SEC: New rules draw high compliance


DESPITE an ongoing petition that seeks to annul some of the provisions in the newly amended Implementing Rules and Regulations (IRR) of the Securities Regulation Code, most of the bourse’s stockbrokers and trading participants have nonetheless complied with the new requirements, the Securities Exchange Commission (SEC) said on Thursday.

In a statement, the corporate regulator said that of the 133 broker dealers/trading participants of the Philippine Stock Exchange (PSE), 88 of them have already submitted the new requirements, while two broker dealers requested and were granted an extension of time to comply with the 2015 IRR of the SRC, which took effect on November 9, 2015.

Compliance with the new requirements became mandatory on February 9, 2016.

In a letter dated January 8, 2016, the SEC directed the Capital Markets Integrity Corporation to remind the trading participants/brokers dealers to comply with the said rule.

“The amendments introduced in the 2015 SRC IRR are designed to address varying concerns. They are intended to enhance investor protection, address regulatory gaps, strengthen the market and regulatory structures, and adopt global best practices. I believe the final version faithfully implements the statutory requirements as mandated by SRC,” SEC chairperson Teresita Herbosa earlier said.

The new rules require stockbrokers and dealers to submit a detailed description of organizational and functional charts, the names and designations of the officers, including branch offices; risk management manual and internal control procedures; and business continuity and disaster recovery plan.

The said rule likewise requires stockbrokers, dealers and trading participants to submit a Comprehensive Information Technology Plan.

They were also ordered to submit an updated written supervision and control procedures, including procedures for establishing and segregating transactions, taking into consideration the requirements of the Anti-Money Laundering Act of 2001 (RA 9160, as amended), and the Revised Code of Corporate Governance.

Last month, the Philippine Association of Brokers and Dealers Inc. (PASBDI), the umbrella organization of brokers and dealers, filed a petition for declaratory relief with application for temporary restraining order or injunction seeking to nullify certain provisions in the 2015 IRR of the SRC.

The group assailed, among others, the amendments increasing transparency in the dealings of brokers and dealers, mainly with respect to the beneficial ownership disclosure requirement. The said amendment is meant to align the SRC with the Foreign Investment and Anti-Money Laundering acts.


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