Question & AnswerQ&A (Republic Act No. 7798)
Republic Act No. 7798, enacted on August 25, 1994, amended Section 25 of Batas Pambansa Blg. 232.
The main subject is the establishment of schools, particularly the requirements for establishing new national schools and the incorporation requirements for private schools.
Private schools must incorporate as either a non-stock or a stock educational corporation in accordance with the Corporation Code of the Philippines, except for family-administered pre-school institutions which may be exempted.
The minimum paid-up capital is as follows: P1,000,000 for elementary education; P2,500,000 for institutions offering both elementary and secondary education; and P5,000,000 for those offering elementary, secondary, tertiary, and postgraduate courses.
Yes, existing educational institutions organized as stock corporations may retain their original capitalization and may automatically apply for renewal of their corporate existence when the original period expires.
Stock educational institutions are allowed only in capital-intensive courses of study as determined by the Department of Education, Culture and Sports, the Commission on Higher Education, and the Department of Science and Technology.
No, schools established as stock corporations are ineligible for any form of government subsidy or assistance, except for scholarships, student loans, or other subsidies given to individual students and teachers under existing laws.
Donations to educational corporations are exempt from taxes.
The Department of Education, Culture and Sports and the Commission on Higher Education are authorized to formulate implementing rules and guidelines within 60 days from the approval of the Act.
The Act took effect fifteen (15) days after its publication in at least two (2) national newspapers of general circulation.