The Securities and Exchange Commission (SEC) has issued the final version of its tiered minimum public ownership (MPO) requirement for initial public offerings (IPOs), a move expected to entice major corporations such as GCash and Maya to list their shares locally rather than seek overseas bourses.

SEC Memorandum Circular (MC) No. 11, series of 2026, provides a tiered approach to public ownership requirements, calibrated to issuer size and designed to balance multiple policy considerations, including market liquidity, investor protection, capital formation, and overall market competitiveness.

“The new structure recognizes that the liquidity, valuation dynamics, and investor participation patterns of ‘small-cap’ and ‘mega-cap’ companies differ materially,” SEC Chairperson Francis Lim said.

He added, “By aligning public float requirements more closely with expected market capitalization at the time of listing, the commission ensures that rules remain proportionate, economically rational, and responsive to prevailing market conditions.”

“By recalibrating thresholds while maintaining minimum offer size safeguards and continuing compliance obligations, the SEC ensures that the domestic market remains competitive within the region, without compromising transparency, liquidity objectives, or investor protection standards,” Lim explained.

He stressed, “Investor protection remains central to the revised MPO policy. Retaining higher public float thresholds for smaller-cap companies counters their greater exposure to volatility and concentration risks. At the same time, maintaining minimum absolute offer sizes ensures that even companies benefiting from lower proportional thresholds contribute sufficient tradable shares to support liquidity and fair price formation.”

Under the new rules, firms with an expected market capitalization of ₱500 million or less upon listing will be required to have an initial public float of 33 percent. Tier two, covering firms valued at more than ₱500 million up to ₱1 billion, will need a public float of 25 percent or ₱165 million, while tier three, for companies worth more than ₱1 billion up to ₱50 billion, will be subject to a minimum float of 20 percent and at least ₱250 million.

Tier four, for companies valued at over ₱50 billion up to ₱150 billion, will have a minimum public float of 15 percent or at least ₱10 billion. Compared with the draft rules, the final version eliminated tier five, which applied to firms above ₱150 billion requiring a public float of 12 percent or ₱22.5 billion.

The final rules allow the exchange to approve a lower MPO requirement for issuers with exceptionally large market capitalization, provided the company’s market capitalization is at least ₱200 billion and the float is no less than 12 percent. The exchange will also issue guidelines to determine eligibility, minimum offer size, and required public shares, along with safeguards for liquidity, ownership dispersion, fair price discovery, and disclosure.

Globe Telecom Inc., parent of GCash, has lobbied for a lower MPO to avoid an offering size too large for the market to absorb, while rival Maya, part of PLDT Inc., is considering a $500-million to $1-billion IPO in the United States (US) to access deeper-pocketed investors and better valuations.

“The new MPO requirement is clearly intended to incentivize the IPO of large companies. The move stems from a realization that current market conditions require a lower public float so that it makes sense to list in the Philippines,” said Chinabank Capital Corp. managing director Juan Paolo Colet.

“Hopefully this makes it easier for GCash and Maya to consider doing their mega-IPOs in the Philippines. The rules could also facilitate the IPO of Land Bank of the Philippines (Landbank), as the government would be able to keep a larger stake in the bank,” he added.

Colet noted that regulators should balance the lower MPO with strong protections for public shareholders. “Moreover, the rule change should be seen as a temporary measure because the eventual goal should be to democratize wealth creation via increased public ownership,” he said.

COL Financial Group Inc. chief equity strategist April Lynn Tan said the new rules are positive for the market and could encourage GCash and Maya to push through with IPOs, though market sentiment remains a factor.

Reyes Tacandong & Co. senior adviser Jonathan Ravelas called the reforms “sensible and market-friendly,” noting that tiered MPO helps companies list without over-diluting early while protecting investors.

Unicapital Securities Inc. head of research Wendy B. Estacio-Cruz said the framework lowers listing barriers, making IPOs attractive for large, family-owned, and high-growth companies, while improving competitiveness versus regional peers. She added that firms still seeking premium valuations or aggressive regional expansion might favor overseas listings, but the PSE has become significantly more competitive for those prioritizing regulatory alignment, local brand positioning, and controlled dilution.