Delinquent companies registered with the Securities and Exchange Commission (SEC) will have until end-November 2024 to restore their good standing by completing their application for the Enhanced Compliance Incentive Plan (ECIP).
The SEC, in a statement, reminded non-compliant companies to clear their track record and settle their fines and penalties for the late and non-filing of reportorial requirements at lower rates before the Nov. 30, 2024 deadline.
“With less than a month left before we officially close ECIP, we encourage non-compliant, suspended and revoked corporations to complete their applications to ensure the continuous operations of their businesses,” SEC chairperson Emilio Aquino said.
“We remind corporations that the submission of reportorial requirements is mandated by law, and failure to comply could result in the suspension or revocation of their corporate registration,” he said.
Republic Act No. 11232, or the Revised Corporation Code of the Philippines, requires all SEC-registered corporations to submit their annual financial statements (AFS) and General Information Sheets (GIS).
Non-compliance could lead to the imposition of applicable fines and penalties and, for extreme cases, the suspension or revocation of corporate registration, the SEC said.
This strips a company of the powers and privileges granted to a registered corporation, including separate juridical personality, limited liability, and perpetual existence, among others.
Corporations that incurred fines and penalties for the late or non-filing of their AFS or GIS, as well as non-compliance with MC No. 28, Series of 2020, which requires corporations to designate official and alternative contact details, may apply for ECIP.
Under the program, non-compliant corporations, including those under the delinquent status, should pay only P20,000 to settle their fines and penalties for the covered violations, while suspended or revoked corporations would have to pay 50 percent of their total assessed penalties and a petition fee of P3,060 to lift their order of suspension/revocation.
Eligible corporations will have to submit their latest due AFS and GIS as part of their application to regain their good standing.
Suspended/revoked firms, meanwhile, will have to submit their petition to lift the order of suspension or revocation, along with other supporting documents.
Eligible corporations, which fail to avail of ECIP, will be subjected to the updated scale of fines and penalties that the SEC implemented in April through MC No. 6, Series of 2024.
The new rates are around 900 percent to 1,900 percent higher compared to the previous rates that had been in place for more than two decades.
