SEC wants energy firms, hospitals to tap capital market

To fuel expansion, growth

MANILA, Philippines — The Securities and Exchange Commission (SEC) plans to encourage more energy companies and hospitals to tap the capital market as a source of financing to fuel their expansion and business growth.

Oliver Leonardo, SEC markets and securities regulations department director, told The STAR that the commission has set its sights next on bringing the capital market closer to energy companies and hospitals, two industries essential to the country’s growth, following the recent conclusion of the commission’s nationwide roadshow for micro, small and medium enterprises (MSMEs).

“We’re set to do promotions but this time, focused on power generation and distribution companies that will have to offer their securities to the public under the EPIRA,” Leonardo said.

“We’re currently in discussions with ERC for these events moving forward,” he said.

Last year, the SEC streamlined the registration process for capital raising of power generation companies and distribution utilities, in support of the public offering mandate stipulated in the Electric Power Industry Reform Act (EPIRA) of 2001.

The commission issued a memorandum circular adopting the guidelines for a simplified registration for power generation firms and distribution utilities seeking fresh funds through the public offering of securities.

Through the Securing and Expanding Capital for Power Generation Operators and Wholesale Electricity and Retail Services, the registration of securities for power generation companies and distribution utilities that are mandated to offer and sell at least 15 percent of their shares to the public, pursuant to EPIRA, has been simplified.

Together, the SEC and ERC have been exploring avenues of collaboration in order to streamline regulatory processes and create a joint framework for the public offering requirement mandated by EPIRA.

Aside from energy firms, the SEC is also eyeing to encourage hospitals to turn to the capital market for their capital needs.

“We’ll do focused activities to rally our stakeholders there,” Leonardo said.

“The aim of course is for our stakeholders to tap the capital market to raise funds via that route,” he said.

The SEC recently concluded its two-year nationwide roadshow for MSMEs, successfully pitching the capital market as a source of financing and generating over P2 billion in fresh funds for small businesses.

The nationwide roadshow introduced the capital market as an accessible option for MSMEs to finance their operations and promote expansion through crowdfunding and initial public offering, among others.

“As overseer and regulator of the corporate sector and the capital market, we aim to create opportunities for businesses to realize their growth potential by availing themselves of the limitless benefits of turning to the capital market for their capital needs,” SEC chairperson Emilio Aquino said.