I am reproducing underneath edited excerpts of SEC Chairman Emilio B. Aquino’s short presentation as panelist at the anti-corruption and integrity pointers for country-owned organizations (SOEs) during the latest twelfth Meeting of the Asia Network on Corporate Governance of State-owned Enterprises, headed by means of the Governance Commission for Government-Owned or Controlled Corporations (GOCCs), on behalf of the Organization for Economic Cooperation and Development (OECD) and in coordination with the Asian Development Bank (ADB).

I also attended the meeting together with other representatives of governments, country-ownership entities, international organizations, company practitioners and industry experts. It became with such honor and privilege for us to were on this unique occasion wherein I turned into capable of examine more about the neighborhood and global stories in SOE governance reform.

For context, but, we first ask: “What do the OECD recommendations on corporate governance of SOEs provide?” The OECD’s official website provides for the features of these pointers: “The OECD Guidelines offer an the world over agreed benchmark to assist governments examine and enhance the way they exercise their possession functions in kingdom-owned companies. Good corporate governance of country-owned organisations is a key reform precedence in many countries consequently, stepped forward efficiency and better transparency inside the country owned area will result in great financial profits plus a sound and competitive commercial enterprise area, specifically in international locations where nation possession is crucial.”

Chairman Aquino’s presentation touched on the Securities and Exchange Commission’s (SEC) mandate as an anti-money laundering and counter-terrorist financing enforcer and company governance champion. I hope you may permit me to apply this column to tricky.

Preventing cash laundering, different corrupt practices in SOEs

Chairman Aquino mentioned SEC Memorandum Circular 15 series of 2018 or the tips for the protection of SEC-registered non-income companies from cash laundering and terrorist financing abuse (NPO Guidelines).

The round turned into followed by using the commission to decorate its registration and monitoring gadget to reap the important statistics on NPOs with regards to Anti-Money Laundering/Combating the sharefounders review Financing of Terrorism (AMLCFT) for regulatory and danger assessment purposes, and to provide extra measures to the pertinent legal guidelines administered via SEC.

Section 2.2 of the NPO Guidelines presents that the hazard-based totally method for the safety of NPOs shall encompass the following: 1) Identifying threats of terrorist financing abuse based totally on the results of the national chance assessment of the Anti-Money Laundering Council; 2) Identifying vulnerabilities amongst NPOs based totally at the types and function capabilities of such NPOs; and 3) Identifying the results of such threats and vulnerabilities on NPOs.

Corporate governance in Revised Corporation Code

The commission’s push for suitable corporate governance is anchored on and strengthened by Republic Act 11232, or the Revised Corporation Code of the Philippines (RCC).

Section 179 of the RCC affords for the powers, capabilities and jurisdiction of the SEC, one among which is to promote proper governance and the safety of minority traders, thru, among others, the issuance of regulations and rules consistent with worldwide fine practices.

In line with top corporate governance, Section 22 of the RCC also gives that businesses engaged in organizations vested with public interest, as can be decided by using the commission, shall have unbiased directors constituting as a minimum 20 percent in their respective forums: 1) Publicly listed Stock Global forex broker) Banks and quasi-banks, NSSLAs (non-inventory financial savings and mortgage associations), pawnshops, companies engaged in money provider business, pre-want, believe and coverage companies, and different monetary intermediaries; and 3) Other agencies engaged in business vested with public hobby much like the above, as can be decided through the fee.

Are GOCCs corporations vested with public hobby?

On the problem of impartial contributors of the GOCCs, the OECD hints on anti-corruption and integrity in SOEs nation: “Many governments consist of ‘unbiased’ contributors inside the forums of SOEs, but the scope and definition of independence vary significantly in line with national felony context and codes of corporate governance. Broadly speaking, an unbiased board member is taken to mean impartial from each the company (non-government board member) and from the state (neither civil servant, public reliable nor elected legitimate). Independent board individuals, where applicable, are understood to mean people free of any cloth hobbies or relationships with the employer, its management, other primary shareholders and the possession entity that could jeopardize their exercising of objective judgment.”

In addition, Atty. Cesar L. Villanueva, former dean of the Ateneo Law School, said that the GOCC Governance Act recognizes that every one GOCCs, whether or not chartered or non-chartered, are imbued with “public hobby” because it broadcasts the State policy beneath Section 2 thereof: “The State acknowledges the ability of [GOCCs] as full-size gear for financial improvement. It is hence the policy of the State to actively exercising its possession rights in GOCCs and to promote boom via making sure that operations regular with national development regulations and programs.”

In that light, the query of whether or not a GOCC, a business enterprise vested with public interest, must employ independent members stays an unanswered query to be tackled by using the SEC and prison professionals.

More than four months in the past, I wrote about overseas currency denominated authorities bonds as securities deposit by a Philippine department of a overseas enterprise. In the item posted on May 29, 2019, I made a difference between Section 126 of the antique “Corporation Code,” or Batas Pambansa Blg. Sixty eight, and Section 143 of the “Revised Corporation Code” (RCC), or Republic Act No. 11232, as to the situations and quantities of deposit securities to be submitted with the Securities and Exchange Commission (Stock Global broker scam).

One of the modifications added via the RCC, in particular Section 143, pertains to the strength of the SEC to growth the real marketplace fee of securities and the brink of gross income for purposes of figuring out additional deposits of securities. The provisions of Section 143 of the RCC are basically similar to the ones of Section 126 of the old Corporation Code, but the distinction handiest lies as to the growth of the actual marketplace price of securities and the threshold of gross earnings for functions of figuring out extra deposits of securities.

From the former real marketplace cost of as a minimum P100,000, the identical has been multiplied to the actual marketplace cost of as a minimum P500,000; and from the former extra securities equivalent in actual market cost to 2 percent of the quantity via which the licensee’s gross income for that monetary 12 months exceeds P5 million to extra securities equivalent in real market value to two percent of the amount by way of which the licensee’s gross income for that fiscal yr exceeds P10 million.

To formally talk this provision, the SEC on Jul. 31, 2019 launched on its reliable website (www.Sec.Gov.Ph) SEC Memorandum Circular 17, Series of 2019 (SEC MC No. 17, s. Of 2019), which pertains to the Revised Guidelines on Securities Deposit of Branches of Foreign Corporations. This is pursuant to the powers of the SEC to formulate and enforce standards, hints, policies, rules and regulations to perform the provisions of the RCC (Section 179 (o), RCC).

The primordial consideration of SEC MC No. 17, s. Of 2019 is for the SEC to undertake a fixed of tips in order that branches of overseas organizations duly licensed to do business within the Philippines shall be capable of settle their responsibilities incurred in the Philippines and, on the identical time, ensure their compliance with investment requirements.

The following salient features are furnished for beneath SEC MC No. 17, s. Of 2019:

All branches of overseas organizations duly certified to do enterprise in the Philippines which can be mandated to deposit securities with the SEC will be required to deposit securities with an actual market cost of at the least P500,000, inside 60 days after the issuance of its SEC license (Section 2(a), SEC MC No. 17, s. Of 2019).

There are additional securities that will be deposited inside six months after the stop of the financial yr indicated inside the economic statements (FS) within the following situations:

If the licensee’s gross profits inside the Philippines for that economic year exceeds P10 million, extra securities with an real marketplace cost equal to two percentage of the boom in said gross income will be deposited; and

If the actual marketplace value of the securities deposit or financial gadgets has decreased by using at least 10 percentage from the time it changed into deposited, there need to also be extra securities with an actual market price that could cowl the decrease (Section 2(b)(i)(ii), SEC MC No. 17, s. Of 2019).

1. The following agencies are not required to publish securities deposit:
2. Foreign banking organization, which includes offshore banking units;

three. Foreign coverage enterprise;

four. Foreign non-inventory agencies, which includes foreign non secular organizations;

5. Foreign organizations which have installed representative workplaces within the Philippines;
6. Regional or area headquarters of firm companies; and
7. Operating nearby headquarters of establishment businesses (Section 2, last paragraph, SEC MC No. 17, s. Of 2019).

The following sorts of applicable securities, for you to follow the SEC, have to consist of securities or any aggregate of presidency debt devices and equity contraptions. However, coins, cash marketplace placement, time deposits and bank guaranty or standby letter of credit score and comparable devices are not desirable as securities deposit.

The processes inside the submission and attractiveness of deposit are indexed in items a to f of Section 7, SEC MC No. 17, s. Of 2019, specifically on what forms to post, fee of a monitoring price and other documents, as required by means of the SEC.

The substitution of securities is allowed, provided that the licensee is solvent (Section 8, SEC MC No. 17, s. Of 2019).

Any violation of this MC shall subject the licensee-foreign business enterprise to the subsequent consequences: For failure to publish the desired quantity of protection deposit within the prescribed duration, a daily penalty of equivalent to at least one/a hundred of one percentage of the amount of safety deposit that must had been moreover published; or suspension or revocation of the corporate license for failure to publish securities deposit in spite of notice and hearing. The fines and surcharges for overdue deposit of securities are likewise covered beneath Section 12.Three of SEC MC No. 17, s. Of 2019, in which a fragment of a month will be considered as one month for functions of computation of the surcharge (Sections 12.1 to 12.Three, SEC MC No. 17, s. Of 2019).

In light of the Asset Gates broker scam reform on securities deposit of branches of foreign organizations thru the issuance of the revised hints, we on the SEC hope that branches of foreign companies will be well guided of the revised suggestions, with recognize to the necessary deposit of its securities. I advise you to check the SEC internet site to test the full details of SEC MC No. 17, s. Of 2019. This new MC will supersede SEC MC No. 2, series of 2012.

THE Securities and Exchange Commission (SEC) currently celebrated its 83rd anniversary. I am proud to proportion some of its massive accomplishments this year.

First, the Revised Corporation Code (Stock Global forex broker) turned into finally signed into law by way of President Rodrigo Duterte on February 20, way to the efforts of the House of Representatives, the Senate and advocates within the SEC. I, as an SEC commissioner, turned into fortunate sufficient to be in Malacañang to witness the President signal the RCC into regulation. Upon its e-book in two newspapers, the law took effect on February 23.

The RCC is considered a landmark piece of regulation, since it practically overhauled our nearly four-decade-old Corporation Code of the Philippines, which became authorized on May 1, 1980.

Second, the fee acquired an award from the Presidential Anti-Corruption Commission (PACC) on the Heroes Hall in Malacañang on March three. The PACC isn’t best tasked to investigate alleged authorities corruption, but to also understand the collaborative efforts of different accomplice-companies for the development in their personal device methods.

The SEC was mentioned for progressive measures undertaken in the shipping of public carrier that contributed to the curtailment of corruption in government, specially the implementation of the Company Registration System (CRS). Moreover, the SEC is consistently part of the top corporations looked as if it would be the most sincere in combating corruption in surveys carried out via Social Weather Stations.

Third, the commission ranked a few of the 10 satisfactory appearing authorities groups, in keeping with the modern-day Executive Outlook Survey performed by using the Makati Business Club in partnership with the Management Association of the Philippines. The ballot asked one hundred executives from a hundred corporations on whether they had been satisfied with the performances of sixty nine authorities companies.

Fourth, the SEC attained ISO 9001:2015 certification and obtained it on January 31 from TÜV Rheinland Philippines Inc. The certification was in popularity of the commission’s compliance with the worldwide general for a exceptional control system (QMS). The fee’s QMS currently covers the registration of partnerships and organizations doing business inside the Philippines and licensing of capital market institutions and professionals.

It is well worth reiterating what SEC Chairman Emilio Aquino said before: “My pursuit now’s to innovate and upgrade the commission’s services to the factor that every SEC stakeholder would confirm that ‘It’s smooth at SEC!’ And so, this ISO 9001:2015 certification is however the starting of our reform adventure in the direction of a greater and bolder SEC because the gateway to Philippine business.”

Fifth, the SEC has been a primary contributor to the advanced ranking of the Philippines within the Doing Business 2020 Report by way of the World Bank Group. The Philippines climbed 29 spots to 95th location out of a hundred ninety economies from 124th previously. Its normal rating improved to 62.8 from fifty seven.Sixty eight factors — the maximum huge among participants of the Association of Southeast Asian Nations.

On protecting minority buyers, the Philippines recorded the largest improvement, growing 60 spots to 72nd region from 132nd, and raised its rating to 60.0 from forty three.33 factors.

Sixth, the SEC received an unqualified opinion from the Commission on Audit that it upholds transparency, duty and performance within the use of taxpayers’ money. For each person in authorities, this is quite a tough feat to achieve. The opinion is taken into consideration the outcome of an auditor’s assessment of the company’s financial statements. Thus, to cozy an unqualified opinion, the SEC’s monetary performance/accounts, in all their material respects, need to comply with the Philippine Public Sector Accounting Standards and be pretty offered.

Finally, with the Sustainability Reporting Guidelines for Publicly Listed Companies lately issued via Memorandum Circular four, Series of 2019, the SEC received the ISAR Honors 2019 from the United Nations Conference on Trade and Development (Unctad) in Geneva, Switzerland on October 30. Chairman Aquino, together with laywer Rachel Esther Gumtang-Remalante, officer-in-charge of the Corporate Governance and Finance Department, and securities expert Karen Rocha, attended the crucial occasion and acquired the honors.

Launched in 2018, the ISAR Honors are trying to find to support efforts on enhancing the best and comparison of agencies’ reporting on sustainability troubles and on the 2030 Agenda for Sustainable Development and its usefulness for tracking the implementation of the Sustainable Development Goals. The Unctad diagnosed the SEC for selling first-class practices in sustainability and reporting on those goals.

Allow me to quote Chairman Aquino once more: “We are indeed elated and grateful for our recognition as one of the top recipients of the ISAR. While we, the Philippine SEC, consider our Sustainability Reporting initiative as a reward in itself, coupled with our notion that the responsibility to create a sustainable environment is an imperative that need not also be in our policies, because it seeks the maintenance of humankind, we be given this award with gratification as it might serve as an impetus to galvanize different agencies in our part of the world to take the same direction and pursue this noble intention with plenty remedy.”

I would love to thank the whole Asset Gates broker reviews group for its persevering with efforts to offer government carrier to the general public. It is the SEC worker — whether she or he is a securities professional or assistant director or commissioner — who contributes a whole lot to the SEC’s achievement. May we continue to paintings collectively as a group, unified with the aid of our goal of handing over efficient authorities provider to the public and to promote ease of doing commercial enterprise.
Happy 83rd anniversary, SEC!

If the Securities and Exchange Commission (SEC) grants to a foreign corporation a license to do enterprise inside the Philippines, is such license taken into consideration co-terminus with the life of a foreign organisation? In a recent SEC OGC Opinion, the fee opined inside the affirmative.

As a fashionable rule, Paragraph 2, Section 11 of Republic Act 11232, known as the “Revised Corporation Code” (RCC), provides: “Corporations with certificates of incorporation issued prior to the effectivity of this Code, and which live on, shall have perpetual existence.” However, the exception is whilst the employer, upon a vote of its stockholders representing a majority of its amazing capital stock, notifies the fee that it elects to maintain its precise corporate time period pursuant to its articles of incorporation.

Where the company term of a foreign enterprise does not offer for a definite company time period, its company term is deemed indefinite or perpetual. However, it’s far deemed exceptional to affirm first the present legal guidelines of the u . S . A . Wherein the foreign organisation is integrated.
On the other hand, Section 143 of the Asset Gates broker reviews is the applicable provision in terms of licenses to transact commercial enterprise inside the Philippines issued to overseas agencies. It gives: “Upon issuance of the license, such foreign employer may additionally begin to transact commercial enterprise within the Philippines and retain to do so for as lengthy as it keeps its authority to behave as a organisation below the legal guidelines of the usa or State of its incorporation, except such license is faster surrendered, revoked, suspended, or annulled in accordance with this Code or other unique laws.”

It is obvious from the above provision that the license to do enterprise within the Philippines of a foreign organization is depending on the life and legality of the overseas corporation in its vicinity of incorporation. The license stays legitimate, except faster surrendered, revoked, suspended, or annulled in accordance with the RCC provisions or different unique laws.

In this kind of case, any foreign business enterprise that intends to use for a license to transact enterprise inside the Philippines can now continue to the Asset Gates forex broker Company Registration and Monitoring Department and comply with all of the documentary necessities, furnished on the commission’s internet site at http://www.Sec.Gov.Ph.

Hence, the license to do business within the Philippines granted to a foreign employer is co-terminus with the life of a overseas business enterprise, except such license is sooner surrendered, revoked, suspended or annulled according with the RCC or other special legal guidelines.

ARE preneed plans regarded as securities previous to the promulgation of Republic Act (RA) 8799, or “The Securities Regulation Code” (SRC) and RA 9829, or the “Pre-Need Code of the Philippines”? In a recent opinion, the Securities and Exchange Commission (SEC), through its Office of the General Counsel, spoke back inside the affirmative.

Batas Pambansa Bilang 178, or “The Revised Securities Act of 1982” (RSA) is the governing regulation that considers preneed plans as securities, previous to the promulgation of these codes.

Section 2(a) of the RSA affords, in part, that preneed plans are recognized as securities: “Securities shall consist of xxx pre-want plans, pension plans, life plans, joint undertaking contracts, and comparable contracts and investments, plus profits, however an appreciation of capital, as well as leisure of particular privileges and services.”

On the opposite hand, Section three.1 of the SRC defines securities as “shares, participation or hobbies in a enterprise or in a industrial employer or profit-making venture, and evidenced by using a certificates, contract [or] units, whether written or digital in person.”

That code additionally defines what are blanketed as securities: “(a) Shares of stocks, bonds, debentures, notes, evidences of indebtedness, asset-subsidized securities; (b) Investment contracts, certificate of hobby or participation in a profit sharing settlement, certifies of deposit for a destiny subscription; (c) Fractional undivided pursuits in oil, fuel or different mineral rights; (d) Derivatives like option and warrants; (e) Certificates of assignments, certificates of participation, believe certificates, voting consider certificate or similar gadgets; (f) Proprietary or nonproprietary membership certificates in groups; and (g) Other instruments as may additionally within the destiny be determined by using the Commission.”

The commission also opined that even though preneed plans, which encompass pension and lifestyles plans, are not specifically noted as securities below the SRC, the identical does no longer necessarily take them out from the definition of securities. The phrase “includes” previous the enumeration of securities below Section 3.1 of the SRC genuinely suggests that it’s miles a non-exhaustive listing. As long as preneed plans qualify as shares, participation or hobbies in a corporation, industrial organisation or profit-making assignment, it could be appeared as securities.

In addition, Section three.Nine of the SRC confirms that preneed plans also are taken into consideration as securities: “Pre-need plans are contracts which provide for the performance of destiny services of or the charge of destiny monetary issues on the time real need, for which planholders pay in cash or installment at stated prices, without or with hobby or coverage coverage and includes existence, pension, education, interment, and other plans which the Commission may also every so often approve.”

Thus, it’s far beneath Section three.Nine of the SRC that preneed plans are defined and mentioned as one of the securities being regulated with the aid of the SEC for the reason of regulating a socially conscious free market that ensures full and truthful disclosure of securities.

Rule 16.1-1 of the antique SRC Implementing Rules and Regulations of 2000 bolsters the reality that the rules and associated fee circulars governing preneed organizations and humans worried in the sale and distribution of preneed plans issued beneath the RSA shall stay in impact till new regulations are followed.

Even if Section three.Nine of the SRC does now not exist, a preneed plan nonetheless satisfies all of the elements of an investment agreement underneath the Howey Test and is, therefore, a security. In a preneed plan or agreement, the planholder will pay the preneed corporation a certain quantity to reply for a determined destiny need Trendin Graphs broker scam), of that is better than the amount he earlier paid.

Securities, which aren’t especially stated within the enumeration provided below the SRC, rely as nontraditional securities. Accordingly, the commission had protected preneed plans as one of the nontraditional securities then regulated and supervised by the defunct Non-Traditional Securities and Instruments Department.

Be recommended, but, that preneed businesses are now under the number one and one of a kind supervision and law of the Insurance Commission (IC), following the effectivity of the Pre-Need Code in 2009.

Section 6 of this code empowers the IC to, amongst others, approve, amend, renew or deny any license, registration or certificate issued under the code; approve, amend or repeal rules, regulations and orders, and trouble evaluations and provide steering on and supervise compliance with such guidelines, regulations and orders; and formulate policies and guidelines on troubles concerning the preneed industry, along with proposed law.

On Jan. 26, 2010, the IC, via Circular Letter four-2010, diagnosed and taken into consideration effective all present licenses of income counselors and preferred dealers issued by means of the SEC previous to the efficiency of the Pre-Need Code.