Published — January 6, 2021
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.
Aside from registration, read more about securities here: WHAT ARE SECURITIES?
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A registration statement shall be duly filed with the Securities and Exchange Commission
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All documents or information with respect to registered securities are open to public inspection
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Securities may be exempted from registration
May the public conduct an inspection regarding registered securities?
In our previous article, we mentioned that a person is not allowed to engage in the business of buying or selling securities in the Philippines as a broker or dealer, or act as a sales man, or an associated person of any broker or dealer unless registered as such with the Securities and Exchange Commission (Commission).
What should be done to register securities?
The law says:
A registration statement shall be duly filed with and approved by the Commission. Prior to such sale, information on securities shall be made available to each prospective purchaser.
The Commission may conditionally approve the registration statement under such terms as it may deem necessary. A record of the registration of securities shall be kept in Register Securities. Said register and all documents or information with respect to registered securities are open to public inspection at reasonable hours on business days. The Commission may audit the financial statements, assets and other information of the firm applying for registration of its securities whenever it deems necessary to insure full disclosure or to protect the interest of the investors and the public in general.
Thus, in response to the first question above, yes, the public may conduct an inspection regarding registered securities.
Is there an exemption from registration of securities?
The law says:
Yes.
As a general rule, the requirement of registration of securities does not apply to any of the following classes of securities:
- Any security issued or guaranteed by the government or by any person controlled or supervised by the government;
- Any security issued or guaranteed by the government of any country which the Philippines maintains diplomatic relations on the basis of reciprocity. This is on the condition that the Commission may require compliance with the form and content for disclosures the Commission may prescribe;
- Certificates issued by a receiver or by a trustee in bankruptcy duly approved by the proper adjudicatory body;
- Any security or its derivatives the sale or transfer of which, by law, is under the supervision and regulation of the Insurance Commission, Housing and Land Use Regulatory Board, or the Bureau of Internal Revenue; and
- Any security issued by a bank except its own shares of stock.
Now there are instances where the application for registration of securities may be rejected. A related article will be posted in a few days.
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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