SEC threatens to revoke licenses of 2 companies

The Securities and Exchange Commission has threatened to revoke the secondary licenses of publicly-listed firms Kuok Philippine Properties Inc. and Edsa Properties Holdings Inc. for non-submission of reportorial requirements in violation of the Securities Regulation Code.

SEC chair Lilia R. Bautista said KPPI and EPHI have failed to file quarterly reports despite repeated demands from the Commission.

If the two firms continue to evade the agency’s reportorial requirements, the SEC will be constrained to cancel their licenses to sell securities to the public.

EPHI is a property development, real estate management and holding company incorporated on Oct. 21, 1987. Formerly MUI Resources Phils., Inc., the current operation of the company is leasing whereby it leases its property to the Shangri-La Plaza Corp. and the EDSA Shangri-La Hotel. EPHI owns a 78.72 percent equity in Shangri-La Plaza Corp.

It also has interests in EDSA Shangri-La Hotel & Resort, Inc. and Shangri-La International Hotel Management Ltd. The company’s assets include a leasable land, a shopping mall and a carpark.

KPPI, on the other hand, was incorporated to primarily engage in the business of property holding and investments. It is also authorized under its present charter to engage not only in the business of property development, but also in the industries of food, trading, agriculture, aquaculture, construction, infrastructure development including energy-related projects, transportation and manufacturing. To date, the company’s holdings consist mainly of investments in land and property developments.

The company derives its financial strength with its strategic alliance with the Kuok Group of Singapore, which is a leading property developer in the Western Pacific Rim. The Kuok Group holds a significant equity interest in the company. The most visible of the Kuok Group’s enterprises have been its successes in hotel ownership and management of the distinguished Shangri-la International hotel chains.

Tightening its guard against delinquent corporations, the SEC is set to cancel the registration certificates of more than 240,000 firms for their failure to submit financial statements and general information sheets and to pay the corresponding fines for the violations committed.

A basic fine of P100,000 is imposed on all SEC-registered corporations that fail to submit annual reports, tender offer reports, proxy statement, and information sheets on time. A P100 penalty will be levied by the SEC for everyday of delay.

The move to revoke the certificates of registration of these firms was spurred by their failure to appear before the SEC’s Company Registration and Monitoring Department (CRMD) on the scheduled hearings. The hearings were called to give the errant firms the opportunity to explain their side and justify why their certificate of registration should not be revoked for non-submission of reports.

The CRMD has started publishing show cause orders to delinquent companies as part of efforts to weed out firms that have been habitually violating reportorial requirements.

Under the show cause orders, corporations are given 30 days from the date of publication to appear before the CRMD‚s Law and Regulation Division, update their files and settle the corresponding fines or penalties.

Last year alone, the SEC revoked the registration of 27,982 delinquent and inactive corporations.

Next year, the SEC will implement its compliance monitoring and evaluation system (CMES) which will provide an automated facility to monitor the compliance of registered entities with government laws and regulations.