SEC suspends nearly 118,000 firms for annual report snub
MANILA, Philippines —The Securities and Exchange Commission (SEC) suspended nearly 118,000 corporations for failing to submit the required annual report even after extending the deadline.
The SEC’s company registration and monitoring department ordered the suspension of their certificates of incorporation last Feb. 16. This was after the companies did not submit their annual reports for more than five years.
“The issuance of the suspension order follows the conclusion of the SEC Amnesty Program, which ran from March to December 2023 and gave noncompliant and suspended or revoked corporations a chance to recover their good standing by paying the reduced fees,” the corporate watchdog said in a statement on Wednesday.
READ: Take advantage of amnesty program, SEC urges erring firms
It noted that the list of suspended firms also included corporations that have commenced their business but subsequently became inoperative for more than five consecutive years.
Delinquent status
“Corporations registered with the SEC are required to submit reportorial requirements such as annual financial statements and general information sheets,” the SEC said.
Article continues after this advertisementThe SEC also has the power to place under delinquent status corporations found to have failed in filing their reportorial requirements three times, consecutively or intermittently, within a period of five years.
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According to Section 21 of the Revised Corporation Code of the Philippines, a corporation that starts its operations but then ceases to be active for at least five consecutive years can be declared delinquent.
Moreover, the regulator has the authority to suspend a franchise or certificate of incorporation, following due process with notice and hearing.
“The SEC has given the suspended corporations a period of 30 days from the publication of the suspension order, to avail of existing remedies under the laws, rules and regulations implemented by the commission,” the statement showed.
