By Revin Mikhael D. Ochave, Reporter
THE SECURITIES and Trade Fee (SEC) has launched an incentive program that enables noncompliant and delinquent companies to settle fines and penalties at “significantly” decrease charges.
Functions for the Enhanced Compliance Incentive Plan (ECIP) could be submitted to the regulator till Nov. 30, the SEC mentioned in an e-mailed assertion.
The SEC issued Memorandum Round (MC) No. 13 on the ECIP, which permits companies that didn’t submit annual stories on time “to revive their good standing” by settling fines and penalties.
The brand new plan comes after greater than 81,700 firms availed of the SEC Amnesty Program and complied with reportorial necessities in 2023.
“After the SEC amnesty program, the fee has strictly imposed larger revised fines and penalties to encourage strict and recurring compliance with reportorial obligations and good company housekeeping,” SEC Chairperson Emilio B. Aquino mentioned.
“With the launch of ECIP, we’re affording companies beneath our supervision one other alternative to treatment their violations, at decrease charges, and restore their good standing,” he added.
The ECIP covers unassessed and uncollected fines and penalties for violations such because the late and non-filing of basic data sheet (GIS) for the most recent and prior years, in addition to the late and non-filing of annual financial assertion (AFS).
It additionally applies to companies which have did not designate and submit their official and different e-mail addresses and cell phone numbers as required beneath MC No. 28.
Underneath the ECIP, noncompliant and delinquent companies may settle their unassessed or unpaid fines and penalties for P20,000. This fee will apply provided that the company or entity will submit the most recent reportorial requirement due and adjust to MC No. 28.
Noncompliant companies refer to people who haven’t submitted their GIS and AFS intermittently or consecutively in earlier years.
Companies are deemed delinquent in the event that they fail to file their AFS or GIS 3 times, consecutively or intermittently, inside a five-year interval.
The ECIP additionally covers suspended and revoked companies, together with these with pending petitions for the lifting of the suspension or revocation order issued in opposition to them. They solely must settle 50% of the assessed fines and pay a petition price of P3,060.
Entities which might be excluded from the ECIP embrace companies whose securities are listed on the Philippine Inventory Trade (PSE); whose securities are registered however not listed on the PSE; thought of as public firms; with intra-corporate dispute; with disputed GIS; with expired company time period; and people coated beneath Part 17.2 of Republic Act No. 8799 or the Securities Regulation Code.
Nevertheless, the SEC cautioned that cost of the ECIP price doesn’t imply that companies are robotically “compliant” since they nonetheless must submit supporting paperwork.
Noncompliant and delinquent companies must submit their newest AFS, in addition to their official and alternate e-mail addresses.
For suspended or revoked companies, they need to submit a petition to raise the order of suspension/revocation of certificates of registration, the most recent due AFS and GIS, secretary’s certificates of no intra-corporate controversy, newest mayor’s or enterprise allow, certificates of Bureau of Inner Income registration, in addition to adjust to MC 28.
“Ought to an applicant-corporation fail to submit the entire set of necessities throughout the prescribed interval, the ECIP charges, in addition to the preliminary petition price of P3,060 relevant to suspended and revoked companies, shall be forfeited,” the SEC mentioned.
companies can apply for the ECIP via the SEC’s Digital Submitting and Submission Instrument (eFAST).
“This may be efficient if extra firms comply. It additionally helps on the course of sustaining good standing and enhancing repute to the investing public since compliance indicators good enterprise practices,” Rizal Industrial Banking Corp. Chief Economist Michael L. Ricafort mentioned in a Viber message after being requested for remark.
COL Monetary Group, Inc. Chief Fairness Strategist April Lynn Lee-Tan mentioned in a Viber message that the ECIP may assist increase compliance amongst companies.
Nevertheless, Ms. Tan mentioned that the method could be tough for small firms which might be eager about availing of the ECIP, citing the variety of supporting paperwork that needs to be submitted.
“One of many potential issues with that is that the businesses will nonetheless take steps to avail of the inducement, by which some might encounter challenges,” she mentioned.
“All firms have necessities to file paperwork with the SEC. It’s a problem to get these for some firms, particularly the small ones. If I’m a small firm, I nonetheless have to rent a lawyer and an auditor,” she added.
