Mr. Edwin C. Uy

December 14, 1994 Mr. Edwin C. Uy Asset Privatization Trust 10th Flr.,BA-Lepanto Building 8747 Paseo de Roxas, 1226 Makati, Metro Manila S i r : This refers to your letter of December 5, 1994 requesting confirmation that the sale by the Asset Privatization Trust (APT) of the shares presently owned by the Government in Philippine Shipyard and Engineering Corporation (PHILSECO) in favor of private local buyers is exempt from the registration requirements under the provisions of the Revised Securities Act . The right to transfer shares is conferred on express terms by the Corporation Code, quoted thereunder: "SECTION 63. Certificate of stock and transfer of shares . ... Shares of stock so issued are personal property ,and may be transferred by delivery of the certificate or certificates indorsed by the owner or his attorney-in-fact or other person legally authorized to make the transfer. No transfer; however should be valid, except as between the parties, until the transfer is recorded in the books of the corporation so as to show the names of the parties to the transaction, the date of the transfer the number of the certificate or certificates and the number of shares transferred. No shares of stock against which the Corporation holds any unpaid claim shall be transferable in the books of the corporation." (Emphasis supplied) Therefore, transfer of outstanding shares ordinarily does not require prior approval of the Commission. However, it is to be emphasized that should the outstanding shares be sold to the public ,that is, to a number of persons indiscriminately , the issuer corporation shall be required to have its entire authorized capital stock registered pursuant to the provisions of the Revised Securities Act. Based on the facts presented in your letter, we cannot categorically determine whether or not the above-mentioned transaction is exempt from registration requirements since the amount involved and the number of purchasers are not disclosed. Very truly yours, (SGD.) FE ELOISA C. GLORIA Associate Commissioner