Law Summary

Purpose of the Memorandum

This Memorandum Circular outlines the requirements for non-stock, non-profit corporations, including NGOs, that intend to engage in microfinance activities in the Philippines.

• Legal Basis: Operate under the framework of Republic Act No. 8425, the Social Reform and Poverty Alleviation Act.
• Target Entities: Non-stock, non-profit corporations and NGOs focusing on uplifting disadvantaged sectors through various supportive activities.

Requirements for Articles of Incorporation

Non-stock, non-profit corporations must explicitly state their intent to conduct microfinance operations.

• Inclusion in Articles: The purpose clause in the Articles of Incorporation must reflect the engagement in microfinance activities as per RA 8425.
• General Information Sheet (GIS): Microfinance operations must also be included in the purposes box of the GIS.

Definition of NGOs

The Memorandum provides a definition of NGOs relevant to microfinance activities.

• Definition: Duly registered non-stock, non-profit organizations that focus on the upliftment of basic or disadvantaged sectors.
• Activities: May include advocacy, training, community organizing, research, and resource access.

Filing Requirements

Existing non-stock, non-profit corporations engaged in microfinance operations must amend their documentation to demonstrate compliance.

• Documents to File: Amended Articles of Incorporation (AAI) and GIS must be submitted.
• Deadline for Filing: Within thirty (30) days from the effective date of the Memorandum Circular.

Penalties for Non-Compliance

Failure to comply with the filing requirements may lead to legal consequences.

• Liability: Parties concerned may face penalties as provided by law for non-filing or delayed filing.

Effectivity

The Memorandum Circular will take effect after a specified period post-publication.

• Publication Requirement: The Memorandum shall take effect fifteen (15) days after publication in a newspaper of general circulation.

Key Takeaways

• Non-stock, non-profit corporations, including NGOs, must state their microfinance activities in the Articles of Incorporation and GIS as per RA 8425.
• Existing entities have thirty (30) days to file amended documents with the Commission to avoid penalties.
• The Memorandum takes effect fifteen (15) days after publication, emphasizing the importance of timely compliance.