By:
Ben O. de Vera - 04:50 AM October 31, 2019
To ensure that dirty money cannot enter the country through extractive
industries, the government requires mining and oil firms to disclose their
beneficial owners as mandated under a recent rule issued by the Securities and
Exchange Commission (SEC).
“Beneficial ownership
disclosure in the country is an enormous task, but we appreciate its value in
curbing illicit financial activities. We are glad that the SEC is with us in
this undertaking,” Assistant Finance Secretary Maria Teresa Habitan said in a
statement.
Habitan is also the alternate chair and focal person for the Philippine
Extractive Industries Transparency Initiative (PH-EITI) multistakeholder group.
Memorandum Circular No.
15, s. 2019 issued by the SEC in July required all registered stock and
nonstock Filipino-led corporations to disclose their beneficial owners by
submitting a revised general information sheet (GIS) that now included a
beneficial ownership declaration form, PH-EITI noted in a statement.
It defined “beneficial
owners” as the natural persons who ultimately owned or controlled or exercised
ultimate effective control over a corporation.
The beneficial
ownership declaration form, meanwhile, requires the following information:
complete name, nationality, percentage of ownership or voting rights,
residential address and tax identification number.
All domestic corporations must submit their GIS, which now included the
beneficial ownership declaration form, to the SEC yearly.
PH-EITI said MC 15
formed part of the government’s antimoney laundering drive.
“The PH-EITI, the government’s
transparency initiative for the extractive sector, required the reporting of
beneficial owners of mining and oil and gas companies in line with an
international campaign to counter or prevent the use of anonymous shell
companies to hide or launder money and conceal potential conflicts of interest
within the extractive sector,” it said.
On Oct. 18, the
Department of Finance-led PH-EITI and the Chamber of Mines of the Philippines
(COMP) held a workshop to discuss the SEC’s beneficial ownership rule, which
was attended by over 40 companies from the gas, oil and mining industries.
“There is a global
shift toward increased disclosure of beneficial owners, and COMP is committed
to taking a lead role in this direction through the PH-EITI. We see the benefits
of increased transparency in beneficial ownership—it enhances confidence in our
local companies, thereby helping improve the investment climate. More
importantly, it can help prevent corruption and illicit financial flows, and
can increase trust and accountability in the mining sector,” COMP executive
director Ronald Recidoro was quoted by the PH-EITI as saying.
Under the 2016 EITI
Standard, countries involved in EITI such as the Philippines must ensure that
all firms with participating interests in extractive assets should have had
disclosed beneficial ownership information by Jan. 1 next year, the EITI
website said.
“The deadline for these
disclosures highlights the need for greater cross-sectoral,
cross-jurisdictional collaboration between government agencies tasked to
implement beneficial ownership reforms,” the EITI said.
This is in line with
the goal to address corruption risks, avoid conflicts of interests for
politically exposed persons, improve the business climate, as well as prevent
use of shell firms to perpetrate bribery, illicit financial flows and money
laundering in the extractive sector, it added.
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