THE Securities and Exchange Commission (SEC) has issued Memorandum Circular 13 Series of 2024, or the Enhanced Compliance Incentive Plan (ECIP), granting non-compliant corporations an incentive to restore their good standing.
This follows the agency’s amnesty program that it implemented last year.
“As a regulator, the SEC is committed to ensuring that entities under its supervision are compliant with all the laws, rules and regulations applicable to them,” SEC Chairman Emilio Aquino said in a statement.
“After the SEC Amnesty Program, the commission has strictly imposed higher revised fines and penalties to encourage strict and habitual compliance with reportorial obligations and good corporate housekeeping,” he added.
Aquino noted that the launch of ECIP will afford corporations under their supervision “another opportunity to remedy their violations, at lower fees, and restore their good standing.”
Under ECIP, non-compliant corporations, including those placed under “delinquent” status, may settle their unassessed or unpaid fines and penalties for P20,000, while suspended and revoked corporations, including those with pending petitions for the lifting of the suspension or revocation order issued against them, may settle about 50 percent of their assessed fines and pay the petition fee of P3,060.
The lower rates only apply to fines and penalties imposed are only for corporations with violations of non-filing and late filing of general information dheet (GIS), and non-filing and late filing of financial statements (AFS), whether audited or certified, including fines for the non-filing of the attachments required for certain corporations for the latest and prior years.
“ECIP also covers violations under SEC Memorandum Circular No. 28, Series of 2020, which requires all entities registered with the commission to designate and submit their official and alternative email addresses and mobile phone numbers,” the regulator said.
Eligible corporations that may avail of ECIP are stock and nonstock corporations, including branch offices, representative offices, regional headquarters, and regional operating headquarters of foreign companies, except corporations whose securities are listed on the Philippine Stock Exchange (PSE), whose securities are registered but not listed on the PSE, and those considered as public companies.
Corporations with intra-corporate dispute, disputed GIS, with expired corporate term, and companies covered under Section 17.2 of Republic Act 8799, or the Securities Regulation Code, are also ineligible for the incentive.
“Applications of non-compliant, suspended and revoked corporations for ECIP may be submitted starting September 2, 2024 and until November 30, 2024,” the SEC said.
Non-compliant corporations are those that have not submitted their GIS and AFS consecutively in previous years, while delinquent corporations are those that have failed to file their GIS and AFS for three consecutive times for the period of five years.
The SEC reiterated that “payment of the ECIP fee, in itself, does not automatically confer ‘compliant’ status to availing corporations or lift the suspension and revocation of their certificates of incorporation,” and is still subject to submit corresponding supporting documents.
“For a definitive guidance in availing of the Enhanced Compliance Incentive Plan, please read the full text of SEC Memorandum Circular No. 13, Series of 2024 on the SEC website,” the regulator said.
Earl John Alfaro
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