How to Register a Partnership with SEC
A partnership is a business structure where two or more persons bind themselves to contribute money, property, or industry to a common fund with the intention of dividing profits among themselves. In the Philippines, partnerships are governed primarily by the Civil Code of the Philippines (Republic Act No. 386) and must be registered with the Securities and Exchange Commission (SEC) when the capital is ₱3,000 or more. Partnership registration with the SEC grants the partnership a juridical personality separate from its individual partners, allowing it to enter into contracts, own property, and sue or be sued in its own name.
Unlike corporations which are governed by the Revised Corporation Code (Republic Act No. 11232), partnerships follow the provisions of the Civil Code on partnerships (Articles 1767 to 1867). The SEC serves as the registering authority for all partnerships with capital of ₱3,000 or more, ensuring compliance with legal requirements and providing public notice of the partnership's existence. Registration is mandatory before the partnership can legally commence business operations.
Types of Partnerships in the Philippines
Philippine law recognizes several types of partnerships, each with distinct characteristics regarding liability, management, and purpose. Understanding the differences is crucial before choosing which type to register:
- General Partnership — All partners are general partners who participate in the management of the business and are jointly and severally liable for partnership debts and obligations. Each general partner can bind the partnership through their actions. This is the most common type of partnership in the Philippines.
- Limited Partnership — Composed of one or more general partners who manage the business and one or more limited partners who contribute capital but do not participate in management. Limited partners' liability is limited to their capital contribution. The partnership name must include the word "Limited" or "Ltd."
- Professional Partnership — Formed by persons who are licensed to practice a profession, such as lawyers, doctors, accountants, engineers, or architects. Professional partnerships are exempt from income tax at the partnership level; instead, each partner reports and pays income tax on their respective share of the net income.
⚠ Important Warning: Unlimited Liability for General Partners
In a general partnership, all partners have unlimited personal liability for the debts and obligations of the partnership. This means that if the partnership's assets are insufficient to cover its debts, creditors can go after the personal assets of any general partner — including personal savings, real property, vehicles, and other personal belongings. Partners are jointly and severally liable, meaning a creditor can collect the entire debt from any one partner.
The Articles of Partnership is the most critical document in forming a partnership. It must clearly state the names of the partners, their respective contributions, profit-sharing ratios, the firm name, principal place of business, and the duration of the partnership. Any ambiguity in the Articles of Partnership can lead to disputes among partners, especially regarding profit distribution, management responsibilities, and dissolution procedures.
Before forming a partnership, consult a lawyer to ensure that the Articles of Partnership adequately protect all partners' interests and clearly define rights, obligations, profit-sharing arrangements, and exit strategies.
Step-by-Step Registration Process
Follow these seven steps to register your partnership with the Securities and Exchange Commission. The process is conducted primarily through the SEC Company Registration System (CRS) online portal, though some steps may require in-person submission depending on your circumstances.
Choose Your Partnership Type
Before starting the registration process, determine which type of partnership best suits your business needs. The choice between a general partnership, limited partnership, or professional partnership will affect the liability structure, management rights, tax treatment, and required documentation for your registration.
Key considerations when choosing:
- General Partnership: Best for small businesses where all partners want equal participation in management and decision-making. All partners share unlimited liability.
- Limited Partnership: Ideal when some partners want to invest capital without actively managing the business. Limited partners enjoy liability protection up to their capital contribution.
- Professional Partnership: Required when all partners are licensed professionals practicing the same profession. Offers tax advantages as the partnership itself is not subject to income tax.
Reserve Your Partnership Name (SEC CRS)
Log in to the SEC Company Registration System (CRS) at crs.sec.gov.ph and reserve your proposed partnership name. The name must be distinguishable from existing registered entities. The SEC will check whether your proposed name is available or if it conflicts with the names of other registered corporations, partnerships, or associations.
Partnership naming guidelines:
- The partnership name must not be identical or confusingly similar to any existing registered entity
- For limited partnerships, the name must contain the word "Limited" or its abbreviation "Ltd."
- A limited partner's surname must not appear in the partnership name unless it is also the surname of a general partner
- The name reservation fee is ₱100 per proposed name and is valid for 30 days
- You may submit up to three proposed names in order of preference
- Avoid using words that imply government affiliation (e.g., "National," "Philippine," "State") unless authorized
Draft the Articles of Partnership
The Articles of Partnership is the foundational document that establishes the partnership and defines the relationship among the partners. It must be drafted carefully and signed by all partners before a notary public. The SEC provides a standard template that you can use as a guide, but it is highly recommended to have a lawyer review or draft the document.
Required contents of the Articles of Partnership:
- Partnership name — The official name of the partnership as reserved with the SEC
- Purpose or business activity — The specific line of business the partnership will engage in
- Principal office address — The complete address of the partnership's main place of business in the Philippines
- Term or duration — The period for which the partnership is established (may be for a fixed term or at will)
- Names and addresses of all partners — Full legal names, nationalities, and complete residential addresses
- Capital contributions — The amount and nature (cash, property, or industry) of each partner's contribution
- Profit and loss sharing ratio — How profits and losses will be distributed among the partners
- Managing partner designation — Which partner(s) will manage the partnership operations
- Designation of general and limited partners — For limited partnerships, clearly identify which partners are general and which are limited
Prepare Supporting Documents
In addition to the Articles of Partnership, you must prepare and compile the following supporting documents for submission to the SEC. All documents must be complete, accurate, and properly notarized where required.
Required supporting documents:
- SEC Name Reservation Confirmation — Proof that your proposed partnership name has been approved and reserved
- Affidavit of Capital Contribution — A sworn statement detailing each partner's capital contribution (cash, property, or services)
- Bank Certificate of Deposit — Proof that the partnership's initial capital has been deposited in a bank under the partnership's name (for cash contributions)
- Valid IDs of all partners — Government-issued photo identification for each partner (passport, driver's license, UMID, etc.)
- Proof of principal office address — Lease contract, deed of absolute sale, or a secretary's certificate showing the office address
- SEC Cover Sheet — The SEC- prescribed cover sheet form for partnership registration
- Professional Regulation Commission (PRC) IDs — Required only for professional partnerships; all partners must hold valid PRC licenses
- Foreign partner documents (if applicable) — Passport, visa, and Alien Certificate of Registration (ACR) for foreign partners, plus compliance with the Foreign Investments Act
Submit via SEC Company Registration System
Upload all required documents through the SEC Company Registration System (CRS) at crs.sec.gov.ph. The system will validate your submission and check for completeness. If any documents are missing or if there are deficiencies, the system will flag them for correction before proceeding.
Online submission steps:
- Log in to your SEC CRS account (create one if you don't have an account yet)
- Select "Register a Partnership" from the available transaction types
- Enter the approved name reservation number and partnership details
- Fill in the information for all partners including names, addresses, nationalities, and contributions
- Upload scanned copies of all required documents in PDF format
- Review all entered information and uploaded documents for accuracy
- Submit the application and note your SEC reference number for tracking
Tip: Ensure all uploaded documents are clear, legible, and in PDF format. The maximum file size per document is typically 5MB. Blurry or incomplete scans may cause delays in processing your application.
Pay Filing Fees
After your application is validated by the SEC, you will receive an Order of Payment detailing the registration and filing fees. Payment can be made online through the SEC payment portal or at SEC cashier windows. The filing fee for partnership registration is based on the total capital contribution stated in the Articles of Partnership.
Fee breakdown:
- Registration Fee: 1/5 of 1% of the total partnership capital (minimum ₱2,000)
- Legal Research Fee: 1% of the registration fee
- Name Reservation Fee: ₱100 per proposed name (if not yet paid)
- Other Fees: Documentary stamp tax and other incidental fees may apply
Payment methods: Cash (at SEC cashier), bank deposit, online banking, GCash, Maya, or credit/debit card through the SEC online payment portal.
Receive Certificate of Registration
Once all documents are reviewed and approved, and payment has been confirmed, the SEC will issue the Certificate of Registration for your partnership. This certificate officially grants your partnership juridical personality and authorizes it to commence business operations. Processing time is typically 3 to 7 working days from the date of complete submission and payment.
After receiving your certificate:
- Register with the Bureau of Internal Revenue (BIR) to obtain your partnership's Tax Identification Number (TIN) and Authority to Print receipts/invoices
- Apply for a Barangay Business Clearance and Mayor's Permit / Business Permit from the Local Government Unit (LGU) where your business operates
- Register with the Social Security System (SSS), PhilHealth, and Pag-IBIG Fund as an employer (if you will have employees)
- Open a bank account under the partnership's name for business transactions
- File the General Information Sheet (GIS) within 30 days of registration with the SEC
Congratulations! Your partnership is now officially registered and recognized as a juridical entity. Remember to comply with all annual SEC filing requirements (GIS and AFS) to maintain your partnership's good standing.
Complete List of Requirements
Below is a comprehensive table of all documents and requirements needed to register a partnership with the SEC. Ensure you have all items prepared before starting the online application to avoid delays.
| # | Document / Requirement | Description | Notes |
|---|---|---|---|
| 1 | Articles of Partnership | The foundational document establishing the partnership, signed by all partners and notarized | Must follow the SEC-prescribed format; original copy required |
| 2 | SEC Name Reservation | Confirmation that the proposed partnership name has been reserved and approved by the SEC | Valid for 30 days; ₱100 per name |
| 3 | Affidavit of Capital Contribution | Sworn statement detailing each partner's contribution (cash, property, or industry) | Must be notarized; include peso amounts |
| 4 | Bank Certificate of Deposit | Bank certification that the partnership's initial cash capital has been deposited | Must be under the partnership's name; from an authorized bank |
| 5 | Valid IDs of All Partners | Government-issued photo IDs for identity verification of each partner | Passport, driver's license, UMID, PhilID, or PRC ID |
| 6 | SEC Cover Sheet | The SEC-prescribed cover sheet form containing basic partnership information | Available for download from the SEC CRS portal |
| 7 | Proof of Office Address | Documentary proof of the partnership's principal office address | Lease contract, land title, or authorization letter from property owner |
| 8 | PRC License (Professional Partnership) | Valid Professional Regulation Commission license of each partner | Required only for professional partnerships (CPAs, lawyers, doctors, etc.) |
| 9 | Foreign Partner Documents | Passport, ACR, visa, and proof of compliance with the Foreign Investments Act | Required only if the partnership has foreign partners; check FINL restrictions |
| 10 | Clearances (if applicable) | Special clearances or permits for regulated industries (e.g., banking, insurance, education) | Required for partnerships engaged in regulated activities under special laws |
Note: Requirements may vary depending on the type of partnership and the nature of the business activity. For partnerships engaged in regulated industries (banking, insurance, lending, education, etc.), additional clearances or endorsements from the relevant government agencies may be required. Always check the latest SEC Memorandum Circulars for updated requirements.
Comparison: General vs Limited vs Professional Partnership
The following table compares the three main types of partnerships recognized under Philippine law. Use this guide to help you decide which partnership structure is best for your business or professional practice.
| Feature | General Partnership | Limited Partnership | Professional Partnership |
|---|---|---|---|
| Liability | All partners have unlimited, joint and several liability for partnership debts | General partners: unlimited liability; Limited partners: liability limited to capital contribution | Partners are liable only for their own acts of malpractice; shared liability for partnership debts |
| Management | All partners have equal right to manage and participate in business decisions | Only general partners manage the business; limited partners cannot participate in management | All partners may participate in management as agreed upon in the Articles of Partnership |
| Capital Requirements | No minimum capital required by law (but must be ₱3,000+ to register with SEC) | No minimum capital required by law; limited partners must contribute capital (cash or property, not services) | No minimum capital required; partners may contribute industry (professional services) as capital |
| Transferability of Interest | A partner cannot transfer their interest without consent of all other partners | Limited partners may transfer their interest more freely, subject to the Articles of Partnership | Transfer requires consent of all partners; new partner must also be a licensed professional |
| Tax Treatment | Partnership is taxed as a corporation at 25% (or 20% for MSME) on net taxable income | Same as general partnership — taxed at the partnership level as a corporate entity | Exempt from income tax at the partnership level; each partner pays individual income tax on their share |
| Number of Partners | Minimum of 2 general partners; no maximum limit | At least 1 general partner and 1 limited partner; no maximum limit | Minimum of 2 licensed professionals; no maximum limit |
| Name Requirement | May use any distinguishable name; often includes partners' surnames | Must include "Limited" or "Ltd." in the partnership name | Usually includes the names of the partners and the profession (e.g., "Santos & Cruz Law Offices") |
| Dissolution | Dissolved upon death, withdrawal, or insolvency of any partner (unless otherwise agreed) | Not dissolved by death or withdrawal of a limited partner; dissolved if all general partners withdraw | Same rules as general partnership; may continue if agreed upon in the Articles of Partnership |
Complete Example
Three Friends Start a Restaurant Partnership
Background: Juan, Maria, and Pedro are three friends who decide to open a Filipino restaurant in Quezon City. They want to pool their resources and form a general partnership. Juan will invest ₱200,000 in cash, Maria will contribute ₱200,000 worth of kitchen equipment and furniture, and Pedro will invest ₱100,000 in cash and serve as the managing partner who runs the day-to-day operations. Their total capital contribution is ₱500,000.
Step 1: Choosing the Partnership Type
The three friends discuss their options and decide on a General Partnership since all three want to participate in major business decisions. Juan and Maria will handle finances and marketing respectively, while Pedro manages daily operations as the managing partner. They understand that as general partners, each of them will have unlimited personal liability for the partnership's debts.
Step 2: Reserving the Partnership Name
Pedro logs in to the SEC Company Registration System (CRS) at crs.sec.gov.ph and submits three proposed names: (1) "Kainan ni Juan, Maria & Pedro General Partnership," (2) "Tatlong Magkakaibigan Food Partnership," and (3) "JMP Filipino Restaurant Partnership." After 2 working days, the SEC approves their first choice. The name reservation is valid for 30 days, and they paid ₱100 for the reservation.
Step 3: Drafting the Articles of Partnership
They hire a lawyer to draft their Articles of Partnership. The document specifies: the partnership name, the purpose (food and beverage business), principal office in Quezon City, a term of 20 years, capital contributions of each partner (Juan: ₱200,000 cash; Maria: ₱200,000 in kind; Pedro: ₱100,000 cash), profit-sharing ratio of 40%-40%-20%, and Pedro as managing partner. All three sign the document before a notary public.
Step 4: Preparing Supporting Documents
They prepare the following: (1) Notarized Articles of Partnership, (2) Affidavit of Capital Contribution listing all contributions, (3) Bank Certificate of Deposit showing ₱300,000 cash deposited at BDO under the partnership's name, (4) Deed of Assignment for Maria's kitchen equipment valued at ₱200,000, (5) Valid IDs of all three partners (Philippine passports), (6) Lease contract for their restaurant space in Quezon City, and (7) SEC Cover Sheet.
Step 5: Submitting to SEC CRS
Pedro uploads all documents through the SEC CRS portal. He enters the partnership details including the approved name reservation number, the names and contributions of all three partners, and the business address. He uploads scanned PDF copies of all documents and submits the application. The system generates reference number SEC-PRTN-2025-0001234 for tracking.
Step 6: Paying the Registration Fees
The SEC issues an Order of Payment. The total fees are computed as follows: Registration Fee = 1/5 of 1% of ₱500,000 = ₱1,000 (but minimum is ₱2,000, so they pay ₱2,000). Legal Research Fee = 1% of ₱2,000 = ₱20. Total fees paid: ₱2,020 plus the ₱100 name reservation fee already paid. Pedro pays through the SEC online payment portal via GCash.
Step 7: Receiving the Certificate
After 5 working days, the SEC issues the Certificate of Registration for "Kainan ni Juan, Maria & Pedro General Partnership." The certificate is available for download through the SEC CRS portal. The partnership is now a registered juridical entity. Pedro then proceeds to register with the BIR, apply for a business permit in Quezon City, and register with SSS, PhilHealth, and Pag-IBIG for their future employees.
| Detail | Information |
|---|---|
| Partnership Name | Kainan ni Juan, Maria & Pedro General Partnership |
| Partnership Type | General Partnership |
| Total Capital | ₱500,000 |
| Juan's Contribution | ₱200,000 (cash) — 40% share |
| Maria's Contribution | ₱200,000 (kitchen equipment & furniture) — 40% share |
| Pedro's Contribution | ₱100,000 (cash) + managing partner duties — 20% share |
| Managing Partner | Pedro (handles day-to-day restaurant operations) |
| Registration Fee | ₱2,000 (minimum) + ₱20 (LRF) + ₱100 (name reservation) = ₱2,120 |
| Processing Time | 5 working days from complete submission |
| Principal Office | Quezon City, Metro Manila |
| Partnership Term | 20 years from the date of registration |
Frequently Asked Questions (FAQ)
Q: How is a partnership dissolved, and what are the steps for winding up?
A: A partnership may be dissolved by mutual agreement of all partners, expiration of the agreed term, completion of the specific purpose for which it was formed, death or insolvency of any partner, or by court decree. Upon dissolution, the partnership must wind up its affairs, which includes settling all debts, collecting receivables, liquidating remaining assets, and distributing the net proceeds to the partners according to their capital contributions and profit-sharing ratios. A Certificate of Dissolution must be filed with the SEC, along with a statement of liquidation and a BIR tax clearance certificate. The winding-up process must comply with Articles 1829 to 1841 of the Civil Code.
Q: Can a new partner be added to an existing partnership?
A: Yes, a new partner can be admitted to an existing partnership, but only with the consent of all existing partners. The admission of a new partner technically dissolves the old partnership and creates a new one, even if the business continues under the same name. The Articles of Partnership must be amended to reflect the new partner's name, contribution, and profit-sharing ratio. The amended Articles must be filed with the SEC along with the required filing fee. The new partner is liable for partnership obligations arising after their admission but is not personally liable for obligations incurred before their admission (though their capital contribution may be used to satisfy pre-existing debts).
Q: Can foreigners be partners in a Philippine partnership?
A: Yes, foreigners can be partners in a Philippine partnership, subject to the restrictions of the Foreign Investments Act (Republic Act No. 7042) and the Foreign Investment Negative List (FINL). Certain business activities are reserved exclusively for Filipino citizens or require a minimum percentage of Filipino ownership. For nationalized or partly nationalized activities, the partnership must maintain the required Filipino equity percentage (typically 60% Filipino and 40% foreign). Foreign partners must provide their passport, Alien Certificate of Registration (ACR), and visa documentation. It is advisable to verify the specific FINL restrictions for your intended business activity before forming the partnership.
Q: What are the tax implications of registering a partnership?
A: General and limited partnerships are treated as corporations for income tax purposes under the National Internal Revenue Code (NIRC). They are subject to the Regular Corporate Income Tax (RCIT) of 25% on net taxable income, or 20% for partnerships that qualify as Micro, Small, and Medium Enterprises (MSMEs) with net taxable income not exceeding ₱5 million and total assets (excluding land) not exceeding ₱100 million. Professional partnerships, however, are exempt from income tax at the partnership level — instead, each partner is individually responsible for reporting and paying income tax on their distributive share. All partnerships must also withhold taxes, file VAT or Percentage Tax returns, and comply with BIR reporting requirements.
Q: Can a partnership be converted into a corporation?
A: Yes, a partnership can be converted into a corporation, but it is not a direct conversion process. The partners must first dissolve the existing partnership (filing the appropriate dissolution documents with the SEC) and then incorporate a new corporation by filing Articles of Incorporation and By-Laws with the SEC. Alternatively, the partnership's assets and liabilities can be transferred to a newly formed corporation in exchange for shares. This process requires careful legal and tax planning, including obtaining a BIR tax clearance for the dissolved partnership and potentially paying transfer taxes on assets conveyed to the new corporation. Consult both a lawyer and an accountant to structure the conversion properly.
Q: What annual compliance requirements does a registered partnership have with the SEC?
A: All registered partnerships must file the following with the SEC on an annual basis: (1) the General Information Sheet (GIS), which must be filed within 30 days after the anniversary date of the partnership's registration, and (2) the Audited Financial Statements (AFS), which must be filed on or before April 15 of the following year (or within 120 days after the fiscal year-end for partnerships with fiscal year reporting). Both filings are done through the SEC eFAST portal at efast.sec.gov.ph. Failure to file these documents for five consecutive years may result in the revocation of the partnership's Certificate of Registration and the imposition of penalties.
Important Reminders
- Register before operating: A partnership with a capital of ₱3,000 or more must be registered with the SEC before it can legally commence business. Failure to register may result in the partnership being considered a de facto partnership without juridical personality.
- Notarize the Articles of Partnership: The Articles of Partnership must be signed by all partners and notarized by a commissioned notary public. An unnotarized document will not be accepted by the SEC for registration.
- Understand your liability: General partners have unlimited personal liability for partnership debts. Consider a limited partnership if some partners want to limit their exposure to their capital contribution only.
- Comply with the Foreign Investments Act: If you have foreign partners, verify that your business activity is not restricted or reserved for Filipino nationals under the Foreign Investment Negative List (FINL). Violation of nationality restrictions can result in the cancellation of registration.
- File GIS and AFS annually: All registered partnerships must file their General Information Sheet and Audited Financial Statements with the SEC every year. Non-compliance for five consecutive years may lead to revocation of registration.
- Update the SEC on any changes: Any change in partnership name, address, partners, capital, or business purpose must be reported to the SEC by filing amended Articles of Partnership with the corresponding fees.
- Register with BIR, LGU, and other agencies: SEC registration is just the first step. After receiving your Certificate of Registration, register with the BIR for tax purposes, apply for a business permit with your LGU, and register with SSS, PhilHealth, and Pag-IBIG if you will have employees.
- Keep proper books and records: Partnerships are required to maintain proper accounting books and records of all transactions. These records are essential for preparing the annual AFS and for resolving any disputes among partners regarding profits and losses.
- Plan for dissolution: Include clear dissolution and exit provisions in your Articles of Partnership to avoid disputes if a partner wants to leave, dies, or becomes incapacitated. A well-drafted agreement can prevent costly legal battles.
- Consult professionals: Engage a lawyer to draft or review the Articles of Partnership and an accountant to handle tax registration and compliance. The cost of professional advice upfront is far less than the cost of resolving legal and tax issues later.
Need Help?
If you have questions about registering a partnership with the SEC or need assistance with your application, you can reach the Securities and Exchange Commission through the following channels:
SEC Hotline
Phone: (02) 8818-0921
Available Monday to Friday, 8:00 AM to 5:00 PM
Visit SEC Main Office
SEC Building, EDSA Greenhills, Mandaluyong City
Walk-in inquiries accepted during office hours
SEC Online Portal: For partnership registration, name reservation, and document submission, use the SEC Company Registration System (CRS) at crs.sec.gov.ph. For annual compliance filings (GIS and AFS), use the SEC eFAST portal at efast.sec.gov.ph. Both portals require separate user accounts.
Disclaimer
This guide is provided for general informational purposes only. The requirements, steps, fees, and procedures mentioned here may vary depending on the SEC office you visit. We recommend visiting your nearest SEC office first to confirm the specific requirements and process before preparing your documents.