SEC MC No. 06, Series of 2024: Updated Fines and Penalties on Late and Non-Submission of AFS and GIS

SEC MEMORANDUM CIRCULAR NO. ______ Series of 2024 TO : ALL CONCERNED SUBJECT : UPDATED FINES AND PENALTIES ON THE LATE AND NON￾SUBMISSION OF AUDITED FINANCIAL STATEMENTS (AFS), GENERAL INFORMATION SHEET (GIS), NON-COMPLIANCE WITH SEC MEMORANDUM CIRCULAR NO. 28, SERIES OF 2020 (SEC MC 28) DATE : 27 March 2024

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WHEREAS, Section 179(o) and (p) of Republic Act (RA) No. 11232, otherwise known as the Revised Corporation Code of the Philippines (RCC), grants the Commission the power and authority to: (i) formulate and enforce standards, guidelines, policies, rules, and regulations to carry out the provisions of the RCC; and (ii) exercise such other powers provided by law or those which may be necessary or incidental to carry out the powers expressly granted to it; WHEREAS, Section 158 of the RCC provides that the Commission has the power to impose fines ranging from Five Thousand Pesos (PhP 5,000) to Two Million Pesos (PhP 2,000,000) and a daily fine of no more than One Thousand Pesos (PhP 1,000) for continuing violations, but in no case to exceed Two Million Pesos (PhP 2,000,000); WHEREAS, the Commission, through SEC Memorandum Circular No. 2, Series of 2023 (SEC MC 2), and subsequent amendments thereto, granted amnesty for late and non-filing of GIS and AFS and non￾compliance with SEC MC 28 to provide corporations with ample and cost-effective opportunity to update their compliance with the documentary and reportorial requirements under the RCC, among others; WHEREAS, the Commission, through its issuances, webinars, social media posts, and press releases, had actively campaigned and encouraged non-compliant, suspended or revoked corporations to apply for amnesty under SEC MC 2 to avoid hefty monetary penalties once the revised scale of fines and penalties is implemented; WHEREAS, the final deadline for amnesty applications under SEC MC 2, as amended, was 31 December 2023; WHEREAS, the Commission strives to comply with one of the remaining requirements to remove the Philippines from the gray list of the global anti-money laundering watchdog, Financial Action Task Force, by enhancing and streamlining the access to beneficial ownership information and taking steps to ensure that the information is accurate and up to date through the corporations’ regular submission of the GIS; WHEREAS, it has been observed that there is a need for continuous and rigid monitoring of violations pertaining to reportorial requirements, especially for habitual erring corporations, in order to maintain an accurate database which shall determine and identify active and inactive corporations and those who are already due to be placed under delinquent status; WHEREAS, upon a thorough review of all active regulated entities, the Commission saw the need to reevaluate its existing scale of fines and penalties to meaningfully deter violations and non-compliance with current regulations; 6 Published: Philippine Star, 28 March 2024 Business Mirror, 28 March 2024 Filed with UP Law Center: 27 March 2024

WHEREAS, the Commission has not introduced any modification in the schedule of fines and penalties since the issuance of the guidelines on the imposition of fines and penalties for non-compliance with reportorial requirements in July 2002; WHEREAS, an exposure draft of the Revised Fines and Penalties on Submission of Reportorial Requirements (AFS & GIS) was published on the SEC website on 26 April 2023 to solicit comments from the public until 26 May 2023, and to ensure transparency and public awareness; NOW THEREFORE, the Commission shall impose the following updated fines and penalties to all regulated entities: I. DEFINITION OF TERMS A. For One Person, Stock, and Non-Stock Domestic Corporations a. Filed/Submission on Time means the punctual submission of the reportorial requirements, as prescribed by the Commission: Reportorial Requirements Period to File / Register GIS1 Within thirty (30) calendar days from the date of the actual meeting. For Financing and Lending Companies, the reckoning period for the filing of the GIS is from the date of actual meeting or within seven (7) calendar days from the date of change, as the need arises. AFS Within one hundred twenty (120) calendar days from fiscal year-end or as prescribed by the Commission. SEC MC 28 Upon filing of the registration forms or within thirty (30) calendar days from the issuance of the certificate of registration, license, or authority. b. Late Filing/Submission means the submission of the reportorial requirements which may either be: i. Filing after the due date but still within a year of the prescribed deadline for filing; ii. Filing beyond one (1) year from the prescribed period, in which case the penalty shall be the base fine for “Non-Filing” and the computation of the monthly penalty shall not exceed twelve (12) months; or iii. In case of SEC MC 28, submitting beyond thirty (30) calendar days from the issuance of the certificate of registration, license, or authority. c. Non-Filing means non-submission of the reportorial requirements. B. For Stock and Non-Stock Foreign Corporations a. Filed on Time means the punctual submission/registration of the reportorial requirements, as prescribed by the Commission: Reportorial Requirements Period to File / Register GIS Within thirty (30) calendar days from the anniversary date of the issuance of the SEC license. AFS Within one hundred twenty (120) calendar days from fiscal year-end or as prescribed by the Commission.

1 Not applicable to One Person Corporations

SEC MC 28 Upon filing up of the registration forms or within thirty (30) calendar days from the issuance of the certificate of registration, license, or authority. b. Late Filing means the submission of the reportorial requirements beyond the applicable period in Part I (2) (a) wherein its basic fine may be reckoned either from: i. The filing after thirty (30) calendar days from the anniversary date of the issuance of the SEC license for GIS or from the prescribed deadline for AFS; ii. The filing after sixty (60) calendar days from the anniversary date of the issuance of the SEC license for GIS or from the prescribed deadline for AFS, in which case the penalty shall be the base fine of “Non-Filing” and the computation of the monthly penalty shall not exceed twelve (12) months; 2or iii. In case of SEC MC 28, submitting beyond thirty (30) calendar days from the issuance of the certificate of registration, license, or authority. c. Non-Filing means non-submission of the reportorial requirements. -SCALES OF FINES AND PENALTIES ON THE NEXT PAGE-

2 SEC Memorandum Circular No.15-2006 - Guidelines on Compliance by Foreign Corporations with Reportorial and Monitoring Requirements. Please refer to the table on pages 8 to 13 for the difference in computation.

II. SCALES OF FINES AND PENALTIES The basis of computation of fines shall be the latest due submission of the GIS and/or AFS. Should there be non-submission of the GIS and/or AFS for the prior years, such GIS and/or AFS shall be considered as not filed and shall be assessed in accordance with this Circular. A. Late Filing of Reportorial Requirements for Domestic Stock and One Person Corporation VIOLATION BRACKET IMPOSABLE FINES – PER REPORT Late Filing of GIS and/or AFS Based on Retained Earnings/ Fund Balance / Equity First Offense3 Second Offense Third Offense Fourth Offense Fifth Offense Stock Corporations and One Person Corporation Capital Deficiency ₱5,000 ₱6,000 ₱7,000 ₱8,000 ₱9,000 Negative Retained Earnings (Deficit) ₱5,000 ₱6,000 ₱7,000 ₱8,000 ₱9,000 Plus ₱500 per month4 of delay Plus ₱500 per month of delay Plus ₱500 per month of delay Plus ₱500 per month of delay Plus ₱500 per month of delay ₱0 to ₱100,000 ₱5,000 ₱6,000 ₱7,000 ₱8,000 ₱9,000 Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay ₱100,001 to ₱500,000 ₱10,000 ₱12,000 ₱14,000 ₱16,000 ₱18,000 Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay ₱500,001 to ₱5,000,000 ₱15,000 ₱18,000 ₱21,000 ₱24,000 ₱27,000 Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay ₱5,000,001 to ₱10,000,000 ₱20,000 ₱24,000 ₱28,000 ₱32,000 ₱36,000 Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Above ₱10,000,000 ₱25,000 ₱30,000 ₱35,000 ₱40,000 ₱45,000 Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay

3 Companies shall be formally notified of their corresponding fines and penalties. For purposes of determining the frequency of violation, the number of settled notices with corresponding Confirmation of Payment will be considered, such that the counting of “First Offense” shall only set-in after the settlement of the initial notice. 4 A fraction of a month shall be considered a whole month. Moreover, the monthly penalty shall start from the prescribed due date of the reportorial requirement submission.

B. Late Filing of Reportorial Requirements for Domestic Non-Stock Corporation VIOLATIONS BRACKET IMPOSABLE FINES – PER REPORT Late Filing of GIS and/or AFS Based on Retained Earnings/ Fund Balance / Equity First Offense Second Offense Third Offense Fourth Offense Fifth Offense Non- Stock Corporations Negative Fund Balance/ Equity (Deficit) ₱5,000 ₱6,000 ₱7,000 ₱8,000 ₱9,000 Plus ₱500 per month of delay Plus ₱500 per month of delay Plus ₱500 per month of delay Plus ₱500 per month of delay Plus ₱500 per month of delay ₱0 to ₱100,000 ₱5,000 ₱6,000 ₱7,000 ₱8,000 ₱9,000 Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay ₱100,001 to ₱500,000 ₱7,500 ₱9,000 ₱10,500 ₱12,000 ₱13,500 Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay ₱500,001 to ₱5,000,000 ₱10,000 ₱12,000 ₱14,000 ₱16,000 ₱18,000 Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay ₱5,000,001 to ₱10,000,000 ₱12,500 ₱15,000 ₱17,500 ₱20,000 ₱22,500 Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Above ₱10,000,000 ₱15,000 ₱18,000 ₱21,000 ₱24,000 ₱27,000 Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay

C. Non-Filing of Reportorial Requirements for Domestic Stock Corporation and One Person Corporation VIOLATIONS BRACKET IMPOSABLE FINES – PER REPORT Non-Filing of Reportorial Requirements (GIS and/or AFS) Based on Retained Earnings / Fund Balance / Equity First Offense Second Offense Third Offense Fourth Offense Fifth Offense Stock Corporations and One Person Corporation Capital Deficiency ₱10,000 ₱12,000 ₱14,000 ₱16,000 ₱18,000 Negative Retained Earnings (Deficit) ₱10,000 ₱12,000 ₱14,000 ₱16,000 ₱18,000 Plus ₱500 per month of delay Plus ₱500 per month of delay Plus ₱500 per month of delay Plus ₱500 per month of delay Plus ₱500 per month of delay ₱0 to ₱100,000 ₱10,000 ₱12,000 ₱14,000 ₱16,000 ₱18,000 Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay ₱100,001 to ₱500,000 ₱15,000 ₱18,000 ₱21,000 ₱24,000 ₱27,000 Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay ₱500,001 to ₱5,000,000 ₱20,000 ₱24,000 ₱28,000 ₱32,000 ₱36,000 Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay ₱5,000,001 to ₱10,000,000 ₱25,000 ₱30,000 ₱35,000 ₱40,000 ₱45,000 Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Above ₱10,000,000 ₱30,000 ₱36,000 ₱42,000 ₱48,000 ₱54,000 Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay

D. Non-Filing of Reportorial Requirements for Domestic Non-Stock Corporation VIOLATIONS BRACKET IMPOSABLE FINES – PER REPORT Non-Filing of GIS and/or AFS Based on Retained Earnings / Fund Balance / Equity First Offense Second Offense Third Offense Fourth Offense Fifth Offense Non- Stock Corporations Negative Fund Balance/ Equity (Deficit) ₱10,000 ₱12,000 ₱14,000 ₱16,000 ₱18,000 Plus ₱500 per month of delay Plus ₱500 per month of delay Plus ₱500 per month of delay Plus ₱500 per month of delay Plus ₱500 per month of delay ₱0 to ₱100,000 ₱10,000 ₱12,000 ₱14,000 ₱16,000 ₱18,000 Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay ₱100,001 to ₱500,000 ₱12,500 ₱15,000 ₱17,500 ₱20,000 ₱22,500 Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay ₱500,001 to ₱5,000,000 ₱15,000 ₱18,000 ₱21,000 ₱24,000 ₱27,000 Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay ₱5,000,001 to ₱10,000,000 ₱17,500 ₱21,000 ₱24,500 ₱28,000 ₱31,500 Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Above ₱10,000,000 ₱20,000 ₱24,000 ₱28,000 ₱32,000 ₱36,000 Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay Plus ₱1,000 per month of delay

E. Late Filing of Reportorial Requirements for Foreign Stock Corporation VIOLATIONS BRACKET IMPOSABLE FINES – PER REPORT Late Filing of Reportorial Requirements (GIS and/or AFS) Based on Accumulated Income (AI) / Fund Balance / Members’ Equity First Offense Second Offense Third Offense Fourth Offense Fifth Offense Stock Corporations (Branch, Representative Office, ROHQ) Capital Deficiency ₱10,000 ₱12,000 ₱14,000 ₱16,000 ₱18,000 Negative Accumulated Income (Deficit) ₱10,000 ₱12,000 ₱14,000 ₱16,000 ₱18,000 Plus ₱500 late penalty* Plus ₱500 late penalty* Plus ₱500 late penalty* Plus ₱500 late penalty* Plus ₱500 late penalty* if filed after thirty (30) calendar days Plus ₱6,000 penalty Plus ₱6,000 penalty Plus ₱6,000 penalty Plus ₱6,000 penalty Plus ₱6,000 penalty if filed after sixty (60) calendar days ₱0 to ₱100,000 ₱10,000 ₱12,000 ₱14,000 ₱16,000 ₱18,000 Plus ₱1,000 late penalty Plus ₱1,000 late penalty* Plus ₱1,000 late penalty* Plus ₱1,000 late penalty* Plus ₱1,000 late penalty* if filed after thirty (30) calendar days Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty if filed after sixty (60) calendar days ₱100,001 to ₱500,000 ₱15,000 ₱18,000 ₱21,000 ₱24,000 ₱27,000 Plus ₱1,000 late penalty Plus ₱1,000 late penalty* Plus ₱1,000 late penalty* Plus ₱1,000 late penalty* Plus ₱1,000 late penalty* if filed after thirty (30) calendar days Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty if filed after sixty (60) calendar days ₱500,001 to ₱5,000,000 ₱20,000 ₱24,000 ₱28,000 ₱32,000 ₱36,000 Plus ₱1,000 late penalty Plus ₱1,000 late penalty* Plus ₱1,000 late penalty* Plus ₱1,000 late penalty* Plus ₱1,000 late penalty* if filed after thirty (30) calendar days Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty if filed after sixty (60) calendar days ₱5,000,001 to ₱10,000,000 ₱25,000 ₱30,000 ₱35,000 ₱40,000 ₱45,000 Plus ₱1,000 late penalty Plus ₱1,000 late penalty* Plus ₱1,000 late penalty* Plus ₱1,000 late penalty* Plus ₱1,000 late penalty* *if filed after thirty (30) calendar days

Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty if filed after sixty (60) calendar days Above ₱10,000,000 ₱30,000 ₱36,000 ₱42,000 ₱48,000 ₱54,000 Plus ₱1,000 late penalty* Plus ₱1,000 late penalty* Plus ₱1,000 late penalty* Plus ₱1,000 late penalty* Plus ₱1,000 late penalty* if filed after thirty (30) calendar days Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty if filed after sixty (60) calendar days F. Late Filing of Reportorial Requirements for Foreign Non-Stock Corporation VIOLATIONS BRACKET IMPOSABLE FINES – PER REPORT Late Filing of Reportorial Requirements (GIS and/or AFS) Based on Accumulated Income (AI) / Fund Balance / Members’ Equity First Offense Second Offense Third Offense Fourth Offense Fifth Offense Non-Stock (Branch, Representative Office, RHQ) Negative Accumulated Income (Deficit) ₱5,000 ₱6,000 ₱7,000 ₱8,000 ₱9,000 Plus ₱500 late penalty Plus ₱500 late penalty* Plus ₱500 late penalty* Plus ₱500 late penalty* Plus ₱500 late penalty* if filed after thirty (30) calendar days Plus ₱6,000 penalty Plus ₱6,000 penalty Plus ₱6,000 penalty Plus ₱6,000 penalty Plus ₱6,000 penalty if filed after sixty (60) calendar days ₱0 to ₱100,000 ₱5,000 ₱6,000 ₱7,000 ₱8,000 ₱9,000 Plus ₱1,000 late penalty Plus ₱1,000 late penalty* Plus ₱1,000 late penalty* Plus ₱1,000 late penalty* Plus ₱1,000 late penalty* if filed after thirty (30) calendar days Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty if filed after sixty (60) calendar days ₱100,001 to ₱500,000 ₱10,000 ₱12,000 ₱14,000 ₱16,000 ₱18,000 Plus ₱1,000 late penalty Plus ₱1,000 late penalty* Plus ₱1,000 late penalty* Plus ₱1,000 late penalty* Plus ₱1,000 late penalty* *if filed after thirty (30) calendar days Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty if filed after sixty (60) calendar days ₱15,000 ₱18,000 ₱21,000 ₱24,000 ₱27,000

₱500,001 to ₱5,000,000 Plus ₱1,000 late penalty* Plus ₱1,000 late penalty* Plus ₱1,000 late penalty* Plus ₱1,000 late penalty* Plus ₱1,000 late penalty* if filed after thirty (30) calendar days Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty if filed after sixty (60) calendar days ₱5,000,001 to ₱10,000,000 ₱20,000 ₱24,000 ₱28,000 ₱32,000 ₱36,000 Plus ₱1,000 late penalty Plus ₱1,000 late penalty* Plus ₱1,000 late penalty* Plus ₱1,000 late penalty* Plus ₱1,000 late penalty* if filed after thirty (30) calendar days Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty if filed after sixty (60) calendar days Above ₱10,000,000 ₱25,000 ₱30,000 ₱35,000 ₱40,000 ₱45,000 Plus ₱1,000 late penalty Plus ₱1,000 late penalty* Plus ₱1,000 late penalty* Plus ₱1,000 late penalty* Plus ₱1,000 late penalty* *if filed after thirty (30) calendar days Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty if filed after sixty (60) calendar days G. Non-Filing of Reportorial Requirements for Foreign Stock Corporation VIOLATIONS BRACKET IMPOSABLE FINES – PER REPORT Non-Filing of Reportorial Requirements (GIS and/or AFS) Based on Accumulated Income (AI) / Fund Balance / Members’ Equity First Offense Second Offense Third Offense Fourth Offense Fifth Offense Stock Corporations (Branch, Representative Office, ROHQ) Capital Deficiency ₱10,000 ₱12,000 ₱14,000 ₱16,000 ₱18,000 Negative Accumulated Income (Deficit) ₱10,000 ₱12,000 ₱14,000 ₱16,000 ₱18,000 Plus ₱6,000 penalty Plus ₱6,000 penalty Plus ₱6,000 penalty Plus ₱6,000 penalty Plus ₱6,000 penalty ₱0 to ₱100,000 ₱10,000 ₱12,000 ₱14,000 ₱16,000 ₱18,000 Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty ₱100,001 to ₱500,000 ₱20,000 ₱24,000 ₱28,000 ₱32,000 ₱36,000 Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty ₱500,001 to ₱5,000,000 ₱30,000 ₱36,000 ₱42,000 ₱48,000 ₱54,000 Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty ₱5,000,001 to ₱10,000,000 ₱40,000 ₱48,000 ₱56,000 ₱64,000 ₱72,000 Plus

₱12,000 penalty ₱12,000 penalty ₱12,000 penalty ₱12,000 penalty ₱12,000 penalty Above ₱10,000,000 ₱50,000 ₱60,000 ₱70,000 ₱80,000 ₱90,000 Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty H. Non-Filing of Reportorial Requirements for Foreign Non-Stock Corporation VIOLATIONS BRACKET IMPOSABLE FINES – PER REPORT Non-Filing of Reportorial Requirements (GIS and/or AFS) Based on Accumulated Income (AI) / Fund Balance / Members’ Equity First Offense Second Offense Third Offense Fourth Offense Fifth Offense Non- Stock Corporations (Branch, Representative Office, RHQ) Negative Accumulated Income (Deficit) ₱10,000 ₱12,000 ₱14,000 ₱16,000 ₱18,000 Plus ₱6,000 penalty Plus ₱6,000 penalty Plus ₱6,000 penalty Plus ₱6,000 penalty Plus ₱6,000 penalty ₱0 to ₱100,000 ₱10,000 ₱12,000 ₱14,000 ₱16,000 ₱18,000 Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty ₱100,001 to ₱500,000 ₱15,000 ₱18,000 ₱21,000 ₱24,000 ₱27,000 Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty ₱500,001 to ₱5,000,000 ₱20,000 ₱24,000 ₱28,000 ₱32,000 ₱36,000 Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty ₱5,000,001 to ₱10,000,000 ₱25,000 ₱30,000 ₱35,000 ₱40,000 ₱45,000 Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Above ₱10,000,000 ₱30,000 ₱36,000 ₱42,000 ₱48,000 ₱54,000 Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty Plus ₱12,000 penalty I. Late and Non-Compliance with MC 28, s. 2020 VIOLATION IMPOSABLE FINES Late Filing and Non-Compliance with MC 28, s. 2020 ₱20, 000

III. PENALTY CLAUSE Pursuant to Section 177 of the RCC, the SEC may declare a corporation under delinquent status in case of failure to submit reportorial requirements for three (3) times, consecutively or intermittently, within five (5) years. After a corporation is notified of its delinquent status, the commission of a sixth (6th) offense constitutes a ground for revocation of its Certificate of Registration/License to Transact Business in the Philippines or Secondary License5 and shall warrant the imposition of monetary fines equivalent to the fifth (5th) offense plus one hundred percent (100%) surcharge of the total assessed fine. IV. REVERSION OF PENALTY TO FIRST OFFENSE Upon the effectivity of this Memorandum Circular, corporations charged with higher imposable fines, i.e., second to fifth offense, may be penalized under the scale of penalty for the first offense, provided, they are found to be compliant with the submission of GIS and AFS for three (3) consecutive years immediately after the imposition of higher imposable penalties, i.e., due reports for the periods 2023 to 2025. The penalty for corporations who successfully availed of and were issued corresponding Confirmation of Payment of Amnesty Fees (COPs) but subsequently committed the same offense shall immediately be reverted to that applicable for the first offense. IV. REPEALING CLAUSE Any circular, rule or order earlier issued by the Commission that is inconsistent with any of the foregoing enumeration of violations, fines, and penalties shall be deemed wholly or partly superseded, repealed or amended by this Circular, as the case may be. V. EFFECTIVITY CLAUSE This Circular shall cover requests for monitoring received by the Commission on 1 April 2024. All requests for monitoring and inquiries related thereto shall only be done through the following email addresses/forms: HANDLING DEPARTMENT/OFFICE SPECIFICS EMAIL/LINK Company Registration and Monitoring Department (CRMD) – Compliance Monitoring Division (CMD) Request for Monitoring: Domestic Stock, Non-Stock, and One Person Corporations Domestic and One Person Corporations: Monitoring Request Form Link Company Registration and Monitoring Department (CRMD) – Compliance Monitoring Division (CMD) Request for Monitoring: Foreign Corporations Foreign Corporations: Monitoring Request Form Link Company Registration and Monitoring Department (CRMD) – Compliance Monitoring Division (CMD) Request for Status of Monitoring Request: Domestic Stock, Non-Stock, and One Person Corporations Company Registration and Monitoring Department (CRMD) – Compliance Monitoring Division (CMD) Request for Status of Monitoring Request: Foreign Corporations cmd_foreign_monitoring@sec.gov.ph

5 Based on the SEC Rules of Procedure, the department/office who has jurisdiction over its regulated entities has the authority to revoke the secondary licenses of these corporations. crmd_monitoring@sec.gov.ph

Corporate Governance and Finance Department (CGFD) General Request: All Supervised and Regulated Corporations of CGFD cgfd@sec.gov.ph Corporate Governance and Finance Department (CGFD) – Licensing Division (LD) Request for Monitoring: Investment Companies (mutual funds), Issuers of Proprietary and Non￾Proprietary Securities, Public Companies cgfd_ld@sec.gov.ph Corporate Governance and Finance Department (CGFD) - Corporate Governance Division (CGD) Request for Monitoring: Accredited Institutional Training Providers (ITPs), Publicly Listed Companies (PLCs) on Corporate Governance and Sustainability Reporting Matters cgfd_cgd@sec.gov.ph Corporate Governance and Finance Department (CGFD) – Monitoring, Compliance, and Audit Division (MCAD) Request for Monitoring: Foundations cgfd_fdn@sec.gov.ph Corporate Governance and Finance Department (CGFD) – Monitoring, Compliance, and Audit Division (MCAD) Request for Monitoring: Accredited Microfinance NGOs mnrc_secretariat@sec.gov.ph Financing and Lending Division (FinLenD) Request for Monitoring: Financing and Lending Corporations with Secondary License Request Slip via Google Forms Markets and Securities Regulation Department (MSRD) General Request: All Supervised and Regulated Corporations of MSRD msrdsubmission@sec.gov.ph msrd_mid@sec.gov.ph Bacolod Extension Office Request for Monitoring: Corporations under the jurisdiction of Bacolod Extension Office sec.bcdextension@gmail.com Baguio Extension Office Request for Monitoring: Corporations under the jurisdiction of Baguio Extension Office BAGEO Monitoring Request Form Link Cagayan de Oro Extension Office Request for Monitoring: Corporations under the jurisdiction of Cagayan de Oro Extension Office reports_cdo@sec.gov.ph Cebu Extension Office Request for Monitoring: Corporations under the jurisdiction of Cebu Extension Office CEBEO Monitoring Request Form Link Davao Extension Office Request for Monitoring: Corporations under the jurisdiction of Davao Extension Office secdavao.records@gmail.com Iloilo Extension Office Request for Monitoring: Corporations under the jurisdiction of Iloilo Extension Office sec_iloilo@sec.gov.ph Legazpi Extension Office Request for Monitoring: Corporations under the LEGEO Monitoring Request Form Link secbicol@sec.gov.ph

jurisdiction of Legazpi Extension Office Tarlac Extension Office Request for Monitoring: Corporations under the jurisdiction of Tarlac Extension Office secteo@sec.gov.ph Tacloban Extension Office Request for Monitoring: Corporations under the jurisdiction of Tacloban Extension Office TACEO Monitoring Request Form Link Zamboanga Extension Office Request for Monitoring: Corporations under the jurisdiction of Zamboanga Extension Office reports_zeo@sec.gov.ph Any requests for monitoring sent to email addresses other than above listed will no longer be entertained and only those coursed through the proper request forms will be processed. Done this 27 March 2024, Makati City, Philippines. For the Commission: EMILIO B. AQUINO Chairperson