THE fight between the Dees and the Singaporeans over the affairs of Alliance Select Foods International Inc. has worsened. The latter have filed not a few cases against the former for, among others, refusing to make public the books of the corporation that the minority has long been asking. The latest was a derivative suit, meaning the Singaporeans decided it was time to go to court again to sue for and in behalf of the company.
Opening the books is the only way for George Sycip, an independent director and chairman of the board, and his patrons to disprove the allegation of their foreign partners that they have certain questionable deals and transactions. Apparently they did not want to make their deals public.
Then, on June 11, the Dees posted something that should shock the SEC’s and PSE’s market monitoring teams. If the regulators would read between the lines, then they would learn more from the war of words—that is, the battle of press releases—what Alliance Select and the Dees have failed to disclose or neglected to properly disclose.
For instance, why should the Dees, as majority stockholders of Alliance Select, reveal only to the Singaporeans “information relating to the company’s financials” that they said were “given to them–referring to the Singaporeans—in confidence”?
Should they not have posted the said secret “company’s financials” instead on the PSE website for everybody to read and appreciate?
As a listed company whose shares are traded on the exchange, Alliance Select is also public even if only a few shares are held by investors outside of the majority.
As such, anything, more importantly financial information, that concerns the company should be made available to ALL stockholders and not only to Hedy Yap Chua and Dr. Albert Hong Hin Kay.
Why should the SEC and the PSE tolerate the Dees’ monopoly of inside information that they might use to their advantage? Should not their officials punish the Dees for keeping corporate information to themselves?
To erase any suspicion that the Dees have not used inside information to their advantage as the controlling stockholders of Alliance Select, it is time for the SEC to intervene by examining ALL the deals of the Dees and ALL the details of their every deal.
The SEC and PSE officials should apply the market’s full disclosure requirement on everybody.
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IF you, as a consumer, feel that you have been cheated by a company and you want to confront its management but could not find it anymore at the address where you used to deal with it, there is only one agency to go to: the Securities and Exchange Commission.
But what if the address given by this company in its Articles of Incorporation is only “Metropolitan Manila” or only a town or city in other parts of the country? Chances are you would not be able to trace the company anymore and confront its owners and managers about your complaints.
Yes, the problem with SEC-registered businesses is that they have been allowed to abbreviate the address of their principal offices in their charter to just the name of a town, city or metropolis such as Metro Manila, Metro Cebu or Metro Davao.
Thankfully, the SEC recently came up with a solution to your problem. As a much-abused saying goes, “better late than never”, or “better late than later”. It now requires companies to provide in their Articles of Incorporation their exact principal address as part of its full disclosure rule.
In signing Memorandum Circular No. 6 on February 20, 2014, SEC Chairperson Teresita Herbosa said the use of “Metro Manila” as a principal address is not allowed anymore.
In effect, all SEC-registered companies that used “Metro Manila” as their principal address or headquarters should amend the pertinent provisions of their charter to specify where they do business.
Actually, the SEC’s latest circular is only a follow-up to MC No. 3 that the SEC issued on February 16, 2006 “directing registrant corporations and partnerships to state in their Articles of Incorporation or Articles of Partnerships the specific address of their principal office.”
“Principal office,” as the SEC defines it in its circular, “shall include, if feasible, the street number, street name, barangay, city or municipality.”
Amending a corporate charter may be expensive but it should be done to incorporate the complete principal address of a company, be it a stock or non-stock corporation or a partnership. It is for the benefit of the public.
The SEC circular requiring the complete principal address or headquarters in the Articles of Incorporation also covers listed companies. It is really surprising that a few of the so-called public companies listed on the Philippine Stock Exchange have not been compliant with the SEC circular on stating their full address when the rule has been in place since 2006.