SEC MC No. 11, Series of 2026 — Minimum Public Ownership Rules for Issuers of Shares of Stock to Be Listed on an Exchange

www.sec.gov.ph | imessagemo@sec.gov.ph https://linktr.ee/secphilippines SEC MEMORANDUM CIRCULAR NO. ___ Series of 2026 TO : ALL CONCERNED SUBJECT : MINIMUM PUBLIC OWNERSHIP RULES FOR ISSUERS OF SHARES OF STOCK TO BE LISTED ON AN EXCHANGE WHEREAS, Section 2 of the Securities Regulation Code (SRC) declares it a policy of the State to, among others, promote the development of the Philippine capital market and encourage the widest participation of ownership in enterprises; WHEREAS, Section 5 (b) of the SRC provides that the Commission has the power to formulate policies and recommendations on issues concerning the capital markets; WHEREAS, Section 8.1 of the SRC provides authority to the Commission to approve applications for registration of securities before being sold, offered for sale or distributed within the Philippines on the basis of the registration statement filed with the Commission; WHEREAS, Sections 12.1 and 12.2 of the SRC also authorize the Commission to prescribe the form, information and documents that shall be contained in any registration statement, to dispense with any of said requirements and to require additional information or documents; WHEREAS, Section 12.6 further authorizes the Commission to impose such terms and conditions as may be necessary or appropriate for the protection of investors before taking any action on a filed registration statement; WHEREAS, the public ownership of a company is determined through its public float; WHEREAS, global Initial Public Offering (IPO) activity remains uneven across regions, with overall listings still below the peak periods of previous market cycles; WHEREAS, in response to these conditions, several markets have adopted more facilitative regulatory approaches to reinvigorate domestic IPO activity, including rationalizing listing requirements, enhancing flexibility in free-float thresholds, and reducing compliance burdens for issuers without compromising investor protection; WHEREAS, the Philippines must remain competitive relative to peer markets in attracting companies to list, especially in a global environment where issuers may consider alternative venues for capital raising or delay their IPO plans when faced with stringent or inflexible regulatory thresholds; WHEREAS, the relatively low number of IPOs in recent years, together with emerging constraints in the domestic market’s absorptive capacity for large offerings, reflected in shifts in liquidity conditions, investor allocation patterns, and prevailing risk appetite, underscores the need to review and recalibrate minimum public ownership requirements to ensure that issuance thresholds are responsive to current market realities; 11

www.sec.gov.ph | imessagemo@sec.gov.ph https://linktr.ee/secphilippines WHEREAS, while the benefits of broader public ownership, including deeper liquidity, improved price discovery, reduced volatility, a more dispersed shareholding structure, and enhanced governance, remain vital to the development of the Philippine capital market, these must be balanced against the equally important objective of ensuring that the regulatory framework does not impose undue burdens that may discourage sizeable issuers from accessing public markets; WHEREAS, adopting a tiered minimum public ownership framework provides a proportionate and market-aligned approach that preserves the long-term benefits of adequate public float while addressing present-day constraints in demand absorption for large issuances, thereby supporting capital formation and encouraging more companies to pursue listing in the Philippines; WHEREAS, the SRC authorizes the Commission to issue rules and regulations to make effective the provisions of the SRC; NOW, THEREFORE, the Commission hereby issues and promulgates the following rules and regulations governing the public ownership requirement of companies intending to undertake initial public offering as part of the terms and conditions for the registration of securities.
Section 1 – Definition of Terms
A. Commission shall refer to the Securities and Exchange Commission.
B. Public Float shall refer to the portion of a company’s issued and outstanding common shares that are freely available and tradable in the market and are non-strategic in nature or those not meant for the purpose of gaining substantial influence on how the company is being managed. Significant shareholdings of 10% or more of the total issued and outstanding shares of the company are considered strategic and thus, excluded in the public float of the company.
C. Minimum Public Ownership (MPO) shall refer to the lowest allowable percentage
of Public Float of a Publicly Listed Company (PLC).
D. Exchange is an organized marketplace or facility, duly registered with the Commission, that brings together buyers and sellers, and executes trades of shares or stocks. E. Rules shall refer to these Rules and Regulations on MPO on Initial Public Offerings.
Section 2 – Coverage
Unless otherwise provided for by law, these Rules shall apply to any company applying for the registration of its shares of stock for the purpose of conducting an IPO. Said company shall herein be referred to as “covered company.”

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Section 3 – Minimum Initial Public Ownership Requirement
A. A covered company filing registration statement pursuant to Sections 8 and 12 of the SRC with the intention to list their shares for trading on an exchange shall apply for registration with a public float that meets minimum requirements provided below:
Expected Market Capitalization at the Time of Listing Minimum Initial Public Ownership Not exceeding PHP 500M 33% Over PHP 500M but not exceeding PHP 1B 25% (subject to a minimum offer size of PHP 165M) Over PHP 1B but not exceeding PHP 50B 20% (subject to a minimum offer size of PHP 250M) Over PHP 50B 15% (subject to a minimum offer size of PHP 10B) B. In cases involving issuers with exceptionally large expected market capitalization at the time of listing, the exchange may, upon a determination that market liquidity, investor protection, and orderly trading will not be impaired, endorse the application of a lower minimum initial public ownership requirement. Provided, that this subsection shall apply only to issuers with an expected market capitalization at the time of listing of not less than Two Hundred Billion Pesos (PHP 200,000,000,000). Provided, further, that such minimum initial public ownership shall in no case be lower than twelve percent (12%). Any endorsement under this subsection shall be subject to compliance with the guidelines and implementing rules to be promulgated by the exchange, which shall, at a minimum, prescribe:

1. Objective thresholds or criteria for determining eligibility under this subsection,
   including expected market capitalization, minimum offer size, or minimum number of shares held by the public;
2. Safeguards to ensure adequate liquidity, dispersion of ownership, and fair price
   discovery; and
3. Disclosure requirements to ensure transparency to investors.
   The exchange shall submit supplemental rules and guidelines, as may be necessary for the effective implementation of this Circular, to the Commission for approval.

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Section 4 – Maintenance and Post-Listing Minimum Public Ownership Requirement
A. A covered company shall, at all times, maintain a public ownership percentage equal to or greater than the prescribed minimum corresponding to its market capitalization at the time of listing, as follows:
Market Capitalization at the Time of Listing Minimum Maintaining Public Ownership Not exceeding PHP 50B 20% Over PHP 50B 15% Provided, that where a lower minimum initial public ownership was approved pursuant to Section 3(B), the minimum maintaining public ownership shall in no case be lower than the approved initial public ownership percentage. B. If the public ownership of a covered company falls below its prescribed minimum maintaining public ownership at any time after registration, such company shall bring the public float to the required level within a maximum period of six (6) months from the date of such fall.
C. Notwithstanding the quarterly public ownership report requirement of the exchange,
a covered company shall establish and implement an internal policy and procedure to monitor its public ownership and shall immediately report to the Commission within the next business day after determining that its public float has fallen below the required minimum. Further, a covered company shall submit to the Commission within ten (10) days after the knowledge about the deficiency in its public ownership, a time bound business plan describing the steps that the company will take to bring the public float to the required level within a maximum period of six (6) months from the date of such decline. D. A covered company shall submit to the Commission a Public Ownership Report and progress report on the submitted business plan within fifteen (15) days after the end of each month until such time that its public float reaches the required level. E. Companies who made their IPOs before the effectivity of these Rules shall be subject to the minimum maintaining public ownership percentage under the MPO rules in effect at the time of their listing. Notwithstanding Section 2 of this Circular, any breach of the applicable minimum maintaining public ownership requirement for all publicly-listed companies shall be governed by the reporting, remediation, and monitoring requirements under Sections 4(B), 4(C), and 4(D) hereof.

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Section 5 – Monitoring and Policy Review
The Issuer and the Underwriters shall submit a post-transaction report on the bookbuilding process within ten (10) days from the completion of the offer. The report shall include, at a minimum, a summary of investor demand by price and volume tiers, and such other information as may be necessary to evaluate the pricing and allocation outcomes of the offering. The report shall be treated as confidential supervisory information and may be submitted in aggregated and anonymized form. It shall be used by the Commission exclusively for market￾oversight purposes and for the periodic review and assessment of the appropriateness and effectiveness of the minimum public ownership policy and related regulatory requirements. The submission of such information shall not, in itself, give rise to pricing- or allocation￾related enforcement actions, except where material regulatory violations are identified.
Section 6 – Sanctions and Penalties for Non-Compliance
Non-compliance with any of the requirements and procedures herein shall subject a covered company to the administrative sanctions provided under Section 54 of the SRC, including the initiation of suspension and/or revocation proceedings against their Registration Statements pursuant to the pertinent provisions of the SRC, if warranted.
Section 7 – Repealing Clause
Any other existing Commission rule, circular, order, memorandum, or any part thereof, and such other rules approved by the Commission, that are inconsistent or in conflict with the foregoing are hereby repealed or modified accordingly.
Section 8 – Transitory Clause
The exchange is hereby given a period of three (3) months from the effectivity of these Rules within which to amend and update its listing rules, manuals, and other relevant regulations to ensure consistency and alignment with the provisions of this Circular.
Section 9 – Effectivity
These Rules shall take effect immediately following the completion of its publication in two (2) newspapers of general circulation in the Philippines. Done this __ February 2026 in Makati City, Philippines. For the Commission:
FRANCISCO ED. LIM
Chairperson
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