SEC issues revised rules for beneficial ownership declaration

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December 24, 2025 | 12:00am

MANILA, Philippines — The Securities and Exchange Commission (SEC) is strengthening efforts to prevent the misuse of corporate entities for illicit activities, with the issuance of a revised regulatory framework aimed at improving the accuracy and timeliness of corporate beneficial ownership (BO) disclosures.

SEC Memorandum Circular 15, Series of 2025, which will take effect on Jan. 1, 2026, sets out the beneficial ownership disclosure rules of 2026 and consolidates existing SEC regulations governing the submission of BO information.

“Strengthening transparency in beneficial ownership is a key regulatory reform to reduce the risk of corporate entities being misused for illicit activities,” SEC chairperson Francis Lim said.

“The 2026 rules streamline existing disclosure processes and allow the commission to make better use of structured, high-quality data, ensuring that authorized authorities can access reliable and timely information for lawful purposes,” he said.

The 2026 rules provide verification mechanisms to validate BO information and address discrepancies; controlled access by authorized parties, subject to applicable laws and safeguards; and a 20 percent reporting threshold, in accordance with rules issued by the Anti-Money Laundering Council.

The rules also strengthen disclosure requirements, mandate nominee reporting and impose timely change notifications. They further lay the foundation for an online registry to facilitate the submission of BO data.

The rules apply to domestic and foreign corporations, partnerships and one-person corporations (OPCs) under the jurisdiction of the SEC, including relevant officers, shareholders and other covered persons.

Under the rules, beneficial owners are classified into Categories A to I, based on ownership interests and various forms of control or influence over a corporation.

Category A covers natural persons who own, directly or indirectly through a chain of ownership, at least 20 percent of the voting rights, voting shares or capital of the reporting corporation.

The other categories classify beneficial owners based on their exercise of control over the reporting entity, the ability to elect a majority of the board of directors/trustees and if they exert dominant influence in conducting the affairs of the corporation, among others.

The SEC said that beneficial owners’ identifying and contact information necessary to establish beneficial ownership, as prescribed under the rules and the date the individual became a beneficial owner, among others, should be disclosed.

The commission may also require companies to submit additional documents related to the BO declaration, as part of its visitorial powers and authority under Section 178 of the Revised Corporation Code of the Philippines.

Further, the 2026 rules lay the groundwork for the establishment of an online platform dedicated to the submission of beneficial ownership data.

All BO disclosures are required to be submitted through a new web-based registry.

The submission of BO information through the new registry will commence upon the SEC’s formal announcement that the BO registry is fully operational.

The SEC said that the new system does not impose an entirely new reporting requirement, but further enhances and streamlines the existing process for BO disclosure.

Upon initial submission through the registry, corporations will only be required to attest to the accuracy of their previously submitted beneficial ownership information on an annual basis, unless there are changes in the beneficial ownership structure, which must be reported accordingly.

Penalties for companies that fail to disclose their beneficial owners are based on their retained earnings or fund balance.

Stock corporations with retained earnings of less than P500,000 may be subjected to a fine of P50,000 for the first violation, and up to P500,000 for the fourth violation.

Non-stock corporations with the same fund balance may likewise be subjected to a fine of P25,000 for the first violation and up to P250,000 for the fourth violation.

The submission of false BO information, meanwhile, may subject the corporation to a fine of up to P2 million and potential dissolution.

Further, the directors, trustees and/or officers of the reporting corporation who fail to exercise the due diligence required in the disclosure may be subjected to a fine of P50,000 for the first violation, which could reach up to P1 million for a fourth violation, after due notice and hearing.

In cases of false declaration, the responsible officers may be subjected to a fine of up to P1 million and may be disqualified to be directors, trustees and officers of any corporation for a period of five years.