SEC boosts capital market with strict timelines, discounts for offerings until yearend

The Securities and Exchange Commission (SEC) continues its efforts to attract more players into the capital market by enforcing strict timelines and giving discounts to companies that will conduct public offerings until the end of the year.

The Commission on July 24 issued Memorandum Circular No. 9, Series of 2025, titled Further Streamlining the 45-Day Registration Statement Review Process under the Markets and Securities Regulation Department (MSRD) of the SEC, and Providing for a Discounted Rate for the Registration Fee.

The guidelines further streamline the evaluation and approval process for registration statements by, among others, integrating clearance processes across departments of the Commission in the 45-day processing timeline provided under Republic Act No. 8799, or the Securities Regulation Code.

It also provides a 30% discount on the assessed registration fees of all registration statement applications until December 31, 2025.

“Our goal for the Philippine capital market is clear—increase market participation to bring it up to par with our peers in the Southeast Asian region,” SEC Chairperson Francis Lim said.

“The SEC will streamline processes and provide discounts or incentives where possible, in order to encourage more businesses to tap the capital market, enabling them to unlock their full growth potential through diverse financing options,” he added.

Pre-processing and clearances

The guidelines cover all registration statement applications by companies seeking to conduct initial public offerings or follow-on offerings, as well as those issuing investment contracts, certificates of participation, profit-sharing agreements, bonds, and debt securities, as well as other forms of securities being registered by power generation companies and distribution utility companies and real estate developers and/or managers in relation to rental pool arrangements.

Agri-business corporations and hospitals, which are subject to a 28-day processing period, are excluded from the 45-day review timeline.

To start its registration statement application, a company must send digital copies of the necessary documents, including the company’s prospectus, to the MSRD via email for pre-processing review. The MSRD shall then present the company’s financial statements to the SEC Office of the General Accountant (OGA) to determine basic compliance with SRC Revised Rule 68.

Should the MSRD find that the documentary requirements submitted are complete and sufficient on their face, the company will be asked to pay the first tranche of the total registration fee, equivalent to 20 percent of the total registration fee, and the corresponding fees for requests for clearances from other operating departments of the SEC.

The requests for clearances include the request for a Certificate of Good Standing and/or Certificate of No Derogatory Information from the SEC Company Registration and Monitoring Department and a certificate of no pending case from the Office of the General Counsel.

Also included in the list of clearances are: a certificate of qualification and non-disqualification of independent directors and website template, as may be applicable, from the Corporate Governance and Finance Department and a certificate of no pending case from the Enforcement and Investor Protection Department.

Strict 45-day review process

The 45-calendar day period shall be reckoned from the date of submission to the MSRD of proof of payment of the first tranche of the registration fee and the full payment of fees pertaining to the clearances.

Upon receipt of the application and proof of payment of registration fees and other charges, the MSRD shall take charge of requesting the aforementioned clearances from the respective operating departments, which will, in turn, process all such requests within three working days.

Should one of the departments have issues or findings with respect to the request for clearance, the applicant shall be required to address such deficiencies within five calendar days. The compliance period shall be included within the 45-day review timeframe.

Simultaneously, the OGA will conduct a detailed review of the applicant’s financial statements within 30 days, which shall also be completed within the 45-day period.

Meanwhile, notwithstanding the pendency of the clearances from other operating departments, the MSRD shall issue a comment letter outlining its own findings, issues, and deficiencies identified in the documents submitted within 15 calendar days upon its receipt of the application. The applicant shall then have 20 calendar days to address the comments.

Failure of the applicant to comply with the directives of the MSRD within the 20-day period shall be sufficient ground for the denial of the application and for the forfeiture of the first tranche of registration fee and certification fees, without prejudice to the re-filing of such application.

The applicant’s failure to comply with comments by an operating department may also be considered in denying the application.

The MSRD shall then issue a fee assessment for the remaining 80% of the registration fees for the application not later than the 45th day and prior to the presentation of the application before the Commission En Banc.

On or before the 45th day, the MSRD shall present the application before the Commission En Banc. Should it be favorably considered, the MSRD shall issue a pre-effective letter stating the conditions to be complied with.

Upon compliance with the requirements, the MSRD shall issue the Order of Registration and/or Permit to Sell Securities to the Public.