Published — June 1, 2022
The following post does not create a lawyer-client relationship between Alburo Alburo and Associates Law Offices (or any of its lawyers) and the reader. It is still best for you to engage the services of your own lawyer to address your legal concerns, if any.
Also, the matters contained in the following were written in accordance with the law, rules, and jurisprudence prevailing at the time of writing and posting, and do not include any future developments on the subject matter under discussion.
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On 13 May 2020, the Securities and Exchange Commission (SEC) issued a Notice to Financing Companies (FCS), Lending Companies (LCS) And Microfinance NGOs (MF-NGOS) to extend the mandatory grace period for loans during the Modified Enhanced Community Quarantine (MECQ) or General Community Quarantine Period (GCQ) in view of the imposition of either Modified Enhanced Community Quarantine (MECQ) or General Community Quarantine (GCQ) across the country until 31 May 2020.The Mandatory Grace Period is pursuant to Section 3.01 of the Implementing Rules and Regulations (IRR) of Section 4(aa) of the Bayanihan to Heal As One Act, which reads:
“Section 3.01 Mandatory Grace Period. All Covered Institutions shall implement a 30-day grace period for all loans with principal and/or interest falling due within the ECQ Period without incurring interest on interest, penalties, fees and other charges. The initial 30-day grace period shall automatically be extended if the ECQ Period is extended by the President of the Republic of the Philippines pursuant to his emergency powers under the Bayanihan to Heal as One Act.”
Accordingly, SEC directs all FCs, LCs and MF-NGOs to extend the thirty (30)-day grace period for the payment of loans, with principal and/or interest falling due within the MECQ/GCQ period, from 17 March 2020 to 31 May 2020.
Failure to comply with the provisions of the IRR may result in the imposition of a fine ranging from PhP 10,000 to PhP 1,000,000 and/or two-month imprisonment on responsible individuals.
Alburo Alburo and Associates Law Offices specializes in business law and labor law consulting. For inquiries, you may reach us at info@alburolaw.com, or dial us at (02)7745-4391/0917-5772207.
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