The Securities and Exchange Commission (SEC) is proposing a streamlined reporting and compliance framework for foundations in the Philippines, seeking to consolidate several requirements into a simpler and more standardized system.
The proposed omnibus rules, released for public comment on Sept. 29, would bring together registration, reporting and continuing compliance requirements that are currently spread across various laws, regulations and SEC issuances. The public has until Oct. 15 to submit comments on the draft.
Under the proposal, the rules would cover all foundations registered with the SEC as well as organizations applying for foundation status. Applicants would have to be organized as non-stock, nonprofit corporations, use the word “Foundation” in their corporate names and maintain at least ₱1 million in paid-up capital, supported by a notarized bank deposit certificate.
The SEC defines a foundation as a non-stock, nonprofit corporation established to provide grants or endowments or raise funds for purposes such as charitable, religious, educational, athletic, cultural, literary, scientific and social welfare activities.
A major change under the draft is the proposed simplification of financial and organizational reporting. Instead of complying with multiple documents under separate requirements, foundations would use three standardized Simplified Non-Stock, Non-Profit Organization forms. These would include supplemental information covering operations, activities, governance, programs, projects and the use of funds.
The proposal would also establish clearer filing schedules. A foundation’s Membership Book would have to be registered with the SEC within 30 days of incorporation, while its General Information Sheet would generally be due within 30 days after its annual meeting. If no annual meeting is held, the GIS would have to be submitted by Jan. 30 of the following year.
Financial reporting requirements would depend on the foundation’s size. Organizations with total assets or liabilities exceeding ₱3 million would be required to submit audited financial statements in accordance with the SEC’s applicable rules. Foundations with assets or liabilities of ₱3 million or less would be allowed to submit unaudited financial statements signed under oath by designated officers.
The draft also sets out penalties for noncompliance. Failure to submit required forms would carry an annual fine of ₱5,000, while late filing would result in an annual penalty of ₱2,500.
The proposed framework is intended to place foundation-related requirements under one consolidated set of rules while retaining disclosure and accountability measures. For foundations, the changes could make compliance more predictable by reducing the number of separate documents and clarifying which financial statements are required.
The proposal remains subject to public consultation and could still be revised before the SEC adopts final rules. Foundations and other interested organizations therefore have an opportunity to review the draft and submit comments before the Oct. 15 deadline.
