The Securities and Exchange Commission (SEC) has warned the public against dealing with unregistered entities, wholly or partly owned by foreign nationals, engaging in retail trade.
In an advisory issued Monday, the SEC said it has received numerous complaints or reports about the existence of these entities or those acting beyond the authority granted in their articles of incorporation/partnership, constituting a violation of Republic Act (RA) 8762, otherwise known as the Retail Trade Liberalization Act of 2000.
Under RA 8762, retail trade enterprises with paid-up capital of less than USD2.5 million are exclusively reserved for Filipino citizens.
It provides that full foreign participation is allowed only if these firms have paid-up capital of USD2.5 million or more and investments for setting up a store should be USD830,000; and are specializing in high-end or luxury products with paid-up capital per store not less than USD250,000.
A retail trade company sells directly to the general public merchandise, commodities or goods for consumption.
RA 8762 provides that any person who shall be found guilty of violating any provision of the act shall be punished by imprisonment of six to eight years, and a fine of PHP1 million to PHP20 million.
The SEC further advised the public to be mindful of the provision of Commonwealth Act No. 108, as amended, otherwise known as the Anti-Dummy Law, prohibiting the employment of aliens in all entities engaged in nationalized activities.