MANILA, Philippines — The Securities and Exchange Commission (SEC) is urging non-compliant, suspended and revoked corporations to clear their records as the deadline of its Enhanced Compliance Incentive Plan (ECIP) draws near.
The SEC said that corporations have only less than a month left to clear their penalties and avoid higher fines for the late and non-filing of reportorial requirements.
Through the ECIP, eligible corporations are given a chance to regain their good standing and pay penalties at significantly lower rates until Nov. 30.
“With less than a month left before we officially close ECIP, we encourage non-compliant, suspended and revoked corporations to complete their applications to ensure the continuous operations of their businesses,” SEC chairperson Emilio Aquino said.
Aquino said that the submission of reportorial requirements is mandated by law and failure to comply could result in the suspension or revocation of corporate registrations.
Under the Revised Corporation Code of the Philippines, all SEC-registered corporations are required to submit their annual financial statements (AFS) and general information sheets (GIS).
Non-compliance can lead to the imposition of applicable fines and penalties.
In extreme cases, it also leads to the suspension or revocation of corporate registration, which strips a company of the powers and privileges granted to a registered corporation, including separate juridical personality, limited liability and perpetual existence, among others.
The SEC said that corporations that have incurred fines and penalties for the late or non-filing of their AFS or GIS, as well as noncompliance with MC No. 28, Series of 2020, which requires corporations to designate official and alternative contact details, may apply for ECIP.
Under the program, non-compliant corporations, including those under the delinquent status, will pay only P20,000 to settle their fines and penalties for the covered violations, while suspended or revoked corporations will only have to pay 50 percent of their total assessed penalties and a petition fee of P3,060 to lift their order of suspension or revocation.
However, the commission said that payment of the ECIP fees does not guarantee that corporations would automatically regain their good standing as eligible corporations will need to submit their latest due AFS and GIS as part of their application.
As for suspended or revoked firms, they will also have to submit their petition to lift the order of suspension or revocation, along with other supporting documents.
The SEC said that corporations which fail to avail of the ECIP would be subjected to the updated scale of fines and penalties that the commission implemented in April.
The new rates are around 900 to 1,900 percent higher compared to the previous rates that had been in place for more than two decades.