SEC extends ownership disclosure period for listed firms

The Securities and Exchange Commission (SEC) has approved the three-day extension of the deadline to disclose the ownership of officers and directors in shares of listed companies, from the previous two days to five trading days.

SEC chairman Lilia R. Bautista said the commission approved the amendment proposed by the Philippine Stock Exchange (PSE) in an executive meeting last Tuesday.

The PSE board, upon recommendation of the Listing and Disclosure Group (LDG), decided to lengthen the period within which officers and directors are required to disclose their beneficial ownership in shares of listed corporations to allow issuers to reasonably comply with the rule.

In making the said recommendation, the LDG took into account the comments submitted by listed issuers. The transfer agents of issuers, who are in charge of submitting the beneficial ownership report, would get to know of the transaction only on the third day or when the trade is cleared.

The issuers also wanted to align the rules of the exchange with that of the SEC. Under Sec. 13 of the Securities Regulation Code, officers and directors are required to file beneficial ownership reports within 10 days after the transaction.

The rationale of Sec. 13 was to allow the PSE to assist regulators, specifically the personnel from the Compliance and Surveillance Group, to effectively monitor and help curb unfair trade practices such as insider trading and market manipulation.

The PSE noted that the Kuala Lumpur Stock Exchange requires directors and officers to disclose to regulators any acquisition or disposition or changes in their ownership within seven days from acquisition.

The Jakarta Stock Exchange, on the other hand, requires a reporting period of 10 days while the exchanges in Australia and Hong Kong require officers to report within five days from the date of transaction.