Pursuant to the Memorandum of Understanding dated 12 October 2018 between the regulators of the Philippines, Thailand, Malaysia and Singapore, on 26 February 2019, the Securities and Exchange Commission (“SEC”) issued SEC Memorandum Circular No. 5, series of 2019 (“MC No. 5”) setting forth the guidelines on the implementation of the Association of Southeast Asian Nations (“ASEAN”) Capital Markets Forum Pass (“ACMF Pass”) under the ASEAN Capital Market Professional Mobility Framework.
The ACMF Pass allows more unrestricted movement of capital market professionals licensed from a home country to perform investment advice activities and issue research reports on ASEAN financial products in a host country under the Framework. The guidelines shall apply to:
- Professionals in the Philippines, who intend to obtain an ACMF pass in another country which is a signatory to the MOU;
- Professionals in other signatory countries who intend to obtain an ACMF Pass in the Philippines; and
- “Attached Licensed Firms” or legal persons with authority to undertake business related dealing and giving advice on the capital market products in either the home or host jurisdiction to which the professional is connected or employed.
Under SEC MC No. 5, the following registered capital market professionals in the Philippines are qualified to apply for an ACMF Pass:
- Salesman of a broker dealer and/or investment house;
- Certified Investment Solicitor;
- Key officer/s of Fund Managers (Investment Company Advisers) involved in the management of the fund and licensed by the SEC as Certified Investment Solicitor/s; and
- Other professionals, which the SEC may, in the future, determine as eligible.
The professionals who have successfully obtained an ACMF Pass shall be permitted to: (i) give general investment advice to both retail and non-retail investors concerning ASEAN capital market products, which are limited to shares, bonds, units of collective investments scheme including units of real estate investment trust and units of infrastructure fund; and (ii) issue and promulgate research analysis or research reports concerning capital market products, solely incidental to such giving of general investment advice.
However, the professionals are prohibited from: (i) giving advice to investors by considering the investor’s investment objective, financial situation and particular needs; and (ii) soliciting for sales of capital market products. Further, among other conditions, the professionals must be attached to a licensed firm in the host jurisdiction to service retail and non-retail investors.The ACMF Pass shall be valid for a period of two (2) years and may be renewed annually.