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Published
By James A. Loyola
The Securities and Exchange Commission (SEC) is giving foreign corporations more time to present their security deposits in light of the improved community quarantine on Luzon and other parts of the country.
The Commission issued a memorandum circular to grant branches of foreign corporations duly authorized to do business in the Philippines 30 days after the removal of the enhanced community quarantine to present their initial deposits, which originally expire within the quarantine period.
Those who must submit additional deposits during the term of the enhanced community quarantine also receive 30 days from the removal of the quarantine to comply with the requirement.
Additionally, licensees whose deposits expired during quarantine may submit a request for replacement of securities 30 days after the end of the quarantine period.
Under Section 143 of Republic Law No. 11232, or the Philippine Revised Corporation Code, all branches of foreign corporations duly authorized to do business in the country, except foreign banking or insurance corporations, will deposit in the SEC securities for the benefit of the present and future creditors of the licensees.
The deposit may consist of bonds or other evidence of indebtedness from the Government of the Philippines, its subdivisions and political instruments, or from corporations and entities controlled or owned by the government.
The licensee may also deposit shares or debt securities registered under Republic Law No. 8799, or the Securities Regulation Code; shares of national corporations listed on the stock exchange, shares of national insurance companies and banks, any financial instrument that the Commission determines to be adequate or any combination thereof.
“We recognize the impact of the COVID-19 pandemic not only on corporations registered in the Philippines but also on foreign corporations worldwide,” said SEC President Emilio B. Aquino.
He added that “giving corporations more time and flexibility to comply with applicable rules and regulations could go a long way towards easing the burden on the business sector during these extraordinary times.”
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