By Jenniffer B. Austria
The Securities and Exchange Commission said it is drafting the guidelines to ease the process for agriculture-based companies to raise capital through share sale.
Under the memorandum circular, SEC will issue a separate registration form for agri-based companies that plan to register and offer their shares to the public of up to P500 million.
The registration form to be called SEC FARMs (Securing & Expanding Capital form Farms and Agribusiness Related Modernization Schemes) will simplify the registration of farm-based businesses by easing the requirements for external auditors and financial reporting.
It will also shorten the period to declare the registration statement of farm-based businesses from 45 to 28 days.
The move is in line with the Philippine Development Plan 2023-2028 which aims to modernize and raise overall productivity of the agriculture and agribusiness sector.
The SEC acknowledged that the modernization of the agriculture sector involves application of innovative technology, which would require huge capital from both the private and public sectors.
It said agriculture companies may register their securities through SEC FARMS provided that the amount to be offered to the public represents at most 50 percent of the total project cost of a specific project. It should also have secured and allotted as seed money the other 50 percent of the total project cost.
The SEC said it would also allow a registrant company using SEC FARMS to file financial reports covering a period less than what is required by the Securities Regulation Code provided that the officers of the company have three-year related experience or if a related company is involved in similar business activity for the last three years.
Among the agri-based companies listed on the local bourse are AgriNurture Inc., Vitarich Corp., Bogo-Medellin Milling Company Inc., Liberty Flour Mills Inc. and Axelum Resources Corp.
The SEC is soliciting comments from agri-based firm and other affected sectors on the proposed guidelines.