The SEC earlier released a list of 11,677 corporations evaluated for possible suspension of their certificates of incorporation for failing to submit annual financial statements (AFS) and general information sheets (GIS) from 2015 to 2022.
Incentives offered
As mandated by Section 117 of the Revised Corporation Code (RCC) of the Philippines, all corporations must file AFS and GIS yearly. Failure to comply three times within five years may lead to a “delinquent” status, giving corporations two years to rectify their compliance or face revocation of registration.
To incentivize compliance, the SEC extended its ECIP program until Dec. 31, 2024. Non-compliant corporations can settle their fines for a flat rate of P20,000.
Suspended or revoked corporations can reduce their penalties by 50 percent, in addition to paying a P3,060 petition fee to lift suspension or revocation orders.
Higher penalties
Eligible firms must submit an Expression of Interest through the SEC’s Electronic Filing and Submission Tool (eFAST) and ensure their latest AFS and GIS are filed by the Dec. 31 deadline.
The SEC has also imposed updated penalty rates effective April 2024, which are significantly higher than previous fines. A corporation with retained earnings of up to P100,000 that delays filings for five months now faces penalties of P20,000—up from the prior rate of P1,000.
The SEC urges listed corporations to act promptly to avoid the suspension and new penalty structures. The list of affected entities is available on the SEC website.--Ed: CSN
