Privacy Policy

The Securities and Exchange Commission (“SEC”) issued on 22 July 2019 Memorandum Circular No. 15, Series of 2019 (“MC No. 15-19”), amending SEC Memorandum Circular No. 17, Series of 2018, on the Revision of the General Information Sheet (“GIS”) to Include Beneficial Ownership Information.

Following the SEC’s En Banc Resolution dated 27 June 2019, the SEC had previously issued a Notice specifying 31 July 2019 as the implementation date of the 2019 Revision of the GIS. [Our previous article on this may be accessed here.]

The notable provisions of MC No. 15-19 are discussed below.

Section 2.1 defines “Beneficial Owner”, which “refers to any natural person(s) who ultimately own(s) or control(s) or exercise(s) ultimate effective control over the corporation.” It further specifies categories of beneficial ownership.

Section 3 requires a SEC registered corporation to disclose in its GIS adequate, accurate and current information on its beneficial ownership and control. Should there be a relevant change in beneficial ownership, Section 8 requires the submission of an updated GIS within seven (7) working days after such change occurred or became effective. Section 9 recognizes that it is the duty of the Directors/Trustees and Officers of the reporting corporation to exercise due diligence in ensuring the disclosure rule is complied with.

Section 4 provides for the identification of the beneficial owner:

“i. The identity of the natural person(s) who ultimately has controlling ownership interest in the corporation.

ii. The identity of the natural persons (if any) exercising control of the corporation through other means.

iii. The identity of the natural persons composing the Board of Directors/Trustees or any similar body and/or the senior managing official of the reporting corporation.”

Section 6 adopts the Grandfather Rule methodology in computing the percentage of ownership for the determination of natural person who ultimately owns the corporation through indirect ownership. Both the direct and indirect shareholding in the corporation shall be considered.

Section 12 imposes penalties on the reporting corporation for failure to disclose, without any lawful cause, the beneficial ownership. Directors/Trustees and Officers of the corporation are also subject to liability for failure to exercise the due diligence required in ensuring compliance with the disclosure requirement.

Section 13 suspends the submission of GIS in electronic format until further notice.

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