Securities Regulation Code of the Philippines

Republic Act no. 8799

1. SECURITIES
REGULATION CODE
R.A. 8799

2. •EnactedonJuly19,2000
•Amendedin2015
•Dividedinto78sectionsandclassifiedinto13chapters

3. ✓Shares of stocks, bonds, debentures
✓Investment contracts
✓Options and warrants
✓Certificates (assignment, participation,
trust, etc.)
✓Proprietary and non-proprietary
membership certificates
✓Other instruments as may in the future be
determined by the Commission

4. corporations
Domestic governments Foreign governments
Investment trusts

5. BROKERS DEALERS
agents who
buy and
sell
securities
for others
buy and sell
securities
for
themselves

7. Objectives of Securities Regulation Code
To establish a
socially aware and
self-regulating free
market
To encourage
more participation
in owning an
enterprise
To enhance the
democratization
of wealth
To promote the
capital market’s
development
To protect investors
by ensuring full and
fair disclosure of
securities
To minimize or
eliminate fraudulent
activities such as
insider trading in the
free market

9. a person who has access to material
nonpublic information about the company or
the security that is not generally available to
the public
✓Management
✓Directors
✓Government agencies
✓other people who learn of such
information by communication from the
preceding persons

10. “information that has not been disclosed to the public and
would either likely affect the market price of the security
when disseminated to the public or would be an important
consideration by a reasonable man to either buy, sell or hold
certain security”

11. “trading security with the knowledge
of nonpublic material information.”
An insider may still trade if:
✓heprovesthattheinformationwasnot
gainedfromhisconnectionorfunction
✓heprovesthatthepersonhetransacts
withisawareofthenon-material
information

12. It is unlawfulfor any person:
❖Tocreatefalseormisleadingappearanceof
activetradeonanylistedsecurityinan
Exchangeoranyothermarket:
•Byeffectinganytransactioninsuchsecuritywhich
involvesnochangeinthebeneficialownership
•Byparticipatinginthesaleorpurchaseofsuch
securitywiththeinsiderknowledgeofotherinvolved
parties
•Byperformingsimilaractswherethereisnochangein
beneficialownership

13. ❖Tocirculateinformationthatthepriceofanysecuritylisted
inanExchangewillorislikelytoriseorfallbecauseof
manipulativemarketoperations
❖Toeffectaseriesoftransactionsinsecurities:
•Raisestheirpricetoinducethepurchaseofsecurity
•Depressestheirpricetoinducethesaleofasecurity
❖Tomakefalseormisleadingstatementswithrespectto
anymaterialfacttoinducethepurchaseorsaleofany
security

14. •Employanydevice,scheme,orartificetodefraud;
•Obtainmoneyorpropertybymeansofanyuntrue
statementofamaterialfactofanyomissiontostate
amaterialfactnecessaryinordertomakethe
statementsmade,inthelightofthecircumstances
underwhichtheyweremade,notmisleading;or
•Engageinanyact,transaction,practiceorcourseof
businesswhichoperatesorwouldoperateasafraud
ordeceituponanyperson.

15. ❑Paintingthetape
❑Markingtheclose
❑Impropermatchedorders
❑Washsales
❑Squeezingthefloat
❑Hypeanddump
❑Shortanddistort
❑Disseminatingfalseormisleadingmarketinformationthrough
media,includingtheinternet,oranyothermeanstomovethe
priceofasecurityinadirectionthatisfavorabletoapositionheld
oratransaction

16. “engaginginbuyingactivityatincreasingly
higherpricesandthensellingthesecurities
atahigherpriceinthemarket.”
agroupofpersonswillspikeupthesharepricebytrading
amongthemselves.Whenthepublicisalreadyenticedtobuy
thesecurity,hopingthatthepricewillgohigher,theperson
orgroupofpersonswillthendumpthesecuritytothe
public,atthealreadypumpeduphigherprice.

17. •fine of not less than P50,000nor more than
P5 million
•imprisonment of not less than seven years
nor more than 21 years, or both, for every
violation.

19. Shallnotbesoldorofferedforsaleordistributionwithinthe
Philippines,withoutaregistrationstatementdulyfiledwith
andapprovedbytheCommission.Priortosuchsale,
informationonsecuritymadeavailabletoeachprospective
purchaser.
Aprimarymeansofprotectingtheinvestingpublicisthe
disclosureoftheimportantfinancialinformationthrough
theregistrationofsecuritieswhichenablesinvestorsto
makeinformedjudgments.

20. Allcompanies,listedorapplyingforlisting,are
requiredtodivulgetruthfullyandaccurately,all
materialinformationaboutthemselvesandthe
securitiestheysellfortheprotectionoftheinvesting
publicpainofadministrative,criminalandcivil
sanctions

21. Section30preventedtheunfairuseofnon-
publicinformationinsecuritiestransactions
Section36monitorthetransactionsentered
bycorporateofficers/directorsregardsthe
securitiesoftheircompanies.
Promotefulldisclosureinthesecuritiesmarketand
preventunscrupulousindividuals,whobytheirpositions
obtainnon-publicinformationbytakingadvantageofthe
uninformedpublic.

23. 1)Falseregistrationstatement
2)Inviolationofregistrationrequirements
3)Fraudinconnectionwithsecuritiestransaction
4)Manipulationofsecurityprices
5)Commodityfuturescontractsandpre-needplans
6)Bymeanofprospectusorcommunicationwithuntruestatement
7)Insidertrading