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REGULATORS and mining groups are set to implement
standards for public reporting of mineral assets to avoid misleading
investors and boost confidence in the local industry.
In a briefing, Francis Lim,
Philippine Stock Exchange (PSE) president, said the government and
various groups are working on the implementing guidelines of the
Philippine Mineral Reporting Code (PMRC) that is expected to be
enforced by January next year.
The PMRC is an initiative of the
Philippine Minerals Development Institute Foundation (PMDIF)
together with the PSE, Mines and Geosciences Bureau (MGB), Chamber
of Mines of the Philippines, Philippines-Australia Business Council
and the Board of Investments.
It is based on the international
codes from Australia, South Africa, European Union, Canada and the
Australian Joint Ore Reserves Committee Code and International
Reporting Template.
Benjamin Philip G. Romualdez,
mining chamber president, said the industry is “highly
speculative” and relies on information disclosed since companies
are hard to value based on international accounting standards that
do not include minerals that are not yet mined.
The PMRC, therefore, would
provide transparency and sufficient information should be clear,
unambiguous and not misleading, he said.
“We don’t want companies and
executives of companies to take advantage of the less informed
investing public when it comes to their company stock,” he said.
With the standards of reporting
in place, the investing public would be assured that the information
is accurate when a company discloses that it has certain amount of
gold, copper or nickel reserves since there is an independent
“competent person” who stated such information, the chamber
official said.
The “competent persons” would
come from the pool accredited by the Philippine Society of Mining
Engineers, Geological Society of the Philippines and Society of
Metallurgical Engineers of the Philippines.
Failure to comply with the
standards would merit penalties imposed by the PSE and the
Securities and Exchange Commission since these regulators would be
adopting the PMRC guidelines. For its part, MGB would halt the
application process of the firm that fails to comply.
Rudy C. Obial of PMDIF said the
standards would prevent another “Bre-X incident” to happen and
keep the integrity of mining companies intact.
Bre-X was a Canadian mining
company that claimed it was sitting on a gold mine in Busang
Indonesia but later discovered to be a scam as the samples were
reported to be tampered with. The company’s shares collapsed and
Bre-X was delisted from the Toronto Stock Exchange after investors
lost billions of dollars.
--Likha C. Cuevas-Miel
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