Amending Title 17, Chapter III, Of Presidential Decree No. 612, Otherwise Known As The Insurance Code, On The Mutualization Of Stock Life Insurance Companies
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Amending Title 17, Chapter III, Of Presidential Decree No. 612, Otherwise Known As The Insurance Code, On The Mutualization Of Stock Life Insurance Companies
Presidential Decree No. 1280
January 6, 1978
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Summary of Presidential Decree No. 1280Amending Title 17, Chapter III, of Presidential Decree No. 612 (Insurance Code) on the Mutualization of Stock Life Insurance Companies
- Allows a domestic stock life insurance company to convert itself into an incorporated mutual life insurer by acquiring and cancelling all outstanding shares of its capital stock. (Sec. 269-A)
- If 90% of the outstanding shares have been acquired within the plan period, the insurer can make an offer to purchase the remaining shares at a specified price considered as fair value, with the Commissioner's permission. (Sec. 269-A)
- Shareholders have 30 days to accept the offer in writing. Accepted shares must be transferred within 60 days, and the insurer will pay the offered price. (Sec. 269-A)
- Shareholders who do not accept the offer within the time limit can apply to the Secretary of Finance within 15 days for a determination of the fair value of their shares as of the offer date. (Sec. 269-A)
- The Secretary of Finance can determine the fair value through a hearing or appoint three impartial appraisers. The appraisers' report can be objected to within 10 days, and the Secretary will issue a final order after a hearing. (Sec. 269-A)
- The Secretary's findings on facts are conclusive, and the order determining fair value and payment terms has the force of a judgment, appealable on questions of law. (Sec. 269-A)
- Shareholders must transfer their shares and surrender certificates upon payment as per the final order. The Secretary can compel the surrender if the shareholder fails to do so. (Sec. 269-A)
- Shareholders who do not apply to the Secretary within the prescribed time are deemed to have accepted the initial offer. (Sec. 269-A)
- The offer to acquire shares is irrevocable until all proceedings are completed or all shares are acquired. (Sec. 269-A)
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Executive Issuances
Presidential Decrees
mutualization
stock life insurance companies
acquisition of shares
fair value determination
Secretary of Finance
appraisers
offer to acquire shares
transfer of shares
cancellation of shares
payment terms
appeals
final order
compulsory surrender
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Amending Title 17, Chapter III, Of Presidential Decree No. 612, Otherwise Known As The Insurance Code, On The Mutualization Of Stock Life Insurance Companies
Presidential Decree No. 1280
•January 6, 1978
MALACAÑANGM a n i l a
PRESIDENTIAL DECREE No. 1280 January 6, 1978
AMENDING TITLE 17, CHAPTER III, OF PRESIDENTIAL DECREE NO. 612, OTHERWISE KNOWN AS THE INSURANCE CODE, ON THE MUTUALIZATION OF STOCK LIFE INSURANCE COMPANIES
WHEREAS, under Title 17, Chapter III, of Presidential Decree No. 612, otherwise known as the Insurance Code, a domestic stock life insurance company doing business in the Philippines may convert itself into an incorporated mutual life insurer;
WHEREAS, a big majority of the stockholders of one such stock life insurance company, recognizing the contribution made by the policyholders to the total assets of the company over the years, and fully believing that the social, economic and political development of the country will enhanced by the wider ownership of companies, have decided to mutualized under the provision of the aforementioned Title 17, Chapter III, of the Insurance Code, and thus achieve the widest conceivable distribution of ownership of the company;
WHEREAS, under the aforementioned provisions of the Insurance Code, a stock life insurance company becomes mutualized only when all...
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