The howl raised by the various business and trade organizations over significantly higher fees and charges at the Securities and Exchange Commission has forced the watchdog agency to schedule a roundtable discussion with its constituents.
Such big-name groups as the Philippine Chamber of Commerce and Industry, the Federation of Filipino Chinese Chambers of Commerce and Industry, the Philippine Exporters Confederation Inc., Employers Confederation of the Philippines, Management Association of the Philippines, Chamber of Thrift Banks, Philippine Retailers Association, Philippine Franchise Association, Philippine Association of Legitimate Service Contractors, Stratbase ADR Institute for Strategic and International Studies and Philippine Food Processors and Exporters Organization Inc. all oppose the inflated schedule of fees and charges levied against any of their member companies.
The updated fines and penalties apply beginning 7 November this year in adjustments as high as 1,900 percent.
“The commission is committed to hearing all comments and suggestions from its stakeholders before issuing the new and final schedule of fees for its services. In the same manner, the commission has always been committed to transparent and accurate data in the interest of fairness to all concerned,” the SEC said in a statement.
It meets the horde of recalcitrant corporate transgressors Thursday, October 12, to thresh out their collective displeasure over charges meant to ensure compliance to regulations as innocent as the submission of so-called reportorial documents.
Quite a number of businesses are known to take the punitive charges in stride given the puny scale of penalties and charges the SEC imposes on non-compliant constituents.
The SEC said the fees and charges schedule was last updated in 2017 based on proposals from 2014. This means the current rates are based on operational and administrative costs prevailing some 10 years earlier.
Since then the agency has launched digital systems such as the SEC Application Program Interface and the Electronic SEC Education, Analysis, Research Computing Hub (eSEARCH) to help it monitor corporate compliance.
“In fixing the fees and charges applicable to IT-related services, the SEC ensured the rates are sufficient to cover the cost of services rendered. The commission considered the direct costs of rendering the service; the inflation from the year of imposition or last revision of the fees; and the value of the manpower resources used, the technology adopted, and the equipment required in rendering the services,” it said.
The increase also account for historical and projected volume of transaction and data requests to ensure the collections are sufficient to recover the rising operating and maintenance costs of the digital services.
Further, the fees and charges were benchmarked with those imposed on similar services in the Philippines and in other jurisdictions.
For instance, Singapore’s Accounting and Corporate Regulatory Authority charges P3,029.70 for the download of financial statements and Corporate Compliance and Financial Profile. This is equivalent to the company snapshot package, consisting of the General Information Sheet, Annual Financial Statements, and company snapshot, worth P1,000 that may be downloaded from eSEARCH.
Under the proposed rates, domestic stock corporations with retained earnings of not more than P100,000 will incur a basic penalty of P5,000 for the late filing of their general information sheet or annual financial statement, plus P1,000 for every month of continuing violation. This represents a 900 percent increase from the current rate of P500.
The same penalty applies to domestic non-stock corporations with a fund balance or equity of not more than P100,000, a 19 times jump from the current penalty of P250.
Non-filing of the general information sheet (GIS) or annual financial statement (AFS) by domestic stock and non-stock corporations with retained earnings and fund balance/equity, respectively, of not more than P100,000 are slapped with a basic penalty of P10,000, plus P1,000 per month of continuing violation.
The penalty for non-compliance with Memorandum Circular 28 are set at P20,000, double the current rate of P10,000.
