Amnesty on Penalties for Non-Submission/Late Submission of Reportorial Requirements

September 14, 1998 SEC-SMD * MEMORANDUM CIRCULAR NO. 02-98 SUBJECT : Amnesty on Penalties for Non-Submission/Late Submission of Reportorial Requirements Whereas, the Commission pursuant to the mandate of the Corporation Code and P.D. 902-A as amended, has tasked the Supervision and Monitoring Department to monitor compliance by corporations that are not subject to the reportorial provisions of the Revised Securities Act Rule 11(a)-1 and also those with secondary licenses issued by the Commission, with the rules on submission of annual required reports; LibLex Whereas, many of the aforementioned corporations are remiss in the submission of the required reports but are seeking reduction/reconsideration of the assessed penalties, primarily on the ground that the prevailing economic situation adversely affects their respective operations; Whereas, the Commission is cognizant that the objective of accurate and updated disclosure of the activities of corporations thru the submission of required reports should not be carried out to the detriment of corporations experiencing difficult times. Whereas, the Commission by virtue of Memorandum Circular No. 1 (SMD Series of 1997) dated September 1997, granted an Amnesty on Penalties imposed on corporations covering required reports up to 1995. Whereas, the Commission has deemed it appropriate to extend the coverage of the amnesty. Wherefore, the Commission by virtue of the powers vested upon it by existing laws, hereby declares an amnesty on the penalties imposed on corporations under the conditions herein provided. SECTION 1. Scope and Amount of Penalties . This Circular shall apply only to violations by corporations, stock or non-stock except those that are subject to the reportorial provisions of the Revised Securities Act Rule 11(a)-1 and also those with secondary licenses issued by the Commission, with the rules on submission of required reports, namely: the General Information Sheet (GIS) and/or the affidavit of non-holding of annual meeting (ANHM) and the Financial Statements (FS) and the registration of Stock and Transfer Book (STB) or Membership Book (MB) which are due upon the effectivity of this circular. Corporations whose certificate of registration have either been suspended or revoked cannot avail of this circular unless the appropriate petition for the setting aside of said orders are filed within the prescribed period under existing rules and given due course by the Commission before the lapse of the effectivity of this Circular. The compromise penalties shall be as follows: 1. For STOCK CORPORATIONS Non-filing/Late filing of: Required Report Period Covered Penalty per required report a. General Information 1981 to 1995 P500.00 Sheet or Affidavit of Non-Holding of Annual Meeting 1996 to present P1,000.00 w/ retained earnings up to 1M P1,500.00 w/ retained earnings of more than P1M up to P5M P2,000.00 w/ retained earnings of more than P5M b. Financial Statements 1981 to 1994 P500.00 1995 to present P1,000.00 w/ retained earnings up to P1M P1,500.00 w/ retained earnings of more than P1M up to P5M P2,000.00 w/ retained earnings of more than P5M c. Affidavit of Non- Operation 1981 to present P50.00 Stock Corporations with deficit shall be assessed P500.00 per report while those with capital deficiency shall be assessed P250.00 per report. II. For NON-STOCK CORPORATIONS Required Report Period Covered Penalty per required report a. General Information 1981 to 1995 P200.00 Sheet or Affidavit of Non-Holding of Annual Meeting 1996 to present P300.00 w/ fund balance up to P100,000.00 P400.00 w/ fund balance of P100,001.00 up to P500,000.00 P500.00 w/ fund balance of more than P500,000.00 b. Financial Statements 1981 to 1995 P200.00 1995 to present P300.00 with fund balance of P100,000.00 P400.00 w/ fund balance of P100,001.00 up to P500,000.00 P500.00 w/ fund balance of more than P500,000.00 c. Affidavit of Non- Operation 1981 to present P50.00 Non-stock corporations with negative fund balance, shall be assessed P100.00 per report. III. LATE REGISTRATION OF: Stock and Transfer Book (stock corporation) P75.00 Membership Book (non-stock corporation) P50.00 SECTION 2. Documents to be Submitted . The following documents shall be submitted to the Supervision and Monitoring Department, 7th Floor, SEC Bldg., EDSA, City of Mandaluyong. 1. Sworn Statement by the president or duly authorized officer specifying therein the reportorial requirements not filed/submitted late and the years covered; (sample form copy attached hereto) 2. General Information Sheet 1996 to present (if not yet submitted) Affidavit of Non-Holding of Annual Meeting 1996 to present (if not yet submitted) Financial Statements 1995 to present (if not yet submitted) 3. Affidavit of Non-Operation 1981 to present (when applicable) 4. Register prescribed Stock and Transfer Book/Membership Book (if not yet registered) and pay registration fee of P100.00 and P50.00, respectively. Only application for amnesty with complete required documents shall be accepted . SECTION 3. Period of Submission of Documents and Payment of Compromise Penalties . The compromise penalties shall be paid in cash or in manager's/cashier's check or postal money order payable to the Securities and Exchange Commission, SEC Bldg., EDSA City of Mandaluyong within the period hereunder specified: Corporation's Principal Office Prescribed Submission Period Group I Makati Manila, Quezon City, Pasay October 01 to October 31, 1998 Group II Caloocan, Mandaluyong, Marikina, Muntinlupa, Paraaque, Pasig, San Juan November 02 to November 29, 1998 Group III Las Pias, Malabon, Navotas, December 01 to December 29, 1998 Pateros, Taguig, Valenzuela Provided that corporations, which will avail of the amnesty after the respective period assigned to them but not later than December 29, 1998, shall pay, in addition to the compromise penalty, 20% surcharge of the total penalty for such corporations. cdlex Corporations whose principal offices are located within the area of the Commission's respective Extension Offices or nearest thereto may avail of this amnesty in said area of responsibility or at the main office at any time between October 01 and December 29, 1998. The SEC extension offices are as follows: REGION LOCATION OF OFFICE REGION 1 (Ilocos Region) Abra BAGUIO EXTENSION OFFICE Benguet Baguio City 76 Upper Gen. Luna Road Ilocos Norte Laoag City 2600 Baguio City Ilocos Sur La Union Mt. Province Pangasinan Dagupan City San Carlos City REGION V (BICOL) Albay Legaspi City LEGASPI EXTENSION OFFICE Camarines Norte 2nd Floor, RUE Building Camarines Sur Naga City 443 Rizal Street, Cabagnan Iriga City 4500 Legaspi City Catanduanes Masbate Sorsogon REGION VI (WESTERN VISAYAS) Aklan ILOILO EXTENSION OFFICE Antique 9 Rizal cor. Gomez Street Capiz Roxas City 5000 Iloilo City Iloilo Iloilo City Negros Occidental Bacolod City Bago City Cadiz City Carlota City San Carlos City Silay City REGION VII (CENTRAL VISAYAS) Bohol Tagbilaran City CEBU EXTENSION OFFICE Cebu Cebu City 4th Floor, Danague Bldg., Danao City Osmena Boulevard Lapu-Lapu City 6000 Cebu City Mandaue City Toledo City Negros Oriental Bais City Canlaon City Dumaguete City Siquijor Provinces REGION IX (WESTERN MINDANAO) Basilan ZAMBOANGA EXTENSION Sulu OFFICE Tawi-Tawi 2nd Floor JV Bldg., San Jose Zamboanga City Panigayahan Zamboanga del Norte 7000 Zamboanga City Dapitan City Dipolog City Zamboanga del Sure Pagadian City REGION X (NORTHERN MINDANAO) Agusan del Norte Butuan City CAGAYAN DE ORO EXTENSION OFFICE Agusan del Sur Bukidnon Philippine Veterans Bank Camiguin 2nd Floor, Toribio Chavez Street Misamis Occidental 9000 Cagayan de Oro City Oroquita City Tangub City Ozamis City Misamis Oriental Gingoog City Surigao del Norte Surigao City REGION XI (SOUTHERN MINDANAO) Davao del Norte Davao City DAVAO EXTENSION OFFICE Davao Oriental 3rd Floor, G.B. CAM Building, Mati (Capital) Monteverde Street, Davao City South Cotabato 8000 Gen. Santos City Surigao del Sur SECTION 4. Misrepresentation in the Sworn Statement . Any misrepresentation in the sworn statement required under this Circular shall subject the corporation to the present scale of fines prescribed, in addition to the criminal prosecution of the affiant. SECTION 5. Effect of Failure to Avail of this Memorandum Circular . Corporations which fail to avail of this memorandum circular shall be subject to the scales of fines presently prescribed, in addition to suspension/revocation of their certificate of registration whenever applicable. SECTION 6. Effectivity . This Circular shall take effect immediately. cdlex (SGD.) FE ELOISA C. GLORIA Associate Commissioner (Please accomplish in triplicate) SWORN STATEMENT I, _____________________________________, Filipino, of legal age and residing at _______________________________, ______________, after having been duly sworn in accordance with law, hereby depose and state: 1. That I, in my capacity as _________________, have been authorized to Position represent __________________________________, a domestic corporation duly organized and existing under the laws of the Philippines, with principal office address at ______________________________, registered with the Securities and Exchange Commission on __________________, 19____, with SEC Registration No. _____________________; 2. That from available records on file with the corporation, the following SEC reportorial and related requirements covering the period from 1981 to the present, have not been complied with within the prescribed period: REQUIREMENT SPECIFIC YEAR(S) COVERED ( ) General Information Sheet (GIS) ____________________ ____________________ ( ) Financial Statements (F/S) ____________________ ( ) Affidavit of Non-Holding of ____________________ Annual Meeting(s) (ANHM) ____________________ ( ) Affidavit of Non-Operation (ANO) ____________________ ____________________ ( ) Stock and Transfer Book/Membership Book ____________________ 3. That per 1995/1996/1997/1998 Financial Statements submitted to the SEC, the corporation has: (Please check appropriate item and indicate corresponding amount) 1995 1996 1997 1998 ( ) Retained Earnings P _____ P _____ P _____ P _____ ( ) Deficit P _____ P _____ P _____ P _____ ( ) Capital Deficiency P _____ P _____ P _____ P _____ ( ) Fund Balance/Members' Equity P _____ P _____ P _____ P _____ ( ) Negative Fund Balance P _____ P _____ P _____ P _____ 4. That its certificate of registration is neither suspended nor revoked by the Commission; 5. That per by-laws, the annual meeting of stockholders/member is schedules to be held on ____________________ of each year; 6. That any misrepresentation in this sworn statement shall subject the corporation to reassessment of penalties based on the scale of fines applicable thereto, in addition to possible criminal prosecution of the affiant; 7. That I am executing this Statement in compliance with SEC Memorandum Circular No. 2, SMD Series of 1998. _________________ Place/Date _________________ Affiant REPUBLIC OF THE PHILIPPINES) ____________________________) S.S. SUBSCRIBED AND SWORN TO BEFORE ME this _____ day of ________, 1998 in _______________________, affiant exhibiting to me his/her Community Tax Certificate No. _________________ issued at _________ on _________________. Doc. No. _________ NOTARY PUBLIC Page No. _________ Book No. _________ Series of 1998 Sample only Modified Scale of Fines for Domestic Stock Corporations For Late Submission of SMD Required Reports Footnotes * Supervisory and Monitoring Department; now Company Registration and Monitoring Department