Firms with less than 10% public float face trading suspension
At least 27 listed companies face trading suspension by the first trading day of 2013 if they would not be able to raise their public float to at least 10 percent as required by the Philippine Stock Exchange.
During the trading suspension, the sale of these companies shares may be done only outside the trading system of the PSE (over the counter) and these will be subject to a capital gain tax of between 5 and 10 percent, the PSE said.
Shares of listed companies, when traded, will enjoy the preferential tax rate of ½ of 1 percent.
On top of the capital gains tax, equivalent to 5 percent for transactions up to P100,000 and 10 percent for those in excess of P100,000, the trading of the shares of suspended companies will be slapped with a documentary stamp tax of P0.75 per P200 of the par value of the stock.
“If the fair market value of the shares of stock sold is greater than the consideration or the selling price, the amount by which the fair market value of the shares exceeds the selling price shall be deemed a gift that is subject to donors’ tax under section 100 of the National Internal Revenue Code,” PSE president Hans Sicat said in a memorandum dated Aug. 22.
In the memorandum, the PSE gave non-compliant companies until Dec. 31 this year to comply. Immediately after the grace period, the exchange will impose a trading suspension on the affected shares for a period of not more than six months, after which delisting procedures may take place.
Based on a PSE report on the free float of listed companies, 27 companies have yet to comply with the minimum public ownership requirement.
These include three from the banking and financial services sector: Allied Bank, First Metro Investment Corp. and Maybank ATR Kim Eng Financial Corp. Two are from the industrial counter: SPC Power and Vivant Corp. In the food, beverage and tobacco sector, the following are short of requirements: Alaska Milk Corp., Cosmos Bottling, San Miguel Pure Foods Co. and San Miguel Brewery.
