SEC ends decades-old minimum commission rule for stockbrokers

The Securities and Exchange Commission (SEC) has eliminated the minimum commission that stockbrokers can charge, revising a rule which has been in place for the last half century as it hopes to revive activity amid weak interest in stocks. 

This change, which will be implemented via SEC Memorandum Circular No. 7, allows brokers to freely determine their commissions, and ultimately benefit investors through the imposition of lower transaction fees. 

The adjustment reflects advancements in online trading technologies that offer more cost-efficient transaction methods. This also aligns the Philippines with other regions that have no such commission mandates, the corporate watchdog said. 

Over the past week, the Philippine benchmark index erased gains this year amid rising external risks and geopolitical tensions. 

“The SEC will continue to review existing rules and regulations to see areas where we can make improvements to achieve our goal of boosting the capital market.”

A 1977 resolution by the SEC previously set the broker’s commission at 1.5 percent.

Meanwhile, guidelines issued by the PSE prescribed a minimum commission

ranging from 0.25 percent to 0.05 percent of the value of a trade transaction.