The Securities and Exchange Commission (SEC) threatened to revoke the licenses of more than 11,000 companies over their alleged non-compliance with repertorial requirements.
The SEC, in a notice dated Dec. 13, 2024, said 11,677 corporations were subjected to evaluation for the possible suspension of their certificates of incorporation for their failure to submit their annual financial statements (AFS) and general information sheets (GIS) in the last eight reporting years, or from 2015 to 2022.
It said to avoid paying higher penalties, the companies should apply for the enhanced compliance incentive plan (ECIP) before the end-December 2024 deadline.
All registered corporations are required to submit to the SEC their AFS and GIS annually and other reports under Section 117 of the Republic Act No. 11232 or the Revised Corporation Code of the Philippines (RCC).
Under the RCC, the SEC may put a corporation under a “delinquent” status if it fails to submit reportorial requirements three times, either consecutively or intermittently, within a five-year period.
Delinquent corporations have two years to resume their operations, or their registration will be revoked.
The SEC also has the power to suspend or revoke, after proper notice and hearing, the franchise or certificate of registration of corporations upon any of the grounds provided by law.
Under the ECIP, non-compliant corporations and those placed under the delinquent status will only have to pay P20,000 to settle their fines and penalties.
Suspended/revoked corporations, meanwhile, should pay 50 percent of their assessed fines and penalties, and a P3,060 petition fee to lift their order of suspension or revocation.
To apply for ECIP, eligible corporations will have to submit their expression of interest using their company accounts on the Electronic Filing and Submission Tool (eFAST).
They should also submit their latest due AFS and GIS before Dec. 31, 2024 to complete their ECIP application. Suspended/revoked corporations should also submit other supporting documents to the designated email addresses of SEC extension offices that cover their jurisdiction.
