THIRTEENTH CONGRESS OF THE REPUBLIC 
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OF THE PHILIPPINES 
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First Regular Session 
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S E N A T E  
S. No. 
Introduced by Senator S. R. Osmeiia 1111 
EXPLANATORY NOTE 
Republic Act 8799, otherwise known as The Securities Regulation Code, 
was enacted is a landmark legislation seeking the achievement of a free market 
that is self-regulating. 
Among its objectives are: 1) to encourage wide 
participation of ownership in enterprises; 2) to enhance democratization of 
wealth; 3) to promote the development of capital market; 4) to ensure disclosure 
about securities; and 5) to minimize, if not totally eliminate insider trading and 
other devices and practices which distort the free market. 
Despite the noble intentions of the authors of this law, it has failed to 
create a more fair and vibrant market it envisioned. This bill seeks to provide the 
remedy by amending some of the provisions of RA 8799 to further remove the 
restrictions or enhance regulations that have impaired activity and development 
in the Philippine capital markets. 
In view of the foregoing, early passage of this bill is earnestly requested. 
PL 
SERGIO OSMENA ill 
Senator 
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THIRTEENTH CONGRESS OF THE REPUBLIC 
) 
OF THE PHILIPPINES 
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‘& &: 
1“2 14’ 
First Regular Session 
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S E N A T E  
S. No. 
Introduced by Senator S. R. Osmeiia 111 
AN ACT 
AMENDING REPUBLIC ACT NUMBERED EIGHT THOUSAND SEVEN 
HUNDRED NINETY NINE, OTHERWISE KNOWN AS “THE SECURITIES 
REGULATION CODE”, AND FOR OTHER PURPOSES 
Be it enacted by the Senate and House of Representatives of the Philippines in 
Congress assembled: 
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SECTION 1. Subsection 19.1 (a) and 19 (d) of Republic Act No. 8799, 
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otherwise known as the ‘Securities Regulation Code”, are hereby amended to 
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read as follows: 
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“Section 19. Tender Offers - 19.1. (a) Any person or group of 
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persons acting in concert who [intends to] acquires, THROUGH 
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PRIVATELY NEGOTIATED PURCHASESl at least [fifteen percent (I 
5%)] 
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THIRTY-FIVE PERCENT (35%) of any class of any equity security of a 
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listed corporation or of any class of any equity security of a corporation 
with assets of at least Fifty million pesos (P50,000,000.00) and having two 
hundred (200) or more stockholders with at least one hundred (100) 
shares each [or who intends to acquire at least thirty percent (30%) of 
such equity over a period of twelve (12) months,] shall make a tender offer 
to ALL THE OTHER. stockholders FOR THE REMAINDER OF. THE 
OUTSTANDING EQUITY SECURITIES OF THE CORPORATION IN 
ACCORDANCE WITH SUCH RULES AS THE COMMISSION MAY 
PRESCRIBE: PROVIDED, THAT A PERSON OR GROUP OF PERSONS 
WHO HAVE NOT MADE ANY PRIVATELY NEGOTIATED PURCHASES 
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OF THE EQUITY SECURITIES OF THE CORPORATION MAY MAKE A 
VOLUNTARY TENDER OFFER FOR LESS THAN ALL OF THE 
OUTSTANDING EQUIJY SECURJJJES OF THE CORPORATION IN 
ACCORDANCE WITH SUCH RULES AS THE COMMISSION MAY 
PRESCRIBE. THE PERSON OR GROUP OF PERSONS MAKING A 
TENDER OFFCER SHALL FILE [by filing] with the Commission a 
declaration to that effect, [and] furnish the issuer, a statement containing 
such of the information required in Section 17 of this Code as the 
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Commission may prescribe. [Such person group of persons shall] AND 
publish all requests or invitations for tender, or materials making a tender 
offer or requesting or inviting letters of such a security. Copies of any 
additional material soliciting or requesting such tender offers subsequent 
to the initial solicitation or request shall contain such information as the 
Commission may prescribe and shall be filed with the Commission and 
sent to the issuer not later than the time copies of such materials are first 
published or sent or given to security holders.’’ 
I‘X x x’, 
“(d) IN CASES OF VOLUNTARY TENDER OFFERS AND where the 
securities offered exceed that which a person or group of persons is 
bound or willing to take up and pay for, the securities that are subject of 
the tender offer shall be taken up as early as may be pro rata, 
disregarding fractions, according to the number of securities deposited by 
each depositor. The provisions of this subsection shall also apply to 
securities deposited within ten ( I O )  days after qotice of an increase in the 
consideration offered to security holders, as prescribed in paragraph (e) of 
this subsection, is first published or sent or given to security holders.” 
IiX x XI, 
“(d) IN CASES .OF VOLUNTARY TENDER 0FF.ERS AND where 
the securities offered exceed that which a person or group of persons is 
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bound or willing to take up and pay for, the securities that are subject of 
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the tender offer shall be taken up as early as may be pro rata, 
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disregarding fractions, according to the number of securities deposited by 
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each depositor. The provisions of this subsection shall also apply to 
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securities deposited within ten ( I O )  days after notice of an increase in the 
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consideration offered to security holders, as prescribed in paragraph (e) of 
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this subsection, is first published or sent or given to security holders.” 
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SEC. 2. Subsection 28.4 (b) of the same Act is hereby amended to read 
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as follows: 
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“Section 28. Registration of Brokers, Dealers, Salesmen and 
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Associated Persons. 
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“28.4. The Commission shall promulgate rules and regulations 
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prescribing the qualifications for registration for each category of applicant 
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which shall, among other things, require the condition for registration: x x x 
“(d) In the case of a broker or dealer, the applicant satisfy a 
minimum net capital AND OTHER CAPITAL ADEQUACY RATIOS as 
prescribed by the RELEVANT SELF-REGULATORY ORGANIZATION 
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[Commission], and provide a bond or other security as the SELF- 
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REGULATORY ORGANIZATION [Commission] may prescribe to secure 
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compliance with the provisions of this Code; and” 
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i‘x x x” 
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SEC. 3. Section 30.1 of the same Act is hereby amended to read as 
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follows: 
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“Section 30. Transactions and Responsibility of Brokers and 
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Dealers. - 30. I 
THE RELEVANT SELF-REGULATORY ORGANIZATION 
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SHALL ISSUE THE NECESSARY RULES AND REGULATIONS TO 
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ENSURE FULL DISCLOSURE OF TRANSACTIPNS OF A [no] broker or 
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dealer [shall deal in or otherwise’buy or sell, for its own account or for the 
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account of customers,] IN securities listed on an Exchange issued by any 
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corporation where any stockholder, director, OFFICER OR EMPLOYEE 
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OF SUCH BROKER OR DEALER I 
ALSO A STOCKHOLDER, 
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DIRECTOR, OFFICER OR EMPLOYE€ OF SUCH CORPORATION. 
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[associated person or salesman, or authorized clerk of said broker or 
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dealer and all of the relatives of the foregoing within the fourth civil degree 
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of consanguinity or affinity, is at the time holding office in said issuer 
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corporation as a director, president, vice-president, manager, treasurer, 
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comptroller, secretary or any office of trust and responsibility, or is a 
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controlling person of the issuer.”] 
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SEC. 4. Subsection 33.2 ( c) and (9 of the same Act are hereby amended 
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to read follows: 
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“33.2 Registration of an Exchange shall be granted upon 
‘Section 33. Registration 0fExchange.s. - 33. I x x x 
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compliance with the following provisions: x x x 
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‘(c ) Where the Exchange is organized as stock corporation, that no 
person may beneficially own or control, directly or indirectly, more than 
five person (5%) of the voting rights of the Exchange and no PERSON 
TOGETHER WITH ITS AFFILIATES OR RELATED PARTIES, [industry 
group or business group] may beneficially own or control, directly or 
indirectly, more than twenty person (20%) of the voting rights of the 
Exchange. Provided, however, That the Commission may adopt rules, 
regulations or issue an order, upon application, exempting an applicant 
from this prohibition where it finds that such ownership or control will not 
negatively impact on the exchange’s ability to effectively operate in the 
p uti I i c interest . 
‘‘X x XI1 
“( 9 That the brokers in the board of the Exchange shall comprise of not 
more than forty-nine percent (49%) of 
such board [and shall 
proportionately represent the Exchange membership in terms of volume/ 
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value of trade and paid up capital], and that any natural person associated 
with a juridical entity that is a member shall himself be deemed to be a 
member for this purpose: Provided, That any registered Exchange existing 
prior to the effectivity of this Code shall immediately comply with this 
requirement ; ” 
“x x XI’ 
SEC. 6. Section 34.1 of the same Act is hereby repealed and Sections 
34.2 and respectively. 
SEC. 7. Section of the same Act is hereby amended to read as follows: 
“Section 35. Additional Fees of Exchanges. - In addition to the 
registration fee prescribed in Section 33 of this Code, every Exchange 
shall pay to the Commission, on a semestral basis on or before the tenth 
day of the end of every semester of the calendar year, a fee in such an 
amount as the Commission shall prescribe, but not more than ONE FIVE 
HUNDREDTH [one-hundredth] of one per centrum (1”) of the aggregate 
amount of the sales of securities transacted on such Exchange during the 
preceding calendar year, for the privilege. of doing business during the. 
preceding calendar year or any part thereof.” 
SEC. 8. Section 36.3 of the same Act is hereby amended to read as 
follows: 
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“Section 36. Powers with Respect fo Exchanges and Other Trading 
Markets. - - x x x 
“36.3 In addition to the existing Philippine Stock Exchange, the 
Commission shall have the authority to determine the number size and 
location of stock Exchanges, other trading markets and commodity 
Exchanges and other similar organizations in the light of national or 
regional requirements for such activities with the view to promote, 
enhance, protect, conserve or rationalize investment [.I: PROVIDED, 
THAT ANY SECURITIES REGISTERED WITH THE COMMISSION AND 
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APPROVED FOR LISTING IN AN EXCHANGE SHALL NOT BE 
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DEEMED AUTOMATICALY LISTED IN ANY OTHER EXCHANGE.” 
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SEC. 9. This Act shall take effect fifteen (15) days after its complete 
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publication in at least two (2) national newspapers of general circulation 
Approved, 
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