DragonFi secures SEC sandbox approval
MANILA, Philippines — DragonFi Securities Inc. has secured regulatory sandbox approval to offer Philippine investors access to select global stocks and exchange-traded funds (ETFs).
Tycoon Edgar Sia II’s DoubleDragon Corp. announced on Tuesday that it had gained admission to the Securities and Exchange Commission’s Strategic Sandbox, or Stratbox, in accordance with Memorandum Circular No. 9, Series of 2024.
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DragonFi said it has become the first licensed Philippine broker-dealer approved under the program to provide access to preapproved global equities and ETFs through over-the-counter depositary receipts (OTC DRs).
The framework ties an investor’s overseas investment limit to their Philippine holdings.
Investors with certified domestic investments may access foreign offerings equivalent to as much as 50 percent of the value of those holdings.
The limit may reach 100 percent for users maintaining Personal Equity and Retirement Account holdings.
Investors can acquire Philippine-registered counterparts to underlying international assets through OTC DRs, which will offer foreign securities.
DragonFi holds international securities and cash under segregated custody arrangements with global financial institutions. Local client funds will likewise remain segregated and kept with licensed domestic institutions.
“This is a defining milestone for DragonFi and for Philippine investors,” DragonFi CEO Jon Carlo Lim said. “What makes this framework especially meaningful is that global access does not have to come at the expense of our own capital markets.”
Lim added that the structure could help Filipinos diversify abroad while encouraging them to build their domestic investment portfolios.
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SEC Commissioner McJill Bryant Fernandez said the sandbox tests could help the corporate regulator improve its rules while widening investment choices, particularly for retail investors.
DragonFi will begin phased testing after it submits and validates its amended testing plan and client suitability protocols.
The initial rollout will cover a closely monitored group of users. Any expansion will remain subject to further SEC review and approval.
