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SEC chair: More registered firms plus proposed changes to Corporation Code this year
By EARL VICTOR L. ROSERO, GMA News
As the Securities and Exchange Commission opened its Philippine Business Registry service desk and computerized kiosk, its Chairperson Teresita Herbosa revealed that the Corporation Code is about to get an upgrade after 32 years and the number of new firms is expected to go up significantly this year.
Since Monday morning, newly-registered corporations and partnerships were spared the trouble of getting their employer's number from the Social Security System, PhilHealth and Home Development Mutual Fund (HDMF or Pag-IBIG Fund).
These numbers can be now be had for free from either the PBR service desk or the computerized kiosk located at the SEC head office along EDSA near the Ortigas flyover. By agreement with the Bureau of Internal Revenue, the taxpayer identification number (TIN) is issued together with the new SEC registration papers.
From the moment the approved incorporation or partnership documents are issued, the new partnership or corporation would get its identification numbers in less than an hour. There is a teller at the service desk where a computer terminal is linked via the Internet to the SSS, PhilHealth and Pag-IBIG.
“Our main business is to spur business by making it easy to register,” said Herbosa, who disclosed that she wants the SEC to immediately acquire seven new PBR terminals for deployment to field offices. The pilot computerized kiosk cost P250,000, according to DTI officials.
The Philippine Business Registry (PBR) project of the Department of Trade and Industry and the Securities and Exchange Commission now has this computerized kiosk and a teller-assisted service desk at the head offices of the Securities and Exchange Commission where newly-registered corporations and partnerships can quickly get their SSS, PhilHealth and Pag-IBIG employers' numbers. Earl Victor Rosero
“The savings may be from 3 to 5 days to 30 minutes...Hindi original ito sa akin...kay Lilia de Lima of PEZA. There is no red tape, just red carpet treatment,” said Secretary Gregory Domingo of the Department of Trade and Industry, lead proponent of the PBR.
Domingo said they want to deploy a few hundred of the PBR terminals and kiosks to the field offices of DTI, SEC and other partner agencies. The contractor-developer is a firm named Acuity.
“This was originally started 2006...but when we assumed in July 2010 when I checked where it was, there was really very little progress, so we immediately embarked on pushing this and I thought it would be done in six months, but it took much longer because it is a very complicated system because we have to have real time access to the computers of five different agencies.”
Domingo said they aim to have electronic payments and online transactions as soon as systems are ready. “We're hoping that it will be sometime middle of this year.”
Continuing rise in business activity
Herbosa revealed that since after the last financial crisis in 2008, there has been a continuing increase in the number of registered firms and corporate finance activity—judging by the SEC's higher collections in fees last year.
The SEC chairperson said they had expected to collect only about P800 million but actually earned P1.4 billion.
“You know 85 to 90 percent of our revenue collections are actually fees, meaning that businesses are registering and they are paying the fees,” Herbosa said.
“2012 ang feeling ko talagang even with respect to the IPOs and listings with the stock exchange, we will probably have more than last year,” the SEC chairperson said.
Amending the Corporation Code
Crunched data on how many firms the SEC regulates are not readily available online because the SEC computerization is still ongoing.
Chairperson Herbosa could only give a rough estimate. Of about 750,000 registrations since 1939, Herbosa said half are not active while “the rest are complying somehow” and the list includes firms that have not been regularly filing reports or have status issues.
Herbosa said registered firms are being reminded via announcement on the SEC website to extend their corporate life or renew the license from the SEC.
“We're thinking of another way instead of just 50 years, either we make it shorter or make it perpetual but with certain periodic renewals, or we could make it shorter at 25 nang hindi namamatay ang lahat ng incorporator bago mag-end,” she told reporters.
Some firms, she said either don't take seriously the SEC requirements, simply forget or some officials have already died.
“Imagine mababasa mo sa diyaryo, “Celebrating our 50th anniversary tapos yung corporate term nila ay expired...(dahil) yung corporate secretary pala forgot to extend their corporate term. Mostly ang nangyayari, patay na 'yung incorporators.” Herbosa said.
Before the year ends, she said the SEC would be done with its proposals to revise the Corporation Code which became law back in May 1980. “It's time na talaga to amend the Corporation Code.” Foreign ownership, nationality requirements
“We also want to be clearer about the nationality requirements...to reinforce our authority to determine if the company is complying with the nationality requirements,” Herbosa added.
The SEC had asserted that authority in a position paper submitted to the Supreme Court through the Office of the Solicitor General in the pending foreign ownership and control case involving the Philippine Long Distance Telephone Company. Herbosa said oral arguments are expected sometime April.
The petitioner in the case, Wilson Gamboa, died last year. Herbosa said another party may be taking up the case even after Gamboa's passing.
Meanwhile, PLDT disclosed that it set a special stockholders' meeting on March 22 “for the purpose of seeking approval of the amendments to the Seventh Article of the Articles of Incorporation, consisting of the sub-classification of the company’s preferred capital stock into 150,000,000 shares of voting preferred stock, each with a par value of P1, and 807,500,000 shares of non-voting serial preferred stock, each with a value of P10.”
The amendments were formulated after the high court ruled last June that PLDT violated the foreign ownership and control limit of 40 percent in the 1987 Constitution. "(F)oreigners hold 64.27 percent of the total number of PLDT common shares while the Filipinos hold only 35.73 percent. Such amount of control unmistakably exceeds the allowable 40 percent limit on foreign ownership of public utilities expressly mandated in Section 11, Article XII of the Constitution," the Supreme Court said.
In response, PLDT, througha 50-page motion for reconsideration filed last July 15, PLDT chairman Manuel V. Pangilinan warned the Supreme Court of the dire consequences of its redefinition of the term “capital" found in Section 11, Article XII of the 1987 Constitution.
“If the Court does not reconsider, that unwarranted redefinition will have very serious adverse repercussions for the partially nationalized industries affected, the Philippine capital market, the Philippine economy in general and the country as a whole. There will be no telling if and how those severe consequences can be survived," said Pangilinan. For its part, the Philippine Stock Exchange (PSE) wants the definition of "capital" aligned with global finance terminology should the Supreme Court change its June 28 ruling on foreign ownership limits in the PLDT case. “We’re hoping that there will be a lot more logic that goes into the discussion... It is quite dangerous for the Court, with the stroke of a pen, to define the word ‘capital’," PSE president Hans B. Sicat has said. — ELR, GMA News
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