PSE tightens listing rules

MANILA, Philippines - The Philippine Stock Exchange (PSE) is tightening the guidelines on the listing of shares of a public company.

The operator of the country’s stock market has prescribed a specific timeline for the listing of company shares and the corresponding penalties.

“There is a need to amend the rule to include a specific period for compliance by listed companies and impose stricter sanctions for non-compliance,” the PSE said.

In a memorandum, the PSE started seeking public comments for the Proposed Implementing Guidelines for the Listing of Issued and Outstanding Shares.

Under its listing rules, all types of shares of a public firm should be listed in the stock exchange. However, the requirements are not clear on the timeline for the listing of the shares.

With the proposed guidelines, listed companies are required to file the listing application within certain periods.

“The said mandatory periods are sufficient to allow listed companies to prepare and gather the necessary documents to support athe filing of the appropriate listing application covering the relevant transaction,” the PSE said.

The leeway is also enough for listed firms to “comply with any prescribed periods as may be stipulated by law or regulation to actually issue and/or list the listed company’s shares,” the PSE said.

For private placements and swaps, the required period is within six months from the full payment and issuance of the shares to the subscribers. For stock dividends, the requirement is no later than five working days from the record date of the stock dividend declaration.

The PSE also tasked public companies that undertook stock rights offerings to list shares within 90 calendar days from the date of approval of the rights offering by the firm’s board of directors.

On follow-on public offering, expected listing is at least 30 calendar days prior to the proposed start of the offer period.

Underlying shares of convertible securities are required to be listed at least 30 calendar days prior to the start of the conversion or exercise period.

For stock option or purchase plans, the prescribed period is at least 30 calendar days prior to the start of the period allowing full availment by the eligible participants or optionees.

Failure to file the listing application within the prescribed period will result in the imposition of penalties, the PSE said.

For the first violation, erring firms will be slapped with P100,000 in penalties, which will increase to P150,000 for the second violation, a two-month trading suspension for the third offense, and delisting for the fourth violation.

An additional fine of P2,000 will be imposed for each trading day the offense continues until the offense, is rectified, the PSE said.