Deadline looms for delinquent firms

COMPANIES that have failed to comply with reportorial requirements have until the end of the month to remedy this, the Securities and Exchange Commission (SEC) said.

“With less than a month left before we officially close ECIP (Enhanced Compliance Incentive Plan), we encourage noncompliant, suspended and revoked corporations to complete their applications to ensure the continuous operations of their businesses,” SEC Chairman Emilio Aquino said.

The program, detailed in SEC Memorandum circular (MC) 13, Series of 2024 that was issued in August, gives eligible firms one last chance to regain their good standing and pay penalties at lower rates.

“We remind corporations that the submission of reportorial requirements is mandated by law, and failure to comply could result in the suspension or revocation of their corporate registration,” Aquino said.

Under Republic Act 11232 or the Revised Corporation Code, companies that fail to comply with reportorial requirements three times — consecutively or intermittently — over a five-year period can be declared as delinquent.

Companies can also be suspended or have their certificates of registration/certificates of authority revoked by the regulator.

Updated fines and penalties were detailed by the SEC in April and MC 13 also noted that over 81,700 companies had availed of an amnesty program in 2023.

The ECIP, which aims to build on the progress made, gives noncompliant and delinquent firms a chance to settle fines and penalties for the late filing or non-filing of their general information sheets and annual financial statements, and noncompliance with MC 28, Series of 2020 that required firms to designate valid/alternate email addresses and cellphone numbers.

The ECIP fee for this was set at P20,000 and the firms will also have to submit the required information. Payment of the fee alone will not constitute compliance, the SEC said.

Companies that have been suspended or have had their registrations/certificates of authority revoked, meanwhile, should pay a petition fee of P3,060 and 50 percent of assessed fines.

Again, the regulator said that payment of the petition fee would not automatically lead to the lifting of suspensions/revocations. Petitions, along with supporting documents, will have to be submitted and approved.

Applications, payments and submissions of supporting documents should be made online via the Electronic System for Payments to SEC (ePAYSEC) and the Electronic Filing and Submission Tool (eFAST), the regulator said.

Failure to submit complete requirements before Nov. 30 will lead to the forfeiture of ECIP, petition, and penalty payments.

Not covered by the ECIP are firms whose securities are listed at the Philippine Stock Exchange, those with unlisted but registered securities, firms considered as public companies, those involved in intra-corporate disputes, those with disputed general information sheets, have expired corporate terms, and others covered by reportorial requirements under the Securities Regulation Code.