MANILA, Philippines - Warning to corporations: you are not supposed to donate campaign funds to any candidate or party.
The Securities and Exchange Commission (SEC) has partnered with the Commission on Elections (Comelec) to monitor corporations to ensure they do not donate to any political party or candidate running in the May 2016 elections.
SEC spokesperson Arman Pan said the commission and the Comelec will formalize their partnership in a memorandum of agreement to be signed in the coming weeks.
Under the agreement, the Comelec will furnish the SEC all information on the expenditures of each candidate after the May 2016 elections. The SEC, in turn, will use the information to check whether or not there were corporate donors in the candidates’ lists of expenditures and political donations.
“Without the information, there’s no way for us to know,” Pan said.
Prior to this agreement, corporations have been asking the SEC on whether or not donations are allowed.
In a legal opinion, SEC General Counsel Camilo Correa reminded companies that “under Section 36 (9) of the Corporation Code of the Philippines, there is an absolute prohibition for corporations, both foreign and domestic from giving donations to any political party, candidate or for the purpose of any partisan political activity.”
The SEC earlier received a query on whether or not Section 95 of the Omnibus Election Code has repealed or amended Section 36 of the Corporation Code.
Section 95 of the Omnibus Election Code provides an enumeration of natural and juridical persons, including corporations who, because of benefits, privileges, licenses of franchise received from government, are prohibited from making contributions directly or indirectly for purposes of partisan political activation.
Correa said the SEC “is of the opinion that Section 95 of the Omnibus Election Code neither amended nor repealed, whether expressly or impliedly, Section 36 (9) of the Corporation Code.”
Thus, Section 95 of the Omnibus Election Code should be appreciated as an amplification of the absolute prohibition contained in the Corporation Code and is actually illustrative of some specific circumstances of the evil sought to be avoided by both the Corporation Code and the Omnibus Election Code.
The SEC also said that while the Corporation Code is a blanket prohibition over all corporations without regard to classification, the Omnibus Election Code is industry and activity specific, taking into consideration the amount of influence the prohibited entity can exercise over the government. The fines and penalties provided also differ for the two laws.
“Be that as it may, these differences do not clash with each other to the point that one is a bar to enforcement and effectivity of the other. If anything, the presence of these two laws especially as they affect corporations, serves as a more effective deterrent for corporations planning to make contributions for partisan political activities,” the SEC said.