THE SECURITIES and Exchange Commission (SEC) is set to release an exposure draft for amendments to the real estate investment trust (REIT) rules within the next few weeks, with implementation aimed for January.
“Maybe two weeks before we release the exposure draft. If I were to decide, it should be effective sometime in January, preferably Jan. 1, but as I said, there is a process,” SEC Chairperson Francisco Ed. Lim told reporters on Friday last week.
The draft seeks to expand and clarify the definition of income-generating assets under the REIT rules, which would allow more companies — including those in power, infrastructure, and telecommunications — to list. Among the proposed amendments is the enumeration of asset types to avoid confusion and disputes over what constitutes an income-generating property.
In earlier statements, Mr. Lim said the commission planned to revise REIT rules to bolster the Philippine capital market by widening the range of eligible assets, extending the reinvestment period, and encouraging broader participation.
Republic Act No. 9856, or the REIT Act of 2009, provides tax incentives to REITs, which are companies that invest in income-producing properties. Under the REIT framework, at least 75% of a REIT’s deposited property must consist of income-generating real estate, including those held under freehold or leasehold arrangements.
Mr. Lim also highlighted broader efforts by the SEC to liberalize benefits for the market.
Last month, the commission said it awarded more than P80 million in fee discounts across 40,157 transactions processed under three memorandum circulars issued between July and October, with over half of the total savings going to micro, small, and medium enterprises (MSMEs).
In September, the SEC approved rules extending the validity period of shelf registration up to five years from three, and simplifying requirements for subsequent tranches for listed companies.
Mr. Lim also noted that he is reviewing a draft on financial literacy aimed at high school students and plans to finish by next week.
“I intend to propose it as a law,” he said. — Alexandria Grace C. Magno
