MANILA, Philippines - The Securities and Exchange Commission (SEC) asked yesterday CEOs and chief financial officers, as well as internal and external auditors, to ensure that no corporate funds would be released for next year’s elections.
The Corporation Code of the Philippines prohibits corporations, domestic or foreign, from giving donations in aid of any political party or candidate or for purposes of partisan political activity, SEC Chairman Teresita Herbosa said.
The Omnibus Election Code also enumerates juridical entities disqualified from making political contributions: public or private financial institutions, operators of public utility, contractors or subcontractors supplying the government with goods or services, educational institutions as well as civil officials and employees and members of the Armed Forces.
The SEC will look into the financial statement of companies to check whether they had donated funds for political campaigns, Herbosa said.
“I’m also counting on all the other officers of the company,” she said.
“We have the finance officer and external and internal auditors. If it’s a big amount, it will show in some corporate records.”
Even if a shareholder owns 90 percent of a corporation, he or she cannot use the company’s money to contribute to a politician, Herbosa said.
“We are here to remind companies of the provision in the Corporation Code and the officers should see to it that company money must not be used,” she said.
The SEC and the Commission on Elections (Comelec) signed yesterday an agreement to strengthen the ban on corporations from contributing to political campaigns.
The Comelec and the SEC will share information to easily identify SEC-registered corporations making illegal campaign contributions, Chairman Andres Bautista said.
“Under the MOA, the Comelec will provide the SEC with information on corporations and other SEC-registered entities that have engaged in partisan political activities,” he said. “It is a prohibited act under the Corporation Code of the Philippines.”
The information from the Comelec could be the “trigger” that the SEC needs to go after violating corporations, Herbosa said.
“That’s a signal for us to do some investigation,” she said.
“How we will go about that? Precisely, we have this MOA. We can request from the Comelec any document that a candidate may have filed that would give or show a list of his donors or contributors.”
Election laws also states that it shall be unlawful for any person to solicit or receive any contribution from any of the identified persons or entities.
However, the Corporation Code does not prohibit an individual, even if he is associated with a corporation, from contributing to a candidate’s campaign machinery, Herbosa said.
“We cannot do anything about that unless there’s somebody who could come out and say the one who really contributed is this person,” she said. “As far as the corporation is concerned, maybe we can look at their financial statement.”
Among the agreement’s salient provisions is the Comelec’s undertaking to furnish the SEC with information on names of corporations or other SEC-registered entities engaged in partisan political activity.
The Comelec will also provide the SEC information on the campaign finance submissions of candidates and parties, as well as in advertising contracts furnished to Comelec by mass media entities, within 30 days from receipt of the disclosure report, starting from the 2016 national and local elections.
Other information include a list of corporations or other SEC-registered entities that filed petitions with the Comelec to register as a political party, register as a party-list organization with intent to participate in the elections, or manifest their intent to participate in the elections.
The SEC has committed to provide the Comelec with a list of names of corporations or other SEC-registered entities that are grantees of primary franchisees and/or secondary licenses or permits.
They also agreed to share information should they reciprocally discover violations of other laws.
The agreement will take effect in time for next year’s elections.