Atty. J. Keith P. Nieto

August 21, 2002 SEC OPINION Atty. J. Keith P. Nieto M.M. Lazaro & Associates 19th Flr., Chatham House Building 116 Valero corner Herrera St. Salcedo Village, Makati City S i r : This refers to your letter dated August 13, 2002 requesting opinion on the applicability of SEC Memorandum Circular No. 05-01 dated May 23, 2001. The clear import of the abovementioned memorandum circular provides for the application of SEC Memorandum Circular No. 5 dated August 6, 1996 to both stock and non-stock corporations. However, the existence of provisions in your by-laws pertinent to the conduct of annual membership meetings and validation of proxies would mean application of said provisions instead of SEC Circular No. 5 dated August 6, 1996. In this regard, it has been said that "in view of the nature and function of by-laws as rules for the government of the corporation and its stockholders and members in the conduct and management of its affairs, it would seem that corporate meetings and elections and procedural and administrative matters relative thereto are peculiarly within the sphere of regulation of by-laws." (Rosario N. Lopez, The Corporation Code of the Philippines, p. 636, citing 9 Fletcher Cyc. Corp., rev. ed., Sec 4208 at 813-814). Please be guided accordingly. TAECSD Very truly yours, (SGD.) BENITO A. CATARAN Director