Philippines SEC seeks feedback concerning ICO regulations that have been proposed by the officials this Thursday. The new guidelines will assume that tokens issued in all ICOs are securities by default.
3 August, AtoZ Markets – The Philippines is approaching the date of introduction of new regulations concerning the process of how companies can legally raise funds via initial coin offerings (ICOs).
Philippines SEC Seeks Feedback Concerning ICO Regulations
Regarding this matter, the local regulatory body, the Securities and Exchange Commission (SEC) has published draft guidelines governing ICOs this Thursday. Now, the watchdog is seeking feedback from the public before the regulations can go into effect.
The financial regulator has commented in a press release that most ICOs conducted in the Philippines have argued that their tokens were not securities. They also stated that they should not be governed by the regulator. However, the new rules will assume that tokens issued in all ICOs are securities by default. This is unless the issuers can prove otherwise.
Moreover, the regulator has stated that it would be “dangerous” to let investors make assumptions about the matter since they do not have sufficient resources to identify which ICOs might be fraudulent, adding:
“Therefore, the SEC will put the burden of proving that the tokens issued through an ICO in the hands of the proponents by presuming that the tokens are securities unless proven otherwise.”
ICOs will need to prove their tokens are not securities
As per the proposed rules, companies that are registered in the Philippines and intend to conduct a token sale would need to submit an initial assessment application to the SEC. This would need to be done at least 90 days ahead of the issuance.
Aside from the details of the team behind the project, the application will also need to include the review of the ICO proposal and its credibility. Moreover, it will need to contain a legal opinion from an independent third party to prove that a token is not a security.
Following this process, the SEC will issue a written report outlining its decision regarding the proposed ICO’s claims.
Think we missed something? Let us know in the comments section below.