PHILIPPINES Law and Practice Contributed by: Raoul Angangco, Sylvette Y. Tankiang, Kristin Charisse C. Siao and Ma. Carla Mapalo, Villaraza & Angangco
agencies, including the Department of Trade and Industry, the Department of Finance, the Board of Investments, the Philippine Economic Zone Authority, the National Economic Development Authority and the Department of Information and Communications Technology. Meanwhile, the PCC has original and primary jurisdiction to review proposed mergers, acqui - sitions and joint ventures. Other government authorities may assist in enforcing and review - ing compliance with the relevant regulation on foreign investment, depending on the industry in which the entity operates and the incentives received. Notification is compulsory if a transaction exceeds the mandatory notification thresholds – ie, if the aggregate annual gross revenues in, into or from the Philippines, or the value of the assets in the Philippines of the ultimate parent entity (UPE) of at least one of the acquiring or acquired entities, including that of all entities that the UPE controls, directly or indirectly, exceeds PHP8.5 billion (“Size of the Party Test”); and the value of the transaction exceeds PHP3.5 bil - lion (”Size of the Transaction Test”). These new thresholds took effect on 1 March 2025. The new thresholds represent an increase from the Size of the Party Test and Size of the Transaction Test of PHP 7.8 billion and PHP 3.2 billion, respectively, that were in effect from 1 March 2024 to 28 Feb - ruary 2025. The revised thresholds, however, do not apply to transactions that were notified to the PCC before 1 March 2025 and transactions that have already been the subject of a decision by the PCC. 2. Jurisdiction 2.1 Notification
Calculating the value of the transaction depends on the type of the transaction. Notably, parties to a merger or acquisition with transaction values falling below the above thresholds may nonetheless voluntarily notify the PCC, and the PCC may, in its discretion, give due course to the same. Voluntary notifica - tion to the PCC may be made on the basis of an executed binding preliminary agreement or a A transaction that met the notification thresholds but was not notified to the PCC, and which was completed prior to the expiration of the waiting period, is considered void and will subject the parties and their UPEs to an administrative fine of 1% to 5% of the value of the transaction. Pursuant to Memorandum Circular No 21-001, which implemented adjustments to the fines imposable under the PCA, parties that fail to notify the PCC within the period for notification but have yet to complete the transaction will be fined in the amount of 0.05% of the value of transaction for the first 30 days of delay, or a fraction thereof. The fine will be increased by 0.01% of the value of the transaction for every additional 30 days of delay, or a fraction thereof, provided that the total amount of the fine to be imposed does not exceed PHP2.2 million. The decisions imposing the penalties are made public. 2.3 Types of Transactions Joint ventures, mergers and acquisitions of shares and assets, and issuances of new com - pany shares have been found by the PCC to have failed to comply with the compulsory noti - fication requirements. definitive agreement. 2.2 Failure to Notify
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