SEC to non-compliant, suspended firms: Avail amnesty program by Dec. 31

The Securities and Exchange Commission (SEC) on Tuesday called on non-compliant, suspended or revoked corporations to avail of its amnesty program before the year ends and start 2024 with a clean slate.

In a statement, the SEC said firms have less than two weeks to avail the corporate regulator’s amnesty program or until December 31, 2023, pursuant to SEC Memorandum Circular No. 20, Series of 2023.

The amnesty program, launched in March 2023, seeks to improve the compliance of companies with the SEC’s reportorial requirements by allowing non-compliant and suspended or revoked corporations to pay a reduced penalty for the late and non-filing of their general information sheets (GIS), annual financial statement (AFS), and official contact details.

The corporate regulator said, to avail of the amnesty, non-compliant corporations need to pay a fixed amnesty rate of P5,000, regardless of the number of reports and number of years they failed to submit their reports. 

Meanwhile, suspended and revoked corporations shall only pay 50% of their total assessed fines, on top of a P3,060 petition fee.

The SEC has released a list of 22,403 ordinary corporations that are in danger of having their certificates of incorporation revoked for their failure to submit their GIS within five years from the date of incorporation.

It added that a separate list covering 298,335 ordinary corporations that have failed to submit their GIS for three times consecutively or intermittently within five years has likewise been released.

“Such corporations are encouraged to avail of the amnesty program to avoid getting their corporate registrations revoked or getting tagged as delinquent. Availing of the amnesty will also allow them to continue enjoying the benefits and privileges of being a registered business in the Philippines,” the SEC said.

The agency said corporations availing of the amnesty need to answer a web-based expression of interest form on their SEC Electronic Filing and Submission Tool (eFAST) accounts and pay the amnesty fee. 

Suspended and revoked corporations will also need to pay the petition fee.

“After signifying their interest to avail of the amnesty, eligible corporations must submit their latest due GIS and AFS on eFAST,” the SEC said.

“Meanwhile, suspended and revoked corporations must also submit their petitions to lift their suspension or revocation, together with their GIS and AFS. Submissions of these requirements are all set on January 31, 2024,” it added.

The SEC, moreover, required suspended and revoked corporations to submit copies of their certificates of registration with the Bureau of Internal Revenue to the SEC Company Registration and Monitoring Department or the nearest SEC Extension Office through email by January 31, 2024.

The corporate regulator said that failure to avail of the amnesty will subject non-compliant and suspended or revoked corporations to a new scale of fines that will be implemented starting January 1, 2024.

In particular, domestic stock corporations with retained earnings of less than P100,000 and domestic non-stock corporations with a fund balance or equity of less than P100,000 will incur a basic penalty of P5,000 for the first offense for the late filing of their GIS or AFS, which will increase to P9,000 when the corporations reach the fifth offense. 

The SEC said it will also impose an additional P1,000 for every month of continuing violations.

For the non-filing of GIS or AFS, corporations will incur a basic penalty of P10,000 for the first offense, up to P18,000 for the fifth offense, plus P1,000 for the following month of continued violation.

The SEC noted that it will double the penalty for non-compliance with the requirement to designate official contact details from P10,000 to P20,000.

“The SEC will strictly enforce the submission of reportorial requirements and impose the corresponding monetary penalties, placement of corporations under delinquency status, and suspension and revocation of a corporation's certificate of incorporation in accordance with Republic Act No. 11232, or the Revised Corporation Code (RCC), once the new scale of fines are implemented,” it said. —VAL, GMA Integrated News