The Philippine Competition Commission asked SM Prime Holdings Inc. and state-owned Bases Conversion Development Corp. to pay a P2-million fine for late notification of their P51.27-billion joint venture partnership.
PCC ordered SM Prime and BCDA to pay the P2-million fine within 45 days from the promulgation of the decision.
SM Prime and BCDA signed a joint venture partnership on Aug. 10, 2018 to develop the 33.1-hectare Bonifacio South Pointe in Taguig City.
Under the PCC rules, parties to a merger should notify the PCC within 30 days from the signing of the definitive agreements.
PCC said that while SM Prime and BCDA attempted to submit their notification forms to PCC’s Mergers and Acquisitions Office on the evening of Sept. 10, the application was not accepted because it was well beyond office hours.
The following day, representatives from BCDA and SM Prime went to PCC to personally re-submit the notification forms.
PCC said it still refused to accept the forms for being non-complaint with the requirements. The anti-trust body said BCDA’s notification form did not include an authorization granting Atty. Aileen Soza authority to file the forms on behalf of BCDA.
It said SM Prime’s forms also did not include authorization granting the company to file with the PCC on behalf of its parent firm SM Investments Corp.
PCC said while SM Prime and BCDA submitted their forms on Sept. 14 and Sept. 18, respectively through registered mail, the submission of notification forms by mail was not acceptable under the merger rules.
It said BDCA resubmitted the forms on Oct. 5, but it was only on Dec. 28 when SM Prime resubmitted its forms. It was only then that the notification for the proposed transaction was deemed submitted.
SM Prime argued that the late filing was due to the volume of documents required for the notification.
The property firm also claimed that its first attempt to file on Sept. 10, or 30 days after the signing of the joint venture agreement, should be considered as valid notification.
PCC, however, said SM Prime could not use the volume of documents required for the late notification because the only reason its forms were not accepted on Sept. 11 was the lack of authorization from its parent firm.
“SM Prime’s explanation that the late refiling was due to the volume of documents required to be submitted is unsatisfactory. The MAO receiving firm issued on 11 September 2018 indicates the lack of authority as the only reason for the non-admission of SM Prime’s form. This could hardly be the of such volume as to prevent SM Prime from complying with the formal requirements for submission of a notification form under Section 5.3 of the merger rules,” PCC said.