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The Securities and Exchange Commission (SEC) is drafting new rules that seek to empower minority shareholders of publicly-listed companies to call for special meetings and put items in the agenda.
Based on a draft memorandum circular released by the SEC on April 15, shareholders representing at least 10 percent of the public firm’s outstanding capital stock will henceforth have the right to call for a special stockholders’ meeting.
The holding of such special meetings will be subject to the guidelines set under Section 49 of Republic Act No. 11232, or the Revised Corporation Code of the Philippines, as may be applicable.
Meanwhile, shareholders representing at least 5 percent of the outstanding capital stock – the minimum stake generally considered to be a “significant” minority shareholder – have the right to include items in the agenda prior to a regular or special stockholders’ meeting.
Any officer or agent of the corporation who will refuse to allow a qualified shareholder to exercise the right to call for a meeting and/or put items on the agenda can face administrative sanctions provided under the Revised Corporation Code, the draft showed.
If the refusal is made pursuant to a resolution or order of the board of directors, the liability for such action will fall upon the directors who voted for such refusal.