Policies, Guidelines and Procedures in the Processing of Request for Corporate Information, Including Beneficial Ownership Information, with the Securities and Exchange Commission

July 18, 2023 REVENUE MEMORANDUM ORDER NO. 26-2023 TO : All Internal Revenue Officers, Officials and Others Concerned SUBJECT : Policies, Guidelines and Procedures in the Processing of Request for Corporate Information, Including Beneficial Ownership Information, with the Securities and Exchange Commission I. BACKGROUND On February 28, 2023, the Bureau of Internal Revenue (BIR) and the Securities and Exchange Commission (SEC) entered into a Data Sharing Agreement (DSA) pursuant to Republic Act (RA) No. 10173 or the Data Privacy Act of 2012, as implemented by NPC Circular 16-02 dated October 10, 2016. The DSA enhances and streamlines the access of the BIR to corporate information, including beneficial ownership information, by allowing on-site and online access, as well as off-site access, to relevant reportorial documents submitted by all corporations to the SEC. HTcADC A beneficial owner of a corporation is the natural person who ultimately owns or controls the corporation or exercises ultimate effective control over the corporation. 1 Disclosing beneficial ownership information is required to prevent the use of corporations for money laundering, terrorist financing, tax evasion and other illicit activities, among other purposes. Tax evasion and money laundering commonly create secrecy by layering of ownership through opaque legal structures or other legal vehicles to conceal the true ownership of activities and assets. II. OBJECTIVES Under the National Internal Revenue Code (Tax Code), as amended, the powers and duties of the BIR include, among others, the assessment and collection of all national internal revenue taxes, fees and charges, and the enforcement of all forfeitures, penalties and fines connected therewith. The Tax Code authorizes the Commissioner, among others, to obtain relevant information from any office or officer of the national and local governments, government agencies and instrumentalities, like SEC, and to examine any book, paper, record, or other data which may be relevant or material to such inquiry, in determining the liability of any person for any internal revenue tax, or in collecting any such liability, or in evaluating tax compliance. In case of corporations, partnerships or associations, compulsory production of taxpayer's records may be done through the issuance of subpoena duces tecum (SDT) to the partner, president, general manager, branch manager, treasurer, registered officer-in-charge, employee/s or other persons responsible for the custody of the books of accounts and other accounting records mandated to be submitted or information mandated to be provided. Similarly, in holding such entities liable for any violation of the Tax Code, the BIR may institute criminal proceedings against certain corporate officers, including the partner, president, general manager, branch manager, treasurer, officer-in-charge, and the employees responsible for the violation. CAIHTE Specifically, by having access to beneficial ownership, the BIR will be able to know the true ownership of activities and assets and, thus, allow fair taxation and just enforcement of tax laws. Availability of beneficial ownership for tax purposes also complies with the international tax transparency standards set by the OECD Global Forum on Transparency and Exchange of Information for Tax Purposes or the Global Forum where the Philippines is a member. In enforcing these statutory powers and objectives, the BIR will need corporate information, including beneficial ownership information, and documents in the possession or custody of the SEC. Hence, the need for a more organized, coordinated and streamlined access to such documents and information so that they can be fully utilized and maximized and their confidentiality maintained, protected and secured. This Revenue Memorandum Order (RMO) is, therefore, issued to prescribe the guidelines and procedures to be followed by BIR officials and employees when requesting for corporate information from the SEC and to clarify the respective roles and responsibilities of the BIR officials and employees involved in the implementation of the DSA. III. INFORMATION THAT MAY BE REQUESTED The DSA allows the BIR to obtain information on corporations and other registered/licensed entities, including beneficial ownership information. In particular, the following information may be requested from the SEC: a. complete name of incorporators, stockholders, directors, trustees, members, officers of a SEC-registered corporation, including their specific residential address, date of birth, nationality, taxpayer identification number (TIN), and percentage of ownership; b. beneficial owners of SEC-registered corporations; c. partners in a partnership; and d. information on other persons licensed by the SEC. IV. DATA PROTECTION OFFICER For the purpose of implementing the mandates of the DSA, the Deputy Commissioner for Information Systems Group, the duly designated Data Protection Officer (DPO) of the BIR, shall be acting through the Chief of the International Tax Affairs Division (ITAD), as her alternate DPO. aScITE V. INITIATING REQUEST FOR INFORMATION The BIR shall develop a web-based application for the purpose of receiving requests for corporate information from BIR offices, and storing, transmitting, and accessing the information and documents provided by the SEC. While the said web-based application is not yet in place, the requesting office shall send its request for assistance to the official email address created for this purpose, i.e. , [emailprotected] . All requests for corporate information shall be addressed to the DPO, for the attention of the alternate DPO, and coursed through the ITAD. The letter shall follow the prescribed format (Annex A) . In turn, the alternate DPO shall assign a reference number, which will be used to track the said request, and thoroughly evaluate if said request is sufficient in form and in substance. If found to be complete and in order, he/she shall prepare a letter-request addressed to the SEC. This letter-request shall follow the prescribed format (Annex B) and shall likewise be sent to the SEC using the same email facility. The official email address shall be managed exclusively by the alternate DPO and any other person authorized to act as such pursuant to a Revenue Delegation Authority Order. It shall not only be used when sending requests to the SEC but also when receiving information/documents from the said government agency and transmitting the same to the requesting office. VI. PROCESSING OF REQUEST, METHOD OF DISCLOSURE, TRANSFER All personal data obtained pursuant to this DSA shall be used, processed, disclosed and transferred following the policies and guidelines for personal data protection and security prescribed under RMO No. 1-2020 or the Data Privacy Manual of the BIR, in compliance with the Data Privacy Act of 2012 and its implementing rules and regulations. Files and documents containing personal data shall be encrypted and transferred preferably via a secure email facility or via the cloud storage associated with the official email address. Access to the uploaded files shall only be given to the head of the requesting office and any other person authorized by the head of office and whose name has been indicated in the request-letter. Other revenue employees shall only be given access to the uploaded files upon receipt by the alternate DPO of an authorization letter duly signed by the head of the requesting office. Personal data stored in paper files or any physical media shall be transmitted only through registered mail or, where appropriate, authorized parcel post service. As much as possible, facsimile technology shall not be used in transmitting documents containing personal data. DETACa VII. CONFIDENTIALITY The data sharing between the BIR and the SEC shall be carried out in accordance with the provisions of the relevant DSA. Any information obtained pursuant to this DSA shall be treated with utmost confidentiality pursuant to the Data Privacy Act of 2012 and Section 270 of the Tax Code and shall be used only for the purpose or purposes stated in the letter-request in accordance with the objectives set forth in item II hereof. VIII. REPEALING CLAUSE Other pertinent revenues issuances or portions thereof that are inconsistent herewith are hereby repealed, amended or modified accordingly. IX. EFFECTIVITY This RMO shall take effect immediately. (SGD.) ROMEO D. LUMAGUI, JR. Commissioner of Internal Revenue ANNEX A REPUBLIC OF THE PHILIPPINES DEPARTMENT OF FINANCE BUREAU OF INTERNAL REVENUE [Date] [Name] Data Protection Officer Bureau of Internal Revenue Room 409, BIR National Office Building BIR Road, Diliman 1100 Quezon City Thru: [Name] Alternate Data Protection Officer Dear Deputy Commissioner ____________: In accordance with the Data Sharing Agreement between the Bureau of Internal Revenue (BIR) and the Securities and Exchange Commission (SEC), I respectfully request that the following information/documents concerning the taxpayer(s) identified below be obtained from the SEC: HTcADC Documents: 1. Articles of Incorporation; 2. Amended Articles of Incorporation; 3. Latest General Information Sheet; and 4. Beneficial Ownership Disclosure Page. Subject(s): 1. ABC Corporation [Registration Number, if available] 2. Juan E. Dela Cruz [TIN/Passport No., if known] Purpose(s): ________________________________________________________ ___________________________________________________________________ ___________________________________________________________________ ___________________________________________________________________ Person(s) to be given access to the information: 1. We would greatly appreciate it if we could be furnished these pieces of information within ______ days from receipt hereof. Very truly yours, [Head of Office] ANNEX B REPUBLIC OF THE PHILIPPINES DEPARTMENT OF FINANCE BUREAU OF INTERNAL REVENUE Reference No.: BIR-BO-xx-xxxx [Date] [Name] Chairperson Securities and Exchange Commission The SEC Headquarters, 7907 Makati Ave., Salcedo Village, Brgy. Bel-Air, Makati City Thru: [Name] Director Enforcement and Investor Protection Department Dear Chairperson ____________: In connection with Article II of the Data Sharing Agreement (DSA) between the Bureau of Internal Revenue (BIR) and the Securities and Exchange Commission (SEC), I respectfully request the following information/documents on the subject(s) as enumerated below: CAIHTE Documents: 1. Articles of Incorporation; 2. Amended Articles of Incorporation; 3. Latest General Information Sheet; and 4. Beneficial Ownership Disclosure Page. Subject(s): 1. ABC Corporation [Registration Number, if available] 2. Juan E. Dela Cruz [TIN/Passport No., if known] This request is made for the purpose of __________________________________. We would greatly appreciate it if we could be furnished these pieces of information within _____ days from receipt hereof. Very truly yours, [Data Protection Officer (DPO) or Alternate DPO] Footnotes 1. SEC Memorandum Circular No. 17, Series of 2018.