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Frequently Asked Questions
1. What is a Corporation?
A juridical person created by operation of law and registered with the Securities
and Exchange Commission.
2. What is a stock corporation?
A corporation with authorized capital stock dividend into shares of stock either
with or without par value. A stock corporation is engaged in income generating
activities and is authorized to declare dividends.
3. What is a non-stock corporation?
A corporation with no authorized capital stock. It is organized for charitable,
religious, educational, professiona, cultural, fraternal, literary, scientific,
social civil service, or similar purposes, like trade, industry, agricultural and
like chambers, or any combinations thereof.
4. When is a corporation deemed to have a juridical personality?
A corporation is deemed imbued with juridical personality from the time the
Certificate of Incorporation is issued by the Securities and Exchange Commission.
5. What are the requirements for registration of a corporation?
A. Stock Corporation
B. Non-Stock Corporation
C. Foreign Corporation
6. Where can the proposed corporate or partnership name be verified?
The proposed corporate or partnership name can be verified online via Iregister
system of SEC; or thru Name Verification Unit at G/F Secretariat Building, PICC
Complex, Roxas Boulevard Pasay City; or thru Satellite Offices and SEC Extension
Offices.
7. If the proposed name is verified and reserved online, does this still need
confirmation from Name Verification Unit or SEC Satellite/Extension Offices?
Company names reserved online must be confirmed at the Name Reservation Unit, G/F
Secretariat Building, PICC Complex, Roxas Boulevard Pasay City or at any of the SEC
Satellite Offices within four (4) calendar days from date of online reservation.
Non-confirmation of reservation within the specified period will forfeit the online
reservation. Confirmation is required because the Corporation Code of the
Philippines, Sec. 18 provides that No corporate name may be allowed by the
Securities and Exchange Commission if the proposed name is identical or deceptively
or confusingly similar to that of any existing corporation or to any other name
already protected by law or is patently deceptive, confusing or contrary to
existing laws. Compliance therewith compels us to personally determine if reserve
names are not deceptively or confusingly similar or patently deceptive or confusing
to other registered entities. After confirmation, applicant must secure a
Reservation Payment Confirmation. A mere Reservation Notice is not sufficient for
the acceptance of any application for registration, or change of name of a
corporation or partnership. Once the Reservation Payment Confirmation has been
issued, the reservation fee must be paid at the Cashier, SEC Main Office or at any
of the designated Landbank branches.
8. If the proposed name has been allowed for use, would there be fees required
to reserve and where shall the payment be made?
Yes.To reserve a name the SEC collects P100.00 as reservation fee for thirty days.
The payment can be thru SEC Cashier or thru on collection systems of Landbank.
9. Does SEC have online fill-out form for the AI-BL?
A. Stock Corporation
B. Non-Stock Corporation
C. Foreign Corporation
10. What are the contents of the AI?
The contents of the AI are the following:
a)The name of the corporation
b)The specific purpose or purposes for which the corporation is being incorporated
c)The place where the principal office of the corporation is to be located, which
must be within the Philippines
d)The term of which the corporation is to exist
e)The names, nationalities and residences of the incorporators
f)The number of directors or trustees, which shall not be less than five (5) nor
more than fifteen (15)
g)The names, nationalities and residences of persons who shall act as directors or
trustees until the first regular directors or trustees are duly elected and
qualified
h)If it be a stock corporation, the amount of its authorized capital stock in
lawful money of the Philippines, the number of shares into which it is divided, and
in case the share are par value shares, the par value of each, the names,
nationalities and residences of the original subscribers, and the amount subscribed
and paid by each on his subscription, and if some or all of the shares are without
par value, such fact must be stated.
i)If it be a non-stock corporation, the amount of its capital, the names,
nationalities of the contributors and the amount contributed by each
j)The name of the treasurer-in-trust
k)Tranfer clause
l)Such other matters as are not inconsistent with law and which the incorporators
may deem necessary and convenient
11. Is there a rule on the approval of the corporate and partnership names?
Yes. The Corporation Code of the Philippines provides in Section 18 that no
corporate name may be allowed by the SEC if the proposed name is identical or
deceptively or confusingly similar to that of any existing corporation or to any
other name already protected by law or is patently deceptive, confusing or contrary
to existing laws.
12. Does SEC have guidelines on the approval of corporate and partnership names?
Yes. In implementing Section 18 of the Corporation Code, the Commission has adopted
Guidelines in the approval of corporate and partnership names.
13. What do you mean by incorporators?
Are the individual persons originally forming the corporation and are the
signatories in the Articles of Incorporation.
14. What are the requirements on incorporators?
All incorporators must be natural persons, of legal age, their number must be at
least five (5) and not more than fifteen (15), every incorporator is subscriber of
at least one share, and majority of the incorporators are residents of the
Philippines.
15. Are foreigners allowed as incorporators?
Yes provided that all requirements for incorporators are complied with and provided
further that the business activity of the corporation is not fully reserved for
Filipino ownership.
16. Can all incorporators be foreigners?
Yes. Provided that all the requirements for incorporators under the Corporation
Code are complied with and this is true for registration under the Foreign
Investment Act of 1991 as amended by RA 8179.
17. How many Directors/trustees may a corporation have?
For a stock corporation, the number of directors must be at least five (5) but not
more than fifteen (15). For a non-stock corporation, the number of trustees must be
at least five (5) and could be more than fifteen. For religious societies, the
number of trustees must be at least five (5) but not more than fifteen (15). For
non-stock educational corporation, the number of trustees must be at least five (5)
but not more than fifteen (15) and the number of trustees must be in multiples of
five (5). And, for a corporation sole, the trustee is only one (1).
18. What are the requirements on directors/trustees?
a)Natural person and is of legal age
b)Compliant with the required number required under the Corporation Code
c)Majority of the directors are residents of the Philippines
d)Holder of at least one share or a member in case of non-stock corporations
e)Not convicted by final judgement of an offense punishable by imprisonment for a
period exceeding six years, or a violation of the Code committed within five (5)
years prior to the date of his election or appointment.
19. What is the difference between directors and trustees?
For stock corporations, the appropriate term is "director". For non-stock
corporations the appropriate term is "trustees". In a non-stock corporations
however, the trustees may be called by other than trustees (i.e. directors)
provided that the term used is identified as such in the Articles of Incorporation
referring to trustees.
20. Can foreigners be elected as director?
Yes. Except in corporations whose business activities are hundred percent reserved
for Filipinos.
21. Is there any limit on the number of seat for foreigners in the board?
Yes. If the business activity is partly nationalized, the number of seat for
foreigners in the board of directors is in proportion of their present foreign
equity to the number of directors as stated in the Articles of Incorporation. Also,
the number of their seats should not exceed the proportion of the allowable foreign
equity to the number of the directors in the AI in accordance with Anti-Dummy Law.
22. If the corporation is registered under the Foreign Investment Act, can
foreigners be all the directors?
Yes. It is subject however to compliance with the requirements of the Corporation
Code on Directors (i.e. majority are residents of the Philippines).
23. Can foreigner sit as trustee in a non-stock corporation?
Yes. If its a non-stock corporation and is engaged in partially nationalized
activities, the foreigners number of seat in the trustees should be compliant with
the provision of Anti-Dummy Law.
24. Is there any requirement of the Corporation Code on primary purpose and
secondary purposes to be indicated in the Articles of Incorporation?
Yes. Under Sec. 15 of the Code it states that if there is more than one purpose,
indicate primary and secondary purpose.
25. Is there any limit on number of secondary purposes?
None. As many secondary purposes a corporation would like to engage except if the
business activities in the primary and secondary are prohibited by existing laws to
be in the Articles of Incorporation of one and the same corporate entity.
26. What are business activities not allowed to be in the primary and secondary
purposes at the same time?
a)Business activities of overseas recruitment and travel agency cannot be in single
entity pursuant ot the implementing rules and regulations of the Labor Code of the
Philippines;
b)A corporation sole or religious society and school as the school should be
incorporated distinct with a religious corporation.
27. Are there business activities that no foreign's ownership is allowed?
Yes. These business activities are fully reserved to Filipino citizens as follow:
a)Mass Media
b)Practice of professions
c)Retail trade enterprises with paid-up capital of less than US$2,500,000
d)Private Security Agencies
e)Small scale mining
f)Utilization of marine resources in archipelagic waters, territorial sea, and
exclusive eonomic zone as well as small-scale utilization of natural resources in
rivers, lakes, bays and lagoons
g)Ownership, operation and management of cockpits
h)Manufacture of firecrackers and other pryrotechnic devices.
28. Are there business activities wherein up to twenty five percent (25%)
foreigners ownership is allowed?
Yes. Participation of foreigners to the extent of 25% is allowed in the following:
a)Private radio communications network
b)Private recruitment whether for local of overseas recruitment
c)Contract for the construction and repair of locally funded public works
d)Contracts for the construction of defense related structures.
29. Are there business activities wherein up to thirty percent foreigner's
ownership is allowed?
Yes. It's the business activity of advertising.
30. Are there business activities wherein up to forty percent of foreigner's
owenship is allowed?
Yes. These business activities are as follows:
a)Exploration, development and utilization of natural resources
b)Ownership of private lands
c)Operation of public utilities
d)Educational institutions other than those established by religious groups and
mission boards
e)Culture, production, milling, processing, trading except retailing of rice and
corn and acquiring, by barter, purchase or otherwise, rice and corn and the by-
products thereof
f)Contracts for the supply of materials, goods and commodities to government-owned
or controlled corporation, company, agency or municipality
g)Facility operator of an infrastructure or a development facility requiring a
public utility franchise
h)Operation of deep-sea commercial fishing vessel
i)Adjustment companies
j)Ownership of condominium units
k)Manufacture, repair, storage, and/or distribution of products and/or ingredients
requiring Philippine National Police (PNP) Clearance
l)Manufacture, repair, storage and/or distribution of products requiring Deparment
of National Defense (DND) clearance
m)Manufacture and distribution of dangerous drugs
n)Sauna and steam bathhouses, massage clinics and like other activities regulated
by law because of risks posed to public health and morals
o)Domestic market enterprises with paid-in equity capital of less than the
equivalent of US$200,000
p)Domestic market enterprises, which involved advanced technology or employ at
least fifty direct employees with paid-in equity capital or less than the
equivalent of US$100,000
31. Are there business activities wherein foreigner's ownership could be more
than forty (40) percent up to one hundred percent?
Yes.
a)Export enterprises and
b)Domestic market enterprises with paid-in equity capital of at least the
equivalent of US$200,000
c)Domestic market enterprises, which involved advanced technology or employ at
least fifty direct employees with paid-in equity capital of at least the equivalent
of US$100,000
32. Are practices of professions allowed in corporate form?
The general rule is NO. However, there are practices of professions allowed now in
corporate form as follow
a)Practice of architecture
b)Practice of interior design
c)Practice of real estate services
d)Practice of customs brokerage
33. What is authorized capital stock?
This is the total amount of shares a corporation is allowed to issue if the shares
have a par value. If the shares do not have a par value, the corporation does not
have an authorized capital stock but it has an authorized number of shares it may
issue.
34. What is subscribed capital stock?
It refers to the total number of shares issued or subscribed by the stockholders.
35. What do you mean by pre-incorporation subscription?
It refers to the required number of shares to be subscribed for purposes of
incorporation. The pre-incorporation subscription should be stated in the Articles
of Incorporation.
36. Is there a minimum amount of subscribed capital stock?
Yes. Under the Corporation Code, at least 25% of the amount subscribed must be
paid-up.
37. Is there a minimum amount of paid-up capital stock?
Yes. Under the Corporation Code, at least 25% of the amount subscribed must be
paid-up and in no case be less than Five Thousand (P5,000.00) Pesos. The foregoing
amount however shall not apply, if there is a law, rule or regulation of other
regulatory agencies requiring a higher minimum paid-up capital.
38. What is paid-in capital?
It refers to the amount paid by subcribers over and above the par value of shares
or the issue value in no-par value shares.
39. What are the considerations for issuance of shares?
Under Sec. 62 of the Corporation Code, stocks shall not be issued for a
consideration less than the par or issued price thereof. Consideration for the
issuance of stock may be any or a combination of any two or more of the following:
(1)Actual cash paid to the corporation;
(2)Property, tangible or intangible, actually received by the corporation and
necessary or convenient for its use and lawful purposes at a fair valuation equal
to the par or issued value of the stock issued;
(3)Labor performed for or services actually rendered to the corporation;
(4)Previously incurred indebtedness of the corporation;
(5)Amounts transferred from unrestricted retained earnings to stated capital; and
(6)Outstanding shares exchanged for stocks in the event of reclassification or
conversion. Where the consideration is other than actual cash, or consists of
intangible property such as patents or copyrights, the valuation thereof: shall
intially be determined by the incorporators or the board of directors, subject to
the approval by the Securities and Exchange Commission.
40. What is contributed capital?
It refers to the amount contributed to non-stock corporations.
41. Is there a minimum amount for contributed capital in non-stock corporations?
Any amount will suffice as a general rule. However, in the case of registration of
a "foundation", the minimum contributed capital is P1,000,000.00. The amount is
required to be deposited in the bank in the name of the treasurer-in-trust. For
registration, a bank certificate of deposit is required for the P1,000,000.00.
42. If the payment is other than cash for shares, what are the additional
requirements for each and every consideration for the issuance of shares?
The additional requirements are as follow:
a.Land and/Building/Condominium unit
1. Detailed schedule of the property showing the registered owner, location area,
TCT/CC No., tax declaration No., and the basis of transfer value (appraised/market
value/assessed value/zonal value) certified by the treasurer
2. Copy of TCT/CCT and tax declaration sheet certified by Register of Deeds and
Assessor's Office, respectively
3. Latest zonal value certfied by BIR, if transfer value is based on zonal value
5. Deed of assignment
6. If property is mortgaged, submit mortgagee/credits certification on the
outstanding loan balance and written consent to the transfer of property
7. For assignment of building where assignsor is nor owner of the land, submit
lease contract on land and consent of landowner to the transfer
a.Untitled Lands
10. Blue print Survey of the Plan as approved by the Bureau of Lands
11. Detailed schedule of the property showing its registered owner, location, area,
tax declaration number and the basis of tranfers value (market value/assessed
value/zonal value or appraised value)
12. Latest zonal valuation certified by BIR, if transfer value is based on zonal
value
13. Appraisal report by authorized appraiser, if transfer value is based on
appraised value (not more than 6 month old)
c.Inventories/Furniture/Personal Properties
1. Detailed schedule of the properties showing the description and the transfer
value certified by the treasurer
2. Deed of assignment
1. Detailed schedule of the property showing the description and transfer value
certified by the treasurer
2. Appraisal report by authorized appraiser (not more than 6 month old). If the
property is imported, valuation-report with description of the property by the
Bangko Sentral ng Pilipinas.
3. Deed of assignment
e.Shares of Stock
1. Detailed schedule of the shares of stock showing the name of stockholder, stock
certificate number, number of shares and the basis of transfer value whether market
or book value certified by the treasurer
2. Audited financial statements of the investee company as of the last fiscal year
stamped received by BIR and SEC
3. Deed of Assignment
4. Certification by the Corporate Secretary of the investee company that the shares
of stock are outstanding in the name of assignor
f.Motor Vehicle
1. Detailed schedule of the motor vehicle showing the registered owner, make/model,
plate number, chassis number, motor number, certificate of registration number and
market value certified by the treasurer
3. Appraisal report by authorized appraiser (not more than six month old)
4. Deed of assignment
g.Sea Vessel/Aircraft
5. Deed of assignment
h.Intangible
4. Deed of Assignment
4. List of creditors showing the amount due to each creditor as of date of the AFS
certified by the auditor or certified under oath by the company accountant and
written consent of creditors
7. Copy of TCT/CCT and tax declaration sheets certified by the Register of Deeds
and Assessor's Office, respectively
1. What is a partnership?
Article 1767 of the Civil Code defines a partnership. Thus: "Article 1767. By the
contract of partnership two or more persons bind themselves to contribute money or
industry to a common fund, with the intention of dividing the profit among
themselves."
A partnership exists where two or more individuals' combine their capital,
property, skill or labor, or all of these, for the transaction of a lawful business
for gain, upon an understanding that profits or losses shall be shared or borne by
them in certain proportions.
2. How is partnership distinguished with corporation?
In Creation: A partnership is created by mere agreement of the parties, being a
consensual contract and governed by Articles 1767 to 1867 of the Civil Code of the
Philippines
A corporation is created by operation of law, which is the Corporation Code of the
Philippines. It is now created by the mere agreement of the incorporators. It is
the State, which will authorize its incorporation to be recognized as a legal
entity.
In number of persons:
A corporation acquires juridical personality only from the date of issuance of the
Certificate of Incorporation by the SEC.
In management:
In a partnership, each partner can act for the partnership. The general rule is
that each partner is an agent of the partnership and his acts and contracts are
binding thereon unless otherwise provided in the articles of partnership.
In liability of members:
In a partnership, the partners are personally liable for the full extent of the
debts of the partnership. This is based on the rule that the acts and contracts of
a partnership are those of the individual members thereof, except that the limited
partners as such are not bound by the obligations of the partnership (Article 1843,
Civil Code).
In a corporation, the stockholders cannot be made personally liable for the debts
of a corporation beyond the amount of their subscriptions. This is based on the
rule that the debts of a corporation are the debts of a legal entity and are not
the debts of the individual stockholders.
In duration:
A corporation can exist only for fifty (50) years and extendable to more than fifty
(50) years in any one instance.
In manner of dissolution:
A partnership can be dissolved at any time by the will of any or all of the
partners.
In a corporation, a corporation may be dissolved only with the approval and consent
of the State.
1. What is Merger?
Merger is one where a corporation absorbs the other and remains in existence while
others are dissolved. (Section 76, Corporation Code of the Philippines).
Merger is a union whereby one or more existing corporations are absorbed by another
corporation which survives and continues the combined business. (PNB vs. Adrada
Electronic & Engineering Co.)
2. What is Consolidation?
Consolidation is one where a new corporation is created, and consolidating
corporations are extinguished. (Section 76, Corporation Code of the Philippines)
Consolidation is the union of two or more existing corporations to form a new
corporation called the Consolidated Corporation. (PNB vs. Andrada Electric &
Engineering Co.)
Filing an Appeal
c) A Verified Pleading;
A. What Certification Seminars are offered by the Commission? What are the
requirements/fees for registration and schedules of the seminars?
1. The Commission offers the following Certification Seminars as prerequisite to
the Licensure Examination:
a) Associated Person Certification Program (APCP), PhP5,000
b) Certified Securities Representative Certification Program (CSRCP), PhP5,000
2. The SEC Economic Research and Training Department (ERTD) conducts a total of
six (6) seminars per year for APCP and two (2) per year for CSRP. Definite
schedules for each seminar are announced on the SEC website. Special sessions with
a minimum of 15 participants, may be requested through a formal letter addressed to
ERTD Officer-in-Charge Lilia O. Pinzon. Such sessions may be conducted in Metro
Manila or in areas where there are SEC extension offices (Tarlac, Baguio, Cagayan
de Oro, Iloilo, Davao, Legaspi, Cebu and Zamboanga).
B. What Licensure Examinations are offered by the Commission? What are the
requirements/fees and schedule for the examinations?
1. The Licensure Examinations administered by the Commission are the following:
a) Associated Person Certification Program (APCP), 5 modules at PhP500/module
b) Certified Securities Representative Certification Program (CSRCP), PhP500
c) Investment Company Representative Certification Examination (ICRCE), PhP500
d) Certification Program for Fixed Income Market Salesmen, PhP2,500 for first time
takers, PhP500 for retakers
2. Two types of examinations administered by the Commission:
a) Computer based – conducted at the SEC Head Office only.
b) Pen and paper – conducted in areas where there are extension offices
3. 3. Schedule for Licensure Examinations:
a) Regular (scheduled every 2nd and last Friday of every month at the SEC Head
Office)
b) Special (scheduled upon approval of a formal request addressed to SEC ERTD
OIC Lilia O. Pinzon with a minimum of 20 applicants).
C. What are the steps for registration for the seminars and application for the
examinations?
The following are the steps for filing of registration for the seminars and/or
application for the licensure examinations:
a. Submission of a fully accomplished registration form for the seminars and
application form for the licensure examinations to the SEC-ERTD. The
registration/application form can be downloaded from this link: Application Forms.
b. Payment of the registration/application fee to the SEC cashier on the ground
floor, SEC Building. A photocopy of the Official Receipt must submitted to the SEC-
ERTD before an applicant is scheduled for either a seminar or licensure
examination.
D. How to get the Results of Examinations?
a. For examinations conducted at the Head Office, results are posted on the SEC
website three (3) to four (4) working days after the examination.
b. For examinations conducted elsewhere, results are posted on the SEC website
thirty (30) working days after the examination
c. Congratulatory letters, which may be used as proof of passing the
examination, are sent to successful examinees two weeks after the posting of the
results.
d. Reprinting of a lost congratulatory letter may be requested from the SEC-ERTD
with a formal request addressed to OIC Lilia O. Pinzon, and the payment of a re-
printing fee of PhP300 and submission of the following supporting papers: 1)
Affidavit of loss; 2) Photocopy of 2 valid IDs
e. For correction of certain details pertaining to the congratulatory letter,
the following are required: 1) request letter addressed to OIC Lilia O. Pinzon; 2)
Photocopy of 2 valid IDs; 3) Original congratulatory letter..
Corporate Governance Related Matters
5. When are companies required to post the consolidated changes and updates in
the ACGR?
The consolidated changes and updates in the ACGR are required to be posted in the
companies’ website within ten (10) days from the end of the calendar year, i.e.,
January 10.
6. In what format should the consolidated changes and updates be?
The consolidated changes and updates incorporate the said changes and updates for
the year in the pertinent portion of the company’s ACGR. What is posted within ten
(10) days from the end of the calendar year is the whole SEC Form – ACGR, updated
to contain all the changes and updates for the previous year.
7. Who are required to attend corporate governance trainings every year?
Members of the board of directors and key officers of publicly-listed companies
(PLCs) are required to attend, at least once a year, a training or seminar on
corporate governance with an SEC-accredited training provider. The training is at
least four (4) hours.
8. Who are considered as key officers of publicly-listed companies?
The key officers refer to all officers provided in the company’s by-laws, all
members of the Audit Committee, the Internal Auditor and Compliance Officer.
9. What topics are covered in a corporate governance training?
Part IV of SEC Memorandum Circular No. 2, Series of 2015 provides for the SEC
mandated topics for corporate governance trainings. The mandated topics are
required only for the first training/seminar of a director or key officer.
Companies are free to choose any corporate governance issue/topic for subsequent
trainings/seminars.
10. Does the SEC allow companies to conduct their own corporate governance (in-
house) trainings?
Yes, companies can conduct their own corporate governance trainings. This can be
conducted by the company on its own or in partnership with an accredited training
provider. For guidelines on this, please see SEC Memorandum Circular No. 2, Series
of 2015.
11. Does the SEC grant exemptions from compliance with the corporate governance
training requirement?
Exemptions may be granted from compliance with the training requirement subject to
the approval of the Commission En Banc upon submission of sufficient proof of the
director or key officer’s good standing and the company’s good corporate
governance.
12. Does SEC conduct corporate governance trainings for publicly-listed companies
(PLCs)?
No. The Commission has accredited institutional training providers to conduct in-
house trainings or public seminars for PLCs. A list of these training providers are
found in the SEC website under NOTICES.
13. Are all companies covered by the Revised Code of Corporate Governance?
The covered companies are registered corporations and branches or subsidiaries of
foreign corporations operating in the Philippines that (a) sell equity and/or debt
securities to the public that are required to be registered with the Commission, or
(b) have assets in excess of Fifty Million Pesos (Php50,000,000.00) and at least
two hundred (200) stockholders who own at least one hundred (100) shares each of
equity securities, or (c) whose equity securities are listed on an Exchange, or (d)
are grantees of secondary licenses from the Commission, such as: (i) stockbroker;
(ii) investment house/underwriter of securities/ica/fund managers/mutual fund
distributors; (iii) investment companies; (iv) financing companies that have total
assets of Fifty Million Pesos (Php50,000,000.00) or more, or have more than forty
percent (40%) foreign participation in their voting stock, or have issued exempt or
registered commercial papers.
14. What is an Exchange?
Exchange is an organized marketplace or facility that brings together buyers and
sellers, and executes trades of securities and/or commodities. Example of which is
the Philippine Stock Exchange.
15. What is Corporate Governance?
Corporate Governance is the framework of rules, systems and processes in the
corporation that governs the performance by the Board of Directors and Management
of their respective duties and responsibilities to the stockholders.
16. What are Publicly-Listed Companies (PLCs)?
Publicly-Listed Companies are those companies whose securities are listed and
traded on an Exchange.
17. What is a Public Company?
A public company is a registered corporation that has assets in excess of Fifty
Million Pesos (PhP50,000,000.00) and has two hundred (200) or more shareholders,
which hold at least one hundred (100) shares of a class of its equity securities.
18. Is a Publicly-Listed Company required to have its own official website?
Yes. The Commission issued SEC Memorandum Circular No.11, Series of 2014 also known
as “Template for Publicly-Listed Companies’ Websites” to promote better corporate
governance environment. Company information and disclosures are arranged under
recommended topic headings so that investors can easily search material and timely
information about the company.
19. How many Independent Directors should PLCs, issuers of registered securities
and public companies have?
SRC Rule 38 (7)(A) requires at least two (2) independent directors or at least
twenty percent (20%) of its board size, whichever is lesser but in no case less
than two (2). They may however choose to have more independent directors in their
board than as above required. All other companies are encouraged to have IDs in
their boards.
20. Do Independent Directors have a term limit?
There shall be no limit in the number of companies that a person may be elected as
Independent Director (ID), except in business conglomerates where an ID can be
elected to only five (5) companies of the conglomerate, i.e. parent company,
subsidiary or affiliate. An ID can serve as such for five (5) consecutive years,
provided that service for a period of at least six (6) months shall be equivalent
to one (1) year, regardless of the manner by which the ID position was relinquished
or terminated. After completion of the five-year service period, an ID shall be
ineligible for election as such in the same company unless the ID has undergone a
“cooling-off” period of two (2) years, provided, that during such period, the ID
concerned has not engaged in any activity that under existing rules disqualifies a
person from being elected as ID in the same company. An ID re-elected as such in
the same company after the “cooling-off” period can serve for another five (5)
consecutive years. After serving as ID for ten (10) years, the ID shall be
perpetually barred from being elected as such in the same company, without
prejudice to being elected as ID in other companies outside of the business
conglomerate, where applicable, under the same conditions provided for in SEC
Memorandum Circular No.9, Series of 2011.
21. When will the “cooling-off” period for Independent Directors (IDs) begin?
Pursuant to SEC Memorandum Circular No.9, Series of 2011, IDs elected in 2012 may
be re-elected as such for five (5) consecutive years, or until 2017, when the two
(2) year cooling off period shall commence.
22. How often is the Manual on Corporate Governance (MCG) submitted to the SEC?
The MCG is submitted to the SEC every time there is a revision in the MCG due to
amendment/s to the Code and/or any change in policy/ies adopted by the company or
by the SEC.
23. Are closely-held corporations covered by the Revised Code of Corporate
Governance?
Closely-held corporations such as family corporations are not covered by the RCCG
but are encouraged to adopt CG principles and practices.
Mutual Fund Companies, and Issuers of Proprietary and Non-Proprietary Issuers of
Securities Matters
Request for a copy of Audited Financial Statement (AFS), General Information Sheet
(GIS) and/or other company filings
2. Once fees are assessed, and the researcher has given the ICTD the go-signal to
proceed with processing the data, an assessment form is issued for the payment of
deposit fee in the amount of PhP200.00 to the SEC Cashier at the Ground Floor,
Secretariat Building, PICC. The researcher should submit the receipt to ICTD for
recording.
3. Prior to release of data, the ICTD will issue the assessment form for the
processing fee balance. The researcher needs to pay the balance at the SEC Cashier,
and upon presentation of the proof of payment, the ICTD releases the data.
4. Processing of data takes fifteen (15) days from receipt of deposit fee. The ICTD
will advise the researcher on when the data becomes available for pick-up.
1. How can we obtain investments and registration statistics from the SEC?
Please visit Registered Firms and Individuals for the list of free data sets.
a. Walk-In Inquiries
The public (individual and institutional researchers) may file a request in person
to the Economic Research and Training Department (ERTD) at SEC Main Office, G/F
Secretariat Building, PICC Complex, Roxas Boulevard Pasay City c/o Ms. Eleanor T.
Dungo and Ms. Ma. Theresa M. Bersabal.
The requesting party must identify the purpose of the request and the specific data
elements needed. Once the request has been evaluated and confirmation obtained that
data can be generated, the researcher will be advised of the following
a. Issuance of assessment form for the payment of deposit fee in the amount of
PhP200.00 to the SEC Cashier at the SEC Main Office, G/F Secretariat Building, PICC
Complex, Roxas Boulevard Pasay City, 1307.
b. The researcher should submit the receipt to ERTD for recording of the OR
details.
c. Processing of data takes fifteen (15) days from receipt of deposit fee.
d. The ERTD will advise the researcher on when the data becomes available for pick-
up.
e. Prior to release of data, the ERTD will issue the assessment form for the
processing fee balance. The researcher needs to pay the balance at the SEC Cashier,
and upon presentation of the proof of payment, the ERTD releases the data.
Type:
A. A company is registered with the Commission
B. An individual is a holder of a secondary license/s such as Compliance
Officer, Associated Person, Salesman, Fixed Income Market Salesman and Certified
Investment Solicitor
C. A company is authorized or permitted to sell securities registered with the
Commission
Procedures:
1. The requesting party shall prepare a letter addressed to the appropriate Head
of the Operating Department requesting for a Certification with attached supporting
documents, if necessary.
2. The Executive Assistant/Clerical Staff of the Department, will prepare the
Payment Assessment Form (PAF) and advise the requesting party to pay the
corresponding Fee to the cashier.
3. The requesting party shall return the proof of payment as well as the letter-
request to the Executive Assistant/Clerical Support.
4. The Executive Assistant of the Department shall forward the said request form
and other attachments directly to the handling lawyer for processing of the
Certification.
5. Prior to the issuance of a Certification, if deemed appropriate, the handling
lawyer, will prepare a Memo to other Department/s concerned requesting its input
subject of the request.
6. Upon receipt of the Memo from the other Department containing its input
subject of the request, the handling lawyer will proceed with the preparation of a
Certification and seek approval/signature of the Director to the Certification.
7. The Executive Assistant shall release the Certification to the requesting
party.
Procedures on Filing of Exemptive Relief
Be wary of unexpected telephone calls, letters, or even personal visits from people
who offer quickprofit schemes that require your immediate investment. Be suspicious
of "inside information," hot tips, and rumors that supposedly will give you a big
advantage over other, less knowledgeable investors. Turn down money request
accompanied by highpressure warnings like "Tomorrow will be too late", "Positioning
is important" or "Act now because there will soon be long waiting lists of others
who want to take advantage of this golden opportunity." Be wary of schemes that
give emphasis on recruitment of members or "downlines", particularly if the product
being offered is overpriced, as the same may be a disguised pyramiding scheme. Do
not engage in foreign currency trading unless you fully understand the mechanics or
dangers of currency trading and can afford to lose your money (margin or security
deposit). There is no such thing as a guaranteed return in currency trading. Ask
for a prospectus, offering circular, financial statement, or other similar document
before you even consider investing. Then read the small print carefully,
particularly on refund, and make sure you understand the terms thoroughly before
signing any kind of commitment. When in doubt, make no promises or commitment, no
matter how tentative. Remember, "if it sounds too good to be true, it usually is."
It is far better to wait and lose an opportunity than to take the plunge and lose
everything. Before making a commitment, get an opinion from your lawyer,
stockbroker, accountant, or the appropriate government office. Always demand
official receipts in the name of the corporations or entities you are dealing with.
Note that a Primary SEC Registration only grants juridical personality. It does not
automatically give a company the authority to engage in all types of business
activities such as lending, selling of securities and investment contracts,
investment taking, etc. To confirm that the company or individual is properly
licensed to conduct the business in question and has no history of violating the
law, get in touch with the SEC:
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