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Philippines: SEC warns public vs dealing with unregistered foreign firms
MANILA, Philippine — Corporate regulators warned the public against conducting business with unregistered foreign companies and entities to avoid losing their earnings.
In a statement on Monday, the Securities and Exchange Commission cautioned that by dealing with these unregistered and unlicensed entities, the public runs the risk of losing their money once it’s transmitted outside the country.
The advisory came weeks after numerous government pronouncements about levying taxes on cryptocurrency investors, social media influencers and play-to-earn games such as Axie Infinity.
“A number of these unregistered corporations and entities allow Filipinos to access their online platforms and permit the enrollment, creation, or registration of client accounts through online means despite having no registration or license to do business in the Philippines,” the SEC said.
“In some cases, Filipinos are even targeted by their aggressive online advertisements in various social media networking sites like Facebook, YouTube or Instagram,” it added.
Play-to-earn games such as Axie Infinity reached cult status in the Philippines as thousands were left jobless or wanted additional income as the pandemic drags on. After all, Axie players only needed to play at least two to three hours daily to earn a decent income in Philippine standards.
Vietnam-based Sky Mavis, the company behind Axie Infinity, has not yet registered in the Philippines. Both the SEC and Bangko Sentral ng Pilipinas earlier said they are still studying the regulatory touchpoints regarding Axie and that they are not yet requiring the company to register.
Sky Mavis told players in a statement a month ago to comply with regulation and tax rules of their home country.
Under the law, a foreign entity is required to secure primary registration with the SEC if they want to do business in the country. By registering, their onshore operations will be subject to Philippine tax laws.
If individuals do decide to transact with unregistered entities, considering that the public has done due diligence, the SEC said the government can offer little to no protection against harm and any form of misconduct from these companies.
“Domestic participants would have to go to the country where these platforms are registered and where they operate to file the appropriate complaint in order to seek redress,” the SEC said.
Source: https://www.philstar.com/business/2021/09/13/2126863/sec-warns-public-vs-dealing-unregistered-foreign-firms