“LEGAL UPDATES”

17TH ARCH/DIOCESAN FINANCIAL ADMINISTRATORS OF THE PHILIPPINES NATIONAL CONVENTION

June 18, 2015Hotel EssenciaDumaguete City

“ Can. 22 Civil laws to which the law of the Church yields are to be observed in canon law with the same effects, insofar as they are not contrary to divine law and unless canon law provides otherwise.”

“Can. 1286 Administrators of goods:1/ in the employment of workers are to observe

meticulously also the civil laws concerning labor and social policy, according to the principles handed on by the Church;

“Can. 1290 The general and particular provisions which the civil law in a territory has established for contracts and their disposition are to be observed with the same effects in canon law insofar as the matters are subject to the power of governance of the Church unless the provisions are contrary to divine law or canon law provides otherwise, and without prejudice to the prescript of ⇒ can. 1547.

“ Can. 391 §1. It is for the diocesan bishop to govern the particular church entrusted to him with legislative, executive, and judicial power according to the norm of law.§2. The bishop exercises legislative power himself. He exercises executive power either personally or through vicars general or episcopal vicars according to the norm of law. He exercises judicial power either personally or through the judicial vicar and judges according to the norm of law.”

I. CORPORATION SOLE ≠ RELIGIOUS SOCIETY - SEC. 110, 116, CORPORATION CODE

II. RIGHTS OF A JURIDICAL PERSONA. TO ACQUIRE PROPERTIESB. TO ENTER INTO CONTRACTSC. TO SUE AND BE SUED

C E R T I F I C A T I O N

“This is to certify that the Roman Catholic Archbishop of Manila (RCAM) is a corporation sole organized and existing in accordance with the laws of the Republic of the Philippines. Attached is a copy of its Articles of Incorporation marked as Annex ‘A’.

“As a corporation sole, it is composed of a single individual who may be a bishop, priest, minister or presiding elder of a religious sect, denomination or church. Its purpose is to administer and manage as trustee the property and affairs of such religious sect, denomination or church, within the territorial jurisdiction of such office (Section 110 and 111, Corporation Code).

“ The bishop, priest, minister or presiding elder is the only person recognized by law as the administrator of the corporation sole and the court may take judicial notice of such fact (Santos v.s Bishop of Nueva Caceres, 45 Phil. 895). The successor in office of the bishop, priest or elder concerned shall become the corporation sole on his accession to office, by filing with the SEC a copy of his letter of appointment duly certified by a notary public (Section 114, ibid.).

“Given the above circumstances, the RCAM is a special corporation that does not have a Board of Trustee and a set of officers. As such, it cannot issue a Secretary’s Certificate. However, the Archbishop of Manila, as the sole administrator, can issue any certification requested concerning any of his specific transaction in relation to the administration of RCAM’s property.

Please be guided accordingly.

III. REQUISITES FOR INCORPORATION OF A CORPORATION SOLE

(a.) RELIGIOUS DENOMINATION, SECT OR CHURCH TO BE ADMINISTERED IS ALREADY

EXISTING.

(b.) ARTICLES OF INCORPORATION – BY-LAWS NOT REQUIRED.

(c) AUTHENTICATED COPY OF THE APPOINTMENT WITH OFFICIAL TRANSLATION – NUNCIA-

TURE’S OFFICE

IV. REPORTORIAL REQUIREMENTS-FINANCIAL STATEMENT OR AFFIDAVIT OF THE

BISHOP

SEC EN BANC CASE O3-13-1899- THE COMMISSION IN ITS EN BANCE RULING OF APRIL 1, 2004, THE COMMISSION DOES NOT REQUIRE A CORPO-RATION SOLE TO SUBMIT REPORTS. TO BE EXEMPT, IT SHOULD SUBMIT REGULARLY PROOF THAT IT HAS NO OTHER PROPERTIES OTHER THAN CHURCH PREMISES X X X.

v. UPDATE ON THE STATUS OF THE SEC REGISTRATION OF EVERY ARCH/DIOCESE

a.) DATA BASE OF SECb.) REPORTORIAL REQUIREMENTS

AFFIDAVIT

I, (NAME OF ARCH/BISHOP), FILIPINO, OF LEGAL AGE, WITH OFFICIAL ADDRESS AT (ADDRESS OF CORPORATION SOLE), AFTER HAVING BEEN DULY SWORN IN ACCORDANCE WITH LAW, HEREBY DEPOSE AND STATE THAT:

1. I AM THE SOLE ADMINISTRATOR OF (NAME OF

ARCH/DIOCESE) WITH OFFICIAL ADRESS AT ____________.

2. AS SOLE ADMINISTRATOR, I ADMINISTER THE TEMPORALITIES AND PROPERTIES OF (NAME OF ARCH/DIOCESE).

3. THE PROPERTIES OF THE ARCH/DIOCESE INCLUDE:

A.) IMMOVABLE/REAL PROPERTIES WHICH ARE EXCLUSIVELY BEING USED AND DEVOTED FOR RELIGIOUS PURPOSE;

B.) BANK DEPOSITS/ SHARES OF STOCKS.

4. THE ARCH/DIOCESE IS NOT DOING BUSINESS OR IS NOT ENGAGED IN ANY INCOME-GENERATING ACTIVITY.

5. AS A CORPORATION SOLE, IT IS EXEMPTED FROM THE FILING OF THE ANNUAL REPORTORIAL REQUIREMENTS.

PLACE, DATE.

PROCEDURE FOR THE TRANSFER OF TITLES OF REAL PROPERTIES FROM ONE DIOCESE TO A NEWLY CREATED DIOCESE:

STEP 1 – ADVICE FROM LRA

STEP 2- REQUEST FOR TAX EXEMPTION

March 08, 2007- letter of the Bureau of Internal Revenue: “this Office is of the opinion as it hereby holds that no capital gains tax, expanded withholding tax or documentary stamp tax is due on the transfer of real or personal properties currently registered in the name of RCAM to the newly-created dioceses of Pasig, Novaliches, Kalookan, Cubao and Parañaque for purposes of administration and in compliance with the mandate of the Papal Bulls creating such dioceses.”

STEP 3 – PREPARATION OF THE DEED OF TRUST

DEED OF TRUST

KNOW ALL MEN BY THESE PRESENTS:

This DEED made and executed in the City of Manila, by and between-

THE ROMAN CATHOLIC ARCHBISHOP OF MANILA, a corporation sole, duly organized and existing in accordance with Philippine Laws, with office address at 121 Arzobispo St., Intramuros, Manila, represented herein by HIS EMINENCE, GAUDENCIO B. CARDINAL ROSALES, D.D., Archbishop of Manila as its sole administrator and hereinafter referred to as the “TRUSTOR,”

- and –

THE ROMAN CATHOLIC BISHOP OF CUBAO, INC., a corporation sole, duly organized and existing in accordance with Philippine Laws, with address at No. 14, Lantana St. Cubao, Quezon City represented herein by MOST REV. HONESTO ONGTIOCO, D.D., Bishop of Cubao as its sole administrator and hereinafter referred to as “TRUSTEE,”

WITNESSETH: That -

The TRUSTOR, for and in obedience with the Papal Bull issued by the Holy Vatican on June 28, 2003 (certified copy of which is attached as Annex “A”, the English translation as Annex “A-1”) does hereby GRANT, CONVEY and ASSIGN, by way of trust, unto the TRUSTEE the following real properties, of which the TRUSTOR is the registered owner in fee simple in accordance with the provisions of the Land Registration Act, as amended. These properties are more particularly described as follows:

“That the TRUSTEE shall have and hold the said properties in trust for the sole and exclusive use, benefit, and enjoyment of the UNIVERSAL CATHOLIC CHURCH in accordance with Canon 1257-§1;

“That the TRUSTEE shall have the power to administer, lease, mortgage, or otherwise dispose any of the above-described property, if and when in its judgment it will redound to the best interests of the Universal Catholic Church (Canon 1254, §1 and Canon 1255, Code of Canon Law of 1983);

“That the TRUSTOR agrees that titles of the above-mentioned properties be transferred into the name of the TRUSTEE so that the latter can be able to fully administer the same in accordance with the Code of Canon Law of 1983.

“That the trust herein created shall automatically cease and terminate after due notice given by the Holy See through its Papal Bull.

“That the TRUSTEE hereby covenants and agrees with the TRUSTOR to faithfully perform its duties and fulfill the trust herein created and accepted through its sole administrator under the precise terms and conditions thereof.

IN WITNESS WHEREOF, the parties have hereunto set their hands this ____ day of ____________, 2011.

OTHER DOCUMENTS NEEDEDa.) Certified True Copies of the Titles of all

properties included;

b.) Certified True Copies of the Tax Declaration – land and building

Note: There are two or more tax declarations for each title depending on the number of improvements declared therein.

The area appearing in the tax declaration should correspond to the area of the land appearing in the title.

If the land has no improvement or it is a vacant lot, a certificate of no improvement is needed.

c.) Certificate Authorizing Registration or the CAR – issued by the Bureau of Internal Revenue (BIR) upon proper submission of the Deed of Trust, the Certified Copies of the Tax Declaration and the Zonal Valuation of the properties for transfer.

d.) Tax Clearance

STEP 4 – FILING OF DOCUMENTSBIR - Revenue District Office (RDO) of the Trustor1. Submit the following documents to the ONETTE (One-Time Transactions) Section:

– Notarized Deed of Trust with Annexes– Certified Copies of Transfer Certificate of

Titles– Certified Copies of Tax Declaration– Certificate of “no improvement” if there’s any

– BIR Ruling – TAX EXEMPTION– REPLY OF LRA as to the mode of transfer

by virtue of a Deed of Trust– Summary List of properties to be

transferred with their corresponding zonal and market values

– Certified copies of zonal values of the properties appearing on the list

2. Fill up ONETTE Computation Sheet on Expanded Withholding Tax (EWT) and Documentary Stamp Tax (DST)

3. Fill up BIR Form 1904 (Application for Registration) for the purpose of verifying the TIN (Tax Identification Number) of the dioceses who are parties to the contract

4. Fill up BIR Form 1606 (Withholding Tax Remittance Return)

5. Fill up BIR Form 2000-OT (Documentary Stamp Tax Declaration/Return)6. Pay the necessary fees (verification/certification fees only)The documents will be reviewed by the BIR Examiner and if all the requirements are complied with, entries will be encoded in the Certificate Authorizing Registration (CAR) and Tax Clearance Certificate which will soon to be released by the BIR in order that properties be transferred in favor of the newly created diocese.

B. REGISTER OF DEEDSSubmit the documents to the Registry of Deeds

where the properties are situated– Deed of Trust duly entered and certified by the

BIR– Certificate Authorizing Registration– Tax Clearance Certificate– Exemption from the Treasurer’s Office or

Assessor’s Office for local taxes

Pay the necessary Entry FeesPay the necessary Registration Fees

NOTE: The Register of Deeds will examine all the documents for transfer and will make the necessary entry in the registration book. Entries in the respective titles will be encoded in the new Transfer Certificate of Titles in the name of the newly created diocese.

STEP 5 – ISSUANCE OF NEW CERTIFICATE OF TITLES – COMPUTERIZED, NAME OF ORIGINAL OWNER DOES NOT ANYMORE APPEAR.

STEP 6 – ISSUANCE OF TAX DECLARATION – present the certified copies of the titles to the assessor’s office. The assessor’s office will now issue a new tax declaration in the name of the newly created diocese.Note: The properties to be transferred should be cleared from any lien or encumbrances annotated at the back of the title to effectuate transfer in favor of the newly created dioceses.

SALAMAT PO!

ATTY. LIZA