Financial Crime World

Financial Advisors in the Philippines: Compliance Requirements to Avoid Regulatory Risks

The Securities and Exchange Commission (SEC) in the Philippines has implemented various compliance requirements for financial advisors to ensure they operate within the bounds of the law. Failure to comply with these requirements can result in regulatory risks, fines, and even revocation of licenses.

Key Compliance Requirements

  • General Information Sheet (GIS): Financial advisors must submit a GIS within 30 calendar days following the date of the stockholder’s meeting or on or before January 30th of each year.
  • Audited Financial Statements (AFS): Financial advisors are required to submit AFS as prescribed by the SEC Memorandum Circular.
  • Certificate of Compliance with Manual of Corporate Governance: Financial advisors must obtain a Certificate of Compliance with the Manual of Corporate Governance (SEC Form MCG-2009) and file it on or before January 30th of each year.
  • Secretary’s Certificate on Attendance of Board of Directors: Financial advisors are required to submit a Secretary’s Certificate on the Attendance of Board of Directors, which must be filed on or before January 30th of each year.

Additional Requirements for Investment Company Advisers

  • Registration Form/Amendment Form for Investment Company Advisers (SEC Form ICA-IA): Investment company advisers must submit this form within 7 days from the date of occurrence.
  • Notice for Termination of Certified Investment Solicitor or Compliance Officer (SEC Form ICA-T): Investment company advisers are required to file this form within 7 days from the date of occurrence.
  • Amendment/Changes in Information contained in SEC Form ICA-CIS and ICA-CO: Investment company advisers must submit these forms within 7 days from the date of occurrence.

Quarterly and Annual Reports

  • Annual Reports (SEC Form ICA-AR): Financial advisors are required to submit annual reports to the SEC.
  • Quarterly Reports (SEC Form ICA-QR): Financial advisors must submit quarterly reports to the SEC.
  • Special Forms for Financial Statements (GFFS): Financial advisors must submit special forms for financial statements in electronic format within 30 days after submitting their annual financial statements.

Consequences of Non-Compliance

Failure to comply with these requirements can result in regulatory risks, including fines and even revocation of licenses. Therefore, it is essential for financial advisors in the Philippines to ensure that they are aware of and comply with all relevant SEC requirements to avoid any legal consequences.