Anscor Finance Corporation

May 24, 1983 Anscor Finance Corporation 5th Flr., Philcox Building 172 Salcedo St., Legaspi Vill. Makati, Metro Manila Gentlemen: This has reference to your letter dated February 16, 1983, wherein you contended that you should not be penalized for P560.00 in connection with the late filing of your application for renewal of your certificate of authority to operate as a financing company for the following reasons: 1. The amendment (promulgated by the SEC on July 28, 1978) to the Basic Rules and Regulations to Implement the Provisions of Republic Act No. 5 98 0 (the Financing Company A c t ) which added Section 2 (c) requiring the annual renewal of the certificate of authority and the filing of the application not later than 45 days before the expiry date of the certificate of authority, has not readily taken effect and therefore, it is not legally enforceable in view of non-compliance with the provisions of Presidential Decree No. 1603, promulgated on June 11, 1978. Said decree requires that rules and regulations promulgated by a ministry, bureau or office of the Government shall be subject to approval by the President of the Philippines and shall take effect only upon such approval and that rules and regulations which do not involve merely matters of internal administration but necessary for the effective implementation of essential government policies as certified by the President shall take effect fifteen (15) days after their publication in the Official Gazette. 2. The original certificate of authority does not contain any indication that it has to be renewed annually as it does not contain an expiry date; neither does it state anything about any requirement of its renewal annually. 3. You were not furnished by the SEC the aforementioned requirement. 4. You allege lack of information submitting as evidence thereof, a copy of the Basic Rules and Regulations disseminated by the Central Bank as part of its annexes to Book IV (For non-Bank Financial Intermediaries) of the Manual of Regulations for Banks and other Financial Intermediaries, which copy does not include the Amendment of July 28, 1978. As regards your first contention, we believe that the Securities and Exchange Commission does not fall within the coverage of Presidential Decree No. 1603 inasmuch as said P.D. is general in application, that is, for ministries and offices which are not yet empowered by any law to promulgate rules. Section 1 of P.D. 1603 provides thus: "Each ministry, bureau or offices of the Government shall have the power to promulgate such rules and regulations as shall be necessary for the effective implementation of the provisions of laws, decrees, orders or instructions pertaining to such ministry, bureau or offices . . ." Republic Act Nos. 1143 and 5980 which are special laws, specifically empowered the SEC to make such rules and regulations as may be necessary for the proper execution of all the laws administered by it. Said P.D. 1603 has not amplified, broadened, diminished or amended the powers embraced in Republic Act Nos. 1143 and 5980. Considering further that these were the laws in effect when the amendment in question was passed and incorporated to the Basic Rules and Regulations Implementing R.A. No. 5 98 0, and the same were subsisting, said laws should likewise govern the validity and enforceability of said amendment. Relative to your second contention, the fact that the original certificate of authority does not contain any indication that it has to be renewed annually as it does not contain an expiry date and does not state anything about any requirement for its renewal annually is of no moment, inasmuch as following our premise, in reply no. 1, we consider the amendment in question valid and enforceable and under said amendment, the certificate of authority shall be renewable annually and the application for said renewal should be filed 45 days before the expiry date of the original certificate of authority. We cannot accept your claim that you were not furnished by the SEC the aforementioned requirement. Please be informed that as a matter of regular procedure, we provide financing companies copies of our rules and regulations. Furthermore, said amendments have already been published in two (2) newspapers of general circulation and the same may be considered as notice by publication. Notice by publication is notice in rem , binding against the whole world and necessitates no personal notices. As to the fact that a copy of the Basic Rules and Regulations disseminated by the Central Bank as part of its annexes to Book IV (For Non-Bank Financial Intermediaries) of the Manual of Regulations for Banks and Other Financial Intermediaries, does not contain said amendment, attention must be made to the fact that the Central Bank and the Securities and Exchange Commission are two (2) distinct and separate bodies. Needless to say, the CB Manual of Regulations is a publication of the Central Bank and not of the SEC. We cannot be responsible for any inaccuracies in it. Our records also show that prior to the incorporation of your company, your predecessor and similarly named company, the Anscor Finance Inc. (now: Anscor Capital & Investment Corporation) with Registry No. 91831 and with the same business and set of officers, stockholders and directors was incorporated on March 14, 1980. After the incorporation, the said company was granted Certificate of Authority No. 392 dated April 11, 1980. On March 26, 1981, the Commission had sent said company a letter advising said company to renew its license to operate as a finance company, a copy of which is attached, for your perusal. Said notice shows that this entity with the same incorporating directors and officers had in fact been made aware of the same rules as shown above. We, therefore, believe that the officers and directors of your corporation cannot honestly question the validity of said amendment. In conclusion, we are giving you 10 days from receipt hereof within which to comply with our requirements for renewal of your 1982 and 1983 licenses and also to pay the corresponding fines otherwise we shall be constrained to issue a cease and desist order since you have been operating without valid license since January 7, 1982. Please be guided accordingly. cdll Very truly yours, (SGD.) JESUS J. VALDES Associate Commissioner