How to Increase Authorized Capital Stock in the Philippines

Planning to expand your business or bring in new investors? Increasing your Authorized Capital Stock (ACS) is a common step for growing corporations in the Philippines.

This guide breaks down the process in simple terms so you can stay compliant and avoid delays.

What Is Authorized Capital Stock?

Authorized Capital Stock (ACS) is the maximum amount of capital a corporation is allowed to raise through the issuance of shares.

When your current capital is no longer enough to support growth, you may need to increase it.

Why Increase Authorized Capital Stock?

Businesses typically increase their ACS for several reasons:

• To raise additional funds from investors

• To support business expansion or new projects

• To improve financial capacity or credibility

• To comply with regulatory or industry requirements

Key Requirements Under Philippine Law

Before increasing your capital stock, take note of these legal requirements:

• Approval from the Board of Directors

• Approval from stockholders representing at least 2/3 of outstanding capital stock

• Proper documentation and SEC filing

  
  

Step-by-Step Process to Increase Authorized Capital Stock

1. Secure Board Approval

The process starts with a Board Resolution proposing the increase in authorized capital stock.

• Conduct a board meeting

• Approve the proposed increase

• Set the details (amount, share structure, etc.)

  
  

2. Obtain Stockholders’ Approval

Next, secure approval from stockholders:

• At least 2/3 of outstanding capital stock must approve

• This is usually done during a stockholders’ meeting

3. Amend the Articles of Incorporation

You’ll need to update your Articles of Incorporation to reflect the new capital structure.

This includes:

• New authorized capital amount

• Updated number of shares

• Par value per share (if applicable)

  
  

4. Prepare Required Documents

Typical documents include:

• Amended Articles of Incorporation

• Treasurer’s Affidavit

• Secretary’s Certificate

• Board and Stockholders’ Resolutions

  
  

Ensure all documents are accurate and consistent.

5. Pay Filing Fees

The SEC requires payment of filing fees based on the amount of increase.

Additional taxes may apply, such as:

• Documentary Stamp Tax (DST)

• Other regulatory fees (if applicable)

  
  

6. File with the SEC

Submit your documents through:

• SEC eFAST system (online), or

• Physical filing (if required)

  
  

Once approved, your increased authorized capital stock becomes official.

Important Reminders

✔️ Ensure all approvals are properly documented

✔️ Double-check figures and computations

✔️ Keep records updated after approval

✔️ Coordinate with accountants for tax compliance

Common Mistakes to Avoid

• Inconsistent information across documents

• Missing signatures or certifications

• Securing the required 2/3 stockholder approval

• Incorrect computation of fees and taxes

  
  

Avoiding these issues can help speed up SEC approval.

How Long Does the Process Take?

Processing time varies depending on:

• Completeness of documents

• Accuracy of submission

• SEC workload

  
  

On average, it may take a few days to several weeks.

Why Increasing Authorized Capital Stock Matters

Updating your capital structure allows your business to:

• Attract investors

• Scale operations

• Strengthen financial standing

• Stay competitive in your industry

  
  

Need Help with Capital Increase?

While the process is straightforward, errors can cause costly delays. Professional guidance ensures compliance and a smoother filing experience.