BIR Ruling

December 18, 1975 Messrs. Sicangco & Pamintuan Certified Public Accountants S-622 Rufino Bldg. Ayala Ave., Makati, Rizal Attention: Mr . A . N . Sicangco Partner Gentlemen : This refers to your letter dated September 17, 1975 stating that your client, Construction Associates, Inc., a domestic corporation and Ryukyu Land Development & Construction Company, LTD., a corporation organized under the laws of Japan, duly licensed to do business in the Philippines, entered into a joint venture agreement for the specific purpose of dredging and reclamation work per contract with the Bureau of Public Works, and named their joint operations: "Construction Associates, Inc. and Ryukyu Land Development and Construction Company, Ltd." aisa dc With the foregoing as a premise, you would like to be informed whether in the registration of the business name and style, this Bureau requires the prior registration of the above joint venture with the Bureau of Commerce, considering that the Bureau of Commerce requires registration with the Securities and Exchange Commission, while the latter does not accept venture agreement for registration. In reply, I have the honor to inform you that Section 203 of the Tax Code provides that "every person engaged in business on which a privilege tax is imposed by law shall, on or before the commencement of his business register with the Revenue District Officer or collection agent, within ten days after securing his privilege tax receipt, his name or style." Under this provision, prior registration of the applicant with the Bureau of Commerce or with the Securities and Exchange Commission is not required as a condition precedent to the registration of his business name and style with this Office. A joint venture is a partnership within the meaning of Section 84(b) of the Tax Code and taxable as a corporation under Section 24 thereof, even if such partnership has no juridical personality independent of its members (Collector of Internal Revenue vs. Batangas Trans. Co. & Laguna Tayabas Bus Co., G. R. No. L-9692, Jan 6, 1958). Inasmuch as the joint venture is engaged in an activity subject to the contractor's fixed and percentage taxes, it is required to secure a privilege tax and register its business name and style with the Revenue District Officer within ten days after securing its privilege tax receipt. Very truly yours, (SGD.) EFREN I. PLANA Acting Commissioner of Internal Revenue TAN 1456-040-3