Foreign retailers need to register with SEC

MANILA, Philippines — The Securities and Exchange Commission (SEC) has warned companies owned by foreign nationals that they need to register with the agency before starting local operations.

In an advisory, the SEC said that it has been receiving reports there are entities, wholly or partly owned by foreign nationals, engaging in retail trade without the proper registration from the SEC or acting beyond the authority granted in their Articles of Incorporation in violation of Republic Act 8762 or the Retail Trade Liberalization Act of 2000.

 The SEC reminded foreign-owned entities that under RA 8762, which allowed the entry of foreign retailers in the country, retail trade enterprises with paid-up capital of less than $2.5 million are exclusively reserved for Filipino citizens.

It said that full foreign participation has prescribed conditions.

“Full foreign participation is allowed only if any of the following qualifications is met: with paid-up capital of $2.5 million or more provided that investments for establishing a store is not less than $830,000; or specializing in high end or luxury products, provided that the paid up capital per store is not less than $250,000,” the SEC said in an advisory.

The SEC is referring to entities that are habitually selling direct to the general public merchandise, commodities or goods for consumption.

Violators will be penalized, the corporate regulator warned.

“Section 12 of RA 8762 provides that any person who shall be found guilty of violation of any provision of the Act shall be punished by imprisonment of not less than six years and one day but not more than eight years and a fine of not less than P1 million but not more P20 million. In the case of associations, partnerships or corporations, the penalty shall be imposed upon its partners, president, directors, managers and other officers responsible for the violation,” the SEC said.