MANILA, Philippines — The Securities and Exchange Commission (SEC) is reinforcing efforts to build a more efficient and integrated short selling market in the country as it streamlines the securities borrowing and lending framework by centralizing administrative functions with the Philippine Stock Exchange.
The PSE will now serve as the sole reviewing and pre-clearing body for master securities lending agreements (MSLAs) and multilateral MSLAs under 2026 revised guidelines approved by the SEC.
According to the SEC, MSLAs serve as loan agreements for securities borrowing and lending (SBL) transactions in the capital market.
It said SBL involves the lending of securities from a lender’s portfolio to a borrower’s portfolio to support the latter’s trading activities, with the commitment to return said securities or equivalent to the lender on a determined future date.
SBL is seen paving the way for short selling in the Philippines.
The commission said the designation of the PSE as the sole reviewing and pre-clearing body removes the requirement for SEC pre-clearance and certification prior to registration with the Bureau of Internal Revenue (BIR).
It effectively reduces the MSLA registration processing timeline to five working days from the current seven working days, while pre-clearance for accession agreements will be completed within one working day.
The streamlined process likewise lowers compliance costs for market participants through the removal of the SEC processing and certification fee worth P5,030.
Further, the PSE will now act as a one-stop shop for applicants and regulators, managing the entire administrative cycle, including the receipt of documents and fees, coordination of reviews and the transmission of pre-cleared documents to the BIR.
The PSE will also handle the assignment of MSLA reference numbers for BIR registration purposes, a function previously performed by the SEC.
The SEC said copies of all endorsed and transmitted documents must be furnished to the commission for regulatory oversight and post-audit purposes, consistent with the SEC rules on securities borrowing and lending.