The 2006 Rules of

Procedure of the
Securities and Exchange
Commission

Securities Regulation Code (RA 8799),

Corporation Code of the Philippines (BP 68),
Presidential Decree 902-A, as amended,
Other related laws, and
Interest of a just, speedy and
inexpensive resolution of disputes and
complaints over which the SEC has
jurisdiction

Rule I

General
Provisions

Definition of
Terms
(Sec.1-2)

Commissioner
the Chairperson or any of the Commissioners

Chairperson: Teresita J. Herbosa

Commissioners: Manuel Huberto B. Gaite
Antonieta F. Ibe
Ephyro Luis B. Amatong
Blas James G. Viterbo

Operating
Department

refers to the
Company Registration and Monitoring
Department (CRMD),
Compliance and Enforcement Department
(CED),
Corporation Finance Department (CFD),
Market Regulation Department (MRD),
Non-Traditional Securities and Instruments
Department (NTD), and
Extension Offices (EOs)

CRMDs

Functions:

Registers corporations and partnerships;

Licenses (a) foreign companies to do
business in the Philippines; (b) investment,
and lending companies; and (c) investment
houses;
Processes applications for amendment of
articles
of
incorporation/
articles
of
partnership, by-laws, mergers and other
corporate activities that require the prior
approval of the Commission;
Handles petitions for correction of articles of
incorporation
and
by-laws
and
their
amendments, revocation of amended articles
of incorporation and amended by-laws and
revocation of certificates of incorporation for
non-compliance with reportorial requirements;
Monitors
compliance
by
registered
corporations
with
their
reportorial
responsibilities under the Corporation Code;
Maintains custody over documents it has
acted on or are directly filed with it, unless
otherwise directed by the En Banc;
Performs such other functions as may be
assigned by the En Banc or the Chairperson.

Operating
Department

refers to the
Company Registration and Monitoring
Department (CRMD),
Compliance and Enforcement Department
(CED),
Corporation Finance Department (CFD),
Market Regulation Department (MRD),
Non-Traditional Securities and Instruments
Department (NTD), and
Extension Offices (EOs)

CEDs

Functions:

ensures
compliance
by
all
market
participants, issuers and individuals, and
takes appropriate enforcement action against
them for legal infraction of the Code and other
relevant
laws,
rules
and
regulations
implemented by the Commission.

Operating
Department

refers to the
Company Registration and Monitoring
Department (CRMD),
Compliance and Enforcement Department
(CED),
Corporation Finance Department (CFD),
Market Regulation Department (MRD),
Non-Traditional Securities and Instruments
Department (NTD), and
Extension Offices (EOs)

CFDs

Functions:

Registers financing companies, equity

securities, bonds, mutual funds, real estate
investment trusts, exchange traded funds,
derivatives and other alternative investment
products;
Monitors and supervises compliance by (a)
financing companies; and (b) issuers of equity
securities and bonds, mutual funds, real
estate investment trusts, exchange-traded
funds, and other alternative investment
products with their legal and regulatory
requirements;
Monitors and supervises compliance by
covered persons and entities with corporate
governance rules and regulations, and
recommends policies and measures to
promote corporate governance;
Reviews activities of financial conglomerates
in relation to the foregoing matters and
coordinates
with
relevant
government
agencies when appropriate;
Maintains custody over documents it has
acted on or are directly filed with it, unless
otherwise directed by the En Banc;

Operating
Department

refers to the
Company Registration and Monitoring
Department (CRMD),
Compliance and Enforcement Department
(CED),
Corporation Finance Department (CFD),
Market Regulation Department (MRD),
Non-Traditional Securities and Instruments
Department (NTD), and
Extension Offices (EOs)

MRDs

Functions:

Registers and supervises Exchanges,

alternative trading systems, other trading
markets,
self
regulatory
organizations,
clearing agencies, securities lending agencies,
depositories, custodians, and other securitiesrelated organizations and participants;
Monitors and supervises brokers, dealers,
government
securities
eligible
dealers,
associated persons and salespersons of
brokers dealers, transfer agents, investment
houses, investment company advisers, mutual
fund distributors, compliance officers and
certified investment solicitors of investment
company advisers/mutual fund distributors,
and other securities market participants for
their compliance with legal and regulatory
requirements;

Operating
Department

refers to the
Company Registration and Monitoring
Department (CRMD),
Compliance and Enforcement Department
(CED),
Corporation Finance Department (CFD),
Market Regulation Department (MRD),
Non-Traditional Securities and Instruments
Department (NTD), and
Extension Offices (EOs)

MRDs

Functions:

Reviews the regulatory framework of the

securities industry and recommends reforms
where appropriate;
Establishes linkages with national and
international organizations and regulatory
agencies on regard to the securities market,
including cross-border activities;
Maintains custody over documents it has
acted on, or are directly filed with it, unless
otherwise directed by the En Banc;
Performs such other functions as may be
assigned by the En Banc or the Chairperson.

Operating
Department

refers to the
Company Registration and Monitoring
Department (CRMD),
Compliance and Enforcement Department
(CED),
Corporation Finance Department (CFD),
Market Regulation Department (MRD),
Non-Traditional Securities and Instruments
Department (NTD), and
Extension Offices (EOs)

NTDs

Functions:

Responsible for registration and licensing of

non-traditional securities and instruments
including but not limited to pre-need plans,
commodity futures contracts, proprietary or
non-proprietary membership certificates and
other similar instruments
Monitoring compliance with related rules and
endorsing
infractions
thereof
to
the
Compliance and Enforcement Department

Operating
Department

refers to the
Company Registration and Monitoring
Department (CRMD),
Compliance and Enforcement Department
(CED),
Corporation Finance Department (CFD),
Market Regulation Department (MRD),
Non-Traditional Securities and Instruments
Department (NTD), and
Extension Offices (EOs)

EOs

Locations:

Cebu
Iloilo
Davao
Cagayan De Oro
Baguio
Legaspi
Zamboanga
Tarlac

Operating
Department

refers to the
Company Registration and Monitoring
Department (CRMD),
Compliance and Enforcement Department
(CED),
Corporation Finance Department (CFD),
Market Regulation Department (MRD),
Non-Traditional Securities and Instruments
Department (NTD), and
Extension Offices (EOs)

Hearing Panel or Officers

Functions:

to hear and decide a case or complaint

Hearing Panel
or Officer

any officer, body or panel duly

designated or created through the
pertinent office order by the director or
OIC of an Operating Department or by
the Commission pursuant to these
Rules or by Resolution of the En Banc.
At least one member of the Hearing
Panel shall be a member of the
Philippine Bar

OGAs

Functions:

Acts as the lead office in the implementation

of
financial
reporting
standards
and
observance of auditing standards and
practices;
Prepares reply to accounting queries from the
public;
Accredits actuaries, valuators, external
auditors/auditing firms, appraisal companies
and credit rating agencies;
Monitors
compliance
by
external
auditors/auditing firms, appraisal companies
and credit rating agencies;
Evaluates financial statements of applicantcorporations
which
are
referred
by
Departments due to a material accounting
issue;
Renders advice to Departments upon
request, on accounting matters;
Evaluates applications and issues certificates
of eligibility under the Special Purpose Vehicle
law; and
Performs such other functions as may be
assigned by the En Banc or the Chairperson.

Office of the
General
Accountant
the office that advises, assists and
provides technical support to the
Commission and SEC Operating
Departments on issues relating to
accounting and auditing

OGCs

Functions:

Provides legal counsel to the En Banc and the

Departments;
Handles non-enforcement litigation, including
coordination with the Office of the Solicitor
General;
Assists in the preparation of comments on
proposed legislation referred to the En Banc,
including liaison with Congress;
Renders advice, upon request, on rulings
proposed to be issued by the Departments;
Prepares reply to legal queries from the
public;
Reviews opinions issued by the Departments,
as may be requested by the En Banc or a
Commissioner;
Supervises hearing panels and management
committees, and all activities relating to
rehabilitation, receivership and liquidation;
Reviews contracts;
Performs such other functions as may be
assigned by the En Banc or the Chairperson

Office of the
General
Counsel
the offices that advises and assists the
Commission and its Directors on legal
issues that may be brought before
them, and it may be assigned such
other functions as may be delegated
by the Commission En Banc

Constructio
n

(Sec.1-3)

Construction
The rules shall be liberally construed in
order to promote public interest and
assist the parties in obtaining a just,
expeditious
and
inexpensive
resolution,
settlement
and/or
disposition of all actions brought
before the Commission and to carry
out the objectives of the laws it is
mandated to implement.

Nature of
the

Proceeding
s
(Sec.1-4)

Nature of the
Proceedings
the proceedings before the Commission
shall be summary in nature and the
technical rules of evidence in the
regular
courts
shall,
whenever
practicable, be suppletory to these
Rules.
Note: subject to the requirements of due process

Venue of
the

Hearings
(Sec.1-5)

Venue of the Hearings

General Rule:
at the principal office of the SEC in Metro Manila
Exception:
a corporation, the principal office of which is located in a place
where the SEC has an EO, the action or the complaint may
be filed in the said EO
Exception to the exception:
provided that unless specified in the next following section or
when the Commission En Banc orders otherwise, the hearing
of the action shall be held at the principal office of the
Commission in Metro Manila.

Jurisdiction of
Operating
Departments,
Extension Offices
and Special
Offices over cases
filed before the

Commission
(Sec.1-6)

Jurisdiction of Operating
Departments, Extension
Offices and Special Offices
over cases filed before the
Commission
The ODs, EOs, and SOs shall take jurisdiction
over cases in accordance with their respective core
functions.

Assignment
of

Cases
(Sec.1-7)

Assignment of Cases
All actions filed with the Commission shall be assigned to a
Hearing Panel or Officer duly designated by the Director or
OIC of the OD which has jurisdiction over them, as the case
may be, unless otherwise determined by the Commission En
Banc.

Rule II
Who May
Be Parties

Who may be Parties

Sec. 2-1, R.2, RoPSEC only
natural or juridical persons or
entities authorized by law or a
party in interest acting through
an
attorney-in-fact,
where
applicable, may be parties to
any
action
before
the
Commission.

Sec. 1, R.3, RoC Only natural or

juridical persons, or entities
authorized by law may be
parties in a civil action. The
term "plaintiff" may refer to the
claiming party, the counterclaimant, the cross-claimant, or
the third (fourth, etc.) party
plaintiff. The term "defendant"
may refer to the original
defending party, the defendant
in a counter-claim, the crossdefendant, or the third (fourth,
etc.) party defendant.

Who may be Parties

Sec. 2-1, R.2, RoPSEC only
natural or juridical persons
or entities authorized by
law or a party in interest acting
through
an
attorney-in-fact,
where applicable, may be
parties to any action before the
Commission.

Sec. 1, R.3, RoC Only natural

or juridical persons, or
entities authorized by law
may be parties in a civil action.
The term "plaintiff" may refer to
the claiming party, the counterclaimant, the cross-claimant, or
the third (fourth, etc.) party
plaintiff. The term "defendant"
may refer to the original
defending party, the defendant
in a counter-claim, the crossdefendant, or the third (fourth,
etc.) party defendant.

Who may be Parties

Sec. 2-1, R.2, RoPSEC only
natural or juridical persons or
entities authorized by law or a
party in interest acting
through an attorney-in-fact,
where applicable, may be
parties to any action before the
Commission.

Sec. 1, R.3, RoC Only natural or

juridical persons, or entities
authorized by law may be
parties in a civil action. The
term "plaintiff" may refer to the
claiming party, the counterclaimant, the cross-claimant, or
the third (fourth, etc.) party
plaintiff. The term "defendant"
may refer to the original
defending party, the defendant
in a counter-claim, the crossdefendant, or the third (fourth,
etc.) party defendant.

Parties in Interest
Sec. 2-1, R.2, RoPSEC All
actions
filed
with
the
Commission must be pursued
and defended in the name of
the real party in interest. All
persons who have an interest in
the subject of an action and in
obtaining the relief demanded
shall be joined as complainants.
All persons who claim an
interest in the controversy or
the subject thereof which
adverse
to
that
of
the
complainant, or is necessary for
a
complete
resolution
or
settlement of the action shall
be joined as respondents.

Sec. 2, R.3, RoC A real party in

interest is the party who stands
to be benefited or injured by
the judgment in the suit, or the
party entitled to the avails of
the suit. Unless otherwise
authorized by law or these
Rules, every action must be
prosecuted or defended in the
name of the real party in
interest.

Parties in Interest
Sec. 2-1, R.2, RoPSEC All
actions
filed
with
the
Commission
must
be
pursued and defended in
the name of the real party
in interest. All persons who
have an interest in the subject
of an action and in obtaining
the relief demanded shall be
joined as complainants. All
persons who claim an interest
in the controversy or the
subject thereof which adverse
to that of the complainant, or is
necessary
for
a
complete
resolution or settlement of the
action shall be joined as

Sec. 2, R.3, RoC A real party in

interest is the party who stands
to be benefited or injured by
the judgment in the suit, or the
party entitled to the avails of
the suit. Unless otherwise
authorized by law or these
Rules, every action must be
prosecuted or defended in
the name of the real party
in interest.

Parties in Interest
Sec. 2-1, R.2, RoPSEC All
actions
filed
with
the
Commission must be pursued
and defended in the name of
the real party in interest. All
persons
who
have
an
interest in the subject of an
action and in obtaining the
relief demanded shall be
joined as complainants. All
persons
who
claim
an
interest in the controversy
or the subject thereof which
adverse to that of the
complainant, or is necessary
for a complete resolution or
settlement of the action

Sec. 2, R.3, RoC A real party

in interest is the party who
stands to be benefited or
injured by the judgment in
the suit, or the party
entitled to the avails of the
suit.
Unless
otherwise
authorized by law or these
Rules, every action must be
prosecuted or defended in the
name of the real party in
interest.

Intervention
Sec. 2-3, R.2, RoPSEC A natural or juridical person may,

Sec. 1, R.19, RoC A person who

at any stage of the proceedings, be permitted by the

HP/O to intervene in an action or complaint if he has a
legal interest therein or when he is so situated as to be
adversely affected by the decision of the Commission.
The said party may file a motion to intervene or oppose
the subject action before the HP/O stating therein the
reason for his intervention or opposition.
The motion should contain all the relevant supporting
documents and, if allowed, shall be treated as a
complaint-in-intervention. The HP/O may require the
original parties to the action to comment or answer on
the intervention as the case may warrant or require
them to submit their arguments against it in their
position papers or memoranda prior to the submission
of the action for resolution.
An answer to the intervention, when required by the HP/O,
should be filed within five (5) days from receipt of the
corresponding order.

has a legal interest in the matter

in litigation, or in the success of
either of the parties, or an
interest against both, or is so
situated as to be adversely
affected by a distribution or
other disposition of property in
the custody of the court or of an
officer thereof may, with leave of
court, be allowed to intervene in
the action. The court shall
consider whether or not the
intervention will unduly delay or
prejudice the adjudication of the
rights of the original parties, and
whether or not the intervenor's
rights may be fully protected in a
separate proceeding

Intervention Who may

Intervene
Sec. 2-3, R.2, RoPSEC A natural or juridical person

Sec. 1, R.19, RoC A person who

may, at any stage of the proceedings, be permitted by

the HP/O to intervene in an action or complaint if he
has a legal interest therein or when he is so
situated as to be adversely affected by the
decision of the Commission.
The said party may file a motion to intervene or oppose
the subject action before the HP/O stating therein the
reason for his intervention or opposition.
The motion should contain all the relevant supporting
documents and, if allowed, shall be treated as a
complaint-in-intervention. The HP/O may require the
original parties to the action to comment or answer on
the intervention as the case may warrant or require
them to submit their arguments against it in their
position papers or memoranda prior to the submission
of the action for resolution.
An answer to the intervention, when required by the HP/O,
should be filed within five (5) days from receipt of the
corresponding order.

has a legal interest in the

matter in litigation, or in the
success of either of the
parties,
or
an
interest
against
both,
or
is
so
situated as to be adversely
affected by a distribution or
other disposition of property
in the custody of the court or
of an officer thereof may, with
leave of court, be allowed to
intervene in the action. The
court shall consider whether or
not the intervention will unduly
delay
or
prejudice
the
adjudication of the rights of the
original parties, and whether or
not the intervenor's rights may
be fully protected in a separate
proceeding

Intervention Period to
Intervene
Sec. 2-3, R.2, RoPSEC A natural or juridical person may,

at any stage of the proceedings, be permitted by

the HP/O to intervene in an action or complaint if he
has a legal interest therein or when he is so situated as
to be adversely affected by the decision of the
Commission.
The said party may file a motion to intervene or oppose
the subject action before the HP/O stating therein the
reason for his intervention or opposition.
The motion should contain all the relevant supporting
documents and, if allowed, shall be treated as a
complaint-in-intervention. The HP/O may require the
original parties to the action to comment or answer on
the intervention as the case may warrant or require
them to submit their arguments against it in their
position papers or memoranda prior to the submission
of the action for resolution.
An answer to the intervention, when required by the HP/O,
should be filed within five (5) days from receipt of the
corresponding order.

Sec. 2, R.19, RoC The motion

to intervene may be filed at any

time before rendition of
judgment by the trial court. A
copy
of
the
pleading-inintervention shall be attached to
the motion and served on the
original parties.

Intervention Period to
Answer
Sec. 2-3, R.2, RoPSEC A natural or juridical person may,

at any stage of the proceedings, be permitted by the

HP/O to intervene in an action or complaint if he has a
legal interest therein or when he is so situated as to be
adversely affected by the decision of the Commission.
The said party may file a motion to intervene or oppose
the subject action before the HP/O stating therein the
reason for his intervention or opposition.
The motion should contain all the relevant supporting
documents and, if allowed, shall be treated as a
complaint-in-intervention. The HP/O may require the
original parties to the action to comment or answer on
the intervention as the case may warrant or require
them to submit their arguments against it in their
position papers or memoranda prior to the submission
of the action for resolution.
An answer to the intervention, when required by the HP/O,
should be filed within five (5) days from receipt of
the corresponding order.

Sec. 4, R.19, RoC The answer

to the complaint-in-intervention
shall be filed within fifteen
(15) days from notice of the
order admitting the same,
unless a different period is fixed
by the court.