The Securities and Exchange Commission is seeking public comments on proposed rules governing market making, a practice intended to make it easier for investors to buy and sell securities while keeping trading orderly and transparent.
The SEC En Banc, at its meeting on August 13, 2026, approved the release of the draft Memorandum Circular on the Proposed SEC Rules on Market Making. The regulator issued the notice on August 14 and is accepting comments, suggestions, and other inputs from concerned parties until August 28.
In simple terms, a market maker helps keep a security tradable by regularly posting prices at which it is willing to buy and sell. This can improve liquidity, help investors discover prices, and support companies seeking to raise capital.
The proposed framework would cover market-making activities involving equity and fixed-income securities listed, traded, or enrolled on exchanges under the SEC’s jurisdiction. The rules recognize that stocks and bonds have different trading structures and would therefore impose separate operational and quoting requirements for each.
The SEC said the framework is intended to encourage legitimate market making while protecting investors and maintaining fair, efficient, and orderly markets.
That balance is important because securities laws prohibit fraudulent and manipulative practices, including transactions that create a false appearance of active trading or artificially influence prices. The proposed rules would provide clearer boundaries for legitimate market-making activities and help distinguish them from practices that could distort prices or mislead investors.
Market making is widely used internationally to improve liquidity and price discovery, potentially making markets more attractive to investors and issuers. More active trading can also make it easier for investors to enter or exit positions without significantly moving prices.
The proposed rules would apply to securities listed, traded, or enrolled on exchanges under SEC jurisdiction, but would not cover market making in government securities.
The consultation is part of the SEC’s broader effort to develop the Philippine capital market while strengthening investor confidence and preventing abusive trading practices.
The proposed framework seeks to make the market busier, but not at the expense of fairness. The idea is simple: more trading, better liquidity, and clearer guardrails.
