Companies asked to disclose beneficial ownership 

The Securities and Exchange Commission (SEC) is advising corporations to disclose their beneficial ownership to prevent misuse of SEC-registered corporations' illegal activities, according to a report by Manila Times.

In a webinar conducted by the agency's Cebu Extension Office on Wednesday, Assistant Director Alfonso Lanuza Jr. of the SEC Enforcement and Investor Protection Department-Anti-Money Laundering Division said disclosure of the beneficial ownership information prevents the misuse of SEC-registered corporations for money laundering and terrorist financing purposes, among others.

At the same time, Lanuza said it ensures compliance with international best practices and standards in the prevention of money laundering and terrorist financing, and avoids being the Philippine getting included on the grey list or being considered as a high risk jurisdiction.

He stressed that all SEC-registered corporations required to submit the general information sheet (GIS) are also required to disclose their beneficial ownership information.

"So, there are two things, you are a SEC-registered corporation and you're required to submit the GIS. If one of these is not present, then you are not required, but if these two elements are present, then you are required to disclose your beneficial ownership information," Lanuza explained.

The SEC defines a beneficial owner as a natural person who ultimately owns or controls the corporation or exercises ultimate effective control over the corporation.

He noted that there are three bases to determine a company's beneficial owner, namely through ownership interest; control through other means; and control exercised through positions occupied in the company.

The commission also imposes penalties on corporations who fail to disclose their beneficial ownership information.

"The amount of the penalty is based on the amount of retained earnings or fund balance... It is proportionate to the size of the company. The bigger the company, the higher will be the penalty," Lanuza said.

In the same webinar, Lanuza also discussed other salient features of the SEC Memorandum Circular 15, Series of 2019 or the Revision of the GIS for Domestic Corporations to Include Beneficial Ownership Information.