Unfavorable market conditions have prompted regulators to defer the issuance of new rules hiking the minimum public float for listed firms.
The Securities and Exchange Commission (SEC) wants to gradually raise this to 20 percent from 10 percent and last year officials said that an implementing circular would be issued by the first quarter of 2018.
“For the existing companies, we plan to raise it to 15 percent [initially]. But we’re still studying the matter because unfortunately the market is not that stable to admit this increase,” SEC Chairperson Teresita Herbosa told reporters last Friday.
Volatility, she said, has spooked investors and there may be no take-up of the shares that will be made available.
“[T]here may [be]no buyers at this point or only a few shares will be sold. It will be very difficult for some companies to comply with that increase,” Herbosa said.
The release of the implementing circular, she added, would likely be done “in the middle of 2018.”
The 20 percent public float requirement, however, is already in effect for companies planning to conduct an initial public offering.