Atty. Antonio H. Abad

July 25, 1994 Atty. Antonio H. Abad Antonio H. Abad & Associates Law Offices Grd. Flr. Sarmiento Condominium 177 Yakal St.,Makati, Metro Manila S i r : This refers to your letter of July 12, 1994 requesting opinion on the queries posed therein relative to the effects of the proposed merger of Phil. Obstetrical Gynecological Society, Inc, (POGS) with Obstetrical and Gynecological Foundation of the Phil..Inc. (OGFP). As stated, POGS is a non-stock, non-profit corporation registered with the SEC since 1966 for the purpose of promoting science and art, as well as the practice of obstetrics and gynecology in the Philippines, among others. It is presently studying the possibility of merger with OGFP which is likewise a non-stock, non-profit corporation duly organized and registered with the SEC since 1982 with similar purposes as POGS. Almost all members of POGS are likewise members of OGFP, and the present Board of Directors of POGS is likewise the members of the Board of OGFP. While the feasibility of merger is indeed high and has already been approved in principle by the members during the last annual membership meeting, the following matters still need clarifications: 1. Whether a change of name of the surviving corporation may be validly done simultaneously with the said merger. 2. Whether there is a legal impediment to the proposed new name of the surviving corporation: Philippine Obstetrical and Gynecological Society (Foundation),Inc. In other words, may a corporation avail of both "society" and "foundation" in the same corporate name. 3. Whether the tax benefits under RA 2067, otherwise known as the National Science and Technology Act which were granted to OGFP, the absorbed corporation, shall likewise be extended and enjoyed by the surviving corporation. Relative to your third query, while under Section 80 (4) of the Corporation Code, the merger would have the effect of transferring all the rights privileges, immunities and franchises of the absorbed corporation to the surviving corporation, tax incentives are subject to existing tax laws, rules and regulations or policies implemented by the Bureau of Internal Revenue. Hence this issue should be addressed to that Agency. Regarding the statement in your letter that subject corporation are also engaged in the practice of profession, please be advised that the Commission does not allow corporations to engage in the said line of business activity. Personal qualifications for the practice of profession cannot be possessed by a corporation and in view of the distinct and separate personality of the corporation from the individual members/stockholders, it could not have the power to do an act requiring a license which only the individual members/stockholders, could obtain. The Commission, however, allows the business of "practice of profession" in the case of partnerships, in which case, it is the individual professional, not the partnership firm, who engages in the practice of profession and is responsible for his own acts as such. Very truly yours, (SGD.) FE ELOISA C. GLORIA Associate Commissioner