San Miguel to seek court relief from SEC's P769.3-million fine

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Metro Manila (CNN Philippines, November 30) — San Miguel Corporation (SMC) said Friday it will contest in court the P769.3-million fine imposed by the Securities and Exchange Commission (SEC) for the late filing of additional documents regarding the company's acquisition of Manila Electric Company shares in 2012.

SEC said the acquisiton should have been reported through Forms 23-A and 23-B, but SMC said these forms are merely reiterations of what it previously submitted. The penalty was based on three transactions involving Meralco shares.

SMC said that technically, there was no late disclosure of the share acquisition considering the relevant information were provided and disclosed to the SEC and PSE through the submission of SEC form 17-C.

"As such, the public was adequately and properly informed of the details of the share sale transaction inclusive of the purchase price, number of shares, equivalent percentage shareholdings in Meralco (27 percent) and the terms of payment," Ramon S. Ang, SMC president and chief operating officer, said in a statement.

Form 17-C is a current report on the securities, which would be affected by events such as purchases. Forms 23-A and 23-B would refer to beneficial ownerships and changes in the beneficial ownership, respectively.

Ang also said the fine was excessive and unreasonable.

"The penalty is highly disproportionate to the infraction attributed to the company considering that the disclosures made by SMC to both SEC and PSE were extensive enough to prevent market speculation and other similar fraudulent acts," he said.

Ang said that with the SEC's decision to impose fines, they will be constrained to seek relief from the court.

"Hopefully, the court will understand and appreciate the position of the company," Ang added. 

The SEC en banc, on November 21, denied SMC's appeal on the fine.

In its decision, the SEC called out SMC's argument of its late compliance to the submission of SEC Form 23 due to "inadvertence."

"Excuses such as inadvertence are self-serving and unverifiable," the SEC decision read.