SEC Extends Amnesty Program for Non-Compliant Corporations
The Securities and Exchange Commission (SEC) has announced a final extension of its amnesty program for non-compliant corporations that have been suspended or revoked. In a statement, the SEC stated that it is offering delinquent corporations a last chance to take advantage of reduced fines and penalties by extending the amnesty application deadline until the end of 2023.
The SEC recently issued SEC Memorandum Circular No. 20, Series of 2023, which extends the deadline for corporations to file their amnesty application and settle the amnesty fees until December 31. This amnesty program aims to provide relief to corporations that have incurred penalties for the late and non-filing of their General Information Sheet (GIS), Annual Financial Statements (AFS), and official contact details, in accordance with the Revised Corporation Code (RCC).
Corporations can apply for amnesty by completing the web-based Expression of Interest form on their SEC Electronic Filing and Submission Tool (eFAST) accounts. All other requirements must be submitted by January 31, 2024, as long as the expression of interest has been filed before December 31.
Non-compliant corporations are also required to upload and submit their latest due GIS and AFS on eFAST before January 31, 2024. Suspended and revoked corporations must submit their respective petitions to lift their suspension or revocation on eFAST, along with their latest GIS and AFS, during the same period.
Suspended and revoked corporations must also submit additional requirements such as copies of their certificates of incorporation, latest mayor’s or business permits, and certificates of registration with the Bureau of Internal Revenue to the SEC Company Registration and Monitoring Department or the nearest SEC Extension Office by January 31, 2024, initially through email.
Failure to submit the complete set of requirements by January 31, 2024, will result in the forfeiture of the amnesty fee paid, as well as the petition fee initially collected from suspended or revoked corporations, in favor of the SEC.
Last month, the SEC released a list of 22,403 ordinary corporations that are at risk of having their certificates of incorporation revoked due to their failure to submit their GIS within five years from the date of incorporation. The Commission also listed 298,335 ordinary corporations that have failed to submit their GIS three times consecutively or intermittently within a five-year period.
These corporations are advised to participate in the amnesty program in order to avoid being labeled as delinquent or facing suspension or revocation of their corporate registrations.
To enforce compliance with reportorial requirements, the SEC has also released SEC Memorandum Circular No. 19, Series of 2023, which provides guidelines on the declaration of delinquent status and revocation of the certificate of registration of corporations under the RCC. On January 1, 2024, an updated scale of fines and penalties for reportorial requirements will be implemented, increasing basic penalties for late and non-filing of reports by as much as 1,900 percent.
Moving forward, the SEC will strictly enforce the submission of reportorial requirements by corporations and impose corresponding penalties, such as monetary fines, delinquency status, and suspension or revocation of the corporation’s certificate of incorporation, as mandated by the RCC.
Corporations seeking amnesty can visit the SEC Amnesty Microsite at amnesty.sec.gov.ph for step-by-step guidance on how to avail of the program.