Question & AnswerQ&A (LTO MEMORANDUM CIRCULAR NO. 575-2005)
HIGC refers to the Home Insurance and Guaranty Corporation, formerly known as the Home Financing Commission and Home Financing Corporation, a government-owned and controlled corporation created under R.A. 580 and Executive Orders No. 535 and 90 that regulates the registration and supervision of homeowners associations.
Members of an HOA can be present or future homeowners, awardees, occupants of private or government housing projects, subdivisions, or urban estates, as well as beneficiaries of the Community Mortgage Program or members meeting the qualifications in the association's articles or bylaws.
The required documents include the Articles of Incorporation, By-Laws signed by all incorporators, a written undertaking to change corporate name if necessary and comply with HIGC rules, information sheet, and certification of the association's existence within the subdivision or community.
The incorporation papers must be submitted at the principal office of HIGC or at an office designated by HIGC.
Upon registration, the homeowners association becomes a body corporate with a personality separate and distinct from that of its individual members.
They must submit an annual report with financial statements, association books (membership, cash, minutes, ledger, journal), information sheet as of the annual meeting, minutes of annual meetings of members and board, notice of postponement or affidavit of non-holding of annual meeting, board resolution of non-operation, and any other reports required by HIGC.
The HIGC has the power to assess and collect penalties for late filing of any required reports and other reportorial requirements.
Suspension or revocation may occur due to fraud or misrepresentation in obtaining the certificate, serious misrepresentation of association activities, refusal to comply with HIGC orders, misuse of corporate rights or privileges, commission of offenses under the rules or Corporation Code, continuous inactivity for five years, or failure to file required reports.
Dissolution may occur by shortening of corporate term, voluntary dissolution with member and board resolution and publication, or involuntary dissolution upon verified complaint filed by the Office of the Solicitor General and decision by HIGC.
HIGC can impose fines and penalties, refuse or deny registration applications if contrary to law or policy, suspend or revoke certificates of registration, enlist government enforcement agencies, and exercise other necessary powers to supervise and regulate HOAs.