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Articles of Organization
"I need Articles of Organization for a corporation with a board of 3 directors, specifying quarterly meetings, a 65% majority for major decisions, and a fiscal year starting January 1st."
What is an Articles of Organization?
Articles of Organization form the legal backbone of your Limited Liability Company (LLC) in the Philippines. This foundational document, filed with the Securities and Exchange Commission (SEC), officially brings your LLC into existence and establishes its basic structure.
Think of it as your company's birth certificate - it spells out essential details like your business name, principal office address, company purpose, and initial members. Under the Revised Corporation Code, these Articles must be properly filed and approved before your LLC can legally operate, enter contracts, or conduct business transactions in the country.
When should you use an Articles of Organization?
You need Articles of Organization when starting a new LLC in the Philippines. This crucial document must be filed with the SEC before your company can legally begin operations, open bank accounts, or enter into contracts. The timing is essential - file these Articles right at the beginning of your business formation process.
Many entrepreneurs prepare their Articles of Organization when transitioning from sole proprietorship to LLC status, seeking investment funding, or expanding operations. Having properly filed Articles protects your personal assets and establishes your company's legitimacy with potential business partners, banks, and government agencies.
What are the different types of Articles of Organization?
- Non Profit Organization Articles Of Incorporation: Designed for charitable and non-profit entities, focusing on social mission and non-distribution of profits
- Articles Of Incorporation Stock Corporation: Structured for companies issuing shares, with detailed capitalization and stockholder provisions
- Partnership Articles Of Incorporation: Tailored for business partnerships, outlining partner roles and profit-sharing arrangements
- Partnership Articles Of Organization: Specific to LLC partnerships, combining limited liability protection with partnership flexibility
- Articles Of Organization S Corp: Adapted for small corporations seeking pass-through taxation benefits
Who should typically use an Articles of Organization?
- Business Founders: Primary creators and signatories of the Articles of Organization, responsible for defining the LLC's structure and initial management
- Corporate Lawyers: Draft and review the Articles to ensure compliance with Philippine corporation laws and SEC regulations
- LLC Members: Bound by the provisions outlined in the Articles, including their rights, responsibilities, and ownership stakes
- SEC Officials: Review and approve the Articles before granting the LLC its legal existence
- Company Officers: Execute the business according to the powers and limitations set forth in the Articles
- Stakeholders: Include investors, creditors, and business partners who rely on the Articles to verify the LLC's legitimacy
How do you write an Articles of Organization?
- Company Details: Prepare your LLC name, principal office address, and business purpose statement
- Member Information: Gather full names, addresses, and ownership percentages of all LLC members
- Capital Structure: Determine initial capital contribution amounts and payment schedule
- Management Setup: Decide between member-managed or manager-managed structure
- SEC Requirements: Verify current SEC naming guidelines and minimum capitalization rules
- Supporting Documents: Collect tax identification numbers, valid IDs, and proof of address
- Digital Platform: Use our system to generate a legally-compliant template that includes all mandatory elements
- Final Review: Double-check all entries for accuracy before SEC submission
What should be included in an Articles of Organization?
- Company Name: Full legal name with LLC designation, verified against SEC restrictions
- Business Purpose: Clear statement of primary business activities and scope of operations
- Principal Office: Complete registered business address in the Philippines
- Term Duration: Specified period of existence, typically perpetual unless stated otherwise
- Capital Structure: Total capitalization and member contributions details
- Management Structure: Clear designation of member-managed or manager-managed format
- Member Information: Names, addresses, and ownership percentages of all initial members
- Dissolution Terms: Conditions and procedures for company dissolution
- Signature Block: Spaces for all required member signatures and dates
What's the difference between an Articles of Organization and an Articles of Incorporation?
Articles of Organization and Articles of Incorporation are often confused in the Philippines, but they serve different business structures. Here are the key distinctions:
- Business Structure: Articles of Organization are specifically for Limited Liability Companies (LLCs), while Articles of Incorporation create corporations
- Management Flexibility: LLCs offer more flexible management options and fewer formal requirements compared to corporations' strict board structure
- Tax Treatment: LLCs can choose their tax treatment, while corporations face mandatory double taxation unless they qualify for special status
- Ownership Transfer: LLC ownership transfers typically require member approval, while corporation shares can be freely traded (subject to restrictions)
- Compliance Requirements: Corporations face more rigorous reporting and compliance obligations under SEC rules than LLCs
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