The Securities and Exchange Commission (SEC) has amended its rules by expressly including securities exempt from registration with the commission, such as government securities (GS), in the portfolio threshold requirements for qualified buyers.

The SEC said the amendment is aimed at promoting investment diversification and further streamlining regulations on the subject.

The commission last May 13 issued SEC Memorandum Circular (MC) No. 15, series of 2026, providing amendments to Rule 10.1.5 of the 2015 Implementing Rules and Regulations (IRR) of the Securities Regulation Code (SRC), as amended, which seek to align the requirements for qualified individual and institutional buyers.

“By refining the definition of qualified buyers and adopting a proportional regulatory approach, we aim to enable more investors to participate meaningfully in a wider range of investment opportunities, while maintaining appropriate safeguards,” SEC Chairperson Francis Lim said.

Qualified buyers are individuals or institutions with the financial capacity, as well as the investment knowledge and expertise, necessary to evaluate the risks associated with securities offerings exempt from registration.

Previously, and in contrast to the portfolio threshold for qualified buyers that are juridical persons, the 2015 SRC rule excluded instruments issued by the government from the portfolio investment threshold for natural persons.

Under the MC, securities exempt from registration under Section 9 of the SRC are now included in the total portfolio investment requirements for qualified buyers.

A natural person seeking to qualify as an individual buyer must have an annual gross income of at least ₱10 million for at least two years before registration, or a total portfolio investment in securities either registered with the SEC or exempt from registration under the SRC of at least ₱10 million.

A natural person must also have engaged in securities trading personally or through a fund manager for at least one year, or have held for at least two years a position of responsibility in any professional business entity that requires knowledge or expertise in securities trading.

Meanwhile, a juridical person, at the time of registration with an authorized registrar, must have gross assets of at least ₱100 million, or a total portfolio investment in securities registered with the commission or securities exempt from registration under the SRC of at least ₱60 million.

The amended rules also clarify that the assessment of financial capacity compliance for joint accounts or arrangements involving two or more beneficial owners or principals—whether through individual, corporate, trust, or similar structures—shall follow the ownership arrangement provided under SEC MC 10, series of 2018.

For both types of joint accounts, all parties must maintain compliance with the qualified buyer requirements, and accounts that lose such status will no longer be allowed to make subsequent purchases. - James A. Loyola