MANILA, Philippines — The Securities and Exchange Commission hopes to finalize its rules on initial coin offerings (ICOs) this year.
“We want it out already because these are additional products, but we are still studying it,” SEC chairman Emilio Aquino told reporters.
He said regulators are hoping to have the rules in place within the first half, but this may be delayed due to some issues that still need to be threshed out.
Aquino said the rules need to be in place as soon as possible because a number of entities have already expressed interest in cryptocurrencies.
However, he said the SEC can not rush the release of the ICO rules as it is still incorporating the comments from stakeholders.
The rules are meant to encourage the proper use of technology, Aquino said.
ICO is the cryptocurrency equivalent of an initial public offering. It can be a fundraiser wherein a company looking to create a new coin, app, or service launches an ICO.
The SEC’s proposed rules allow an issuer to provide its opinion that the tokens are security. The rules removed the requirement of having an independent counsel issue the opinion during the initial assessment phase.
Another amendment in the proposed rules is allowing the registration of security tokens by non-resident foreign companies if the security tokens have been registered in another jurisdiction.
This will be on the condition that there is an information sharing arrangement in place between the SEC and the competent regulator in the jurisdiction in which the issuer is organized or that the security tokens are registered in another jurisdiction and the issuer provides sufficient proof of such registration and regulatory framework of the jurisdiction.
If these conditions are not met, the foreign issuer will be required to create a branch office in the Philippines, the proposed rules said.
The rules shall govern the conduct of ICOs wherein convertible security tokens are issued by start-ups that are registered corporations organized in the Philippines or start-ups and corporations organized abroad but are targeting Filipinos, through online platforms.
All start ups or corporations organized in the Philippines and duly registered with the SEC that intend to sell ICOs must submit an initial assessment request with the SEC.