SEC expands list of qualified buyers of securities

Published April 17, 2021, 7:00 AM

by James A. Loyola

The Securities and Exchange Commission (SEC) is expanding the list of entities deemed as qualified buyers of securities in the proposed amendments to the 2015 Implementing Rules and Regulations (IRR) of the Securities Regulation Code (SRC).

Rule 10.1 of the SRC IRR enumerates the list of qualified buyers. 

Under the proposed amendment, the Commission shall consider as qualified buyers registered securities dealers, accounts managed by a registered broker under a discretionary arrangement, and registered investment companies, such as mutual fund companies. 

This is in addition to the current list of qualified buyers, which includes banks, registered investment houses, insurance companies, and pension funds or retirement plans maintained by the government.

The list of qualified buyers shall also include provident funds or pension funds maintained by a government agency or by a government or private corporation and managed by an entity authorized accordingly by the BSP or SEC, as well as a trust corporation that is authorized by the BSP to perform the acts of a trustee, among others. 

Additionally, the following entities will be deemed qualified buyers: pre-need company authorized by the Insurance Commission; authorized collective investment schemes; a listed entity that engages the service of a professional fund manager; and a foreign entity that, if established or incorporated in the Philippines, would be covered by the enumeration. 

The Commission may also determine as qualified buyers, by rule or order, such other persons on the basis of such factors as financial sophistication, net worth, knowledge, and experience in financial and business matters, or amount of assets under management.

The proposed amendments also aim to reflect in SRC IRR Rule 9 provisions on the list of securities exempt from registration. 

Furthermore, the proposed amendments will allow the SEC to add to the list of exempt securities through the issuance of an order, in addition to the implementation of a rule or regulation after public hearing. 

The SEC released the proposed amendments on its website for public comment. All interested parties may submit their comments on the proposed amendments not later than April 20 to the Markets and Securities Regulation Department located on the Ground Floor, Secretariat Building, PICC Complex, Pasay City.

Comments may likewise be emailed at [email protected],[email protected], and [email protected]

 
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