August 11, 2020
SEC MEMORANDUM CIRCULAR NO. 20-20
| TO | : | All Exchanges and Other Organized Markets |
| SUBJECT | : | SEC Rules on the Number of Independent Directors and Sectoral Representatives of Exchanges and Other Organized Markets |
WHEREAS, Republic Act No. 11232, or the Revised Corporation Code of the Philippines ("RCC"), was approved on February 20, 2019 and took effect on February 23, 2019.
WHEREAS, Section 22 of the RCC prescribes that the number of independent directors of the board of directors of corporations vested with public interest constitute at least 20% of such board, institutionalizing the presence of persons who shall exercise independent judgment in carrying out the responsibilities as directors.
WHEREAS, the Supreme Court has declared that it is undeniable that an Exchange is not an ordinary corporation, in that although it is clothed with the marking of a corporate entity, it functions as the primary channel through which the vessels of capital trade ply. An Exchange's relevance to the continued operation and filtration of the securities transaction in the country give it a distinct color of...
