The Securities and Exchange Commission (SEC) reminded companies to comply with reportorial requirements to avoid paying penalties.
“We’re not happy penalizing them at all. It’s an exercise of good corporate governance, submitting your financial statements, (and) general information sheet to your regulators, complying with orders of the SEC, that’s good corporate governance,” said Emilio Aquino, SEC chairman.
Aquino said companies have “very low” compliance in submitting requirements.
In late March, the SEC issued Memorandum Circular No. 6 Series of 2024 imposing higher fines and penalties for the late and non-filing of reportorial requirements by companies starting April 1.
Meanwhile, Aquino said the SEC has delayed the implementation of the increase in fees and charges as it continues to dialogue with business groups.
In July last year, the SEC sought public comment for its plan to raise fees for company applications.
Under the new schedule of fines, domestic stock corporations and one person corporations (OPC) and with retained earnings of not more than P100,000 will incur a basic penalty of P5,000 for the late filing of their general information sheet (GIS) or annual financial statements (AFS), plus P1,000 for every month of continuing violation.
The same penalty applies to domestic non-stock corporations with a fund balance or equity of not more than P100,000.
Non-filing of GIS or AFS by OPCs and domestic stock and non-stock corporations with retained earnings and fund balance/equity, respectively, of not more than P100,000 will incur a basic penalty of P10,000, plus P1,000 per month of continuing violation.
Foreign stock corporations with accumulated income/fund balance/members’ equity of less than P100,000 will incur a fine of P10,000 plus P 6,000 late penalty, if their report is filed after 30 days, or P12,000 penalty, if filed after 60 days.
The SEC plans to he SEC plans to increase the fees for the filing of a company’s articles of incorporation to “1/4 of 1 percent (0.25 percent) of the authorized capital stock but not less than P2500 or the subscription price of the subscribed capital stock whichever is higher” from the “1/5 of 1 percent (0.2 percent) of the authorized capital stock but not less than P2,000 or the subscription price of the subscribed capital stock whichever is higher” for a stock corporation that assigns a par value to its shares.
The SEC is also looking to impose or adjust fees in other company filings such as corporation by-laws, amendments in the articles of incorporation, amendments in by-laws, increase in capital stocks, decrease in capital stocks, mergers of companies, equity restructuring, and others.
It also plans to impose a fee of 0.25 percent (1/4 of 1 percent) to the total value if and when a company files for an application to raise funds through a bond sale.