Amendments to the Rules Fixing the Amount of Paid-Up Capital Stock of Stockbrokers/Dealers and Their Surety Bonds

September 15, 1987 SEC-BED * MEMORANDUM CIRCULAR NO. 13-87 TO : All Concerned SUBJECT : Amendments to the Rules Fixing the Amount of Paid-Up Capital Stock of Stockbrokers/Dealers and their Surety Bonds For your information and compliance, hereunder quoted are the amendments to subject Rules, the rest of the provisions thereof remain unrevised: LexLib "1. Henceforth every person applying for a license to act as stock broker/dealer must have a paid-up capital of at least THREE MILLION (P3,000,000.00) PESOS. Brokers and dealers who are currently registered or licensed as such but whose paid-up capital are less than P3,000,000.00 may be allowed to continue to operate provided that said paid-up capital shall on or before December 31, 1987 be increased to P2,000,000.00 and on or before June 30, 1988 be increased to P3,000,000.00. All required paid-up capital in cash or property herein treated shall at all times be kept unimpaired. The SEC shall pass upon the acceptability of properties contributed as part of paid-up capital. In no case however shall properties not related to the brokerage business be allowed as paid-up capital." (SGD.) JULIO A. SULIT, JR. Chairman REVISED RULES FIXING THE AMOUNT OF PAID-UP CAPITAL OF STOCK BROKERS/DEALERS AND THEIR SURETY BONDS For better protection of investors, the Securities and Exchange Commission, by virtue of the powers in it vested by law, hereby promulgates the following revised rules: 1. Henceforth, every person applying for a license to act as stock broker/dealer must have a paid-up capital of at least Three Million (P3,000,000.00) Pesos. Brokers and dealers who are currently registered or licensed is such but whose paid-up capital are less than P3,000,000.00 may be allowed to continue to operate provided that said paid-up capital shall on or before December 31, 1987 be increased to P2,000,000.00 and on or before 30 June 1988 be increased to P3,000,000.00. All required paid-up capital in cash or property herein treated shall at all times be kept unimpaired. The SEC shall pass upon the acceptability of properties contributed as part of paid-up capital. In no case however shall properties not related to the brokerage business be allowed as paid-up capital. 2. The amount of surety bonds required to be filed pursuant to Section 19 of the Revised Securities Act by stock brokers and dealers is fixed at not less than TWO HUNDRED THOUSAND (P200,000.00) PESOS for brokers and not less than ONE HUNDRED THOUSAND (P100,000.00) PESOS for dealers. Such bond or bonds shall be in favor of the Government of the Republic of the Philippines, and conditioned upon the faithful compliance with the provisions of the Revised Securities Act and its implementing rules and regulations by said brokers and dealers and by all the salesmen while acting for them. 3. No corporation shall be allowed to operate a seat in any exchange unless all the stockholders thereof, which in no case shall be more than ten (10), are acceptable to the Board of Governors of such exchange and which act must be so certified by the said Board to the Securities and Exchange Commission. 4. Member-firms in any stock exchange shall engage solely and exclusively in the stock and bond brokerage business and in activities directly or indirectly connected therewith or incidental thereto. 5. These rules shall take effect fifteen (15) days after they have been publicly promulgated by publication in at least two newspapers of general circulation throughout the Philippines, and in the official Gazette. 6. Any violation of these rules shall be punished by a fine of not exceeding two hundred pesos, and if the violation continues, an additional fine of not exceeding two hundred pesos per day for every day of delay. If the violation is committed by a broker and/or dealer, the Commission, in serious cases, may suspend or revoke his license, in addition to the foregoing fine. llcd (SGD.) JULIO A. SULIT, JR. Chairman