SEC seeks legislative amendment to Securities Regulation Code

Securities and Exchange Commission (SEC) chairperson Teresita Herbosa is urging lawmakers to amend the Securities Regulations Code (SRC) for the Philippines to gain full membership status in the global association of SECs.

"The SEC is constrained to resort to the only option left: Propose to the Philippine Congress soonest the relevant amendments to the SRC such that the SEC would be empowered as required under the MMOU (Multilateral Memorandum of Understanding)," Herbosa said in her remarks during the 49th Financial Executives Institute of the Philippines conference in Makati City on Friday.

While the Philippines is an member of International Organization of Securities Commissions (IOSCO),  it cannot enjoy the benefits of full membership because of the bank secrecy law that bars the country from signing on to the MMOU—an information sharing agreement.

IOSCO, which sets global standards in securities regulations, is composed of nearly all securities regulators worldwide.

"The SEC had attempted twice to sign the MMOU by virtue of the AMLA (Anti-Money Laundering Act). However, in both instances these were denied by IOSCO," Herbosa noted.

As a repeal of the bank secrecy law would "shock" some people, she said the SEC was compelled to propose amendments to the SRC or Republic Act No. 8799.

The SEC is proposing to allow the corporate regulator access to bank records, documents and other relevant information, and summon persons to investigations into alleged violations of the securities code.

Herbosa said the implementation and enforcement of a revised SRC will result in the following advantages to the Philippines:

• Better investor protection

• Timely detection and prevention of scams

• Effective and efficient investigations into violations of securities law

• Faster repatriation of assets illegally transferred abroad

• Enhanced economic development

• Robust and liquid capital market

• Greater participation in regional cross border financial incentives Better financial services (money transfers of OFWs and international financial flows)

"Should these proposed amendments remain pending, however, not only will the Philippines not become signatory to the MMOU ... it cannot take part in the ASEAN integrations initiatives, particularly those concerning the capital markets and cross border transactions involving the sale of securities and foreign direct investments," Herbosa said. — VDS, GMA News