AMENDING FURTHER SECTIONS 2, 3, 5, 6, AND 8 OF PRESIDENTIAL DECREE NO. 902-A

• Number: Presidential Decree No. 1758
• Sections: 11

Preamble

WHEREAS, one of the objectives of the government as

envisioned under Presidential Decree No. 902-A, as amended by P. D. 1653, is to

attract and to mobilize investments, domestic and foreign, through the

participation of private enterprises in activities identified as most

contributive to the growth of the national economy;

WHEREAS, in order to attain this national objectively it is

incumbent upon government to provide a favor-role climate for investments to be

vigorously mobilized to insure a wider and more meaningful equitable

distribution of wealth;

WHEREAS, being the principal agency of the government

charged with the establishment of the needed atmosphere in all phases of the

country's economic and industrial development, the Securities and .Exchange

Commission must be provided with the appropriate organizational

structure, financial support and manpower capabilities commensurate with the

scope of its tasks; and

WHEREAS, for these programs to succeed, there is now a

pressing need to restructure the Securities and Exchange Commission not only to

make it a more potent, responsive and effective arm of the government but to

enable it to play a more effective role in the socio-economic development of the

country;

NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the

Republic of the Philippines, by virtue of the powers vested in me by the

Constitution, and the authority vested in me by Presidential Decree No. 1416, do

hereby order and decree;

Section 1

SECTION 1. The first and second paragraphs of Section 2 of

Presidential Decree No. 902-A, as amended by Presidential Decree No. 1653, is

hereby further amended to read as follows:

"SEC. 2. That the Commission shall be a collegial body

composed of a Chairman and four (4) Associate Commissioners who shall be

appointed by the President and the term of office of each member shall be seven

(7) years; Provided, however, That the Chairman and the two Associate

Commissioners of the Commission first appointed by the President shall serve for

a period of seven (7) years; five (5) years and three (3) years as continue in

Office in accordance with the terms fixed in their current respective

appointments, and the two additional Associate Commissioners first appointed by

the President under this Decree, as amended, shall serve for five (5) years and

three (3) years as fixed in their respective appointments; Provided,

further, That upon the expiration of his term, a member shall serve as such

until his successor shall have been appointed and qualified; and Provided,

finally, That no vacancy shall be filled except for the unexpired portion

of the term.

The Commission shall meet as often as may be necessary on such day or days as

the Chairman may fix. The notice of the meeting shall be given to all members of

the Commission and the presence of at least three (3) shall constitute a quorum.

In the absence of the Chairman, the more senior Associate Commissioner shall act

as presiding officer of the meeting.”

Section 2

SEC. 2. Section 3 of the same Presidential Decree, as

amended by Presidential Decree No. 1653, is hereby further amended to read as

follows:

"SEC. 3. The Commission shall have absolute jurisdiction,

supervision and control over all corporations, partnerships or associations, who

are the grantees of primary franchises and/or a license or permit issued by the

government to operate in the Philippines, and in the exercise of its authority,

it shall have the power to enlist the aid and support of and to deputize any and

all enforcement, agencies of the government, civil or military as well as any

private institution, corporation, firm, association or person."

Section 3

SEC. 3. Section 5 of the same Presidential Decree is hereby

amended by adding thereunder sub-paragraph (d) to read as follows:

“d) Petitions of corporations, partnerships or association to be declared in

the state of suspension of payments in cases where the corporation, partnership

or association possesses sufficient property to cover all its debts but foresees

the impossibility of meeting them when they respectively fall due or in cases

where the corporation, partnership or association has no sufficient assets to

coyer its liabilities, but is under the management of a Rehabilitation Receiver

or Management Committee created pursuant to this Decree."

Section 4

SEC. 4. Sub-paragraph c), d), h) and m) of Presidential

Decree No. 902-A, as amended by Presidential Decree No. 1653, is hereby further

amended to read as follows:

"c) To appoint one or more receivers of the property, real and personal,

which is the subject of the action pending before the Commission in accordance

with the pertinent provisions of the Rules of Court in such other cases whenever

necessary in order to preserve the rights of the parties-litigants and/or

protect the interest of the investing public and creditors. Provided,

however, that the Commission may, in appropriate cases, appoint a

Rehabilitation Receiver who shall have, in addition to the powers of a regular

receiver under the provisions of the Rules of Court, such functions and powers

as are provided for in the succeeding paragraph d) hereof.

Provided, further, that upon appointment ox a management committee,

rehabilitation receiver, board or body, pursuant to this Decree, all actions for

claims against corporations, partnerships or associations under management or

receivership pending before any court, tribunal, board or body shall be

suspended accordingly,"

"d) To create and appoint a management committee, board, or body upon

petition or motu propio to undertake the management of corporations,

partnerships or other associations in appropriate cases when there is imminent

danger of dissipation, loss, wastage or destruction of assets or other

properties or paralization of business operations of such corporations or

entities which may be prejudicial to the interest of minority stockholders,

parties-litigants or the general public.

The management committee or rehabilitation receiver, board or body shall have

the power to take custody of and control over, all the existing assets and

property of such entities under management to evaluate the existing, assets and

liabilities, earnings and operations of such corporations, partnerships or other

associations; to determine the best way to salvage and protect the interest of

the investors and creditors; to study, review and evaluate the feasibility of

continuing operations and restructure and rehabilitate such entities if

determined to be feasible by the Commission. It shall report and be responsible

to the Commission until dissolved by order of the Commission. Provided,

however, That the Commission, may, on the basis of the findings and

recommendation of the management committee, of rehabilitation receiver, board or

body, or on its own findings, determine that the continuance in business or such

corporation or entity would not be feasible or profitable nor work to the best

interest of the stockholders, parties-litigants, creditors, or the general

public, order the dissolution of such corporation entity and its remaining

assets liquidated accordingly. The Management committee or rehabilitation

receiver, board or body may overrule or revoke the actions of the previous

management and board of directors of the entity or entities under management

notwithstanding any provision of law, articles of incorporation or by-laws to

the contrary.

The management committee, or rehabilitation receiver, board or body shall not

be subject to any action, claim or demand for, or in connection with, any act

done or omitted to be done it in good faith in the exercise of its functions, or

in connection with the exercise of its power herein conferred."

"h) To issue subpoena duces tecum and summon witnesses to appear in any

proceedings of the Commission and in appropriate cases order the examination,

search and seizure of all documents, papers, files and records, tax returns,

books of accounts, as well as all deposits of whatever nature with bank or

banking institutions in the Philippines, including investments in bonds issued

by the Government of the Philippines, its political subdivisions and its

instrumentalities and similar documents, of any entity or person under

investigation as may be necessary for the proper disposition of the cases before

it, notwithstanding the provisions of any law to the contrary.

"m) To exercise such other powers as may be provided by law as well

as those which may be implied from, or which are necessary or incidental to the

carrying out of, the express powers granted to the Commission to achieve the

objectives and purposes of this Decree."

Section 5

SEC. 5. Section 8 of the same Presidential Decree, as

amended by Presidential Decree No. 1653, is hereby further amended to read as

follows:

"SEC. 8. The Commission shall have nine (9) departments each

to be headed by a director, namely: Corporate and Legal; Examiners and

appraisers; Brokers and Exchanges; Money Market Operations; Securities

Investigations and Clearing; Investment Research and Statistics; Administrative

and Finance; Prosecution and Enforcement; and Supervision and Monitoring

Departments.

The staffing pattern to implement this amended departmental structure shall

be approved pursuant to Section 40 of P.D. No. 1177, with any additional costs

incurred for 1980 and 1981 to be charged to the Special activities Fund of the

corresponding year upon approval by the President."

Section 6

SEC. 6. The Prosecution and Enforcement Department shall

have, subject to the Commission1a control and supervision, the exclusive

authority to investigate, on complaint or motu propio, any act or omission of

the Board of Directors/Trustees of corporations, or of partnerships, or of other

associations, or of their stockholders, officers or partners, including any

fraudulent devices, schemes or representations, in violation of any law or rules

and regulations administered and enforced by the Commission; to file and

prosecute in accordance with law and rules and regulations issued by the

Commission and in appropriate cases, the corresponding criminal or civil case

before the Commission or the proper court or body upon prima facie finding of

violation of any laws or rules and regulations administered and enforced by the

Commission; and to perform such other powers and functions as may be

provided by law or duly delegated to it by the Commission.

Prosecution under this Decree or any Act, Law, Rules and Regulations enforced

and administered by the Commission shall be without prejudice to any liability

for violation of any provision of the Revised Penal Code.

Section 7

SEC. 7. The Supervision and Monitoring Department shall have

the power of supervision over all corporations, partnership and associations

registered with the Commission in all matters pertaining to their compliance

with the laws, mandatory provisions and requirements of pertinent rules and

regulations administered and enforced by the Commission, as well as their

respective by-laws duly -approved by the Commission, integrate, analyze and

evaluate ongoing operations or activities of such entities; coordinate with, and

recommend to the appropriate departments for proper action and enforcement; and

to do and perform such other functions as may be duly delegated by the

Commission.

Section 8

SEC. 8. The proceeds and effects of crimes committed by any

person or entity in violation of the laws and regulations administered and

enforced by the Commission shall be forfeited, seized and confiscated in favor

of the State upon order of the Commission, after fine notice and bearing.

Section 9

SEC. 9. Any provisions of existing law, decree, order, rules

and regulations inconsistent with this Decree, is hereby repealed, amended or

modified accordingly.

Section 10

SEC. 10. This Decree shall take effect immediately.

Done in the City of Manila, this 2nd day of January, in the year of Our Lord,

nineteen hundred and eighty one.

(Sgd.) FERDINAND E. MARCOS

President of the

Philippines

By the President:

(Sgd.) JOAQUIN T. VENUS, JR.

Deputy Presidential Executive Assistant

Vol. 25, Vital Documents,

Presidential Decree 1980-1981