Belo Gozon Elma Parel Asuncion & Lucila Law Offices

April 18, 1996 Belo Gozon Elma Parel Asuncion & Lucila Law Offices 15th Flr.,Sagittarius Condominiums H.V. dela Costa St.,Salcedo Village Makati City Attention : Atty . Michael Albert H . Kahayon S i r : This refers to your letter dated March 19, 1996, questioning the assessment imposed by the Commission upon your client, the GMA Network, Inc.,a filing fee of 1/10 of 1% of its present authorized capital stock plus 20% thereof amounting to P1,212,200.00 for its application for extension of corporate term ,claiming that there is no basis for such assessment. Please be advised that the authority of the Commission to impose a filing fee for Amended Articles of Incorporation extending the corporate term, emanates from RA No . 3531 approved on June 20, 1963, quoted in part hereunder: prcd "The Securities and Exchange Commissioner shall be entitled to collect and receive the sum of ten pesos for filing said copy of the amended articles of incorporation: Provided, however; That where the amendment consists in extending the term of corporate existence the Securities and Exchange Commissioner shall be entitled to collect and receive for the filing of the amended articles of incorporation the same fees collectible under existing law as the filing of articles of incorporation ." (Emphasis supplied) The above provision is not deemed repealed by the present law on corporations, Batas Pambansa Blg. 68, otherwise known as the Corporation Code of the Philippines, as Section 146 of the latter law, quoted hereunder, provides that only laws or parts thereof inconsistent with the provisions of the Code are deemed repealed. "SECTION 146. Repealing clause . Except as expressly provided by this Code, all laws or parts thereof inconsistent with any provision of this Code shall be deemed repealed." (Emphasis supplied) The use of the phrase " or parts thereof inconsistent with any of the provision of this Code shall be deemed repealed " in the above provision is a manifest indication that parts of existing laws which are not affected and are not inconsistent with the provisions of the Corporation Code shall continue to have full force and effect. Thus, to inform the public that the statutory intention to impose a higher filing fee on application for extension of corporate term is still effective, the Commission issued SEC Circular, Series of 1986 which states: "The Commission, pursuant to the powers vested in it under PD 902-A, RA 1143, the Revised Securities Act and RA 3531 , as amended by BP No. 68, hereby adds a new paragraph 5a to the Revised Fees and charges of the Securities and Exchange Commission to read as follows: "5a Examination and filing fees for amended articles of incorporation of both stock and non-stock corporations, where the amendment consists of extending the term of corporate existence: 1) Stock Corporations: a.) Stock corporations 1/10 of 1% of the authorized capital stock but not less than P200.00 not more than P 100,000.00." ..."(Emphasis supplied) The issuance of the above Circular conforms with Section 139 of the Corporation Code which provides: "SECTION 139. Incorporation and other fees . The Securities and Exchange Commission is hereby authorized to receive and collect fees as authorized by law or rules and regulations promulgated by the Commission ." (Emphasis supplied) Take note further that while the above Circular provides for a maximum filing fee of P100,000.00, it is deemed amended by virtue of SEC Memorandum Circular No. 2 Series of 1994, which no longer provides for a maximum filing fee for Articles of Incorporation. Under the latter Circular the filing fee for Articles of Incorporation is now 1/10 of 1% of the authorized capital stock plus 20% but not less than P500.00. As earlier mentioned, RA 3531 requires that where the amendment consists of extending the term of existence, the SEC shall be entitled to collect and receive the same fees collectible under existing law for the filing of articles of incorporation. In the light of the foregoing, we believe that the questioned assessment is in accordance with law. Accordingly, you are hereby required to comply with the required filing fee. Very truly yours, (SGD.) FE ELOISA C. GLORIA Associate Commissioner