THE Philippine Stock Exchange, Inc. (PSE) has removed inactive trading participants as it works on complying with the single-industry cap on exchange ownership.

In a statement issued Wednesday, the PSE said it has revoked the status of inactive trading participants who also hold about 2.34% of the total outstanding capital stock in the company. The PSE earlier noted that 14 out of 52 inactive trading participants held shares in the company.

The bourse operator has also declared as vacant the trading rights of the dormant brokers.

The PSE said the Securities and Exchange Commission (SEC) will then complete the process of revoking the registration of dormant brokers, should they fail to amend their primary purpose to that of a non-broker business.

The removal of the inactive brokers, alongside PSE’s stock rights offering of 11.5 million shares this March, will bring down ownership of trading participants in the company to 22.05%.

“The company is confident that with the offer fully underwritten and the procedures already being implemented by the company and the SEC, this will be fully achieved,” the SEC said.

Once the SEC completes its administrative procedures on the dormant brokers, their ownership will further be brought down to below 20%.

The move is in line with the single-industry limit set by the Securities Regulation Code, which states that “no single industry or business group shall beneficially own or control, directly or indirectly, more than 20% of the voting rights of the Exchange Controller.”

The PSE’s statement comes after the SEC called out the former for inaccurate and misleading information regarding the reduction of broker ownership in the bourse. The SEC then implemented a trading halt on PSE shares from 10:19 a.m. to 1:30 p.m. on Wednesday.

Shares in PSE gained a peso or 0.41% to close at P245 each on Wednesday.

Ensuring compliance with the single-industry cap is also necessary in obtaining the SEC’s approval for the PSE’s proposed acquisition of the Philippine Dealing System Holdings Corp.

To finalize the deal, the PSE has filed a petition with the SEC for exemptive relief, allowing the former to own more than 20% of the fixed-income exchange. — Arra B. Francia

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