Hon. Gloria Macapagal

March 24, 1993 Hon. Gloria Macapagal Senate Manila M a d a m : This refers to your letter dated March 18, 1993, requesting comments on Senate Bill No. 529 entitled: "AN ACT PRESCRIBING LIMITS ON PESO BORROWINGS BY NON-FILIPINO BUSINESS ENTITIES OPERATING IN THE PHILIPPINES. We wish to inform you that the Commission supports the objective of the Bill as it is in keeping with the Government's nationalistic policy contained in the Philippine Constitution ensuring Filipinos' rightful preference of the country's economic opportunities. National interest dictates that Filipinos should be given priority over foreigners to avail of the financial resources of this country. The intended limitation would open up the possibility of foreign owned business entities to float their shares of stocks to the public thereby enhancing the development of our capital market. However, it is suggested that the "peso borrowing" as defined under Section 2(a) of the Bill should not only be limited to credits in Philippine currency obtained from domestic banks and other financial institutions, but should also embrace borrowings sourced from all domestic credit facilities, institutional or public. This proposal is made in view of the access of business entities to money market funds through the flotation and issuance of commercial papers and bonds. The inclusion of all possible domestic credit sources would be more in keeping with the laudable intent of the bill. Likewise it is suggested that since under Republic Act 7042, otherwise known as the Foreign Investments Act of 1991 and the Corporation Code, the SEC has the jurisdiction to register & regulate foreign corporation and corporations/partnerships with foreign equity/participation, it should be included in the Inter Agency Committee to be created pursuant to Sec. 5 of the Bill. Very truly yours, (SGD) ROSARIO N. LOPEZ Chairman