establish a corporation? There are many similarities between the steps for establishing a corporation and a partnership, so expect to see many of the same steps that we’ve discussed in our previous article regarding partnership businesses. Here’s what you need to do to establish a corporation:  All partnerships and corporations must secure a certificate of registration with the Securities and Exchange Commission, or SEC, in order to operate. You can start off by going to their website to check the availability of the name of your business and fill out the application form. However, you can also do this at your nearest SEC office. To register your business in the SEC, you’ll have to prepare and notarize a few documents. These are your organization’s by-laws and articles of incorporation, the joint affidavit of at least two incorporators, and an affidavit of your organization’s treasurer. You’ll also need your name reservation/verification slip, your cover sheet, and your registration data sheet. Since you’ll be setting up your organization in your barangay, it’s important to get your business a barangay clearance. This ensures your community that your business adheres to the standards of their local Barangay. To complete your application, you’ll need your Certificate of Business Registration from the SEC, two (2) valid IDs, and a proof of address. This can be the contract of your lease if your location is rented, or your Certificate of Land Title if you own your own location. Similar to your Barangay Clearance, you’ll need a Business Permit or Mayor’s Permit so that you can run your business in your municipality. These permits are also proof that your business meets the standards of the Local Government Unit, or LGU. Note that these permits do have an expiration date, as they must be renewed once a year. Note that you’ll only be able to get these permits after you’ve secured the other requirements in the previous steps: a Certificate of Registration from SEC and a Barangay Clearance. You’ll also need two (2) valid IDs and a proof of address, similar to what you provided when applying for your Barangay Clearance. You’ll need to register with the Bureau of Internal Revenue or BIR to comply with tax obligations. Registering with the BIR will also grant you permission to issue official receipts, register books of accounts, and obtain a separate Tax Identification Number for your business.To complete your registration, you’ll need to accomplish BIR Form 1903 – Application for Registration (For Partnerships/Corporations). Besides your complete BIR Form, you’ll also need to submit your previously completed Certificate of Registration from the SEC, Barangay Clearance, and Business or Mayor’s Permit. You’ll also need proof of address and a valid ID. Then, register your account books and up-to-date invoices. After this, you’ll finally get your BIR Certificate of Registration. Finally, register with these government-mandated agencies as an employer. You will need to register your employees with the Philippine Health Insurance Corporation (Philhealth) and the Home Development Mutual Fund (HDMF) and remit their shares of contribution to the aforementioned agencies. Philhealth is responsible for providing your employees with health insurance, while the HDMF administers the Pag-IBIG Fund, which provides affordable financing for its members’ housing needs. You’ll also need to register both your business and your employees in the SSS so you can properly remit your employees’ monthly contributions.  This concludes our series about establishing your own business. Whether you plan on opening a sole proprietorship, partnership, or corporation, we hope that our guides have given you insight on the process you’ll have to go through.

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Everything You Need to Know About the Kinds of Audits

What do you know about audits? An audit is an evaluation of a company’s process or quality system to ensure that it complies with rules and regulations. Audits can be done internally by the employees of the company, an independent auditor, or an outside firm.  Many people associate the word “audit” with financial audits, wherein an independent party evaluates a company’s financial statements. However, there are many different types of audits used to evaluate a company. Here are the three common types of audits. Financial Audit As aforementioned, financial audits are a thorough evaluation of an organization’s financial statements and accounts. This is to make sure that a company is representing their finances truthfully and accurately. It’s also done to ensure that the company is complying with the laws of the government. During a financial audit, your auditor will most likely review your account balances, transactions, financial statements, historical documents, internal documents, financial statements, and financial commitments such as loans. Besides government compliance, you can gain several benefits from getting an audit. An audit can point out any accidental errors and discrepancies, but it can also possibly detect cases of real financial fraud. Financial audits can also take an overall look at the organization’s financial performance to see which areas need improvement and which can be streamlined and optimized. Internal Audit Internal audits evaluate the organization’s internal controls, which are described as the accounting processes used by the company’s finance department. This includes its risk management, corporate governance, and accounting processes. Similarly to the other types of audits, one of its main goals is to ensure compliance with the set rules and regulations.  There are several types of internal audits. Risk management, for example, focuses on detecting and preventing cases of fraud or abuse. It can also check the organization’s work culture, ethics, and morale and evaluate what can be improved. Environmental audits evaluate the organization’s impact on the planet, so that it can strive to turn to more eco-friendly strategies in the future. While internal audits usually aren’t compulsory, it can help managers learn more about their organization’s potential, its strengths and weaknesses, and what direction it is currently going. By doing so, business owners can take steps towards improving their company further. Internal audits are done by the company’s in-house auditing team. Operational Audit Finally, operational audits examine the organization’s day to day and overall operations to check its efficiency and effectiveness. This type of audit goes beyond financial concerns and takes a look at the organization as a whole.  Your auditor would want to observe different aspects of your organization, depending on the type of operational audit. For example, department audits can specifically look at the procedures and processes of the marketing team or HR team. If changes are implemented around the company after an initial operational audit, a follow-up audit may be done later on. Similarly to internal audits, operational audits are all about finding new ways to make business operations smoother and easier. Auditors can offer managers a new perspective on their business operations, find blind spots that you may have swept past, and offer changes with its own opportunities and risks. Unlike internal audits, however, operational audits cannot be done in-house. Instead, companies would hire an expert to do the audit for them. If you’re looking for trustworthy auditors to perform audits for your business, consider booking a consultation with Sadsad Tamesis Law and Accountancy Firm.

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4 Reasons Why Bookkeeping in Accounting is Important

Bookkeeping refers to the constant and consistent recording of an organization’s complete financial transactions. This includes purchases, sales, receipts, and payments. Bookkeepers should create an organization’s record before they begin creating transactions, so that each one can be properly recorded.  But is bookkeeping that important? What benefits does it offer an organization? Here are four reasons why bookkeeping is essential for all corporations. Organized Record Keeping Sometimes having unorganized records feels worse than not having any records at all. The chaos of going through your files, especially under a deadline, can add an unnecessary amount of stress to workload. Doing your books often and keeping all of your records in one place cuts out a lot of work and stress for everyone in your team, letting you find what you need in no time. This is especially applicable if you do your bookkeeping digitally, as everything can be stored in one file and searched in less than a few seconds. Budgeting and Forecasting Creating and adhering to a budget is one of the key ways to make your organization succeed. Bookkeeping can help your budgeting in two different ways. Firstly, consistent bookkeeping will tell you how much you spend and gain in a given time, which can help if you’re trying to create a new budget within the organization’s limits. Secondly, bookkeeping keeps track of where your money comes and goes. Having such a clear visual can help you see if you’re adhering to your budget or not, and if you’re going overboard with your expenditures. Audit Readiness Your company must always meet the government’s rules, policies, and procedures in order to keep running legally. To ensure this, you’re required to submit a financial audit once a year. Seeing as that’s a whole year of activities, it may be challenging to retrieve those documents as the deadline approaches. Bookkeeping, whoever, records all financial transactions from the beginning of your organization’s life till the end. Having a bookkeeper means you have easy access to your records, meaning you’re fully prepared at all times for the day of your financial audit. Risk Management A company that doesn’t keep records of its transactions is seriously prone to data theft, financial discrepancies, and financial fraud. You may not know that you’re a victim of such crimes until it’s too late. Bookkeeping lowers these risks significantly by keeping close track of all of the organization’s legitimate transactions. Any discrepancies would be immediately found out, lowering the risk and probability of this crime ever occurring to you.

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Legislative Naturalization: How to Become a Filipino Citizen

What is the fastest way for a foreigner to become a Filipino citizen? There are several ways a foreigner can attain citizenship, depending on their circumstances. Someone born and raised in the Philippines can attain citizenship through judicial naturalization. Meanwhile, a foreigner of any other circumstance may go through administrative naturalization. However, there are some special cases wherein a foreigner can become a Filipino citizen through legislative naturalization. Our previous articles have discussed judicial naturalization and administrative naturalization. In the final part of our series about naturalization, we will be discussing legislative naturalization. Here’s what you need to know.  What is Legislative Naturalization? Legislative naturalization is another way to gain Filipino citizenship. It is a direct grant of citizenship by Congress to qualified foreigners. One can only attain citizenship through legislative naturalization if he or she has made a significant contribution to the country and its people. This is in contrast to judicial and administrative naturalization, which call for the possession of various qualifications. They also require the filing of petitions accompanied by specific requirements, as can be seen in the previous articles. Qualifications to get Naturalized If you have read our previous article on judicial and administrative naturalization, these qualifications may look familiar. This is because the modes of acquiring citizenship through naturalization have identical qualifications. However, for legislative naturalization, since citizenship is directly granted by Congress, those qualifications do not need to be strictly met. It is the prerogative of Congress, based on one’s significant contribution to the country, to grant such citizenship. However, nothing bars Congress from using the same qualifications as a guide in granting citizenship, which we will be reproduced here: In addition, the ten (10) years of continuous residence required under the second condition can be reduced to five (5) years if the petition has any of the following qualifications: Process of Achieving Citizenship Achieving citizenship through legislative naturalization is a process that mirrors that of passing a bill. The process begins with the filing of a bill by a member of one of the two houses of Congress. The two houses of Congress are the House of Representatives and the Senate of the Philippines. A naturalization bill must undergo three readings in the house of Congress where it originates. For example, if a member of the Senate of the Philippines filed the naturalization bill, the bill must then pass three readings in the Senate. These readings must also all take place on separate days. This process is covered by Section 26, paragraph 2 of the 1987 Constitution. If the bill passes all three readings and receives a majority affirmative vote from the members, it will be transmitted to the other house of Congress and undergo the same procedure. For example, if a bill is approved by the Senate of the Philippines, it must then be transferred to the House of Representatives. The bill must also pass all three readings on separate days in the House of Representatives. If the bill is approved by both houses of Congress, copies of the bill will also be transmitted to the President of the Philippines. If the President approves of and signs the bill, the bill officially becomes a law.  Once the bill has been approved by the President, all the applicant needs to do is wait for the publication of the naturalization law, take the Oath of Allegiance, and receive the issued Certificate of Naturalization by the Bureau of Immigration. This grants the applicant Filipino citizenship, and he or she will attain the full rights and responsibilities of a Filipino citizen.

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What to Know About Establishing a Partnership Business

Do you prefer to work alone, or would you rather have teammates by your side to fall back on? Many people often opt to go into a partnership when starting their own business. It can be considered the best of both worlds, after all. With a smaller team, you can still enjoy a reasonable size of the overall profit. Plus, you’ll have others to rely on in case any issues arise. These types of businesses also have a lot of room for capital and growth. In the first part of this series, we discussed how you can register a sole proprietorship. Today, we’ll be discussing the second type of business entity you could create. Do you want to start a partnership business of your own? Here’s everything you need to know. What is a partnership business? A partnership business is a business structure wherein two or more people agree to share ownership of the business. This makes them able to split their profits amongst each other, but this also means that all partners in a business are equally liable to any losses. Partnerships and corporations have a few similarities, namely the fact that it involves several people contributing to the business. However, it also has many differences. For example, while a partnership allows partners to transfer interest to each other, the transferee during the transaction does not automatically become a partner unless all of the partners in the corporation consent. On the other hand, in corporations, transferees involved in a transfer of shares of stock become stockholders of the corporation. Partnerships also tend to be smaller in size compared to corporations. How do you register a partnership business? 1. Register your business in the Securities and Exchange Commission. All partnerships and corporations are required to secure a certificate of registration with the Securities and Exchange Commission, or SEC, in order to operate. You can start off by going to their website to check the availability of the name of your business and fill out the application form. You can also do this at your nearest SEC office. To register in the SEC, you’ll need a Name Verification Slip and Articles of Partnership. There are also some additional requirements that you’ll need, depending on your circumstances. You’ll need a Joint Affidavit to change your partnership name, provided that it isn’t already included in your AP. You’ll also need a FIA Form-105 if one of your business partners is a foreigner.  2. Get a Barangay Clearance. Since you’ll be setting up shop in your barangay, it’s important to get your business a barangay clearance. This ensures your community that your business adheres to the standards of their local Barangay.  3. Register your business and employees in the Social Security System. Unlike many sole proprietorships, you certainly will not be working alone in this business. Other people – aside from your partners – will be working in your business as employees. Because of this, you’ll need to register both your business and your employees in the SSS so you can properly remit your employees’ monthly contributions.  To register in the SSS, you’ll need to fill out SS Forms R-1 and R-1A. You’ll also need a photocopy of your Articles of Partnership, a sketch or map of your business’s location, and a Validated Miscellaneous Payment Return. 4. Apply for a Business or Mayor’s Permit Similar to your Barangay Clearance, you’ll need a Business Permit or Mayor’s Permit so that you can run your business in your municipality. These permits are also proof that your business meets the standards of the Local Government Unit, or LGU. Note that these permits do have an expiration date, as they must be renewed once a year. Note that you’ll only be able to get these permits after you’ve secured all the other requirements in the previous steps: a Certificate of Registration from SEC, a Barangay Clearance, and a registration with the SSS.  There are also other requirements, besides those aforementioned, that you must acquire before you can obtain a Business or Mayor’s Permit. You’ll need a Business Permit Application Form, an Authorization Letter and IDs of the owner/s, and a Community Tax Certificate. If you’re renting a space for your business, you’ll need to provide the contract of your lease; if you own the place of business, bring your land title or tax declarations. Finally, you’ll need Public Liability Insurance if your business is a restaurant, cinema, mall, etc. 5. Register with the BIR Finally, you’ll need to register with the Bureau of Internal Revenue or BIR to comply with tax obligations. Registering with the BIR will also grant you permission to issue official receipts, register books of accounts, and obtain a separate Tax Identification Number for your business.  Note that you’ll need to obtain your Business Permit and Certificate of Registration from the SEC before registering with the BIR, as they are some of the requirements you’ll need to submit. You will also need the BIR Registration Form 1903 and Articles of Partnerships. 6. Register your business with other government-mandated agencies. You can register your business with other government-mandated agencies once it has begun its operations. You will need to register your employees with the Philippine Health Insurance Corporation (Philhealth) and the Home Development Mutual Fund (HDMF) and remit their shares of contribution to the aforementioned agencies. Philhealth is responsible for providing your employees with health insurance, while the HDMF administers the Pag-IBIG Fund, which provides affordable financing for its members’ housing needs. We hope that this article has helped kickstart your partnership business. Look forward to our last part of our series about different business types, we will be discussing how to register a corporation.

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How to Start a Sole Proprietorship in the Philippines

Are you thinking of starting a business? There are many important decisions that you must make when conceptualizing your own business. A critical one you’ll have to make is which type of business entity it will be. Would you rather have full authority,  split the responsibilities between yourself and a few business partners, or have a board of directors by your side? If you choose to pursue this goal alone, you must be ready for the workload ahead of you. In this article, we’ll be discussing sole proprietorship. What is a sole proprietorship? A sole proprietorship is a business structure in which you, as the founder, have full control and authority over the business. You also own all of the assets of the business and get to enjoy the profit without having to split it with a partner or co-founder. However, the downside is that you alone will be liable for any debts or losses of the business. Sole proprietorships are great for small-scale businesses since they’re the easiest to manage. For example, a small online bakeshop can be a sole proprietorship.  How do you register a sole proprietorship? Another advantage of starting a sole proprietorship is that it has the easiest and least complicated registration process. Here is a quick overview on how to register a sole proprietorship so you know what to expect.  First, you’ll have to register your business name so that no one else will get to use it. The DTI eBNRS online portal provides you with the option to register your business name online.  When registering at the DTI, it’s critical to ensure that your brand name is unique. You can use DTI’s Business Name Search to double-check if your brand name idea is already taken by an existing business. Once you have a unique business name, fill out the application form and pay the fee. You should receive your Certificate of Registration shortly afterwards. To proceed with your business, you’ll need to register it with the Local Government Units. First, you’ll have to register with the barangay. To do so, you’ll need to prepare two (2) valid IDs, your Proof of Residency, and your DTI Certificate of Registration. Once you’ve paid the fee, you will soon receive your Barangay Certificate of Business Registration. The other Local Government Unit you must register your business in is with the Mayor’s Office. You’ll need two (2) valid IDs, your Proof of Residency, your DTI Certificate of Registration, and your Barangay Certificate of Business Registration.  While you’re here, you can also process other permits that you may need, especially if your business will have a physical store. These include the Fire Permit, Sanitary Permit, Locational Clearance, etc. However, if you’re a freelancer or you’re running an online business, you can skip this step. Finally, it’s time to register your business with the BIR. Firstly, you’ll need to fill out the BIR Form 1901, which is the application to register a business for Sole Proprietors. You’ll also need to fill up and pay for the BIR Form 0605, as this form is how taxpayers pay any taxes and fees that do not require the use of a tax return. The requirements you’ll need to prepare are a valid government ID, your Proof of Residency, and your DTI Certificate of Registration.  While you’re at it, fill out the application for registering your books of accounts and receipts/invoices. You can do so using BIR Form 1905. You’ll be all done with the registration process once you’ve claimed your Certificate of Registration and your book of accounts and invoices.We hope that this article has helped any aspiring entrepreneurs who are aiming to create their own sole proprietorship. This ongoing series will also be discussing the other business entity types, such as partnerships and corporations. Look forward to what else Bits of Law has to offer in the future!

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Conjugal Property: What You Need to Know

What does it mean to be married? When people think of marriage, they may first think of sharing their lives together with someone they love for the rest of their lives. From that moment on, they work as a team so that they can have a better future. Because they now share a life together, they usually begin sharing material possessions, such as a house and lot, a car, or other valuable items. However, some confusion may arise on whether a particular property is owned by one spouse, the other, or both. To answer these questions and more, we must first learn the basics of conjugal property. What is a conjugal property? Simply put, conjugal property is property that belongs to both spouses. This may include property that is obtained from either or both of the spouse’s profession, or income from the spouse’s exclusive property. How does a property become conjugal? The individual spouses both have a choice on whether their property becomes conjugal property or not, but only before the marriage. Both spouses may want to jointly own some properties while leaving others for themselves. If they would like to specify which property they would like to form part of conjugal property, they will need a prenuptial agreement. But what about any property obtained after the marriage papers have been signed? According to Article 116 of the Family Code of the Philippines, “all property acquired during the marriage, whether the acquisition appears to have been made, contracted or registered in the name of one or both spouses, is presumed to be conjugal unless the contrary is proved.”  Essentially, all property that is obtained by the couple during their marriage will always be owned by both spouses. What is a property regime, and what are the 3 regimes available? A property regime determines how a couple’s property relations are governed during their married life. If they execute a prenuptial agreement, they have the option to choose their property regime. If not, the default property regime will be applied. Here are the three available property regimes: ·      Absolute Community of Property has been the default property regime since August 3, 1988, which is the date of effectivity of the Family Code. This means that all marriages celebrated on or after this date where no prenuptial agreement was executed by the spouses  are governed by this property regime. Absolute Community of Property, under the Family Code, dictates that all property owned by either spouse becomes conjugal property after the marriage–even those owned by them before they got married. ·      Conjugal Partnership of Gains was the default property regime before the effective date of the Family Code. Conjugal Partnership of Gains still governs all marriages that took place before August 3, 1988, provided that the spouses didn’t execute a prenuptial agreement. This property regime equally divides the net gains acquired during the marriage between the two spouses. ·     Complete Separation of Properties is the option for couples who would rather not jointly own any of their properties. There is no conjugal property, and both spouses continue to own whatever property they already originally owned. A couple can choose this property regime with a prenuptial agreement before the marriage is celebrated. What happens to conjugal property if the couple separates? The conjugal partnership is terminated when the marriage of the spouses is nullified, annulled, or if the spouses undergo legal separation. Moreover, the spouses can also file a petition to have the absolute community or the conjugal partnership of gains voluntarily dissolved. Article 135 of the Family Code also enumerates the grounds considered as sufficient causes whereby one of the spouses can institute judicial proceedings for the separation of their property. Finally, conjugal partnership is terminated if one of the spouses dies. This overview of the concept of conjugal property barely scratches the surface of how to handle property as a couple, whether it be before, during or after a marriage. In the next part of this ongoing series about conjugal property, we will be going into more depth about the types of property regimes available. This way, a marrying couple knows the options available to them in regards to their property.

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How to Become a Filipino Citizen Through Administrative Naturalization

Is it possible to be born and raised in the Philippines, and yet not be a Filipino citizen at all? A child born in the Philippines would always be granted Philippine citizenship as long as one of their parents is a Filipino citizen. However, if both parents are foreigners, the child will not be granted Philippine citizenship. If the said parents choose to stay and raise the child in the Philippines, the latter may apply for Philippine citizenship once he or she reaches the age of eighteen (18). To achieve this, he or she would have to go through administrative naturalization. One of our previous articles discussed everything there is to know about judicial naturalization. To recap, judicial naturalization is the best procedure for foreigners who were not born and raised in the Philippines. In the second part of this series about naturalization, we will be diving into administrative naturalization.  What is Administrative Naturalization? Administrative naturalization is the legal process of granting a foreigner Filipino citizenship by naturalization, provided that such foreigner was born and raised in the Philippines. Usually, this occurs when a child’s parents are both foreigners, yet chose to raise him or her in the Philippines and not in their country of origin.  This process is governed by Republic Act No. 9139, otherwise known as the Administrative Naturalization Law of 2000. This is an act providing for the acquisition of Philippine Citizenship for certain aliens by administrative naturalization and for other purposes. Qualifications to get Naturalized There are many similarities between the qualifications to obtain Philippine citizenship through judicial and administrative naturalization. Any person desiring to avail the benefits of administrative naturalization must: Note that this shall not apply to applicants who are college degree holders but are unable to practice their professional because they are disqualified to do so by reason of their citizenship; Disqualification from Naturalization An applicant can get disqualified from applying for administrative naturalization if they meet any of the following disqualifications. Note that this list is identical to the disqualifications from applying for judicial naturalization. An applicant is disqualified if he or she: Petition Requirements There are many documents an applicant must secure before he/she files a petition. Preparing these in advance can help make the naturalization process smoother and faster. An applicant must ensure to accompany his/her application with the following: Filing of the Petition An applicant can file his or her petition with the secretariat of the Special Committee on Naturalization. He/she will need to create five copies of the petition, all of which must be legibly typed and signed, thumbmarked and verified, and with a passport-sized photograph of the applicant attached to each copy. The petition must then set forth the following information about the applicant: If the petition is complete in substance and in form, the Committee will immediately publish it in a newspaper of general circulation once a week for three consecutive weeks. The applicant will have to coordinate with and pay the newspaper company regarding the publication of his or her petition.  The committee will also forward the petition to the National Bureau of Investigation, the Department of Foreign Affairs, the Bureau of Immigration, and the petitioner’s local Civil Registrar. The petition will be posted in the offices of these government agencies. Should the petition be sufficient, the petitioner will have to go through the final test and interview. Should the petitioner also pass this final stage, a date and venue will be set for the oath-taking. Taking the oath will finally turn the petitioner into a full-fledged Filipino citizen and the Certificate of Naturalization will be forwarded to the Bureau of Immigration and the local Civil Registrar.

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